WORKERS REHABILITATION AND COMPENSATION TRIBUNAL

CATCHWORDS: Proceedings to obtain compensation - Determination of claims - Estoppel - Whether worker able to challenge validity of s86(1)(c) certificate - Assumption by one party - Whether unconscionable if departure from assumption permitted - Whether detriment -

J T Hiscutt & Sons v Moore [2000] TASSC 125

DETERMINATION: 1. That the worker is not estopped from challenging the validity of the s86(1)(c) certificate.

2. That the certificate of Dr A J Buzzard dated 17 January 2003 is a valid certificate for the purposes of s86(1)(c).

[2005] TASWRCT 19

Commissioner Chandler

1 The worker has filed a reference with the Tribunal pursuant to s86(4) seeking to challenge the employer's termination of his weekly payments. That termination followed the service upon the worker of a certificate provided by consultant surgeon, Dr Anthony J Buzzard. That certificate is expressed as follows:-

"I, ANTHONY J BUZZARD, of 517 St Kilda Road, Melbourne in Victoria, being a medical practitioner accredited for the purposes of the Workers Rehabilitation and Compensation Act 1988, certify that having examined (the worker) on 28 November 2002, it is my opinion that (the worker's) injury to his lumbar spine that occurred on or about the 21 January 2001 is no longer due, wholly or substantially to that injury.

(The worker) suffers from pain in the back which extends down both legs and then to the backs of them to the feet. He is taking methadone, one twice daily, Mersyndol Forte and Deptran at night. I viewed a discogram and report of the 14th October 2002. The discogram has confirmed my previously held suspicion that he does have discogenic low back pain that appears to be emanating from the L4/5 level.

I note that Mr Liddell concludes that an early back injury (in the early 1990's) set the scene for the subsequent back injury. I agree with that proposition. (The worker) told me that he first hurt his back in 1990. At the time he was at work lifting a trailer. He experienced back pain "my back went out" he said.

His next problem occurred in 2000. At that time he was lifting a heavy stone at work and experienced lumbar pain. He told me "my back went again".

There was a further incident on or about the 21st January 2001 when he was opening a work gate. He had more pain.

This patient does have pain in the low back region which is probably discogenic. I think he probably initially developed the disc degeneration following the 1990 accident. I note the initial x-rays do demonstrate degenerative disease of the low back region.

I believe that the incident of opening the gate could have caused a back strain. However, such a back strain would normally be expected to fairly rapidly subside and I believe it has in this instance. I do not now think that the gate incident is playing any part in the patient's overall presentation that is more than trivial or inconsequential. I believe that the most likely cause of the patient's continuing back trouble is the incident that occurred in 2000 and the disc degeneration that followed after the 1990 accident. I note that this opinion appears to concur with the opinion of Mr Liddell.

Dated this 17 day of January 2003."

2 For reasons which I will expand upon later the worker asserts that Dr Buzzard's certificate does not meet the requirements of the Act and is thus invalid. He seeks the determination of this issue as a preliminary matter. The employer's response is twofold. First it contends that Dr Buzzard's certificate is valid and that there has been a proper termination of the worker's weekly payments. However, separately, the employer submits that the Tribunal should determine, in light of the facts, that the worker is estopped from now contending that Dr Buzzard's certificate is invalid so that the employer did not have the right to proceed to terminate the worker's weekly payments in accord with s86(3). It's logical that I deal first with the estoppel argument.

3 In the course of his submission Mr Jackson, as the employer's counsel, tendered into evidence several documents and made a number of assertions of fact from the bar table. It is my understanding that counsel for both parties agree that these documents and assertions together constitute the agreed factual background relevant to the issue of estoppel. That background is as follows:

1. The worker made a claim upon his employer alleging that he had suffered a lower back injury on 21 January 2001 when "opening gate.".

2. The initial medical certificate accompanying the claim does not state a diagnosis but shows the worker's presenting symptoms to be "low back pain". It states the condition to be consistent with an incident on 21 January 2001 when the worker was "shutting gate while moving sheep".

3. The claim was accepted and the employer began paying compensation including a weekly payment.

4. Dr Buzzard's s86(1)(c) certificate is dated 17 January 2003. As at that date the worker was still receiving a weekly payment.

5. On 11 February 2003 the employer's s86(3) notice including Dr Buzzard's certificate was served on the worker. His weekly payment of compensation was terminated 10 days from that date.

6. On 24 March 2003 the worker made this reference to the Tribunal pursuant to s86(4).

7. On 2 April 2003 Mr Ayliffe, the then solicitor for the worker, wrote to Messrs Jackson and Tremayne, the solicitors for the insurer of the employer at risk at the time of the worker's 2001 injury. The letter is expressed in these terms:-

"Re: (The Worker) v Stockmans (sic) Stud

It appears that the Section 86 Notice that has been issued does not really advance the case. In our submission a Section 86 Notice should, on its face, indicate that there is no basis for liability. The Certificate issued to (the worker) however indicates on its face that there certainly is a basis for liability based on the 2000 accident and therefore the Section 86 Notice is void.

The liability so far as the worker is concerned is against the employer. The Certificate seems to have been issued under a misconception that it absolved your insurance client rather than the employer.

Furthermore it seems to us that the use of the statutory phrase "no longer due wholly or substantially to the injury" is quite misconceived as the Certificate certainly appears to accept incapacity. In fact as we understand it there is no real dispute about capacity.

Obviously the earlier Section 97 proceedings which have been adjourned sine die against Royal and Sun Alliance need to be re-activated.

In the meantime as you will know we have filed the appropriate Section 86(4) Notice on behalf of (the worker).

It seems to us that Royal and Sun Alliance should come to the table.

Our client would welcome an around the table discussion with or without a Registrar present."

8. On 9 April 2003 Mr Tremayne sought and received instructions to have listed as a matter of urgency a directions hearing with the Tribunal with a view to having the validity of Dr Buzzard's certificate determined as a preliminary issue. On that same day Mr Tremayne wrote to Mr Ayliffe in these terms:

"We take the view that when preliminary questions such as the one raised in your letter are put forward as a genuine issue, they should be decided as a preliminary point and as expeditiously as possible. We have therefore written to the Tribunal."

9. Also on 9 April Mr Tremayne wrote to the Tribunal enclosing a copy of Mr Ayliffe's letter and concluding with these sentences:-

"If there is any substance in Mr Ayliffe's claim that the certificate is void then that ought to be determined as soon as possible. We would ask that you list this matter, as a matter of urgency, for a directions hearing at which time we shall seek to have the validity of the certificate determined as a preliminary question."

10. The employer's purpose in seeking to have the validity of Dr Buzzard's certificate urgently determined was to give it the option, in the event of an unfavourable determination by the Tribunal, to start the termination process afresh.

11. At a directions hearing on 28 April the Tribunal appointed Monday 19 May 2003 as the date for the hearing of a preliminary argument concerning the validity of Dr Buzzard's certificate.

12. On 16 May Mr Ayliffe wrote to the Tribunal in these terms:-

"Re: (The Worker) -v- Stockman Stud Tasmania - 3212/2003

I have reached the view that my application set down for hearing at 2.15 p.m. on Monday the 19th May, 2003 is unlikely to be successful and accordingly I wish to advise that I will not proceed with the argument.

I will talk with Mr Tremayne the Solicitor for the Respondent during the course of the day (he was unavailable this morning). Accordingly I respectfully asked that the appointment be vacated but for half an hour to dispose of any consequential orders. If there is (sic) no consequential orders then I will advise forthwith."

13. Later on 16 May Mr Ayliffe spoke to Mr Tremayne by telephone and the solicitors agreed that the s86(4) reference would ultimately proceed and be determined on its merits and that the costs of the preliminary argument be reserved.

14. Following a protracted and unsuccessful conciliation process the Tribunal set down the worker's s86(4) reference for hearing beginning on 23 February 2005.

15. On 25 January the Tribunal received a letter from the worker's solicitors requesting a pre-trial directions hearing. The request was put on this basis, "It will be admission (sic) of Counsel at the Pre-Trial Hearing that the matter should be set down for an argument on a preliminary point of law which could dispose of the matter I (sic) half a day, thus saving costs and Tribunal time."

16. The worker did not at any time between 16 May 2003 and 25 January 2005 give any indication to the employer that there would be any further issue raised concerning the validity of Dr Buzzard's certificate and the right of the employer to terminate weekly payments. Rather during this period the matter had remained on that basis which the solicitors had agreed on 16 May 2003.

4 The employer says that when, in April 2003, the worker first raised as an issue the validity of Dr Buzzard's certificate it promptly took steps to have that issue determined by the Tribunal. It did so because, as has been agreed as part of the factual background, it wished to have the option of re-commencing the termination process if the Tribunal's decision had been in the worker's favour. The agreement made between the solicitors on 16 May 2003 when the worker abandoned his challenge to the validity of the certificate caused the employer, it is submitted, to assume that the s86(4) reference was to be determined solely upon its merits, that is whether Dr Buzzard's opinions upon the worker's incapacity would be upheld, and that no issue would be raised concerning the certificate's validity. Now, if the worker is permitted to depart from the agreement and challenge the validity of Dr Buzzard's certificate and that challenge is successful, the employer says that it will be significantly disadvantaged. This is so because it will have a liability to make weekly payments backdated to their termination, a period now in excess of two years. That liability would be for a significantly greater sum than any amount which may have been payable had the issue of the certificate's validity been determined at an earlier time. It is in these circumstances that the employer says that the worker should be estopped from raising as an issue the validity of Dr Buzzard's certificate.

5 The employer's estoppel argument has as its basis the case of The Commonwealth v Verwayen (1990) 170 CLR 394 where the High Court, in a majority decision, determined that the Commonwealth was estopped from resiling from a promise not to plead the Limitation of Actions Act 1958 (Vict.) in defence of a claim for damages for personal injury suffered by a member of the defence forces in combat exercises at sea. In his judgement Deane J, as a member of the majority, at [21] sets out his views upon the principle of estoppel by conduct. As the employer in this instance draws upon Deane J's statement of this principle as the basis for its submission, it's helpful that I set out the relevant portions here:

"2. The central principle of the doctrine is that the law will not permit an unconscionable - or, more accurately, unconscientious- departure by one party from the subject matter of an assumption which has been adopted by the other party as the basis of some relationship, course of conduct, act or omission which would operate to that other party's detriment if the assumption be not adhered to for the purposes of the litigation.

3. Since an estoppel will not arise unless the party claiming the benefit of it has adopted the assumption as the basis of action or inaction and thereby placed himself in a position of significant disadvantage if departure from the assumption be permitted, the resolution of an issue of estoppel by conduct will involve an examination of the relevant belief, actions and position of that party.

4. The question whether such a departure would be unconscionable relates to the conduct of the allegedly estopped party in all the circumstances. That party must have played such a part in the adoption of, or persistence in, the assumption that he would be guilty of unjust and oppressive conduct if he were now to depart from it. The cases indicate four main, but not exhaustive, categories in which an affirmative answer to that question may be justified, namely, where that party

(a) has induced the assumption by express or implied representation;

(b) has entered into contractual or other material relations with the other party on the conventional basis of the assumption;

(c) has exercised against the other party rights which would exist only if the assumption were correct;

(d) knew that the other party laboured under the assumption and refrained from correcting him when it was his duty in conscience to do so. Ultimately, however, the question whether departure from the assumption would be unconscionable must be resolved not by reference to some preconceived formula framed to serve as a universal yardstick but by reference to all the circumstances of the case, including the reasonableness of the conduct of the other party in acting upon the assumption and the nature and extent of the detriment which he would sustain by acting upon the assumption if departure from the assumed state of affairs were permitted. In cases falling within category (a), a critical consideration will commonly be that the allegedly estopped party knew or intended or clearly ought to have known that the other party would be induced by his conduct to adopt, and act on the basis of, the assumption. Particularly in cases falling within category (b), actual belief in the correctness of the fact or state of affairs assumed may not be necessary. Obviously, the facts of a particular case may be such that it falls within more than one of the above categories."

6 I am satisfied that the employer has since mid-May 2003 adopted the assumption that the worker's reference would be determined solely upon its merits and that it would not be required to answer any argument concerning the validity of Dr Buzzard's certificate and its right to terminate weekly payments. It has done so as a consequence of the actions of the worker in abandoning the preliminary argument set down for hearing in May 2003 and agreeing at that time, courtesy of his solicitor, that the reference would proceed to be determined on its merits. Consistent with this agreement the worker did not, over the ensuing 18 months give any indication that any issue existed concerning the validity of the certificate. In the circumstances the adoption of this assumption by the employer has been reasonable. The question becomes whether it would now be unconscionable to permit a departure from this assumption by allowing the worker to challenge the certificate and the employer's right to terminate weekly payments. This question brings me to consider the nature and extent of the detriment to the employer, (if any), which would be sustained by such departure.

7 I accept that the employer, by its adoption of the assumption has suffered detriment in that its opportunity to have an earlier determination made by the Tribunal upon the validity of Dr Buzzard's certificate has been very significantly delayed. I accept too that the detriment is compounded by the possibility that the employer will have to make weekly payments extending back a period in excess of two years if the worker is now successful in his challenge of the certificate. What remedy, (if any), is appropriate in these circumstances? On this subject the judgements in Verwayen provide some guidance:

Mason CJ at [36], "A central element of that doctrine (of estoppel) is that there must be a proportionality between the remedy and the detriment which is its purpose to avoid. It would be wholly inequitable and unjust to insist upon a disproportionate making good of the relevant assumption."

And at [46], "When a Court approaches the task of ascertaining the minimum relief necessary to "do justice" between the parties, it is not correct to make an assessment of the moral rectitude of reactions of the parties in a manner divorced from a consideration of the legal consequences and attributes of those actions. Thus it must be borne in mind that a voluntary promise is generally not enforceable and that pleadings are susceptible of amendment. The breaking of a promise, without more, is morally reprehensible, but not unconscionable in the sense that equity will necessarily prevent its occurrence or remedy the consequent loss. In the same way, with estoppel, something more than a broken promise is required."

And at [49] Mason CJ concluded, "To hold the Commonwealth to its representations, thereby depriving it of defences which were available to it by statute or the general law, would be a disproportionate response to the detriment suffered by the respondent in reliance upon the assumption that the defences would not be pleaded."

Brennan J at [21] stated, "The judgements of a majority of the Court in Waltons Stores v Maher held that equitable estoppel yields a remedy in order to prevent unconscionable conduct on the part of the party who, having made a promise to another who acts on it to his detriment, seeks to resile from the promise...............the remedy is to effect what Scarman LJ called "the minimum equity to do justice"..................the remedy is not designed to enforce the promise although, in some situations (of which Waltons Stores v Maher affords an example), the minimum equity will not be satisfied by anything short of enforcing the promise."

And Deane J at [17] "Even in a case where an estoppel by conduct is established and would prima facie operate to preclude departure from the assumed state of affairs, the circumstances may be such that to grant unqualified relief on that basis would exceed any requirements of good conscience and be unduly oppressive on the part of the other party."

And at [18], "There is clear support in the cases and learned writings for the view that, in this as in other fields, equitable relief must be moulded to do justice between the parties and to prevent a doctrine based on good conscience from being made an instrument of injustice or oppression. That being so, it should be accepted that the prima facie entitlement to relief based on the assumed state of affairs must, under a doctrine which is of general application in a system where equity prevails, be qualified if it appears that relief would exceed what could be justified by the requirements of conscientious conduct and would be unjust to the estopped party."

And at [19], "To acknowledge the fact that the relief appropriate to a case of estoppel by conduct may vary according to the circumstances is not to suggest that relief is to be framed on an unprincipled basis. Prima facie, the operation of an estoppel by conduct is to preclude departure from the assumed state of affairs. It is only where relief framed on the basis of that assumed state of affairs would be inequitably harsh, that some lesser form of relief should be awarded."

And at [32] Gaudron J states, "Although it is not necessary for me to deal with the argument that the object of an estoppel is to avoid detriment and not to make good the assumption on which it is founded, it is convenient that I note my agreement with Mason CJ that the substantive doctrine of estoppel permits a Court to do what is required to avoid detriment and does not, in every case, require the making good of the assumption. Even so, it may be that an assumption should be made good unless it is clear that no detriment will be suffered other than that which can be compensated by some other remedy. Where the nature or likely extent of the detriment cannot be accurately or adequately predicted it may be necessary in the interests of justice that the assumption be made good to avoid the possibility of detriment even though the detriment cannot be said to be inevitable or more probable than not."

And McHugh J at [31], "What will be required to satisfy the equity which arises against the party estopped depends on the circumstances: Waltons, per Mason CJ and Wilson J at p404. Often the only way to prevent the promisee suffering detriment will be to enforce the promise but the enforcement of promises is not the object of the doctrine of equitable estoppel. The enforcement of promises is the province of contract. Equitable estoppel is aimed at preventing unconscionable conduct and seeks to prevent detriment to the promisee. As Brennan J pointed out in Waltons, "in moulding its decree, the Court, as a Court of conscience, goes no further than is necessary to prevent unconscionable conduct": at p419. Consequently, a Court of equity will only require the promise or assumption to be fulfilled if that is the only way in which the equity can be fulfilled: per Brennan J at [416]."

8 To require the assumption to be made good in this instance would deny the worker the opportunity to challenge the validity of Dr Buzzard's certificate. That outcome would, in my opinion, be significantly disproportionate to any detriment which may be sustained by the employer. At its worst the employer's detriment would require it to make weekly payments for a greater period than may otherwise have been the case. Such a scenario is speculative and uncertain. It assumes that the worker's challenge to the termination of his payments will be successful. It also assumes that had Dr Buzzard's certificate been determined to be invalid at an earlier time then the employer would have re-commenced the termination process and that it was then able to comply with all procedural requirements. Finally it assumes that the worker has remained incapacitated and has continued to provide his employer with supporting medical certificates since the termination of his weekly payments. I note that there is not any evidence upon this subject. In all of the circumstances it is my view that it would be a disproportionate response for the Tribunal to prohibit the worker from challenging the validity of the certificate when weighed against any detriment which may be suffered by the employer. For this reason I reject the employer's submission concerning estoppel. I now turn to consider the validity of the subject certificate.

9 The requirements of a certificate provided by a medical practitioner were reviewed by Underwood J (as he then was) in J T Hiscutt & Sons v Moore [2000] TASSC 125. At [5] and [6] his Honour stated:-

"It has been judicially determined that to satisfy the statutory requirements, the certificate must clearly, unambiguously and unequivocally comply with the statutory requirements which I have set out. See Gibsons Ltd v Jeffrey (1993) 2 Tas R 375; Osmond v Kemp & Denning Ltd A44/1993. A certificate will be ambiguous if it does not clearly identify the injury in respect of which weekly payments are being made, and relate that injury to any claimed recovery or ongoing incapacity. See Osmond v Kemp & Denning Ltd (supra) at 4-5.

The requirements of a valid certificate were examined by the Full Court of this Court in Gardner v Hansen and Yuncken (Tasmania) Pty Ltd [1996] TASSC 113; (1996) 6 Tas R 248. In my judgment in that case, I reviewed most of the authorities in this Court that had dealt with this issue. There is no need to refer to them again. The Act prescribes no formal requirements for a certificate. Provided the certificate:

• clearly and unambiguously identifies the injury in respect of which weekly payments are being made;

• clearly expresses the medical practitioner's opinion that the worker has wholly recovered or substantially recovered from the effects of that injury, or that any incapacity is no longer due, wholly or substantially, to that injury; and

• sets out the grounds upon which the opinion is given;

it will comply with the provisions of s86(2). Certificates are to be construed in an ordinary common sense way and no curial gloss is to be placed on the plain words of s86(1)(c) and (2).

10 It's incumbent upon me to apply that criteria clearly stated in JT Hiscutt and Sons to the certificate which is in dispute here.

11 In the opening paragraph of his certificate Dr Buzzard refers to the worker's "injury to his lumbar spine that occurred on or about 21 January 2001". After making reference to the worker's symptoms and treatment in the second paragraph Dr Buzzard, in the following three paragraphs, sets out some history involving the worker's back condition beginning with an injury suffered in 1990 another in 2000 and then "a further incident on or about the 21st January 2001 when he was opening a work gate. He had more pain." In the final paragraph Dr Buzzard states, "I believe that the incident of opening the gate could have caused a back strain" and later says, "I do not think that the gate incident is playing any part in the patient's overall presentation......" Although the certificate is very poorly drafted, which the employer's counsel acknowledged, it is nevertheless my view that when read in its entirety in a common sense way the certificate does identify the injury in respect of which payments were being made, namely that back injury suffered when opening a gate on 21 January 2001 and described as a "back strain".

12 It is apparent from his certificate that Dr Buzzard does not assert that the worker has wholly recovered from the effects of his back injury. The question is whether the certificate adequately states that the worker's incapacity is no longer due, wholly or substantially, to that injury?

13 The first paragraph of the certificate includes this statement, "...it is my opinion that the worker's injury to his lumbar spine that occurred on or about the 21 January 2001 is no longer due, wholly or substantially to that injury". This phrase obviously does not make any sense. The word "injury" (first occurring) is an error and should read "incapacity". However, this is not an error which is so blatant that it should have been realised by the worker and the certificate read as though the error had not been made. In my view this phrase by itself is not sufficient statement that any incapacity is no longer due, wholly or substantially to the work injury. What of the balance of the certificate? The only portion relevant to this subject is the final paragraph which I have already set out. In that paragraph Dr Buzzard acknowledges that the worker has "continuing back trouble" but states that the "gate incident" is not playing any part in his presentation which is more than trivial or consequential. Instead Dr Buzzard ascribes the "back trouble" to the earlier incidents in 1990 and 2000. In the result, whilst the certificate does not include an express statement that the worker's incapacity is no longer due to his injury suffered in 2001, it is common sense to conclude from these extracts which I have highlighted that Dr Buzzard is of the view that the worker has largely overcome any difficulties with his back arising from the back strain suffered when opening the gate in 2001 so that his continuing difficulties are attributable to the earlier incidents occurring in 1990 and 2000. In these circumstances I am satisfied that the certificate has sufficiently incorporated the opinion of Dr Buzzard that his incapacity for work is no longer attributable, either wholly or substantially to that injury suffered in 2001.

14 Does the certificate set out the grounds for Dr Buzzard's opinion which grounds are not so unclear or so ambiguous or so unrelated to the opinion so to make the certificate invalid? see J T Hiscutt and Sons at [14].

15 The grounds for Dr Buzzard's conclusion that the worker's current back difficulties are no longer attributable to his 2001 injury are contained in the final paragraph of his certificate which I have already set out. There the certifier explains the basis for this opinion is his belief that the worker has in effect largely recovered from the back strain suffered in the gate opening incident and that his continuing difficulties are instead attributable to a combination of the disc degeneration which followed the 1990 incident and the 2000 incident. These grounds are easily understood and are, in my opinion sufficient to satisfy the requirement that the certificate include the grounds for the opinion given.

16 It follows from the foregoing that Dr Buzzard's certificate of 17 January 2003 is, in my opinion, a valid certificate for the purposes of s86(1)(c) and I determine accordingly. The Tribunal will appoint a date for the determination of the merits of this reference after consultation with the solicitors for the parties.