Gibbs v WorkCover Corporation/Mercantile Mutual Insurance

"The worker has the right to be assessed on the basis that his glass eye is an external removable aid and therefore should be disregarded for the purposes of assessing disfigurement."

Reconsideration - Binding on the Compensating Authority?

1. The worker contends that in light of the observations made by the majority in Wear v WorkCover/Allianz Australia Workers Compensation (SA) Pty Ltd (Greyhound Pioneer Australia) [2001] SAWCT 77 the Corporation is bound by the terms of its reconsideration.
2. In Wear the majority ruled that the Corporation could not resile from a position that it had taken following its reconsideration. However, the decision needs to be understood in the context of the facts of the case. The dispute between the parties concerned a worker's claim for compensation pursuant to s 43 of the Act on account of his alleged loss of hearing. The Corporation determined to reject the worker's claim. The worker contested that rejection by a Notice of Dispute whereupon the Corporation reconsidered the rejected claim and resolved to accept it. The worker's employer was dissatisfied with the result of that reconsideration. Accordingly, it expressed that dissatisfaction as contemplated by s 91A and as a result, the matter proceeded through the dispute resolution process provided for by the Act, culminating in a hearing before an Arbitration Officer. Having heard evidence and submissions from the parties, the Arbitration Officer upheld the employer's position and confirmed the original rejection by the Corporation of the worker's claim. The worker did not accept the outcome of the arbitration and sought a judicial determination of the dispute. The employer had by then gone into receivership and the receiver did not wish to take part in the judicial determination. However, the Corporation wished to do so and moreover, notwithstanding the conclusion that it had reached upon a reconsideration, it sought to revert to its original position, that is, to reject the worker's claim. The worker submitted that it was not permissible for the Corporation to do so. In that context, the following issues were referred to the Full Bench:-

"1. Whether the Corporation, having originally determined a claim (on reconsideration) in favour of the worker, is bound by that determination in all subsequent proceedings in the Tribunal.

1. 2. Where another party, i.e. the employer, at arbitration successfully disputes the Corporation's determination, does the Corporation have locus standi at judicial determination, and if it has, is it entitled to take a position contrary to its own redetermination (sic-'reconsideration' was presumably intended)."

1. The majority answered those questions as follows:-

"(1) A distinction has to be drawn between proceedings in the Tribunal in respect of the subject determination or proceedings in the Tribunal where a separate determination involving an earlier claim is sought to be relied on. In the latter case the Corporation is not bound by that earlier determination. In the former case the Corporation should be kept to the determination unless just cause is shown by the Corporation why it should depart from it viz, fraud or obvious mistake.

(2) The Corporation does have locus standi in the circumstances, but only to reiterate its position save where just cause is shown entitling it to depart from the position reached in the determination." (emphasis added ours)

1. We return to the facts in this case.
2. The position reached in the initial determination was that the worker suffered disfigurement and was entitled to lump sum compensation on account thereof. The position reached in the reconsideration was that the initial assessment was too low and should be increased to nine per cent. In the schedule of agreed facts, the Corporation acknowledged that even if the worker's loss of function due to disfigurement is to be assessed with a prosthetic eye in place, the worker is nevertheless entitled to an assessment of nine per cent. In the course of the hearing before us, its counsel acknowledged that even if its argument succeeded the assessment should be a greater amount than this.
3. If the Corporation now sought to contend that the worker has no entitlement to compensation on account of disfigurement that would offend the ratio in Wear because it would be a change in its position. Arguably, it would also be a change in position for it to now be contending that the worker should be entitled to some lesser amount of compensation than that which it was prepared to agree to following its reconsideration. However, the Corporation seeks to do neither. What it seeks to do is to abandon the reason why it adopted a more favourable position following its reconsideration. It is not necessary or appropriate for us to define what does or does not amount to a change in position from a prior determination or reconsideration. This exercise will invariably involve an element of judgment that will turn on the relevant facts of the particular case and may defy precise explanation. It is sufficient for us to say that in this case it is our opinion that the argument that the Corporation now seeks to advance as to the proper basis of an assessment of compensation for disfigurement is not a change in position of the type contemplated by the majority in Wear.
4. Accordingly we conclude that the Corporation is permitted to pursue its argument and we now turn to consider it.

The impact of ameliorative measures on an assessment for compensation on account of disfigurement pursuant to s 43 - The parties' submissions

1. Mr Stanley, counsel for the worker, contended that the worker's compensation for disfigurement should be assessed as if there was no ameliorative cosmetic devices used. He said:-

"The underlying legislative purpose is to compensate the worker for the disfigurement the worker suffers by reason of the injury to his or her body, and the only way that that can be assessed is by having regard to the damage that has been done to the body and, to the extent that any device is used to conceal the damage that has been done to the body, it will result in under compensation of the worker and would be contrary to the very purpose of Parliament's intention to fully compensate workers for the disfigurement they suffer as a result of a compensable disability."

"In my submission scarring to the hip or the upper thigh is not necessarily any less severe than it might be to the face simply because of its location on a particular part of the body. What the provision requires is an assessment of the severity of the disfigurement itself, not where it might be located on the body and therefore the frequency with which it might be observed by a third person."

1. Mr Hanus, counsel for the Corporation, contended that because the basis of an assessment for disfigurement pursuant to s 43 involves an assessment of the extent to which an observer would perceive the alteration in the worker's appearance to be negative or displeasing, as was recognised in Holmes v BHP Company Ltd A134 of 1995 and confirmed by the Full Bench of the Workers Compensation Tribunal in Mariniello v WorkCover/Allianz Australia Workers Compensation (SA) Ltd (ETM Constructions Pty Ltd) [2000] SAWCT 182, one cannot ignore the fact that on occasions the worker wears a prosthetic eye and that this has the effect of lessening the displeasure experienced by a third party observer.
2. Mr Hanus acknowledged that the worker did not on all occasions wear a prosthetic eye. He urged upon us an approach that would assess the amount of compensation that would reflect the ameliorative measures that the worker might utilise from time to time in the same way that other assessments pursuant to s 43 of the Act for other disabilities reflect the fact that symptoms might vary in intensity from time to time.

1. We have difficulties with both of the approaches suggested by counsel.
2. The approach suggested by Mr Stanley is, in our view, contrary to the approach adopted by this Tribunal in making assessments of compensation for disfigurement pursuant to s 43.
3. We are entitled to know that a person observing a scar will be less disturbed by a scar which has been largely obscured by makeup than he or she would be by an identical scar which has not been subjected to any ameliorative measures.
4. Parliament has not given any instructions as to how disfigurement is to be assessed. The approach proposed by the Workers Compensation Appeals Tribunal in Holmes v BHP Co Ltd (supra) and adopted by the Full Bench in Mariniello (supra) is an approach that is open on the legislation and we are not persuaded to depart from it.
5. In our view, that approach requires us to make the assessment from the view point of a third party observer, and the views of that hypothetical third party, affected as they will be by any ameliorative measures taken by the worker, cannot be ignored.
6. The difficulty with the approach suggested by Mr Hanus is that it necessarily follows that the amount of compensation to which an individual worker would be entitled on account of disfigurement will vary from worker to worker depending upon the nature and extent of ameliorative measures that are undertaken by that worker.
7. Whilst the individual circumstances of a worker are not entirely irrelevant to an assessment of compensation pursuant to s 43 of the Act, in the sense that the level of compensation is not limited to an objective assessment of the loss of function (see for example Workers Rehabilitation and Compensation Corporation v Lu (1995) 183 LSJS 193), there is an expectation that the amount of compensation awarded in a particular case will be based on some sort of objective yardstick. Accordingly, for example, the amount of compensation payable for a person who has say lost his or her hand will generally be the same whether the worker is male or female, young or old, was a labourer or concert pianist. Notions like pain and suffering and loss of enjoyment of life which underpin the quantification of assessments for general damages at common law and which reflect the individual circumstances of the plaintiff, by and large have no place to play in an assessment of compensation pursuant to s 43.
8. The difficulty that this case presents is how to factor the ameliorative measures that one might expect a worker to implement and yet conform with the general approach to assessments pursuant to s 43 that requires us to pay little regard to the individual circumstances of the worker and to arrive at an assessment that is essentially an objective one.
9. We think the answer lies with the doctrine of mitigation.
10. Although it is arguable, because of the extensive provisions contained in s 36 of the Act that deal with matters that might generally be regarded as falling within the doctrine of mitigation of damages, that s 36 covers the field in relation to the application of that doctrine in so far as it relates to a worker's entitlement to weekly payments of income maintenance, there are sound policy reasons to suppose that it was Parliament's intention that the doctrine of mitigation as discussed by the High Court in Fazlic v Milinginbi Community Inc (1982) 150 CLR 345 at 350 might apply elsewhere.
11. Fazlic concerned a worker's alleged failure to undergo reasonable medical treatment that might have ameliorated the effects of his work related injury. It was argued that this ought to impact upon the worker's entitlement to workers compensation under the relevant Northern Territory legislation. The High Court ultimately ruled against that argument on the basis that:-

"Any assessment of the reasonableness or otherwise of a worker's refusal of treatment must depend upon the worker's state of knowledge at the relevant time. ... A worker's choice cannot be said to be unreasonable because he has failed to give effect to factors unknown to him."

1. The test that the High Court applied in determining whether or not there had been a failure to mitigate was based on the reasonableness of the decision of the worker in the particular circumstances of the case.
2. However, as was noted by Handley JA in Marinko v Masri [1999] NSWCA 364 the somewhat more subjective approach taken in Fazlic probably reflected the fact that the mitigation issue there concerned medical treatment. The learned judge said at par 23:-

"The ordinary legal test of what is reasonable in the circumstances is objective and most of the cases dealing with mitigation of damage have considered that issue objectively...".

1. In keeping with the general approach to s 43 assessments we think that there are compelling reasons to apply such an approach here.
2. Thus, if there are ameliorative measures that are reasonably available to an injured worker to lessen the negative or displeasing feelings experienced by the hypothetical third party observing the worker's disfigurement, in our view, they should be taken into account in assessing the compensation to which the worker is entitled and in determining this an objective test should apply.
3. In other words, a worker is not expected to take extraordinary measures to ameliorate the consequences of disfigurement. However, the worker can be expected to take such measures as objectively might be regarded as reasonable. That may in a particular case be an issue upon which evidence may need to be called. If the worker, for whatever reason, elects not to apply such measures, that will be a matter for the worker, but it will not increase the compensation to which he or she is entitled on account of disfigurement.
4. As was noted earlier, Mr Hanus conceded that even on the approach contended for by the Corporation, the compensation to which the worker was entitled was greater than nine per cent.
5. The figure suggested by the worker, namely 22 per cent is, as we understand it, based upon an assessment assuming that no ameliorative measures are taken by him.
6. For the reasons just explained, we do not think that is a proper basis upon which to make the assessment of compensation in this case.
7. The evidence does not permit us to find what ameliorative measures are reasonably available to a person who has lost an eye to lessen the negative or displeasing feelings that would be experienced by the hypothetical third party observing the disfigurement resulting therefrom and what of those measures that person would objectively be expected to use.
8. In the circumstances, we think the appropriate order is to remit this matter back to a single member of the Tribunal to determine in default of the agreement of the parties the compensation to which the worker is entitled in conformity with these reasons, and we so order.