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[2013] NSWSC 1489
Supreme Court of NSW
2013-02-01
Hidden J
Original judgment source is linked above.
Judgment 1HIS HONOUR: Between 21 July 2006 and 31 March 2009, the first defendant, Valentina Lakovska, was employed by the plaintiff, Inghams Enterprises Pty Limited, as a process worker. The plaintiff, to which I shall refer as "Inghams", is the well known purveyor of chickens for human consumption. On 31 March 2009, Ms Lakovska suffered a back injury while bending over to pick up a chicken from the floor beside a conveyor belt. She sought compensation, invoking the machinery established by the Workplace Injury Management Workers & Compensation Act 1998. In due course her claim was referred for medical assessment under ch 7, Pt 7 of that Act and, eventually, after her successful appeal to an Appeal Panel constituted under that Part, her whole person impairment was assessed at 15%. 2Inghams challenges that decision and seeks prerogative relief in this court. By an amended summons it claims orders that the decision be quashed and that the matter be remitted to the Registrar of the Workers Compensation Commission for referral to an Appeal Panel for redetermination. The second and third defendants are the Appeal Panel and the Registrar, and each has entered a submitting appearance.
Background 3The process by which the matter came before the Appeal Panel is somewhat convoluted, but I shall refer only to those steps which are necessary to understand the issues at hand. Consistently with the approach of the parties, and the Appeal Panel, I shall use the acronyms with which this area of the law abounds. 4On 28 October 2010, an application to resolve a dispute ("ARD") was filed in the Commission on behalf of Ms Lakovska. Inghams admitted liability, but the extent of her impairment remained in dispute. On 29 July 2011 the registrar, pursuant to s 321 of the Act, referred that dispute to an approved medical specialist ("AMS") for assessment of Ms Lakovska's degree of permanent impairment as a result of the injury and the extent, if any, to which any proportion of that impairment was due to any previous injury or pre-existing condition or abnormality. 5The AMS was supplied with statements of Ms Lakovska and medical reports obtained on her behalf and by Inghams, and he examined her. He concluded that at the time of the incident giving rise to her injury she was suffering from a degenerative spinal condition. That being so, s 323 of the Act required him to reduce the whole person impairment ("WPI") which he found following the injury by the proportion to which that impairment was attributable to that degenerative condition. Having found a WPI of 15%, he reduced it by one tenth on account of the degenerative condition to produce a rounded figure of 14%. Pursuant to s 325, on 15 September 2011 he issued a medical assessment certificate ("MAC") accordingly. 6It appears that at the time of his assessment the AMS was not in possession of all the medical material he should have had. Accordingly, the registrar referred the matter back to him for reconsideration, in accordance with s 329 of the Act. This led him to reassess the extent to which a pre-existing condition contributed to the WPI. He found it to justify a deduction of 50%, producing a rounded WPI of 8%. On 22 November 2011 he issued a further MAC to that effect, referred to in the reasons of the Appeal Panel as "the final MAC." By s 329(2) that MAC prevailed over the previous certificate and, accordingly, it was that final MAC which was the subject of Ms Lakovska's appeal to the Appeal Panel. 7Provision for that appeal is to be found in s 327 of the Act. By subs (3) such an appeal may be brought on any of the following grounds: "(a) deterioration of the worker's condition that results in an increase in the degree of permanent impairment, (b) availability of additional relevant information (but only if the additional information was not available to, and could not reasonably have been obtained by, the appellant before the medical assessment appealed against), (c) the assessment was made on the basis of incorrect criteria, (d) the medical assessment certificate contains a demonstrable error." 8Section 327(4) requires an appeal to be made by application to the registrar. The subsection continues: "The appeal is not to proceed unless the Registrar is satisfied that, on the face of the application and any submissions made to the Registrar, at least one of the grounds for appeal specified in subsection (3) has been made out." The effect of that somewhat surprisingly worded provision is that for an appeal to proceed the registrar must find that at least one of those grounds is arguable. In the present case, the Registrar expressed satisfaction that the ground of appeal specified in subsection (3)(d), that the MAC contains a demonstrable error, was made out in relation to the deduction "for previous injury, pre-existing condition or abnormality pursuant to s 323" of the Act. 9By s 328(1), an Appeal Panel is constituted by two approved medical specialists and one arbitrator, chosen by the registrar. Subsection (2), which is critical in the present case, provides: "(2) The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made. ..." By subs (5), the Appeal Panel may confirm the MAC appealed against, "or may revoke that certificate and issue a new certificate as to the matters concerned." 10The same subsection provides for the establishment of the procedure on an appeal by WorkCover Guidelines, for which provision is made by s 331. Clause 45 of the relevant Guidelines enables an Appeal Panel to adopt any of the following procedures, according to the needs of the individual case:
18Inghams maintained its position that the only injury relied upon by Ms Lakovska was a frank injury of 31 March 2009. However, the Panel noted that the injury claim was "to 31.03.09" and was expressed to be due "to the tasks she undertook in her employment", occurring "over the course of time." This was found to be consistent with her statements. 19The Panel considered it necessary to make its own diagnosis and, having reviewed all of the material, concluded that the symptoms Ms Lakovska suffered following the incident of 31 March were "the result of a disc herniation at L4/5." The Panel also concluded that "in all likelihood" the work which she had been doing over the period preceding 31 March "resulted in a progression of radial tear or tears" in the L4/5 disc which proceeded to a herniation "following a relatively simple task" which she did on that day. 20The Panel was of the view that there were probably degenerative changes at all levels of Ms Lakovska's spine, not revealed by radiological investigations, but considered them not to be clinically significant and not contributing to her permanent impairment. It found that the pre-existing degenerative condition at the L5/S1 level, which was revealed by radiological investigations, did not of itself warrant a deduction under s 323. It concluded that her permanent impairment was due "entirely to the residual features of her discal injury at L4/5," and that the evidence demonstrated no relevant "pre-existing disease or condition at her L4/5 level." Accordingly, as I have said, the AMS's finding of a degenerative condition contributing to her impairment was held to be a demonstrable error.
The application in this court 21In explaining its role, the Appeal Panel referred to the decision of the Court of Appeal in Siddik v WorkCover Authority of NSW [2008] NSWCA 116. It added at [40] and [43] of its reasons: "[40] The Court held that an appeal by way of review may, depending upon the circumstances, involve either a hearing de novo or a re-hearing. Such a flexible model assists the objectives of the legislation. ... [43] In this matter the Registrar has determined that she is satisfied that at least one of the grounds of appeal under section 327(3) is made out. The Panel has accordingly conducted the review of the material before it and reached its own conclusion concerning the correct assessment on the impairments and losses suffered by the [appellant]." 22What the Panel did not note is that, following the Court of Appeal's decision, the legislation was amended. I have referred at [9] above to s 328(2) of the Act. At the time Siddik was decided, the relevant part of that subsection provided simply that the appeal was to be "by way of review of the original medical assessment." It was an amendment effected by the Workers Compensation Legislation Amendment Act 2010 which added the words which now appear in the subsection, "but the review is limited to the grounds of appeal on which the appeal is made." It was the amended subsection which applied to the present case. 23In Siddik, the WorkCover Authority had appealed to the Appeal Panel against an MAC. The Panel rejected the two grounds of the appeal which the Registrar had permitted to be argued, but allowed the appeal upon a basis which had not been articulated in those grounds. Put shortly, the Court of Appeal held that (as the legislation then stood) it was open to the Panel to take that course provided the dictates of procedural fairness were met. The parties had not been given an opportunity to be heard on the basis on which the appeal was allowed and, accordingly, the matter was remitted to the Appeal Panel. 24The leading judgment was given by McColl JA, with whom Mason P and Giles JA agreed. At [59] ff her Honour examined the nature of a review under s 328 by reference to the notion of an appeal by way of rehearing or hearing de novo, particularly in the administrative context, and also to other provisions for review in Workers Compensation legislation. For present purposes, it is sufficient to set out portions of that judgment in which her Honour expressed her conclusions (most references to authorities omitted): "[94] The legislature has confined appeals to matters that are appealable only on the grounds identified in s 327(3). Permission must be obtained before the putative appellant can appeal. To obtain permission, at the time of the present case, the putative appellant had to establish that one of the s 327 grounds existed. Although the appeal was "by way of review of the original medical assessment", if the Appeal Panel did not confirm that MAC, its only power was to revoke it and "issue a new certificate as to the matters concerned". "The matters concerned" were not expressly identified, but contextually their apparent subject was the "matter" the subject of the appeal identified by the appellant in accordance with s 327(1). [95] Section 327(3)(c) and (d) permit an appellant to attack the MAC on the basis of errors on the part of the AMS. That suggests, in my view, a jurisdiction to revoke the MAC which is only exercisable in the event error is identified in it, in other words an appeal by way of review which has indicia of an appeal by way of rehearing. [96] However s 327 is not only an error-based jurisdiction. It also contemplates an appeal arising because of changed circumstances: either a deterioration of the worker's condition or the availability of additional relevant information (being evidence that was not available to the appellant before the medical assessment appealed against or that could not reasonably have been obtained by the appellant before that medical assessment): s 327(3)(a) and (b). While the power to receive further evidence is suggestive of a rehearing function ..., the availability of that power to what might be classed as an administrative body is not determinative: ... . [97] In such circumstances the Appeal Panel might be expected to review the MAC to determine whether the changed circumstances affect the conclusions the AMS reached. If it reaches that conclusion, then it must have the power to conduct the assessment anew, including, if necessary, undertaking an examination of the injured worker as contemplated by s 324. That appears to presume something in the nature of a hearing de novo ... . [98] Further, while the express limitations on opening the gate to an appeal are suggestive of an appeal limited to the grounds identified by the appellant, there is much to be said for the view that when used in the context of the review of an MAC by a panel including two specialists, that they should be entitled to determine "the true and correct view": [a reference to State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249, per Spigelman CJ at [30]]. The purpose of setting up a panel with experts is to enable it to resolve questions within its expertise: ... . [99] Such an approach recognises the importance of the medical assessment in the process of determining an injured worker's rights to, and an employer's obligation to pay, workers' compensation and/or damages. Although the legislature has deliberately separated determination of those issues from the curial decision-maker, it would be a curious to find it intended that the Appeal Panel could not cure an error in a conclusive certificate merely because the parties had not identified it, with the result that a court could be required to determine the parties' rights on the basis of what, in the Appeal Panel's view, was an erroneous MAC. The inclusion of two specialists on the Appeal Panel must have been intended, in part, to permit them to bring their expertise to bear on the contents of the MAC. [100] While a conclusion that an appeal by way of review may, depending on the circumstances, involve either a hearing de novo or a rehearing invokes a novel form of appeal, it ensures the legislature has created a flexible model which as I explain below assists the objectives of the legislature. ... . [101] In my view it is inappropriate to resolve the issues by applying prescriptive labels to the nature of the s 328 review. I am, however, of the view that while prima facie the Appeal Panel is confined to the grounds the Registrar has let through the gate, it can consider other grounds capable of coming within one or other of the s 327(3) heads, if it gives the parties an opportunity to be heard. ... ." 25Plainly enough, the amendment to s 328(2) was directed to her Honour's conclusion at [101] that the Panel could consider grounds other than those which had been referred to it by the Registrar. Subject to that, however, her Honour's explanation of the nature of a review under the section remains apposite. Relevant for present purposes is her conclusion at [95] that the grounds under s 327(3)(c) and (d), the use of incorrect criteria or demonstrable error, point to an appeal by way of rehearing, in which error must be identified. 26Counsel for Inghams, Mr Cameron Jackson, sought prerogative relief on three grounds:
The scope of the review 27Mr Jackson noted that the ground of demonstrable error referred to the Panel by the Registrar was particularised in the application to appeal by the specific grounds set out at [15] above. He referred to the explanatory memorandum accompanying the amending bill, which described as one of its objects "to make it clear that an appeal against a medical assessment is limited to the grounds on which the appeal is made and is not a review of any other aspect of the medical assessment." 28Mr Jackson maintained Ingham's position that the injury of which Ms Lavoska complained, and which the AMS found, was a frank injury sustained as a result of the incident of 13 March 2009. The specific grounds of the application to appeal, he argued, were consistent with that approach. Nowhere in that application was there articulated a complaint that the AMS should have found impairment arising from the tasks she undertook in her employment over a period of time. 29That being so, he argued, the Panel had ranged beyond the grounds of the appeal. In so doing, he added, the Panel erroneously had treated the appeal as a hearing de novo rather than a rehearing. He referred to the passage in [43] of its decision, which I have set out at [20] above. He said that the Panel did indeed review the material and reach its own diagnosis, as it said it would in [53] of its reasons. 30Certainly, on the issue whether Ms Lakovska's work related injury was sustained on 31 March 2009 or developed over a period of time, the material is not consistent. The description of the injury, which I have set out at [16] above, points to a developing condition. The reference "to 31.03.09" (my emphasis), conveys a developing condition from an unspecified outset to 31 March. Moreover, in what follows there is no reference to an incident on that date but, rather, to "the nature and conditions of employment with machine controlled pace of process lines ... ." In addition, in a statement of 7 September 2009, Ms Lakovska described her experience of working on the process line and the "work pressure" which that involved. In a statement of 18 March 2011 she described developing a condition in her low back and left leg "due to the heavy nature and conditions of the work at Inghams ... ." However, in context, this may be no more than a reference to the 31 March injury. 31In a report of 2 June 2011 the surgeon, Dr Abraszko, recorded that she had performed surgery "with respect to the injury sustained by Ms Lakovska, due to the nature and condition of employment from July 2006 to 31 March 2009." Otherwise, the medical reports appear to be based only on the incident of 31 March, rather than a work related condition developing over time. Certainly, none of them refers to the "progression of radial tear or tears", which the Panel considered was likely to have proceeded to a herniation of the L4/5 disc. Clearly, that was the Panel's own diagnosis. 32I have not found this matter easy to resolve. I can see the force of Mr Jackson's arguments, but I am persuaded by the submissions of Ms Margaret Allars, counsel for Ms Lakovska, that they must be rejected. I accept her argument that, properly understood, the passage from the Appeal Panel's reasons at [43] does not point to a hearing de novo but, rather, to a review with the purpose of detecting error and, if error be found, correcting it. What the Panel had to say about Siddik at [40] is derived from the judgment of McColl JA at [100] of that decision. The Panel was referring to Siddik insofar as it provided guidance to their approach of determining the ground of appeal which had been referred to it. It could not fairly be said that the Panel was proceeding in ignorance of the amendment to s 382(2) after the decision in Siddik. 33The Panel diagnosed a developing work related condition which manifested itself in the incident of 31 March. While that was not the diagnosis of the AMS, or of the practitioners who provided reports (with the possible exception of Dr Abraszko), it was consistent with the description of the injury complained of from the outset. Of course, that diagnosis was within the expertise of the Panel, given its constitution. As McColl JA observed in Siddik at [98], the "purpose of setting up a panel of experts is to enable it to resolve questions within its expertise ... ." 34More importantly, I am persuaded that the Appeal Panel did not travel beyond the boundaries of the grounds of appeal referred to it. Ms Allars accepted that, for that purpose, one should have regard not merely to the ground as expressed in terms of s 327(3)(d) of the Act, that is, demonstrable error, but to the specific grounds set out in the application for the appeal which particularised it. The gravamen of those grounds was that the AMS fell into error in reducing the WPI because of a pre-existing condition. That is the very error which the Panel identified. While it differed from the AMS as to the mechanism of the injury of 31 March, the critical question for the purpose of s 323 of the Act was the extent, if any, to which the resulting impairment was due to any previous condition. The AMS had made a deduction because of his finding of a pre-existing degenerative condition. The Panel's examination of the material before him led it to conclude that there was no such condition warranting a deduction in accordance with the section. I might add that, on the medical evidence, that conclusion was open even if the Panel had proceeded on the basis of a frank injury. 35In all the circumstances, I am satisfied that the Panel treated the appeal as one by way of rehearing, conducting an appropriate examination of the error complained of. This ground is not made out.
Assessment hearing/denial of procedural fairness 36The remaining grounds of this application can be dealt with together. Provision is made in cl 46 of the Guidelines for an assessment hearing, at which the parties appear before the Panel to present oral submissions. Relevantly for present purposes, such a hearing would be arranged where a Panel determines that the matter is not capable of determination on the papers. 37In the present case the Panel declined an assessment hearing, explaining in its decision that it was seized of all the relevant material, including the written submissions filed in relation to Ms Lakovska's application for the appeal and in response to the Panel's invitation for further submissions concerning the matters I have set out in [17] above. It considered itself "to be comprehensively aware of the matters it has to address in the appeal" and did not consider that it "needs to hold an Assessment Hearing so as to hear oral submissions from the parties regarding what matters need to be addressed." It also noted the capacity of the specialist doctors on the Panel to understand the clinical records in evidence for the purpose of considering the issue at hand. 38Mr Jackson submitted that, whatever might have been the Panel's competence to master the material, it failed to have regard to the expressed desire of a party to assist it with oral submissions. Plainly enough, however, the decision to hold an assessment hearing is a matter within the discretion of the Panel, guided by the question posed by cl 46, whether the matter was capable of determination on the papers. That is the question which it addressed. 39In reality, this ground overlaps with the third ground, that is, the asserted denial of procedural fairness. Plainly enough, the issue sought to be addressed at an assessment hearing was whether Ms Lakovska's impairment was the result of a frank injury on 31 March 2009 or a condition developing through the course of her employment. However, that was the very matter which the Panel raised with the parties after its preliminary review. For the reasons I have identified when dealing with the first ground, that was not a new issue which the parties had not had an opportunity to address. In any event, the Panel invited further submissions upon it and that invitation was taken up. In those circumstances there was no denial of procedural fairness and, in my view, the matters raised by Mr Jackson in support of these two grounds do not warrant the grant of prerogative relief. 40Accordingly, the summons is dismissed. If necessary, I shall hear the parties on costs.
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Inghams Enterprises Pty Limited
Valentina Lakovska