J Gadsden Pty Ltd and MMI Workers Compensation (Victoria) Pty Ltd v McDonald [1999] VSC 190

5. During the hearing in the Magistrates' Court a medical panel was constituted to deal with the reference of medical questions to it by the presiding magistrate at the request of Gadsden and MMI. The panel was constituted by David Kotzman, Peter Lawthin and Ronald Quirk. It reached decisions on those questions. McDonald issued proceedings in this court to challenge the decision made by the medical panel. This is the first proceeding before me. It was issued prior to the resumption of the hearing before the magistrate where that opinion was to be considered.

8. At the resumed hearing of the claim for compensation on 10 December 1998, the magistrate purported to consider and to apply the panel's opinion and made orders in favour of the applicant for compensation. The defendants, Gadsden and M M I, have appealed from that decision to this court - the second proceeding in this court.

11. It was common ground that it will only become necessary to consider the application by Mc Donald to challenge the medical panel opinion if the appeal by Gadsden and MMI from the magistrate's decision is successful. Accordingly, while both matters were dealt with at the one hearing, the submissions relating to the appeal were put first. I will follow the same approach.

15. McDonald originally made three claims for compensation. The first, dated 10 February 1997, alleged an injury described as sprain of the lower back occurring on 11 December 1996. In March 1997 a second claim was lodged which referred to the same incident and described the injuries as sprain to the lower back and right hip. These first two claims had referred to the "sudden drop of a heavy roller" as the cause of the injury. On 16 March 1998 a third claim was filed which stated under the heading "Injury Details" that the lower back, hip and leg were affected but did not state the nature of the injury or condition. As to the cause of the injury it was stated "injury over a period of time due to the heavy nature of employment".

18. The original applications for compensation were denied and a complaint was filed at the Magistrates' Court on about 29 August 1997 by McDonald seeking compensation in the form of weekly payments and payment of medical and like expenses. The critical paragraphs of the statement of claim were as follows:

"4. The plaintiff, whilst in the course of his employment with the defendant sustained injuries to his back and right hip as a result of the heavy and repetitive nature of his employment over a period of time, and in particular in December 1996. Liability has been denied under cover of letters dated 18 March 1997, 6 May 1997 and 14 April 1998. PARTICULARS OF THE INJURY: (i) Back pain (ii) Right hip pain (iii) Right leg pain (iv) Right buttock pain (v) Right groin pain (vi) Production, aggravation, exacerbation, acceleration and/or deterioration of disc degeneration L2-3, L3-4, L4-5 and L5-S1 disc. (vii) Production, aggravation, exacerbation, acceleration and/or deterioration of osteoarthritis of the right hip. (5) The plaintiff is incapacitated for his pre injury duties as a result of the above mentioned injuries and conditions."

22. The defendants, Gadsden and M M I, served a notice dated 3 March 1998 pursuant to s.45(1) (b) of the Act stating that they would request the Magistrates' Court at the hearing to refer certain medical questions to a medical panel under the Act. Those questions were described as follows:

"(a) What is the plaintiff's medical condition relevant to the injury or alleged injury? (b) Whether the plaintiff's employment was in fact a significant contributing factor to the injury or alleged injury. (c) Whether the plaintiff has a current work capacity or no current work capacity. (d) What employment would or would not constitute suitable employment for the plaintiff?"

26. The matter came on for hearing on 4 August 1998. Counsel for the defendants Gadsden and MMI applied at the outset of the hearing to have the above questions referred to the medical panel for opinion. The learned magistrate declined to refer to questions at that stage. Instead he proceeded to hear evidence relevant to the claim for compensation including medical evidence. The evidence was transcribed. At the conclusion of the evidence on the following day, the learned magistrate invited submissions about whether the proposed questions. should be referred.

29. Gadsden and MMI, the appellants in the appeal before me, have been critical of the course of action followed by his Worship and commented that he should have dealt with the application to refer questions immediately. Whatever may be thought of his Worship's action, the appeal does not raise that question for decision. In view of the vigour of counsels' criticisms, however, some consideration of what occurred and of the practice followed is warranted. It was put, in particular, that the procedure adopted by the learned magistrate effectively subverted that intention of Parliament. Counsel submitted that the effect of the learned magistrates' conduct of the proceeding was that he had inflicted on the parties and community both methods of dispute resolution.

32. The practice followed was considered by Hedigan, J. in HIH Winterthur Workers' Compensation (Vic) Ltd v Greeves, unreported, 2 October 1998) and received qualified approval from him. I endorse his comments. There is a danger that the practice could lead to an erroneous use of the system if a court proceeds too far into an investigation of the facts before referring the questions to a panel. Where to draw the line is difficult to judge. The present case, however, highlights the desirability of the judge or magistrate, and the parties, taking care over the formulation of the questions to be submitted to the medical panel. (See also Community Services Victoria v William Bradbury [1993] VSC 32). The failure to draw questions specific to the circumstances of the case and the consequent reliance upon the broad language of the definitions of various medical questions in s.5 of the Act had the result that the attention of the panel was not directed to the issues that they needed to consider. The appellants, who submitted the questions, share the responsibility for this.

35. A proper supervision of the referral of questions can only assist in the speedy resolution and cost efficient resolution of claims. Anyone with any experience in litigation knows that the formulation of questions to be determined separately from the primary litigation is a difficult task and should not be embarked upon without a proper understanding of the issues in the particular case. It is only then that there is reasonable prospect of avoiding unnecessary cost and delay which can flow from the referral of inappropriate questions to the other tribunal - in this case the medical panel. To that end it will be necessary in some cases to receive evidence before formulating questions. Care must be taken, however, to proceed no further than is necessary for the effective reference of medical questions and the ultimate resolution of the dispute.

38. Returning to the events below, after hearing argument, the learned magistrate ruled that questions 3 and 4 should not be referred because they were not relevant to the issues in the proceedings and that only the first two questions should be referred. Counsel for the appellants were critical of this ruling but conceded that that complaint is academic because as it happened those questions were referred to the panel in any event. His Worship also made a finding that the plaintiff's injury was the aggravation and acceleration of symptoms to the right hip. Again there was criticism made of this decision by the magistrate but it was also said that the issue was not relevant because it appears that the panel was never informed by the magistrate or either party that that finding had been made and the panel performed its function without reference to any such finding.

41. On 12 October 1998, the panel provided its opinion. It gave the following answers to the questions stating that they represented the consensus view of the panel. In answer to the first question they commented:

"The Panel concluded that the Plaintiff was suffering from osteoarthritis of the right hip. He also suffered from a temporary aggravation of degenerative disc disease of the lumbar spine, which had resolved by February 1997."

"In the Panel's opinion the worker's employment could possibly have been a significant contributing factor to the temporary aggravation of degenerative disc disease, but could not possibly have been a significant contributing factor to the osteoarthritis of the right hip."

"the Panel concluded that the plaintiff has a current work capacity"

"The Panel concluded that as a result of the plaintiff's degenerative disc disease and the right total hip replacement, the plaintiff's pre injury duties would not constitute suitable employment, however the panel considered that the quality assurance duties that constituted part of the plaintiff's duties would constitute suitable employment. "

51. Prior to the resumption of the hearing on 10 December 1998, the plaintiff requested and obtained reasons for the opinion of the panel.

54. On the return of the matter before his Worship on 10 December 1998, counsel for the plaintiff called no further evidence and closed the plaintiff's case. Counsel for the defendant then attempted to have admitted into evidence a copy of the medical panel's statement of reasons. It was dated 12 October 1998. It had been prepared by the panel and sent by its convenor to the Magistrates' Court. His Worship refused to receive the statement of reasons into evidence. He said that it was not the magistrate's function to examine the reasons for the opinion or to second guess the panel's processes. Counsel for the defendants then closed their case.

57. Counsel for the defendants submitted that the Magistrates' Court was bound to apply the medical panel opinion and that it was, therefore, obliged to find that the plaintiff was not entitled to weekly payments of compensation or the payment of medical and like expenses with respect to the injury to the right hip.

61. His Worship then gave an ex tempore judgment. He stated amongst other things that he accepted that the plaintiff's condition was clearly osteoarthritis of the right hip during such time as he had a right hip condition and that that was a clear opinion of the medical panel. I note that there had been a hip replacement operation prior to the hearing. He said that the claim by McDonald was for injury to his right hip and, in particular, as pleaded in the particulars to paragraph four of the statement of claim, concerned the production, aggravation, acceleration, exacerbation and deterioration of osteoarthritis in the right hip. He held that all of those matters fitted clearly into the definition of injury in s.5 of the Act. He found that McDonald's claim was for injury to the hip and in particular the aggravation, acceleration and/or exacerbation of osteoarthritis of the right hip and that it was alleged that he had a pre-existing and quiescent condition of the hip. His Worship said that McDonald's claim was supported by the respondent and its medical witnesses and he accepted it. He accepted that the event in December 1996 when McDonald was forced to suddenly take the heavy weight of a roller on a machine was likely to induce symptoms in the right hip being a process described by Mr Crowe a surgeon. He held that the plaintiff's injury was the recurrence, aggravation, acceleration of osteoarthritis in the right hip which arose out of or in the course of his employment and that the respondent's employment was the sole cause of the aggravation, acceleration and exacerbation etc. He held that it caused the hip to become painful and the condition in the right hip continued for some time so that McDonald was eventually brought to surgery for a hip replacement. Referring to the panel's opinion that McDonald's employment could not possibly have been a significant contributing factor to the right hip he acknowledged that he was bound by that opinion. He held that it was clear on the panel's opinion that the employment of McDonald could not possibly have been a significant contributing factor to the cause of osteoarthritis in the right hip or its condition prior to the injury. He held, however, that if the panel's opinion was that the employment could not possibly have been a significant contributing factor to the alleged injury (that is the aggravation, exacerbation acceleration and/or deterioration), the panel would have said so. He said that it had not done so and that the concept was not a strange one to a medical panel answering questions of the kind put to it. He drew attention to the fact that in his letter of referral he quoted the definition of injury contained in s.5 and had provided a copy of the pleadings where the injury pleaded was the aggravation, acceleration, exacerbation, and/or deterioration of osteoarthritis of the right hip. He concluded that the question of "injury" which was before him had not been answered by the medical panel and was one which he had to address.

64. Thus the learned magistrate construed the opinion of the panel and, in particular, its opinion on the question as to whether employment could possibly have been a significant contributing factor to the injury as being an opinion confined to the issue whether there was such a possibility so far as the condition of osteoarthritis was concerned and not the symptoms that manifested themselves as a result of that condition.

67. The appellants Gadsden and M M I obtained orders from the Master spelling out the questions of law alleged to arise on the appeal from his Worship's decision. They were stated to be the following:

"(a) Did the learned magistrate err in law in failing to adopt the Medical Panel opinion that the respondent's employment with the first named appellant could not possibly have been significant contributing factor to the alleged injury to the right hip; (b) Alternatively, did the learned magistrate err in law by purporting to adopt the Medical Panel opinion but finding that the Respondent's employment with the First named Appellant was a significant contributing factor to the alleged injury to the right hip; (c) Did the learned magistrate err in law in failing to admit into evidence the Medical Panel's statement of reasons?"

72. The medical panel's opinion was sought pursuant to s.45 of the Act. It provides -

(1) Where the County Court exercises jurisdiction under this Part, the County Court -

(a) may refer a medical question; or

(b) if a party to the proceedings requests that a medical question or medical questions be so referred, must refer that medical question or those medical questions -

to a Medical Panel for an opinion under this Division.

(2) If the County Court refers a medical question to the Panel, the Court must give each party to the proceedings, copies of all documents in the possession of the Court relating to the medical question.

(4) If the County Court refers a medical question to a Medical Panel, the Court must give a copy of the Panel's opinion to the worker and to the employer, Authority, authorised insurer or self-insurer and may gave a copy to a party to the proceedings."

79. Section 43 of the Act confers the same powers on Magistrate Courts.

82. Section 68 deals, inter alia, with the time within which and the form in which the medical panel expresses its opinion and makes such opinions binding on "any court".

(1) A Medical Panel must form its opinion on a medical question referred to it within 60 days after the reference is made or such longer period as is agreed by the Conciliation Officer, the County Court, the Authority, authorised insurer or self-insurer.

(2) The Medical Panel to whom a medical question is so referred must give a certificate as to its opinion.

(3) Within seven days after forming its opinion on a medical question referred to it, a Medical Panel must give the relevant Conciliation Officer or the County Court or the Authority, authorised insurer or self-insurer its opinion in writing.

(4) For the purposes of determining any question or matter, the opinion of a Medical Panel on a medical question referred to the Medical Panel is to be adopted and applied by any court, body or person and must be accepted as final and conclusive by any court, body or person irrespective of who referred the medical question to the Medical Panel or when the medical question was referred."

89. Section 48 addresses the question of the admissibility of certificates and report from the panels.

"48(1) A certificate or report given by a Medical Panel is admissible in evidence in any proceedings under this Act. (2) A member of a Medical Panel is competent to give evidence as to matters in a certificate or report given by the Medical Panel of which he or she was a member, but the member may not be compelled to give any such evidence."

94. The appellant submitted that the opinions of the panel should have been adopted and applied in their terms and accepted as final and conclusive. They argued that the learned magistrate failed to adopt and apply the opinions in their terms. It was put that the opinions given were given in answer to valid questions and it was improper to weigh such opinions against other evidence taken in the proceedings having regard to the terms of s.68(4) of the Act. They argued that the opinion of the panel was that there had been a temporary aggravation of the back condition where employment could possibly have been a significant contributing factor but that that aggravation had resolved by February 1997. They argued further that the panel expressed the opinion that the hip condition was a pre-existing arthritis in respect of which employment could not possibly have been a significant and contributing factor. They submitted that the opinions expressed were properly responsive answers to the questions citing Smith v Mann and others [1932] HCA 30; (1932) 47 CLR 426 at 450 - 2, where Dixon, J. stated that it is sufficient if a medical panel makes its conclusion or opinion reasonably clear having regard to the language of the question and opinion and the circumstances of the case (at 452). They argued that the opinion in this instance was abundantly clear and there should have been no resort to any other evidence received by the court in the proceedings. They submitted that in failing to adopt an apparently regular certified panel opinion, the magistrate failed to observe requirements of s.68(4) and so fell into legal error.

98. In the alternative the appellants submitted that if there was any ambiguity in the answers, then it was relevant to consider the reasons that were proffered by the appellants below or, alternatively, to seek clarification from the panel. Counsel relied upon English authority from earlier this century dealing with the system then in place in England where a medical referee was used under the then Workers' Compensation Scheme to give certified opinions on referred questions. Reference was made to Wilson's v. Clyde Coal Co [1929] AC 651, 658; Connor v. Cadzow Coal Co [1932] AC1; and Penrikyber Navigation Colliery v. Edwards [1933] AC 28. Under the United Kingdom legislation the certificate of the referee was conclusive. The above mentioned authorities, however, support the principle that clarification may be sought by the relevant court from the referee of the relevant certificate. It was put that once the explanation was to hand, the matter would then be resolved upon interpretation of the certificate in light of the clarification. It was submitted that these authorities support the conclusion that it would be relevant to consider the reasons or alternatively to seek clarification in the absence of the reasons from the panel.

102. Counsel for the respondent to the appeal submitted that the appellant's primary submission involved a confusion of terminology. They submitted that it was important to bear in mind the nature and extent of the three claims that were included in the claim forms. Particular attention was drawn to the fact that there was no mention of osteoarthritis in the claim form. They then submitted that when one looked at the statement of claim in the proceedings in the Magistrates' Court, the matters complained of were not confined to osteoarthritis but concerned the aggravation and exacerbation and development of a painful condition in the right leg, hip, buttock and groin. Counsel then referred to the transcript of the proceedings before the magistrate drawing attention to parts of the evidence where reference was made to the aggravation of the symptoms following the incident (pp.89, 10, 12, 74, 75, 76, 112, 115, 145).

105. Counsel made telling criticisms of the questions and their lack of specificity, criticisms that support the views that judges of this Court and judges of the County Court have expressed about the desirability of judges and magistrates hearing such claims retaining control over the time when the questions should be referred and their form. (See HIH Winterthur Workers' Compensation (Vic) Ltd v. Greeves, Hedigan, J, unreported, 2 October 1998, concerning the present s.45 and Austin v. Amcor Ltd, Byrne, J, unreported, 3 April 1998 and the County Court judgments of their Honours Judges Strong and Williams he cites addressing the predecessor to the present s.45.)

108. Turning to the critical question referred to the panel (question two) counsel submitted that, while the question was cast in very broad terms, the answer to it was quite clearly an answer that focused so far as the allegation of injury to the hip was concerned on the osteoarthritic condition of the hip and failed to address the question of the alleged injury in all its aspects. In other words the panel considered merely whether the event or events complained of could possibly have caused or contributed to the osteoarthritic condition of the hip. Counsel submitted that the answer to that question was in the negative and the magistrate was obliged to apply that opinion and did so. The panel, however, did not consider the broader question of the pain in the region of the hip and whether it resulted in incapacity to work and required radical medical treatment in the form of a hip replacement operation. They submitted that injury for the purpose of the Act included pain from the aggravation or exacerbation of a quiescent physical condition citing Federal Broom Company v Senlitch (1966) 110 CLR Kitto, J. at 632-4 and Windeyer, J. at 639-40. The panel not having addressed the question in its entirety, the learned magistrate was not bound by any opinions as to the other aspects of the injury because none had been expressed. It was conceded, however, that it would have been open to the appellants to request the magistrate to draft a further question or to ask the magistrate to ask the panel to complete its answers to the question on the question of pain as injuries.

111. As to the alternative submission, McDonald submitted that the magistrate was bound to apply the opinion given and it was only when on its face it was ambiguous, that further information could be obtained. It would need to be ambiguous on its face and the ambiguity could not be created by consideration of any reasons that were published. Counsel further submitted that if there was uncertainty in the opinion, the magistrate should have returned the matter for a further opinion. If the opinion was clear but limited, the magistrate should apply it according to law. The respondent also submitted that in any event the reasons would not have been relevant and admissible because the Act directed the magistrate to the "opinion" and it was on the "opinion" that he was obliged to act. Thus it was put that even if there was an inconsistency between the opinion and the reasons, the opinion was to be applied. It would stand until a court such as the Supreme Court had ruled that the opinion was for any reason to be set aside but they submitted that the reasons not being admissible or, if admissible, not able to be acted on by the magistrate, he was obliged in the case of ambiguity to do the best he could or to send the matter back to the panel to answer further questions.

115. Turning then to the principal issue - the construction to be placed upon the expression of opinion - it seems to me that the learned magistrate was correct in his analysis. It is plain that the panel assumed that, so far as it was concerned, the injury alleged was the osteoarthritic condition of the hip and not the wider injury that was raised in the claims and pleaded in the statement of claim. It is plain that it confined its opinion to the question of the likely causes of the osteoarthritic condition and did not apply its mind to the question of the potential contribution made by the incident or general wear and tear of employment to the aggravation or exacerbation of the symptoms arising from the osteoarthritis and which had the result of disabling Mr McDonald and led to the hip replacement operation.

118. As to the alternative submission, I also accept the arguments advanced for McDonald. There is no place under the statutory scheme for the opinion to be reconsidered by the magistrate in the light of any reasons. The Act makes it clear he is to act upon the opinions expressed. If there is any error of law contained in such an opinion which is revealed by the reasons, that is a matter to be taken up in a superior court where application might be made to set aside the opinion (Masters v McCubbery [1995] VICSC 209; [1996] VR 635, 655-6). The reasons would be admissible in such an application as s.10 the Administrative Law Act 1978 makes the reasons part of the record for the purpose of prerogative relief.

121. If the above be incorrect, I note that in any event the appellants Gadsden and MMI have not placed any material before me to suggest that the reasons were tendered for any purpose other than to supply additional evidence as to the opinion of the panel. They were proffered to the magistrate during the giving of evidence and, there being nothing in the material to suggest otherwise, it is reasonable to infer that at no time was it suggested to the learned magistrate that, there being some ambiguity in the terms of the opinion it would be relevant to consider the reasons. Further, even if the reasons were to have been considered, I accept the submissions of the respondent McDonald that they confirmed the construction of the opinion made by the learned magistrate.

125. For the foregoing reasons the appellants' appeal should be dismissed. It is unnecessary then to consider the application of Bruce McDonald to challenge the opinion of the panel and I will refrain from considering that matter. I invite further submissions from counsel as to the appropriate forms of orders and appropriate orders as to costs in the matter.