PUBLISHED THE 27TH DAY OF SEPTEMBER**, 1999.**

Judicial determination - Preliminary points - Issue estoppel - Res judicata - Distinction between two concepts - Whether issues in further claim ventilated and determined previously - Whether abuse of process - Question of member having jurisdiction to hear preliminary point - Ambit of claim - Weekly payments - Section 32 expenses - Ss.32, 36, Workers Rehabilitation and Compensation Act, 1986.

Port of Melbourne Authority v. Anshun Proprietary Ltd. [1981] HCA 45; (1981) 147 C.L.R. 589 at 597.

Rogers v. The Queen (1994) 181 C.L.R. 251 at 262.

Skinner v. WorkCover Corporation/MMI Compensation (S.A.) Ltd. (Tocoda Pty. Ltd.) J.D.16/1998.

Iosiv Cristea v. The Corporation (CCA Snack Foods (Smith Food Co.)) (Supreme Court of South Australia) S.4356 at p.4.

Mitsubishi Motors Australia Ltd. v. Harboard and Another (Supreme Court of South Australia) 69 S.A.S.R. 75 at p.82.

Preliminary points of res judicata, issue estoppel and abuse of process have been raised by the respondent (`the Corporation'). The Corporation asserts that the applicant worker (`the worker') is estopped from continuing the current proceedings on the basis that the issues therein have been previously decided.

The worker initially injured his neck at work on 12 October 1988 when he fell from scaffolding on the Myer Remm building site. He was off work for 2½ months. His claim for compensation was accepted. He returned to work. His general practitioner Dr. Butcher subsequently issued a certificate of clearance in respect of his neck condition on 10 October 1990.

On 22 March 1994 the worker presented to Dr. Butcher complaining of worsening headaches. Dr. Butcher issued a certificate noting that the worker `has suffered frequent headaches in the occipital region since accident' on 12 October 1988. The certificate also noted that the worker was not severely incapacitated and recommended a management plan which Dr. Butcher's later report of 1 June 1994 explained:-

`Pain relief with analgesics and I would like to refer him for physiotherapy if/when WorkCover agree to cover the accounts. In the past he has had relief from physiotherapist Donna Wallace. I believe further physiotherapy treatment for up to 6 months would aid him a great deal and allow him to be seen as fit for normal.' (Book of Documents p.10)

On 30 March 1994 the worker lodged a further claim for compensation referring to his past injury in November 1987, but presumably meaning his work injury on 12 October 1988. This claim was accepted, apparently in October 1994, although there is no documentation before me regarding this acceptance. Weekly payments were made to the worker until February 1996 when they were discontinued pursuant to a Section 36(1)(b) notification which relied on a certificate issued by Dr. Butcher. The worker disputed the Section 36 discontinuance. After hearing evidence, Review Officer Le Poidevin upheld the discontinuance of weekly payments. The worker appealed to the Workers Compensation Appeal Tribunal. There Deputy President Thompson dismissed the worker's appeal.

On 29 September 1997 the worker apparently lodged a further claim for compensation asserting chronic pain/depression affecting his mind/left shoulder/neck arising from his injury on 12 October 1988. His claim form was not in evidence before me. By determination dated 2 June 1998 the Corporation rejected the worker's claim. By Notice of Dispute filed on 3 June 1998 the worker disputed the rejection of his claim.

The respondent says that by instituting and pursuing this further claim the worker is trying to re-litigate issues that have already been determined against him in the earlier Section 36 proceedings. The respondent says the worker should be prevented from so proceeding on the application of the principles relating to res judicata, issue estoppel and abuse of process.

An initial point of contention arose as to whether I had jurisdiction to deal with these preliminary points. After hearing from counsel and on the application of counsel for the worker, Mr. Saies, I directed pursuant to Section 92D(3) of the Act that the dispute constituting action 3649/99 be referred to immediate judicial determination. Insofar as there may have been any doubt as to my being properly seized of the matter so as to be able to deal with the preliminary points being raised by the Corporation, I am satisfied that the making of this order cleared such doubts.

I turn now to the preliminary points. As a first step, I believe it is necessary to identify the dispute between the parties arising from the Corporation's determination of 2 June 1998. This requires identifying what compensation it is that the worker is claiming. The ambit of his claim and the disability in respect of which he is claiming was not readily apparent on the documents before me. A claim for compensation was apparently lodged by the worker on 29 September 1997, but as noted this was not in evidence before me. The Corporation's determination of 2 June 1998 is itself not a model of clarity. It does not refer to any particular head of compensation.

Mr. Saies indicated in the course of his submissions (tr. p.39-40) that the worker's claim of 29 September 1997 was for Section 32 expenses only. Some doubt was expressed as to whether there might also be a further claim for weekly payments and at my request Mr. Saies undertook to clarify in writing precisely what was the worker's claim. By letter dated 11 August 1999 Mr. Saies advised:-

`Pursuant to the request made by Acting Deputy President McCouaig when this matter proceeded by way of a preliminary argument on 29 July 1999, I advise that I have been instructed by Mr Mercurio of Messrs Xenephon & Co that Mr Spencer now seeks to rely upon the Notice of Work-Related Injury dated 29 September 1997 to pursue a claim for weekly payments of income maintenance for all relevant periods (soon to be identified) since he became unemployed on or about 22 January 1996 to date.

However, it is conceded that when the Notice of Work-Related Injury was originally lodged in September 1997 and up until the recent instructions (referred to above), the claim was confined to reimbursement of section 32 expenses - something which clearly emerges on page 2 of the Request for Judicial Determination dated 26 February 1999 under the heading "Relief Sought on Judicial Determination".'

I note in passing this letter's reference to a Notice of Work-Related Injury, as distinct from a claim for compensation, dated 29 September 1997. The respondent's determination of 2 June 1998, however, refers to a `claim for compensation dated 29 September 1997' and I will assume that a claim for compensation was lodged by the worker on that date.

Mr. Downs has since written to me urging that I ignore Mr. Saies' letter of 11 August 1999, explaining `The reason we say this is that if indeed the matter referred to in Mr. Saies' letter of the 11 August 199(sic) was raised during the course of argument we would have resisted the same by way of argument of estoppel by conduct'.

I am satisfied that the worker's claim of 29 September 1997 was a claim only for payment of Section 32 expenses. In the words of Mr. Saies (tr. p.38), this has been the basis upon which the worker's claim has proceeded through the Tribunal to date. Details of the Section 32 expenses are unknown. I will, however, deal with the application before me on the basis that the worker may possibly now be able to rely on his claim for compensation dated 29 September 1997 to also pursue a claim for weekly payments.

As a next step, it is necessary to determine what was decided in the earlier proceedings, and what were the relevant and essential findings made by Review Officer Le Poidevin and, on appeal, Deputy President Thompson to reach their decisions.

The earlier proceedings concerned a disputed discontinuance of weekly payments pursuant to Section 36(1)(b), viz. on the ground that the worker had ceased to be incapacitated for work by his compensable disability. Review Officer Le Poidevin upheld the Corporation's determination of 22 January 1996 discontinuing weekly payments. D.P. Thompson rejected the worker's appeal against the Review Officer's decision.

Review Officer Le Poidevin declined to make any finding in respect of the compensability of the worker's non-organic condition, acceding to the submission of the respondent's counsel, Mr. Downs, that he had no jurisdiction in respect of any depressive condition. Review Officer Le Poidevin said (Book of Documents p.422):-

`As I have remarked earlier, Dr. Butcher was of the opinion that there was a non-organic aspect to the worker's presentation. I think that is so. Whether it relates to his employment, and in particular the compensable disability (as a sequelae) I am not prepared to find. Even if I did make a finding of fact to that effect, in my view Mr. Downs is correct in his submission. I have no jurisdiction in respect to a depressive condition.

This is a situation similar to that which the Deputy President found himself in the case of GMH v Lu A27/1996. In particular, Deputy President Gilchrist observed that the question is one of fact and said:

"If the sequelae can be said to have merged with the original disability, the compensating authority has no capacity to revisit that issue."

He went on then to consider Monroe Aust v Laszcak (unreported delivered 26 November 1993) No. S4278 where as the original Review Officer, I concluded that the psychological condition viz post traumatic stress disorder had merged with the physical injury. The Supreme Court upheld my view.

Later on at page 5 Deputy President Gilchrist summarised as follows:

"It remains, a question of fact, as to whether the sequelae ought properly be regarded as having merged with the acceptance of the original claim. If it has, then the only issue in respect thereof that can be ventilated on the review of a section 36 Notice is whether or not the worker has recovered from the compensable disability. If the sequelae has not merged in the acceptance of the original claim then the sequelae ought not feature in the review."

In this instance, as Mr. Downs correctly points out, there is no evidence of a depressive/non-organic condition having ever been ventilated by the worker in any formal way. True it may be that there has been oblique reference in some of the medical reports to the possible existence of non-organic factors, however it cannot be said that the worker ever asserted in any formal fashion that he was suffering any recognisable psychiatric/psychological disorder flowing from the compensable disability. For example, it is not disclosed on any prescribed medical certificate or anything else until such time as Dr Bassett presents himself before the Review Panel.

The fact situation here is even more clear than that in Lu's case (Supra). In short, there is no capacity for the worker to ventilate the depressive's (sic) condition as a shield to the section 36 notice. Should he wish to do so, it will be necessary for him to file a fresh claim for compensation etc.

In respect to the organic aspect of the claim viz neck and shoulders, I am not satisfied, on the balance of probabilities, that the satisfaction obtained by the Corporation was unwarranted. The worker has not been able to demonstrate, on the balance of probabilities, that such satisfaction was improperly obtained.

On appeal Deputy President Thompson held that Review Officer Le Poidevin had correctly concluded that the non-organic condition was excluded from his purview. Deputy President Thompson concluded (Book of Documents p.485):-

`The acceptance of Dr. Butcher was the acceptance of a view of the worker as the `whole man'. That view was not susceptible of semantic distinctions between organic/

non organic causes and the further subdivision of non organic into depressive/chronic pain syndrome. In short Dr. Butcher's opinion was that the worker had recovered from the disability. The Review Officer accepted the opinion of Dr. Butcher. The Review Officer was entitled to do that.

There is much force in the submissions which Mr. Downs advanced.

Mr. Kernot said everything that could be said in the Appellant's favour. The Review Officer's findings were amply justified on the evidence. Those findings were reached in a lengthy and carefully reasoned determination and I do not propose to disturb them.

I therefore dismiss the appeal. I order the Respondent to pay the Appellant's costs.'

The majority judgment of Gibbs C.J., Mason J. and Aickin J. in Port of Melbourne Authority v. Anshun Proprietary Ltd. [1981] HCA 45; (1981) 147 C.L.R. 589 at 597 provides succinct descriptions of res judicata and issue estoppel:-

`The distinction between res judicata (in England called "cause of action estoppel") and issue estoppel was expressed by Dixon J. in Blair v. Curran [1939] HCA 23; (1939) 62 C.L.R. 464, at p.532 in these terms: "in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order."

The distinction was restated by Fullagar J. in his dissenting judgment in Jackson v. Goldsmith [1950] HCA 22; (1950) 81 C.L.R. 446, at p.466. His Honour expressed the rule as to res judicata by saying: "where an action has been brought and judgment has been entered in that action, no other proceedings can thereafter be maintained on the same cause of action. This rule is not, to my mind, correctly classified under the heading of estoppel at all. It is a broad rule of public policy based on the principles expressed in the maxims `interest reipublicae ut sit finis litium' and `nemo debet bis vexari pro eadem causa'." His Honour went on to discuss issue estoppel, citing the comment of Dixon J. in Blair v. Curran (1939) 62 C.L.R., at p.531: "A judicial determination directly involving an issue of fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies."

The difference between res judicata (cause of action estoppel) and issue estoppel has been expressed in similar terms in the House of Lords - see Carl Zeiss Stiftung v. Rayner & Keeler Ltd. [1967] 1 A.C. 853, at pp. 913, 964 et seq.

Subject to an examination of the application of the principle in Henderson v. Henderson [1843] EngR 917; (1843) 3 Hare 100 [67 E.R. 313], it is evident from the discussion which has already taken place that this is not a case of res judicata. The rule as to res judicata comes into operation whenever a party attempts in a second proceeding to litigate a cause of action which has merged into judgment in a prior proceeding. Here the indemnity cause of action was not litigated in the Soterales proceedings. The judgment in that case did not deal with that cause of action, though it evidently proceeded on the assumption that the Authority was not entitled to an indemnity.'

Not all findings of fact will attract issue estoppel. Brennan J. in Rogers v. The Queen (1994) 181 C.L.R. 251 at p.262 noted as follows:-

`Issue estoppel extends not only to findings of fact or decisions on points of law that are expressly declared in a judgment or order but to any "matter which it was necessary to decide, and which was actually decided, as a ground work of the decision itself, though not then directly the point at issue (Reg v. Hartington Middle Quarter (1855) E1. & B1 780, at p.794 [1855] EngR 264; [119 E.R. 288, at p.293]; Blair v. Curran (1939), 62 C.L.R., at p.532)." But issue estoppel does not extend to findings of fact which, though contested and probative of the ultimate issue, are not necessary to, or are not the legal foundation of, the decision made (Blair v. Curran (1939) 62 C.L.R. at pp.531-533). Stark J. confined the scope of the doctrine in these terms: ibid, at p.510; see Brewer v. Brewer [1953] HCA 19; (1953), 88 C.L.R. 1, at pp.14-16:

"A judgment is conclusive evidence not merely of the facts directly decided but of those facts which are necessary steps to the decision - so cardinal to it that without them it cannot stand." (Emphasis added)'

Res judicata can have no application in this matter. Res judicata comes into operation whenever a party in a second proceeding attempts to litigate a cause of action which has merged into judgment in a prior proceeding. Whilst there is a degree of imprecision in the meaning of the term `cause of action', there is no suggestion that the worker is now seeking to re-litigate the earlier Section 36(1)(b) dispute which culminated in a finding that as at January 1996 the worker had ceased to be incapacitated for work by his compensable disability. Clearly that decision is not decisive of, if even relevant to, the worker's current claim for payment of Section 32 expenses.

Even if the worker's current claim was to be taken as one for weekly payments, the earlier decision cannot be decisive of his present claim for a finding that a compensable disability has ceased to be incapacitating at a certain point of time does not result in the issue of incapacity in respect of that disability being closed for all time. Deputy President Gilchrist determined as much in Skinner v. WorkCover Corporation/MMI Compensation (S.A.) Ltd. (Tocoda Pty. Ltd.) J.D.16/1998 where, at p.3, he said:-

`A finding that a compensable disability has ceased to be incapacitating at a certain point in time does not result in the issue of incapacity in respect of that disability being closed for all time. The worker who had ceased to be incapacitated might then suffer a spontaneous relapse in circumstances that have not broken the causal link with the original compensable disability, and which result in a further period of incapacity for work. I think it clearly follows from the decision of Judge Cawthorne D.P. in Pasminco Metals-B.H.A.S. v. Loleit A.91/1994 and the authorities referred to therein, that in those circumstances the worker would be entitled to compensation.

In my view the only impediment created by a finding that a worker ceased to be incapacitated is that the worker would have to establish that there had been a change in circumstances subsequent to that finding, because otherwise there would be the potential for there to be a decision which conflicts with an earlier decision: Port of Melbourne Authority v. Anshun Pty. Ltd. [1981] HCA 45; (1981) 147 C.L.R. 589 at 603.'

For similar reasons, issue estoppel cannot apply. The earlier finding that the worker had as at January 1996 ceased to be incapacitated for work by the compensable disability stands as a conclusive finding of that fact. The worker would be estopped now from contending otherwise, for to do so would be to open the potential for there to be a decision in conflict with that earlier decision. However, as noted previously, that earlier finding cannot be decisive of the worker's current claim for payment of Section 32 expenses which involves quite different considerations. Moreover, as Skinner's Case (supra) demonstrates, the earlier finding does not close for all time the issue of incapacity in respect of the disability, and so even if the worker does now pursue a claim for weekly payments since January 1996 he cannot be estopped by the earlier finding.

Mr. Downs did not identify any other finding of fact or decision on a point of law in the earlier proceedings that was necessary to the decision or formed the legal foundation of the decision made and that is now sought to be relitigated.

Mr. Downs cited several authorities in support of his further submission that the worker's present proceedings constitute an abuse of process, they being an attempt to overcome deficiencies in the conduct of the worker's earlier claim. There is nothing in the submission. The earlier proceedings did not involve any claim for Section 32 expenditure. Moreover the scheme of the current Act enables, indeed contemplates, the prosecution of individual claims for different entitlements. This notion is well illustrated by the comments of King C.J. in Iosiv Cristea v. The Corporation (CCA Snack Foods (Smith Food Co.)) (Supreme Court of South Australia) S.4356 at p.4:-

`The claim envisaged by section 52 is a claim for compensation. It is not a claim to have a disability accepted as compensable. A claim for compensation made pursuant to section 52 must be for one or more of the entitlements to compensation conferred by the Act. It is surprising that the prescribed form does not provide for particulars of the pecuniary claim, but the structure of the form cannot influence the interpretation of the Act. ...

The claim which was before the Corporation was therefore a claim to be compensated under one or more of the heads of entitlement provided in the Act.'

King C.J.'s comments were echoed by Doyle C.J. in Mitsubishi Motors Australia Ltd. v. Harboard and Another (Supreme Court of South Australia) 69 S.A.S.R. 75 at p.82:-

`A feature of the scheme of the Act is that each time compensation is claimed, a claim for the purposes of section 52 is required to be submitted. The statutory scheme hinges on this process of making a claim and, subsequently, a decision being reached in respect of the claim. The Act does not provide the making of a decision in relation to the occurrence of a compensable disability other than in the course of determining a claim for compensation.'

Skinner's Case (supra) further illustrates the specific nature of claims under the current scheme.

I dismiss the respondent's application and find that the worker is not estopped from pursuing his current claim.

Parties are advised that if a party wishes to appeal against any part of this decision which is appealable pursuant to Section 86(1) of the Act such appeal must be filed with the Registrar in accordance with Form 11 within 14 days of the delivery of this decision and must be served on all parties.