KB Hutcherson Pty Ltd v Correia

(c) Remit the question of the amounts of compensation properly payable under the Table of Compensation for Permanent Injuries for permanent loss of the efficient use of each leg or above the knee to the Compensation Court of New South Wales for reconsideration.

The Court delivered the following written judgment: -

16 March 1995 Brennan, Deane, Dawson, Toohey and McHugh JJ

This appeal raises a question of construction of the Workers Compensation Act 1987 NSW (the Act) as it stood at the relevant time.

On 23 November 1988 the respondent suffered an injury to his back in the course of his employment by the appellant. In the Compensation Court of New South Wales Judge Manser ordered the appellant to make payments of weekly compensation to the respondent and also payment in respect of permanent impairment of his back. These matters are not in issue before this Court.

What is in issue are orders made by Judge Manser, and affirmed by the Court of Appeal, under the Table of Compensation for Permanent Injuries in the Act. The Table is part of Div 4 of Pt 3 of the Act; the division is headed: Compensation for non-economic loss. Entitlement to compensation under the Table derives from s 66 which reads:

(1) A worker who has suffered the loss of a thing mentioned in the Table to this Division as the result of an injury is entitled to receive from the worker's employer by way of compensation for the loss, in addition to any other compensation under this Act, the amount equal to the percentage of $80,000 set out opposite to that loss in that Table.

(2) A worker who has suffered more than one of the losses mentioned in the Table to this Division as a result of the same injury is not entitled to receive as compensation under this section more than $80,000 in respect of those losses.

(3) Where by the operation of Division 6 the amount of $80,000 is adjusted, the compensation payable under this section shall be calculated by reference to the requisite percentage of the amount in force at the date of injury.

The amount of $80,000 is subject to adjustment; at the relevant time it was $85,200.

Leg injuries - Loss of either leg at or above the knee 75 Loss of either leg below the knee 70.

Section 65 of the Act defines "loss", in relation to a thing, to mean the loss of that thing or the permanent loss of the use, or of the efficient use, of that thing.

There was evidence in the Compensation Court that, as a result of the impairment of his back, the respondent had suffered a partial loss of the efficient use of his lower limbs. Dr Wolfenden, a consultant neurologist, gave evidence. In his report of 14 February 1991 he expressed an opinion in the following terms:

I note your requests for an expression of percentage loss in assessment of his disability. It must be understood that there is no primary disability in the legs and the apparent difficulty in the legs is due entirely to compression of the nerve roots in the back which cause pain in the legs. The primary disability therefore relates to his lumbar spine where there is not only pain but also gross limitation of movement, I can only assess the overall disability of the whole person from this cause as being between 40 and 50%. However, in answer to specific questions from the respondent's solicitors, Dr Wolfenden wrote as follows on 28 March 1991:

Permanent impairment of back expressed in percentage terms - 40%.

Loss of efficient use of right leg below the knee in percentage terms - 30%.

Loss of efficient use of left leg below the knee in percentage terms - 20%.

Loss of efficient use of right leg at or above the knee in percentage terms - 30%.

Loss of efficient use of left leg at or above the knee in percentage terms - 20%.

There was also tendered in evidence a report dated 18 February 1991 from an orthopaedic surgeon, Dr Graham, to the effect that the respondent had lost 30 per cent of use of the right lower limb, 15 per cent of the left lower limb and 35-40 per cent of his back function. Dr Graham added:"I am not really able to distinguish between the percentage loss of use of the right leg below the knee and above the knee."

Judge Manser held that the respondent had lost 30 per cent of the efficient use of his right leg below the knee, 30 per cent of its efficient use at or above the knee, 20 per cent of the efficient use of his left leg below the knee and 20 per cent of its efficient use at or above the knee. It is clear that, in doing so, he accepted Dr Wolfenden's assessment of 28 March 1991.

The question before this Court is whether the respondent was entitled to compensation under the Table for loss of efficient use of each leg, both at or above the knee and below the knee, or whether he was entitled to compensation only for such loss at or above the knee. The Court of Appeal upheld Judge Manser's award of compensation under the Table. In our respectful view it erred in doing so.

The appellant does not challenge the factual findings made by Judge Manser in respect of the assessment of loss, whether at or above or below the knee. But it contends that nothing in the Act authorises the making of an award which compensates a worker for loss of efficient use of a leg, both at or above the knee and below the knee.

In his written submissions the respondent appeared to accept that an award in such terms could not be made in the case of loss of a leg through amputation, acknowledging that compensation "may well be limited to 75% of the amount fixed by sub-section 66(2) of the Act". However, in argument, senior counsel for the respondent maintained that the "ultimate position" for which he contended would require compensation in such a case, both at or above the knee and below the knee. Even if that be not so, counsel contended that in the case of loss of use or loss of efficient use a different approach was available. There is no justification for such a distinction. Priestley JA who delivered the principal judgment, with which Meagher JA and Cripps JA agreed, acknowledged that the distinction may lead to anomalies but said that "two of the worker's four losses fall literally and substantially in to the description "loss of either [leg] at or above the knee" and the other two literally and substantially into the description "loss of either leg below the knee" ". That the distinction does lead to anomalies is evident when regard is paid to the percentages prescribed by the Table for particular losses in the case of arm injuries, hand injuries and foot injuries, and this notwithstanding Note (c) of the Table to which reference is made later in this judgment.

Although Priestley JA did not refer to any authority in support of the approach taken, there is authority in the Court of Appeal, particularly in J Odlin Shopfitting International Pty Ltd v Kaljanac [1] . In Kaljanac , the Court of Appeal upheld an award of the Compensation Court compensating a worker under the Table for permanent loss of the efficient use of the right arm, both at or above the elbow and below the elbow. The principal judgment was delivered by Kirby P, with whom Meagher JA and Cripps JA agreed. Kirby P mentioned earlier decisions, in particular Bennett v General Motors Holdens Ltd [2] which was referred to with approval in King v Hayward [3] . But those were instances of successive injuries, in the first case to an arm and in the second case to an eye. The principle in those situations is clear enough but it has no application in the present case.

1. (1993) 29 NSWLR 632. 2. (1940) 40 SR (NSW) 117. 3. (1943) 67 CLR 488 at 494.

In his judgment Kirby P offered six reasons for giving the Table its literal construction. The first was the course of legislative history which, his Honour said, showed a move towards "greater specificity in the identification of the body parts which will attract compensation" [4] . But the inference to be drawn from that history is no more than that the legislature has sought in the Table to identify loss of the relevant part of a limb with more precision than loss of a limb "or of the greater part thereof".

The second reason was that there was no justification for construing the items in the Table "consecutively and as alternatives" and that, on the contrary, the structure of the Table, within the Act, "indicates a recognition that multiple injuries will be suffered giving rise to multiple claims" [5] . It is true that multiple injuries will give rise to multiple claims under the Table. Section 66(1) provides that a worker "who has suffered the loss of a thing mentioned in the Table" is entitled to receive the amount equal to this percentage of the nominated amount set out opposite to that loss in the Table. Section 66(2) then provides that a person who has suffered more than one of the losses mentioned in the Table as a result of the same injury may not receive more than the nominated amount in respect of those losses. Section 66 does not create some sort of charter for compensation. It establishes an entitlement but puts a ceiling on that entitlement [6] . It is still necessary to go to the Table to identify the relevant loss.

1. Kaljanac (1993) 29 NSWLR 632 at 638-639. 2. See Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318 at 323-324.

The third reason offered by his Honour is in negative terms, namely, that Note (c) of the Table "cannot remove the differentiated provision in respect of arm injuries contained in the Table itself for the note only exists to assist in the construction of the Table" [7] . Note (c) provides that if a loss "may be compensated by a combination of items in the Table or by a proportionate loss of a single item, the loss shall be compensated by a proportionate loss of a single item". Note (c) does not advance the position one way or another; in terms of the Note, the question remains whether the loss calls for compensation by a combination of items in the Table.

The fourth reason is in effect that any anomalies resulting from the approach taken by the Court of Appeal can be accommodated within the Act, particularly having regard to s 66(2). But that provision throws no light on the proper construction of the Table so far as this appeal is concerned. Certainly, on the approach urged by the respondent there is an anomaly in that a worker whose leg is amputated at or above the knee may receive less than a worker who has suffered permanent loss of efficient use of the limb.

The fifth reason is that, had the construction urged by the appellant been the purpose of Parliament, one might have expected a note similar to Note (c), "but specific to the differentiating item of arm injuries" [8] , would have been included. But if the position is otherwise clear, no such note is necessary.

The sixth and final reason is that in most cases the loss suffered by the worker will be a proportionate loss of the efficient use of the limb and a medical panel may, without difficulty, differentiate any claims "at or above" or "below" the limb. But, with respect, that tends to beg the question. The differentiation is called for in order to determine the appropriate item. Once that is done, the task is to assess the percentage loss of that item.

In the end the question is a fairly straightforward one. The Table provides under the heading "Leg injuries" for loss of either leg at or above the knee and loss of either leg below the knee. The points mentioned in the Table ("leg at or above the knee" and "leg below the knee") identify, in relation to loss of use, the same maximum level of compensation as the loss by amputation at those points and require the same factors to be considered in the assessment of compensation, namely, the extent to which the entire limb below the uppermost point of affection is lost or its use is lost. No doubt, medical opinions may differ as to the degree of loss in any case where the use of a limb has been affected. But nothing in the Table or in the Act itself warrants making two assessments in the case of one leg.

It follows that the appeal should be allowed and the matter remitted to the Compensation Court to determine the amounts of compensation properly payable under the Table for permanent loss of the efficient use of each leg at or above the knee.

Special leave to appeal was granted in this case on the basis that it was a test case. The respondent indicated, on the application for special leave, that he would be applying for an order that the appellant pay his costs of the appeal in any event. The respondent made such an application on the hearing and the appellant indicated that there was nothing which it wished to put in opposition to it. In these circumstances, the appropriate course is to leave undisturbed the order for costs in the courts below and to order that the appellant pay the respondent's costs of the appeal.