Supreme Court of SA|1994-06-07|Before: King CJ

MARK ROBBINS v GRAHAM HARBORD AND GENERAL MOTORS-HOLDEN'S AUTOMOTIVE LTD Nos SCGRG 93/1727 and SCGRG 93/1625 Judgment No. 4571 Number of pages - 9 Workers' compensation - proceedings to obtain compensation (1994) 62 SASR 229 [1994] SASC 4571 (7 June 1994)

COURT IN THE FULL COURT OF THE SUPREME COURT OF SOUTH AUSTRALIA KING CJ(1), MOHR(2) AND NYLAND(3) JJ

CWDS Workers' compensation - proceedings to obtain compensation - determination of claims - Adequacy of Statement of Grounds of Rejection of Claim required by s.53(6) Workers Compensation and Rehabilitation Act - Nature of statutory function of Workers Rehabilitation and Compensation Corporation and an exempt employer in determining claims - requirement of s.96(1a) for production to Review Officer of relevant material

Counsel for defendant GMH: Mr S Walsh QC with Mr R Bonig

JUDGE1 KING CJ This is an action for judicial review of certain decisions made by a Review Officer under the Workers Rehabilitation and Compensation Act. The circumstances are set out below.

The plaintiff was an employee of the second defendant which was an exempt employer pursuant to the provisions of Part V of the abovementioned Act. He made a claim for compensation for injury alleged to have occurred in the course of his employment on 23rd November 1992. On 2nd December Dr A C Wilson reported to the second defendant that he had examined the plaintiff on 23rd November 1992. He stated: "There was no evidence of any bruises or abrasion of the shoulder or right side of the body. Clinically he had a cervical strain and I commenced treatment with Feldene, arranged for physiotherapy and issued a workcover certificate for one day."

He reported that there were further certificates until the plaintiff was cleared to resume work on 1st December.

The second defendant gave notice of rejection of the claim pursuant to s.53(5) and (6). The grounds of rejection were stated as follows: "The grounds for rejection are:
1. You did not suffer any injury on the 23rd November 1992;
2. In the alternative, if you did suffer an injury on the 23rd November 1992 (which is denied) you did not suffer any incapacity for work;
3. In the further alternative, if you did suffer an incapacity for work (which is denied) that incapacity did not result from an injury on the 23rd November 1992;
4. If you did suffer an incapacity for work caused by an injury on the 23rd November 1992 (both of which are denied) suitable duties within your capacity have been available to you at all material times."

The plaintiff applied pursuant to s.95 for a review of the decision. The matter came before the first defendant as Review Officer. In answer to questions from the Review Officer the second defendant's representative disclosed that there existed a video film of activities of the plaintiff. At an adjourned hearing on 22nd June 1993, the plaintiff made an application to the Review Officer in the following terms: "(1) That the exempt employer give a proper statement of ground of rejection of the worker's claim pursuant to Section 53(6)(a). (2) That the exempt employer comply with Section 96(1)(a) and disclose to the Review Officer and all other parties to the proceedings the existence of all material in the employer's possession relevant to the proceedings. (3) That the exempt employer be required to produce all such material to the Review Officer.

(4) That the Review Officer provide access to the worker to such material for the purpose of enabling the worker to present his case before the Review Officer."

The Review Officer made the following orders: "1. that the employer give a full and proper statement of the ground upon which it rejected the worker's claim. In doing so, I do not require the employer to provide any further information as to the date or dates upon which the film was taken, or the use made of the film by the employer. 2. That the exempt employer disclose to myself and the worker the existence of all material in the employer's possession relevant to the proceedings. 3. That the exempt employer produce all such material, except for the video film and any other materials subject to the claim of legal privilege, to myself. 4. That the exempt employer provide copies of all such material, other than the video film and any other materials subject to the claim of legal privilege, to the worker."

On 21st July 1993 the solicitors for the second defendant furnished a document in purported compliance with the first of those orders in the following terms: "STATEMENT OF GROUNDS OF REJECTION OF CLAIM Pursuant to the Orders of Review Officer Harbord made on 5 July 1993 the following is a statement of the grounds upon which General Motors-Holden's Automotive limited rejected the worker's claim:
1. On examination of the worker by Dr A C Wilson on 23 November 1992 Dr Wilson noted 'There was no evidence of any bruising or abrasion of the shoulder or right side of the body.'
2. In the absence of objective findings of injury General Motors-Holden's Automotive Limited determined: 2.1 the worker did not suffer a compensable disability on or about 23 November 1992. 2.2 the worker was fit for normal duties during the period of alleged incapacity."

The plaintiff applied to the Review Officer for a summons pursuant to s.90(1)(a) directed to the appropriate officer of the second defendant, Mr D C Weinel, requiring his attendance to be examined on the Statement of Grounds of Rejection. That application was refused.

The plaintiff thereupon instituted these proceedings. The orders sought by the plaintiff in these proceedings are as follows: "1. An order in the nature of certiorari to quash the decision and order of the first defendant given on 5th July 1993 wherein the first defendant ordered that the second defendant, inter alia, to give a full and proper statement of the ground upon which it rejected the plaintiff's claim but with qualifications. 2. An order in the nature of mandamus to the first defendant requiring the first defendant to issue a summons pursuant to Section 90(1)(a) of the Workers Rehabilitation and Compensation Act, 1986 ("the Act")

directed to one D C Weinel to attend to be examined on an alleged Statement of Grounds of Rejection dated 21st July 1993. 3. An order in the nature of prohibition directed to the first defendant ordering that he cease and desist from the further hearing of the plaintiff's application for review until such time as the within summons and a summons seeking a determination as to the proper interpretation of certain sections of the Act being proceedings No 1625 of 1993 in this Honourable Court are heard and determined. 4. Declarations as follows: (a) That the second defendant is obliged by the provisions of Section 53(6)(a) of the Act to disclose to the plaintiff all the material upon which it relied when providing its statement of the ground of rejection of the claim; (b) That the second defendant is obliged by the provisions of Section 53(6)(a) of the Act to disclose to the plaintiff a reliance upon video film and/or an investigator's report adverse to the plaintiff's claim if any such reliance existed when providing its statement of the ground of rejection of the claim; (c) That the second defendant is obliged by Section 96(1a) of the Act to: (i) disclose to the Review Officer the existence of video film and/or an investigator's report adverse to the plaintiff's claim whether or not such material may have come into the second defendant's possession in circumstances which would give rise to a claim for legal professional privilege; (ii) produce to the Review Officer and the plaintiff video film and/or an investigator's report adverse to the plaintiff's claim whether or not such material may have come into the second defendant's possession in circumstances which would give rise to a claim for legal professional privilege. (d) That by relying upon material which might otherwise be the subject of legal professional privilege in making a determination pursuant to Section 53 of the Act, the second defendant necessarily waived any legal professional privilege attaching to the relevant material."

The first issue relates to the grounds of rejection. Section 53(6) of the Act, so far as material, is as follows: "Where any part of a claim is rejected the notice referred to in subsection (5) must include (a) such information as the regulations may require as to the grounds on which the claim is rejected ..."

Important, although not necessarily the only, purposes of this statutory requirement must be to enable the worker to make an informed decision as to whether to seek review and, if he decides to do so, to enable him to prepare his case adequately. The grounds must therefore be expressed with sufficient particularity to fulfil those purposes. In Arrowcrest v Watson (Print A 79/1992), the Workers Compensation Appeal Tribunal said: "It is a fundamental misconception of the task, to give grounds for a decision in the alternative, and to employ such verbiage as 'which is denied'. While the decision can cite various grounds for a particular result, those will be cumulative, as distinct from alternative ....... It is not enough to merely recite parts of the Act, for instance s.30. The intent is the worker should have a sufficient understanding of why his claim was rejected."

I do not think that I can agree that grounds of rejection may never be expressed in the alternative. I should think that there would be cases in which that would be necessary. I do agree however that the grounds must give the worker an understanding of why his claim was rejected which is sufficient at least to fulfil the abovementioned purposes. Merely formal grounds expressed in terms of the statute are not sufficient. The statement must indicate distinctly, specifically and with reasonable particularity, the grounds on which the claim is rejected.

The original Statement of Grounds were plainly insufficient. They were formal in character, largely following the language of the statute. They did not convey to the worker the real reasons for rejection of his claim. The Review Officer was clearly right to order the delivery of proper grounds. The grounds contained in the Statement dated 21st July 1993 do not lack specificity. They base the rejection upon Dr Wilson's report that there was no evidence of bruising and abrasion and the absence of objective findings of injury. The complaint which the plaintiff makes in relation to that Statement of Grounds is not that it lacks specificity, but that it lacks bona fides. The argument is that Dr Wilson's report could not of itself justify rejection of the claim; indeed it acknowledges both injury and incapacity. The plaintiff suspects that the real reason for rejection is the content of the video film which is not mentioned as a ground of rejection. The remedy sought is the examination of the appropriate officer of the defendant to ascertain the true grounds of rejection.

A review by a Review Officer is not confined to the issues raised by the Statement of Grounds of rejection. The Review Officer is required to "make a fresh determination of the matters to which the decision subject to review relates"; s.96(2). The implications of that provision were considered in Santos Ltd v Saunders (1988) 49 SASR 556. At p.559 I said: "The mandate 'to make a fresh determination' imports, in my opinion, a review de novo in which the review officer must review all material which was before the Corporation, receive such additional evidentiary material as he thinks proper and make a fresh judgment on the matter."

Von Doussa J said at p.568: "Section 96(2) requires that the review officer shall make 'a fresh determination of the matters to which the decision subject to review relates' and s 88 requires that in doing so he 'shall act according to equity, good conscience and the substantial merits of the case'. The review officer is required to consider the matter de novo and to arrive at a decision independently of the process of reasoning and the decision of the Corporation. It is proper that he note the decision and the reasons of the Corporation for, after all, he is reviewing that decision. After considering the views of the Corporation, he must form his own opinion, and in doing so, in not bound by the views of the Corporation."

That being the function of the Review Officer his review cannot be confined to the stated grounds of rejection. Nevertheless the review must be conducted fairly and in accordance with the dictates of natural justice. If possible grounds of rejection, other than those stated, emerge on the review, the worker must be given a fair opportunity to meet those grounds. The Corporation or an exempt employer should not be permitted to rely on spurious grounds of appeal in order to force the worker to face cross-examination in the speculative hope that some other grounds of rejection will emerge. If on perusing the material provided to him under s.96(1a) the Review Officer perceives the possibility of some ground of rejection other than those stated, he should inform the worker of that possible ground at the earliest practicable stage of the Review.

The defendant admittedly has a video film. If the true ground of rejection, or one ground of rejection, is that the worker has engaged in activities which are inconsistent with the alleged incapacity, that should be stated as a ground of rejection. I am unable to find any warrant in the Act, however, for holding that the Review Officer is obligated, or even empowered, to order the attendance of an officer of the defendant to be examined in advance of the review as to whether there are any grounds of rejection other than those stated. The order sought in paragraph 2 of the Summons must therefore be refused.

A ground of rejection is not the same as the evidence supporting the ground of rejection. The obligation is to state grounds not evidence. The film is evidence not a ground. The qualification on the order made on 22nd June 1993 for a full and proper statement of the grounds, namely that the employer was not required "to provide any further information as to the date or dates upon which the film was taken, or the use made of the film by the employer" was correct. The qualification did not excuse the employer from stating as a ground, if it is a ground, that the worker has engaged in activities. The order sought in paragraph 1 of the Summons must therefore also be refused.

The order sought in paragraph 3 of the Summons is no longer necessary.

A number of declarations are sought in paragraph 4 of the Summons.

As to the declaration sought in paragraph 4(a), it is sufficient to state that s.56(6)(a) places no such obligation on the second defendant. The obligation is to furnish a statement of the ground of rejection not the material which is relied upon. I repeat the distinction between a ground of rejection and the evidence or material supporting that ground. Likewise there is nothing in s.53(6)(a) which imposes an obligation of the kind referred to in paragraph 4(a). The declarations sought in paragraphs 4(a) and (b) must therefore be refused.

The declarations sought in paragraph 4(c) raise the question whether material which would otherwise be subject to the obligation to produce under s.96(1a), may be protected from production by legal professional privilege. Legal professional privilege at common law attaches to documents which are brought into existence for the sole purpose of submission to legal advisers for advice or for use in legal proceedings; Grant v Downs [1976] HCA 63; (1976) 135 CLR 674; Baker v Campbell [1983] HCA 39; (1983) 153 CLR 52. I assume for the purpose of this case that a video film can be the subject of legal professional privilege; see Lanzon v STA (1985) 38 SASR 321 at 322. The existence of a video film was disclosed to the Review Officer and the plaintiff as required by s.96(1a). The defendant declined to produce the film to the Review Officer on the ground of legal professional privilege. Its counsel asserted before the Review Officer "that the film was brought into existence for the sole purpose of legal proceedings". Although there was no explicit admission to this effect, it is reasonable to assume that the film depicts activities of the plaintiff and is therefore relevant to the proceedings before the Review Officer.

In order to determine the claim of legal professional privilege, it is necessary to examine the function under the Act of the defendant as an exempt employer. The general scheme of the Act is that employers are relieved of legal liability, apart from the initial incapacity of up to one week, for injuries sustained by their employees in the course of the employment. They are required to pay a levy to a fund administered by the Workers Rehabilitation and Compensation Corporation. The Corporation is a statutory body established to administer the Act and the scheme of compensation thereby established. Where injury occurs to a worker in compensable circumstances the Corporation is liable to pay compensation. The Corporation on receipt of a claim is required to "make such investigations and inquiries as it thinks necessary to determine the claim." (s.53 (1)). The Corporation is empowered to require information and a medical examination (s.53(2)) and is required to determined the claim "as expeditiously as reasonably practicable" (subs.(4)). The Corporation is required to give notice of the determination of the claim (subs.(5)) and, in case of rejection, a statement of the grounds of rejection (subs.(6)).

An employer may be exempted from the scheme pursuant to s.60. If it is so exempted, it becomes liable to pay compensation to which a worker is entitled under the Act. With certain exceptions, the powers and discretions of the Corporation are delegated to an exempt employer (s.63(1)). An exempt employer is therefore required to determine a claim for compensation by its employees in the same manner as the Corporation is required to determine claims by other employees. Section 63(4) provides that "a decision of an exempt employer made in pursuance of a power or discretion delegated under subsection (1) shall have the same force and effect as a decision of the Corporation and shall be subject to review and appeal in the same way as a decision of the Corporation."

The provisions for reviews and appeals are contained in Part VI Division VI. The Corporation or the exempt employer, as the case may be, is necessarily a party to a review or appeal. A consideration of the provisions to which I have referred above, however, makes clear that they are not ordinary parties to litigation. The decision by the Corporation or exempt employer in relation to a claim is not simply a decision by a private person or Corporation against whom a claim is made whether or not to admit or deny liability. It is a decision made in pursuance of a statutory function. The function of the exempt employer is not distinguished from that of the Corporation. Both have the statutory function of investigating and determining claims for compensation. Neither is entitled in determining claims simply to consult its own interests. There must be proper grounds of rejection of a claim and they must be notified to the claimant. It follows, in my opinion, that the Corporation or exempt employer are not parties to a review or appeal in the ordinary role of litigant but as primary decision makers defending their primary decision against a person affected by the decision (s.95).

The date or dates of the filming are unknown. There can be no doubt, however, that its purpose was either to provide material to assist in the defendant's function of making the primary decision on the plaintiff's claim, or to provide material to support that decision before the Review Officer. Its purpose was not use by a litigant in the course of litigation, but use by a statutory decision maker in discharging its statutory function. I do not think that that purpose attracts legal professional privilege.

This conclusion is reinforced by the provisions of s.96(1a) which are as follows: "A party to proceedings before a Review Officer must disclose to the Review Officer and all other parties to the proceedings the existence of all material in the party's possession or power that may be relevant to the proceedings and must, if the Review Officer so requests, produce all or any of that material to the Review Officer."

This subsection envisages that all relevant material in the possession of the Corporation or the exempt employer will be disclosed and, if requested, produced, to the Review Officer. Most, if not all, of that material would in the typical case be protected by privilege if the Corporation or exempt employer were an ordinary litigant. It cannot be intended that they could withhold statements of witnesses and other material gathered in the course of an investigation leading to determination of a claim. Such an interpretation would largely defeat the purpose of the subsection. It is implicit in the subsection that legal professional privilege is not to apply to material relevant to the proceedings.

I am of opinion therefore that legal professional privilege does not apply to the video film or investigator's report and that they must be produced to the Review Officer, if requested.

The plaintiff's claim in paragraph 4(c)(ii) of the Summons is for a declaration that the film and report be produced to the plaintiff as well as the Review Officer. That declaration is not warranted by s.96(1a). The subsection requires relevant material to be disclosed to the Review Officer and the plaintiff. The obligation to produce, however, is to the Review Officer only. It is then for the Review Officer to decide whether the material should be disclosed to the plaintiff and if so the stage of the proceedings at which such disclosure should be made. If the material is relevant it will presumably be used on the Review and must as a matter of procedural fairness be disclosed to the plaintiff. The stage at which this should be done may be more difficult to determine. A direction for premature disclosure to the plaintiff might have the effect of depriving the defendant of natural justice; Australian Postal Commission v Hayes and Anor [1989] FCA 176; (1989) 87 ALR 283. I should think that there would be every justification in a case such as the present for withholding a film of the plaintiff's activities from the plaintiff until he has been cross-examined about his physical capacity and activities.

The decision of the Review Officer to refuse to require the production to him of the film on the ground of legal professional privilege, is vitiated, in my opinion my an error of law as to the applicability of legal professional privilege and is therefore amenable to judicial review. The remedies sought are by way of declaration.

I would make the following declaration: That the second defendant is obliged by s.96(1a) of the Workers Rehabilitation and Compensation Act (a) to disclose to the Review Officer and the plaintiff the existence of any film and investigator's report which is relevant to the proceedings and (b) to produce to the Review Officer any such film and investigator's report.

If that declaration is made the declaration sought in paragraph 4(d) will not be required.

MARK ROBBINS v GRAHAM HARBORD AND GENERAL MOTORS-HOLDEN'S AUTOMOTIVE LTD Nos SCGRG 93/1727 and SCGRG 93/1625 Judgment No. 4571 Number of pages - 9 Workers' compensation - proceedings to obtain compensation

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Judgment (39 paragraphs)

MARK ROBBINS v GRAHAM HARBORD AND GENERAL MOTORS-HOLDEN'S AUTOMOTIVE LTD Nos SCGRG 93/1727 and SCGRG 93/1625 Judgment No. 4571 Number of pages - 9 Workers' compensation - proceedings to obtain compensation (1994) 62 SASR 229 [1994] SASC 4571 (7 June 1994)

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Cases Cited (6)