Plaintiff v Defendant

Supreme Court of Victoria|2007-12-14|Before: FORREST J

ACCIDENT COMPENSATION - Review of decision of Medical Panel - Whether a failure to consider relevant matters - Whether a failure to provide adequate reasons - Relief in the nature of certiorari.

1 Stanoje Zabic ("the worker") was employed by Moyston Court Fisheries Ltd ("the employer") for approximately two weeks in August of 2001.

3 It was alleged by the worker that as a result of his work he contracted a skin condition of his right arm which ultimately resulted in rashes, itching, skin irritation and, by 2007, the development of a number of scars on the arm.

4 Pursuant to the Accident Compensation Act 1985 ("the Act"), the worker sought payments of compensation. When the matter came on in the Magistrates' Court it was, pursuant to s 45(1)(b) of the Act, referred to a Medical Panel for an opinion in respect of the relationship between the worker's asserted injuries and his employment.

5 On 27 January 2007, a Medical Panel ("the panel") constituted under Division 3 of the Act answered a series of questions, in effect affirming that the worker's employment was a significant contributing factor to a variety of the worker's alleged skin conditions of his right arm.

6 The employer now seeks judicial review of the Panel's opinion on the basis that -

(a) The Panel did not take into account a number of "relevant considerations" and therefore fell into jurisdictional error - this ground focused on the alleged failure of the panel to take into account the opinions of the only three dermatologists who had examined the worker and provided reports; and/or

(b) The reasons provided by the Panel were so inadequate as to constitute an error of law - this ground focused on the alleged failure by the panel to deal with the dermatologist's reports, the plaintiff's written submissions and to explain how it reached its diagnosis; and

therefore certiorari should run in respect of the panel's decision.

7 The worker, according to the employer's records, worked for approximately 18 hours on the week ending 30 August 2001, for five hours in the week ending 6 September 2001 and five hours again for the week ending 13 September 2001.[2]

8 On 10 December 2001, the worker completed a claim form pursuant to the Act.[3] It alleged that in the course of his employment with the employer he had suffered "dermatological injury on right arm and left arm". It was said that water and pieces of fish and abalone had got onto his skin as a result of carrying out "moving and washing fish or abalone". The worker described the injury as resulting from exposure to bacteria and substances from fish, abalone and water used to clean them. In the claim form he stated that he received treatment from a Dr Pralastis and that he was receiving regular treatment from a Dr Peter Fergin, a dermatologist.

9 The history provided to a number of doctors confirmed that the worker had seen a doctor at the North Dandenong Medical Centre because of the presence of a rash on his forearms. No report was provided from the general practitioner, so it is difficult to be precise about the dates of attendance.

10 In any event, it is clear that in November 2001 the worker saw Dr Fergin, who practises in Dandenong. Dr Fergin reviewed the worker on several occasions in November 2001; on four occasions in 2002 and on a further two occasions in 2003.

11 It is clear from Dr Fergin's report that when the worker initially presented in November 2001, he had a rash with some red bumps and pustules on his right arm. Thereafter he continued to have intermittent problems with his right arm, particularly with the recurrence of lesions. Dr Fergin treated the worker with topical steroids and antibiotics.

12 Ultimately, the worker developed scarring of the right arm, apparently as a result of the condition which he had experienced in September through to November.

13 In July 2002, he was referred by his solicitors to Dr Rosemary Nixon, a dermatologist in East Melbourne.[4]

14 In June 2003, when seen by Dr Fergin, the worker's forearms and hands were clear apart from the scars, which I infer to have been located on the right arm.

15 The worker completed a claim for compensation apparently on 10 December 2001. However, it was said by the worker to have been lodged on 21 September 2005.

16 In October 2005 the worker was examined by Dr John Brenan, a dermatologist, on behalf of the employer.

17 On 8 June 2006, the worker filed a complaint in the Magistrates' Court seeking "weekly payments not exceeding 104 weeks and medical and like expenses". It was asserted in the claim that -

"Throughout the course of employment and in or about August 2001, the plaintiff suffered injury and disease as a consequence of exposure to bacteria and other substances whilst chilling and handling abalone in the course of employment with the defendant".

18 The particulars of injury were alleged to be: dermatitis, irritation of the skin, itchiness and spots on the right forearm, shock, depression and anxiety, prurigo nodularis, scarring and infection and depigmentation of scars on the right forearm.

19 The claim was rejected and the worker issued proceedings in the Magistrates' Court. On 24 November 2006, the Magistrates' Court, pursuant to s 45(1)(b) of the Act, referred one medical question to the Medical Panel for its opinion.[5]

20 On 27 January 2007, the Medical Panel, constituted by the first, second, third and fourth defendants, provided a Certificate of Opinion. It concluded that the worker's employment was a significant contributing factor to each of the following: dermatitis, irritation in skin, itchiness and spots on right forearm, shock, depression and anxiety, prurigo nodularis, scarring, infection and depigmentation of scars on right arm.[6] At the time of providing its opinion, it also provided its reasons.[7]

21 The worker's entitlement to compensation springs out of s 82(1) of the Act. Once the claim was denied and the conciliation under Division 2 of Part III of the Act failed, then the worker was entitled to bring proceedings in the Magistrates' Court, as he did.

22 Section 45(1)(b) obliges the Court to refer a medical question to a medical panel for an opinion where a party makes such a request. Although s 45 refers to the County Court referring a medical question, s 43 of the Act, and particularly s 43(3), permits the Magistrates' Court to make a similar referral.

23 "Medical question" is defined in s 5.[8] The medical panel is established and its procedures regulated by Division 3 of Part III of the Act. The opinion of the medical panel on a relevant question is binding upon "any Court": s 68(4).

24 The provisions of Part III of the Act were considered in depth by the Court of Appeal in Masters v McCubbery,[9] in which the Court determined that the principles of natural justice applied to the decision of a medical panel.

Was the worker's employment with the employer a significant contributing factor to the following injuries or alleged injuries: (a) dermatitis; (b) irritation in skin; (c) itchiness and spots on right forearm; (d) shock, depression and anxiety; (e) prurigo nodularis; (f) scarring; or (g) infection and depigmentation of scars on right forearm.

26 The referral from the Magistrates' Court was received on 28 November 2006 with accompanying documentation:

(b) The worker's claim form and a certificate of incapacity.

(d) Two medical reports from the treating dermatologist, Dr Fergin; one report from Dr Nixon, a dermatologist, and two reports from Dr Brenan, also a dermatologist.

(e) A document called a s 65(6A) statement.

(f) Submissions on behalf of both the worker and the employer.

27 Dr Fergin saw the worker in November 2001 when the condition was active. He obtained a history from the worker of shelling abalone part-time for about one month. At that time, the worker had developed a rash which, according to Dr Fergin "looked like ulcerated furuncles or boils". A swab confirmed the presence and growth of a common bacteria, staphylococcus aurea.

28 In his report of 26 October 2005,[10] he expressed the following opinion:

"Whilst I am sure he suffered minor trauma to his hands and possibly his forearms while at work, there is no direct evidence that he acquired the bacterial infection at work. This is a very common bacteria and is widespread in the community. There is no evidence that there was any outbreak of boils or furuncles at his place of work. I wasn't satisfied that the condition was work-related. ...

Comments: Stan has had a recurring problem with boils on his forearms due to a bacterial infection. It is a relatively common condition that occurs in the general population and is not necessarily related to work. There was no definite evidence of that the infection was acquired at work. As far as I am aware Stan was fit and well before he started work. I expected a complete recovery from the condition with appropriate antibiotics and antiseptics. Sometimes recurrent boils of the skin occur because of re-infection. The second attack of the condition that Stan had in 2002 developed despite the fact that he hadn't been at work for a length of time - for more than seven months. As one would expect with treatment the boils to resolve completely I wouldn't expect the condition he had to limit his ability for any type of employment in the future. The only residual problem that Stan has is some scarring on the forearms. The only significant contributing factor to the injury may have been minor trauma sustained at work leading to cuts and abrasions that may have become infected." (My emphasis.)

29 In a supplementary report of 21 November 2005,[11] Dr Fergin said as follows:

"I feel that Stan's skin condition probably wasn't related to work because of the following reasons:

(i) Infection was due to an ubiquitous bacteria that can be acquired from many different sources.

(ii) There is no historical evidence that there was any outbreak of boils or similar lesions at work that may have resulted in him acquiring the infection.

(iii) Stan developed the skin infection again some months after leaving work. His skin had been clear of lesions for quite a prolonged period before this.

The only significant contributing factor at work that I can think of is that the job of shelling abalone he may have been prone to minor trauma and cuts of his hands that would be a focus of port of entry for infection. However, Stan did not have lesions on his hands, they were predominantly on the forearms." (My emphasis.)

30 No diagnosis of dermatitis was made by Dr Fergin.

31 As I have noted, in July 2002, the worker's solicitors arranged for the worker to be seen by Dr Nixon, a dermatologist. She took a history from the worker of handling of abalone for about two weeks. She also concluded, like Dr Fergin, that the worker had a history of an infection of the right arm which was successfully treated. She diagnosed the condition as he presented in July 2002 as one of prurigo nodularis. This is a condition caused by scratching of the skin, which perpetuates the lesions. Ultimately, she concluded that the worker had experienced an infection contracted during his employment which had resolved and that he now suffered from prurigo nodularis. She noted that the relationship of the condition to his work was not at all clear-cut.

32 It is to be noted that no diagnosis of dermatitis was made by Dr Nixon.

33 The last doctor to examine the worker and provide a report was the consultant dermatologist, Dr Brenan, who saw the worker in October of 2005.[12] He also had a history of the worker carrying out work with abalone. The worker had a number of scars on his arm but no active skin condition. In his first report of 2 October 2005, he concluded that the condition in 2001 was either a contact dermatitis, possibly due to injury or abalone fluid in contact with the skin, or a marked infection of the skin possibly following a minor injury. He stated that on the balance of probabilities the earlier incident was likely to have been an infected contact dermatitis. He did, however, request that a report be obtained from Dr Fergin to clarify or confirm his opinion.

34 Dr Brenan was subsequently provided with Dr Fergin's report of October 2005 which, as has been observed, made a diagnosis of bacterial infection. After receipt of that report, Dr Brenan provided a further report.[13] The salient parts were as follows:

"In view of Dr Fergin's observations and findings, it would appear that Mr Zabic did not suffer from dermatitis, but had experienced skin infections due to staphylococcus and on settling these lesions left residual scars. Although Mr Zabic stated that on occasion there were possibly cracks in the gloves he wore and sometimes the gloves were not clean, there is no evidence that his employment with Moyston Court Fisheries was a significant contributing factor to the skin infections. ... In summary, in the light of Dr P. Fergin's report, it would appear that Mr Zabic had suffered from recurrent skin infections and not from contact dermatitis or infected eczematoid dermatitis.

The staphylococcus infection which was proven on culture in 2001 and 2002 is a common infection and there is no evidence that this developed as a result of Mr Zabic's short employment with Moyston Court Fisheries. It would therefore be my opinion that Mr Zabic's employment was not a significant contributing factor to his skin infection." (My emphasis.)

35 In summary then, the material provided to the panel from the three dermatologists was to the following effect:

(a) That the worker's condition of the right arm was the result of a bacterial infection.

(b) The worker did not suffer from any form of dermatitis. This was explicit in Brenan's report. I regard it as implicit from the reports of Fergin and Nixon, given that both are specialist dermatologists and that this condition is clearly different to that of bacterial infection.

36 The submissions made to the panel on behalf of the worker did not suggest that the worker suffered from contact dermatitis:

"The defendant[15] submits that he did suffer an infection based on the reports of Dr Nixon and the certificate from Dr Cukier[16] in the course of his employment. ..."

37 The employer's submissions were solely directed to the conclusion that the worker had sustained a common bacterial infection which was not related to his work.

38 The panel arranged for examinations to be carried out by its members. The worker was examined by Professor Paoletti, psychiatrist, on 11 January 2007, Dr Segal, dermatologist, on 17 January 2007, and by Dr Malios, general practitioner, and Mr Leung, plastic surgeon, on 19 January 2007. On 27 January 2007, Dr Malios, on behalf of the panel, provided a certificate of opinion answering each of the questions posed affirmatively. Reasons were provided on the same date.

• The worker worked for about two weeks handling abalone and worked irregularly.

• The worker wore protective clothing, including an apron and gloves which extended to the mid forearm region.

• At the end of the second week of his employment, the worker experienced the onset of itchiness commencing in his right wrist and extending up to his forearm - he also noticed a rash and red lumps.

• The worker was treated by a local general practitioner, who prescribed medication and topical cream and was then referred to a dermatologist.

• The dermatologist treated the worker with medication and a topical application and his condition improved.

• The dermatologist observed ulcerated furuncles and a swab demonstrated infection with staphylococcus aureus bacteria.

• The worker continued to experience itchiness and irritation predominantly of his right forearm and had a flare-up of the red lumps which settled with treatment provided by the dermatologist.

• The worker's right arm is worse in warm weather and he shaves his arm to help control the symptoms.

• The worker had no previous skin conditions or allergies.

• The physical examination revealed multiple circular and depressed scars on the dorsum of the forearm, the larger scars being approximately five millimetres in diameter and one millimetre in depth.

40 The panel then reached the following conclusion:

"Based on the history of the development of symptoms, the contemporaneous medical examination findings and the panel's findings on examination, the panel concluded that the worker's employment with Moyston Fisheries was a significant contributing factor to the development of the alleged injuries described as 'dermatitis; irritation of the skin; itchiness and spots on the right forearm, shock, depression and anxiety; prurigo nodularis; scarring; or infection and depigmentation of scars on right forearm'."

41 It is apposite to make several comments about the reasons of the panel at the present time. First there is no mention of the opinions reached by Drs Fergin, Nixon and Brenan. Secondly, there is no explanation, other than referring to history, contemporaneous medical examination findings and its own examination as to how the panel arrived at a conclusion contrary to that of the three dermatologists.

The first ground of review: Asserted failure by the panel to have regard to relevant considerations

42 In Craig v South Australia,[17] the High Court said that:

"If ... an administrative tribunal falls into an error of law which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on any relevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error, which will invalidate any order or decision of the tribunal which reflects it."

43 In Minister for Aboriginal Affairs v Peko-Wallsend Ltd[18] the High Court set out the matters which must be established in a challenge to the decision of an administrative decision-maker in which it is asserted that the decision-maker has failed to take into account a relevant consideration:

(a) The relevant consideration must be one "which he is bound to take into account in making that decision".

(b) The factors which must be taken into account can only be determined by reference to the relevant statute.

"If the relevant factors - and in this context I use this expression to refer to factors which the decision-maker is bound to consider - are not expressly stated they must be determined by implication from the subject matter, scope and purpose of the Act. ..."

(c) A failure to take into account a particular consideration will not necessarily result in a setting aside of the decision.

"A factor might be so insignificant that the failure to take it into account could not have materially affected the decision. ..."

(d) The Court's role is to review the exercise of the discretion - if it is made appropriately within the discretion it cannot be assailed.

"The limited role of a court reviewing the exercise of an administrative function must constantly be borne in mind".

44 The starting point therefore in such an analysis is the terms of the statute. The Act is silent as to the considerations to be taken into account by a medical panel answering a medical question. What then is to be implied from the subject matter, scope and purpose of the Act?

45 The answer to a medical question is one of considerable significance in the proceeding. As was said by Winneke P in Masters v McCubbery:[19]

"Although these critical issues are referred to the medical panel couched in terms of 'medical questions' and the responses of the panel to them are couched in terms of 'opinions', such legislative terminology cannot obscure the fact that the panel is being called upon to decide matters of mixed law and fact, which decisions operate by virtue of the provisions of the Act to bind the court and thus to effectively dispose of the issues which have been raised by the worker and placed before the court for its determination."

46 The Act provides the panel with a wide range of powers. It can ask a worker to meet with the panel and answer questions, supply copies of documents relating to the medical question, and to submit to a medical examination by the panel or by a member of the panel: s 65(5).[20] Importantly, a person or body referring a medical question to the medical panel must not only identify the injury or alleged injury and the facts relevant to the injury, but also "submit copies of all documents relating to the medical question in the possession of that person or body to the medical panel": s 65(6B).[21] The panel is also given the power to obtain information, with the worker's consent, from a provider of medical services which, one assumes, in most circumstances would be a treating doctor or paramedical practitioner: s 65(6).

47 In my view, the statutory framework established by the Act in respect of medical questions leads to it being impliedly necessary for a medical panel to take into account the following considerations:

(a) Its own examination of the worker (including any history provided and evidence as to any investigations, tests, studies or the like) and its opinion.

(b) The document required under s 65(6A) of the Act identifying the alleged injury and the agreed facts and disputed facts.

(c) The "material" provided by the referring body or person, including the documents relating to the medical question as provided: s 65(6B).

48 Dr Hanscombe, who appeared with Mr Wischusen for the employer, contended that the panel failed to have regard to the medical reports provided by Drs Fergin, Brenan and Nixon which were within the material provided. She argues that there is no reference, in terms, to the opinions of any of these doctors (which is the case). She asserts that Dr Fergin's opinion was so central to the determination by the panel it should have been disclosed in the reasons if it was, in fact, considered.

49 Mr McGarvie SC, who appeared with Mr McKenney for the worker, submitted that it was clear that the panel had taken into account the contents of Dr Fergin's report and that there was no reason to infer that the panel would not have considered the reports of the other two doctors. He pointed to the panel's listing of the documents that it had considered, as well as particular passages in the reasons which had to lead to the inference that Dr Fergin's report had been appropriately considered. If it had been considered he contended then one could infer that so had the reports of Drs Nixon and Brenan.

50 In my view, Mr McGarvie's submissions are to be preferred. I say this for the following reasons.

51 I have no reason to doubt that the panel considered the documents which were described in enclosure A of its reasons; such documents included each of the medical reports and particularly those of Dr Fergin. Indeed, in this case it would be highly surprising that the panel had not read those reports, given that, unlike some other referrals to medical panels, there was only a small amount of documentation provided which was readily digestible by the panel.

52 It is also clear from the reasons of the panel that it must have read Dr Fergin's report. Paragraph 7 of the reasons makes this abundantly clear:

"The panel noted that the worker attended a dermatologist in November 2001. It was noted by the dermatologist that there were ulcerated furuncles on the forearm and a swab was taken which demonstrated infection ... treatment with antibiotics was given." (My emphasis).

53 Whilst it may be that some of the other references to treatment by the dermatologist formed part of the history provided to the panel by the worker, it is abundantly clear that the description provided by the panel at paragraph 7 has as its genesis the report of Dr Fergin. Moreover, in its final paragraph the Panel referred to the "contemporaneous medical findings", which could only be a reference to Dr Fergin's findings as disclosed in his report.

54 I also think that it can readily inferred that if the panel read Dr Fergin's report, there is no reason to think that it did not read the reports of Drs Nixon and Brenan. As was said by Barwick CJ in Kentucky Fried Chicken v Gantidis,[22] the failure to advert to a material circumstance in written reasons is a "very unsure guide" in determining whether in fact there was such a failure.

55 The plaintiff carries the burden of persuading me that there has been such a failure by the panel.[23] I am not satisfied that the panel did not take into account the reports and opinions of Drs Brenan, Fergin and Nixon.

56 I now turn to the remaining question, that of the adequacy of the panel's reasons.

57 Dr Hanscombe contended that the reasons were patently inadequate. She argued that the reasons failed to deal at all with the unanimous opinion, in effect, of the three dermatologists that the plaintiff's condition was not one of dermatitis, but rather was a bacterial infection. In particular, she identified the failure to deal with the treating dermatologist's opinion other than to advert to his examination of the worker. She also contended that the reasons were inadequate in that they failed to provide an explanation as to the diagnosis of irritant dermatitis.

58 Mr McGarvie contended that an analysis of the reasons consistent with what has been said in previous cases in this Court, such as Calleja v Franet Pty Ltd & Ors[24] and Clarke v National Mutual[25] demonstrated that a Court must be particularly cautious when reviewing decisions by bodies such as a medical panel, bearing in mind that they are not comprised of lawyers. He reminded me of the admonitions of the High Court in respect of the examination of such reasons. He contended that the panel adopted a rational approach and its reasons demonstrate that it took into account three factors, namely, the history of the development of the symptoms, contemporaneous medical examination findings and its own findings. He contended that it was not required to do any more.

59 Since the decision in Masters v McCubbery,[26] it is not in issue that a medical panel, by reason of s 8 of the Administrative Law Act, is required to provide reasons for its opinion. What remains as a live issue is the extent of that obligation.

60 Following Masters, there have been a number of decisions of the Trial Division of this Court concerning the adequacy of reasons provided by medical panels. Recently, in Clarke v National Mutual Life Insurance Ltd & Ors,[27] I set out what I thought to be the principles relevant to the provision of reasons. I hope that it is helpful if I set them out again.

• A Medical Panel constituted under the Act is required to provide reasons for reaching its decision.[28]

• Those reasons should enable the Court and the parties to understand that the question referred to the Panel has been properly considered according to law and that the opinion furnished is founded on the appropriate application of the Panel members' medical knowledge and expertise.[29]

• The Panel is an expert tribunal, whose members are chosen for their experience and their findings need to be viewed in that light (cf a non-expert tribunal).[30]

• The reasons provided are those of a Tribunal not that of a judicial body and must be viewed from that perspective. [31]

• The reasons of the Panel are to be read in context, taking into account the background of the case, the material provided and the issues which have to be determined.[32]

• The reasons of an administrative decision maker such as the Panel are meant to inform and over-zealous judicial review is to be eschewed. The reasons should not be over-analyzed.[33]

• Judicial review should not be used to conduct a merits review. [34]

• The reasons of the Panel do not need to advert in detail to those matters it has taken into account.[35]

• The County Court is only bound to act on the Medical Panel's answers to the questions posed by the Court and is not permitted to look to the reasons to explain the opinion.[36]

61 The provision of reasons by a medical panel serves two different purposes.

62 First, it assists a reviewing court in determining whether a court has or has not had regard to relevant circumstances.[37] Although the failure to advert to a matter does not, as has been discussed, lead to a conclusion that a particular matter has not been considered, the reference to a particular matter will enable a court to determine precisely the nature of the considerations entertained by the relevant tribunal. Given my conclusion in respect of the first ground, it is not this aspect of the obligation to provide reasons that this application is now concerned with.

63 Secondly, the reasons of a medical panel should provide an explanation as to why it has reached the decision. It is the extent of that obligation beyond that of demonstrating which matters have been considered and that the Panel has not acted unreasonably which needs to be further considered.

64 In Collector of Customs v Pozzolanic[38] the Full Federal Court considered the adequacy of reasons provided by the Commonwealth Administrative Appeals Tribunal. The following passage from that judgment was cited with approval by the High Court in Minister for Immigration and Ethnic Affairs v Wu Shan Liang & Ors[39]:

"The Court will not be concerned with looseness in the language of the Tribunal, nor with unhappy phrasing of the Tribunal's thoughts. The reasons for the decision under review are not to be construed minutely and finely with an eye keenly attuned to the perception of error."[40]

65 In Wu Shan Liang the High Court itself said as follows:[41]

"These propositions are well settled. They recognise the reality that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed. In the present context, any court reviewing the decision upon refugee status must beware of turning a review of the reasons of the decision-maker upon proper principles into a reconsideration of the merits of the decision."

66 There is, therefore, a clear cautionary warning to exercise restraint in the review of reasons provided by an administrative decision-maker, particularly one that is expert in its own field and likely to have no legal training. Having said that there is the further consideration that such tribunals can determine conclusively the rights of the parties and that the parties have an entitlement to know the basis for the decision.

67 It is convenient now to examine the way in which Courts in the State have treated this issue when the reasons of a medical panel are challenged.

68 In Masters v McCubbery, Winneke P regarded the obligation of the medical panel to be to

"provide a succinct statement of why they came to the conclusions which they did sufficient to enable the parties and the court to see that they have addressed their mind to relevant matters and have not acted unreasonably".[42]

"In the present context, they are medical reasons in sufficient detail, and only in sufficient detail, to show the court and the worker that the question referred to the panel has been properly considered according to law and that the opinion furnished is founded on an appropriate application of the members' medical knowledge and experience. There is nothing in the nature even of the simplest medical question that is incompatible with the furnishing of reasons. For example, one doctor could sensibly ask another the 'reasons' for his or her diagnosis of a patient's illness."[43]

70 In Kamener & Ors v Griffin [No.2][44], Ashley J said:

"... The reasons required of a panel in a particular case will be shaped by the particular issues in dispute and by the material of which the panel is seised. It is thus necessary, on an application for review, to carefully consider the context in which the opinion was reached and the reasons were given."

71 In Pyle v Nisselle & Ors[45], Smith J said, after identifying the test provided by the President in Masters:

"The panel was required to explain why it reached its opinion. If it had rejected the opinions of the experts provided to it on behalf of the applicant, it should have explained why this was so. The rejection of those opinions is the most likely explanation for the decision reached. If, on the other hand, they did not reject these opinions, then the reasons should indicate why they were satisfied that the employment was not and could not possibly be a significant contributing factor in causing the applicant's disabilities. In my view there is a significant gap in the panel's reasons."[46]

72 To similar effect in Kamener & Ors v Griffin (No.1),[47] Williams J held that the medical panel was required to describe in more detail how it reached conclusions relating to a claim in which there was significant conflict between the parties as to the circumstances surrounding the worker's injury: "It was not enough for it to have made a general reference to relevant materials".[48]

73 The Federal Court has, on a number of occasions, dealt with the requirement of a tribunal to explain its reasoning. In Rich Rivers v Radio Australia Broadcasting Tribunal,[49] the Full Federal Court applied the rationale used by Woodward J in Ansett Transport Industries (Operations) Pty Ltd v Wraith[50] in reference to an unsuccessful party's need to understand why a tribunal has decided against it:

"Even though I may not agree with it, I now understand why the decision went against me. I am now in a position to decide whether that decision has involved an unwarranted finding of fact, or an error of law, which is worth challenging."

74 Subsequently, the Full Federal Court in Muralidharan v Minister of Immigration[51] cited with approval the reasoning of Sheppard J in Commonwealth v Pharmacy Guild of Australia:[52]

"The provision of reasons is an important aspect of the tribunal's overall task. Reasons are required to inform the public and parties with an immediate interest in the outcome of the proceedings of the manner in which the tribunal's conclusions were arrived at. A purpose of requiring reasons is to enable the question whether legal error has been made by the tribunal to be more readily perceived than otherwise might be the case. But that is not the only important purpose which the furnishing of reasons has. A prime purpose is the disclosure of the tribunal's reasoning process to the public and the parties. The provision of reasons engenders confidence in the community that the Tribunal has gone about its tasks appropriately and fairly. The statement of bare conclusions without the statement of reasons will always expose the tribunal to the suggestion that it has not given the matter close enough attention or that it has allowed extraneous matters to cloud its consideration. There is yet a further purpose to be served in the giving of reasons. An obligation to give reasons imposed upon the decision-maker an intellectual discipline. The tribunal is required to state publicly what its reasoning process is. This is a sound administrative safeguard tending to ensure that a tribunal such as this properly discharges the important statutory function which it has."

75 The extent to which a medical panel's reasons must go in the context of an accident compensation scheme providing for examinations by a medical panel has also been considered by the Western Australian Court of Appeal in the context of the Worker's Compensation and Rehabilitation Act 1981 of that State. In Re Bannen ex parte Suleski[53], Kennedy J approved of the following statement of principle (with which Wallwork J and Steytler J agreed):

"The essence of reasons for decision is that they disclose the reasoning process of the tribunal. Fulfilment of the obligation to give reasons ensures that a person whose interests may be adversely affected by a decision understands why the decision has been made, and allows a party dissatisfied with a decision to determine whether there has been a reviewable error."

"It is important that the applicant should be able to understand, from the reasons for the decision, why he has had his claim dismissed. He should be told in clear and unambiguous language why he has lost."[54]

76 Subsequently, in Re Croser; ex parte Rutherford & Anor,[55] the Western Australian Court of Appeal, apparently frustrated by the number of medical panel reviews coming before it, set out a series of criteria under the heading "Some advice to Panels".[56] Relevantly, it said as follows:

"(d) The expression of the conclusion, however, is made insufficient by the Act. The Act demands that the panel gives reasons. The law does not demand that the reasons should extend beyond those sufficient to enable the lay reader, and in some cases, the medical reader, to determine how the panel reached its decision.

(e) In those circumstances, one task for the panel is to determine which medical reports it accepts and which it does not. However, it is insufficient to simply make that statement.

(f) In concluding which medical reports to accept or reject, the panel may have regard to matters such as the sufficiency of the history given to the doctor providing each report by the worker; the extent to which, if at all, the doctor has examined the worker and what the doctor has ascertained from that examination; whether the examining doctor has overlooked some matter, which the panel has observed on its examination and which it considers to be relevant; and whether the views expressed by the doctor accord with a respected body of medical opinion. There may be other reasons for rejecting some medical reports. They should be stated."

77 Whilst, respectfully, I doubt whether this "advice" can be applied to all medical panel opinions in this State, it nevertheless underscores the need for a medical panel in this State established under the Act to provide reasons that are more than just a "standard form" medical report. It must, in appropriate cases, demonstrate that it has engaged with the issues that it has to determine. One cannot lose sight of the fact, as Winneke P said in Masters, that the decision may well finalise the rights of the employer and the worker.

78 I therefore accept the principle that the reasons of a medical panel must disclose a discernable path of reasoning leading to the opinion ultimately reached by a panel and provided to the Court. Moreover, in some, not necessarily all, cases it will be necessary for the panel to state why it did not accept a contrary opinion either as to diagnosis or as to the relationship between the injury and the particular work activities. As Ashley J pointed out in Kamener, the reasons will be shaped by the issues. It is appropriate, now, to return to the reasons provided by this panel. I do so bearing in mind the admonitions of the High Court as to the examination of opinions given by a non-lawyer decision-maker.

79 In my view, in this case there was a clear obligation on the panel to explain why it has reached its particular diagnosis. In a case such as this it is necessary for the panel to address, in its reasons, its rejection of an alternative diagnosis. This is particularly so in this case where the medical opinions provided to it pointed solely to that alternative diagnosis. That requirement is enhanced where one of the doctors proffering the diagnosis was the treating doctor responsible for the management and treatment of the worker whilst the condition was active. The panel's explanation does not need to be expansive, but should be enough to enable a reviewing court to understand why a "new" diagnosis has been arrived at.

80 I am reinforced in this view by the use to which a medical opinion is put. As I have said, a medical panel's opinion may well be determinative of the rights of a worker or an employer. In these circumstances it is not unreasonable to expect that a panel will explain why it has reached a certain conclusion and, in certain cases, why it has not accepted a body of medical opinion contrary to its conclusion. On occasions it will have to explain why it has made certain findings of fact. True it is that this will require more than the usual "medical report" formula. So be it. This is so because it is a tribunal resolving significant issues arising between litigants with a statutory obligation to furnish reasons which adequately detail its reasoning.

81 In my view, the reasons of the panel in this case comprise no more than a medical report in a standard well-known (history, examination, investigations and opinion) form. It does not contain the reasons underpinning a decision resolving competing contentions concerning the cause of the worker's disability and its relationship to his employment. None of the medical opinions provided to the panel ultimately suggested that dermatitis was the source of the plaintiff's skin condition. Each attributed the plaintiff's skin condition to a bacterial infection. The panel's only reference to bacterial infection is on the basis that it was some form of aggravation - rather than the underlying cause of the plaintiff's condition. As I have said the panel should have explained, briefly, why it rejected the opinions of three dermatologists. To leave the implied rejection of their opinions unaccounted for was inadequate. This is a case in which the panel should have enlightened the parties, as part of its obligation to provide reasons, with its basis for rejecting the evidence (which was seemingly unanimous in conclusion) which the employer relied upon. Indeed, the fact that the worker did not make a submission that the condition was one of dermatitis reinforces the point.

82 The panel should also have explained its path of reasoning in respect of determining that the condition was one of dermatitis. Whilst the panel took a history, examined the plaintiff and, as I have found, gave consideration to the medical reports provided as part of the referral, it does not explain in terms or implicitly as to how it is that it ultimately concluded that the condition was one of dermatitis. Perhaps it is because abalone contact makes one more likely to suffer from a dermatological condition; perhaps it is because some or part of the findings of Dr Fergin at the initial consultation were consistent with dermatitis; perhaps it is because the course that the condition ran is consistent with dermatitis, rather than bacterial infection; perhaps it is because of the findings on the examination carried out by the panel. All of this is conjecture because the panel did not articulate its path of reasoning. In that respect, it fell into error. Simply referring non-specifically to what it took into account in reaching its conclusion merely highlights the problem and begs the question - namely, how did it reach its conclusion. This was all the more necessary given the contradictory conclusion reached by the three expert dermatologists.

83 In summary, I am satisfied that the reasons are inadequate in that they do not convey to the reader either the basis for the conclusion or deal with the contrary diagnosis which, in the context of this case, should have been the subject of reasons. There is therefore an error of law.

84 In my view, there is no reason not to afford the plaintiff the discretionary relief it seeks; the reasons are plainly defective.[57]

85 Having concluded that the reasons are inadequate, there are, in effect, two courses open to me. I could remit the matter to the panel to provide further reasons pursuant to s 8(4) of the Administrative Law Act. Alternatively, I could refer the questions back to the Convenor of Medical Panels for a determination by a differently constituted panel.

86 In Clarke v National Mutual Life,[58] I stated the principle in terms of determining the appropriate course to be taken:

"Where no reasons are provided then it may be appropriate to refer the matter back to the original panel for delivery of adequate reasons, however where the reasons are partly defective in the sense that 'not all issues have been dealt with', an order compelling delivery of further or better reasons has an 'air of unreality'. Such an order would merely give the tribunal an opportunity to 'patch up' reasons which have been shown to be defective."[59]

87 I think that there would be an "air of unreality" if the matter was remitted back to the panel - with a risk of a "patch up" response. The appropriate course is for the question to be considered afresh by a differently constituted panel.

(a) That the decision of the medical panel made on 27 January 2007 be quashed.

(b) That the question be referred back to the Convenor of Medical Panels for determination by a differently constituted panel.

89 I will determine the question of costs upon application by the parties.

[1] Affidavit of Jonathon Bayly of 17 April 2007 ("Bayly's affidavit")- Exhibit JB2 bundle of documents submitted with referral to medical panels; Exhibit JB4 - the history provided to the Medical Panel.

[5] There was considerable confusion at the hearing as to whether one or two questions had been submitted to the Tribunal. This was resolved by the tendering of the order referring the questions. Only one question was posed.

[8] See the consideration of this issue in Kamener v Griffin (No.2) [2005] VSC 202, (2005) 12 VR 192.

[13] Report dated 22 November 2005, Exhibit JB2 to Bayly's affidavit.

[14] Neither Dr Fergin nor Dr Nixon accepted the condition was work-related. Dr Nixon accepted that the infection occurred during the employment but that the "relationship to his employment was not clear cut".

[15] It was acknowledged by the worker's counsel that this was a typographical error and should have read plaintiff.

[16] The medical certificate did not identify any cause of the condition - what was said to be a rash to the forearms.

[17] [1995] HCA 58; (1995) 184 CLR 163 at 179, see also Minister for Immigration and Cultural Affairs v Yusuf (2001) 206 CLR 323 at [82] and [83].

[20] In the event that the worker unreasonably refuses to comply with the request then he is subject to penalties stipulated under s 67(4).

[21] The Act requires the Court to refer the question to the panel where there is a request by a party: s 45(1). In practice the parties agree as to the material to be supplied to the panel which is then provided to the Court which, in turn, refers the question or questions (which it considers) with a list of the material to be considered - then supplied to the panel by one or other or both of the parties.

[22] [1979] HCA 20; (1979) 140 CLR 675 at pp. 679-680, see also State Trustees Ltd v Transport Accident Commission [2002] VSC 428; (2002) 6 VR 359 at 369-370.

[23] See Portland Properties Pty Ltd v Melbourne & Metropolitan Board of Works (1971) 38 LGRA 6 at 18; XYZ v State Trustees Limited & Anor [2006] VSC 444 at [31].

[28] Masters v McCubbery & Ors supra at 650; Administrative Law Act 1978 s 8(1) and (4).

[29] Masters at p.661 per Callaway JA.

[30] Spurling v Development Underwriting (Vic) Pty Ltd [1973] VicRp 1; [1973] VR 1 at [11].

[31] C/f Hunter v TAC [2005] VSCA 1 at [21] - [22] in which the judicial obligation is spelt out.

[32] George v Nisselle & Ors [2005] VSC 177 at [56], [61] and [62].

[33] Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 271-272.

[35] Kentucky Fried Chicken v Gantidis [1979] HCA 20; (1979) 140 CLR 675, at 679-680.

[36] Lianos v Inner and Eastern Health Care Network [2001] VSCA 53; (2001) 3 VR 136.

[37] Minister for Immigration & Multicultural Affairs v Yusuf (supra) at [69].

[40] Collector of Customs v Pozzolanic, supra, at 287.

[43] Supra at 661, see also Ormiston JA at 652.

[50] [1983] FCA 179; (1983) 48 ALR 500 FCA per Woodward J at 507.

[57] State Electricity Commission v Commissioner for Equal Opportunity & Ors [1992] VicRp 6; [1992] 1 VR 79 at 88.

[59] See Ormiston J in Body Corporate Strata Plan (No.4166) & Ors v Stirling Properties Limited [1984] VicRp 73; [1984] VR 903 at 912.

Compensation Act 1985

Worker's Compensation and Rehabilitation Act 1981

Compensation Act 1985

At a glance

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Judgment (199 paragraphs)

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Legislation Cited (16)

Cases Cited (14)