The Registrar's reasons for determination dated 9 March 2012
68The Registrar set out the correct test to be applied pursuant to s 327. In her reasons for determination, the Registrar at [8] to [11] stated:
"8 An AMS, unlike an arbitrator, is not a member of the Commission, and the issuing of a MAC is not a proceedings before the Commission (Jopa Pty Ltd t/as Tricia's Clip-n-Snip v Edenden [2004] NSWWCCPD 50 at [26] and, amongst many decisions, Ponticello (as executrix of the estate of the late Giorgio Gino Ponticello) v De Martin & Gasparini Pty Ltd and anor [2010] NSWWCCPD 46 at [42] - [44], [47] and [53] and Fleming v New South Wales Police Force [2011] NSWWCCPD 33 at [95]). The MAC is conclusively presumed to be correct, but it is not an order of the Commission and lacks 'finality' to ground estoppels (Superior Formwork Pty Ltd v Livaja [2009] NSWWCCPD 158 at [95], [98], [99] & [107]).
9 A determination of the Commission has the requisite 'finality' to support cause of action and issue estoppels between the parties and their privies. However, whilst the determination of the Commission creates an estoppel in respect of the degree of permanent impairment or permanent loss of use as at the date of that determination, the relevant circumstance in this case is an assessment of the degree of permanent impairment at a time later than the date of that determination of the Commission.
10 For the appropriate way to assess a claim for a 'further' permanent impairment at a later time for injury received on or after 1 January 2002 or permanent loss of use for an injury received prior to 1 January 2002, regard must be had to the decision in Rail Services Australia v Dimovski & Anor (2004) 1 DDCR 648, especially at 652-653; and also Rinker Group Limited v Mackell [2008] NSWWCCPD 100 at [122] - [125], Prist v Department of Ageing, Disability and Home Care (No 2) [2009] NSWWCCPD 13 at [55] - [60] and Abou-Haidar v Consolidated Wire Pty Ltd [2010] NSWWCCPD 128 at [65] - [66], The latter as an adjunct to a discussion of the nature of a further claim for lump sum compensation and the (absence of) relevance of proving "deterioration" for there to arise a need to refer to an AMS. In short, the authorities establish that there is no issue estoppel running from a determination of the Commission as at a particular date to an assessment at a later time in circumstances capable of change.
11 There is no issue estoppel in circumstances capable of change, and the degree of permanent impairment or loss of use that results from an injury is certainly a circumstance capable of change. The role of the AMS at a later time is to give an opinion as to the degree of permanent impairment as a result of the injury as the worker now presents, without a legal constraint from a prior award that would require the AMS to ground her assessment on first establishing improvement or deterioration from what has been determined by the Commission at an earlier time. A higher later figure may lead one to say that there has been a deterioration since a certain date, or a lower figure an improvement. Nonetheless, this shorthand way of putting it does not describe the role of the AMS in law. Any presumption of continuance falls away because the later certificate of the AMS is conclusively presumed to be correct in that regard. Adjustments for past payments in respect of an injury, when there is further permanent impairment or loss of use is a matter for the parties to determine, or the Commission if disputed."
69Railcorp submitted that the refusal of the Registrar to allow the appeal to proceed to a Medical Appeal Panel on the basis that the Approved Medical Specialist failed to make reference to the previous determination of the Workers Compensation Commission erred in law. This was contended on three bases; firstly, the Registrar failed to heed the decision of the Workers Compensation Commission in Superior Formwork Pty Ltd v Livaja [2009] NSWWCCPD 158 at [95] which deals with the situation of a determination by the Workers Compensation Commission as opposed to a MAC finding; secondly, the Registrar erroneously relied upon the decision of the Workers Compensation Commission in Abou-Haidar v Consolidated Wire Pty Ltd [2010] NSWWCCPD 128, a case that was inconsistent with the decision in Superior Formwork Pty Ltd v Livaja; and thirdly, the decision of the Workers Compensation Commission in Abou-Haidar v Consolidated Wire Pty Ltd is wrong in law and should not have been followed by the Registrar.
70Railcorp contended that, once a claim for lump sum compensation has been determined in a particular claim, there cannot be any subsequent lump sum claims or referrals to an Approved Medical Specialist unless there is evidence of a change or deterioration in the worker's condition.
71Mrs Haroun referred to ss 350(1) and (2) of the Act and submitted that once the Commission makes a decision on a dispute and a certificate of determination has been issued under s 294, except as otherwise provided in the Act, it is 'final and binding on the parties and is not subject to appeal or review' and is not open to challenge.
72Mrs Haroun has a claim for further or additional lump sum compensation, which she supported with medical reports assessing a WPI assessment that is higher than in a previous award or order. Such a claim, she submitted, where there is no dispute as to injury, is a medical dispute within s 319 of the Act. A worker does not have to establish a prima facie case of a deterioration before such a claim can be referred to an Approved Medical Specialist for assessment.
73Mrs Haroun accepts that if the Commission had determined that the effect of an injury had ceased, then there would be no medical dispute to be referred to an Approved Medical Specialist. In those circumstances, for the purposes of a lump sum compensation claim, the worker would be estopped from arguing to the contrary. Senior counsel for Mrs Haroun submitted, it is a well established principle that there is no issue estoppel in situations capable of change. A later claim for lump sum compensation is one example of such a change. According to Mrs Haroun, the relevant authorities reject Railcorp's contention that, once a claim for lump sum compensation has been determined, there cannot be further lump sum claims made or referred to an Approved Medical Specialist, unless there is evidence of a change or deterioration in the worker's condition.
74Mrs Haroun's position is that the law as expounded in Abou-Hadair v Consolidated Wire Pty Ltd is correctly stated, and is on point here and that the reasoning in Abou-Hadair v Consolidated Wire Pty Ltd is not to the contrary of, or inconsistent with, that in Superior Formwork Pty Ltd v Livaja. In any event, counsel for Mrs Haroun says that Superior Formwork Pty Ltd v Livaja is readily distinguishable on the facts of the present case. This is because the Commission has never determined that the effect of Mrs Haroun's injury had ceased.
75It is necessary to refer to both Abou-Hadair v Consolidated Wire Pty Ltd and Superior Formwork Pty Ltd v Livaja.
76In Abou-Haidar v Consolidated Wire Pty Limited at [55]-[58], [60] and [65] - [66] the Presidential Member stated:
"55 I do not accept Mr Flett's submission that the position is different in a claim for additional lump sum compensation compared to an initial claim for such compensation. Nothing in the legislation provides any direct or implied support for that submission. It is not necessary for the Commission to determine, as a threshold issue, whether the worker has demonstrated that his or her condition has deteriorated before the matter is referred to an AMS for a further assessment. A worker must make a claim under s 282 and support that claim with a whole person impairment assessment in the proper form from a WorkCover trained assessor. If the assessment is the same as in a previous award or order of the Commission, there will be no basis for referral to an AMS. If the assessment is higher than in a previous award or order, then, assuming that there are no liability issues in dispute, the Registrar will refer the matter to an AMS for further assessment.
56 The orders made on 4 January 2007 awarded compensation for $7,500 in respect of six per cent whole person impairment. The Commission made that order based on Dr O'Neill's MAC issued on 6 December 2006 that assessed six per cent whole person impairment as a result of injury to the worker's neck and nil whole person impairment as a result of the injury to the thoracic spine. As neither party appealed the MAC and the Commission made orders based on it on 4 January 2007, it follows that the finding of nil per cent impairment for the thoracic spine is conclusively presumed to be correct and formed the basis for the orders made on 4 January 2007.
57 Section 105 does not assist the employer. It gives the Commission jurisdiction, "subject to" the 1998 Act, to 'examine, hear and determine all matters arising under' the 1998 Act and the 1987 Act. The Commission has jurisdiction to determine liability issues. However, once those issues are determined, the Commission has no jurisdiction to determine medical disputes that come within the terms of s 319. A claim for further or additional lump sum compensation as a result of an alleged increased impairment since a previous assessment or award, where there is no dispute as to injury, is such a medical dispute. A worker does not have to establish a prima facie case of a deterioration before such a claim can be referred to an AMS for assessment and, to the extent that suggests the contrary, it is not consistent with the legislation.
58 I do not accept that this result will mean that there will be no limit to the number of applications for additional lump sum compensation a worker can bring. The right to have a claim referred to an AMS is restricted to claims that comply with the claims procedure in the legislation and the WorkCover Guidelines. Those claims will have to be supported by assessments provided by WorkCover trained assessors. Workers who bring claims that are frivolous or vexatious, fraudulent or without proper justification will be liable to an adverse costs order (s 341). The Commission will determine costs applications on a case-by-case basis. However, if, in a subsequent claim, a worker relies on essentially the same evidence used to support the initial claim, and if that evidence does not suggest a change in the level of whole person impairment since a previous assessment, and if the AMS reaches the same conclusion he or she reached in the initial MAC, the employer may have an argument that the claim was frivolous or vexatious, or brought without proper justification.
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60 The insurer has not disputed whether Mr Abou-Haidar made a proper claim for lump sum compensation on 5 February 2010. It raised no liability issue, but merely disputed whether there had been a deterioration. The question of deterioration is not strictly relevant and certainly not determinative of a later claim for whole person impairment. An assessment of whole person impairment is not based on a worker's subjective complaints of deterioration, but depends on an objective assessment based on the American Medical Association's Guides to the Evaluation of Permanent Impairment (5th edn) and the WorkCover Guidelines.
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65 I do not believe that allowing the matter to be referred to an AMS will be contrary to the Commission's objectives of providing a fair and cost effective system for the resolution of disputes under the Workers Compensation Acts (s 367). Once liability is determined, or, if there are no liability issues, the Commission must refer properly made claims for permanent impairment compensation to an AMS for assessment. If the claim has been made without proper justification and the AMS assesses a nil impairment for an injury that had previously been assessed at nil, the employer may have grounds, depending on an assessment of all the evidence, to make an application for costs under s 341(4). Further, unmeritorious applications that merely seek to cavil with a conclusive and binding MAC that has not been appealed under s 327 (or challenged in the Supreme Court) may also be liable to be dismissed as 'frivolous or vexatious or otherwise misconceived or lacking in substance' (s 354(7A)). The employer made no application under s 354(7A) in the present case.
66 The last point to note (though it was not argued by Consolidated, but may be relevant to future claims) is that there is no estoppel in a changing situation (The Doctrine of Res Judicata by Spencer Bower, Turner and Handley, 3rd edn, 1996, at page 102; O'Donel v Commissioner for Road Transport & Tramways [1938] HCA 15; 59 CLR 744; Dimovski; Hamersley Iron Pty Ltd v The National Competition Council [2008] FCA 598 at [114] to [116]; Prisk v Department of Ageing, Disability and Home Care (No 2) [2009] NSWWCCPD 13 at [55]). A claim for additional lump sum compensation is such a situation."
77Railcorp asserted that the Registrar failed to heed the decision in Superior Formwork Pty Ltd v Livaja. In that case the Presidential Member stated, at [95], [98], [99] and [107]:
"95 A MAC issued in earlier proceedings does not bind the parties in later proceedings unless the Commission has determined the issues in dispute in the earlier proceeding. Nor does it create an estoppel that is binding in later proceedings between the same parties. Had the first proceedings concluded with a determination by the Commission based on the terms of the Appeal Panel MAC, then, in the absence of a successful reconsideration application under section 350(3) of the 1998 Act, Mr Livaja would have had little prospect of avoiding the effect of that determination. However, in the absence of a determination in the first proceedings there is no reason in logic or in law why the Appeal Panel MAC is conclusively presumed to be correct in subsequent proceedings with which it was not concerned.
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98 The fallacy of the employer's argument is well illustrated if the roles are reversed. Say a worker obtained a favourable MAC in the first proceedings, but, because he or she wished to undergo further investigations in the hope of obtaining a higher assessment, decided to discontinue those proceedings before the Commission determined the dispute by issuing a Certificate of Determination. If, as a result of the investigations, the worker's whole person impairment were then assessed to be substantially lower, would the worker, in subsequent proceedings, be entitled to rely on the MAC issued in the discontinued proceedings? The answer is clearly 'no'. Because the worker discontinued the first proceedings before any binding determination by the Commission, the medical dispute would remain on foot and be referred to a second AMS for assessment in the second proceedings, having regard to the evidence tendered at that time. The MAC issued by the second AMS would (subject to any appeal under section 327) be conclusively presumed to be correct in the proceedings with which it is concerned, namely the proceedings in which it is issued.
99 If the Commission has determined the issues in dispute, an estoppel may arise that will bind the parties in the later proceedings. No estoppel arises in the present matter because Mr Livaja discontinued the first proceedings. However, the employer's argument seeks to elevate the Appeal Panel MAC in the first proceedings to the level of an estoppel. If no Certificate of Determination is issued (because the worker has discontinued the proceedings), the MAC in the first proceedings may be tendered as evidence in subsequent proceedings (as it was in the current proceedings), but is not conclusively presumed to be correct in those proceedings because they are not the proceedings 'with which the certificate is concerned'.
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107 ... A MAC is not conclusively presumed to be correct in relation to the particular matter in dispute in isolation of the proceedings with which it is concerned. It is conclusively presumed to be correct as to certain issues, but only in relation to any proceedings with which the certificate is concerned, whether those proceedings are in the Commission or in a court. The question is with which proceedings is the certificate 'concerned'. Not, with which dispute is the certificate concerned? In the present case, that question is capable of only one answer. The Appeal Panel MAC was issued in and 'concerned' with the first proceedings and it is therefore not conclusively presumed to be correct in the current proceedings."
78The MAC issued by Dr Schutz was concerned with Mrs Haroun's first application for lump sum compensation. This was confirmed by the Appeal Panel on 22 May 2007. However, the Appeal Panel MAC is not conclusively presumed to be correct in other proceedings. Dr Harvey-Sutton issued Mrs Haroun with a MAC which has assessed Mrs Haroun's WPI to be greater than the assessment of Dr Schutz in other proceedings.
79I do not agree with Railcorp's contention that the decision in Abou-Haidar v Consolidated Wire Pty Ltd is inconsistent with the decision in Superior Formwork Pty Ltd v Livaja. I accept that if Railcorp's contention is correct then the Registrar would have fallen into error. In Superior Formwork Pty Ltd v Livaja, it was held that a MAC issued in earlier proceedings does not bind parties in later proceedings unless the Commission has determined the issues in dispute in the earlier proceedings. Mrs Haroun's first proceedings were determined by the Commission and a Certificate of Determination was issued on 29 June 2007. However, in Superior Formwork Pty Ltd v Livaja at [104]-[105], it was said:
"104 ... a worker's medical condition is capable of change. It is now more than two years since the Appeal Panel MAC. As a matter of basic fairness there is no reason why a MAC that is two years old should now bind a worker, especially in circumstances where he has issued fresh proceedings suggesting, based on different evidence, his impairment is different to that assessed two years earlier.
105 Last, the relief sought in the current proceedings will merely result in the assessment of the whole person impairment resulting from the cervical spine injury being referred to an AMS for assessment. The assessment method requires the application of criteria in the American Medical Association, fifth edition, Guides to the Evaluation of Permanent Impairment, and the WorkCover Guide to Evaluation of Permanent Impairment. The method of assessment of whole person impairment is an objective one. The second AMS will assess the worker using the same objective criteria used by the Appeal Panel in the first proceedings. There is every possibility that the result will be the same or similar to that reached by the Appeal Panel. Thus, there is no injustice or unfairness to the employer. Rather than making a 'mockery of the legislative scheme', as the employer argues, it provides a fair and just application of the medical assessment process. An independent medical expert will assess the current claim in accordance with objective criteria. The result urged by the employer, however, would potentially result in an injustice to Mr Livaja because he would be bound by an assessment issued over two years ago in circumstances where the current medical evidence suggests that the earlier assessment was erroneous. "
80In Mrs Haroun's case, the MAC issued by Dr Schutz is now more than five years old. She was entitled under the law, as it existed at the time she made the application, to commence new proceedings for additional lump sum compensation. That claim was supported by a WPI assessment in the proper form that had a higher assessment than in the previous award or order of the Commission.
81In Prisk v Department of Ageing, Disability and Home Care (No 2) [2009] NSWWCCPD 13 at [55]-[60]:
"55 There is no issue estoppel in a changing situation (Spencer Bower, at p102 and Hamersley Iron Pty Ltd v The National Competition Council [2008] FCA 598 at [114] to [116]), and a later claim for hearing loss compensation as a result of a further injury is one example of such a situation. This point is succinctly illustrated in Spencer Bower (at [185]):
'An agreement to pay compensation registered under the Workmen's Compensation Acts estopped the employer from disputing liability for the accident; but not from contending that the worker's death did not result from it.'
56 The authorities cited in Spencer Bower are Cleverley v Gas Light and Coke Co (1907) 24 TLR 93 and O'Donel v Commissioner for Road Transport [1938] HCA 15; (1938) 59 CLR 744 ('O'Donel'). The authority of O'Donel is of particular significance and was considered and applied by Handley JA in Dimovski.
57 In Dimovski, the parties settled a claim by consent for 25% loss of use of a leg and an award was entered in those terms. In later proceedings the worker sought an additional payment under section 66 of the 1987 Act as a result of an alleged increase in the loss of use of the same leg due to further injuries. The trial judge held that the worker had sustained further injuries that had a permanent effect on the leg but she did not increase the award of 25%.
58 On appeal it was argued that the earlier consent award created estoppels, which meant that if the later injuries had a permanent effect then there had to be an increase in the percentage loss of use awarded. Justice Handley set out the principles at [9] to [12]:
'9 Mr King submitted that the Judge erred in law in failing to give effect to the estoppel created by the consent award by finding that although the worker had suffered further injuries to his left leg his current loss of use was still only 25%. A consent judgment can create res judicata estoppels: Spencer Bower, Turner & Handley "Res Judicata" 1996 pp 21-2. The estoppels flowing from the consent award bound the second respondent as a party and the appellant as a privy in interest, as the second respondent's statutory successor: Spencer Bower & Ors (above) pp 119-22.
10 The argument based on issue estoppel involved two propositions. The first was that the consent award conclusively determined that as at 16 October 1996 the worker had a permanent impairment of his left leg at or above the knee of 25% which was the result of an injury or injuries sustained in the employment of the second respondent. This is correct. The second was that he suffered two further injuries to his left leg in the employment of the appellant, one from the nature and conditions of his work, and the other the frank injury on 25 May 1998. This was also correct.
11 If these further injuries caused other than temporary aggravations of the worker's condition they must have increased the impairment in his left leg. The Judge did not find that they only caused temporary aggravations, but nevertheless found no increased impairment. Accordingly it was submitted that she had disregarded the estoppel. Mr King relied strongly on her statement that the consent award was 'possibly not reflective of an accurate assessment'.
12 These submissions must be rejected because they are contrary to the principles established in O'Donel v Commissioner for Road Transport [1938] HCA 15; (1938) 59 CLR 744. A decision that a worker's total blindness between 14 September 1934 and 15 February 1935 arose from an injury in the course of his employment was held not to issue estop the employer from contending that his blindness after 15 February 1935 arose from other causes. Evatt J said at 763:
"The argument involves and is based upon the fallacy that where an issue between A and B related to a state of things which is capable of subsequent alteration, the conclusive determination in A's favour of that state of things as at one date plus conclusive proof that up to a later day there has been no alteration of such state of things establishes in A's favour as against B an estoppel as to the state of things existing at the later day ... this method, thought logically sound, is not permitted by law ... The unsuccessful party is bound by the authoritative determination of every fundamental issue but when a distinct and separate issue arises subsequently, he is not bound to submit to the second issue being established by the combination of a former issue with additional evidence, no matter how strong such evidence may be".'
59 Dealing specifically with the consent awards, his Honour said (at [14]):
'The consent award involved admissions by the parties and these, coupled with the presumption of continuance, were of some weight. However there was much other evidence, lay and expert, relating to the worker's impairment at the later date and the weight to be given to the admissions and the presumption of continuance was a question of fact for the Judge.' (emphasis added)
60 In the same case Hodgson JA said (at [57]):
'The inconsistency point was supported by submissions concerning issue estoppel. However, although an issue estoppel binds the parties as to the issues actually determined, they are not bound in relation to any different issue, not even where the combination of the original issue and extremely strong evidence would support a finding on the second issue: see O'Donel v. The Commissioner for Road Transport and Tramways (NSW) (1938) 59 CLR 747 at 763.'"
82There is no issue estoppel created by the first determination that operates to restrict the determination of any subsequent medical re-assessment. The present case is one where the initial determination may be reassessed at a later date if the injury has the potential to cause a subsequent variation of the degree of whole person impairment. Accordingly, the issue estoppel created by the first determination is limited strictly to the degree of impairment at the date of that determination, and does not impinge on the re-assessment of subsequent impairment.
83Prisk v Department of Ageing, Disability and Home Care (No 2) and Abou-Haidar v Consolidated Wire Pty Ltd establish there is no issue estoppel running from a determination of the Commission as at a particular date to an assessment at a later time in circumstances capable of change. The Registrar stated at [11] that a degree of permanent impairment or loss of use that results from injury is a circumstance capable of change. The role of an Approved Medical Specialist at a later time is to give an opinion as to the degree of permanent impairment as a result of the work injury now present. The Approved Medical Specialist is not legally constrained by the prior award and is not required to ground their assessment, whether of improvement, deterioration or no discernible change, upon the previous determination of the commission. Any presumption of continuance falls away because the later certificate of the Approved Medical Specialist is conclusively presumed to be correct in that regard.
84Dr Harvey-Sutton found a greater degree of impairment than Dr Schutz. The plaintiff asserted that Dr Harvey-Sutton failed to refer to Dr Schutz's assessment in her MAC. It was submitted that this failure was a demonstrable error or established that Dr Harvey-Sutton had applied incorrect criteria. The Registrar stated correctly at [11]-[12] that the role of an Approved Medical Specialist is to give an opinion as to the degree of impairment at the time of the examination without the legal constraint from any prior award. The Approved Medical Specialist is entitled to apply their expertise on the day of the examination.
85The result is that the application by Railcorp for judicial review fails. The redetermination dated 7 November 2011 and the decision of the Medical Appeal Panel dated 9 March 2012 are correct and should not be set aside.
86Costs are discretionary. Costs normally follow the event. The plaintiff's claim for judicial review fails. Costs are discretionary. Costs usually follow the event. The plaintiff is to pay the second defendant's costs as agreed or assessed.