Sapina v Coles Myer Limited

It was common ground in the appeal to the Presidential member that the Arbitrator had at no point in time expressed her conclusions in terms of whether Ms Sapina's injury was "wholly or predominantly caused by" the counselling session. The Arbitrator found that the counselling session constituted "reasonable action" taken by Coles Myer. 14 In the appeal to the Presidential member under WIM Act, s 352 the appellant did not challenge the Arbitrator's application of s 9A, but complained that the Arbitrator had omitted to state her understanding of the "whole or predominant cause" requirement in the WCA s 11A. The appellant also complained that the Arbitrator's findings of fact could not satisfy the relevant causation test. 15 The Presidential member dealt with the appeal under s 354(6). Accordingly, the Presidential member had before him the same material as was before the Arbitrator together with additional submissions from the parties relating to the appeal. In his reasons he indicated that he was satisfied that he had sufficient information to proceed "on the papers" without holding any conference or formal hearing. 16 The Presidential member handed down his decision on 18 January 2008. He dismissed the appeal and entered an award in favour of Coles Myer.

Consideration Nature of Appeal under s 352 WIM Act 17 Although Ground of Appeal 3 specifically raises this issue, it also underlies and has application to Grounds of Appeal 1 and 2. Accordingly, before referring in detail to the reasons of the Presidential member, it is necessary to explain clearly the nature of an appeal pursuant to the WIM Act, s 352. 18 The proper approach by a Presidential member to the task of an "appeal … by way of review" for the purposes of the WIM Act, s 352 has been discussed by this Court on a number of occasions.

19 In State Transit Authority of New South Wales v Chemler [2007] NSWCA 249 Spigelman CJ (with whom Basten JA and Bryson JA agreed, the former adding some relevant further comments of his own) discussed the notion of appeal by way of review under s 352. The case concerned (as here) the application of the WCA, ss 9A and 11A. Mr Chemler claimed to have been subjected to racial harassment and vilification at the workplace causing psychological injury. An earlier Court of Appeal decision ([2006] NSWCA 249) had set aside an earlier decision of the Presidential member. The complaint made by Mr Chemler on the second appeal in point of law to the Court of Appeal (the WIM Act, s 353 (1)) was that the Presidential member should have given respect to the conclusion of the Arbitrator who saw the witnesses and should, at least, have remitted the matter to a "fact finder" so that "the witnesses could be heard and seen". This submission carried with it a proposition involving a very limited notion of "review" by the Presidential member, and a limit upon the power to make a new decision under s 352 (7). 20 The Chief Justice made clear at [22] and [28]-[30] that the task of the Presidential member was to conduct an appeal by way of review on the merits and that this course was an important safeguard for the proper operation of the legislative scheme. The Chief Justice stated the following at [28]-[30]: "[28] The concept of a review on the merits is wider than the concept of an appeal in a judicial context. There is a well established line of authority on the use of the terminology of 'review' instead of 'appeal' with respect to the workers compensation system in this State which establishes the breadth of a review on the merits. [29] That line of authority is also inconsistent with the kind of restriction on the powers of a Presidential member for which the Appellant contends. (See Mansini v Director General of Education (1990) 6 NSWCCR 1 at pp4-20; Watson v Hanimex Colour Services Pty Limited (1992) 8 NSWCCR 190 at 199-206; Boston Clothing Co v Margaronis (1992) 27 NSWLR 580 at 584-585; Litynski v Albion Steel Pty Limited (1994) 10 NSWCCR 287 at 295-297, c/f 298-300; Aluminium Louvres & Ceilings Pty Limited v Zheng [2006] NSWCA 34 at [38]; South Western Area Health Service v Edmonds [2007] NSWCA 16 at [133]-[134].) [30] A Presidential member exercising a power to review a decision must decide whether the original decision is wrong or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view . If s/he does so decide then s/he should substitute his or her own views, unless it is an appropriate case to remit. The power to remit is not constrained in the manner for which the Appellant contends." (emphasis added) 21 It is necessary to refer to the cases referred to by the Chief Justice at [29] at some length to ensure that the content of the Chief Justice's reasons are pellucid. 22 In Mansini at 4-20 Burke CCJ in a comprehensive analysis, set out the notion of "review" in the Compensation Court Act 1984 (NSW), s 36(1), which was in the following terms: "(1) Where a commissioner or a registrar makes a decision or does any other act in any proceedings, the Court may, on application by any party, review the decision or act, and may make such order by way of confirmation, variation or discharge or otherwise as the Court thinks fit." 23 He made it clear (at 19-20) that "review" was a word of wide import, not limited by the notion of appeal in the strict sense of finding error. Given that his Honour's views were shortly thereafter subsumed by comprehensively expressed views in judgments of this Court, it is unnecessary to set out in full his Honour's views. Nevertheless, it is of assistance to understand (because Spigelman CJ referred to them) that Burke CCJ's views were that "review" in this context contemplated an unfettered reconsideration or re-evaluation of the decision below and of the material upon which it was based. The judge was not bound by the parameters of the usual forms of appeal, whether by way of rehearing or in the strict sense. 24 In Watson at 199-206, Kirby P considered the meaning of "appeal" and "review" in the context of the same s 36. His Honour concluded at 199 that it was plain from the history of the legislation that a "review" was not an "appeal" as such. Kirby P then analysed the meaning of "review", saying the following at 205-206: "… [I]t is undesirable to attempt to delimit exactly the scope of a 'review' as contemplated by section 36 of the Act. Given the juxtaposition with 'appeal', I would certainly agree to the appellant's proposition that something wider than the narrow form of reconsideration on an appeal, strictly so called, is contemplated. The fact that there is a decision of the Commissioner which is being 'reviewed' postulated that the Judge of the Compensation Court will not start with a blank page but with a formal decision of a person who, in making it, is 'taken to be the Court'. Thus, unless the 'review' persuades the Judge that the order being reviewed should be varied, discharged or otherwise disturbed, the order under 'review' will stand and be binding between the parties. This suggests the need, on the part of the aggrieved party, to provide some proper basis for disturbing the decision under challenge. Invoking the review procedure does not sweep aside the effect of the decision. It remains valid unless the Judge, on review, otherwise orders. I would also agree that the 'review' is not confined to the narrow kind of 'appeal' allowed from discretionary decisions where some error of principle must be shown. Nor do I believe that the intention of Parliament in providing for a 'review' was to make it harder for a party challenging a decision to secure effective reconsideration by a judge than would have been the case if an 'appeal' had been retained as previously provided. There are various reasons for so concluding. They include the two-tiered structure of the Compensation Court; the kinds of matters normally to be assigned to commissioners; the provision (in the future) for a general appeal including on facts from awards of the Judges; the importance of the decisions that may be made by commissioners affecting the welfare of workers and imposing significant obligations of employers; and the fact that (prerogative process apart) no other means of reconsideration is available to a disaffected party than the 'review' provided by section 36. All of these indicia suggest that, in a proper case, it will be open to a judge of the Compensation Court, conducting a review, to permit evidence to be adduced before him or her. Such evidence may be a repetition of the whole or part of the evidence taken before the Commissioner. Or it may be entirely fresh evidence which was not received before the Commissioner or even offered there." 25 These views of Kirby P might be seen to draw back somewhat from what Burke CCJ had said in Mansini. Aspects of Burke CCJ's description put one in mind of a complete hearing de novo. For example he said in Mansini at 19: "[I]t is essentially a retrial of the issues …", though, shortly thereafter he said, "if a transcript etc is available, it will be usually done on the documents." Kirby P, on the other hand, clearly identified a review as wider than an appeal "strictly so called". His Honour can thus be seen to describe the process as more than merely the correction of error. Even in an appeal by way of rehearing the task of the correction of error takes its place: see Fox v Percy (2003) 214 CLR 118 and the other High Court authorities referred to in Costa v Public Trustee [2008] NSWCA 223 and in Branir v Owston Nominees (No 2) Pty Limited [2001] FCA 1833; 117 FCR 424 at [20]-[32], including Allesch v Maunz [2000] HCA 40; 203 CLR 172. 26 The Presidential member cited Allesch v Maunz in support of the proposition that his task was the correction of error. That was, as these reasons seek to demonstrate, the wrong test for "an appeal by way of review". It was also an incomplete description of the task of an appeal by way of rehearing (though that concept is not the relevant test for his task either). 27 In Watson, Handley JA agreed "generally" with Kirby P's reasons, subject to some comments as to a particular rule of the Compensation Court Rules concerning the recalling witnesses. Hope AJA agreed with Kirby P's reasons, subject to the qualifications of Handley JA. Their Honours took a somewhat more limited view than Kirby P of the calling of evidence on review not called before the Commissioner. 28 Watson was reconsidered in Agfa-Gavaert Ltd v Lee [1992] NSWCA 4. No doubt was cast on its correctness. 29 In Boston Clothing, the submission was put that "review" was more limited than appeal. Kirby P (with whom Waddell AJA and Samuels AJA agreed) described the submission as follows at 587: "The employer urged that the function of 'review' in this case should be assimilated to the review by a court of a registrar's decision. It was much more circumscribed than an appeal. There was to be no disturbance except 'in an extreme case': see Schweppes (at 183; 72-73) (a case of a 'review' of a decision of a taxing officer of the court). Alternatively, it was put 'review' was confined to cases where there were 'real and substantial grounds for questioning [the] correctness' of the primary decision: see Street J in Duffy v Super Centre Development Corporation Ltd [1967] 1 NSWR 382 at 383 (a case of a 'review' of the decision of a court-appointed receiver and manager of a company)." 30 Kirby P rejected this submission, saying at 587: "Care must be taken in lifting these judicial comments out of their context. The meaning to be ascribed to 'review' in statutory provisions for the superintendence of decisions of taxing officers on bills of costs and receivers and managers administering a company under order of the court is quite different from the meaning to be given to 'review' by a judge of a decision of a commissioner of the Compensation Court. As has been pointed out, the commissioner is, for the purpose of the Act, the Compensation Court. The decisions made affect very substantial rights. They have large consequences both for the worker and the employer. They are not confined to minutiae or to detailed administrative or like decisions. They determine substantive entitlements under a statute often intended to provide a means of sustenance for injured workers. There is nothing in the Act which would warrant confining the 'review' performed by a judge to the very narrow circumstances and limited cases suggested by the employer here. On the contrary, the history of the legislation and the nature and purpose of the function assigned to the judge suggest, as Watson held, that a much larger power was conferred by the facility of review. It was a power which no doubt took into account the respective training, experience and office of the judges of the Compensation Court and of the commissioners: see Compensation Court Act , s 22(3). The first submission of the employer is in my view contrary to the holding of this Court in Watson . It adopted an unduly narrow view of the function of the judge on 'review'. It should therefore be rejected." 31 Two aspects should be noted about this passage. First, it restated the view in Watson that the review process was wider than the appeal process strictly so-called and wider than cases of review of the kind exhibited in Schweppes Ltd v Archer (1934) 34 SR (NSW) 178 and Duffy v Super Centre Development Corporation Ltd [1967] 1 NSWR 382 referred to in Boston Clothing at 587 and similar cases referred to in Watson at 203-205. Secondly, the views in Watson that recognised a place for respect to be given to the decision of the Commissioner were reaffirmed. 32 In Litynski at 296-297, Gleeson CJ (with whom Handley JA agreed) discussed the notion of review in s 36, pointing out that while it was not a dealing with the whole matter afresh or de novo, it nevertheless was a wide concept. The context of Litynski was an appeal from a decision of Burke CCJ that had been given before Watson and Boston Clothing were published. When the review came on for hearing before Burke CCJ, new counsel sought, without notice, to run an entirely different case with additional evidence. Burke CCJ declined the application. The argument was that, in so concluding, Burke CCJ had unduly restricted the nature of the review. Gleeson CJ disagreed, saying at 296-297: "… [I]n his judgment in the present case Burke CCJ said that he was prepared to assume that section 36 provided for the widest form of review. He did not mean, and nobody has ever suggested, that the procedure which section 36 allows is the same as the procedure involved on an appeal from a magistrate to a District Court Judge. That is a special procedure which has its origin in historical circumstances discussed in R v. Longshaw (1990) 20 NSWLR 564. A person convicted before a justice of the peace had a right to have the case reheard by a Court of Quarter Sessions whose obligation was to deal with the whole matter afresh, subject to any procedural provisions laid down by statute. Here we are concerned with a discretionary power of review, and, accepting that the concept of review is wider and more flexible than at least most forms of appeal, the very existence of the power of a Compensation Court Judge to decline review raises the possibility of the need to consider questions of the kind addressed by Burke CCJ." 33 Gleeson CJ referred to Watson and Boston Clothing, without any disapproval. Further, though Kirby P was in dissent, as the author of the leading judgments in Watson and Boston Clothing, his comments at 299-230 are apposite: "Compensation legislation is beneficial and protective of workers who allege that they were injured at work. The facility for a 'review', whether at the behest of a worker, an employer or an insurer, should not be given a narrow construction. This Court has now repeatedly so held." 34 It is important, also, to repeat something said by Kirby P in Australian Gas Light Co v Samuels (1993) 9 NSWCCR 616 at 623 (though in dissent): " ... The process of 'review' is a special procedure, established within a specialised tribunal, to recognise the particular skills which judges of that tribunal enjoy and refine by years of considering very large numbers of like claims, many of them in large part (as here) determined on paper without oral evidence."

Whilst not precisely reflecting the present structure of Arbitrators and Presidential members, this passage does remind one of the importance in the present structure of the proper role of the deployment of the particular skills of the Presidential members to provide merits review. 35 In AGL v Samuels, Meagher JA said at 625 about "review": "What is involved in a 'review' was considered by this Court in Watson v Hanimex Colour Services Pty Ltd (1992) 8 NSWCCR 190. This means that the Judge had wider powers than would be involved in a mere appeal, but not so wide as to treat the primary decision as if it did not exist." 36 Handley JA referred at 630 to Watson and Boston Clothing as elucidating the proper scope for review. 37 In Aluminium Louvres v Zheng, Bryson JA (with whom Handley JA and Bell J agree) was dealing with the WIM Act, s 352 and said the following at [38]: "A review is a different process to an appeal and the matters which may be considered and the manner in which they may be considered are somewhat wider. See Boston Clothing Co Pty Ltd v. Margaronis … at 584 (Kirby P). An attack, on review or otherwise, on an Arbitrator's discretionary decision in controlling procedure may be based on the test stated in House v. R (1936) 55 CLR 499 at 504 - 505; but that is not the only basis on which the Presidential member may act. The powers of a Presidential member on review are somewhat wider and extend to power to reopen consideration of a matter of which an Arbitrator has disposed; the manner in which the powers of the Presidential member are to be exercised is itself the subject of discretion of the Presidential member. I see no ground upon which it could be doubted that the Deputy President acted within her discretionary powers in disposing of the matter as she did. No rule of law required the Arbitrator not to limit cross-examination, and the view that there was no want of procedural fairness was a view which the Deputy President could reasonably reach without any error of law."

In this case, the Arbitrator had limited cross examination. The Presidential member had concluded that there was no denial of procedural fairness. 38 In South West Area Health Service v Edmonds McColl JA (with whom Giles JA and Tobias JA relevantly agreed) cited Bryson JA in Aluminium Louvres v Zheng at [134] with approval. 39 In Department of Education & Training v Sinclair [2005] NSWCA 465, Spigelman CJ (with whom Hodgson JA and Bryson JA agreed) found error in the approach of Sheahan J and said at [67]-[69]: "[67] Sheahan J was exercising a statutory jurisdiction to 'review' the Arbitrator's decision. His Honour conducted a reassessment of the evidence with respect to whether the Appellant had discharged the onus (assumed by all parties to rest with the Appellant) that the sole or 'predominant cause' of the psychological injury suffered by the Respondent was 'reasonable action taken or proposed to be taken … with respect to discipline'. His Honour rejected one of the grounds upon which the Arbitrator relied, i.e. that the transfer was not reasonable. Nothing in his Honour's reasons indicated that he thereupon applied the statutory formula and made his own judgment in this respect. [68] The Appellant submits that his Honour either failed to apply the statutory formula or he failed to set out his reasons. In either event a point of law arises which entitles this Court to intervene. [69] In view of the submission made to him, in my opinion, it was necessary for his Honour to form his own judgment as to whether or not the sole or predominant cause of the employer's contribution to the Respondent's psychological injury was reasonable action on the part of the Appellant, and to express reasons for that conclusion. The statutory test could not be satisfied merely by identifying two respects in which the Appellant's conduct was unreasonable. It remained necessary to determine whether, notwithstanding those blemishes in the decision-making process, 'reasonable action' was the sole or predominant cause. On the submissions before his Honour, it was incumbent upon him to determine whether or not the sole or predominant cause was the employer's reasonable action, in circumstances where the investigation itself, the delay in completing it, and the Transfer, were all found to be reasonable. His Honour did not address that issue." (emphasis added)

40 In Chemler, Basten JA made the following further comments at [63]-[65]: "[63] The procedural challenge must therefore depend upon the proposition, as put in written submissions, that it was 'not open' to the Deputy President to reverse a finding of fact made by the arbitrator. This proposition was based on the assertion that the appeal undertaken by the Deputy President was in the nature of a 'review' and was therefore not a hearing de novo. By that it was presumably meant that because s 352(1) permitted an 'appeal' against the decision of an arbitrator, the Presidential member considering the appeal was required to identify error on the part of the arbitrator. [64] There are several difficulties with that approach. First, it appears to depend upon the classification of appeals in accordance with the terminology adopted in Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616 at 621-622 (Mason J) and more recently identified in Coal and Allied Operations Pty Ltd v Australian Industrials Relations Commission (2000) 203 CLR 194 at [11]-[14]. Even if the appeal were to be placed in one class rather than another, as a matter of statutory construction the nature of the appeal by way of review should not be seen to be so constrained. Section 352(7) permits a Presidential member to confirm a decision or to revoke it and make a 'new decision' in its place. Further, s 354 permits the Commission to conduct its proceedings with as little formality and technicality as the proper consideration of the matter permits, not to be bound by the rules of evidence and to act according to 'equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms': s 354(3). In particular, the Commission is relieved of any obligation to conduct proceedings 'by formal hearing' and may conduct them by way of 'a conference between the parties', or 'without holding any conference or formal hearing': s 354(4) and (6). [65] The precise scope of a provision such as s 354 will depend upon the circumstances in which its operation arises. No doubt the Commission is required to apply substantive rules of law applicable to its jurisdiction and to comply with rules of procedural fairness, although the content of the latter may be affected by the terms of the provision: see generally Sue v Hill (1999) 199 CLR 462 at [42] (Gleeson CJ, Gummow and Hayne JJ); Qantas Airways Ltd v Gubbins (1992) 28 NSWLR 26 at 29 (Gleeson CJ and Handley JA); Italiano v Carbone [2005] NSWCA 177 at [70]; South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [87]-[94] (McColl JA, Tobias and Giles JJA agreeing), and Haider v JP Morgan Holdings Aust Ltd [2007] NSWCA 158 at [42]. So long as each party has notice of, and a reasonable opportunity to address, the case against it, there is no reason to suppose that the Commission is not at liberty to determine how it will proceed and whether it should make a new decision. A different approach may apply in relation to a grant of leave to appeal, but that is not in issue in the present case: cf Re Coldham; Ex parte Brideson [No. 2] (1990) 170 CLR 267 at 275 (Deane, Gaudron and McHugh JJ)." 41 In Fletcher International Exports Pty Ltd v Barrow [2007] NSWCA 244 at [19] Mason P (with whom Santow JA and Tobias JA agreed) referred to Watson and Aluminium Louvres v Zheng as explicatory of the notion of appeal by way of review in s 352(5).

42 In Siddick v WorkCover Authority of New South Wales [2008] NSWCA 116, at [70]-[81], McColl JA (with whom Mason P and Giles JA agreed) examined the notion of "review" in the context of the WIM Act, s 328 and referred to Watson, Boston Clothing, AGL v Samuels, Litynski, Aluminium Louvres v Zheng and Chemler. 43 In Duinker v St Vincent de Paul Society Aged and Special Services Limited (Lewisham Nursing Home) [2008] NSWCA 127 the question was as to how findings of credit by the Arbitrator should be dealt with by the Presidential member on appeal by way of review. Hodgson JA (with whom Beazley JA and McColl JA agreed) referred to Watson, Boston Clothing, Chemler and Edmonds. His Honour then posed these questions at [31]: "[31] These passages in Chemler raise but do not clearly resolve two questions relevant to the present case: (1) Does the Presidential member have to identify an error before intervening? (2) Is the Presidential member bound to apply the Abalos principle?" 44 His Honour then said the following at [32]-[33]: "[32] As regards the first question, it is generally the case that an appeal court, dealing with an appeal from a first instance judge, will not intervene on a question of fact unless it is affirmatively satisfied that the decision of the first instance judge is wrong. This is particularly significant in relation to matters on which minds may reasonably differ, such as an assessment of what reasonable care requires. In relation to such matters, an appeal court recognises that minds may reasonably differ, and even if its own view, if it were approaching the matter de novo , would be different from that of the primary judge, it will not substitute its own view unless it is satisfied that the primary judge's view is wrong, in the sense of being one not reasonably available or vitiated by some error. A question whether this approach applies in the case of a review under s 353 of the WIM Act could be significant, particularly in relation to a question whether a worker's employment was a 'substantial contributing factor' to an injury, within s 9A of the Workers Compensation Act 1987. The discussion by Basten JA at par [63]-[66] in Chemler suggests that this approach would not apply, so that it would be open to a Presidential member carrying out a review under s 353 of the WIM Act to substitute his or her own preferred view on such a question, even if he or she was not affirmatively satisfied that the Arbitrator's view was wrong. Paragraph [29] in the judgment of Spigelman CJ in Chemler also tends to support that view. [33] As regards the second question, it is clear that the Presidential member conducting such a review must apply substantive rules of law and must accord procedural fairness; but it is doubtful whether s 354 is consistent with an obligation on a Presidential member, as a matter of law, to apply the principle of Abalos . Again, the discussion in Chemler seems to suggest that it is not."

45 Hodgson JA was able to decide the appeal on the arguments put before the Court by assuming that the Abalos principle had to be followed. His Honour therefore did not have to answer the two questions posed by him at [31], though his views are probably clear at [32] and [33]. 46 In Jeffery v Lintipal Pty Limited [2008] NSWCA 138, Basten JA (with whom Hodgson JA relevantly agreed) said the following at [11] in response to an argument (that was abandoned) that the Presidential member was restricted to the correction of error in the Arbitrator: "[11] The first ground of appeal alleged error in law on the part of the Deputy President in 'rehearing the matter when the Arbitrator's decision was not affected by any legal, factual or discretionary error'. The employer was entitled to appeal against the decision of the Arbitrator with leave of the Commission: Workplace Injury Act , s 352(1). The Deputy President considered whether the statutory preconditions to a grant of leave were satisfied and held that they were: at [12]. There could be no challenge to this decision. Pursuant to s 352(5), the appeal to the Deputy President was to be 'by way of review of the decision appealed against'. Whether the Deputy President required to be satisfied of 'error' on the part of the Arbitrator, before revoking his decision, is doubtful: see State Transit Authority of New South Wales v Chemler [2007] NSWCA 249 at [28]-[29] (Spigelman CJ, Bryson JA agreeing) and [63]-[66]; see also Watson v Hanimex Colour Services Pty Ltd (1991) 8 NSWCCR 190 at 205-206 (Kirby P) and 210-211 (Handley JA and Hope AJA); Boston Clothing Co Pty Ltd v Margaronis (1992) 27 NSWLR 580 at 584-585 (Kirby P, Waddell AJA and Samuels AJA agreeing) and Aluminium Louvres & Ceilings Pty Ltd v Xue Qin Zheng [2006] NSWCA 34 at [38] (Bryson JA, Handley JA and Bell J agreeing). In any event, this ground was abandoned at the hearing of the appeal."

47 In Cook v Midpart Pty Ltd [2008] NSWCA 151, Allsop P said the following at [10] (with which Ipp JA and Bell JA agreed): "[10] The decision of this Court in Duinker v St Vincent de Paul Society Aged and Special Services Limited (Lewisham Nursing Home) [2008] NSWCA 127 at [32] (Hodgson JA, with whom Beazley JA and McColl JA agreed), the discussion in State Transit Authority of New South Wales v Chemler [2007] NSWCA 249 at [22]-[29] (Spigelman CJ, with whom Basten JA and Bryson AJA agreed) and [63]-[66] (Basten JA), and Jeffery v Lintipal Pty Limited [2008] NSWCA 138 at [11] (Basten JA, with whom Hodgson JA agreed) provide powerful support for the proposition that the appeal in s352 of the WIM Act that is to be 'by way of review' (s352(6)) is not limited to the identification and correction of error on the part of the Arbitrator. (That is not to say, however, that any demonstrated error would not be persuasive in any appeal.) I will return to the consequences of the approach of the Presidential member at the end of these reasons."

48 In Ric Developments v Muir [2008] NSWCA 155 at [24] Campbell JA noted that the Presidential member had expressed the view that under an appeal by way of review under s 352 there was only power to revoke a decision of an Arbitrator and substitute a new decision of the decision of an Arbitrator was attended by some legal, factual or discretionary error. Campbell JA noted that "there might be room to argue" that this was too narrow a view. The point had not been taken. It was, in fact, too narrow a view. 49 In Tan v National Australia Bank Ltd [2008] NSWCA 198 at [6] Basten JA (with whom Bell JA agreed) said: "[6] The Commission has tended to disregard decisions of this Court relating to statutory appeals under the Compensation Court Act 1984 (NSW) now repealed. Those decisions, including Boston Clothing Co Pty Ltd v Margaronis (1992) 27 NSWLR 580, should properly be treated with caution, although they undoubtedly provide some assistance with the meaning of the term 'review'. However, as explained in Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10; 183 CLR 245 at 261, by Mason CJ, Brennan and Toohey JJ: 'But what emerges from the judicial decisions and, for that matter, from statutes is that 'review' has no settled pre-determined meaning; it takes its meaning from the context in which it appears.'"

50 We agree with Basten JA that the earlier decisions on the Compensation Court Act dealing with a statutory structure in different terms should be treated with caution. This much is clear from what we have earlier said at [34] above. These decisions do, however, as Basten JA rightly, with respect, recognised, give real guidance as to the meaning of "review". So much is also clear from the use made of these decisions by the Chief Justice in Chemler.

51 In Tan, Basten JA at [8] made clear (as, with respect, must be correct) that the nature of the appeal by way of review in s 352 (1) and (5) must be understood by reference to the statutory scheme of the WIM Act, and in particular ss 352 and 354. 52 Basten JA stated the following at [9]-[12]: "[9] A primary feature of the appeal provided by s 352 is the degree of control placed in the presidential member with respect to both the availability of the appeal and the manner in which it is to be conducted. Thus the appeal only lies with leave of a presidential member: s 352(1). Leave may not be granted where the amount in issue is less than $5,000 and the proportion of the award in issue is less than 20%: s 352(2). Once those factors are established, there is no express guidance in the statute as to what other matters might affect the grant of leave and in the present case, subject to questions of timely filing of documents, leave appears to have been granted to both parties as a matter of course. The appeal is described as being 'by way of review': sub-s (5). The section further provides that other 'evidence' may not be given on the appeal except with leave of the Commission: sub-s (6). The reference to 'evidence' is to be understood in a broad sense, as the Commission is not bound by the rules of evidence and may inform itself in such manner as it thinks appropriate: s 354(2). Finally, the powers of the Deputy President on appeal permit the confirmation, revocation and remittal of the decision of the arbitrator and the making of a new decision in its place: s 352(7). [10] Where an appellate tribunal has power to hear further evidence, the appeal will commonly be one by way of rehearing, which requires determination of the appeal in accordance with the facts and law as they appear to the appellate tribunal. If the facts presented, or law applicable, on the appeal differ from those considered at the first hearing, it may seem inappropriate to say that the original decision-maker has erred; rather, it may be preferable to describe the decision as erroneous. An example may be found in Western Australia v Ward [2002] HCA 28; 213 CLR 1 where a particular 'error' arose from statutory amendments which came into effect after the trial judgment was delivered: see [65]-[71]. [11] Where the statute refers to an 'appeal', as opposed to a review, it may be intended that the appellate tribunal could vary or discharge the decision below only if satisfied that it was affected by a relevant error. However, the concept of an 'appeal' does not necessarily invoke the precondition of a finding of error: an appeal may be by way of hearing de novo , where 'the matter is heard afresh and a decision is given on the evidence presented at that hearing': Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; 203 CLR 194 at [13]. Furthermore, as noted in McKee v Allianz Australia Insurance Ltd [2008] NSWCA 163 at [64], the term 'review' may connote a fresh consideration of a matter, without the need to find error before setting aside or varying the decision below. But even in a hearing de novo the appellate tribunal will not necessarily disregard conclusions reached by the original decision-maker. Constraints may arise at various stages. First, in deciding the primary facts, the appellate tribunal may defer to findings made by a decision-maker who has resolved conflicts in the course of hearing and assessing oral testimony. In such a case, the appellate tribunal which does not hear the witnesses, will be constrained to approach the findings in a manner similar to that described in Fox v Percy [2003] HCA 22; 214 CLR 118. Secondly, the appellate tribunal may be constrained in drawing inferences, not having seen the witnesses, but to a lesser extent, for reasons analogous to those identified in Warren v Coombes [1979] HCA 9; 142 CLR 531 at 551, despite there being no need to find error. Thirdly, a similar constraint may arise in relation to the exercise of a discretionary power, again recognising that the appellate tribunal may not be required to find error: cf House v The King [1936] HCA 40; 55 CLR 499 at 505. [12] The fact that the term 'appeal' may refer to a hearing de novo , the fact that the appeal is described as one 'by way of review', together with the largely unlimited discretion conferred on the Deputy President as to the manner in which the appeal will be conducted and the broad powers, including the power to make a 'new decision' in place of that subject to appeal, all tend to confirm that the Deputy President may conduct a fresh hearing and is not constrained to intervene only if satisfied that the decision of the arbitrator was affected by identifiable error. There is no need to consider the constraints on the Deputy President which may arise from the circumstance that the arbitrator made findings based on credit in respect of oral testimony, where witnesses were not recalled on appeal." (emphasis added)

53 Young CJ in Eq stated the content of an appeal by way of review under s 352 differently. His Honour said at [60]: "[60] Both parties appealed the determination of the arbitrator under s 352 of the WIM Act . In an appeal to the Commission constituted by a presidential member from an arbitrator's decision, the question to ask is whether the arbitrator erred, either by way of law, fact or discretion: see Allesch v Maunz (2000) 203 CLR 172 at 180. If such an error is established, and it is such that, but for it, a different decision would have been made, the presidential member determining the appeal may revoke the arbitrator's decision and substitute a different reason for it, or may remit the matter to the arbitrator concerned or a different arbitrator for determination in accordance with any decision or directions of the Commission: see s 352(7) of the WIM Act." This approach of Young CJ in Eq was, as a statement of the task of the Presidential member, with respect, wrong. 54 In Akora Holdings Pty Ltd v Ljubicic [2008] NSWCA 339, Basten JA (with whom Hodgson JA and Campbell JA agreed) rejected, in terms, the proposition that demonstration of error in the Arbitrator's decision was a necessary precondition for intervention. At [6] his Honour said: "[6] On 12 February 2007, the Commission issued a certificate recording the determination of the arbitrator terminating the award (and hence the compensation payments) from 6 October 2004. An appeal from that decision was available to a Presidential member, pursuant to s 352 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ('the Workplace Injury Act '). Such an appeal was described as being 'by way of review of the decision appealed against': s 352(5). Further evidence could be received by the Commission on appeal, but only by leave: s 352(6). The nature of such a review has been the subject of consideration in this Court on a number of occasions: see Cook v Midpart Pty Ltd trading as McDonalds Forster [2008] NSWCA 151 at [10] (Allsop P, Ipp and Bell JJA agreeing). There is no requirement for the Presidential member to identify an error of law, or probably a specific error of any kind, in order to intervene."

55 The view that was expressed by the Presidential member in the present case that demonstration of error in the Arbitrator's decision is a precondition of any intervention and of any action under s 352(7) was, with respect, wrong. 56 The Chief Justice in Chemler at [30] used the expression "true and correct view". In the context of merits review of administrative decisions the phrase "preferable or correct decision" has developed a currency and lineage: Drake v Minister for Immigration and Ethnic Affairs (1979) 24 ALR 577; 46 FLR 409 at 589; 419. Given the Chief Justice's reference to "merits review" at [28], we would not take his language at [30] as intended to be other than synonymous with the "preferable or correct decision" as a long-used and well-understood description of the task of a body undertaking merits review: Aronson, Dyer and Groves Judicial Review of Administrative Action, 3rd Ed (2004) at 158; and Denn v Midland Brick Co Pty Ltd (1985) 157 CLR 398 at 419. We will use the form of words used by the Chief Justice in this sense. 57 Whilst the new regime of dealing with workers' compensation claims must be examined in its own statutory context, it is important to appreciate that the legislature has used a phrase that had in the prior regime, a tolerably settled meaning. Section 36 of the Compensation Court Act used the phrase "review the decision". Subsections s 352 (1) and (5) of the WIM Act make clear that the "appeal" is to be by way of review of the decision. The notion of "review of a decision" had been clearly held in the context of the former legislation and the WIM Act to be wider that an appeal strictly so-called and encompassing a reconsideration beyond correction of error. The decision under appeal is not to be ignored, but the task of the Presidential member is, as Spigelman CJ said in Chemler, "to decide whether the original decision is wrong [that is to] decide what is the true and correct view." This requires the Presidential member to decide for himself or herself these matters. That does not mean that there must be a de novo hearing in each case. Cases such as Watson, Boston Clothing, Litynski and AGL v Samuels made plain that this was not so under s 36 and the terms of ss 3, 352 (7) and 354 make clear that no such broad ranging factual enquiry afresh is necessarily required. The terms of the WIM Act, ss 3 and 354 and the width of the powers in s 352 (7) make clear that the Presidential member has a wide choice available as to how he or she undertakes the task of deciding for himself or herself what is the true and correct decision. As Allsop P said in Cook v Midpart, error (or lack of it) by the Arbitrator will or may be relevant to the task of the Presidential member, but it does not define the task. There is, however, an important difference in the nature of the tasks of (a) coming to the view that an Arbitrator's view was reasonable and (b) deciding for oneself that the view of the Arbitrator is the true and correct one. In a field where evaluation of injury and evidence of incapacity can lead to different views, both or all which could be reasonably held, it is important that the parties have available to them the skill and judgment of the Presidential member reaching his or her own view on the questions involved in the decision. 58 Just as error of the Arbitrator may be relevant, so might be the advantages of the Arbitrator in seeing witnesses. Nothing we have said, and none of the cases to which we have referred, necessarily requires the Presidential member to rehear the case or to recall all the witnesses. The approach of the Presidential member as to how he or she goes about reaching his or her own decision will be a matter for him or her within the confines and freedoms of s 354. 59 Here, for the reasons we explain by reference to the reasons of the Presidential member, we are of the view that he misdirected himself as to his task and did not undertake the task contemplated by the WIM Act, s 352 (1) and (5).

Decision of Presidential member 60 The Presidential member described his function in the following terms: "23 A Presidential member has a specific and limited role in the review of a decision of an Arbitrator. A review is not a rehearing. The Presidential member is not dealing with the matter de novo and is not arriving at a fresh decision based upon all of the evidence available at a later time ( Coal & Allied Operations Pty Limited v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders' Licensing Board v Sperway Constructions (Sydney) Pty Limited (1976) 135 CLR 616). 24 An Appellant must demonstrate that the decision of the Arbitrator is affected by some legal factual or discretionary error ( Allesch v Maunz (2000) 203 CLR 172; The King Island Company Limited v Deery [2005] NSWWCCPD 1 in order to enliven the Presidential member's power to interfere with the Arbitrator's decision pursuant to s 352(7) of the 1998 Act. Moreover, the error must be such that, but for it, a different decision should have been made (see Snow Confectionary Pty Limited v Askin [2004] NSWWCCPD 56 ("Askin"); s 294 of the 1990 Act; YG & GG Minister for Community Services [2002] NSWCA 247, and Absolon v NSW TAFE [1999] NSWCA 311)." 61 As explained above, this statement of the role of a Presidential member is wrong. This, however, does not end the matter. As occurred in Cook v Midpart at [9]-[10], [58]-[61] it is still necessary to examine whether despite this erroneous statement of approach, the Presidential member did in fact review the matter for himself. 62 Five "Grounds of Appeal" were relied upon by the appellant before the Presidential member. These were: "1. The Arbitrator erred in failing to state the requirement in relation to causation under s 11A WCA. 2. The Arbitrator erred in making no findings of fact that would satisfy any relevant test on causation. 3. The Arbitrator's findings of reasonable action were contaminated by her findings on causation. 4. The Arbitrator's findings of reasonable action were not open on the evidence. 5. The Arbitrator's findings of fact in totality were contaminated by an irrelevant consideration." 63 In relation to the first ground, the Presidential member analysed the reasoning of the Arbitrator and concluded that it would have been preferable had she expressed her findings in the language of s 11A. He expressed his conclusion as follows: "37 The Arbitrator's failure to actually state that the relevant action taken or proposed to be taken by Coles Myer must be "the whole or predominant cause" of Ms Sapina's injury in order for the defence under s 11A of the 1987 Act to succeed, is not determinative on its own. It is insufficient to enable this ground of appeal to succeed on the basis that it is an error that is fatal to the Arbitrator's decision. …" 64 It is clear from his analysis and from the terminology used to express his conclusion that his approach to this ground was restricted to whether or not error had been identified in the approach of the Arbitrator. 65 In relation to the second and third grounds, the Presidential member set out the specific findings by the Arbitrator as to causation and the reasoning on which those findings were based. The Presidential member expressed his conclusions as follows: "65 On a careful consideration of the whole of the evidence, and the Arbitrator's treatment of it, I find that the conclusion to which she came was reasonable and that no error on her part has been established. I have no difficulty in agreeing that her conclusion could have been expressed more clearly and precisely, but Ms Sapina has not demonstrated an error on the part of the Arbitrator, such that she should succeed on this ground of appeal. … 69 Finally the Arbitrator, in considering her work history, found that it was reasonable for Coles Myer to draw the deficiencies in her work to Ms Sapina's attention and to develop a plan to enable her to meet their business expectations. The Arbitrator found that this process and the "actions" were carried out by Coles Myer in a reasonable manner. In terms of Ms Sapina's relationship with her superiors, the Arbitrator was obviously influenced by the opinions expressed by Dr Anderson and the statement of other witnesses. In my view, the "causal link" is established. … 72 Ms Sapina has failed to demonstrate error on the part of the Arbitrator and as a consequence, this ground of appeal fails." 66 It is clear from the way in which the Presidential member approached these grounds of appeal that not only did he regard the identification of error as a precondition to intervention but that is the way in which he performed his function. At no time does he appear to have exercised his own judgment or reached his own conclusions as to the evidence and whether or not it satisfied the s 11A causation test, i.e. whether the appellant's injury was wholly or predominantly caused by reasonable action taken by the employer with respect to performance appraisal. 67 In relation to the fourth and fifth grounds, the Presidential member expressed his conclusion as follows: "82 In all of the circumstances I find that the Arbitrator's finding of reasonable action on the part of Coles Myer is supported by the evidence and the weight of the evidence." … 88 On a consideration of the evidence and other documents that are before me, and in the absence of any further argument or material in support in support from Ms Sapina, no error on the part of the Arbitrator has been demonstrated." 68 As with the first three grounds of appeal the same error is demonstrated, i.e. a failure on the part of the Presidential member to decide for himself whether the Arbitrator's decision was wrong and if so what was the preferred or correct decision. 69 We appreciate the difficulty confronting the Presidential member in this case. The grounds of appeal and the submissions by both sides were expressed in such a way as to invite the approach adopted by the Presidential member of restricting his consideration to whether or not error in the decision of the Arbitrator had been demonstrated. As we have indicated above, such an approach may well be useful and relevant but it is not a precondition for nor does it excuse the failure on the part of a Presidential member to reach his or her own conclusion on the evidence as to the matters which were in issue before the Arbitrator. 70 The failure of a Presidential member to properly exercise his or her function under the WIM Act, s 352 constitutes an error of law. This error arises in all three grounds of appeal. It follows that the appellant has made out her grounds of appeal and the appeal should be allowed. Given the basis upon which the appeal has succeeded, the matter must be remitted to a Presidential member to be determined in accordance with these reasons. 71 We would propose the following orders:

2. The orders of Acting President Byron be set aside.

3. Remit the proceedings to the Workers Compensation Commission constituted by a Presidential member to be dealt with according to law.

4. The respondent pay the appellant's costs of the appeal. 72 BEAZLEY JA: I agree with Allsop P and Hoeben J. **********

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