Skates v Hills Industries Ltd

Court of Appeal (NSW)|2021-02-25|Before: Basten JA, Leeming JA, McCallum JA, Adamson J

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

HEADNOTE [This headnote is not to be read as part of the judgment] The applicant sought leave to appeal from a judgment of the Supreme Court reviewing a decision of the Appeal Panel of the Workers Compensation Commission determining a medical dispute as to the degree of permanent impairment resulting from certain injuries. The issue sought to be raised by the proposed appeal was whether the approved medical specialist (AMS) to whom the medical dispute was initially referred was confined to an assessment of the "body parts" specified in the referral form completed by a delegate of the Registrar of the Workers Compensation Commission. The applicant had suffered a serious wrist fracture and injury to the left ring finger when he fell off a ladder during the course of his employment as an electrician. A medical dispute as to the degree of permanent impairment resulting from those injuries was referred by the Registrar of the Workers Compensation Commission to an approved medical specialist who concluded that the applicant's left upper extremity (left arm) had become functionally useless and assessed whole person impairment of 61%. An appeal brought by the insurer to the Appeal Panel was upheld on the basis that the AMS had erred by going outside the terms of the Registrar's referral and assessing body parts not referred to him. The referral form completed by the Registrar's delegate specified "body part/s referred" as "Left Upper Extremity (joint ring finger), scarring (TEMSKI)". The insurer conceded that the referral should also have included reference to the left wrist but the Appeal Panel did not give effect to that concession, considering itself bound by the terms of the referral. The Appeal Panel revoked the certificate and issued a new certificate assessing whole person impairment of 7% based on assessment of the "body part or system" listed as "left upper extremity (joint ring finger)" and scarring only. Mr Skates sought judicial review of that decision in the Supreme Court of New South Wales. The primary judge upheld the application on the limited basis that the Appeal Panel should have given effect to the insurer's concession as to inclusion of the wrist but otherwise upheld the decision of the Appeal Panel that the AMS was bound by the terms of the referral and that he had exceeded the referral by assessing impairment in parts of the upper limb other than the wrist and the ring finger. Mr Skates sought leave to appeal from that decision. Held, granting leave to appeal for a limited purpose but otherwise dismissing the application for leave to appeal (by Basten JA and Leeming JA, McCallum JA dissenting): by Basten JA and Leeming JA: 1 The primary judge was correct in finding that the Appeal Panel (subject to the identified concession) was correct in concluding that the approved medical specialist's assessment contained demonstrable error in failing to be limited to the terms of the applicant's referral of a dispute: [30]; [43]. 2 The applicant's "application to resolve a dispute" of 8 August 2017, together with the accompanying medical reports, identified a dispute concerning the degree of permanent impairment caused by the injury to the applicant's left wrist, ring finger and scarring. The purpose of the statutory regime was to resolve the medical dispute identified by the parties' competing claims. The medical assessment was limited to the dispute so identified: [27]-[30]; [45]-[48]. 3 There were numerous opportunities for both parties to raise the issues now the subject of ongoing disputation in the courts. The fact that neither party did so in a relatively small claim would provide a sound reason for refusing leave to appeal even if error had been demonstrated on the part of the primary judge: [36]; [43]. by McCallum JA (dissenting): 4 The primary judge erred in holding that the approved medical specialist was not entitled to assess the degree of impairment of the whole of the left upper limb. The dispute referred had to be the dispute raised. Properly read, the application lodged by the applicant in the present case sought resolution by the Commission of a medical dispute as to the degree of permanent impairment in the body parts and systems specified in part 5.6 of the application form, which included the left upper extremity: [69], [82]-[83]. 5 The combination of the manner in which the claim had been conducted on behalf of the applicant and the quantum involved did not warrant the refusal of leave. While the sum involved was small by reference to the limit for an appeal as of right or the quantum of other claims the Court is accustomed to determining, it could not be assumed that its significance was small to the injured worker: [84].

Judgment

BASTEN JA: The applicant, Anthony Skates, has a long outstanding application for a lump sum payment under the Workers Compensation Act 1987 (NSW). The claim concerns an injury to his left arm which occurred on 7 June 2013. The present application for leave to appeal seeks to challenge a judgment in the Common Law Division in a proceeding brought by the applicant for judicial review of a medical assessment by an Appeal Panel in the Workers Compensation Commission. For the reasons set out below, subject to the addition of an order which appears to have been overlooked, leave should be refused.

Background

It is necessary to recount the procedural background in a little detail because it was littered with missteps and missed opportunities to correct errors in a case in which in 2017 the insurer had offered a sum only $9,900 below the claim. These facts of themselves provide a powerful reason to refuse leave to appeal.
By an application to the Workers Compensation Commission filed on 8 August 2017 the applicant sought a payment of $26,950 on the basis of a whole person impairment of 18%, under s 66 of the Workers Compensation Act. Although there was a referral to an approved medical specialist (AMS) for assessment, the medical specialist (Dr Frank Machart) declined to make an assessment on the basis that, in his opinion, the applicant was suffering from a condition known as "complex regional pain syndrome" (CRPS), diagnosis of which required that the condition be present for more than 12 months and be verified by more than one examining physician. Although the specialist certified that the applicant's impairment was permanent and fully ascertainable, he deferred completing the assessment to allow the condition to be reviewed 12 months later.
It may be that the degree of permanent impairment was not in fact fully ascertainable at that time, otherwise it is unclear on what basis the specialist could decline to make the assessment: cf Workplace Injury Management and Worker's Compensation Act 1998 (NSW) (Workplace Injury Act), s 322(4).
Nothing then happened until the applicant's solicitors requested that "the proceedings be restored" by letter to the Commission dated 24 January 2019. On 13 March 2019 the application was again referred to Dr Machart. He assessed the condition of the applicant's upper left extremity (his left arm) as involving a whole person impairment of 60%. Together with an unchallenged allowance for scarring, the total impairment was 61%.
On 5 June 2019 the employer's insurer lodged an appeal. The matter was then referred to an appeal panel which, by a certificate dated 27 September 2019, set aside the decision of Dr Machart and reassessed the whole person impairment at 7%. That figure being below the statutory threshold of 10%, the applicant was not entitled to any payment on account of permanent impairment. On 1 November 2019 an arbitrator issued a certificate of determination to that effect.
By summons filed on 20 December 2019 the applicant sought judicial review in the Common Law Division of the decision of the Appeal Panel. There was no attempt at that stage to challenge the decision of the arbitrator. That omission apparently led the insurer to file a cross-summons challenging the validity of the certificate issued by the AMS. However, on 3 April 2020 the solicitors for the applicant attempted to rectify their omission by filing an amended summons, some three months before the matter was fixed for hearing. The document was rejected on the basis that leave was required and had not been sought. On 11 June a notice of motion was filed in support of an application to amend the summons and a copy of the proposed amended summons was apparently filed on 18 June 2020. The matter was heard on 25 June 2020, on the basis of an amended summons.
On 30 June 2020, with commendable efficiency, Adamson J made orders setting aside the decision of the Appeal Panel of 27 September 2019 and remitting the matter to the Registrar, Workers Compensation Commission. [1]

Proceedings in this Court

On 1 October 2020 a summons seeking leave to appeal was filed in this Court. The summons stated that a notice of intention to appeal had been filed and served on 28 July 2020. Accordingly the summons should have been served on or prior to 30 September 2020. A brief extension of time was required.
Leave was required because the amount in issue on the appeal was well under the threshold of $100,000 fixed by the Supreme Court Act 1970 (NSW), s 101(2)(r), for an appeal as of right. As noted above, the amount of the claim, as formulated in 2017, was $26,950. Although that fact may not be determinative of the amount in issue, it may demonstrate why at almost every key point in the history of this matter mistakes have been made by almost everyone involved.
The draft notice of appeal accompanying the summons was defective. It sought an order allowing the appeal and setting aside the judgment of the Court below. However, so far as it went, that judgment was entirely favourable to the applicant. It set aside the decision of the Appeal Panel, remitted the matter to the Registrar, and ordered that the employer pay the applicant's costs of the proceedings. When this was pointed out in the course of argument, counsel for the applicant sought leave to file an amended notice of appeal. Although the amended draft sought to set aside only order (2) of the judgment below (namely remittal to the Registrar) the amendment also sought an order in identical terms.
The only variation sought to the orders made by the primary judge was an order seeking to set aside the decision of the arbitrator dated 1 November 2019. That order had been sought in the belated amendment to the summons before the primary judge and followed, logically, from the setting aside of the decision of the Appeal Panel. It is not clear why the order was not made, but it was almost certainly a matter which could have been rectified under the slip rule. That course was not adopted. Although the respondent resisted an extension of time, a grant of leave and ultimately any orders being made on the appeal other than its dismissal, it ultimately took no objection to this Court making the missing order.

Issues on the proposed appeal

With those preliminary matters out of the way, it is necessary to identify the real reason why the applicant seeks to appeal from the judgment in the Division. The answer lies in the preliminary assessment (to use a non-statutory term) made by Dr Machart in 2017, namely that the applicant's left arm was afflicted by CRPS which rendered it useless, justifying a whole person impairment assessed at 61%. The primary judge did not set the decision of the Appeal Panel aside on the basis that such an assessment was available; rather it was set aside on the basis that the Appeal Panel failed to assess the injury to the applicant's left wrist, an omission from the referral which the insurer had conceded was an error. Whether the Panel was correct to reject the assessment by the AMS turned on both the proper construction of the referral for assessment, and the power of the Registrar to limit the scope of the assessment by the form and content of the referral.
In order to resolve that dispute it would have been desirable, in the event, for the applicant to seek appropriate declarations. A declaration to that effect was not sought in the proceedings below, nor in this Court. However, that difficulty may be put to one side because, for reasons which will be explained, the applicant was not entitled to maintain such a claim.

Identifying the issue under the statutory scheme

As has been noted, the present stage in the proceedings commenced on 8 August 2017 when Mr Skates referred a dispute about lump sum compensation under s 288 of the Workplace Injury Act. Medical assessments are dealt with under Ch 7, Pt 7 of the Act. A "medical dispute" is defined in the following terms: 319 Definitions In this Act: … medical dispute means a dispute between a claimant and the person on whom a claim is made about any of the following matters or a question about any of the following matters in connection with a claim: (a) the worker's condition (including the worker's prognosis, the aetiology of the condition, and the treatment proposed or provided), (b) the worker's fitness for employment, (c) the degree of permanent impairment of the worker as a result of an injury, (d) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, and the extent of that proportion, (e) the nature and extent of loss of hearing suffered by a worker, (f) whether impairment is permanent, (g) whether the degree of permanent impairment of the injured worker is fully ascertainable.
A medical dispute may be referred for assessment by the Registrar of the Commission, to an AMS: s 321.
This was, at least, a "medical dispute" within the meaning of par (c) of the definition of that term in s 319 because it was a claim about "the degree of permanent impairment of the worker as the result of an injury". In fact the referral by the Registrar on 1 September 2017 invoked pars (c), (d), (f) and (g) of the definition in s 319. The elements of the definition are not entirely independent. Each is a matter which can be assessed by an AMS, pursuant to s 322 and s 323. The various elements in the definition of "medical dispute" are identified as "matters" and the medical specialist is to give a certificate (a medical assessment certificate) "as to the matters referred for assessment": s 325(1).
The function of the AMS is conditioned by s 322, which relevantly provided (in September 2017): 322 Assessment of impairment (1) The assessment of the degree of permanent impairment of an injured worker for the purposes of the Workers Compensation Acts is to be made in accordance with Workers Compensation Guidelines (as in force at the time the assessment is made) issued for that purpose. … (4) An approved medical specialist may decline to make an assessment of the degree of permanent impairment of an injured worker until the approved medical specialist is satisfied that the impairment is permanent and that the degree of permanent impairment is fully ascertainable. There is further provision made with respect to the Guidelines: 331 Guidelines Medical assessments, appeals and further assessments under this Part are subject to relevant provisions of the Workers Compensation Guidelines relating to the procedures for the referral of matters for assessment or appeal, the procedure on appeals and the procedure for assessments.
Pursuant to s 376, the State Insurance Regulatory Authority is empowered to issue guidelines with respect to the assessment of the degree of permanent impairment: s 376(1)(a). Section 377 requires that the guidelines be developed "in consultation with relevant medical colleges". The guidelines are subject to the requirements of the Interpretation Act 1987 (NSW) with respect to notice and disallowance of statutory rules: Workplace Injury Act, s 377(3).
If the Registrar is satisfied that a medical assessment certificate contains "an obvious error" the Registrar may issue or approve the issue of a replacement certificate: s 325(3). That step was not taken in the present case. Each of the "matters" relating to permanent impairment identified in the definition of medical dispute in s 319 is repeated in s 326(1) as a matter as to which the certificate constitutes conclusive evidence. Any of those matters may be the subject of an appeal under s 327(1) and (2). The grounds of appeal include "deterioration of the worker's condition that results in an increase in the degree of permanent impairment": s 327(3)(a), and the availability of additional relevant information: s 327(3)(b). Otherwise, the only grounds are that the assessment was made "on the basis of incorrect criteria", or contained "a demonstrable error": s 327(3) (c) and (d).
The assessment the subject of the appeal in this case was Dr Machart's assessment of 15 May 2019. The insurer's appeal invoked the grounds in pars (c) and (d). At that stage, an application for an appeal was made to the Registrar (it is now made to the President); the appeal could not proceed unless the Registrar was satisfied that at least one of the grounds for appeal had been made out: s 327(4). The Registrar was so satisfied and the matter was duly referred to an appeal panel. It is then necessary to consider the grounds on which the appeal proceeded.

Grounds of appeal to appeal panel

The relevant ground of appeal was identified by the insurer in the submissions accompanying the application to appeal, in the following terms: "3.2 Ground 1 Assessing body parts not referred (a) The Respondent made a claim on the appellant with respect to injury on 7 June 2013 to his left wrist, ring finger and scarring. The Appellant accepted liability for injury to the left wrist, ring finger and scarring. [The submissions then set out the offer and counter-offer with respect to those injuries.] … (d) The AMS referral only referred the claim to the AMS for assessment of the left upper extremity (joint ring finger) and scarring. There was no objection by the Appellant or Respondent to the referral. (e) The Appellant accepts there was an error in the body parts identified in the AMS referral and submits the body parts referred should have been the accepted body parts pleaded at Part 4 of the [application to resolve dispute], left wrist, ring finger and scarring and as identified in the AMS referral dated 21 September 2017. … (g) The Appellant submits the AMS erred in assessing impairment of restriction of the left shoulder, left elbow, left thumb, index, middle and little fingers and his assessment of those body parts is a demonstrable error."
The Appeal Panel, in its decision of 27 September 2019, accepted that, as set out in the reasons for assessment, the AMS had relied upon "[t]he severity of the diminished movement in the whole arm, shoulder, elbow, wrist, and fingers". [2] The Appeal Panel accepted that that involved error in that it was "settled law that an AMS is confined by the terms of the referral." [3]
The relevant parts of the referral by a delegate of the Registrar read as follows: "1. Medical dispute referred for assessment (s 319 1998 Act) • the degree of permanent impairment of the worker as a result of an injury (s 319(c)) • whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, and the extent of that proportion (s 319(d)) • whether impairment is permanent (s 319(f)) • whether the degree of permanent impairment of the injured worker is fully ascertainable (s 319(g)) Date of injury: 7 June 2013 Body part/s referred: Left Upper Extremity (joint ring finger), Scarring (TEMSKI) [4] Method of assessment: Whole Person Impairment."

Applicant's case on review

Briefly stated, the applicant's case was that the scope of the referral was identified by reference to the matters generically stated by reference to the paragraphs in s 319 which, it was submitted, were not, and could not be, restricted by the non-statutory reference to "body parts". This approach, it was submitted, did not challenge the proposition that the scope of the referral to the AMS was limited by the terms of the referral: it was merely a question of the proper understanding of the referral itself.
This submission should be rejected on two grounds, one of which may be briefly stated, the other of which requires a more extensive analysis of the legislative scheme for such claims.
The short explanation is that the jurisdiction of the Commission in relation to a claim for lump sum compensation under s 66 of the Workers Compensation Act was not at large. The claim was made with respect to a specific injury which occurred in the course of employment on a specified date. The form for an application to resolve a dispute required identification of the date of the injury, a description of the injury, and a description of how the injury occurred. The "injury details" included in the applicant's application of 8 August 2017 were as follows: "Date of injury: 7.6.2013 Place of injury: Wagga Wagga Date of compensation claim: 7.6.2013 Injury description: Injury to left wrist, ring finger and scarring. Describe how injury occurred: The applicant fell from a ladder whilst accessing a roof to complete a pay TV installation severely injuring his left wrist and ring finger."
In part 5.6 of the form, which covered permanent impairment, in addition to the date of the injury, the applicant was asked to identify the "body parts/systems claimed" using "correct terminology depending on date of injury". In that column, he included the following statement: "Left upper extremity, joint ring finger and scarring". This description, it is true, was not in precisely the terms set out earlier in the application.
Medical reports enclosed with the application referred to specific injuries of the left wrist and hand; it was these injuries to which the insurer admitted liability and as to which a dispute arose concerning the precise extent of the injury. The insurer offered to accept a degree of permanent impairment calculated at 12%; the applicant sought a payment calculated by reference to 18%. These figures were supported by medical reports.
As the primary judge found, this material defined the proper scope of the referral. However, the referral by the Registrar omitted reference to the left wrist. The insurer accepted that this was an error, as was noted by the Appeal Panel. However, the Appeal Panel did not see fit to include an assessment of the wrist injury in its review. The trial judge held that it should have done and that was the basis on which she set aside its decision.
It was not entirely clear whether the applicant's case demanded that no constraint be placed on the assessment to be undertaken by reference to body parts/systems. If that were so, the AMS would not have been restricted to the left upper extremity (the left arm). No one suggested that he was not confined to that extent. However, once it is accepted that the scope of the referral was properly capable of restriction by reference to body parts/systems, the question as to how the Appeal Panel read the referral may well have been a matter for its professional judgment and not one involving reviewable error. In any event it was not submitted that it misread the referral. However, the claim was in fact wider than the referral in that it extended to the left wrist.
More broadly, this approach is confirmed by having regard to the statutory scheme, a matter which was fully developed by the primary judge in her reasons. Critically for present purposes, the concept of "whole person impairment" is itself not found in the Workplace Injury Act, which, reflecting s 66 of the Workers Compensation Act, uses the term "permanent impairment". As set out above, s 322 of the Workplace Injury Act requires that an assessment of the degree of permanent impairment "is to be made in accordance with Workers Compensation Guidelines (as in force at the time the assessment is made) issued for that purpose." Section 331, dealing with the promulgation of Guidelines has also been noted.
Without attempting to set out the detail of the Guidelines and the AMA Guides, to which the Court was not taken, it is sufficient to note that the medical assessment certificate was required to identify the specific body part or system, together with the "chapter, page and paragraph number in WorkCover Guides" and the "chapter, page, paragraph, figure and table numbers in AMA 5 Guides". Identification of the extent of impairment by reference to individual body parts and body systems is required by the Guidelines and Guides which the statute obliges the AMS to follow.
Chapter 2 of the Guidelines deals with the "upper extremity". Reference is consistently made to "AMA 5" being the fifth edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment. Appointment as an AMS under the Workplace Injury Act is subject to specified criteria developed by the Minister, and the Authority is empowered to arrange for "the provision of training and information … to promote accurate and consistent assessments under this Part": s 320(4).
Further, it is apparent that the referral by the Registrar was in a standard form, as was the application to resolve a dispute. There was no suggestion that these forms were not in appropriate terms. It follows that the primary judge was correct in finding that the Appeal Panel (subject to the identified concession which it was held should have been taken into account in assessing the claim) was correct in concluding that Dr Machart's assessment contained demonstrable error in failing to be limited to the terms of the claim.

Conclusions

The failure of both parties to raise with the Registrar the error in excluding the left wrist is inexplicable. The error first occurred in the referral dated 1 September 2017. The referral made in 2019 identified the date of the request as 13 March 2017 (when it should have been 13 March 2019), but thereafter contained the same error. Indeed, the only variation to the earlier referral was the inclusion of the certificate granted on 13 October 2017 and two subsequent documents. Further, the earlier medical assessment certificate contained the same assessment of severely diminished movement in the elbow and shoulder and in other fingers to which objection was taken when those assessments appeared in the further certificate issued on 15 May 2019. In short, there were numerous opportunities for both parties to raise the issues which have now become the subject of ongoing disputation in the courts. The fact that neither party did so in what is a relatively small claim, would provide a sound reason for refusing leave to appeal even if error had been demonstrated on the part of the primary judge which, in my view, it has not. It has not been necessary to repeat the reasoning of the primary judge in full, but it provides further arguments in support of these conclusions.
This case does not raise an issue as to whether, and if so how, a deterioration in the worker's condition can be accommodated in an application for a lump sum payment.
Leave should be granted for two limited purposes. The first is to make an order setting aside the decision of the arbitrator, so as to permit further steps to be taken in the Commission. The second is to remit the matter with a direction that any further referral to be made to an AMS should identify the left wrist as an affected body part. That is appropriate because it is likely that the Appeal Panel took a stricter view of its function, which did not allow it to extend the scope of the assessment required by the Registrar's referral, even with consent of both parties. It is not necessary to determine whether it was correct in that regard, because there is no challenge to the primary judge's finding that led to the setting aside of its decision. However, the Registrar's referral did not cover the full extent of the dispute.
On the assumption that no step has yet been taken in the Commission following the judgment of the primary judge, it is necessary to note that the institutional arrangements have changed since the primary judge's orders. (If some further step has been taken, the parties should advise the Court within 14 days so that the orders proposed below can be varied.) On 1 March 2021, the Workers Compensation Commission was replaced by the Personal Injury Commission. [5] On the same day, s 327 of the Workplace Injury Act was amended so that the functions formerly undertaken by the Registrar of the Workers Compensation Commission are now vested in the President of the Personal Injury Commission of New South Wales. [6] The transitional provisions in Sch 1 to the Personal Injury Commission Act apply: 14C Pending court proceedings (1) This clause applies in relation to pending proceedings before a court - (a) on an appeal against, or for the judicial or other review of, a decision of an original decision-maker in pre-establishment proceedings, … (2) The court may, on and from the establishment day, continue to deal with the proceedings until they are completed. (3) The following provisions apply to the completion of proceedings under this clause - (a) the court continues to have and may exercise all the functions that the court had in relation to the proceedings immediately before the establishment day, (b) the provisions of any Act, statutory rule or other law that would have applied to or in respect of the proceedings had this Act not been enacted continue to apply. (4) Without limiting subclause (3), if the original powers of the court included the power to remit the proceedings to be heard and decided again by the original decision-maker, the court may, in determining the proceedings - (a) remit the proceedings instead to the new decision-maker, and (b) make any other orders it considers appropriate to facilitate the remitting of the proceedings to the new decision-maker.
The remittal should therefore be directed to the "new decision-maker", who is the President. The proposed direction may be made pursuant to the power in cl 14C(4)(b). The former Registrar properly submitted to the jurisdiction of the Court (except as to costs); it may be assumed that the President will adopt the same role. However, he will be notified of this judgment and if he wishes to be heard in relation to the variation in the orders made by the primary judge, he will be accorded that opportunity. To allow that opportunity, the orders should not be entered for 14 days, so as to allow a period of 28 days in which to seek a variation of the orders, subject to earlier entry of the orders if the President indicates at an earlier point that he does not wish to be heard.
Given the many opportunities for either party to have avoided this litigation, I would require each party to bear its own costs in this Court.
I propose the following orders: 1. Grant leave to appeal for the purpose of making the following orders: 1. set aside the decision of the Arbitrator made on 1 November 2019; 2. direct that the President, in determining the terms of any referral for a further medical assessment, include the left wrist as a body part to be assessed. 1. Otherwise dismiss the application for leave to appeal. 2. Direct that there be no order as to the costs of the application for leave to appeal. 3. Direct that these orders not be entered until 14 days from 14 July 2021.
LEEMING JA: I agree with the reasons of Basten JA and the orders he proposes. I would add the following by way of emphasis, in light of the different approach adopted by McCallum JA.
The starting point is a "medical dispute". That term is defined in s 319 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW), reproduced in the other judgments. The term is defined by reference to the existence of a "dispute between a claimant and the person on whom a claim is made" about any of seven related subject matters including the degree of permanent impairment as a result of an injury, whether the impairment is permanent, whether it is partly due to a previous injury or pre-existing condition and whether it is fully ascertainable. It may be expected that as a consequence of the ordinary operation of the regime at least in most cases the dispute will have been identified by a written exchange of competing claims.
In the present case Mr Skates' "Application to Resolve a Dispute" was received by the Commission on 8 August 2017. It described his injury as "Injury to left wrist, ring finger and scarring" and stated that he had a permanent impairment of 18% by reference to "Left upper extremity, joint ring finger and scarring". A medical report accompanying Mr Skates' application from Dr O'Keefe stated that the whole person impairment had been assessed according to the "new WorkCover 4 guidelines", and that insofar as it was based on his "left upper extremity" it comprised impairment to the wrist and ring finger by reference to particular figures in the AMA5 Guide. Mr Skates' application also included a letter from the workers compensation insurer dated 11 July 2017. The letter referred to the claim and Dr O'Keefe's assessment of whole person impairment of 18% based on "Left upper limb (wrist, ring finger) 15% WPI", "Scarring 3% WPI". The letter stated that it had arranged for Mr Skates to be examined by Dr Panjratan, whose assessment was "Left upper limb (wrist, ring finger) 11% WPI" and "Scarring 1% WPI" yielding a total of 12% WPI, and it made a settlement offer on that basis.
The dispute between Mr Skates and the insurer was crystallised by the correspondence attached to Mr Skates' application; indeed, it was why the documents setting out both sides' claims were attached. That was the dispute which was referred to the Commission pursuant to s 288. It was a "medical dispute" because the parties had made different claims about the degree of permanent impairment suffered by Mr Skates as a result of the injury. It was therefore apt to be referred for medical assessment. The point of doing so was to resolve the dispute.
Sections 321 and 321A concern referrals of a dispute for assessment. The language of the heading of each section commences "Referral of medical dispute" and each provision confirms that it is the medical dispute which is referred for assessment. Section 293 authorises the referral of a medical dispute for medical assessment and the deferral of determination of the dispute. All these provisions proceed on the basis that the outcome of the assessment is the resolution of the medical dispute. So too does the conclusive presumption of correctness accorded by s 326 to assessments which are certified in a medical assessment certificate.
The paperwork associated with the administration of the legislation seems to have led to a tendency to give to the document comprising the "referral" to an Approved Medical Specialist a greater status than it warrants. The document is important. However, the fundamental legal concept is a dispute. In the absence of a dispute, the worker and the insurer would not need to go to the Commission. An important category of disputes is medical disputes, and the referral of the medical dispute to an Approved Medical Specialist is but an aspect of the statutory scheme to resolve the dispute.
The document signed by the Registrar's delegate and dated 1 September 2017 described itself as a "Referral for Assessment of Permanent Impairment to Approved Medical Specialist". Its first numbered subheading was "Medical Dispute Referred for Assessment" and there it stated, wrongly, "Body part/s referred: Left Upper Extremity (joint ring finger), Scarring (TEMSKI)". That was wrong insofar as it did not include Mr Skates' wrist. The later referral contained the same poor language and contained additional errors. But the infelicity of parts of the covering document cannot stand in the way of the fact that it was the dispute between the parties, crystallised in the documents attached to that covering document, which was referred for assessment in accordance with the statute. The Appeal Panel was correct to state that the Approved Medical Specialist had gone beyond assessment of the medical dispute which had been referred to him.
The foregoing substantially corresponds with the first explanation given by Basten JA for confirming the correctness of the result reached by the Appeal Panel and the primary judge, with a heavier emphasis upon the purpose of the statutory regime being to resolve a medical dispute and that a dispute is identified by the disputants' competing claims.
McCALLUM JA: The applicant seeks leave to appeal from a decision of the Supreme Court (Adamson J) concerning the determination of his entitlement to compensation for permanent impairment resulting from injuries he sustained when he fell off a ladder at work. The proposed appeal raises a narrow but important question concerning the scope of the medical assessment that was permitted to be undertaken by an approved medical specialist to whom a medical dispute was referred by the Registrar of the Workers Compensation Commission under the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the 1998 Act). The question is whether the medical specialist was confined to an assessment of the "body part/s referred" by a delegate of the Registrar. In my view, the answer is that he was not. The task for the medical specialist was to assess permanent impairment, not body parts.
The insurer contended that the summons for leave to appeal was filed out of time by one day. That is not the case. The insurer's contention assumed that the summons was required to be filed on or before 30 September 2020. Incidentally, Mr Skates asserts that the summons was filed electronically on that date but marked by the court as having been filed the following day. In any event, even if the summons was not filed until 1 October 2020, it was within time. The primary judgment was given on 30 June 2020 and accordingly that was the "material date" as defined in r 51.2 of the Uniform Civil Procedure Rules 2005 (NSW). As the applicant filed a notice of intention to appeal within 28 days of that date, the summons for leave to appeal was required to be filed "within 3 months of" the material date: r 51.9(1)(a). In reckoning that period of time, the material date is not to be counted: r 1.11(2). Accordingly, the summons filed on 1 October was filed within 3 months of the material date.

Circumstances in which the question arises

The applicant, Anthony Skates, was injured on 7 June 2013 when he fell off a ladder during the course of his employment as an electrician. He landed on his outstretched left hand and suffered a serious wrist fracture and injury to the left ring finger. The injury to the wrist required numerous surgical procedures as a result of which Mr Skates was also left with scarring. Following the receipt of competing assessments by two orthopaedic surgeons as to the degree of whole person impairment resulting from those injuries, Mr Skates lodged an "application to resolve a dispute" with the Workers Compensation Commission.
The application was prepared using a standard form described on its face as the approved form for an application of that kind. Part 1 of the form is headed "Matters in Dispute". Under that heading, Mr Skates specified, as the matter for referral for medical assessment, "Lump sum compensation where degree of permanent impairment in dispute". Part 4 of the form is headed "Injury Details". Under that heading, Mr Skates specified "injury to left wrist, ring finger and scarring" as the relevant injuries. Those injuries were not disputed by the insurer.
Part 5 of the form is headed "Claim details". Mr Skates completed only part 5.6 of that part which appears under the heading "Permanent impairment including pain and suffering". The form contains a table which Mr Skates completed as set out below: Permanent Impairment Claim under Table of Disabilities or Whole Person Impairment (WPI) Percentage Amount claimed Use correct terminology depending on date of injury Date of Injury Body Parts/Systems Claimed 7.6.2013 Left upper extremity, joint ring finger and scarring 18% $26,950.00 Pain and suffering: % $

It may be noted that the form requires an applicant to specify the "body parts" or "body systems" that are "claimed". In that respect, the form does not reflect the language of the legislation, which contains no reference to "body parts". It will be necessary to return to that issue. In any event, it is clear from the manner in which the form was completed that Mr Skates was claiming to have suffered workplace injuries to his left wrist and his left ring finger with consequential scarring and that he sought compensation for permanent impairment resulting from those injuries affecting the following "body parts/systems": the left upper extremity, the joint of the ring finger and scarring. The form makes no sense unless the words "body parts/systems claimed" are understood as shorthand for the body parts or body systems in respect of which permanent impairment compensation is claimed.
The Registrar referred the medical dispute to an approved medical specialist, Dr Machart, for medical assessment, as contemplated by s 293 of the 1998 Act (that section now provides for a dispute to be referred by the President of the new Personal Injury Commission but at the time Mr Skates' application was referred, the section provided for referral by the Registrar of the Workers Compensation Commission). Dr Machart initially concluded that whole person impairment could not yet be assessed as Mr Skates was presenting with indications of complex regional pain syndrome which had not been evident to other assessors. He certified accordingly. Section 322(4) of the 1998 Act contemplates that proceedings will be adjourned in that circumstance.
In due course, the proceedings were restored for further medical assessment. The medical dispute was again referred to Dr Machart. On 15 May 2019, he issued a medical assessment certificate assessing Mr Skates as suffering from 60% whole person impairment. The reason the impairment was so substantial at that stage was that Dr Machart assessed Mr Skates to have presented with an "essentially useless left limb" as a result of a combination of impairments to the shoulder, elbow and other fingers and thumb including complex regional pain syndrome "now affecting the whole upper limb".
The insurer appealed to the Appeal Panel of the Commission. The principal ground for the appeal was the contention that Dr Machart had erred in assessing body parts that were not referred to him. The referral form completed by the delegate of the Registrar specified "body part/s referred" as "Left Upper Extremity (joint ring finger), scarring (TEMSKI)". The effect of that wording was to nominate the left upper limb (the arm) as the relevant body part but to confine the reference to the ring finger and to exclude the wrist. The insurer accepted that there was a mistake in that the referral should have included the wrist. However, the insurer contended that the inclusion in Dr Machart's assessment of impairment in other parts of the left upper limb amounted to demonstrable error.
The Appeal Panel did not act on the insurer's concession that the wrist should have been included. The Panel otherwise accepted the insurer's contentions. By certificate dated 27 September 2019, it revoked Dr Machart's certificate and issued a new certificate assessing whole person impairment of 7% based on assessment of the "body part or system" listed as "left upper extremity (joint ring finger)" and scarring only. In its reasons for decision, the Appeal Panel explained "it is settled law that an approved medical specialist is confined by the terms of the referral".
If that were the law, the injustice it would visit upon the applicant in the present case is manifest. There can be only one assessment of the degree of permanent impairment that results from an injury (or collection of injuries arising from a single incident): s 322A of the 1998 Act. The ring finger and the scarring were very much the minor injuries suffered by Mr Skates. Unsurprisingly, they did not give rise to a degree of permanent impairment that met the threshold for lump sum compensation. The application of that analysis would not meet the objective of providing fair compensation for workplace injuries. However, as I will explain, that is not the law.
On 1 November 2019, on the strength of the Appeal Panel's new certificate, an Arbitrator of the Commission certified his determination that Mr Skates suffers 7% permanent impairment resulting from the injury on 7 June 2013 and that he has no entitlement to lump sum compensation.
Mr Skates sought judicial review of the decision of the Appeal Panel in the Supreme Court of New South Wales. The amended summons filed on 18 June 2020 sought an order setting aside both the decision of the Appeal Panel made on 27 September 2019 and the decision of the Arbitrator made on 1 November 2019.
The application was successful but not on the issue that was most important to Mr Skates. The primary judge (Adamson J) held that the Appeal Panel was in error in not giving effect to the insurer's concession that the left wrist ought to have been included in the referral to Dr Machart. However, her Honour held that the Appeal Panel was correct to determine that Dr Machart had gone beyond the terms of the referral in assessing parts of the upper limb other than the wrist and the ring finger: Skates v Hills Industries Ltd [2020] NSWSC 837 at [71]. The primary judge made the following orders: (1) Set aside the decision of [the Appeal Panel] made on 27 September 2019. (2) Remit the matter to [the Registrar] to be determined in accordance with law. (3) Dismiss the cross-summons. (4) Subject to order (4) below, order the first defendant to pay the plaintiff's costs of the proceedings. (5) Order the parties to bear their own costs of the cross-summons.
The primary judge did not make the further order sought in the amended summons to have the decision of the Arbitrator made on 1 November 2019 set aside.

Application in this court

Mr Skates seeks leave to appeal from the decision of Adamson J. He contends that Dr Machart was entitled to assess all of the impairment of the left upper limb resulting from the accepted injuries to the wrist, ring finger and scarring.
The application for leave to appeal as initially framed sought an order setting aside "the judgment of the court below", notwithstanding the fact that the orders made by the primary judge reflected victory (albeit Pyrrhic) for Mr Skates. It is trite that appeals lie from orders, not reasons. There is no right of appeal against the reasons given for a correct result. However, it does not follow that the present appeal (if leave is granted) is incompetent. The operative decision of which Mr Skates sought review in the Supreme Court was the Arbitrator's determination of the dispute certified on 1 November 2019. As already noted, Mr Skates sought an order in the judicial review proceedings setting aside that decision but the primary judge did not make that order. That was probably due to oversight and no doubt could have been addressed under the slip rule but the fact is that the Commission's decision determining the dispute unfavourably to Mr Skates still stands. In circumstances where the parties had not attended to those complexities in advance of the hearing of the present appeal and came to Court ready to argue the substantive issue sought to be raised by Mr Skates, the Court invited Mr Skates to provide an amended draft notice of appeal directed to commencing a properly constituted appeal.
The amended draft notice of appeal seeks the following relief: (1) Appeal allowed. (2) Order 2 of Judgment of the court below be set aside. (3) Orders 1, 3, 4 and 5 of the Court below confirmed. (4) An order that the matter is remitted to [the Registrar] to determine the matter in accordance with the law as stated by this Court. (5) An order setting aside the decision of [the Arbitrator] dated 1 November 2019. (7) The First Respondent pay the appellant's costs.
I have concluded that the primary judge erred in holding that the approved medical specialist was not entitled to assess the degree of impairment of the whole of the left upper limb and went beyond the jurisdiction conferred on him by the referral. In my respectful opinion, the certificate of the Appeal Panel was vitiated by error and Arbitrator's determination dated 1 November 2019 should have been set aside for that reason. My reasons for that conclusion are as follows.

Relevant provisions concerning compensation for permanent impairment

Workers compensation is governed by the Workers Compensation Act 1987 (NSW) (the 1987 Act) and the 1998 Act. The 1987 Act is to be construed with, and as if it formed part of, the 1998 Act: s 2A(2) of the 1987 Act.
Pursuant to s 66(1) of the 1987 Act, a worker is entitled to permanent impairment compensation resulting from an injury incurred in the course of employment provided the degree of permanent impairment is greater than 10%. The threshold serves the legitimate purpose of excluding trivial claims but is apt to distort the focus of the parties in the assessment process.
Section 65(1) of the 1987 Act provides that the degree of permanent impairment that results from an injury is to be assessed as provided by that section and Pt 7 of Ch 7 of the 1998 Act. The provisions of that part of the 1998 Act contemplate that the medical assessment process will produce a combined assessment for all of the impairments resulting from the same injury and all of the injuries arising out of the same incident: s 322. As already noted, there can be only one assessment of the degree of permanent impairment: s 322A.
The mechanism by which, in the case of a dispute, the task of assessing the degree of permanent impairment is assigned to an approved medical specialist is (or was at the material time in the present case) by referral by the Registrar: s 293 of the 1998 Act. At the time of the referral in the present case, that section provided: 293 Medical assessment (1) When a dispute referred for determination by the Commission concerns a medical dispute within the meaning of Part 7, the Registrar may, in accordance with this section, refer the medical dispute for medical assessment under Part 7, and defer determination of the dispute by the Commission pending the outcome of that medical assessment. (2) If the dispute concerns the degree of permanent impairment (including hearing loss) of an injured worker, the Registrar must refer that aspect of the dispute for assessment under Part 7 and defer determination of the dispute by the Commission pending the outcome of that medical assessment. (3) The Registrar may not refer for assessment: (a) a medical dispute concerning permanent impairment (including hearing loss) of an injured worker where liability is in issue and has not been determined by the Commission, or (b) a medical dispute other than a dispute concerning permanent impairment (including hearing loss) of an injured worker, except when dealing with the dispute under Part 5 (Expedited assessment).
As submitted by Mr Skates, the power conferred by that section is confined to the referral of a "medical dispute for medical assessment under Part 7". The term "medical dispute" is defined in s 319 of the 1998 Act to mean a dispute about one of the "matters" specified in the section: medical dispute means a dispute between a claimant and the person on whom a claim is made about any of the following matters or a question about any of the following matters in connection with a claim - (a) the worker's condition (including the worker's prognosis, the aetiology of the condition, and the treatment proposed or provided), (b) the worker's fitness for employment, (c) the degree of permanent impairment of the worker as a result of an injury, (d) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, and the extent of that proportion, (e) the nature and extent of loss of hearing suffered by a worker, (f) whether impairment is permanent, (g) whether the degree of permanent impairment of the injured worker is fully ascertainable.
The term "matters" in that definition assumes some importance. Section 325 of the 1998 Act requires the approved medical specialist to give a certificate as to the "matters" referred for assessment. The certificate is conclusively presumed to be correct as to the "matters" listed in s 326 which include "the degree of permanent impairment of the worker as a result of an injury".
Nowhere in those provision or indeed anywhere in either statute is there any reference to the assessment or referral of "body parts" or "body systems". The process contemplated by the legislation is that the Registrar will refer a "medical dispute", which means a dispute about a "matter" specified in the definition in s 319. The task of the approved medical specialist is to certify his or her assessment with respect to the "matter" referred; that is the statutory function to be performed. The certificate is then conclusive as to any of the "matters" listed in s 326 which are the subject of the certification. As already noted, they include "the degree of permanent impairment of the worker as a result of an injury".

Whether the assessment function was constrained by the "body part/s referred"

The draft notice of appeal specifies four grounds of appeal. I do not think it is necessary to address each individually. Each in one way or another challenges the correctness of the Appeal Panel's conclusion (upheld by the primary judge) that, having regard to the "body part/s" referred by the Registrar, the approved medical specialist was not entitled to assess the degree of permanent impairment in the whole of the left upper limb resulting from the injuries specified in the application (wrist, left ring finger and scarring) and that, in doing so, he "went beyond the jurisdiction conferred on him by the referral" (primary judgment at [71]).
The primary judge accepted at [68] that the question whether any impairment in Mr Skates' left upper limb (apart from the ring finger, the wrist and the scarring) arose from the injury to the ring finger, the wrist and the scarring was a medical dispute which could have been determined by the approved medical specialist. However, her Honour rejected Mr Skates' argument because she considered that an approved medical specialist is "bound by the terms of the referral to confine the matters determined to those which have been referred": at [69]. Her Honour further concluded that, in the present case, "it was not the Registrar who was constraining the referral; it was the terms of the Claimant's own application to resolve a dispute which contained the limitation". Mr Skates submits that reflects a misreading of his application to resolve a dispute.
As to the proposition that the approved medical specialist was bound by the terms of the referral, the primary judge referred to the decision of Master Malpass in Aircons Pty Limited v Registrar of the Workers Compensation Commission of NSW [2006] NSWSC 322. The circumstances of that case were quite different. The parties had reached agreement as to referral of the dispute to two approved medical specialists. One was a referral to a plastic surgeon "for assessment of the matters of scarring and skin discolouration only". He issued a certificate which included a diagnosis that plainly went beyond that limitation. It was in that context that his Honour said at [34]: "It seems to me that the referral should be regarded as being of the category of initiating process or pleadings. The certificates and the decision can be regarded as falling in the categories of reasons and the adjudication."
The comparison between a referral (drawn by an employee of the Commission) and initiating process (which is drawn by a claimant) was inapt. The document that should be regarded as being in the nature of an initiating process is the worker's application to resolve a dispute. In any event, there was no suggestion in Aircons that there was any discrepancy between the terms of the referral and the terms of the worker's application to resolve a dispute. The point of Master Malpass' remarks was to rein in a rogue medical specialist who went beyond the terms of the referral agreed between the parties. The decision does not hold that the Registrar has power to circumscribe the scope of the medical dispute between the parties.
The problem in the present case is that the terms of the referral did not reflect Mr Skates' case. With respect, the primary judge's statement at [69] that the body parts referred were "the very same body parts as had been identified by the Claimant in the application to resolve a dispute" was not correct (the difference is explained above). But more importantly, the focus on body parts is apt to distract attention from the precise matter to be assessed and certified by the approved medical specialist. Parts 4 and 5.6 of the application to resolve a dispute had to be read together and in the context of the statutory regime explained above. The legislation contemplates the referral of a "medical dispute", being one of the matters specified in s 319 (here, the degree of permanent impairment of the worker as a result of his injuries). Part 4 of the application specified the relevant injuries; part 5.6 specified the body systems claimed to have impairment as a result of those injuries. As submitted by Mr Skates, properly read, the application sought an assessment of the permanent impairment of the entire left upper body limb as a result of Mr Skates' injuries. There can have been no doubt in the insurer's mind on that issue. The medical evidence was replete with medical assessments of impairment in parts of the limb other than the wrist and ring finger, particularly the shoulder.
Since preparing this judgment, I have had the benefit of reading the judgment of Basten JA in draft. His Honour's reasoning has prompted me to clarify my position as to the status of the Registrar's referral. I do not mean to suggest that an approved medical specialist is free to ignore the terms of the referral. However, the medical dispute referred must be the medical dispute the parties have sought to have resolved.
Here, the applicant sought resolution of a medical dispute as to the degree of impairment in the body parts and systems specified in part 5.6 of the application to resolve a dispute, which were "left upper extremity, joint ring finger and scarring." The change in punctuation in the referral ("Left Upper Extremity (joint ring finger), scarring") had the effect of excluding not only the wrist but the whole of the left upper extremity apart from "joint ring finger" and scarring. The Registrar's punctuation should not have determined the parameters of the medical dispute. In my view, the medical dispute referred, and indeed the only medical dispute the Registrar had power to refer to the approved medical specialist, included a dispute as to impairment in the left upper extremity.
Further, I respectfully disagree that the combination of the manner in which the claim has been conducted on behalf of the applicant and the quantum involved warrant the refusal of leave. While the sum involved is small by reference to the limit for an appeal as of right or the quantum of other claims the Court is accustomed to determining, its significance to the injured worker is unknown. It cannot be assumed that the amount involved is small to him. It follows that I would grant leave to appeal and uphold the appeal.

Orders

I am not persuaded that the Court should make all of the orders sought in the amended draft notice of appeal. The applicant proposes that, in place of an order remitting the matter to the Registrar to be determined according to law, this Court should make an order remitting the matter to the Registrar to be determined "in accordance with the law as stated by this Court". The last clause ("as stated by this Court") is otiose. The law is as stated by this Court (for the time being at least). The proposed order "confirming" the other orders of the primary judge is also unnecessary. Those orders stand unless set aside. As explained by Basten JA, the proceedings should be remitted to the President of the Personal Injury Commission of New South Wales.
Accordingly, I propose the following orders: 1. Grant leave to appeal. 2. Allow the appeal. 3. Set aside the decision of third respondent dated 1 November 2019. 4. Remit the matter to the President of the Personal Injury Commission of New South Wales to be determined according to law. 5. Order the first respondent to pay the appellant's costs.

Endnotes

Skates v Hills Industries Ltd [2020] NSWSC 837.
Reasons of Appeal Panel, par 18.
Reasons of Appeal Panel, par 39.
An acronym used in the relevant guides to refer to the "Table for the Evaluation of Minor Skin Impairment".
Personal Injury Commission Act 2020 (NSW), s 6.
Personal Injury Commission Act, Sch 6.11, item [62]; commencement pursuant to s 2(3) and Proclamation dated 16 December 2020.

Amendments 14 July 2021 - Duplicate numbering on cover sheet fixed DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 July 2021

Workplace Injury Management and Worker's Compensation Act 1998(NSW)

At a glance

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Judgment (18 paragraphs)

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Legislation Cited (7)

Cases Cited (2)

Cited By (16)