Trustees of the Maronite Sisters of the Holy Family t/as Our Lady of Lebanon School v Carpenter

Supreme Court of NSW|2013-08-22

Judgment 1HER HONOUR: By summons filed 15 March 2013, the plaintiffs seeks firstly, an order in the nature of certiorari setting aside or declaring invalid the decision of the second defendant made on 18 February 2013, confirming the Medical Assessment Certificate of an AMS ("the decision") purportedly pursuant to s 328 of the Workplace Injury Management and Workers Compensation Act 1998 ("the Act"); and secondly, an order in the nature of mandamus remitting the application to the Registrar for reallocation of the matter to a Medical Appeal Panel for determination of the matter according to law. 2The plaintiffs are the Trustees of the Maronite Sisters of the Holy Family t/as Our Lady of Lebanon School ("the Trustees"). The plaintiffs relied on the affidavit of Thomas Murray sworn 6 May 2013. The first defendant is Stephen John Carpenter ("Mr Carpenter"). The second defendants are Bruce McManamey, Dr John Brian Stephenson and Dr Phillipa Harvey-Sutton as members of the Medical Appeal Panel of the Workers Compensation Commission of NSW ("the Appeal Panel"). The proceedings have been dismissed as against the third defendant, C Management Services Pty Ltd ("C Management") as Mr Carpenter has settled his claim against it. The fourth defendant is the Registrar of the Workers Compensation Commission of NSW ("the Registrar"). The second and fourth defendants have filed a submitting appearance.

Judicial review generally 3It is common ground that this Court has jurisdiction to grant any relief or remedy in the nature of a writ of certiorari which includes jurisdiction to quash the ultimate determination of a court or tribunal in any proceedings if that determination has been made on the basis of an error of law that appears on the face of the record of the proceedings. The face of the record includes the reasons expressed by the court or tribunal for its ultimate determination: s 69 of the Supreme Court Act 1970.

Background 4On 7 November 2001, Mr Carpenter injured his right knee while he was in the employ of C Management. On 16 September 2005, he injured his right knee while in the employ of the Trustees. In late 2005, Mr Carpenter claimed a consequential injury to his left hip as a result of an altered gait following the two right knee injuries. 5On 3 August 2006, an award was made in favour of Mr Carpenter as against C Management for 13.25% Whole Person Impairment ("WPI") loss of use of the right leg at or above the knee in respect of the injury suffered on 7 November 2001. 6On 8 December 2006, as against the Trustees, Mr Carpenter received an award for 8% WPI for impairment of the right lower extremity, in respect of the injury suffered on 16 September 2005. 7On 9 September 2009, Mr Carpenter underwent a left hip replacement operation. On 23 September 2010, he underwent total replacement of the right knee. 8On 26 July 2011, Mr Carpenter commenced proceedings claiming further lump sum compensation under s 66 of the Workers Compensation Act 1989 against both employers in respect of deterioration of his right knee injuries. The claim for deterioration was assessed by Approved Medical Specialist ("AMS") Dr Mastroianni. 9On 25 October 2011, AMS Dr Mastroianni issued a Medical Assessment Certificate ("MAC") in relation to both right knee injuries. He found:

In respect of the injury on 7 November 2001 - 50% loss of use of the right leg at or above the knee;
In respect of the injury on 16 September 2005 - 2% in respect of the right lower extremity. 10On 9 December 2011, determinations were made in accordance with the Medical Assessment Certificate. 11On 29 March 2012, Mr Carpenter commenced proceedings claiming lump sum compensation under s 66 in respect of, inter alia, a left hip injury sustained as a result of both the 2001 and 2005 right knee injuries. 12On 23 October 2012, Mr Carpenter was examined by AMS Dr Mastroianni in respect of the loss of use of the left leg at or above the knee, including any loss below the knee due to injury sustained on 7 November 2001, and WPI of the left lower extremity due to injury sustained on 16 September 2005. 13On 29 October 2012, AMS Dr Mastroianni issued a Medical Assessment Certificate in relation to Mr Carpenter's left leg, finding: In respect of the injury on 7 November 2001 - 0% WPI in respect of the left lower extremity; In respect of injury on 16 September 2005 - 10% WPI in respect of the left lower extremity. 14The Medical Assessment Certificate stated the following: "Following the first injury in 2001, there were no left leg symptoms. Under table of Disabilities, I assess 0% loss of efficient use of the left leg. The reason for assessing 0% impairment for the injury in 2001 is that he had no symptoms in the left leg prior to the second incident and, in my opinion, the arthritis in the left hip which pre existed the second accident was not affected by the first injury. Following the second injury of 16 September 2005, Mr Carpenter developed left hip pain. There was no injury to the left hip but I accept that favouring the right lower extremity aggravated the pre existing advanced osteoarthritis of the left hip. The left hip arthritis is constitutional but historically over a three year period, there was significant deterioration in the left hip and the x-rays show that the space narrowing went from 2mm to bone on bone. I am of the opinion that the continual aggravation of the left hip by favouring the right leg was a factor in the acceleration and need for the hip replacement. I assess 20% whole person impairment as a result of the hip replacement. In my opinion, the underling condition is constitutional. The incident in 2005 has been a factor in the condition progressing, leading to surgery, but the significant pathology and the need for the surgery is the underlying condition. I have therefore made a deduction of one half (1/2) for a pre existing condition which, in my opinion, reflects the impairment which pre existed." 15The Trustees appealed against the AMS' decision pursuant to s 327 of the Act. The Registrar referred the matter to an Appeal Panel. On 18 February 2013, the Appeal Panel confirmed the Medical Assessment Certificate as to the 10% WPI of the left leg. It is this decision by the Appeal Panel for which judicial review is sought.

The Medical Appeal Panel's decision 16The Medical Appeal Panel comprised of an Arbitrator Bruce McManamey and two Approved Medical Specialists Dr John Brian Stephenson and Dr Phillipa Harvey-Sutton. The Appeal Panel was asked to review the Medical Assessment Certificate issued by AMS Dr Mastroianni on 29 October 2012 in relation to Mr Carpenter's claim for injury to his left hip. 17The Trustees appealed against the Medical Assessment Certificate on the grounds that it contained a demonstrable error and that the assessment was made on the basis of incorrect criteria. The Trustees characterised the appeal as having three limbs. 18The first limb was that the AMS had determined that Mr Carpenter did not sustain any injury to his left hip as a result of the right knee injury sustained on 7 November 2001. It was submitted that this was outside the scope of the AMS's referral, noting that the liability for such an injury having been sustained had already been accepted by Mr Carpenter's employer at that time, C Management. 19The second limb was that the Medical Assessment Certificate was entirely inconsistent with the previous Certificate, also issued by AMS Dr Mastroianni, in respect of the earlier proceedings commenced by Mr Carpenter. 20The third limb was that the AMS had failed to properly apportion the permanent loss of use/whole person impairment between the two work injuries and had failed to properly apply s 323 of the Act. 21The relevant paragraphs of the Appeal Panel's decision are as follows: "15. In this matter the Registrar has determined that at least one of the grounds of appeal has been made out. The Panel has accordingly conducted a review of the material before it and reached its own conclusion concerning the correct assessment of the impairments and losses suffered by the Respondent. Since 2010 amendments the review is limited to the grounds of appeal on which the appeal is made. 16. The Respondent worker was referred to the AMS to assess loss of efficient use of the left leg at or above the knee resulting from injury on 7 November 2001. He was also asked to assess whole person impairment in respect of the left lower extremity resulting from injury on 16 September 2005. The AMS examined the Respondent on the 23 October 2012. ... 19. The AMS assessed the Respondent as having a fair outcome from a left hip replacement which equated to a 20% whole person impairment. The Appellant makes no complaint about that aspect of the assessment. 20. The AMS considered that the Respondent had suffered from constitutional left hip arthritis but historically over a three year period there was significant deterioration in the left hip and x-rays showed that the space narrowly went from 2mm to bone on bone. The AMS also considered that the continual aggravation of the left hip by favouring the right leg was a factor in the acceleration in the need for the hip replacement. The AMS made a deduction of one half pursuant to Section 323. This appeal is in respect of this deduction. 21. The AMS had also been of the view that there was no loss of efficient use in the left leg as a result of the injuries sustained on the 7 November 2001. 22. The Appellant firstly submits that the AMS should have considered that there was a loss of efficient use resulting from the injury to the right knee on the 7 November 2001. This is an unusual submission given that such an assessment would result in additional liability for the Appellant. Despite that the Appellant submits that the AMS was required to accept that there had been an injury to the left leg as a result of the referral. 23. The Panel accepts that the AMS was required to accept that there was a consequential injury to the left leg however it does not follow that he was required to find that there was a permanent loss of efficient use of the left leg. The history taken by the AMS was that the left hip remained symptom free until after the fall in September 2005. In those circumstances he was entitled to conclude that any injury to the left hip resulting from the earlier injury in 2001 had not resulted in any loss of efficient use. 24. The Appellant further submits that the AMS was required to have regard to his previous MAC issued on the 25 October 2011 in which he considered that the injury in 2001 was the more significant injury to the right knee and that 90% of the impairment in the right lower extremity in that time was attributable to the earlier injury. 25. The question before the AMS on this occasion was a different one. He was considering the causes of the impairment in the left lower extremity. That enquiry involved different considerations to the question of the impairment in the right lower extremity. The AMS was entitled to consider that the relative contributions of the two right leg injuries were different when considering their effect upon the left hip. The AMS observed that with respect to the left hip there was a significant deterioration in the three years immediately following the injury on the 16 September 2005. That evidence is indicative of the second injury being a major contributing factor to the ultimate need for the left hip replacement. The deduction of a 50% is consistent with that history. 26. The Panel notes that the AMS approached the matter on the basis that there was no injury to the left hip in the fall on the 16 September 2005. Whilst the Respondent does not take this point the Panel notes that the Application to Resolve a Dispute specifically pleaded that there was an injury to the left hip when the Respondent slipped on the stairs on the 16 September 2005. That pleading was not disputed and accordingly the assessment must be based on an acceptance that the injury to the left hip was not only a consequence of the right knee injury but was also a direct result of the fall. When that matter is taken into account there is further support for the AMS' conclusion that the appropriate deduction is 50%. Having considered all of the evidence the Panel agrees with the conclusion reached by the AMS." 22The plaintiffs seek a judicial review of the Appeal Panel's decision and a declaration pursuant to s 69 of the Supreme Court Act 1970 on these three grounds.

Grounds 1 and 2 23These two grounds are related. Ground 1 of the plaintiff's application for judicial review is that the Appeal Panel exceeded its jurisdiction, misunderstood the nature of the task it was to perform, and/or misapplied the law to the facts when it went beyond the ground of appeal on which the appeal was made, in breach of s 328(2) of the Act. The plaintiff submitted that the Appeal Panel failed to confine the review to the grounds upon which the appeal was made in contravention of s 328(2). 24Ground 2 is that if the Appeal Panel had the power to go beyond the particulars in the grounds of review, the Appeal Panel failed to warn the parties that it intended to do so, or of findings it was considering making, thus denying the parties natural justice. 25Both parties agree on the interpretation of s 328(2) of the Act and that Siddick v Workcover Authority of NSW [2008] NSWCA 116 is authority for the proposition that if the Appeal Panel has power to go beyond the grounds of appeal, it can do so if it notified the parties and gave them an opportunity to be heard. 26Section 328 of the Act sets out the procedure on appeal. It reads as follows: "328 Procedure on appeal (1) An appeal against a medical assessment is to be heard by an Appeal Panel constituted by 2 approved medical specialists and 1 Arbitrator, chosen by the Registrar. (2) The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made. The WorkCover Guidelines can provide for the procedure on an appeal. (3) Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the medical assessment appealed against may not be given on an appeal by a party to the appeal unless the evidence was not available to the party before that medical assessment and could not reasonably have been obtained by the party before that medical assessment. (4) When attending an Appeal Panel for the purposes of an assessment, an injured worker is entitled to be accompanied by a person (whether or not a legal adviser or agent) to act as the injured worker's advocate and assist him or her to present his or her case to the Appeal Panel. (5) The Appeal Panel may confirm the certificate of assessment given in connection with the medical assessment appealed against, or may revoke that certificate and issue a new certificate as to the matters concerned. Section 326 applies to any such new certificate. (6) The decision of a majority of the members of an Appeal Panel is the decision of the Appeal Panel." 27Section 328 was amended in 2011 by the Workers Compensation Legislation Amendment Bill 2010, Sch 2. The explanatory memorandum to the amending bill stated as follows: "The object of this Bill is to amend the Workers Compensation Act 1987 and Workplace Injury Management and Workers Compensation Act 1998 as follows: ... (c) to make it clear that an appeal against a medical assessment is limited to the grounds on which the appeal is made and is not a review of any other aspect of the medical assessment." 28Siddick v Workcover Authority of NSW was decided before s 328(2) was amended. McColl JA said (Mason P agreeing) in respect of review under s 328 of the Act: "101 In my view it is inappropriate to resolve the issues by applying prescriptive labels to the nature of the s 328 review. I am, however, of the view that while prima facie the Appeal Panel is confined to the grounds the Registrar has let through the gate, it can consider other grounds capable of coming within one or other of the s 327(3) heads, if it gives the parties an opportunity to be heard. This is not a backdoor resurrection of the appellant's abandoned third ground of appeal, simply a recognition of the proposition that determinations, which affect the 'rights, interests and legitimate expectations' of the parties, attract requirements of procedural fairness: Kioa v West [1985] HCA 81; (1985) 159 CLR 550 (at 584) per Mason J. This includes giving a party an opportunity to deal with material which can be characterised as credible, relevant and significant and adverse to the interests of that person: Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 72; (2005) 225 CLR 88 (at [14]-[18]) per Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ. ... 104 In my view, therefore, while it was open to the Appeal Panel to depart from the grounds of appeal the respondent had identified, it could only do so if it notified the parties and gave them an opportunity to be heard." 29The parties agreed that if the Appeal Panel has gone outside the grounds of appeal, the decision in Siddick may still apply. 30It is paragraph 26 of the Appeal Panel's decision that is the focus of criticism. In [26] the Appeal Panel noted that the AMS approached the matter on the basis that there was no injury to Mr Carpenter's left hip in the fall on 16 September 2005. The Appeal Panel also noted that Mr Carpenter's Application to Resolve a Dispute specifically pleaded that there was an injury to the left hip when he slipped on the stairs on 16 September 2005, noting that this point was not taken by Mr Carpenter in the appeal proceedings. 31The plaintiff submits that the Appeal Panel has supported its decision with reference to a matter which did not form part of the basis for the appeal and thus misconceived its function, took into account an irrelevant consideration and thus misconceived its function, took into account an irrelevant consideration, misunderstood the task that it had to perform, asked the wrong question and exceeded the power granted to it by the statute, thus exceeding its jurisdiction. 32Mr Carpenter concedes that paragraph 26 of the Appeal Panel's decision is "somewhat bizarre" but submits that it amounts to no more than an obiter remark on a hypothetical assumption. The referral to the AMS had been stated plainly by AMS Dr Mastroianni in his report and such referral related only to the two frank injuries to the right knee. Further, it was clear that the AMS made his consideration in relation to the assessment of WPI of the left leg on that basis. The AMS was bound by the referral to him and if some other injury was not referred to the AMS, this was not a matter for the Appeal Panel. It was submitted that the Appeal Panel's decision to dismiss the appeal has been made on grounds other than what is contained in paragraph 26. Examination of the rest of the Appeal Panel's decision, especially paragraphs 23-25, adequately explain the decision without any reference to paragraph 26. 33The Appeal Panel's reasons should not be read with an eye too keenly attuned to error: see Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259. However, while at the outset the Appeal Panel correctly spelt out that it had limited grounds of review pursuant to s 328(2) it is my view that when the decision is read as a whole, paragraph [26] does not stand alone as obiter comment. In paragraph 26, the Appeal Panel notes that Mr Carpenter's application for resolution of the dispute in relation to his left hip specifically pleaded that there was also an injury to the left hip when Mr Carpenter injured his right knee on 16 September 2005, and that this pleading was not disputed by the plaintiff at that time. The Appeal Panel then commented that Dr Mastroianni's assessment "must be based" on an acceptance that the left hip injury was a consequence of the right knee injury and also a direct result of a fall. The Appeal Panel then said that when "this matter is taken into account there is further support" to the AMS's conclusion to make a deduction of 50% on the WPI of the left leg, which reduced the liability of the plaintiff from a WPI of 20% to a WPI of 10%. 34While the Appeal Panel is entitled to refer to the contents of the application it went further when it pointed out that the AMS in his assessment did not refer to any injury of the left hip resulting from a fall. In my view, the Appeal Panel's consideration of a fall contributing to Mr Carpenter's left hip injury formed part of the reasoning process in affirming the AMS's decision. The Appeal Panel's comments in paragraph 26 in relation to the fall by Mr Carpenter on 16 September 2005 raised an issue which did not form part of the basis for the appeal. 35The wording of s 328(2) is clear, the Appeal Panel's review "is limited to the grounds of appeal on which the appeal is made". In raising an issue which did not form part of the basis for the appeal, the Appeal Panel acted beyond its powers. In the event that I am wrong, in accordance with Siddick the parties should have been given an opportunity to be heard on this issue. They were not afforded this opportunity. The result is that the application for judicial review succeeds and the decision of the Appeal Panel should be set aside.

Ground 3 36Ground 3 claimed by the plaintiff is that the Appeal Panel failed to give genuine, realistic and proper consideration and constructively failed to exercise its jurisdiction and/or sidestepped an aspect or integer of the employer's case on appeal and/or asked the wrong question and/or failed to give adequate reasons for the decision. While it is not strictly necessary that I deal with this ground of appeal, I will briefly address it. 37The plaintiff submits that the plaintiff's complaint was not sufficiently dealt with by the Appeal Panel. The AMS states that there was no injury to the left hip in the 2005 incident but accepts that favouring the right knee aggravated Mr Carpenter's pre-existing osteoarthritis of the left hip. The plaintiff submits that the AMS appears to have forgotten his earlier characterization and assessment of the 2005 injury as an aggravation of the 2001 injury. It can therefore be inferred, it is submitted, that if the condition of the right knee following the 2005 right knee injury was predominantly a consequence of the 2001 right knee injury, then an injury to the left hip which flowed from aggravation of the right knee must have been contributed to by the 2001 right knee injury. The plaintiff further submits that the Appeal Panel proceeded from the assumption that the second right knee impairment is discrete and separate from the first. They failed to deal with the fact that the impairment leading to the altered gait which followed the second right-knee injury was contributed to by the first right knee injury. 38The plaintiff submits that the Appeal Panel failed to deal with the gravamen of the plaintiff's complaint on the question of the relative contributions of the two knee injuries. This was an error which can be characterised as sidestepping an aspect of the claim leading to a failure to exercise jurisdiction (SZQMT v Minister for Immigration and Citizenship [2012] FCA 840, particularly [27] - [30]). Alternatively it may be characterised as asking the wrong question, or identifying a wrong issue (Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163 at [14]). In addition, the reasons must adequately explain why a particular conclusion has been reached (Campbelltown City Council v Vegan [2006] NSWCA 284; (2006) 67 NSWLR 372 at [121]). It is submitted that the reasons do not deal with the plaintiff's complaint and do not allow it to understand why its complaint has been rejected. 39Mr Carpenter submits that the Appeal Panel directed its attention to the subject of the Appeal, that is, the finding of causation made by the AMS. In giving its decision, the Appeal Panel noted the alleged inconsistency between the earlier findings of Dr Mastroianni in the first MAC issued on 25 October 2011 and the second MAC issued on 29 October 2012 as was raised on the plaintiff's application to appeal against the decision of Dr Mastroianni. The Appeal Panel pointed out that the questions of causation in relation to the right knee and the left hip were different. The role of the Appeal Panel, it was submitted, was to "review" the decision of Dr Mastroianni in relation to the left hip and this was what it did. 40Mr Carpenter submits that the reasons given by the Appeal Panel were sufficient. As was said by Handley AJA in Campbelltown City Council v Vegan & Ors [2006] NSWCA 284 at [20]: "20 A duty to give proper reasons is a legal incident of the judicial process: Public Service Board of New South Wales v Osmond (1986) 159 CLR 656, 667, but is not normally a legal incident of administrative decision making (ibid), nor is it a legal incident of expert assessment pursuant to law such as that provided for in the Act." 41Further, at [121] - [122], Basten JA said: "121 Where it is necessary for the Panel to make findings of primary fact, in order to reach a particular conclusion as to the existence, nature and extent of any physical impairment, it may be expected that the findings of material facts will be set out in its reasons. Where facts are in dispute, it may be necessary to refer to evidence or other material on which findings are based, but the extent to which this is necessary will vary from case to case. More importantly, where more than one conclusion is open, it will be necessary for the Panel to give some explanation of its preference for one conclusion over another. That aspect may have particular significance in circumstances where the medical members of a Panel have made their own assessment of the applicant's condition and have come to a different conclusion from that reached by other medical practitioners, as set out in reports provided to the Panel. 122 On the other hand, to fulfil a minimum legal standard, the reasons need not be extensive or provide detailed explanation of the criteria applied by medical specialists in reaching a professional judgment: see Soulemezis at 273-274 (Mahoney JA) and 281-282 (McHugh JA). At least, that will be so where the medical science is not controversial: if it is, a more expansive explanation may be required." (citations omitted) 42The Appeal Panel states at [25] of their decision that: "The AMS was entitled to consider the relative contributions of the two right leg injuries were different when considering their effect upon the left hip." The Appeal Panel was satisfied that the AMS had considered the 2001 and 2005 injuries to the right knee, and that the AMS had observed there was a significant deterioration in the left hip after the injury to the right knee on 16 September 2005, that being evidence that was "indicative of the second injury being a major contributing factor to the ultimate need for the left hip replacement". It is my view that the Appeal Panel did deal sufficiently with the gravamen of the plaintiff's complaint with regard to the relative contributions of the two right knee injuries. The AMS's assessment was in relation to the injury to the left leg. The Appeal Panel found that the AMS was entitled to conclude that the earlier injury to the right knee in 2001 had not resulted in any loss of efficient use of the left leg. This ground seeking judicial review fails. 43The result is that the Appeal Panel did act beyond its power (as in Ground 1) and the decision of the Appeal Panel should be set aside. 44Costs are discretionary. Costs usually follow the event. As the plaintiff has succeeded in its application for judicial review, the first defendant is to pay the plaintiff's costs as agreed or assessed.

The Court declares that: (1) The decision of the Medical Appeal Panel in matter number MI-003113/12 issued on 18 February 2013 is vitiated by error of law.

The Court makes an order: (2) In the nature of certiorari removing into the Court the decision of the Medical Appeal Panel issued on 13 February 2013 in matter number MI-003113/12 and quashing that decision.

The Court further orders that: (3) Matter number MI-003113/12 be remitted to the Registrar of the Workers Compensation Commission to be determined in accordance with law. (4) The first defendant is to pay the plaintiff's costs as agreed or assessed.

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: 27 August 2013

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