Versace v Australia's Best Tyres & Auto Pty Limited

Supreme Court of NSW|2016-09-30|Before: Schmidt J

Judgment

Mr Versace was injured at work in 2012, suffering permanent impairment as a result. He now seeks orders under s 69 of the Supreme Court Act 1970 (NSW), setting aside a medical assessment certificate and statement of reasons for a decision given about the nature and extent of his psychological injury by a Medical Appeal Panel of the Workers Compensation Commission of New South Wales under the Workplace Injury Management and Workers Compensation Act 1998 (NSW). The result of the Panel's decision was that Mr Versace is not entitled to either compensation or damages under the Workers Compensation Act 1987 (NSW) for his impairment.
It is common ground that the Court has no power to entertain a merits review of the Appeal Panel's decision. In issue is whether Mr Versace's application, in truth, concerns jurisdictional error or error on the face of the record amenable to relief under s 69.

The medical specialist's decision

In order to resolve what is in issue, it is necessary to consider the role of medical specialists under this statutory scheme and the reasons which the medical specialist gave for the conclusions which he reached, having himself examined Mr Versace.
Approved medical specialists are appointed under s 321 of the Workplace Injury Act to deal with medical disputes, which are in s 319 defined to mean: "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."
In his reasons, the medical specialist noted that the dispute referred to him for assessment in relation to Mr Versace was: "the degree of permanent impairment of the worker as a result of an injury (s319(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 (s319(d)) whether impairment is permanent (s319(f)) whether the degree of permanent impairment of the injured worker is fully ascertainable (s319(g))"
The medical specialist was obliged to undertake his assessment of Mr Versace's impairment in accordance with clause 11.7 of the Guides, which provide: "11.7 It is expected that the psychiatrist will provide a rationale for the rating based on the injured worker's psychiatric symptoms. The diagnosis is among the factors to be considered in assessing the severity and possible duration of the impairment, but is not the sole criterion to be used. Clinical assessment of the person may include information from the injured worker's own description of his or her functioning limitations; from family members and others who may have knowledge of the person. Medical reports, feedback from treating professionals, results of standardised tests, including appropriate psychometric testing performed by a qualified clinical psychologist, and work evaluations may provide useful information to assist with the assessment. Evaluation of impairment will need to take into account variations in the level of functioning over time. Percentage impairment refers to "whole person impairment"."
The assessment had to be undertaken by reference to categories specified in tables provided at 11.1 to 11.6 of the Guides. Table 11.5 provides a psychiatric impairment scale for the category "concentration, persistence and pace".
Clause 11.12 required that the behavioural consequences of Mr Versace's psychiatric disorder be addressed by reference to six items which assess an area of functional impairment, namely "self care and personal hygiene; social and recreational activities; travel; social functioning (relationships); concentration; and employability". Clause 11.13 required: "11.13 Impairment in each area is rated using class descriptors. Classes range from 1 to 5, in accordance with severity. The standard form must be used when scoring the PIRS. The examples of activities are examples only. The assessing psychiatrist should take account of the person's cultural background. Consider activities that are usual for the person's age, sex and cultural norms."
The medical specialist concluded that Mr Versace was permanently impaired and that the correct classification of his impairment in respect of the description for the "concentration, persistence and pace" category was Class 3. The employer's case on appeal was that it ought to have been Class 2.
The medical specialist was obliged to give reasons for his conclusions as to the matters in dispute (s 325(2)(c)). The reasons given included a brief history of the incident; Mr Versace's symptoms, as well as subsequent events, including the treatment he received; the assessor's findings; a summary and diagnosis; an evaluation of his permanent impairment; the facts on which the assessment of his whole person impairment was based; and the reasons for the assessed deductions for previous injury, conditions or abnormality. The medical specialist also issued a medical assessment certificate and a "PIRS Rating Form".
The history the medical specialist noted Mr Versace had given was: "Brief history of the incident / onset of symptoms and of subsequent related events including treatment: Mr Versace is a 64-year-old married man. He is currently working 20 to 24 hours per week in a very basic customer service role for a real estate agency. He had established and built up a tyre business, Australia's Best Tyres, having previously qualified as an automotive engineer. He opted to sell the business to two employees in order to help consolidate his son's business plans. Following the sale of the business Mr Versace was marginalised and effectively bullied out of employment by the two owners. There are several accounts of Mr Versace being abused, sworn at, micromanaged, subject to demeaning or humiliating behaviour, often in front of customers and co-workers, and subject to excessive demands. Mr Versace sustained a serious left shoulder injury with a rupture of the left head of biceps tendon and left supraspinatus whilst lifting a heavy weight, and this has been an ongoing source of concern and pain with associated disability. I note in the Consent Orders there is the presumed existence of both left upper extremity injury and a substantive psychiatric, i.e., primary injury. He also suffers from an erosion of the right eye, which has been the subject of ongoing ophthalmological intervention. I note that the independent medical examinations of Dr Synnott, initially in January and subsequently in February 2013, made a diagnosis of adjustment disorder, but Dr Synnott revised his opinion in light of a factual investigation which challenged Mr Versace's account of events. By contrast, Dr Ryan, his treating psychiatrist, referred to Mr Versace developing psychiatric symptoms in the context of a "work predicament... can be characterised as one of threat associated with powerlessness, helplessness and non-resolution". Mr Versace was referred to the care of a psychologist, Mr Albassit, who he has seen routinely. Mr Albassit made diagnoses of major depressive disorder and generalised anxiety disorder. I note that Dr Rastogi examined Mr Versace as an independent consultant in August 2014 and diagnosed a chronic adjustment disorder with anxiety and depression. Mr Versace's local medical officer, Dr Curry, in his notes reports contemporaneously the presence of a number of significant health problems including hypertension and morbid obesity in addition to the evolving workplace problems and his psychological symptoms. A series of medical certificates document depression secondary to workplace bullying. There is a considerable amount of correspondence relating to Mr Versace's various physical injuries. I note in particular Dr Patrick diagnosed him as suffering from the various tendinous injuries in addition to an element of brachial plexus irritation with a significant degree of WPI. Dr Bokor indicates that further surgery would be required. By April 2015 Dr Ryan reported that Mr Versace had reasonable functioning, at around 16 hours per week, and that his exercise programme had been quite helpful. Unfortunately, Mr Versace was hospitalised with a pneumococcal pneumonia in mid-2015 and developed a hospital-acquired staphylococcal cellulitis of the right leg which has been difficult to treat and has precluded him from participating in both exercise and also hydrotherapy treatments for his shoulder, which has led to further deterioration in both pain and functional capacity. Mr Versace had attempted to return to work after his shoulder injury but subsequently ceased after a catastrophic panic attack in October 2012. He was unable to return to employment and his mental state deteriorated in the subsequent 12 months prior to him starting his modified duties with the current employer."
The medical specialist also noted the ongoing treatment Mr Versace was receiving for depression and his deteriorating psychiatric condition, observing: "He takes low dose mirtazapine 7.5mg occasionally, varying with 15mg He consults with Dr Ryan periodically, He sees his psychologist every six weeks. He had been participating in a gym programme. … Mr Versace acknowledges that his mental state has deteriorated since he was hospitalised mid-year with the downstream consequences of the cellulitis in particular. He harbours constant hostile and at times murderous intentions towards his former employers, but has no intent of acting on these. He is irritable and this often is focused against his wife. He ruminates constantly over his treatment in the workplace. He reports that his mood is chronically low with no variation through the day. He has diminished motivation and interest in otherwise enjoyed activities, although has some capacity to react positively with his grandchildren. He has significant degree of self-reproach and periods of hopelessness. He had been previously suicidal and researched methods for completed suicide on the internet, but has not been recently disposed to this. He has periods of significant anxiety manifesting intermittently as gastrointestinal disturbance, dry mouth and several instances of globus hystericus. In recent times he has evolved a more significant pattern of obsessive-compulsive behaviour including preoccupation with symmetry, cleanliness, frequent checking behaviours and anxiety. He pointed out that he was quite uncomfortable in my office, given the way in which the desk appeared disorganised, the telephone was at an inappropriate angle, and other quite frankly obsessional preoccupations. He is forgetful of the details of conversations, frequently repeats himself, misplaces personal belongings and cannot read beyond a paragraph before losing focus."
The reports in evidence included that of the treating psychologists and psychiatrists. Dr Synnott, who saw Mr Versace on 8 January 2013, diagnosed him to be suffering an adjustment disorder with anxiety and depressive mood. He considered that Mr Versace's desire to return to work revealed that he had a constructive attitude, but that a return to his employment would see a deterioration in his psychological state. A gradual return to other work was recommended. Mr Versace later retrained. In August 2013, Dr Rastogi considered that Mr Versace had moderate impairment in the concentration, persistence and pace category, having difficulty following complex instructions due to severe anxiety and being unable to read or watch TV due to agitation.
In his April 2015 report, the treating psychiatrist Dr Ryan advised that Mr Versace was reasonably functional, but should contain his work hours to 16 per week. In his June 2015 report the treating psychologist Mr Albassit described Mr Versace's worsening symptomology over two years and his then "limited capacity for concentration with diminishing short term memory".
After referring to Mr Versace's then general health, work history, social activities and employment of 20 to 25 hours per week in "very basic customer service role in a real estate office, in which he seemed to be working to his full capacity", the medical assessor made findings about his mental state examination, observing: "Mr Versace attended the interview alone. He had a swollen and mildly inflamed shin area. He appeared in mild physical discomfort. He was quite irritable, swore frequently through the interview and seemed quite agitated and bristling. He voiced a number of significant obsessional symptoms, particularly about the contents of the office. His affect was labile. His mood was dysphoric and anxious. There were no signs of intoxication or withdrawal from alcohol or other drugs. There were no signs of psychosis. He registered five items after four attempts but could only recall three of these at one and five minutes. He suffered a mini panic episode whilst performing the serial sevens task. He was able to spell a five-letter word backwards. His general knowledge was quite limited to rugby league. On several occasions he broke down in tears during the assessment."
In his summary the medical specialist considered Mr Versace's appropriate diagnosis to be a persistent depressive disorder, observing that whilst at times irritable and irascible, Mr Versace seemed to be a coherent and legitimate historian.
In relation to the concentration, persistence and pace classification, the medical specialist recorded in the PIRS rating form an assessment of Class 3, noting "[p]oor performance on cognitive assessment; forgetful; difficulty persisting at tasks; unable to read beyond a paragraph".
This conclusion was amongst those challenged on the appeal.

The Panel's statutory task

Section 328 of the Workplace Injury Act provides: "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 Workers Compensation 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."
The available grounds of appeal are those specified in s 327(3), namely: "(a) deterioration of the worker's condition that results in an increase in the degree of permanent impairment, (b) availability of additional relevant information (but only if the additional information was not available to, and could not reasonably have been obtained by, the appellant before the medical assessment appealed against), (c) the assessment was made on the basis of incorrect criteria, (d) the medical assessment certificate contains a demonstrable error."
The nature of an appeal under s 328(2) "by way of review" was considered in Siddik v WorkCover Authority of NSW [2008] NSWCA 116. It was there held at [100] to be "a novel form of appeal", the legislature having created a flexible model which involves either a hearing de novo, (that is when new evidence is received because of changed circumstances, for example (see at [96] - [98]); or a rehearing, (which involves identification and correction of error (see at [95]).
It was there also held at [101] 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." Section 328(2) was, however, later amended to confine the grounds of appeal which a Panel may consider, to those pursued by the appellant.
In the result, in Mr Versace's case, if further evidence had been received on appeal, including if the Panel had considered it necessary itself to examine him, then the Panel would have been obliged to determine whether that material affected the conclusions reached by the medical specialist, conducting the assessment "anew" (Siddik at [97]).
Had the Panel received such new evidence, so that it had to conduct such an assessment in the course of the appeal, the provisions of s 324(3) of the Act would have come into play. That gives approved medical specialists who are members of a Panel assessing a medical dispute in the course of an appeal, "all the powers of an approved medical specialist under this section on an assessment of a medical dispute". Those powers are specified by s 324(1) to be to: "(a) consult with any medical practitioner or other health care professional who is treating or has treated the worker, and (b) call for the production of such medical records (including X-rays and the results of other tests) and other information as the approved medical specialist considers necessary or desirable for the purposes of assessing a medical dispute referred to him or her, and (c) require the worker to submit himself or herself for examination by the approved medical specialist."
It follows that because that the Panel did not receive new evidence, its role on this appeal were not those of a medical specialist under s 324(1), but rather to deal with and correct alleged error raised by the appeal. In undertaking that task it could not simply substitute its own view for that of the medical specialist, absent a finding of error of the kind alleged on the appeal.
Siddik was referred to in the reasons given by the Panel for its decision. It observed: "21. The role of the Medical Appeal Panel was considered by the Court of Appeal in the case of Siddik v WorkCover Authority of NSW [2008] NSWCA 116. The Court held that while prima facie the Appeal Panel is confined to the grounds the Registrar has let through the gateway, it can consider other grounds capable of coming within one or other of the section 327(3) heads, if it gives the parties an opportunity to be heard. An appeal by way of review may, depending upon the circumstances, involve either a hearing de novo or a rehearing. Such a flexible model assists the objectives of the legislation. 22. In Campbelltown City Council v Vegan [2006] NSWCA 284 the Court of Appeal held that the Appeal Panel is obliged to give reasons. Where there are disputes of fact it maybe 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. Where more than one conclusion is open it will be necessary to explain why one conclusion is preferred. On the other hand the reasons need not be extensive or provide detailed explanation of the criteria applied by the medical professionals in reaching a professional judgement. 23. Though the power of review is far ranging it is nonetheless confined to the matters which can be the subject of appeal. Section 327(2) of the 1998 Act restricts those matters to the matters about which the AMS certificate is binding. 24. In this matter the Registrar has determined that at least one of the grounds of appeal under section 327(3) is made put. 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 worker."
In issue was whether in so approaching its task on this appeal, the Panel had erred and whether in the course it pursued, it had denied Mr Versace procedural fairness.
It may be immediately observed from what it said at [21], that the Panel was seemingly not conscious of the effect of the amendment to s 328(2), after the decision in Siddik was given. That limited its review "to the grounds of appeal on which the appeal is made". The Panel's description at [24] of the course it had pursued in its review, was not consistent with adherence to the s 328(2) limitation and it also revealed that it had failed to consider whether in Mr Versace's case it was embarking on a rehearing, or a hearing de novo. This, it is apparent, has led the Panel into error.

The parties' cases

Mr Versace's case was that the Panel's departure from its statutory task was revealed both by what it said at [24] as to its approach and what it had concluded at [56], which established that it had simply substituted its own opinion for that of the medical specialist, contrary to its statutory obligation. This was in issue.
Mr Versace submitted that the medical assessor's conclusions had been reached in part on his clinical examination, an advantage which the Panel did not share. Nor had it undertaken its own cognitive assessment, or a mental state examination. He argued that in those circumstances, if the Panel had identified error on the medical specialist's part, it ought to have re-examined him and further, given what had been raised on the appeal, it should also have addressed in its reasons material evidence which had influenced the medical specialist's decision, with which it had disagreed.
Instead, Mr Versace submitted, the Panel had wrongly based its conclusions on assumptions it had made about the real estate retraining course which he had earlier undertaken; what level of application that had required on his part; on a view that working between 16 and 25 hours per week was inconsistent with a Class 3 classification; and that him no longer reading newspapers was not due to his inability to concentrate or persist, contrary to the evidence. The Panel had also failed to consider relevant evidence, which the medical specialist had considered, having had the benefit of a clinical assessment, which the Panel did not have. Nor did it have access to a transcript or clinical notes of that examination.
Mr Versace also contended that if the Panel had come to the view that the medical specialist might have erred, not only should it have given him an opportunity to address it, before it reached an adverse conclusion, but it ought to have examined him itself, so as to be satisfied that it had an accurate and complete history of his pre-accident lifestyle, activities and habits and the extent to which those may have changed as a result of his injuries.
The case advanced for Australia's Best Tyres was that not only did the Panel properly understand its role, as its discussion of other aspects of the appeal on which it had failed revealed, it had properly confined itself to the consideration, identification and correction of the one error which it accepted that the medical specialist had fallen into, in relation to the "concentration, persistence and pace" category. Its conclusion that Mr Versace had been wrongly classified as falling into Class 3, when the correct classification was Class 2, was open and did not involve any error amenable to correction by this Court.
It was also argued that given the nature of the complaints raised by the appeal, both the Panel's determination of whether error had been made and its correction involved "the same process". Its reasons had to be read beneficially and as a whole. It was thus relevant to consider that the Panel had rejected other grounds of its appeal, because it had not been convinced of the error alleged and had upheld only one ground of appeal, because of the error it had identified.
In the result, the Panel did not err in its approach to the resolution of that aspect of the appeal. Mr Versace's submissions in reality sought an impermissible merits review of the decision (see Attorney-General (NSW) v Quin (1990) 170 CLR 1; [1990] HCA 21 at 35 - 36; [17]). Under this statutory scheme the Panel was not obliged to permit him to address it on the error it had identified, or to examine him itself, before giving its decision.

The Appeal Panel's reasons

A Panel's reasons must be considered in the way discussed in Minister for Immigration & Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 at 291. They must be read as a whole, considered fairly and without "combing through the words with a fine appellate tooth-comb, against the prospect that a verbal slip will be found warranting the inference of an error of law".
The reasons given by the Panel began with the background to the appeal and the result of its preliminary review, that it was not necessary for it to examine Mr Versace further, "because there is sufficient material to determine the matter without further examination". Under this statutory scheme it was entitled to pursue that course.
After noting the material it had before it, the Panel turned to the relevant factual background, where it noted that Mr Versace's psychological injury had been conceded, but that there were competing views amongst the psychiatrists who had assessed Mr Versace, as to the nature and extent of his impairment. The Panel noted: "15. Insofar as it concerns this panel, the psychological injury was considered to have occurred from events occurring through the term of his employment, and in particular conflict and harassment by the new owners of the appellant employer's business to whom the respondent worker had sold as the former owner of the business. The respondent worker remained on as an employee pursuant to the terms of sale. 16. In the claim for lump sum benefits, the respondent worker asserted 18 per cent whole person impairment based on an assessment by Dr Richa Rastogi dated 15 August 2014. 17. Although psychological injury is ultimately conceded, in the Reply the appellant employer relied upon an opinion of Dr Inglis Synnott dated 8 January 2013. Dr Synnott thought the symptoms described met the diagnostic criteria of Adjustment Disorder with anxiety and depressed mood, "but the situation is more complex than simply assigning a psychiatric diagnosis". He thought what he described as a "industrial situation" was the driver of his problems and it was that situation that needed to be addressed. He counselled to not "overly medicalise" the situation. 18. In the MAC, the AMS assessed a gross impairment of 17 per cent but deducted one-tenth due to a "partial contribution" to a degree of secondary psychological injury as a result of chronic pain from the left upper extremity injury, leaving the subject injury-related impairment of 15 per cent. Relevant details of the history, examination and the conclusions made by the AMS insofar as the relevant matters under appear are concerned will be discussed below under "Findings and Reasons"."
The Panel also noted that neither party had sought a hearing. After referring to the nature of its statutory task (quoted above), it noted the grounds of appeal and the medical specialist's conclusion that Mr Versace suffered from persisting Depressive Disorder, a diagnosis which had not been challenged on appeal. The Panel then said at [26] that it was "in general agreement with this diagnosis and proceeds with the appeal on the basis of the AMS findings".
The Panel turned then to the parties' submissions, accepting at [29] Mr Versace's case that the PIRS class descriptors were "examples only" and not prescriptive or requirements. The Panel referred to Clauses 1.13 and 11.13 of the Guides, which provide: "1.13 The WorkCover Guides are meant to assist suitably qualified and experienced not meant to provide a "recipe approach" to the assessment of permanent impairment. Medical specialists are required to exercise their clinical judgement [sic] in determining diagnosis, whether the original condition has resulted in an impairment and whether the impairment is permanent The degree of permanent impairment that results from the injury must be determined using the tables, graphs and methodology given in the WorkCover Guides and AMA5. Section 1.5 of Chapter 1 of AMA5 (p 10) applies to the conduct of assessments and expands on this concept." "11.13 Impairment in each area is rated using class descriptors. Classes range from 1 to 5, in accordance with severity. The standard form must be used when scoring the PRIS. The examples of activities are examples only. The assessing psychiatrist should take account of the person's cultural background. Consider activities that are usual for the person's age, sex and cultural norms."
The Panel noted the reliance on histories taken at various times by Dr Synnott in January 2013; Dr Ryan, the treating psychiatrist in December 2013; Dr Rastogi in August 2014; and the medical specialist on Mr Versace's clinical presentation in November 2015. The Panel accepted that the medical specialist's assessment had to involve clinical assessment on the day of the assessment and that consideration had to be given to activities usual for Mr Versace's age, sex and cultural norms.
The Panel then turned to the PIRS categories put in issue on appeal. It dismissed the appeal in relation to all of the challenged categories other than "concentration, persistence and pace", as to which it observed: "Concentration, Persistence and Pace 44. The AMS recorded that the Respondent worker reported as being forgetful of details of conversation, frequently repeating himself, misplacing personal belongings and that he could not "read beyond a paragraph before losing focus". He also noted that the Respondent worker was "currently sustaining around 20 to 25 hours per week in very basic customer service role in a real estate office" which seemed to be his full capacity. He undertook various cognitive tests which showed a degree of impairment in the interview situation which appeared to be stressful for the Respondent worker. 45. The AMS recorded when assessing the PIRS category: "poor performance on cognitive assessment; forgetful; difficulty persisting at tasks; unable to read beyond a paragraph". 46. The Panel also notes that the Respondent worker reports a prior love of reading the newspaper but the reason he does not do that anymore is because "it is full of death and shootings", not due an inability to concentrate or persist. 47. It is also noted that the Respondent worker's short statement of 27 May 2015 discloses he is currently working 14 to 16 hours per week but he struggles with motivation. He says his concentration is poor and memory is suffering, not being able to remember "the simplest things". 48. It is also noted that a rehabilitation report of Workers Health Centre dated 31 March 2014 describes assistance with "intensive job seeking activities" and that the Respondent worker had completed a real estate licencing course, paying the course fees himself. 49. The Panel also notes the history and opinions expressed by Dr Rastogi on 15 August 2014 (remaining aware that this was over 12 months prior to the AMS assessment). In particular, that the Respondent worker had been able to retrain and find a reasonable job which is described as being part-time in a real estate agency. Dr Rastogi believed the applicant had a good prognosis psychologically if a holistic approach was provided. She considered the Respondent worker unable to work in his premorbid role or hours due to the physical injury and the psychological injury, but a graded return would be suitable. Dr Rastogi believed that vocational rehabilitation and placement to help him engage in future employment to provide a protective factor for psychological recovery was warranted. She made specific recommendations as to the conduct of rehabilitation and retraining program and provided suggestions as to the type of jobs to which he may be able to return. She thought work as a service advisor or service manager in a car sales company or mechanic shop with minimal activity may be appropriate. 50. The treating psychiatrist, Dr Mark Ryan, also records that the applicant had begun working part-time as a real estate consultant, but does not record completion of the licencing course. On 17 April 2015 Dr Ryan recorded the Respondent worker working 32 to 38 hours per week around that time. 51. The Respondent worker submits that the evidence is more reflective of a Class 2 assessment in this category fitting comfortably within the example provided within the table as follows: "Mild impairment: can undertake a basic retraining course, or a standard course at a slower pace. Can focus on intellectually demanding tasks for periods of up to 30 minutes, then feels fatigued or develops headache." 52. The Respondent worker submits that the Respondent worker's presentation to other doctors is consistent with the MAC and, in any event, the assessments for physical injuries differ from assessment for psychological purposes. The submissions point to the Respondent worker's evidence in his statement outlined above. As a result, it is submitted that the AMS has accurately stated his reasoning to justify Class 3 and that the ground of appeal is not made out. 53. The Appellant employer submits that other matters may be relevant to the assessment of this category. It is submitted that the AMS notes in his report that the Respondent worker had been previously suicidal and researched methods for completed suicide on the internet, presumably suggesting a cognitive ability to persist with research. It is also submitted that there was "no specific cognitive assessment undertaken" by the AMS but this is clearly contrary to the report itself, as noted above, and the specific observation in the table in the MAC at 11.5. 54. It is also noted by the Appellant employer that other doctors take a "very detailed and comprehensive history of injury", presumably by implication submitting that there were no apparent issues relating the applicant's memory. 55. To qualify for Class 3, the presentation is to be consistent with the examples provided in the PIRS table containing the following descriptor: "Moderate impairment: unable to read more than newspaper articles. Finds it difficult to follow complex instructions (eg operating manuals, building plans), makes significant repairs to motor vehicle, type long documents, follow a pattern for making clothes, tapestry or knitting." 56. Whilst remaining aware that these categories are examples only, when assessing the Respondent worker's own evidence, together with the other evidence concerning the completion of a real estate licencing course and his capacity to hold down a job, albeit part-time within a real estate environment, the Panel is satisfied that the AMS has erred when assessing the applicant as a Class 3 within the category for 'Concentration, Persistence and Pace'. The respondent worker has demonstrated that he can undertake a basic refraining course, or perhaps more than a basic refraining course, by way of a real estate licencing course. Completing the course no doubt required a level of application requiring concentration and completion of assessments. He works for between 16 and 25 hours (encompassing the Respondent worker's evidence and that recorded by the AMS to expand the range of hours) and the Panel considers this inconsistent with an assessment of Class 3. 57. The reasons expressed for no longer reading the newspaper is also noted. 58. The Panel considers Class 2 to be the appropriate assessment."
The result of the Panel's conclusions was the finding that Mr Versace's gross impairment was 15%, reduced to 14% for the accepted one tenth reduction.

The Appeal Panel erred in its approach to its statutory task by conducting the assessment anew

In Attorney-General (NSW) v Quin it was observed at 35 - 36; [17]: "... The duty and jurisdiction of the court to review administrative action do not go beyond the declaration and enforcing of the law which determines the limits and governs the exercise of the repository's power. If, in so doing, the court avoids administrative injustice or error, so be it; but the court has no jurisdiction simply to cure administrative injustice or error. The merits of administrative action, to the extent that they can be distinguished from legality, are for the repository of the relevant power and, subject to political control, for the repository alone."
In this case, in resolving what lay in issue between the parties in relation to the grounds of appeal pursued before it, the Panel had a discretion as to whether or not to clinically examine Mr Versace itself. It was not asked to do so and decided itself that was unnecessary, given all of the materials before it. That being so and no other new evidence being received, given the provisions of s 328 and what was discussed in Siddik, the Panel had to confine itself to a determination of the matters raised on the appeal and if error was identified, to its correction. It could not simply undertake Mr Versace's assessment "anew".
Mr Versace's case was that not only did the Panel not so approach its task, the result of the approach it did adopt was that the medical specialist's examination was not given any weight, another substantial error of the kind discussed in House v R (1936) 55 CLR 499; [1936] HCA 40. In the result, the substitution of its own opinion for that of the medical specialist, was unreasonable and plainly unjust. This was also in issue.
The Panel certainly did not have before it any clinical notes of the medical specialist's examination of Mr Versace. The medical specialist referred, however, in his reasons to various of his observations and the results of his cognitive testing. Some of those observations were not referred to by the Panel in its reasons, although it said that it had taken the decision and attachments into account. The material to which the Panel did refer included the results of the cognitive testing.
Still, the Panel came to a different view to that reached by the medical specialist, as to the proper classification of the "concentration, persistence and pace" category on the evidence it discussed. That alone was not a basis on which it could substitute its opinion for that of the medical specialist. First it had to consider the alleged errors into which the medical specialist fell, identified at [35] in the written submissions filed with the notice of appeal in relation to the disputed category to be that '"on all available medical evidence the Appellant submits the assessment of concentration, persistence and pace is more reflective of Class 2 which is defined as Mild impairment". It was if the Panel accepted that the medical specialist had fallen into such error, that it had to determine what the correct classification was, as well as the impact of that conclusion on the assessment of Mr Versace's impairment.
The error in the Panel's approach is revealed by what it said at [24], as to the course it had pursued on the appeal, namely, that it had "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 worker." In pursuing that approach the Panel erred.
When considering the appeal as to the category self-care and personal hygiene, where it found that the medical specialist had not erred, (where the appeal ground pursued was summarised at [150] of the written submission to be that on all available medical evidence it was the assessment of Dr Rastogi which was reflective of the objective evidence before the medical specialist), the Panel observed: "39. When addressing the examples for either Class 2 or Class 3 under Table 11.1 the Panel considers that either Class 2 or Class 3 may have been available to the AMS depending on the clinical judgment on the day of assessment. While minds may differ on the matter, the Panel does not consider the allocation of a Class 3 for this category discloses an error. The Panel concludes this despite the assessment of Dr Rastogi of a Class 2 assessment urged upon the Panel by the Appellant employer."
The possibility of differing clinical judgments being available on the day of the assessment in relation to the "concentration, persistence and pace" category, was not alluded to by the Panel in its reasons. Given the nature of what was being assessed in respect of that category, that possibility was also obviously present. After all, the medical specialist's conclusions rested not only on written reports of other medical practitioners and medical records to which he referred, but also on the results of the cognitive testing he had administered and his own clinical examination of Mr Versace that day, as the Guides required. That was all part of the medical evidence raised by the ground of appeal relating to this category.
As a matter of clinical judgment on all of that material, the Panel may well have come to a different view as to the proper assessment of the concentration, persistence and pace category than that reached by the medical specialist, particularly given that it had not conducted its own clinical examination of Mr Versace. Without, however, considering and determining whether the medical specialist had fallen into the error alleged on the appeal, given all of the materials he had to consider, including his own clinical examination of Mr Versace, the Panel was not entitled to conduct the assessment of Mr Versace anew and then to substitute its own clinical judgment, for that of the medical specialist as to the classification of that category.
Having discussed the parties' respective cases, the Panel explained at [56] that it had concluded that "when assessing the Respondent worker's own evidence, together with the other evidence concerning the completion of a real estate licencing course and his capacity to hold down a job, albeit part-time within a real estate environment", it was satisfied that the medical specialist had erred. The only error it identified, however, was the conclusion as to the classification itself, namely Class 2, rather than Class 3 being the appropriate assessment.
The reason given for that conclusion was the "basic retraining course, or perhaps more than a basic retraining course, by way of a real estate licencing course" which Mr Versace had completed, which the Panel inferred had required a level of application requiring concentration and completion of assessments and his work for between 16 and 25 hours per week. Reference was also made to newspaper reading.
In so approaching its task, the Panel erred. The competing classifications provided by the PIRS for the "concentration, persistence and pace" category were: "Class 2 Mild impairment: can undertake a basic retraining course, or a standard course at a slower pace. Can focus on intellectually demanding tasks for periods of up to 30 minutes, then feels fatigued or develops headache. Class 3 Moderate impairment- unable to read more than newspaper articles. Finds it difficult to follow complex instructions (eg operating manuals, building plans), make significant repairs to motor vehicle, type long documents, follow a pattern for making clothes, tapestry or knitting"

The Guides required the assessment to have regard to Mr Versace's psychiatric symptoms; his diagnosis; the severity and possible duration of his impairment; his own description of his functioning limitations, as well as that of family members and others who may have knowledge of him; medical reports, feedback from treating professionals and results of standardised tests, including appropriate psychometric testing performed by a qualified clinical psychologist. Variations in the level of his functioning over time also had to be considered. In reaching his conclusions the Guides required the medical specialist to exercise his clinical judgment on the day of his examination and, by reference to the examples given, taking into account activities that were usual for Mr Versace's age, sex and cultural norms.
There was no suggestion that Mr Versace was an unreliable historian. He was an automotive engineer who had established and built up Australia's Best Tyres' business which he had sold but was still working in, when he was injured in 2012. On clinical assessment by the medical specialist in 2015 he was working up to 25 hours per week in a very basic customer service role for a real estate agency, after having earlier undertaken a retraining course, although he had received Dr Ryan's advice in April 2015 that he needed to reduce his hours to 16. Mr Versace reported being forgetful of details of conversations, frequently repeating himself, misplacing personal belongings and not being able to read beyond a paragraph before losing focus.
The cognitive testing the medical specialist administered revealed a degree of impairment in the interview situation, which the medical specialist observed appeared to be stressful. He found Mr Versace's performance on cognitive assessment to have been poor, as well as forgetfulness, difficulty persisting at tasks and being unable to read beyond a paragraph. Because the Panel did not conduct its own clinical examination, it had to take these results and findings into account, in determining not only whether the medical specialist had fallen into the alleged error, but also if he had, whether that error had an impact on the conclusions which he had reached as to the correct classification of this category.
Allianz Australia Insurance Ltd v Rutland [2015] NSWCA 328 is an example of such an approach being pursued. There an application to set aside a medical assessment of a review panel of medical assessors undertaken under s 63 of the Motor Accidents Compensation Act 1999 (NSW) which had been granted by Garling J, arose for consideration. In that case the Panel was obliged to consider whether certificates issued by the original assessor should be confirmed or revoked, on the basis of a new assessment, not by way of correction of error (see at [18]). A similar PIRS impairment scale had to be considered.
It was concluded at [28] that instead of undertaking its own assessment, this review panel had reviewed the original decision for error, which was not its statutory task. An example given at [29] was in relation to the concentration, persistence and pace category, where the Panel had concluded that the assessor had taken account what it considered to be an irrelevant matter, namely forgetfulness. The Panel had then proceeded on the basis that if the finding of forgetfulness in Dr Jager's assessment was discounted, the respondent's capacity to perform her work duties could be assumed.
At [30] it was observed: "30 The Review Panel's assessment was to be made with the benefit of Dr Jager's report, as well as all the material that was before him: MA Guidelines, cl 16.19. As Giles JA explained in McKee at [23], the "plain purpose of s 63" of the MAC Act is to empower the Review Panel to apply its "collegiate professional expertise" to an assessment in the same way that the single assessor had done before them. This cannot occur where the Review Panel gives primacy to the assessment under review in the sense of assuming that, where error is shown in the reasons of the original assessor, there is no need for further consideration of or resort to the underlying factual material beyond that identified in the original assessor's reasons. There may be other material, not expressly identified by that assessor, which nonetheless supports his or her conclusions. Alternatively, having examined all the same material as the original assessor, the Review Panel may reach a different clinical opinion."
By way of comparison, in Mr Versace's case, the Appeal Panel's role was not to approach the appeal in the same way as the medical specialist had to approach Mr Versace's assessment. Rather, this Panel had to conduct the appeal under a statutory scheme which required that unless it received new evidence, its consideration of the grounds of appeal had to be confined to the identification and correction of error on the part of the medical specialist, as explained in Siddik.
Not having received new evidence, the Panel was not entitled, as it explained at [24] of its reasons it had done, to review the material before it and to reach its own conclusions "concerning the correct assessment of the impairments and losses" Mr Versace had suffered. Nor could it conclude, if it came to a different view to that reached by the medical specialist, having undertaken that exercise, that the medical specialist must have erred.
What the Panel rather had to do in relation to each of the matters raised on the appeal was to begin as the Panel in Rutland did, namely, by examining the relevant material and the medical specialist's reasons to determine whether he had fallen into the errors alleged under s 32(7)(3)(c) and s 327(3)(d).
On this appeal, if any of the alleged errors in the assessment of the classification of the challenged categories was identified, the Panel then had to consider what impact, if any, that error had on the assessment of Mr Versace's impairment. It was only if the result of that exercise was both a conclusion that the medical specialist had erred as to the proper classification of some or all of the categories put in question by the appeal and also that a different percentage total impairment had been suffered by Mr Versace to that determined by the medical specialist, that a new certificate should have been issued by the Panel.
In Roads and Maritime Services v Rodger Wilson [2016] NSWSC 1499, Fagan J recently considered a case where an Appeal Panel had correctly concluded that the medical specialist had erred in failing to consider an applicable part of the Guides, which dealt with the consequences of Ankylosis. What that Panel failed to do, however, having identified that this was an error which did have an impact on the assessment of the injury to the ankle there in question, was itself then to apply the applicable Guides to assess the impairment resulting from the injury, which in that case required consideration to be given to any contribution to the assessed whole person impairment derived by application of the WorkCover Guides, which should be attributed to pre-existing injury.
As Fagan J discussed, if a ground of appeal raised by an appellant has been made out, error having been identified which has had an impact on the proper assessment of the impairment, in issuing its new certificate the Panel must have regard to all of the applicable Guides, in arriving at a basis for that certificate, which will stand in place of that issued by the medical specialist.
As his Honour explained, it is in undertaking that task that a Panel has to consider all of the matters before it, relevant to the assessment of the impairment resulting from the injury in question. This requires that consideration be given both to the matter in respect of which a Panel has found error and to the other aspects of the medical specialist's assessment, which are not been put in issue on the appeal, or in respect of which error is not found, as well as matters which a medical specialist did not have to consider, because of the error into which he or she fell, in arriving at a conclusion as to the extent of the impairment.
This was not the approach which the Panel pursued in Mr Versace's case. It did not begin by considering and resolving the issues lying between the parties over the errors it was alleged, on the appeal, the medical specialist had fallen into. Rather, having itself reviewed the materials to arrive at its own conclusions as to Mr Versace's "impairments and losses", it concluded that the medical specialist must have erred as to the proper classification of the "concentration, persistence and pace" category, given the different conclusion it had arrived at, having considering that material for itself.
In the result it must be accepted that the Panel fell into error of a kind which is amenable to review in proceedings such as this. It had to determine the appeal brought from the medical specialist's assessment, in accordance with the limitations imposed upon it by this statutory scheme. In this case its statutory task was not simply to undertake anew the assessment that the medical specialist had been required to undertake to resolve the medical dispute lying between the parties, in order to resolve the matters raised by this appeal.
The Panel's error was not simply the result of it reaching a different conclusion to that arrived at by the medical specialist, as to the merits of what the parties had joined issue over, a matter which this Court could not review under s 69 of the Supreme Court Act. Rather, its error was the result of the Panel's erroneous approach to its resolution of the matters raised by the appeal, which had the result that it failed to perform its statutory function, concerned as that was in this case with the identification and correction of error. That is an error which this Court has power to address under s 69.
Accordingly, the orders sought must be made.

Was Mr Versace denied procedural fairness?

What procedural fairness requires in a particular case depends on the statutory power being exercised. The concept is essentially concerned with questions of practical justice (see Frost v Kourouche (2014) 86 NSWLR 214; [2014] NSWCA 39 at [41]).
In Minister for Immigration and Citizenship v SZGUR (2011) 241 CLR 594; [2011] HCA 1, French CJ and Kiefel J considered, at [9], that procedural fairness requires a decision-maker both to identify for the affected person any critical issue not apparent from the nature of the decision, or the terms of the statutory power and also to advise that person of any adverse conclusion which would not obviously be open on the known material. Otherwise the decision maker is not required to expose either thought processes, or provisional views for comment, before a decision is made.
In Rutland there was also an issue as to whether the review panel should have itself examined the respondent, neither party having sought such an examination. It was held that Garling J had not erred in concluding that the obligation to provide procedural fairness did not necessarily require the panel to examine the respondent, but it did, however, require the panel to give her the opportunity to address it, on whether the inference it proposed to draw about an aspect of her functional impairment was available on the facts as they were at the time it undertook its assessment, given the conflicting material before it and its decision not to conduct its own clinical examination.
This is a similar case.
Here the Panel also had a discretion to examine Mr Versace itself, which it did not exercise, the parties not having sought an examination, and it being of the view that there was sufficient material to determine the matters raised on the appeal, without further examination. It did not revisit that decision, even though there was obviously room for different conclusions to be reached, on the material before it, as to the proper classification of the various categories raised on the appeal and where the medical specialist had had the advantage of having examined Mr Versace.
Nor did it consider it necessary to examine Mr Versace when it came to the view that he might have been wrongly classified in respect of the "concentration, persistence and pace" category, it having wrongly undertaken the assessment the medical specialist had conducted anew, as I have explained, rather than confining itself to the consideration, identification and correction of error on the medical specialist's part, as it was obliged to do.
The medical specialist's conclusions on the "concentration, persistence and pace" category had rested on an acceptance of Mr Versace's reports about his state on examination, which were accepted to be consistent with medical reports in evidence, as well as with the results of his clinical examination and the cognitive testing the medical specialist then administered.
While the appeal in relation to the "concentration, persistence and pace" category was concerned with alleged error as to 'all available medical evidence' which it was submitted were "more reflective of Class 2 which is defined as Mild impairment Panel", the Panel's own conclusions as to the correct classification of this category rested not on the available medical evidence, but rather on certain assumptions it made and inferences which it drew, which the medical specialist had not made or drawn.
Those assumptions related to the nature of the retraining course which Mr Versace had earlier completed, namely that it required a particular level of application and that it required certain concentration and completion of assessments. The inferences which it drew related to what his work at the real estate agency involved. It was its conclusions as to these matters which led the Panel to the view that the medical specialist had wrongly classified Mr Versace as Class 3 in the concentration, persistence and pace category, even though there was little evidence about what the course Mr Versace had completed involved, or about the nature of Mr Versace's duties, or his ability to perform them.
The Panel did not give Mr Versace the opportunity to address it on any of these matters.
The Panel's assumptions and inferences appeared to be inconsistent with recent medical reports in evidence as to Mr Versace's declining capacity; Mr Versace's own report, which included that, for example, he was forgetful and could not read beyond a paragraph, before losing focus and that his work involved very basic customer service; with the results of the medical specialist's examination of Mr Versace; and with the results of his cognitive testing, which objectively showed the state of aspects of his impairment, at the time of that testing.
While in resolving what lay in issue between the parties the Panel was entitled to give particular evidence different weight to that which the medical specialist gave that evidence, even giving it no weight (see Allianz Australia Insurance Ltd v Cervantes [2012] NSWCA 244 at [16]), it had to ensure that it gave Mr Versace procedural fairness. Given that it had embarked on a course which departed from the resolution of the matters raised on the appeal, to one which involved undertaking its own assessment of his "impairments and losses" and its conclusions on the correct classification of the "concentration, persistence and pace" category resting as they did on the basis of the assumptions it made and the inferences which it drew, in relation to matters about which there was little evidence, Mr Versace had to be given the opportunity to address these matters.
Had the Panel, itself examined Mr Versace, it could have raised the matters about which it made assumptions and drew inferences with him. In that event it could have conducted his assessment anew, the medical specialist members of the Panel exercising the powers granted them by s 324(3).
Having not done so, like in Rutland, procedural fairness required the Panel to give Mr Versace the opportunity to deal with the critical assumptions and inferences on which its conclusions rested, before it came to its decision. That was because the Panel's approach involved it drawing adverse conclusions about the correct classification of the "concentration, persistence and pace" category, on a basis which would not obviously have been open on the material on which the Panel's conclusions had to be arrived at in relation to this ground of appeal (see Minister for Immigration and Citizenship v SZGUR (2011) 241 CLR 594; [2011] HCA 1). There was, in fact, but little evidence about the matters on which the Appeal Panel's decision turned, hence the need for it to make such assumptions and to draw such inferences. If Mr Versace was to be given the procedural fairness he was entitled to receive, he had to be given an opportunity to address these matters.
Accordingly, it must be accepted that by the approach it adopted, the Panel did deny Mr Versace procedural fairness. That, too, is a basis on which the orders sought must be made.

Orders

In the result the orders sought must be made. The usual order as to costs in these circumstances is an order in favour of Mr Versace for costs as agreed or assessed. Unless the parties approach within 14 days, that will be the Court's order.
Otherwise, I order that : 1. The Appeal Panel's medical assessment certificate and statement of reasons of 4 February 2016 be set aside. 2. The matter be referred to the Workers Compensation Commission of NSW for the appointment of a new Appeal Panel to consider the appeal from the medical specialist's certificate afresh, in accordance with law.

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: 02 November 2016

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