Zoric v Secretary, Department of Education & Ors

Introduction

1. This application for judicial review principally relates to the manner in which cl 1.32 of the NSW workers compensation guidelines for the evaluation of permanent impairment (fourth edition) ('the Guidelines') was applied to the claim for permanent impairment compensation made by Venessa Zoric ('the plaintiff').
2. The plaintiff's essential contentions are that a Medical Appeal Panel of the Personal Injury Commission ('the Appeal Panel') erroneously failed to apply, or failed to correctly apply, cl 1.32 when determining the plaintiff's whole person impairment ('WPI') and, further, that legally insufficient reasons were given in relation to the way that clause was dealt with by them. The plaintiff seeks a declaration to that effect, an order in the nature of certiorari quashing the decision, and the remittal of the matter to the Personal Injury Commission ('the Commission') to be determined in accordance with law.
3. The Secretary, Department of Education ('the first defendant') is the only active defendant in the proceedings. The Appeal Panel and the President of the Personal Injury Commission have each filed submitting appearances.

The nature of the claim: an overview

1. In late 2017, the plaintiff commenced employment as a teacher with the first defendant. Initially, she was classified as a provisional teacher, but from early 2018, her position was as a special education teacher.
2. In the course of that work, the plaintiff alleges that she suffered psychiatric injury. In the Application to Resolve a Dispute filed with the Commission, dated 18 February 2022, the plaintiff described that injury in these terms: "Complex Post-Traumatic [Stress] Disorder, Dissociative Personality Disorder and Chronic Persistent Adjustment Disorder with anxiety".
3. The deemed date of injury is accepted to be 14 September 2020.
4. On 18 October 2021, the plaintiff made a claim for permanent impairment compensation pursuant to s 66 of the Workers Compensation Act 1987 (NSW) ('the WCA'): the plaintiff sought the amount of $43,840 in respect of a 17% WPI.
5. By notice issued pursuant to s 78(1) of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ('the WIM Act') dated 4 February 2022, the insurer for the first defendant disputed the plaintiff's entitlement to compensation in respect of a 17% WPI. In disputing the plaintiff's claim, the first defendant's insurer relied upon an opinion by a psychiatrist who they had qualified (Dr Graham Vickery) to the effect that the plaintiff did not suffer from any "whole person impairment which results from the workplace injury on 14 September 2020".
6. Her claim being in dispute, the plaintiff filed an Application to Resolve a Dispute with the Commission dated 18 February 2022. That application identified two matters in dispute - being liability and the degree of permanent impairment.
7. On or around 24 February 2022, the first defendant filed a Reply to Application to Resolve Dispute with the Commission.
8. On 21 July 2022, the Commission made orders, by and with the consent of the parties, that "remitted" the matter to the President for referral to a medical assessor for an assessment of whole person impairment in relation to a "[p]rimary psychological injury". The medical assessor appointed was Dr Graham Blom, psychiatrist.

The medical assessment of the plaintiff

1. On 12 December 2022, the plaintiff was assessed by Dr Blom, following which he issued a medical assessment certificate dated 10 January 2023.
2. By that certificate, Medical Assessor Blom diagnosed the plaintiff as suffering from "Complex Post-Traumatic Stress Disorder/Borderline Personality" and "[p]olysubstance abuse". He assessed the plaintiff as suffering from a 15% WPI but, given the plaintiff's history, made "a deduction of 25%", pursuant to s 323 of the WIM Act, to reflect the fact that the plaintiff suffered from "pre-existing disorders in multiple areas of [her] functioning".
3. It is relevant to note, given the centrality of this issue on the current application, that the medical assessor did not address the terms of cl 1.32 of the Guidelines.

The appeal to the Appeal Panel

1. On or around 3 February 2023, the plaintiff filed an Appeal Against a Decision of a Medical Assessor. The grounds of appeal were two: first, that the "assessment was made on the basis of incorrect criteria"; and, secondly, that the "medical assessment certificate contains a demonstrable error".
2. The plaintiff filed written submissions in support of that appeal dated 3 February 2023. Those submissions identified, more particularly, the basis for each ground: 1. In relation to the first ground, this was confined to an error described as a failure "to make allowance for [the] effects of treatment". The plaintiff argued that the medical assessor "has not made the necessary allowance for the effects of treatment, or alternatively has not provided adequate reasons for doing so": more specifically, the plaintiff argued that the medical assessor "did not engage [in the] exercise required by the Guidelines, namely he does not consider whether the [plaintiff's] impairment would increase were her treatment withdrawn". 2. In relation to the second ground, this was confined to an error said to be "[i]nconsistent reasoning with respect to [the] application of [the] deduction under [s]ection 323". The plaintiff argued a number of matters in connection with this ground: that the medical assessor's reasons on the issue of the deduction under s 323 were "contradictory" - said to be evident by the fact that the medical assessor made a finding, on the one hand, that the "statutory deduction is warranted", but later acted inconsistently with this by deducting a greater percentage for the pre-existing disorder; and that the deduction of 25% was "excessive".
3. The first defendant, on or around 27 February 2023, filed a Notice of Opposition Appeal Against Decision of Medical Assessor with the Commission.
4. The first defendant also filed written submissions dated 27 February 2023. By those submissions, the first defendant opposed the appeal, and argued that the medical assessment certificate dated 10 January 2023 "be confirmed".
5. In relation to the plaintiff's first ground of appeal, the essential argument of the first defendant was that the preconditions to the engagement of cl 1.32 of the Guidelines had not been met - namely, there had not been "effective long-term treatment" resulting "in apparent substantial or total elimination of the claimant's permanent impairment". In relation to the plaintiff's second ground of appeal, the essential argument of the first defendant was that, given there was "little doubt a deduction [was] appropriate", whether a deduction of 25% or 10% was made "would still result in an assessment at less than 15% WPI".
6. On 20 March 2023, a delegate - after noting that the plaintiff advanced two grounds in support of her appeal (that the assessment was made on the basis of incorrect criteria (s 327(3)(c) of the WIM Act) and that the medical assessment certificate "contains a demonstrable error" (s 327(3)(d))) - made the following determination: I am satisfied that a ground of appeal as specified in section 327(3)(d) is capable of being made out. I am satisfied that the [plaintiff's] argument that the Medical Assessor erred when applying section 323 of the 1998 Act by failing to provide consistent reasons in his assessment of the [plaintiff's] impairment is capable of being made out.
7. Having made that finding, the delegate "referred" the appeal to a Medical Appeal Panel.

The decision of the Appeal Panel

1. Although it will be necessary, in order to deal with the issues raised in the further amended summons, to return to some of the detail of the Appeal Panel's reasons, it is sufficient, for present purposes, to note the following summary of the grounds of appeal (and arguments in support of those grounds) and the key conclusions reached when dealing with them.
2. The Appeal Panel noted that the plaintiff advanced two grounds of appeal, which may be summarised as being that the medical assessor "erred in failing to make any allowance for the effects of treatment, and applied inconsistent reasoning with respect to the deduction he made pursuant to s 323" of the WIM Act (Appeal Panel reasons at [10]). To expand a little upon these grounds, the first ground was directed to the proper application of cl 1.32 of the Guidelines, and the second ground was directed to the nature and extent of the deduction to be made for the pre-existing conditions applying s 323 of the WIM Act. As I have earlier noted, the plaintiff's application for judicial review in this Court is concerned only with the first ground advanced before the Appeal Panel.
3. In relation to the first ground of appeal, being the ground directed to cl 1.32 of the Guidelines, the Appeal Panel accepted the plaintiff's submission that the medical assessor "did not consider whether the [plaintiff's] impairment would increase were her treatment withdrawn, as required by the Guidelines" (Appeal Panel reasons at [25]).
4. Having accepted that the medical assessor was in error in failing to address cl 1.32 of the Guidelines, and by way of broad summary, the Appeal Panel sought to address its terms. Relevant to the engagement of cl 1.32, the Appeal Panel found: (a) that the plaintiff "is undergoing an extensive treatment regime" (Appeal Panel reasons at [27]); (b) the history taken by the medical assessor "does reflect an improvement" in the plaintiff's condition "as a consequence of treatment" (Appeal Panel reasons at [32]); (c) an "improvement per se is not sufficient to satisfy the requirements" of cl 1.32; rather, it is necessary "that the treatment results in 'apparent substantial or total elimination of the claimant's permanent impairment'" (Appeal Panel reasons at [33]); that "the evidence does not support" a finding that the plaintiff has "demonstrated an elimination of her WPI that could meet the definition of 'substantial'"; and that with "such a significant permanent WPI still remaining despite this treatment", there was not apparent substantial elimination of the plaintiff's permanent impairment (Appeal Panel reasons at [34] and [35]).
5. Thus, in relation to this ground of appeal, although the medical assessor did not consider whether the plaintiff was likely to revert to "the original degree of impairment if treatment is withdrawn" (within cl 1.32), the Appeal Panel did "not accept that he has erred in failing to make an allowance for the effects of treatment for the reasons stated above" (Appeal Panel reasons at [36]).
6. In relation to the second ground of appeal, the Appeal Panel agreed "with the thrust" of the plaintiff's submissions (Appeal Panel at [38]), and that the medical assessor fell into error when considering the extent to which any permanent impairment was "due" to any pre-existing injury, condition or abnormality.
7. The Appeal Panel considered that the medical assessor made a number of errors, including: (a) the medical assessor "has focussed [sic] too heavily on the circumstances surrounding her condition in her 20's", and any substance abuse had been in remission, and "remained so at the time of his assessment" (Appeal Panel reasons at [46]); and (b) despite the plaintiff being diagnosed with ADHD, the plaintiff "was able to obtain employment as a teacher" (Appeal Panel reasons at [47]).
8. The Appeal Panel then dealt with the "deduction" in the following terms (Appeal Panel reasons at [50]): Having carefully considered both parties' submissions, and the totality of the evidence we consider that a deduction is warranted, but we are satisfied that a one-tenth deduction is appropriate for the reasons outlined above.
9. Given the above findings and conclusions, the Appeal Panel, by determination and reasons dated 24 May 2023, "revoked" the medical assessment certificate issued on 10 January 2023 and issued a "new" one. By that certificate, the Appeal Panel accepted that the plaintiff suffered from a 15% WPI, but deducted 10% under s 323 of the WIM Act (this deduction representing the proportion of permanent impairment due to a pre-existing injury, abnormality or condition) - resulting in a 14% WPI.

Injury causing permanent impairment

1. Where a worker suffers an injury that results in a degree of permanent impairment, there may be an entitlement to compensation for that permanent impairment (in addition to any other compensation payable).
2. The degree of permanent impairment that results from an injury is to be assessed in accordance with s 65 of the WCA and Chapter 7, Part 7 of the WIM Act: s 65(1) of the WCA. For permanent impairment compensation to be payable in respect of a primary psychological injury (the nature of the plaintiff's injury), "the degree of permanent impairment resulting from the primary psychological injury" must be at least 15%: s 65A(3) of the WCA.

Medical assessment and medical disputes

1. Chapter 7, Part 7 of the WIM Act deals with medical assessment of medical disputes. Relevantly here, where the degree of permanent impairment resulting from an injury is disputed between the parties to a claim, it constitutes a "medical dispute": s 319(c) of the WIM Act. A medical dispute "has the meaning given by section 319": s 4(1) of the WIM Act.
2. The medical dispute arising may be referred for medical assessment: s 321 of the WIM Act.
3. The referral of the medical dispute is to a medical assessor: ss 4(1), 321(1) and (2) of the WIM Act. A medical assessor "means a person appointed under the Personal Injury Commission Act 2020 (NSW) as a medical assessor for the purposes of this Act": s 4(1) of the WIM Act.
4. Here, the medical dispute was about the plaintiff's degree of permanent impairment, and that medical dispute was referred to a medical assessor - Medical Assessor Blom.

Medical disputes: assessment of impairment

1. The assessment of the degree of permanent impairment of an injured worker is to be assessed in accordance with the Workers Compensation Guidelines: s 322(1) of the WIM Act. That section is in the following terms: (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.
2. The guidelines relating to "the assessment of the degree of permanent impairment of an injured worker as a result of an injury" are issued under s 376(1)(a) of the WIM Act (see also s 4(1) of the WIM Act and the definition of 'Workers Compensation Guidelines' contained therein). Those guidelines are described as: 'NSW workers compensation guidelines for the evaluation of permanent impairment', Fourth edition (previously referred to as 'the Guidelines'). The relevant parts of the Guidelines are addressed in [43]ff, below.
3. Section 323 of the WIM Act deals with deductions for any proportion of impairment that is due to a previous injury or pre-existing condition or abnormality. Sections 323(1)-(3) provide: 323 Deduction for previous injury or pre-existing condition or abnormality (1) In assessing the degree of permanent impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury (whether or not it is an injury for which compensation has been paid or is payable under Division 4 of Part 3 of the 1987 Act) or that is due to any pre-existing condition or abnormality. (2) If the extent of a deduction under this section (or a part of it) will be difficult or costly to determine (because, for example, of the absence of medical evidence), it is to be assumed (for the purpose of avoiding disputation) that the deduction (or the relevant part of it) is 10% of the impairment, unless this assumption is at odds with the available evidence. (3) The reference in subsection (2) to medical evidence is a reference to medical evidence accepted or preferred by the medical assessor in connection with the medical assessment of the matter. (4) … (5) (Repealed)
4. Section 324 deals with powers of a medical assessor on assessment: ss 324(1) and (2). The sections apply "to the assessment of a medical dispute in the course of an appeal…": s 324(3). A "medical assessor hearing the appeal… has all the powers of a medical assessor under this section on an assessment of a medical dispute": s 324(4).

Medical disputes: medical assessment

1. A "medical assessor to whom a medical dispute is referred is to give a certificate… as to the matters referred for assessment": s 325(1). The certificate is to certify the assessment, the reasons for assessment and the facts on which the assessment is based: s 325(2).
2. Section 326 deals with the status of a medical certificate issued under s 325(1). It provides: 326 Status of medical assessments (1) An assessment certified in a medical assessment certificate pursuant to a medical assessment under this Part is conclusively presumed to be correct as to the following matters in any proceedings before a court or the Commission with which the certificate is concerned - (a) the degree of permanent impairment of the worker as a result of an injury, (b) whether any proportion of permanent impairment is due to any previous injury or pre-existing condition or abnormality, (c) the nature and extent of loss of hearing suffered by a worker, (d) whether impairment is permanent, (e) whether the degree of permanent impairment is fully ascertainable. (2) As to any other matter, the assessment certified is evidence (but not conclusive evidence) in any such proceedings.

The Guidelines

1. The Guidelines deal with the evaluation of permanent impairment.
2. Part 2 of the Introduction to the Guidelines deals with "some key principles of permanent impairment assessments" - specifically, general assessment principles applicable when applying the Guidelines in assessing permanent impairment resulting from a work-related injury or disease. One such general principle relates to: 'Adjustment for the effects of treatment'. Three such principles are referred to, one of which is cl 1.32. That clause provides: Where the effective long-term treatment of an illness or injury results in apparent substantial or total elimination of the claimant's permanent impairment, but the claimant is likely to revert to the original degree of impairment if treatment is withdrawn, the assessor may increase the percentage of WPI by 1%, 2% or 3%. This percentage should be combined with any other impairment percentage, using the Combined Values Chart. This paragraph does not apply to the use of analgesics or anti-inflammatory medication for pain relief.
3. Given the issues that arose before the Appeal Panel, and the issue raised in the current application, it is worth emphasising the different subject matters of cl 1.32 and s 323. Although each concerns the assessment of the degree of permanent impairment resulting from an injury, they are directed to different situations that might arise in any claim for compensation for that permanent impairment. Thus, in relation to cl 1.32, it deals with when, and to what degree, a medical assessor can adjust by way of increase the percentage of WPI when treatment for the illness or injury giving rise to the permanent impairment results in apparent substantial or total elimination of it. And, in relation to s 323, it deals with when a medical assessor is to make a deduction for any proportion of the permanent impairment that is due to any previous injury or any pre-existing condition or abnormality: s 323(1). To the extent that determining the extent of the deduction "will be difficult or costly", it is to be assumed that the deduction is 10% of the impairment, "unless this assumption is at odds with the available evidence": s 323(2).

Medical disputes: appeals

1. Section 327 of the WIM Act deals with appeals against medical assessments. A party to a "medical dispute may appeal against a medical assessment under this Part, but only in respect of a matter that is appealable under this section and only on the grounds for appeal under this section": s 327(1).
2. Section 327(2) makes provision for what is "appealable" under s 327(1): A matter is appealable under this section if it is a matter as to which the assessment of a medical assessor certified in a medical assessment certificate under this Part is conclusively presumed to be correct in proceedings before a court or the Commission.
3. Section 327(3) of the WIM Act identifies the four permitted grounds of appeal: The grounds for appeal under this section are any of the following grounds- (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.
4. The first two grounds (ss 327(3)(a) and (b)) have been described as "remedial grounds", whereas the second two (ss 327(3)(c) and (d)) have been described as "error-based grounds": Sleiman v Gadalla Pty Ltd [2021] NSWCA 236 at [61].
5. Here, the grounds of appeal, as advanced by the plaintiff before the Appeal Panel, were confined to ss 327(3)(c) and (d) of the WIM Act - namely, errors in connection with cl 1.32 of the Guidelines and s 323 of the WIM Act.
6. An appeal is made by application to the President of the Commission and is not to proceed unless the President (or, relevantly here, his delegate) is satisfied that, on the face of the application and any submissions, "at least one of the grounds for appeal specified" in s 327(3) is "made out": s 327(4).
7. In relation to s 327(4), two matters should be noted. The first is that the section imposes a requirement on the President (or his delegate) not to assess "the correctness of the argument but simply [an assessment] that what has been put forward is arguable", in order for the appeal "to proceed": Ballas v Department of Education (2020) 102 NSWLR 783; [2020] NSWCA 86 at [72]. That state of satisfaction was reached, as I have earlier noted: see [20]-[21], above - albeit in connection with one ground only (the ground relating to s 323 of the WIM Act). The second is that, given that the delegate concluded that "at least one of the grounds of appeal specified" was made out, the Appeal Panel approached the matter on the basis that the appeal before it involved both grounds raised by the plaintiff. That appears to be the consequence of the direction within s 327(4): "…the appeal is not to proceed unless the President is satisfied that… at least one of the grounds for appeal specified" in s 327(3) "has been made out"; that is, so long as "at least one of the grounds for appeal" is arguable, then the entire appeal is to proceed. That, as I have said, was the approach of the Appeal Panel, and each party accepted that the Appeal Panel was correct in dealing with the appeal grounds in this way.
8. An appeal against a medical assessment is to be heard by an Appeal Panel constituted by two medical practitioners and one arbitrator: s 328(1) of the WIM Act. 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": s 328(2) of the WIM Act.

The plaintiff's grounds of review: introductory remarks

1. The plaintiff filed in Court by leave a further amended summons dated 16 February 2024 raising two conceptually distinct, but not unrelated, grounds - namely: 1. The Appeal Panel constructively failed to exercise its jurisdiction when determining the extent to which the plaintiff's permanent impairment had been improved by treatment in accordance with, and as required by, cl 1.32 of the Guidelines. 2. The Appeal Panel failed to give legally sufficient reasons when dealing with cl 1.32 of the Guidelines.
2. An error of the first type, which here is said to involve a failure by the Appeal Panel to apply the correct test under cl 1.32, would be a jurisdictional error (Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323; [2001] HCA 30 at [41]; Rodger v De Gelder (2015) 71 MVR 514; [2015] NSWCA 211 at [95]) and an error of law on the face of the record. An error of the second type would be an error of law on the face of the record (Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [28] ('Wingfoot')).
3. Before dealing with the grounds of review, two matters should be noted. The first is that the matter was argued by the parties on the basis that the Appeal Panel was required to apply cl 1.32 and that if, in doing so, it made an error of law (or jurisdictional error), then the plaintiff would be entitled to relief. I have proceeded on this basis. (Presumably, no submissions were made about this, that is a consequence not of the Guidelines, but the statutory directive in s 322 of the WIM Act). The second is that, given the approach of the parties, it is unnecessary to address whether, as the first defendant argued, the Guidelines had "the status of delegated legislation". In this respect, I would simply observe that, in the context of the guidelines issued under the "motor accidents legislation", doubt has been expressed about whether that characterisation is correct. Thus, in Ali v AAI Limited [2016] NSWCA 110 at [85], Leeming JA said, of the two guidelines issued under the Motor Accidents Compensation Act 1999 (NSW), that none of the statutory provisions under which those guidelines might issue "converts a guideline into delegated legislation which binds the parties or an assessor of its own force". See also AAI Ltd trading as GIO as agent for the Nominal Defendant v McGiffen (2016) 77 MVR 348; [2016] NSWCA 229 at [57].
4. As the plaintiff's application turns on the manner in which the Appeal Panel dealt with cl 1.32 of the Guidelines, it is appropriate to first address the terms of that clause, before setting out the reasons of the Appeal Panel and dealing with the plaintiff's grounds of review.

Clause 1.32 of the Guidelines

1. Clause 1.32 of the Guidelines is directed to adjusting the assessable permanent impairment to allow for the effects of treatment in defined circumstances: where there has been long-term effective treatment for an illness or injury that "results in apparent substantial or total elimination of the claimant's permanent impairment, but the claimant is likely to revert to the original degree of impairment if treatment is withdrawn". If these matters are demonstrated, then the assessor may "increase the percentage of WPI by 1%, 2% or 3%".
2. The clause may thus be understood to involve, and require findings about, the following "steps": 1. First, whether there has been effective long-term treatment of an illness or injury. 2. Secondly, whether that treatment results in apparent substantial or total elimination of the claimant's permanent impairment. 3. Thirdly, whether the claimant is likely to revert to the original degree of impairment if treatment is withdrawn.
3. These steps largely align with the analysis of Adamson J (as her Honour then was) in Peachey v Bildom Pty Ltd (Quality Siesta Resort Pty Limited and Quality Hotel) [2020] NSWSC 781 at [57] ('Peachey'), and both parties accepted that a proper application of cl 1.32 of the Guidelines requires these steps to be addressed.
4. Clause 1.32 is premised upon an illness or injury that results in permanent impairment. Each of the three steps are then directed to that condition. Upon satisfaction of each step, the medical assessor may increase the percentage of WPI by 1%, 2% or 3%. The present application does not involve any issue about the increase in the WPI percentage and, consistent with this, no submissions were directed to the proper construction of it - in particular, the meaning to be given to the term 'may' (broadly, whether it is discretionary or mandatory).
5. In relation to the first step, therefore, there needs to be a finding about the "illness or injury" that results in permanent impairment and whether there has been effective long-term treatment of that "illness or injury".
6. In relation to the second step, that enquiry involves a comparative exercise being performed, the nature of which was explained in Peachey at [52] as follows: Clause 1.32 requires a comparison to be made between the claimant's original degree of impairment as a result of the injury before the effective treatment and the claimant's degree of impairment as a consequence of treatment to determine whether the treatment has resulted in apparent substantial or total elimination of the original impairment. The comparison is to be made between the respective impairments at those two relevant times. I consider this construction to be clear from the wording of the clause…
7. Further, in relation to the comparative exercise required by cl 1.32, the clause neither requires, nor authorises, a comparison between respective WPI scores at those times, nor does there need "to be a post-injury pre-treatment WPI score for the purposes of undertaking the necessary comparison": Peachey at [53] and [56]. The explanation for this lies, at least in part, in the language of the clause: the focus of cl 1.32 is upon "permanent impairment", not on its degree expressed as a percentage: Peachey at [54] citing Hunter Quarries Pty Ltd v Mexon (2018) 98 NSWLR 526; [2018] NSWCA 178 at [67].
8. In relation to the third step, the question is whether the claimant's impairment is likely to revert to the original degree of impairment if treatment is withdrawn. Plainly, the resolution of this question is likely to be informed, perhaps significantly, by the findings in relation to the first and second steps.

The reasons of the Appeal Panel in connection with cl 1.32

1. The reasons of the Appeal Panel dealing with cl 1.32 are confined to 11 paragraphs. The relevant paragraphs are in the Appeal Panel's reasons at [25]-[36] and provide as follows: 25. We accept the appellant's submission that the Medical Assessor did not consider whether the appellant's impairment would increase were her treatment withdrawn, as required by the Guidelines. 26. Having said that, our task is to determine if the Medical Assessor erred in failing to make any allowance for the effects of treatment based on the whole of the evidence. 27. To begin with, it is clear that Ms Zoric is undergoing an extensive treatment regime, both in terms of medication and consultations with Dr Lim in particular. 28. As her treating general practitioner, he is in a good position to note the effects of treatment which, as the appellant points out, he has done in documenting an improvement in her function. 29. Dr Lim concluded that her treatment regime had resulted in a substantial improvement in her condition. 30. However, although the appellant had improved to the extent that she was able to resume work in 2022, she again relapsed and required further treatment. 31. As the Medical Assessor noted: "Diagnostically Ms Zorić currently suffers from a chronic and persistent Adjustment Disorder. Normally Adjustment Disorders should cease within six months of the cessation of the stressor but there have been multiple exposures, the most recent being the difficulties that she experienced while working in the Administrative Department at GPS." 32. The appellant conceded that despite her treatment regime Ms Zoric's functioning has fluctuated at times since her initial injury: the history taken by the Medical Assessor does reflect an improvement in the appellant's condition, as a consequence of treatment. 33. However, an improvement per se is not sufficient to satisfy the requirements of the Guidelines. The requirement for making such an adjustment is not that "the appellant's impairment has in some respects improved" but rather that the treatment results in "apparent substantial or total elimination of the claimant's permanent impairment". 34. Obviously the elimination has not been total. "Substantial" in general terms means significant, considerable or large and we are not persuaded that Ms Zoric has demonstrated an elimination of her WPI that could meet the definition of "substantial". 35. In our view, the evidence does not support such a finding. With such a significant permanent WPI still remaining despite this treatment this test is not met.
2. I turn now to address the plaintiff's grounds of review.

Ground 1: the Appeal Panel failed to determine the extent to which the plaintiff's permanent impairment had improved by treatment in accordance with cl 1.32 of the Guidelines

Introduction

1. By this ground of review, the plaintiff argues that the Appeal Panel failed to "determine the extent to which the plaintiff's permanent impairment had been improved by treatment in accordance with cl 1.32" of the Guidelines. This ground was largely, but not exclusively, directed to the second step required by cl 1.32.
2. For the purposes of this ground of review, the plaintiff accepted that the first step had been resolved favourably to the plaintiff. (The plaintiff took a not inconsistent position in connection with the way this step was dealt with for the purposes of whether the Appeal Panel gave sufficient reasons - there arguing it illustrated a shortcoming in them: see [84]ff, below). The submission in connection with the second step was essentially that the Appeal Panel failed to correctly approach, and therefore resolve, this step, including by its failure to undertake the comparative exercise required by cl 1.32.

Discussion and consideration

1. Before dealing with the detail of the plaintiff's submissions, the following three matters should be noted about the paragraphs of the Appeal Panel's reasons dealing with cl 1.32.
2. First, although the Appeal Panel set out the terms of cl 1.32 when it recorded the submissions made by the plaintiff on the appeal to it (Appeal Panel reasons at 24), it did not, however, separately identify the requirements of that clause. A clear statement in the reasons of a decision-maker of the statutory criteria to be applied serves a number of important functions but, critically, the direction tends to minimise the risk of error and consequent applications for judicial review: Dominice v Allianz Australia Insurance Ltd (2017) 81 MVR 249; [2017] NSWCA 171 at [12] ('Dominice'). Secondly, to the extent that the requirements of cl 1.32 were "paraphrased" by the Appeal Panel in its reasons at [25] - by its remark that the question raised by that clause was whether the plaintiff's "impairment would increase were her treatment withdrawn, as required by the Guidelines" - that remark can only be accepted to be a very "high-level" summary of the requirements of that clause. It should be emphasised that the "abandonment of the statutory language in favour of a paraphrase is to be deprecated", simply because of the risk of erroneously applying other than the statutory test: Dominice at [12]; IAG Ltd t/as NRMA Insurance v Chahoud [2019] NSWSC 767 at [65] ('Chahoud'). Thirdly, in relation to the Appeal Panel's reasons at [26], the remark that their task was to "determine if the medical assessor erred in failing to make any allowance for the effects of treatment based on the whole of the evidence" was, at least in one respect, curious: the Appeal Panel had already found error by the medical assessor failing to deal with cl 1.32 when assessing the plaintiff's degree of permanent impairment. Once error was found, the task of the Appeal Panel is not confined to determining whether the medical assessor "erred in failing to make any allowance for the effects of treatment based on the whole of the evidence", but to apply cl 1.32 themselves.
3. I turn now to address the arguments raised in support of, and against, this ground of review.
4. The plaintiff submitted that, notwithstanding that the Appeal Panel in its reasons at [33] noted that the "requirement for making… an adjustment" turns on whether "the treatment results in 'apparent substantial or total elimination of the [plaintiff's] permanent impairment'", it was nevertheless apparent from the reasons of the Appeal Panel that they failed to apply that direction. In this respect, the plaintiff's submissions were directed to the Appeal Panel reasons at [34] and [35], which provide: 34. Obviously the elimination has not been total. "Substantial" in general terms means significant, considerable or large and we are not persuaded that Ms Zoric has demonstrated an elimination of her WPI that could meet the definition of "substantial". 35. In our view, the evidence does not support such a finding. With such a significant permanent WPI still remaining despite this treatment this test is not met.
5. The plaintiff argued that these paragraphs reveal the error, and the flaw, in the approach of the Appeal Panel: it was submitted that, rather than undertake the comparative exercise required by cl 1.32 (and as explained in the decision in Peachey), the Appeal Panel embarked upon an erroneous approach that substantively focused upon the plaintiff's WPI.
6. The first defendant contested that the Appeal Panel fell into the error argued by the plaintiff, submitting that the Appeal Panel correctly directed itself in its reasons at [33] and, further, submitting that the finding by the Appeal Panel in the first sentence of its reasons at [35] demonstrate that the Appeal Panel simply found that the evidence did not support a finding that the second step had been satisfied. The first defendant also argued that, in substance, the plaintiff was impermissibly endeavouring to transform (viz., "dress up") what was fundamentally a factual issue, into a legal one.
7. I do not accept the first defendant's submissions. In my view, the Appeal Panel either failed to apply - or misapplied - the requirements of cl 1.32 of the Guidelines. That is for the following reasons.
8. First, the fact that the Appeal Panel gave itself a direction in the terms recorded in its reasons at [33] does not, in and of itself, demonstrate that the Appeal Panel correctly applied it. That is because formulaic or mere recitation of the test is neither sufficient nor decisive in determining whether the correct legal test has been applied; rather, whether the correct legal test has been applied is to be determined as a matter of substance, reading the reasons fairly and as a whole: Chahoud at [62].
9. Secondly, it is, to my mind, relevant to note that the Appeal Panel did not seek to define the various matters that would inform its ultimate holding on the second step: there is no reference to the decision in Peachey, nor any of the organising principles that guide the approach to the second step. I have earlier noted that, in fact, the Appeal Panel did not provide any clear statement (or direction) setting out the requirements of cl 1.32 more generally.
10. Thirdly, to the extent that it is evident what informed the Appeal Panel in determining that the plaintiff had not satisfied the second step, it was by reference to "WPI". This, in my view, is apparent from the two findings the Appeal Panel made about the plaintiff's WPI: the first was that they were unpersuaded that the plaintiff "has demonstrated an elimination of her WPI that could meet the definition of 'substantial'" (Appeal Panel reasons at [34]); the second was that with "such a significant permanent WPI still remaining despite this treatment this test is not met" (Appeal Panel reasons at [35]). Whilst it may be accepted that the degree of WPI was not irrelevant (it could be considered as part of the "qualitative and quantitative" assessment, as the plaintiff submitted), it was certainly not the sole consideration, nor a decisive one. To the extent that the Appeal Panel sought to introduce a definition of "substantial", I do not regard that as suggesting that the Appeal Panel properly considered the second step. In any event, I would simply observe that, from the structure of the reasons of the Appeal Panel, this definition was anchored to "elimination of her WPI". That, in my view, is simply not the correct enquiry required by cl 1.32.
11. In my view, the focus by the Appeal Panel upon WPI was erroneous. At a minimum, to focus, as the Appeal Panel did, upon the post-treatment WPI - without reference to the WPI which would have preceded that treatment - is, of itself, erroneous: logically, the post-treatment WPI could only ever be one part of the enquiry into whether there had been "apparent substantial…elimination"; the other part of that enquiry would require, as the plaintiff submitted, regard to be had to the "pre-treatment WPI". Separately, as was pointed out in Peachey at [56], cl 1.32 was not "intended to be satisfied by a mere mathematical comparison of assessments of % WPI at different times". Rather, what is required by cl 1.32, as the decision in Peachey emphasised, is a comparative exercise between the plaintiff's original degree of impairment before the "effective treatment" and the plaintiff's degree of impairment following that treatment: it is only by undertaking that comparison at those times can a medical assessor (or, in the present case, the Appeal Panel) determine whether the treatment "results in apparent substantial… elimination" of the plaintiff's permanent impairment. The Appeal Panel failed to undertake that task.
12. Fourthly, the first defendant sought to overcome the shortcomings in the way in which this issue had been dealt with by the Appeal Panel by emphasising the finding in the first sentence of the reasons of the Appeal Panel at [35] - viz., "the evidence does not support such a finding". The first defendant's essential submission was that this involved the Appeal Panel undertaking an analysis of the evidence, leading to the finding that it made - which was factual, insusceptible to judicial review and, in effect, provided a freestanding basis upon which to uphold the Appeal Panel's decision.
13. I am unable to accept that submission, for a number of reasons. One reason is that the finding is the product, as I have concluded, of a legal misdirection. In those circumstances, that factual finding, such as it is, cannot provide a separate and independent basis upon which to uphold the decision of the Appeal Panel. Another reason is that, in my view, the finding made by the Appeal Panel is more circumscribed than what was submitted. It was not, in my view, a general "no evidence" finding. Rather, having regard to the context in which it was made, the finding must be understood as one arising out of the Appeal Panel's consideration of WPI. That characterisation follows because the finding is made between two findings: immediately after the Appeal Panel made a finding that the plaintiff had not "demonstrated an elimination of her WPI" (Appeal Panel reasons at [34]) and immediately before the Appeal Panel made a further finding that with "such a significant permanent WPI still remaining despite this treatment", the "test" was not met (Appeal Panel reasons at [35]). Separately, I would also observe the following. If, as the first defendant argued, this was a broad "no evidence" finding made by the Appeal Panel (I emphasise, that is not, in my view, the proper way to understand the finding made by the Appeal Panel), then that finding sits, as the plaintiff submitted, inconsistently with an earlier finding that the Appeal Panel had made - namely, that "Dr Lim concluded that her treatment regime had resulted in a substantial improvement in her condition" (Appeal Panel reasons at [29]). To avoid that inconsistency, one is driven to conclude that the finding should be understood as being a more confined one, and linked to the Appeal Panel's consideration of the plaintiff's current WPI.
14. For those reasons, I would uphold the first ground of review of the further amended summons.

Ground 2: the Appeal Panel failed to give adequate reasons in connection with cl 1.32

1. By this ground, the plaintiff argued that the Appeal Panel failed to provide adequate reasons when dealing with cl 1.32 (further amended summons ground 2). Given the conclusion I have reached, this ground is very much a secondary one and - quite properly - less emphasis was placed upon it during submissions.

The relevant principles: the standard of reasons required

1. In Wingfoot, the High Court set out the following principles that relate to the standard of reasons required of an Appeal Panel (at [47], [54]-[56]): 47. … It goes too far, however, to conceive of the function of the Panel as being either to decide a dispute or to make up its mind by reference to competing contentions or competing medical opinions. The function of a Medical Panel is neither arbitral nor adjudicative: it is neither to choose between competing arguments, nor to opine on the correctness of other opinions on that medical question. The function is in every case to form and to give its own opinion on the medical question referred to it by applying its own medical experience and its own medical expertise. 54. The objective, within the scheme of the Act, of requiring the Medical Panel to give a written statement of reasons for that opinion can therefore be seen to be that persons affected by the opinion automatically be provided with a written statement of reasons adequate to enable a court to see whether the opinion does or does not involve any error of law. There is an obvious benefit in requiring a written statement of reasons for an opinion always to meet that standard. The benefit is that it enables a person whose legal rights are affected by the opinion to obtain from the Supreme Court an order in the nature of certiorari removing the legal effect of the opinion if the Medical Panel in fact made an error of law in forming the opinion: an error of law in forming the opinion, if made, will appear on the face of the written statement. To require less would be to allow an error of law affecting legal rights to remain unchecked. To require more would be to place a practical burden of cost and time on decision-making by an expert body for no additional legal benefit and no identified systemic gain. 55. The standard required of a written statement of reasons given by a Medical Panel under s 68(2) of the Act can therefore be stated as follows. The statement of reasons must explain the actual path of reasoning by which the Medical Panel in fact arrived at the opinion the Medical Panel in fact formed on the medical question referred to it. The statement of reasons must explain that actual path of reasoning in sufficient detail to enable a court to see whether the opinion does or does not involve any error of law… 56. … A Medical Panel explaining in a statement of reasons the path of reasoning by which it arrived at the opinion it formed is under no obligation to explain why it did not reach an opinion it did not form, even if that different opinion is shown by material before it to have been formed by someone else.
2. These general principles apply to the present statutory scheme: see, for example, Queanbeyan Racing Club Ltd v Burton [2021] NSWCA 304 at [42]; Lancaster v Foxtel Management Pty Ltd [2022] NSWSC 929 at [45] ('Lancaster').
3. It is to be remembered, however, that the adequacy of reasons must be evaluated in the context of what the Appeal Panel was asked to decide: "[n]o mechanical formula can be given for determining what constitutes sufficient reasons, but it is particularly important that a complaint that they are inadequate be assessed against the circumstances of the particular case": Sydney Trains v Batshon [2021] NSWCA 143 at [48]; see also Lancaster at [52]. Further, the reasons of an administrative decision maker should not be reviewed "minutely and finely with an eye keenly attuned to the perception of error": Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280, 287; [1993] FCA 456 at [22]; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259, 272.

Discussion and consideration

1. In relation to the adequacy of reasons, the plaintiff submitted, in substance, that they were palpably insufficient and failed to address most, if not all, of the steps involved in a proper application of cl 1.32. The first defendant submitted that the reasons of the Appeal Panel were, as a matter of substance, sufficient (even if brief) and made clear that they had considered the requirements of that clause: the first defendant emphasised that the standard of reasons was necessarily informed by the nature of the constitution of the Appeal Panel (two of its members being medical specialists).
2. The starting point for a consideration about the adequacy of the reasons is that the Appeal Panel's reasons "must be viewed in the particular context of the case": Lancaster at [52]. That context was the application of cl 1.32 of the Guidelines. The application of them required the Appeal Panel to address, and make findings about, each of the matters which that clause addresses and to explain "the actual path of reasoning" in sufficient detail so as to enable a court to determine whether, given the conclusion reached, it involved error of law or otherwise: Wingfoot at [55].
3. Put simply, insufficiency of reasons arises where a finding is made, but the basis for the finding is not explained, which can be contrasted with a situation where it is complained that no finding has been made: Waterways Authority v Fitzgibbon (2005) 79 ALJR 1816; [2005] HCA 57 at [129]-[130]; Resource Pacific Pty Ltd v Wilkinson [2013] NSWCA 33 at [42] ('Wilkinson'). An error of this last kind is not properly one relating to reasons, "but of a failure to address and determine a necessary issue": in circumstances where that finding is a necessary step in support of the decision, "the failure to make the finding may constitute an actual failure to exercise the jurisdiction conferred on the court, despite the appearance of exercise": Wilkinson at [42].
4. In my view, the following matters illustrate the inadequacy of the reasons given by the Appeal Panel, as well as its failure to address and determine a necessary issue in the sense discussed above.
5. First, there was at least a measure of uncertainty as to precisely what "illness or injury" was the subject of finding or acceptance by the Appeal Panel. In this respect, the plaintiff argued (consistent with the claim for compensation made, and the nature of the injury alleged to have been suffered) that the Appeal Panel must be taken to have found that the plaintiff suffered from a chronic and persistent adjustment disorder, as well as other conditions and ailments that were referred to by the medical assessor (and set out in the Appeal Panel reasons at [20]). The first defendant, on the other hand, submitted that the finding about the "illness or injury" was confined to a finding that the plaintiff suffered from a chronic and persistent adjustment disorder - which was consistent with what the Appeal Panel "noted" when it referred to the diagnosis to that effect made by the medical assessor: Appeal Panel reasons at [31]. Whether what was recorded by the Appeal Panel in its reasons at [31] was a finding about the plaintiff's "illness or injury" is not altogether clear because: (a) in the way that this issue was dealt with by the Appeal Panel, what was "noted" by the Appeal Panel is dealt with after the Appeal Panel apparently had dealt with whether there had been "effective long-term treatment" - thereby suggesting that what they had "noted" was directed to a different issue; and (b) relatedly, what is "noted" by the Appeal Panel can be consistently read with the Appeal Panel in fact dealing with the later issue about whether there had been substantial improvement and whether the plaintiff had "relapsed" - with the consequence that there had not been, or was unlikely to be, "apparent substantial… elimination" of the plaintiff's permanent impairment. It is, I consider, somewhat unfortunate that the reasons of the Appeal Panel do not clearly identify what was the "illness or injury" they were dealing with. The fact that, during the hearing, a considerable amount of time was spent arguing about this and that the parties took different views about what was found (or accepted) was, as the plaintiff submitted, a practical illustration of the limitations in the Appeal Panel's reasons on this issue.
6. Secondly, and putting to one side the issue about what "illness or injury" the Appeal Panel was in fact dealing with, in relation to the first step, it was necessary for the Appeal Panel to make a finding about whether there had been effective long-term treatment of an "illness or injury". In relation to this issue, the Appeal Panel did not make a finding in the terms required by cl 1.32: the only finding that it made was an intermediate one - namely, that the plaintiff "is undergoing an extensive treatment regime, both in terms of medication and consultations with Dr Lim in particular" (Appeal Panel reasons at [27]). Although both the plaintiff and first defendant proceeded on the basis that the Appeal Panel implicitly found the plaintiff's treatment to be "effective long-term treatment", the difficulty with, and shortcoming in, the reasons of the Appeal Panel is that absent clear identification of the "illness or injury" being treated and the identification of the precise nature and extent of the treatment provided, it is simply not possible to determine whether that treatment is "effective long-term treatment". The findings made about this issue would, I consider, also be relevant to the other steps required by cl 1.32. Findings of this kind are not mere formalities, but critical to the proper application of the clause.
7. In my view, even though it may be accepted that the Appeal Panel proceeded on the basis that "effective long-term treatment" had been established, the Appeal Panel simply did not explain, and make the necessary findings about, that matter. I consider the reasons of the Appeal Panel in this respect to be legally insufficient.
8. Thirdly, in relation to the second step - relevantly here, whether the treatment results in apparent substantial elimination of the plaintiff's permanent impairment - the reasons, in my view, evidence a clear failure to engage with the comparative exercise required, as earlier explained in connection with the first ground of the further amended summons. In that respect, the actual path of reasoning thus exposes error of law, in my view. The error may also be approached from another way: to the extent that the Appeal Panel undertook a limited examination of this issue, it did not explain, other than by reference to the post-treatment WPI, why this issue was resolved in the way that it was: see [79]-[82], above.
9. Separately, the plaintiff was critical of the Appeal Panel's consideration of the second step, submitting that its reasons were extremely confined and inadequate, being limited to three sentences: the second sentence of the Appeal Panel reasons at [34], and the two sentences of the Appeal Panel reasons at [35]. There is considerable force to this submission but, given what I have set out above and the conclusion that I have reached in connection with the first ground of appeal, this complaint does not materially add to the conclusions that I have reached.
10. In my view, for the reasons I have given, this ground should also be upheld.

Costs

1. The parties agreed that, irrespective of the orders made in connection with the further amended summons, there should be no order as to costs.
2. Given that agreement, that order should be made.

Orders

1. For the above reasons, I make the following orders: 1. Order in the nature of certiorari moving into this Court and quashing the certificate issued by the third defendants, constituting a Medical Appeal Panel of the second defendant, dated 24 May 2023. 2. Order that proceedings PIC matter number M1-W1068/22 is remitted to the second defendant to be determined according to law. 3. Make no order as to costs such that each party is to bear their own costs of and incidental to the proceedings in this Court.

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: 21 February 2024