Issue 10: October 2011
On Appeal
Welcome to the 10th issue of ‘On Appeal’ for 2011.
Issue 10 – October 2011 includes a summary of the September 2011 decisions.
These summaries are prepared by the Presidential Unit and are designed to provide
a brief overview of, and introduction to, the most recent Presidential and Court of
Appeal decisions. They are not intended to be a substitute for reading the
decisions in full, nor are they a substitute for a decision maker’s independent
research.
Please note that the following abbreviations are used throughout these summaries:
ADP
AMS
Commission
DP
MAC
Reply
1987 Act
1998 Act
2003
Regulation
2010
Regulation
2010 Rules
2011 Rules
Acting Deputy President
Approved Medical Specialist
Workers Compensation Commission
Deputy President
Medical Assessment Certificate
Reply to Application to Resolve a Dispute
Workers Compensation Act 1987
Workplace Injury Management and Workers Compensation Act 1998
Workers Compensation Regulation 2003
Workers Compensation Regulation 2010
Workers Compensation Commission Rules 2010
Workers Compensation Commission Rules 2011
Level 21 1 Oxford Street Darlinghurst NSW 2010 PO Box 594 Darlinghurst 1300 Australia
Ph 1300 368018 TTY 02 9261 3334 www.wcc.nsw.gov.au
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Table of Contents
Court of Appeal
Ayoub v AMP Bank Limited [2011] NSWCA 263 ............................................................... 3
WORKERS COMPENSATION - appeal - appeal against finding of the Acting Deputy President appeal limited to party being aggrieved by a decision of the Presidential member in point of law denial of procedural fairness - matter proceeded on the papers - failure to consider oral hearing
when matters of credit to be decided - whether parties acquiesced in review on the papers whether failure of Acting Deputy President to take into account internal retrenchment policies of
appellant constituted an error of law - no error shown - no denial of procedural fairness ............. 3
McCarthy v Patrick Stevedores No 1 Pty Ltd [2011] NSWCA 311 .................................... 7
Workers compensation – appeal against decision of Deputy President – limited to decisions in
point of law – whether there was a misapplication of s 40 of the 1987 Act – whether there was
evidence to support the Deputy President’s finding – whether there was a failure to give
adequate reasons – whether there was a denial of procedural fairness in making a determination
on the papers – no error in point of law .......................................................................................... 7
Presidential decisions
Awick v Formcorp Pty Ltd (No 2) [2011] NSWWCCPD 50 .............................................. 10
Estoppel; nature of issues in dispute in earlier proceedings between the same parties; whether
issue estoppel arose from earlier determination; whether worker had received a primary
psychological injury or secondary psychological injury; s 65A of the Workers Compensation Act
1987 .............................................................................................................................................. 10
Bricknell v TAC Pacific Pty Ltd [2011] NSWWCCPD 53 ................................................. 12
Injury; whether the worker was bitten by an insect in the course of employment; application to
rely on fresh evidence or additional evidence on appeal; s 352(6) of the Workplace Injury
Management and Workers Compensation Act 1998; failure to prepare objective chronology of
the principle events....................................................................................................................... 12
Nguyen v WorkCover Authority of New South Wales [2011] NSWWCCPD 55 .............. 14
Employment; identity of worker’s employer; whether employed by an individual or a partnership;
whether a partnership existed; credit findings; application of principles in Fox v Percy [2003]
HCA 22; 214 CLR 118 .................................................................................................................. 14
North Coast Area Health Service v Felstead [2011] NSWWCCPD 51 ............................ 17
Personal injury under s 10 of the Workers Compensation Act 1987; disease injury; personal
injury; journey incident; failure to give adequate reasons ............................................................ 17
Jetstar Airways Pty Ltd v Canterbury [2011] NSWWCCPD 54 ....................................... 22
Psychological injury; whole or predominant cause of injury; reasonable action taken with respect
to discipline; s 11A of the 1987 Act .............................................................................................. 22
East Coast Timber Products Pty Ltd v Hancock (No2) [2011] NSWWCCPD 48 ............ 24
Arbitrator erred in failing to give adequate reasons for his decision; determined on remitter from
the Court of Appeal....................................................................................................................... 24
Koutsioukis and Koutsioukis t/as Taste of Europe Bakery v Bouza
[2011] NSWWCCPD 52 ...................................................................................................... 27
Costs where appellants filed Election to Discontinue Proceedings; s 341 Workplace Injury
Management and Workers Compensation Act 1998 ................................................................... 27
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Ayoub v AMP Bank Limited [2011] NSWCA 263
WORKERS COMPENSATION - appeal - appeal against finding of the Acting Deputy
President - appeal limited to party being aggrieved by a decision of the Presidential member
in point of law - denial of procedural fairness - matter proceeded on the papers - failure to
consider oral hearing when matters of credit to be decided - whether parties acquiesced in
review on the papers - whether failure of Acting Deputy President to take into account
internal retrenchment policies of appellant constituted an error of law - no error shown - no
denial of procedural fairness
Basten JA, Whealy JA and Sackville AJA
7 September 2011
Facts:
Ms Ayoub was employed by AMP Bank Limited as one of three Product Managers. In 2007,
her work situation began to deteriorate.
Her manager was replaced with a new manager, Mr Slocombe, who she had worked with at
an earlier time and did not like. She perceived that he was critical of some aspects of her
work.
In her performance appraisal, her performance was graded as “satisfactory”. She ventilated
her dissatisfaction with this grade at a meeting in March 2007 with Mr Slocombe and AMP’s
Managing Director, Mr White. She later complained that she was very distressed by the
events that occurred at that meeting. Mr White maintained that “the tone of the meeting was
as friendly as I was able to make it”.
At that meeting she was informed by Mr White that “other people” had complained to him
about the inappropriateness of her dress and her behaviour on occasions at meetings.
From March to November 2007, she perceived that she was being bullied and harassed by
staff and treated unfairly and belittled by Mr Slocombe due to her race and gender.
In 2007, it was decided that a restructure of the business was necessary to make it more
efficient and effective. Ms Ayoub was unaware that there had been discussions at the
executive level about the prospect of having only two Product Managers. Ms Ayoub’s
position was made redundant on 15 November 2007. AMP tried, unsuccessfully, to redeploy
her within its structure and it made counselling available to Ms Ayoub. That night she sent an
email to Mr White complaining about the way she was treated at the performance appraisal
meeting on 14 March 2007. She then lodged a notification of injury which described injury as
“anxiety state/depression” and asserted that her employment was a substantial contributing
factor. Allianz denied liability and identified the following issues (at [12]):
(a) there was no evidence to confirm Ms Ayoub’s allegations of being subjected, by her
managers, to ongoing harassment, bullying and intimidation;
(b) according to Dr Ong, Ms Ayoub's general practitioner, she had recovered from any
distress caused by the “satisfactory” performance rating;
(c) Dr Ong opined that the distress suffered by Ms Ayoub as a result of her father’s
death in September 2007 had abated;
(d) certificates issued by Dr Ong noted that the events at work on 15 November 2007
caused anxiety and depression;
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(e) Ms Gurton, psychologist, opined that the adjustment disorder suffered by Ms Ayoub
was as a result of the redundancy;
(f) there was no evidence that AMP acted unreasonably in relation to the redundancy;
(g) AMP followed its policy in relation to the restructuring;
(h) a number of staff were made redundant following the restructure of AMP;
(i) counselling was made available, and
(j) there was minimal medical evidence in support of the alleged injury, incapacity and
need for treatment.
In proceedings commenced in the Commission, Ms Ayoub sought weekly benefits from 15
November 2007, medical expenses and lump sum compensation. The Arbitrator found in
Ms Ayoub’s favour after being impressed with her oral evidence in cross-examination and
accepting her as a credible witness. He found that (at [19] – [25]):
(a) she received a personal injury in the form of a psychological injury at the meeting on
15 November 2007;
(b) the injury, being a major depressive disorder, qualified as a “personal injury”;
(c) the injury arose out of or in the course of her employment;
(d) the injury was sustained because she had been called to a meeting without prior
consultation to inform her of her retrenchment;
(e) employment was a substantial contributing factor to her psychological injury, and
(f) in relation to the allegations of discrimination, the Arbitrator determined that a finding
was not necessary as other proceedings had been commenced in courts of different
jurisdictions and those courts were in a better position to determine those matters.
AMP appealed the Arbitrator’s determination. AMP accepted that Ms Ayoub had sustained a
psychological injury but challenged the finding that its actions in relation to the appraisal of
her performance, and in relation to retrenchment, were unreasonable [29] – [30]. AMP
submitted that there was “uncontested evidence” that the employer was obliged, for proper
reasons, to diminish its staff [31]. The Arbitrator’s decision was revoked and an award
entered for AMP (AMP Bank Ltd v Ayoub [2010] NSWWCCPD 37). Moore ADP found:
1.
she had sufficient information to proceed with the appeal ‘on the papers’ [39];
2.
there was no other evidence (beyond Ms Ayoub’s evidence) in support of her
allegations of discrimination. A witness who was described as her friend and colleague
had not supported her allegations of sexual harassment, racial discrimination or
bullying and described Ms Ayoub as having “issues with her perception of events” [43].
There were also other “conflicting statements” [44]. There was an absence of complaint
between 26 March and November 2007 and Dr Ong and Ms Gunton did not refer to
her being distressed over allegations of discrimination or harassment [43];
3.
that AMP’s actions in relation to the performance appraisal and the retrenchment were
reasonable [45];
4.
there was “nothing to suggest that either the steps taken to appraise Ms Ayoub’s
performance, or the manner in which the results were communicated to her was in any
way unreasonable” [46] – [47];
5.
there were four matters, as discussed in Manly Pacific International Hotel Pty Ltd v
Doyle (1999) 19 NSWCCR 181, that should be considered in determining whether a
retrenchment process had been unreasonable (at [48]):
i.
ii.
the general circumstances of the employment relationship between the
employer and employee;
the suddenness or otherwise of the “fall of the axe”;
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iii.
iv.
the period of notice given, and
the existence of counselling and other services provided at the time of
retrenchment, including consideration as to alternative employment.
Ms Ayoub appealed to the Court of Appeal and the issues for determination were (at [51]):
a) whether Moore ADP erred by denying Ms Ayoub procedural fairness by failing to
notify her that it was proposed to make a credit finding against her;
b) whether Moore ADP considered whether she had sufficient information to proceed to
a final determination ‘on the papers’ especially having regard to the decision to
reconsider the credit findings of the Arbitrator;
c) if Moore ADP did give consideration to the form of the hearing, whether it was
reasonably open to her to be satisfied that she had sufficient information to proceed
‘on the papers’, and
d) whether Moore ADP erred in failing to take into account AMP’s industrial policies and
generally accepted standards of conduct in the workplace relating to redundancies.
Held: Appeal dismissed with costs (Basten JA, Whealy JA and Sackville AJA
agreeing)
Procedural fairness
1.
Procedural fairness must be afforded to parties in the hearing of a review under s 354
of the 1998 Act (see the decision of Basten JA in State Transit Authority of New South
Wales v Chemler [2007] NSWCA 249; (2007) 5 DDCR 28 at [65]) [54].
2.
In the Notice of Opposition to the appeal against the decision of the Arbitrator, Ms
Ayoub invited Moore ADP to make an assessment of those issues which had not been
determined by the Arbitrator, that is, in relation to the discrimination issue [55]. The
issue of the existence or otherwise of the incidents relating to the discrimination
complaints had been raised by Ms Ayoub for decision by the Arbitrator and, for it to be
resolved, there had to be a finding, a resolution of the conflicting statements of Ms
Ayoub on the one hand, and all the other witnesses on the other [57].
3.
Moore ADP did not use the adverse credit findings she had made on the discrimination
issue either unfairly or at all when she came to consider the issue of reasonableness in
relation to the performance appraisal and retrenchment process [58].
4.
The parties agreed to a review of the decision of the Arbitrator ‘on the papers’. They
were aware that there were disparities between the evidence of the witnesses. It was
readily foreseeable that Moore ADP would seek to resolve those conflicts in the course
of the review. In those circumstances, the request for review "on the papers" must
have involved a conscious waiver of the entitlement to seek an oral hearing before
Moore ADP. Unless Moore ADP adopted an approach which was not reasonably
foreseeable on the material before her, the possibility that there could be a denial of
procedural fairness by adopting the approach proposed by the parties was remote and
did not occur in this case [64].
On the papers
5.
Ms Ayoub argued that it must have become apparent during Moore ADP's
deliberations that the resolution of the dispute required that an opportunity be afforded
to Ms Ayoub to address the discrimination issue matters and, in particular, her credit in
relation to those matters. Reference was made to Hancock v East Coast Timber
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Products Pty Limited [2011] NSWCA 11 (Hancock) per Beazley JA at [96] and Tobias
JA with whom Giles JA agreed at [120] - [122] in support of this submission [66].
6.
Hancock was distinguished on the basis that in Hancock a fundamental and central
issue relating to causation of the plaintiff’s injury arose. The discrimination issue in this
matter was one that Ms Ayoub asked to be addressed (while maintaining that the
appeal could be determined ‘on the papers’) and once it was dismissed, it was an
issue that had no bearing on the reasonableness of the employer’s actions in respect
of the performance appraisal or the redundancy [68].
7.
Ms Ayoub said that the restructure was “bogus” and was just a means to carry out a
predetermined decision to get rid of her. She pointed to three documents in support of
this submission, in particular, a “create retrenchment” quote email request dated
11 September 2007 which she said should have alerted Moore ADP to the fact that
AMP had determined to retrench her as far back as 11 September 2007 [69] – [70].
Although Moore ADP had not specifically mentioned that document, it was open to her
to find that the redundancy and the process surrounding it was genuine, given the
abundance of other documents and statements before her [72] – [73].
AMP’s redundancy policy
8.
It was submitted that Moore ADP overlooked AMP’s own policy document on
retrenchment and re-deployment when she came to the conclusion that the
retrenchment process was reasonable [75].
9.
The absence of notice of retrenchment may, in a particular case, be unreasonable, but
that would not always be the situation. Moore ADP determined that Ms Ayoub's
position was not such that she ought to have been consulted over the issue of staff
reduction. AMP’s decision to inform Ms Ayoub about her retrenchment on 15
November 2007 was not unreasonable. It was the retrenchment itself rather than the
lack of notice of it that was causative of Ms Ayoub’s decompensation. The various
steps taken by AMP to “cushion the impact of the retrenchment” represented a
“reasonable approach” [77].
10.
AMP’s policy requirement to tell an employee about a proposed redundancy as soon
as practicable did not prescribe a precise course of conduct, as the circumstances of a
particular case would dictate what was required [78].
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McCarthy v Patrick Stevedores No 1 Pty Ltd [2011] NSWCA 311
Workers compensation – appeal against decision of Deputy President – limited to decisions
in point of law – whether there was a misapplication of s 40 of the 1987 Act – whether there
was evidence to support the Deputy President’s finding – whether there was a failure to give
adequate reasons – whether there was a denial of procedural fairness in making a
determination on the papers – no error in point of law
Basten JA, Meagher JA and Handley AJA
27 September 2011
Facts:
Mr McCarthy commenced work with the employer in 1982. On 29 August 1998, he fell onto
his buttocks while attempting to sit on a swivel chair. He injured his back, right leg, left leg
and left hip. There was no dispute as to the fact of his injury. In 2002 he claimed weekly
compensation from 14 September to 27 November 1998 and for 9 February 1999. That
claim was settled in November 2002. He later claimed lump sum compensation in respect of
his injury. That claim was settled in March 2005.
In August 2009, Mr McCarthy claimed weekly compensation for partial incapacity for the
period from 1 July 1999 pursuant to s 40 of the 1987 Act. Mr McCarthy claimed that before
the injury he was employed as an allocations officer performing clerical duties and duties
which required walking and stair climbing, and that as a result of the injury he was
downgraded to the position of a receiving and delivery clerk.
The evidence before the Arbitrator included two statements of Mr McCarthy (16 October
2004 and 11 November 2009), medical reports and eight statements made in January or
February 2010 from persons who worked with Mr McCarthy in or about 1998.
The Arbitrator made an award for the respondent as Mr McCarthy had failed to establish the
threshold proof of his pre-injury duties, his duties post injury, and the issues going to proof of
economic loss.
An appeal to a Presidential member was unsuccessful on the issue of a change to his duties
as a result of the effects of his injury (McCarthy v Patrick Stevedores No 1 Pty Ltd [2010]
NSWWCCPD 96).
Held: Appeal dismissed with costs
Meagher JA (Handley AJA agreeing)
Misapplication of s 40 of the 1987 Act
1.
The Deputy President concluded that Mr McCarthy had failed to establish that he had
suffered any economic loss as a result of the injury. The Deputy President relied
principally on Mr McCarthy’s evidence in his 2004 statement, that at the time of his
injury, he carried out the duties of a receiving and delivery clerk and that this did not
change as a result of the injury. Therefore, he was not satisfied that the amount which
Mr McCarthy would probably have been earning, on the assumption that he was an
uninjured worker still engaged in the same employment, would have been other than
what he was able to earn as a receiving and delivery clerk. That finding disclosed no
error. [38]-[40]
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No evidence for finding
2.
This ground was not pressed in the written or oral argument. There was evidence
before the Deputy President to support his finding that before his injury, the appellant’s
duties changed from an allocations officer to a receiving and delivery clerk. That
evidence included Mr McCarthy’s 2004 statement as well as medical evidence which
were inconsistent with the claim that he was unable to work as an allocations officer
because of his injury. [41]
Failure to give adequate reasons
3.
The appellant’s written submissions did not identify any respect in which the Deputy
President’s reasons did not reveal the ground for a crucial finding of fact. The
appellant’s arguments were that the Deputy President’s conclusion was against the
weight of the evidence or did not take sufficient account of other contrary evidence.
Those were arguments that there was an error of fact. The Deputy President identified
the primary ground for his conclusion being a preference for Mr McCarthy’s 2004
statement and the histories in the medical reports, over the evidence of lay witnesses
given 11 years after the event. That was sufficient explanation of the ground for his
crucial finding of fact and did not constitute an error of law. [42]
Dealing with the matter “on the papers”
4.
The appellant submitted there was a denial of procedural fairness in dealing with the
evidence of the lay witnesses. He argued that the inconsistencies should not have
been resolved between those statements and the appellant’s evidence without giving
the appellant the opportunity to address on that question and whether there was any
need for those witnesses to be cross-examined. This submission was rejected on
appeal. [43]
5.
There was conflicting evidence on the factual issue as to the appellant’s position and
duties at the time of his injury. It included Mr McCarthy’s evidence in his 2004 and
2009 statements as well as the lay witness statements and medical evidence. Before
the Arbitrator, the respondent argued that Mr McCarthy’s evidence in his 2004
statement and the medical evidence should be preferred to the recollection of the lay
witnesses 10 years after the event. That submission was made notwithstanding that
none of that evidence had been tested by cross-examination. [45]
6.
Therefore when he lodged his appeal against the Arbitrator’s decision and agreed the
appeal be decided solely on the papers, he was on notice that these inconsistencies
and conflicts in the evidence would need to be addressed and resolved. The appellant
therefore had a reasonable opportunity to address the question of how the Deputy
President should regard the untested evidence of the lay witnesses. [46]
7.
The Deputy President considered whether it was necessary to cross-examine the lay
witnesses. He was satisfied that it was not necessary to test the reliability of their
evidence on the basis it was given 11 years after the event. His proceeding on that
basis did not involve any error in applying s 354 of the 1998 Act, in particular
sub-s 354(6) which enables the exercise of functions without a formal hearing if “the
Commission is satisfied that sufficient information has been supplied to it in connection
with the proceedings”. [47]
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8.
The appellant relied on Hancock v East Coast Timber Products Pty Ltd [2011] NSWCA
11 (Hancock). The circumstances in this case were different from those in Hancock
where there was an issue as to whether the worker’s incapacity was caused by the
work incident. The evidence relied upon by the worker included reports by his treating
orthopaedic surgeon. The President of the Commission in Hancock held that the
worker had failed to discharge the onus of proving that his incapacity resulted from the
work incident. That conclusion was based substantially upon the rejection of evidence
of the orthopaedic surgeon because the facts upon which his opinion was based did
not provide a proper foundation for it (Makita (Australia) Pty Ltd v Sprowles [2001]
NSWCA 305; 52 NSWLR 75). That question had not been raised either before the
Arbitrator or the President. On appeal to the Court of Appeal, it was held that the
appellant worker had been denied procedural fairness (Hancock). [48]
Basten JA
9.
There is no obligation to accord procedural fairness to a witness: nor will a judgment
be set aside on the basis of a failure to take such a step. The impropriety in issue in
Hancock was that of a party in making submissions attacking the integrity of a witness
in circumstances where it had not sought to cross-examine. [8]
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Awick v Formcorp Pty Ltd (No 2) [2011] NSWWCCPD 50
Estoppel; nature of issues in dispute in earlier proceedings between the same parties;
whether issue estoppel arose from earlier determination; whether worker had received a
primary psychological injury or secondary psychological injury; s 65A of the Workers
Compensation Act 1987
Roche DP
8 September 2011
Facts:
The main issue in this appeal was whether an issue estoppel arose from an earlier decision
by an Arbitrator in proceedings between the same parties where, in later proceedings, the
worker sought different relief arising out of the same accident.
Mr Awick worked as a labourer for Formcorp Pty Ltd. On 30 June 2007, he was struck on the
head by falling scaffolding on a building site.
In a decision dated 18 February 2009, Arbitrator Conley found that Mr Awick injured his head
and neck in the incident on 30 June 2007 and accepted that there was “some level of anxiety
and depression as a result of the injury” which contributed to his incapacity. She made an
award in his favour under s 40 of the 1987 Act.
In further proceedings in 2010, Mr Awick was unsuccessful in seeking an increase in his
weekly compensation due to an alleged deterioration in his psychological condition.
On 7 December 2010 he sought lump sum compensation in respect of a primary
psychological injury received in the incident on 30 June 2007. Formcorp disputed this and
argued that Arbitrator Conley’s decision determined that the psychological injury was
secondary to his physical injuries and that that decision created an issue estoppel. Mr Awick
argued that Formcorp was estopped from denying that he had received a primary
psychological injury.
Arbitrator Edwards determined that no issue estoppel arose from Arbitrator Conley’s
decision as she did not determine the issue of whether Mr Awick suffered a primary or
secondary psychological injury. He also determined that Mr Awick suffered a secondary
psychological injury and was not entitled to lump sum compensation for that condition:
s 65A(1) of the 1987 Act.
Mr Awick appealed and argued that Arbitrator Edwards erred in failing to find that Arbitrator
Conley’s decision created an issue estoppel, in accepting the evidence from Drs Roldan,
Champion and Moore whose opinions, had been, by implication, rejected by Arbitrator
Conley.
Held: Arbitrator’s decision confirmed
1.
A primary psychological injury and a physical injury can result from the one incident
(Romanous Constuctions Pty Ltd v Arsenovic [2009] NSWWCCPD 82). The question
was whether Arbitrator Conley made such a finding in the first proceedings to create
an estoppel on that issue in the later proceedings [28].
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2.
It was clear from Arbitrator Conley’s reasons that no question arose in the proceedings
before her as to whether Mr Awick had received a primary or secondary psychological
injury. Therefore, she did not consider that question or make a determination on it [29].
Nor did she say whether the worker’s psychological condition had resulted from the
physical effects of the neck injury or from the traumatic circumstances of the accident
[33].
3.
Arbitrator Conley’s acceptance of the submission that Mr Awick had developed a
psychological condition as a result of the incident did not address the issue which
arose in the proceedings before Arbitrator Edwards, namely, whether, within the terms
of s 65A of the 1987 Act, Mr Awick suffered a primary psychological injury or a
secondary psychological injury [37].
4.
In a statement approved by the High Court in Kuligowski v MetroBus [2004] HCA 34;
220 CLR 363 (at [21]), Lord Guest held in Carl Zeiss Stiftung v Rayner & Keeler Ltd
(No 2) [1967] 1 AC 853 (at 935) that, for an issue estoppel to arise, three conditions
must be satisfied:
“(1) that the same question has been decided; (2) that the judicial decision which
is said to create the estoppel was final; and, (3) that the parties to the judicial
decision or their privies were the same persons as the parties to the proceedings
in which the estoppel is raised or their privies.” [38]
5.
Mr Awick’s argument fell at the first hurdle. Arbitrator Conley did not decide whether
his psychological condition was a primary psychological injury or a secondary
psychological injury. That issue was not pleaded or argued before her.
6.
The argument that Arbitrator Edwards erred in accepting Formcorp’s medical evidence
because it had already been rejected by Arbitrator Conley was dependent on the
acceptance of the estoppel argument [40]. The estoppel argument was rejected.
7.
Arbitrator Conley found that Mr Awick had “some level of anxiety and depression as a
result of the injury” but did not accept that Mr Awick suffered a post-traumatic stress
disorder as a result of the accident. This finding was consistent with the evidence from
Drs Roldan and Champion that Mr Awick did not have post-traumatic stress disorder
and that he embellished his presentation [41].
8.
These doctors were critical of a diagnosis of post-traumatic stress disorder by Mr
Awick’s treating psychologist but Dr Roldan could not entirely discount that Mr Awick
may have had some genuine reactive psychological symptoms [42]. It was open to
Arbitrator Edwards to accept this opinion.
9.
It was open to Arbitrator Edwards to accept Dr Moore’s evidence, which was
consistent with Arbitrator Conley’s decision. Dr Moore diagnosed Mr Awick with a
chronic pain disorder with predominant psychological symptoms related to his chronic
adjustment disorder with predominant depression [44].
10.
The finding that Mr Awick suffered a secondary psychological injury was open to
Arbitrator Edwards and disclosed no error.
11.
The appeal was completely without merit. All claims for permanent impairment in
respect of an injury should be made at the same time: s 263 of the 1998 Act. It was
unacceptable that there were multiple proceedings arising out of the same incident
[49].
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Bricknell v TAC Pacific Pty Ltd [2011] NSWWCCPD 53
Injury; whether the worker was bitten by an insect in the course of employment; application
to rely on fresh evidence or additional evidence on appeal; s 352(6) of the Workplace Injury
Management and Workers Compensation Act 1998; failure to prepare objective chronology
of the principle events
Roche DP
21 September 2011
Facts:
In April 2001, the appellant, Mr Bricknell, experienced weight loss, rashes, myalgia and other
symptoms consistent with renal failure. He was subsequently diagnosed with HenochSchönlein purpura, a form of allergic purpura with erythema. He alleged that his condition
was caused by a spider bite on 9 April 2001 while he was at a work conference in Sydney.
He noticed “big red welt marks around” his right ankle. He showed his ankle to his
supervisor, Mr Keller, who advised him to leave the conference.
Mr Bricknell claimed lump sum compensation in the sum of $28,000 in respect of a 20 per
cent loss of use of each leg at and below the knee under the Table of Maims, plus
compensation for pain and suffering in the sum of $40,000. TAC Pacific disputed liability on
the ground that Mr Bricknell did not receive an injury on 9 April 2001.
The Arbitrator entered an award for TAC Pacific as he found that Mr Bricknell had not
established that he suffered injury by insect bite at work. On appeal, it was submitted that
the Arbitrator erred in making that finding.
Mr Bricknell sought to tender “new evidence” in the form of a statement from Mr Keller which
confirmed that he “noticed red welt marks around the outside of [Mr Bricknell’s] ankle” and
that “he also complained that his ankle was stinging” [40]. He submitted that the evidence
was in contrast to the initial onset of Henoch-Schönlein purpura described by Dr Millar as
presenting in most cases “as red spots spread over various parts of the body in the form of
purpura”. The marks were not “spread over various parts of the body” and the rash did not
appear until 16 days later. It was submitted that Mr Keller’s statement corroborated
evidence of the “stinging” bite and confirmed that an event occurred to trigger the
widespread rash [41(a)-(g)]. Mr Bricknell submitted that there was adequate evidence to
support an inference that he was bitten by an insect at work causing “red welt marks” and
“stinging” on 9 April 2001 and the widespread rash that appeared on 25 April 2001 [43].
Held: Arbitrator’s decision confirmed
1.
The application to rely on “fresh evidence” did not address the terms of s 352(6).
There was no evidence that Mr Keller’s statement could not reasonably have been
obtained before the arbitration [47]. Mr Keller’s evidence did not add anything of
relevance to the evidence that was before the Arbitrator and therefore there was no
injustice in refusing the application to rely on his evidence on appeal [49].
2.
Dr Millar said that whether Mr Bricknell had a bite from an insect or purely the onset of
Henoch-Schönlein purpura was “uncertain and would need someone to have seen the
rash at the time and to have documented it to determine precisely whether he had or
had not a bite from an insect” [51]. Mr Keller’s evidence, even if it was admitted on
appeal, did not provide the kind of “documented” evidence referred to by Dr Millar [53].
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3.
The inference that an insect bit Mr Bricknell on 9 April 2001 and caused his problems
was not the only inference open on the evidence. Mr Bricknell’s submissions ignored
the fact that he gave no evidence of having seen a spider on his leg on 9 April 2001
[55]. The evidence only established that Mr Bricknell showed marks on his ankle to Mr
Keller. A spider bite was not mentioned until 30 June 2001. The Arbitrator was entitled
to consider these matters in declining to draw the inference urged by Mr Bricknell [56].
4.
The following evidence provided by Dr Millar also supported the Arbitrator’s
conclusion:
(a) the renal biopsy in May 2001 showed significant changes in the renal tubules
and Dr Millar said that it was “certainly present for some time prior to this
incident in 2001, so that if he had an insect bite, it did not cause his renal
problem” [57], and
(b) the description of the purpura when Mr Bricknell was in hospital “very strongly
suggested the whole problem is one of Henoch-Schönlein purpura rather than
an insect bite, which has precipitated his problem” [58].
5.
The Arbitrator’s conclusion was open to him and disclosed no error.
13
Nguyen v WorkCover Authority of New South Wales [2011] NSWWCCPD 55
Employment; identity of worker’s employer; whether employed by an individual or a
partnership; whether a partnership existed; credit findings; application of principles in Fox v
Percy [2003] HCA 22; 214 CLR 118
Roche DP
29 September 2011
Facts:
The issue in this case was who employed the worker. The worker said he was employed by
Bong Nguyen (who was uninsured), and claimed compensation from the Nominal Insurer for
an injury that occurred on 20 February 2008 when he fell through an open skylight at
premises at Cabramatta while he was assisting two men (Bong Kim Nguyen and Hoan Lam
Ton) to replace an air-conditioning unit. The Nominal Insurer accepted the claim and paid
compensation.
A s 145 notice was issued by WorkCover against Mr Nguyen seeking to recover the
compensation paid by the Nominal Insurer to or on behalf of the worker. Mr Nguyen filed an
application seeking a determination under s 145(3) as to his liability in respect of the
payments made.
Mr Nguyen is an electrician. He alleged that Mr Ton employed the worker and himself or, in
the alternative, a partnership made up of Mr Nguyen and Mr Ton employed the worker. Mr
Ton denied employing either the worker or Mr Nguyen.
The Senior Arbitrator concluded that Mr Nguyen employed the worker and that there was no
partnership or joint venture between Mr Nguyen and Mr Ton. As a result, Mr Nguyen was
liable to reimburse the Nominal Insurer for the compensation paid.
On appeal, Mr Nguyen submitted that the Senior Arbitrator erred in:
(a)
(b)
(c)
(d)
(e)
finding that Mr Nguyen and Mr Ton were not in partnership;
failing to properly assess the employment indicia;
his assessment of the worker’s credit;
determining that Mr Ton did not pay the worker, and
ruling that Mr Nguyen could not amend the application to claim indemnity from
Mr Ton for one-half of any liability Mr Nguyen had under the s 145 notice.
Held: Arbitrator’s decision confirmed
Partnership issue
1.
The Full Federal Court held in Amadio Pty Ltd v Henderson (1998) 81 FCR 149 at 179
that “existence of a partnership is determined by reference to the true contract and
intention of the parties as appearing from all the facts and circumstances relevant to
the relationship of the parties” [38].
2.
For a partnership to exist: a business must be carried on; it must be carried on by
persons in common, and it must be conducted with a view to profit (AM Marketing Pty
Ltd v Howard Media Pty Ltd [2010] NSWSC 803) [39].
14
3.
Mr Ton carried on a refrigeration and air-conditioning business and agreed with the
occupier of the Cabramatta premises that he would replace the air-conditioning unit at
those premises. Mr Nguyen played no part in the making of that contract [41].
4.
Mr Ton and Mr Nguyen conducted quite separate businesses and there was no
evidence to indicate that Mr Ton regarded Mr Nguyen as his partner. He regarded him
as a sub-contractor who provided his skills in exchange for a share of the profits [43].
5.
There was no evidence of any mutuality of rights and obligations: Lang v James
Morrison & Co Ltd [1911] HCA 49; 13 CLR 1 at 11 [44].
6.
Even if there was an agreement to share profits, that did not establish the existence of
a partnership and did not come from any decision to go into business together. It was
agreed machinery for arriving at a sum of money (Haggitt v Watson [1927] NZLR 209
at 230) [49].
7.
There was no agreement to share losses, no evidence of sharing accounts, joint
financial statements, common tax file number, common business activity statements,
business plans or any other of the indicia of a partnership [50].
8.
The Senior Arbitrator did not err in finding that a partnership did not exist.
Employment indicia
9.
The issue of who employed the worker was approached by the Senior Arbitrator by a
careful analysis of the evidence and application of the accepted legal authorities (in
particular, Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16) to the facts
[56] and [66].
10.
For a contract of employment to exist, there must be an intention by the parties to
enter into legal relations. Whether a contract has been formed is judged objectively,
not by reference to the parties’ subjective beliefs (Lindeboom v Goodwin (2000) 21
NSWCCR 297) [61].
11.
The submission that the Senior Arbitrator failed to have regard to the fact that the
project was an air-conditioning installation project, organised by Mr Ton, and not an
electrical project, was rejected. That did not mean that the organiser of the project was
the employer [66].
12.
The submissions that the Senior Arbitrator failed to give sufficient weight to the fact
that Mr Ton was the “driving force, organiser and major profiteer from the project” and
failed to have regard to the size and weight of the air-conditioning unit were rejected as
they were not decisive or relevant factors in determining who employed the worker.
13.
The evidence firmly established that Mr Nguyen employed the worker.
The worker’s credit and whether Mr Ton paid the worker
14.
The Senior Arbitrator correctly observed that, as the worker’s compensation claim had
already been paid, he had no motivation to be untruthful in his answers on crossexamination and his evidence was found to be more acceptable than Mr Nguyen’s and
Mr Ton’s evidence [72], [75] and [82].
15.
The worker’s evidence supported the conclusion that Mr Nguyen had employed the
worker.
15
16.
After a detailed analysis of the evidence and the numerous inconsistencies in Mr
Nguyen’s evidence [91]-[98], the Senior Arbitrator rejected Mr Nguyen’s credit
concluding that Mr Nguyen was “prepared to say whatever was required, to distance
himself from the proposition there was a contract of service between him and the
worker”.
17.
Having regard to this damning criticism, it was open to the Senior Arbitrator to prefer
the worker’s evidence [99]. It also followed from this finding, the worker’s evidence that
Mr Nguyen paid him $100 and Mr Ton’s denial of reimbursement of $50 to Mr Nguyen,
that it was open to the Senior Arbitrator to find that Mr Ton did not pay the worker
[106].
18.
It could not be shown that the Senior Arbitrator “failed to use or has palpably misused
his advantage”, or acted on evidence which was “inconsistent with facts
incontrovertibly established” or “glaringly improbable” (Devries v Australian National
Railways Commission [1993] HCA 78; 177 CLR 472 at 479, 480–481; Fox v Percy
[2003] HCA 22; 214 CLR 118 at [25]–[27]) [100].
Amendment
19.
The Senior Arbitrator appropriately refused Mr Nguyen’s application to amend to claim
an indemnity from Mr Ton for half of any liability he had to WorkCover under the s 145
notice.
20.
The Commission’s jurisdiction, like that of the Compensation Court before it, is to hear
and determine all matters arising under the 1998 Act and the 1987 Act (s 105 of the
1998 Act) [111].
21.
The Commission is a statutory body that derives its powers from the 1987 Act and the
1998 Act, the Rules and Regulations validly made under those Acts. It does not have
any inherent jurisdiction (Raniere Nominees Pty Ltd t/as Horizon Motor Lodge v Daley
[2006] NSWCA 235; 67 NSWLR 417) [114].
22.
Even if the partnership argument had succeeded, the Commission did not have
jurisdiction to determine the rights and liabilities of the alleged partners. The Senior
Arbitrator was right to refuse the application to amend [115].
16
North Coast Area Health Service v Felstead [2011] NSWWCCPD 51
Personal injury under s 10 of the Workers Compensation Act 1987; disease injury; personal
injury; journey incident; failure to give adequate reasons
Roche DP
13 September 2011
Facts:
Mr Felstead commenced work with the North Coast Area Health Service in 1998. He
worked as a truck driver/kitchen hand; generally three days per week driving, and one day
per week as a kitchen hand, later changed to two days per week driving, and two days per
week as a kitchen hand.
On 19 August 2008 Mr Felstead, whilst riding his motorcycle on his journey home from work,
collided with a motor vehicle (“2008 injury”). Police were not called to the incident, and Mr
Felstead rode home. He attended Lismore Base Hospital where he was treated at the
emergency department for an abrasion to the back of his lower left leg and tenderness in his
left calf muscle. Mr Felstead was issued with a WorkCover, and following treatment he was
discharged. Mr Felstead had four days off from work and then returned to his pre-injury
duties.
Mr Felstead had several pre-existing medical conditions at the time of the injury. He
suffered from left leg sciatica following a hay cart accident in 1984. He conceded that he
had a longstanding back condition which he had managed for 11.5 years. He also sustained
a left knee injury in November 2006 (“2006 injury”) whilst at work. Liability had been
admitted for the 2006 injury; he had undergone surgery, and had recovered, though he
states that he continued to feel a dull pain in his left knee. It was Mr Felstead’s submission
that he had been able to manage the pain to his knee and back until his accident on 19
August 2008, following which he required medical advice and treatment.
Between 22 August 2008 and 21 August 2009 Mr Felstead had several medical attendances
where he complained of having difficulty standing for long periods of time, sciatica, lower
back pain, and pain to left knee interfering with weight bearing and walking. It was noted on
several of the medical certificates that the lower back pain was exacerbated by Mr
Felstead’s obesity and his standing for long periods at work (as required by his position as a
kitchen hand). During this period (on 24 February 2009) he also sustained a further injury
when his right foot was squashed between two pallets (“2009 injury”). The 2009 injury
resulted in Mr Felstead relying extensively on his left leg to compensate the injury to his right
foot which aggravated his left knee injury. Mr Felstead last worked for the North Coast Area
Health service on 21 August 2009.
On 2 October 2009 Mr Felstead made a WorkCover application in respect of the 2008 injury.
Between 27 August 2009 and 18 June 2010 Mr Felstead undertook further medical
examinations in respect of his lower back pain and left knee complaints. Several conditions
were identified such as left leg sciatica, degenerative changes to the lumbar spine, and
osteoarthritis in his left knee. Medical opinion was diverse in respect of the causes of these
conditions. Some medical reports noted that the “left knee was completely normal” [58], and
that any knee or back complaints were “related to his obesity” [59]. Other medical reports
17
linked some of the current medical complaints in part to the 2006 injury, and/or 2008 injury.
On 11 February 2011 Mr Felstead’s general practitioner, Dr O’Brien, reported that she
believed Mr Felstead’s 2008 injury was a “contributing factor to [his] current inability to work”,
though she did not detail what injuries had been sustained.
The Arbitrator determined that Mr Felstead’s back complaints were not related to the 2008
injury, however he was satisfied his left leg (including his left knee) complaints were. The
Arbitrator made an award in favour of the worker in respect of the left leg injury.
North Coast Area Health Service appealed this finding on the grounds that the Arbitrator
erred in:
(a) finding that the reference to “personal injury” in s 10 of the 1987 Act has the same
meaning as the definition of “injury” in s 4 of that Act (personal injury);
(b) applying the incorrect test in ascertaining whether the worker had received a
personal injury to his left knee (personal injury);
(c) failing to give proper reasons as to whether the worker injured his left knee in the
motor vehicle accident on 19 August 2008 (left knee injury);
(d) finding that the worker suffered a personal injury to the left knee in the motor
vehicle accident on 19 August 2008 (left knee injury), and
(e) relying on the report of Dr Campbell as supporting the proposition that any
incapacity from mid-2009 was related to any personal injury to the left knee
received in the August 2008 incident (incapacity).
Held: The Arbitrator’s decision was revoked and an award granted to the respondent
employer.
Personal injury under s 10 and s 4 of the 1987 Act
1.
Section 10(1) of the 1987 Act states:
“A personal injury received by a worker on any journey to which this section applies
is, for the purposes of this Act, an injury arising out of or in the course of employment,
and compensation is payable accordingly.”
2.
Section 4 of the 1987 Act defines an injury as:
“injury:
(a)
means personal injury arising out of or in the course of employment,
(b)
includes:
(c)
(i)
a disease which is contracted by a worker in the course of employment and
to which the employment was a contributing factor, and
(ii)
the aggravation, acceleration, exacerbation or deterioration of any disease,
where the employment was a contributing factor to the aggravation,
acceleration, exacerbation or deterioration, and
does not include (except in the case of a worker employed in or about a mine) a
dust disease, as defined by the Workers’ Compensation (Dust Diseases) Act
18
1942, or the aggravation, acceleration, exacerbation or deterioration of a dust
disease, as so defined.”
3.
In order to succeed with a claim under s 10 “a worker must have received a personal
injury, that is, a sudden identifiable pathological change brought about by an internal or
external event. That such a change also causes, or can be characterised as, an
aggravation of a disease will not prevent it being a personal injury.” (Yum Restaurants
Australia Pty Ltd t/as Pizza Hut Restaurants v Watters [2010] NSWWCCPD 31
(Watters) at [66]).
4.
In determining that the worker did sustain an injury, the Arbitrator noted [at [71] of his
reasons] that the “two relevant clauses between s 4 and s 10” are “circular and an
injury includes a personal injury, and a personal injury includes an injury”. The
Arbitrator went on to say “if one is injured on a journey claim, one is injured simpliciter,
that is some damage to the body thus it also covers the second limb of sub-paragraph
(b) of s 4”. Without defining an “injury simpliciter”, that statement was unhelpful. The
question was whether the worker received a “personal injury: on a journey to which s
10 applied.
5.
Section 4(b) of the 1987 Act is a reference to a disease injury. It was noted in Watters
(at [76]) that:
“[t]o establish a disease injury it is necessary that the disease be contracted in
the course of the employment and to which the employment was a contributing
factor (s 4(b)(i)), or, in the case of an aggravation injury, that the employment
was a contributing factor to the aggravation (s 4(b)(ii)). While on a journey, a
worker will not normally be in the course of his or her employment and
employment will not be a contributing factor to a disease injury. Therefore, to
succeed, Ms Watters has to establish that she received a personal injury, that is,
a sudden identifiable pathological change.”
6.
A worker cannot receive a disease injury (either under s 4(b)(i) or under s 4(b)(ii))
while on a s 10 journey because, in the overwhelming majority of cases, the worker
will not be in the course of his or her employment while on such a journey and, in
those circumstances, employment cannot be a contributing factor to the contraction of
a disease (s 4(b)(i)), or the aggravation of the disease (s 4(b)(ii)) (O’Neill v Lumbey
(1987) 11 NSWLR 640. [76]
7.
However, a “personal injury” received on a s 10 journey which also aggravates or
exacerbates a pre-existing disease is nonetheless a personal injury Zickar v MGH
Plastic Industries Pty Ltd [1996] HCA 31; 187 CLR 310 (Zickar). [77]
8.
A “personal injury” and a “sudden identifiable pathological change” (Zickar; Kennedy
Cleaning Services Pty Ltd v Petkoska [2000] HCA 45; 200 CLR 286 (Petkoska)) test
suggests no more than that, to qualify as a personal injury, there must be some
sudden and ascertainable or dramatic physiological change or disturbance of the
normal physiological state. Such a change or disturbance may be as simple as a
bruise or a soft tissue strain. If the personal injury also aggravates a pre-existing
disease, that does not mean it is no longer a personal injury [81].
9.
The reference in Petkoska to a “sudden or identifiable” change does not create a
disjunctive test, as had been submitted by the worker’s counsel. If an event occurs,
such as the rupture of an artery, that will normally qualify as a personal injury even
though it is the end result of a disease process. However, if the pathological change is
19
not identifiable or ascertainable, it will obviously be difficult, if not impossible, to
establish that the worker has received a personal injury. The reference to
identifiable/ascertainable is merely a legal frame of reference to give contextual
meaning and sense to “personal injury” [82].
Failure to give reasons
10.
Mr Felstead alleged that he injured his back and his left knee in the August 2008
accident. The Arbitrator determined that Mr Felstead had not injured his lower back in
the accident on 19 August 2008, and this determination was not challenged on appeal.
The Arbitrator did find however, that Mr Felstead had injured his left knee on 19
August 2008.
11.
In coming to this conclusion the Arbitrator relied primarily on the evidence of Mr
Felstead and Dr Adams’ report prepared on 19 August 2008, wherein both describe
that Mr Felstead presented to the hospital with left knee pain. However, upon medical
examination, Dr Adams found that Mr Felstead suffered an abrasion to the skin of the
posterior lower leg, bony tenderness to the mid tibia, and swelling and tenderness to
the left calf. There was no mention of an injury sustained to Mr Felstead’s left knee in
Dr Adams’ report.
12.
It was argued by North Coast Area Health Service that the Arbitrator had failed to give
proper reasons as to whether Mr Felstead injured his knee on 19 August 2008. In
order to succeed on this point, North Coast Area Health Service had to demonstrate
not only that the reasons are inadequate, but that their inadequacy discloses that the
Arbitrator has failed to exercise his statutory duty to fairly and lawfully determine the
application (YG & GG v Minister for Community Services [2002] NSWCA 247;
Absolon; ADCO Constructions Pty Ltd v Ferguson [2003] NSWWCCPD 21). [93]
13.
In determining whether the Arbitrator’s reasons were inadequate, it was noted as per
Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 (Soulemezis) at 280
that:
“If an obligation to give reasons for a decision exists its discharge does not
require lengthy or elaborate reasons: Ex parte Powter; Re Powter (1945) 46 SR
(NSW) 1 at 5: 63 WN 34 at 36. But it is necessary that the essential ground or
grounds upon which the decision rests should be articulated. In many cases the
reasons for preferring one conclusion to another also need to be given.”
14.
Roche DP determined that the reasons provided by the Arbitrator as to whether the
worker had suffered a personal injury were inadequate. Whilst it was acknowledged
that the Arbitrator had referred to the evidence and the submissions in detail, he had
merely concluded that he was satisfied that the worker had injured his leg and knee,
rather than providing his reasoning supporting this conclusion. [99]
Left knee injury
15.
An analysis of the various contemporaneous medical reports and examinations
showed a focus on an examination of the lower left leg and not Mr Felstead’s knee.
The first record of Mr Felstead complaining about left knee symptoms after the bike
accident was in Dr O’Brien’s notes dated 25 March 2009 (seven months after the
accident). However, those complaints were linked to the 2006 injury [106].
20
16.
Whilst the sudden identifiable pathological change does not need to be significant in
order to satisfy the definition of a personal injury, the mere fact that an accident has
occurred does not mean that a personal injury has also been sustained [120]. In this
instance, the medical evidence supported the fact that Mr Felstead did receive an
injury to his left calf and lower left leg, but not to the left knee for which Mr Felstead
had claimed workers compensation.
17.
On the weight of this evidence and subsequent medical reports, the Arbitrators finding
that Mr Felstead had injured his knee on 19 August 2008 was unsupportable.
Incapacity
18.
In order to recover compensation for an injury, it must be established that the
incapacity has resulted from the alleged injury. In a claim for weekly compensation,
compensation is not payable for the injury but for the loss of power to earn caused by
the injury, that is, for the economic incapacity for work that results from the injury
(Williams v Metropolitan Coal Co Ltd [1948] HCA 8; 76 CLR 431 per Starke J at 444;
Ward v Corrimal-Balgownie Collieries Ltd [1938] HCA 70; 61 CLR 120 at 129). [84]
19.
As Mr Felstead failed to establish that he injured his knee in the bike accident, it was
not possible to support a finding of incapacity arising from an injury to the knee. In the
alternative, if an injury to the knee was sustained, Mr Felstead had not established that
the effect of the injury was continuing or that his incapacity had resulted from that
injury [128].
21
Jetstar Airways Pty Ltd v Canterbury [2011] NSWWCCPD 54
Psychological injury; whole or predominant cause of injury; reasonable action taken with
respect to discipline; s 11A of the 1987 Act
Keating P
22 September 2011
Facts:
Mr Chad Canterbury was employed as a flight attendant by Jetstar. On 4 December 2009,
he and a work colleague were “deadheading” on Jetstar flight JQ521 between Sydney and
Melbourne. He was not assigned operational duties on flight JQ521.
During the course of the flight they were offered refreshments. Mr Canterbury consumed
alcohol and confectionary. He gave his credit card to one of the flight crew to pay for the
refreshments however the card was not debited and no receipt for the transaction was
obtained.
On 23 December 2009 Jetstar informed Mr Canterbury he would be investigated for alleged
breaches of company policy for consuming alcohol whilst in uniform and on duty, and for the
non-payment of the goods.
Following an investigation the alleged breaches were sustained and a formal warning was
issued.
It was common ground that Mr Canterbury suffered a psychological injury.
On 8 December 2010, Mr Canterbury lodged an Application in the Commission claiming he
sustained psychological injuries. The claim initially relied on the cause of injury being the
effects of both the disciplinary action and bullying by his manager. He later withdrew the
bullying accusation.
On 4 May 2011, the Arbitrator found in favour of Mr Canterbury. He found that Jetstar’s
s 11A defence failed as it had not proved that the disciplinary action was the whole or
predominant cause of Mr Canterbury’s injury. He also determined that Jetstar’s actions with
respect to discipline were not reasonable.
Held: Arbitrator’s determination confirmed
Whole or predominant cause of injury
1.
The onus of proof of establishing any of the matters under s 11A of the 1987 Act falls
on the employer (Department of Education and Training v Sinclair [2005] NSWCA 465;
4 DDCR 206; Pirie v Franklins Ltd [2001] NSWCC 167; 22 NSWCCR 346). [116]
2.
Mr Canterbury did not concede that his injury was wholly or predominantly due to the
actions of the employer with respect to discipline. He merely withdrew the allegation
that his psychological injury was caused by allegations of bullying and harassment by
his manager. That concession did not relieve Jetstar of the requirement to prove the
elements of its s 11A defence that the disciplinary action was the whole or
predominant cause of Mr Canterbury’s injury and that its actions were reasonable.
[117]
22
3.
The Arbitrator’s finding was based on Jetstar’s own evidence in Ms Elphinstone’s
report, a psychologist/investigator, that there were several causes of Mr Canterbury’s
condition and that at least one of which involved a management issue relating to
irregularities in the worker’s sick leave and not the disciplinary action. The Arbitrator’s
conclusion that the employer failed to prove that the worker’s injury was wholly or
predominantly due to disciplinary action disclosed no error. [125]
4.
Whilst there was a temporal connection between the completion of the disciplinary
process and Mr Canterbury going off work, the temporal connection did not, of itself,
demonstrate that the worker’s psychological injury was wholly or predominantly due to
the effects of the disciplinary action. [127]
Were the actions of the employer reasonable?
5.
Whether an employer’s action was “reasonable” within the meaning of s 11A(1) is an
objective test which required an objective assessment of the reasonableness of the
action of the employer. If the Commission takes the view that the action taken by the
employer is not reasonable in all the circumstances, the employer cannot rely on s 11A
merely because it held a genuine belief, based on reasonable grounds, that the action
was reasonable (Jeffery v Lintipal Pty Ltd [2008] NSWCA 138 at [50]). [146]
6.
Jetstar’s finding that, contrary to policy, the worker was in uniform at the time of the
consumption of alcohol was confirmed on appeal to be unreasonable. The finding was
against the evidence and the weight of the evidence. Jetstar failed in the course of its
investigation to obtain evidence from witnesses who were in a position to give
evidence on that issue. [151]
7.
Jetstar’s policies and procedures with respect to consumption of alcohol in-flight whilst
deadheading were confusing and contradictory. Operating Manual OM 12 permits the
consumption of alcohol while on duty, provided the worker is not in uniform. [152]
8.
The President rejected Jetstar’s submission that the onus was on the worker to clarify
at the time of training any ambiguity regarding any instructions on consuming alcohol
during staff travel. The obligation was on Jetstar to communicate its policies and
procedures in clear and unambiguous terms. Placing the onus on the worker to clarify
its contradictory and confusing policies was an unreasonable response. [153]
9.
Jetstar’s submission that the worker was on duty was rejected. Jetstar provided no
evidence as to what constituted duty travel and the context in which it appeared led to
an inference that whilst deadheading, staff were on duty travel and not duty in the
conventional sense. The finding was upheld on appeal. [155]
10.
The Arbitrator held that Jetstar’s finding in relation to non-payment was unreasonable.
Jetstar’s finding was against the evidence and weight of the evidence. Several
witnesses observed Mr Canterbury hand over his credit card to a member of the flight
crew. [156]
11.
The Arbitrator’s finding that the employer’s actions with respect to discipline were
unreasonable, disclosed no error and was upheld on appeal.
23
East Coast Timber Products Pty Ltd v Hancock (No2) [2011] NSWWCCPD 48
Arbitrator erred in failing to give adequate reasons for his decision; determined on remitter
from the Court of Appeal
NB: This case concerned a review under s 352 before the amendments which took effect on
1 February 2011.
Roche DP
1 September 2011
Facts:
Mr Hancock was employed as a labourer stacking and sorting timber. He claimed that on
31 October 2005 he fell at work and injured his right knee. He sought medical treatment
several days after the fall and did not submit a claim for workers compensation. He alleged
that as a consequence of that injury his knee remained troublesome, but he was able to
keep working. However, by 2007 he required medical intervention and he ultimately
submitted to surgery in June 2008. He has not worked since 25 March 2008. His
employment was terminated on 16 October 2008.
East Coast disputed that Mr Hancock injured his knee at work on 31 October 2005 and, in
the alternative, argued that, if he did injure his knee on that day, he recovered from the
effects of that injury and any incapacity had resulted from several later non-work related
incidents.
Case History:
At first instance Mr Hancock was successful and was awarded weekly compensation and
benefits for total incapacity.
The matter was appealed challenging the Arbitrators finding of injury and incapacity.
President Keating found that the Arbitrator had correctly found that Mr Hancock had fallen
and injured his knee on 31 October 2005, but that Mr Hancock had failed to discharge the
onus of proving his incapacity commencing on 26 March 2008 was a result of the injury
sustained on 31 October 2005. In making this determination, President Keating applied
Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705 (‘Makita’) per
Heydon JA at [85]. The Arbitrator’s decision was revoked and an award entered for East
Coast (see East Coast Timber Products Pty Ltd v Hancock [2009] NSWWCCPD 123).
The decision of President Keating was then appealed to the Court of Appeal. There were
three main issues on appeal. Firstly that President Keating had erred in his application of
the Makita principle. Secondly, that he had failed to draw a Jones v Dunkel (Jones v Dunkel
[1959] HCA 8; (1959) 101 CLR 298; [1959] ALR 367) inference in favour of Mr Hancock in
respect of East Coast’s failure to supply its own medico-legal experts’ report. Thirdly, that
the President had misdirected himself on the issue of causation. The Court of Appeal found
that the President had erred in his application of the Makita principle, and therefore did not
consider the further issues raised. The Appeal was allowed and remitted to the Commission
for redetermination (Hancock v East Coast Timber Products Pty Ltd [2011] NSWCA 11).
The matter was remitted to Deputy President Roche who considered the Arbitrator’s failure
to provide adequate reasons.
24
Held: The Deputy President confirmed the Arbitrator’s finding that Mr Hancock had
injured his knee on 31 October 2005, but because of a lack of reasons, revoked the
finding on causation.
Consequences of a failure to provide adequate reasons
1.
The failure to provide adequate reasons constitutes an error of law and may be a
ground to set aside an Arbitrator’s decision [53]. In order to have the decision set aside
two elements must be satisfied. Firstly, it must be demonstrated that the reasons were
inadequate, and secondly, that the inadequacy shows that the Arbitrator failed to
exercise his or her duty to fairly and lawfully determine the application (YG & GG v
Minister for Community Services [2002] NSWCA 247; Absolon; ADCO Constructions
Pty Ltd v Ferguson [2003] NSWWCCPD 21) [55].
2.
In determining whether reasons are inadequate, the questioner should bear in mind
that the standard by which adequacy of reasons must be determined is relative to the
nature of the decision itself and the decision-maker (Mayne Health Group t/as Nepean
Private Hospital v Sandford [2002] NSWWCCPD 6) [56], and that it is not necessary
for an Arbitrator to refer to every piece of evidence (Yates Property Corporation Pty Ltd
(in liq) v Darling Harbour Authority (1991) 24 NSWLR 156; Ainger v Coffs Harbour City
Council [2005] NSWCA 424) [56].
3.
However, “it is necessary that the essential ground or grounds upon which the decision
rests should be articulated. In many cases the reasons for preferring one conclusion to
another also need to be given.” (Ex parte Powter; Re Powter (1945) 46 SR (NSW) 1 at
5: 63 WN 34 at 36). [57]
Adequacy of Arbitrator’s reasons re: causal event
4.
East Coast submitted at the arbitration that Mr Hancock’s failure to contemporaneously
report his fall on 31 October 2005, despite his knowledge that he had to do so in order
to receive workers compensation, suggested that the event was “trivial in nature” [61].
5.
On the injury issue, the Arbitrator:
a)
set out Mr Hancock’s evidence;
b)
referred to corroborative evidence from Mr Hancock’s mother;
c)
noted the lack of a formal report of injury, but added that a co-worker confirmed
that Mr Hancock had mentioned to him that he’d slipped on some timber at work,
and
d)
noted the GP’s records that Mr Hancock had a clearance to return to work
“following right knee injury at work”.
6.
East Coast argued on appeal that the Arbitrator’s reasons failed to consider the
inconsistent dates in Mr Hancock’s statements [66].
7.
This argument was rejected. The starting point in any analysis of whether an Arbitrator
has failed to give adequate reasons is to look at the issues in dispute and the
submissions made by the parties at the arbitration. If a matter was not argued in the
first instance, it is not open to complain on appeal that the Arbitrator failed in his or her
25
duty to give reasons dealing with that matter (Brambles Industries Ltd v Bell [2010]
NSWCA 162; 8 DDCR 111) [59].
8.
Given the submissions at the arbitration, namely, that whatever happened on 31
October 2005 was “trivial”, the Arbitrator’s reasons adequately dealt with the issue of
injury [66].
Adequacy of Arbitrator’s reasons re: causation
9.
East Coast, following its submission that the fall on 31 October 2005 was unlikely to be
the causal event, then detailed several subsequent incidents which, it argued, either
singularly or jointly may have caused Mr Hancock’s current incapacity.
10.
East Coast clearly raised the causation issue and this required the Arbitrator to deal
with that issue and give reasons why he felt that Mr Hancock’s condition in 2008 had
resulted from the 2005 injury.
11.
The Arbitrator had to explain that the pathology diagnosed by Dr Summersell in 2008
had resulted from the 2005 injury [68]. On this critical issue, the Arbitrator did not
explain why he preferred Mr Hancock’s evidence to the evidence of several lay
witnesses.
12.
He merely said that he accepted Mr Hancock’s evidence and that he was persuaded
by the medical evidence. That statement did not explain his reasoning process and
did not adequately deal with the contentious issue of causation, which depended
heavily on the reliability of Mr Hancock’s evidence of having had continuous and
increasing symptoms since the October 2005 fall. Where “nothing exists but an
assertion of satisfaction on undifferentiated evidence the judicial obligation [to give
reasons] has not been discharged” Soulemezis v Dudley (Holdings) Pty Ltd (1987)
NSWLR 247 [69].
Was the Arbitrator’s decision correct?
13.
It was then considered on the basis that the Arbitrator had failed to provide adequate
reasons whether the Arbitrator’s decision was incorrect.
14.
Mr Hancock argued that “before ‘disrupting’ the arbitral decision, the Presidential
member must be satisfied that the original decision is wrong” (State Transit Authority
of New South Wales v Chemler [2007] NSWCA 249; 5 DDCR 286 (Chemler)). It was
not sufficient that the Presidential member would reach a different conclusion or would
take an alternative view of the facts, if the original decision were reasonably open to
the Arbitrator” [18].
15.
This argument succeeded. However, in the absence of sufficient reasons provided by
the Arbitrator, and in light of the evidentiary gaps referred to by the Court of Appeal it
was not possible to determine whether the Arbitrator’s finding on causation was correct
[74].
16.
The finding that Mr Hancock injured his knee on 31 October 2005 was confirmed, but
the nature and extent of that injury, and the consequences following from it, were
remitted for re-determination by a different arbitrator [75].
26
Koutsioukis and Koutsioukis t/as Taste of Europe Bakery v Bouza [2011] NSWWCCPD
52
Costs where appellants filed Election to Discontinue Proceedings; s 341 Workplace Injury
Management and Workers Compensation Act 1998
Roche DP
14 September 2011
Facts:
On 13 December 2006, Arbitrator Simpson found that Mr Bouza, the worker, had suffered a
personal injury to his right shoulder on or about 4 June 2001 and another personal injury to
the same shoulder on 27 July 2001. She also found that the left shoulder condition was of
gradual onset due to Mr Bouza’s work, but rendered symptomatic because of his right
shoulder symptoms. He had also suffered an injury to his back as a result of the heavy
nature of his work. Mr Bouza’s incapacity was found to have resulted from the second
shoulder injury on 27 July 2001.
The appellants were uninsured in respect of the period prior to 19 July 2001 and were
insured by Employers Mutual after that date. Therefore, Employers Mutual was liable for
weekly compensation and the appellants were liable for part of the lump sum compensation.
Employers Mutual appealed the Arbitrator’s decision. Moore ADP confirmed the decision
and remitted the matter for referral to an AMS. Employers Mutual then appealed the AMS’s
assessment to an Appeal Panel. In the absence of the appellants, it was agreed at the post
Appeal Panel teleconference on 25 September 2008 that Mr Bouza’s lump sum
compensation claim would be paid by Employers Mutual as to $35,000 and by the appellants
as to $26,800.
WorkCover paid the compensation and costs awarded against the appellants. By service of
several notices on the appellants (the last notice was served on or about 17 November
2009), WorkCover sought reimbursement from the appellants under ss 145 and 145A of the
1987 Act. Under s 145(3), the appellants had 28 days from service of the notice to apply to
the Commission for a determination of their liability. They did not do this. On 17 August 2010
they unsuccessfully applied to have the Arbitrator reconsider her determination of 13
December 2006.
The appellants then sought leave to challenge the Arbitrator’s determinations of 13
December 2006, 30 September 2008 and 15 May 2009 in an appeal filed on 30 August
2010. The appeal was filed over one year outside the 28 day time limit in s 352(4) of the
1998 Act.
There were a series of teleconferences held to address the deficiencies in the appellants’s
submissions and directions issued to allow for the appeal to be amended and further
submissions to be filed and served. The appellants did not comply with any of those
directions and ultimately filed an Election to Discontinue Proceedings the day before the
matter was listed for hearing.
Employers Mutual, in the interests of the third respondents, did not consent to the
discontinuance and sought costs in accordance with Pt 15 r 15.7(4) of the 2010 Rules, which
are identical to the 2011 Rules.
27
Held: Appellants to pay costs of the third respondents’s insurer
1.
The discontinuance of the appeal did not prevent the making of a costs order. The
Commission’s Rules expressly contemplate an application for costs in such a situation
(Pt 15 r 15.7(4) of the Rules) and are consistent with the practice in the former
Compensation Court (see Davis v State Rail Authority (NSW) (2001) 21 NSWCCR
322) [23].
2.
The common law presumption is that costs follow the event. A successful party to
proceedings has a “reasonable expectation” of being awarded costs against the
unsuccessful party to the proceedings (Oshlack v Richmond River Council [1998] HCA
11; 193 CLR 72 at [134]). A court has a discretion to depart from this presumption, if it
is exercised judicially (Donald Campbell & Co Ltd v Pollak [1927] AC 732), and
“according to rules of reason and justice” (Williams v Lever [1974] 2 NSWLR 91 at 95)
[27].
3.
Generally, it is misconduct on the part of the successful party that is the basis on which
the discretion is exercised to displace the presumption (Anglo-Cyprian Trade Agencies
v Paphos Wine Industries Ltd [1951] 1 All ER 873 at 874; Ritter v Godfrey [1920] 2 KB
47; Trade Practices Commission v Nicholas Enterprises Pty Ltd (1979) 28 ALR 201)
[28]. The appellants’s submission that Employers Mutual engaged in conduct that
would disentitle it to a costs order was rejected. Employers Mutual did not have a duty
to the appellants in respect of the uninsured period. The fact that the appellants had
not been notified of the hearing before the Arbitrator was not determinative of the costs
question [29].
4.
Section 341 gives the Commission a broad discretion to determine questions relating
to costs [34]. Section 341(4) expressly alters the common law presumption that costs
follow the event, as it prevents the Commission from making an order for costs against
an unsuccessful claimant unless the claim was frivolous or vexatious, fraudulent or
made without proper justification. Insurers and employers do not have the protection of
s 341(4), as they are not persons entitled to make a claim for compensation or work
injury damages [35].
5.
Section 341 must be read with s 337 of the 1998 Act [36]. Part 17 of the 2010
Regulation regulates costs in the Commission. Schedule 6 to the 2010 Regulation sets
out the maximum costs that are recoverable for legal services provided in or in relation
to a claim for compensation [37].
6.
Clause 100(4) of the 2010 Regulation states that if an appeal is lodged in respect of a
claim or dispute, no amount for costs is recoverable unless the appeal is determined,
is withdrawn or lapses [38].
7.
The appeal was “withdrawn” by the appellants filing an Election to Discontinue and
therefore costs were recoverable [39].
8.
Even though the uninsured employer lodged the appeal application, the Commission
had power to order costs in favour of the employer’s insurer. The reference to insurer
in Sch 6 includes an employer (cl 94 Div 1 Pt 17) [42].
9.
Though the third respondents had not incurred any costs against the appellants, it was
open to make an order in their favour (McCullum v Ifield [1969] 2 NSWR 329, applied
in Dyktynski v BHP Titanium Minerals Pty Ltd [2004] NSWCA 154 at [77]) [45].
28
10.
However, it was appropriate for the costs order to be made in favour of Employers
Mutual because it had a right of subrogation to enforce any order made in favour of its
insured, a reference to insurer in Sch 6 includes an employer and it had a direct
interest in the litigation (Knight v F P Special Assets Ltd [1992] HCA 28; 174 CLR 178
at [34]) [45].
29