Issue 5: May 2010

Da Ros v Qantas Airways Limited [2010] NSWCA 89

(appeal from Da Ros v Qantas Airways Limited [2009] NSWWCCPD 58, O’Grady DP)

Point of law – construction of s 9A of the 1987 Act; "substantial contributing factor" – s  9A(1) of the 1987 Act; employer's liability – whether employment a "substantial contributing factor”; accident occurring during 'slip-time' but in the course of the employment.

Tobias JA; McColl JA; Basten JA

28 April 2010

Facts:

1. On 9 September 2005, the worker, Mr Da Ros, a long-haul flight attendant working with Qantas Airways Limited (‘Qantas’), was in Los Angeles, USA on 'slip-time' between flights.

2. Whilst returning to the hotel accommodation provided by Qantas for its crew, he was knocked off his bicycle and suffered injuries. He claimed compensation under the 1987 Act.

3. On 23 September 2008, the worker filed with the Commission an ARD. On 2 January 2009, the Commission dismissed his claim.

4. The worker appealed to the Commission constituted by the Deputy President.

5. The Deputy President considered whether the worker’s employment was a substantial contributing factor to the injury, pursuant to s 9A(1) of the 1987 Act.

6. The Deputy President found that the employment factors involved in the worker's case "were not important, nor serious, weighty, sizable or large" and, as a result, dismissed the appeal.

7. The worker appealed to the Court of Appeal from that decision. The issues for determination on appeal were:

• whether the proper construction of s 9A of the 1987 Act involved a point of law;
• whether the appellant's employment was a substantial contributing factor to the injury pursuant to s 9A(1) of the 1987 Act, and
• whether any other conclusion was open on the facts as found.

Held: Basten JA allowed the appeal, McColl JA and Tobias JA concurring;

Error of law

The Court held that the Deputy President adopted a construction of s 9A that was erroneous in a material respect. The decision of the Deputy President was set aside and the matter remitted to the Commission for reconsideration of the worker’s appeal according to law, on the basis that the worker’s employment was a substantial contributing factor to the injury.

The Headnote to the Court’s decision states:

“In relation to (i)

1. The proper construction of 'substantial contributing factor' requires it to be considered in its statutory context, and this gives rise to a question of law: [27].

Badawi v Nexon Asia Pacific Ltd t/as Commander Australia Pty Ltd [2009] NSWCA 324; Collector of Customs v Agfa-Gevaert Ltd [1996] HCA 36; 186 CLR 389 cited.

In relation to (ii)

2. The substitution of "serious, weighty, sizable or large" for "substantial" was a wrong formulation on a point of law: [20].

Badawi v Nexon Asia Pacific Ltd t/as Commander Australia Pty Ltd [2009] NSWCA 324; Dayton v Coles Supermarkets Pty Ltd [2001] NSWCA 153, applied.

3. It is erroneous to assess the causal connection by weighing 'employment factors', such as whether the activity constituted an essential incident of the employment or was subject to a specific direction by the employer, against the negligence of the other cyclist, such consideration not being required by s 9A of the Workers Compensation Act 1987 (NSW). The bicycle accident was an incident to which the applicant was exposed in the course of his employment and to which he would not otherwise have been exposed. It is thus open for the appellant's employment to be considered a substantial contributing factor: [21]-[24].

Federal Broom Co Pty Ltd v Semlitch [1964] HCA 34; 110 CLR 626 applied.

In relation to (iii)

4. There being only one conclusion open on the facts, namely that the employment was a substantial contributing factor, orders should reflect that conclusion: [24], [30].”

Fletcher International Exports Pty Ltd v Lott & Anor [2010] NSWCA 63

(appeal from Fletcher International Exports Pty Ltd v Lott and anor [2009] NSWWCCPD 40, Roche AP)

Appeal from Commission; appeal limited to where aggrieved by decision in point of law; whether failure to grant an oral hearing under s 354 of the 1998 Act an error in point of law –  no error shown; whether employment concerned was a substantial contributing factor to the injury; whether there was a failure to consider employment characteristics – s 9A of the 1987 Act – no error in point of law; importance of properly framing grounds of appeal with identification of decision in point of law.

Giles JA; McColl JA; Basten JA

1 April 2010

Facts:

Mr Lott injured his left knee in 2002 whilst working for Fletcher Exports as a station hand. He continued to have intermittent difficulties with his knee but, after surgery, was able to continue normal duties.

On 11 July 2005, Mr Lott commenced employment at a higher wage with Glenam Farming (the second respondent) as a station hand. On the second day of employment, Mr Lott attempted to turn to walk when his left leg collapsed.

Glenam Farming denied liability on the ground that the 2005 incident was a recurrence of the 2002 injury with Fletcher Exports, who also denied liability.

The Arbitrator made an award in favour of Glenam Farming and an award against Fletcher Exports. He assessed probable earnings but for the injury on the basis of earnings with Fletcher Exports. The matter was otherwise referred to an AMS for WPI assessment.

On appeal, Roche AP refused Fletcher’s request to hold an oral hearing. He determined, on the papers, that Fletcher alone was liable to pay compensation to Mr Lott. He was not satisfied that the “strength of the causal linkage” between the injury and Mr Lott’s employment with Glenam Farming satisfied s 9A. He ordered that the amount of weekly compensation be re-determined by an Arbitrator, and confirmed the referral to an AMS.

The appellant’s grounds of appeal in the Court of Appeal were essentially:

• that it was denied procedural fairness by not having an oral hearing
• that Roche AP considered and misapplied s 9A in the absence of the issue being considered or determined between the parties below, after finding that an injury under s 4 occurred during Mr Lott’s employment with Glenam.

Held: Appeal dismissed

1. The employment concerned must be a substantial contributing factor “meaning not the fact of being employed but what the worker was doing in his employment” Dayton v Coles Supermarkets Pty Ltd [2001] NSWCA 153; (2001) 22 NSWCCR 46 at [22] (Giles JA at [38]).

2. Roche AP’s reasons must be read as a whole. He did not confine himself to the precise time at which the injury was suffered. Consideration was given to the occurrence of injury within Mr Lott’s employment circumstances (Giles JA at [39]).

3. The requirements of procedural fairness may be modified by statute and, in any event, what is required can vary according to the circumstances. Procedural fairness is generally satisfied by the opportunity to put evidence and submissions before the tribunal, and Fletcher had the opportunity (Giles JA at [42]).

4. Fletcher asserted complexity of issues as to why an oral hearing was required and it had full opportunity in its submissions to point out the complexity and provide assistance in resolving the issues, but it failed to fully do so. No error in point of law was made out (Giles JA at [51]).

Other matters

Because Roche AP remitted the entitlement to weekly compensation for re-determination, his decision was interlocutory and leave to appeal was required (s 353(4)(a) of the 1998 Act; see Intertan Australia Ltd v Davidson [2000] NSWCA 280 and Akora Holdings Pty Ltd v Ljubicic [2008] NSWCA 339 at [7]).

Qantas Airways Limited v Watson (No 2) [2010] NSWWCCPD 38

(On remitter following Court of Appeal decision – Watson v Qantas Airways Limited [2009] NSWCA 322)

Sections 4, 9A and 11 of the 1987 Act; arising out of or in the course of employment; whether employment a substantial contributing factor to injury received while pilot on slip time in Los Angeles; ordinary recess.

Roche DP

14 April 2010

Facts:

Mr Watson was a pilot employed by Qantas. Whilst in Los Angeles on a “lay over”, he was seriously injured in a car accident which occurred when he was returning to his hotel after visiting friends.  The accident was the fault of the driver of the other vehicle in the collision.

At first instance in the Commission, Mr Watson was awarded compensation.  Qantas appealed and the Presidential member revoked the Arbitrator’s decision and entered an award in its favour.

Mr Watson appealed to the Court of Appeal, submitting that DP Byron erred in point of law in holding that the injury did not fall within the requirements of ss 4 and 9A of the 1987 Act because the worker was not in the course of his employment when the accident happened, and nor did the accident arise out of employment.

The Court of Appeal allowed the appeal and remitted the matter back to the Commission.  The Court determined that the Deputy President erred in law in failing to direct himself in accordance with the reformulated test in Hatzimanolis v ANI Corporation Limited [1992] HCA 21; (1992) 173 CLR 473 (‘Hatzimanolis’) and therefore effectively asked himself the wrong question (for case summary of the Court’s decision please see On Appeal Issue11: Nov 2009).

Held on remitter: Award for respondent.

In the course of employment

1. The test in Hatzimanolis requires a determination or characterisation of the period or periods of work as one overall period or episode of work, or two or more [56].

2. As a long haul pilot, Mr Watson’s employment took him to Los Angeles and required him to remain in, or in the general vicinity of, that city for about 39 hours before his next flight.  Remuneration in a slip port constituted a component of his employment contract.  His slip time was therefore characterised as an “an interval or interlude occurring within an overall period or episode of work” (Hatzimanolis at 483) [60].

3. Having characterised Mr Watson’s period of work as an overall period or episode of work, the question to be determined was whether Qantas “expressly or impliedly…induced or encouraged” him to spend that interval or interlude “at a particular place or in a particular way” [61]. Roche DP was not persuaded that Qantas expressly or impliedly induced or encouraged Mr Watson to spend time with friends one hour twenty minutes drive from Los Angeles. Whilst it was conceivable that Mr Watson considered the trip to visit friends would refresh him, the round trip would have been about two hours forty minutes drive, which many would consider tiring, not refreshing.

4. The fact that other crew members hired cars and engaged in a range of social activities during slip time confirmed Qantas’s evidence that what flight crew choose to do during slip time was “entirely a matter for them”.  However, mere authorisation is not enough, “encouragement and even inducement by the employer” is needed (Kirby A-CJ in WorkCover Authority (NSW) v Billpat Holdings Pty Ltd & Others (1995) 11 NSWCCR 565 (‘Billpat’)) [65].

5. Whether or not the activity may have provided an indirect benefit to Qantas (ie, to “sing the praises” of Qantas when visiting friends), was “simply part of the factual matrix encompassed within the High Court’s requirement” that “regard must always be had to the general nature, terms and circumstances of the employment”.  It is not an element of principle in resolving the question (the Court in Watson) [70].

6. The discount on hire cars was given as a commercial exercise by Budget; it was not arranged by or on behalf of Qantas. It could not be said that Qantas encouraged the use of hire cars whilst in slip time. Overall, the worker failed to establish that he was in the course of his employment at the time of his injury on 26 February 2005.

Arising out of employment

7. The meaning of “arising out of … employment” is settled (Badawi v Nexon Asia Pacific Pty Limited t/as Commander Australia Pty Limited [2009] NSWCA 324; (2009) 7 DDCR 75 (‘Badawi’)).  The majority in Badawi referred to and endorsed the approach in Nunan v Cockatoo Island Docks & Engineering Co Ltd (1941) 41 SR (NSW) 119 (‘Nunan’), where the court “adopted a commonsense approach to the application of the phrase, noting that it involved a causative element” (Badawi at [73]). Whether the particular injury arose out of employment is a matter to be inferred from the facts as a matter of common sense (Badawi at [76], citing Nunan).

8. Contrary to the worker’s submission, Roche DP refused to take judicial notice that the risk of an accident was increased in Los Angeles. The essential requirement before a court (or tribunal) will take judicial notice of a fact is that “the fact … be of a class that is generally known as to give rise to the presumption that all persons are aware of it” (Holland v Jones [1917] HCA 26; (1917 23 CLR 149). Roche DP was not satisfied that knowledge about traffic conditions and accident rates in Los Angeles is knowledge not reasonably open to question or common knowledge (applying s 144 of the Evidence Act 1995). There was also no evidence that Mr Watson was subjected to an abnormal risk of injury by being exposed to Los Angeles traffic.

9. The “but for” test is not the correct test of causation in workers’ compensation cases (see Nunan and Zinc Corporation Ltd & another v Scarce (1995) 12 NSWCCR 566 (‘Scarce’)). The test has many shortcomings. To say that, but for Mr Watson’s employment, he would not have been in Los Angeles and would not have been injured is analogous to a worker saying, “If I had not gone to work today, I would not have been injured” [85], [86].

10. It is possible that an injury can arise out of employment although it has not been received in the course of employment (Carr v Donnelly [1937] WCR 294; Tarry v Warringah Shire Council [1974] WCR 1; Davis v Mobil Oil Australia Limited (1988) 4 NSWCCR 8). However, Mr Watson failed to establish that, in the circumstances of the present case, the relevant employment “was so connected with the loss or injury that, as a matter of ordinary common sense and experience, it should be regarded as a cause of it” (Clarke JA in Scarce).

Section 9A

11. If Roche DP was incorrect and Mr Watson’s injury both arose out of and in the course of employment, s 9A was considered. The majority judgment in Badawi stated (at [97]) that, if an employee is injured during an interval or interlude in the employment, then “what the employee is doing during such interval or interlude is a consideration to which the decision maker will have regard in determining whether the employment is a substantial contributing factor to the injury”.

12. At best, employment provided the location of the injury, but the injury was caused by the actions of an intoxicated driver and employment did nothing to effectively contribute to it. Therefore, even accepting that the injury arose out of the employment, the employment was no more than a background matter that had limited causal relevance to the injury. The connection between the employment and the injury was not “real and of substance”, but was remote and tenuous. That the injury happened in Los Angeles during an overall period of work was a coincidence of event, not a substantial contributing factor to the injury [97], [98].

Ordinary recess

13. The term “place of employment” is not defined in the 1987 Act. It extends to the employer’s premises and to wherever workers perform their duties under their contract of employment.  At its highest, the crew hotel was a meeting place and/or a pick-up and drop-off point.  Flight crew performed no work there and were not even required to stay there.  It was not a place of employment [107].

14. Even if the hotel was a place of employment, Mr Watson’s absence from the hotel was neither an “ordinary recess” or an “authorised absence”. Mr Watson did not require authorisation to visit friends. He did not need, nor seek, permission to do so.

15. Allowing for the fact that Mr Watson’s stay in Los Angeles was an overall period or episode of work, the visit to his friends had none of the features associated with an “ordinary recess” as explained in the authorities. It was not  “a relatively brief interruption in an otherwise continuous period of work” (Landers v Dawson [1964] HCA 35; (1964) 110 CLR 644). Mr Watson’s time in Los Angeles “was entirely his own”.

16. The alternative argument was that the entire slip time in Los Angeles was an ordinary recess. However, Roche DP was not satisfied that a break of over 39 hours comes within the terms of s 11, which is intended to cover relatively brief interruptions to work, eg, a lunch break, that start and finish within a 24-hour period (see second reading speeches referred to by Powell JA in Tooth & Co Ltd v Injac (1994) 10 NSWCCR 437).

Spears v Department of Ageing, Disability & Homecare of NSW [2010] NSWWCCPD 35

Section 354(7A)(b) of the 1998 Act; proceedings dismissed at teleconference; whether dismissal order created an issue estoppel or res judicata estoppel in subsequent proceedings between the same parties; whether a dismissal order at a teleconference is a final decision on the merits; meaning of “lacking in substance”; purpose of teleconferences.

Roche DP

7 April 2010

Facts:

Ms Spears alleged a primary psychiatric injury as a result of her employment. The respondent denied liability. Commission proceedings commenced in February 2009, but the Arbitrator dismissed the ARD under s 354(7A)(b) of the 1998 Act because Ms Spears had not obtained a medical report from a qualified or treating psychiatrist. In the absence of that report, the Arbitrator held that the applicant had not provided the Commission or the respondent with expert medical evidence to establish a prima facie case.

Ms Spears lodged a second ARD alleging the same injuries and claiming the same compensation.

The respondent conceded injury. Despite that concession and despite the respondent making no application, the Arbitrator dismissed the second ARD on the ground that, by reason of issue estoppel and res judicata estoppel, the orders made by the first Arbitrator prevented Ms Spears from pursuing the same compensation against the same employer in the second ARD.

Allianz’s s 74 notice disputed injury, s 9A, incapacity and s 60s. It referred to s 11A, but provided no particulars of that alleged defence. It did not notify issue estoppel or res judicata estoppel as issues in dispute.

On appeal, the respondent’s solicitors advised that, though they continued to act for the respondent employer, they did not wish to file a Notice of Opposition to the appeal.

Held: Arbitrator’s decision revoked, matter remitted to new Arbitrator.  

1. Section 289A of the 1998 Act is clear that a dispute cannot be referred for determination to the Commission unless it has been previously notified (s 289A(1)). Whilst it is appropriate for an Arbitrator to raise evidentiary and legal issues that the parties have not properly addressed, it is not part of an Arbitrator’s function to raise entirely new issues in dispute that are not in the s 74 notice.

2. However, even if the insurer had identified issue estoppel and res judicata estoppel as issues in dispute in the s 74 notice, it could not have succeeded on those issues.  Before a res judicata estoppel can arise, there must be a final decision on the merits (Spencer Bower at [19]) [27].

3. An order under s 354(7A) dismissing an ARD at a teleconference is usually an interlocutory order and not a final order on the merits (see Little v State of Victoria (1998) 4 VR 596; Wickstead v Browne (1992) 30 NSWLR 1 at 11; Graziani v Burrangong Pet Food Pty Ltd [2007] NSWWCCPD 215; Hawke v Stanyer & ors trading as Stanyer Partnership [2007] NSWWCCPD 208; Nott v The Western Stores Limited & ors[2007] NSWWCCPD 83) [28].

4. Court orders must always be interpreted in the context of the relevant governing legislation.  The dismissal of the first Application at a teleconference was a procedural step in the dispute resolution process. As it was not a hearing on the merits, it could not be suggested that an order dismissing an application under s 354(7A) at the teleconference stage was a decision on the merits. The fundamental requirement for an issue estoppel or res judicata was lacking [35].

5. The leading authority on the summary dismissal of proceedings is General Steel Industries Inc v Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 (Barwick CJ at 129):

“The test to be applied has been variously expressed; ‘so obviously untenable that it cannot possibly succeed’; ‘manifestly groundless’; ‘so manifestly faulty that it does not admit of argument’; ‘discloses a case which the Court is satisfied cannot succeed’; ‘under no possibility can there be a good cause of action’; ‘be manifest that to allow them’ (the pleadings) ‘to stand would involve useless expense’.”

6. The Arbitrator held that the worker’s case was “lacking in substance” because her solicitors had not attached a report from a qualified psychiatrist. He failed to consider whether the worker’s evidence, together with her GP’s evidence (which was supportive), was sufficient to establish a prima facie case.

7. The meaning of the phrase “lacking in substance” depends on the legislative context in which it is used.  The Court of Appeal held it would be “inappropriate” to attribute to the phrase a meaning other than “not reasonably arguable” (Ipp JA with Beasley and Bryson JJA agreeing) in The Owners Corporation of Strata Plan 4521 v Zouk [2007] NSWCA 23 at [45].

8. A matter should not be dismissed under s 354(7) unless the test in General Steel is satisfied and the matter is clearly “not reasonably arguable”. The lack of a report from a qualified psychiatrist did not necessarily mean the case was lacking in substance [43].

9. It follows that no issue estoppel or res judicata estoppel arose because the first Arbitrator did not decide any issues, and the second Arbitrator erred in finding to the contrary.

Other matters

The order made by the second Arbitratror was made after a hearing on the merits and was therefore not an interlocutory order. Given the second Arbitrator’s findings, the appropriate order, had those findings been correct, should have been an award for the respondent. Such order would have avoided the uncertainty that arises from the expression “application dismissed”, which is more appropriate when dealing with interlocutory applications.

Vivaldo v Uniting Church in Australia t/as Lucan Care [2010] NSWWCCPD 41

Compensation for a consequential loss; evidence; unsatisfactory preparation of case and appeal by applicant’s solicitor.

Roche DP

20 April 2010

Facts:

In 2002, Ms Vivaldo received lump sum compensation in respect of loss of use of both legs (knees), back and left index finger, due to a 1999 injury when she fell at work. In 2004, the Commission ordered the respondent to pay weekly benefits for that injury.

Ms Vivaldo’s knees continued to deteriorate. She underwent surgery in 2007 to her left knee and she will most likely require surgery to her right knee. Because of her knee symptoms, Ms Vivaldo started using a walking stick and she had to “lever” herself up from chairs. As a result of that activity, she alleged that she developed symptoms in her shoulders, and made a claim for loss of use of both arms.

The s 74 notice disputed liability on the ground that the alleged shoulder injuries were unrelated to the injury in 1999. The insurer’s medical evidence suggested that any shoulder injury was due solely to an underlying degenerative condition.

The Arbitrator made an award for the respondent, concluding that Ms Vivaldo had not discharged the onus of proving that the condition of her shoulders had resulted from her knee injuries in 1999.

Held: Arbitrator’s decision revoked. Matter to be remitted to Registrar for referral to AMS to assess loss of use of the arms.

1. To succeed in a claim for compensation for a consequential loss, ie, a loss alleged to have resulted from a previous compensable injury to the knees (see Roads & Traffic Authority (NSW) v Malcolm (1996) 13 NSWCCR 272), the worker had to establish that the symptoms and restrictions in her shoulders resulted, in whole or in part, from the effects of the 1999 injury. The test for causation is “has the loss ‘resulted from’ the relevant work injury?” (see Sidiropoulos v Able Placements Pty Limited (1998) 16 NSWCCR 123; Rail Services Australia v Dimovski & Anor [2004] NSWCA 267; (2004) 1 DDCR 648).

2. It was undeniable that the worker injured her knees in the 1999 incident and that, as a result of the injury, her knee symptoms increased significantly, causing permanent loss of efficient use of each leg. In light of the 2002 settlement, the insurer’s qualified specialist’s conclusion that the aggravating effect of the 1999 injury had ceased was untenable.

3. Radiological investigations and the worker’s evidence, although brief and barely adequate, were sufficient to establish that Ms Vivaldo experienced symptoms in her shoulders as alleged. It was of no consequence that no specialist commented on the investigations.

4. The worker’s qualified occupational physician took a consistent history of the onset of shoulder symptoms and concluded that the symptoms resulted from her having to put pressure on her arms while getting up from a seated position. The explanation was brief, but clear and succinct, and satisfied the test in Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705 in that it explained the basis for his conclusion.

5. It was unclear whether Ms Vivaldo was referred to a specialist by her GP or, if she was, whether she saw that specialist. To the extent that the Arbitrator relied on the absence of a report from a specialist to draw an adverse inference against the worker under Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298, she erred.

6. The causal chain between the 1999 injury and the shoulder complaints was unbroken and, as a matter of common sense, Ms Vivaldo’s shoulder symptoms resulted from the 1999 injury (Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452).

7. In the absence of evidence of any other trauma to the shoulders, it is clear that Ms Vivaldo’s shoulder symptoms resulted from the effects of the 1999 injury to her knees.  The symptoms did not merely worsen with the passage of time, but were either caused or aggravated by her having to place excessive weight on her shoulders because of the effects of her 1999 injury.  It is well established that there is an aggravation of a disease if it is made more grave or more serious in its effects upon the patient (Federal Broom Co Pty Ltd v Semlitch [1964] HCA 34; (1964) 110 CLR 626 at 637 and 639).

Haddadi v Bunnings Group Limited [2010] NSWWCCPD 43

Section 40(2A) of the 1987 Act; suitable employment; unreasonable rejection of suitable employment.

Roche DP

23 April 2010

Facts:

Mr Haddadi, a co-ordinator at Bunnings, suffered a work injury on 21 July 2006 when he tripped and fell down stairs, injuring his shoulders and right knee. Liability was accepted. Following surgery to his right shoulder, he ultimately returned to full-time work with restrictions on lifting, pushing and pulling heavy objects.

By letter dated 11 August 2008, Mr Haddadi resigned from his position as co-ordinator, but requested part-time employment with Bunnings. Bunnings advised Mr Haddadi that it was not possible to accommodate his request and his employment would cease immediately.

Around the same time (exact date unknown), Mr Haddadi purchased a building franchise which he continues to operate in his own name. In January 2009, Mr Haddadi sought weekly benefits from 11 August 2008 to date and continuing, plus s 60s.

CGU disputed liability on the grounds that, by reason of his resignation, Mr Haddadi had rejected suitable employment, and his entitlement was to be calculated under s 40(2A) of the 1987 Act. It was asserted that his current weekly wage rate whilst suitably employed was equal to his current weekly wage rate in his pre-injury employment and he therefore had no entitlement to weekly benefits.

The Arbitrator made an award in favour of Bunnings on the ground that Mr Haddadi had unreasonably rejected suitable employment and, in the alternative, that his ability to earn was equal to or exceeded his probable earnings but for injury. He said that the s 60 claim failed for the same reasons.

The issues on appeal were (i) was Mr Haddadi employed in suitable employment at the time he resigned and (ii) was his resignation an unreasonable rejection of that employment?

Held: Arbitrator’s decision revoked. Matter remitted to a different Arbitrator for re-determination.

1. Whether the duties Mr Haddadi performed at the time of his resignation were reasonable depended on whether they were within the activities in the GP’s medical certificates. The respondent did not call evidence from Mr Haddadi’s managers dealing with his allegation that he had to perform duties outside his restrictions, while Mr Haddadi’s contemporaneous medical evidence corroborated his complaints that he was required to perform beyond his medical restrictions. Mr Haddadi had sought assistance from the injury management officer at Bunnings to “help him out”. If his duties had been suitable, it would be unlikely he would have made such a request.

2. Any assessment of whether Mr Haddadi’s conduct was unreasonable depended on an assessment of his state of knowledge at that time (per Davies A-JA, Handley & Beazley JJA agreeing, in Freightcorp v Duncan [2000] NSWCA 309 at [19], citing Fazlic v Milingimbi Community Inc[1982] HCA 3; (1982) 150 CLR 345; see also Hines v WorkCover/HIH (Transfer Maintenance Pty Ltd) Corporation [2000] SAWCT 171; McDonald v North Coast Area Health Service[2009] NSWWCCPD 50).

3. Though he did not admit it, Mr Haddadi resigned to pursue his own business interests by purchasing a building and maintenance franchise, as evidenced by purchase receipts of tools and equipment. However, his wish to commence his own business was not unreasonable as the work would be within his medical restrictions and enable the flexibility he did not have at Bunnings. Given his experience and background, his resignation was not unreasonable, but logical and rational.

4. Mr Haddadi’s solicitor had not explained the basis of the figures claimed in the wage schedule, which appeared to be inconsistent with BAS records. Given the unsatisfactory state of evidence, the matter was remitted to another Arbitrator for determination of entitlement to s 40 weekly compensation.

5. The Arbitrator’s reasoning that the medical expenses claim “failed for the same reasons” as the claim for weekly compensation failed was incorrect. That a worker is not entitled to weekly compensation does not determine his or her entitlement to compensation for medical expenses. The s 54 notice did not dispute Mr Haddadi’s entiltment to medical expenses. However, Mr Haddadi did not seek a specific amount for medical expenses, but claimed for ongoing physiotherapy, gym and hydrotherapy. The Commission has no power to make an award in the nature of a declaration for future expenses (Widdup v Hamilton [2006] NSWWCCPD 258; (2006) 5 DDCR 85).

6. As it was unclear whether specific treatment was disputed, this would need to be clarified at the re-determination.

Irvin v LA Logistics Pty Ltd and anor [2010] NSWWCCPD 40

Hearing loss; fresh evidence on appeal; s 74; s 261; date of injury, and when worker first became aware of having received an injury.

Keating P

16 April 2010

Facts:

Mr Irvin brought proceedings claiming compensation for 4% WPI against two former employers, alleging that he suffered industrial deafness from working for both as a truck driver and being exposed to noise from truck motors, mixers, jackhammers, compressors and plant machinery.

Both employers disputed that Mr Irvin’s employment with them was noisy.

The second respondent, Cemex, issued a poorly drafted notice under s 74 in which it relied on eight separate bases for rejecting the claim and relied upon eleven sections of the 1987 Act and the 1998 Act.

At the arbitration hearing, Cemex submitted there was a preliminary issue to be determined, namely, that the worker was prohibited from recovering compensation because he had failed to make a claim within six months after the injury as required by s 261(1). In addition, Cemex submitted that the failure could not be excused under s 261(4) because more than three years had elapsed between the date of injury and the date of the claim for compensation.

The argument proceeded before the Arbitrator on the basis it was common ground that Mr Irvin first claimed compensation on 22 December 2008, when Mr Irvin’s solicitors wrote to Cemex, making a claim for lump sum compensation on his behalf.

The Arbitrator found against the worker on the preliminary issue, and entered an award for the first and second respondents. The Arbitrator determined that the “real” date of injury was 30 September 2005, being the date Mr Irvin was last employed by Cemex.  It was conceded that the claim for compensation was not made until 22 December 2008. Therefore, as more than six months had elapsed, the Arbitrator determined that the worker failed to satisfy s 261(1). The Arbitrator found that there was no evidence to excuse the delay under s 261(4).

The worker appealed and sought to rely on additional statement evidence from Mr Irvin and his solicitor.  Mr Irvin alleged this evidence established that, contrary to submissions at the arbitration, notice of claim was made in February 2008, not 22 December 2008. Mr Irvin alleged that he was misled by erroneous submissions by the solicitor for Cemex in relation to the date of the claim, noting that the same claim number appeared on the report of Dr Seymour dated 26 May 2008 relied on by Cemex, and from which the inference should be drawn that the date of claim pre-dated this examination date and Cemex was aware of this fact.

Held: Additional evidence admitted on appeal – Arbitrator’s decision revoked – matter remitted to a different arbitrator

Further evidence was admitted in the interests of justice because:

1. The s 74 notice issued by Cemex did not meet the requirements of clearly stating the reasons for disputing a claim.  It failed to clearly identify the issues giving rise to the dispute.

2. Numerous recent cases in this Commission have confirmed that referring to sections of the legislation, without clearly articulating the issues in dispute, is not proper compliance with s 74 (see Rinker Group Pty Limited v Mackell [2008] NSWWCCPD 100; NSWWCCPD 124;Babylon Property & Cleaning Services Pty Limited v Hormoz [2009] NSWWCCPD 161;Fletcher International Exports Pty Ltd v Lott and anor [2009] NSWWCCPD 40; Sydney Night Patrol & Inquiry Co Pty Ltd v Spasevski[2010] NSWWCCPD 7; Hobden v South East Illawarra Area Health Service [2010] NSWWCCPD 13; Department of Ageing, Disability and Homecare v Mariniello [2010] NSWWCCPD 17).

3. At the telephone conference, it appeared to be common ground that the only matter to be determined concerned which of the two respondents was the last employer to have employed the worker in employment to the nature of which the injury was due (T1.53).

4. Mr Irvin’s counsel relied on what was said at the telephone conference, and was taken by surprise when the s 261 notice of claim issue was raised at the commencement of the hearing (T4.48).

5. If the issue of the worker’s compliance with s 261 had been clearly articulated in the s 74 notice, or had Cemex’s solicitor sought leave to dispute the notice of claim at the telephone conference, the prejudice to the worker might have been overcome.

6. It should have been apparent to the Arbitrator and the parties that Dr Seymour, had examined Mr Irvin on 26 May 2008, seven months earlier. The claim number referred to by Dr Seymour in his report was the same claim number referred to in Cemex’s s 74 notice. This would not be possible if the claim was not made until December 2008.

7. The lodgement of a claim prior to December 2008 was consistent with Mr Irvin’s further statement evidence that he lodged his claim in February 2008.

8. Proceedings before Arbitrators are not to be regarded as a trial run. Cases are to be fully prepared and argued. Regrettably, the appeal in this matter was provoked by poor preparation on both sides of the record.

• The worker’s statement was incomplete and inaccurate on critical issues.
• His counsel made concessions during the course of the hearing that were not warranted.

9. The s 74 notice and the teleconference are designed to ensure that parties clearly understand the issues to be determined by an arbitrator if the parties are unable to resolve the dispute themselves. That objective will be thwarted if respondents are permitted, in the absence of an application for leave, to ambush applicants at the arbitration hearing with technical defences that have not been clearly identified.

Held: Revoked Arbitrator’s decision – evidence insufficient to re-determine – matter remitted.

Whittingham v Ascott Air Conditioning Pty Ltd [2010] NSWWCCPD 36

Extension of time to appeal; s 352(4) of the 1998 Act; injury at a Christmas party at the employer’s premises; ss 4, 9A and 14 of the 1987 Act; alcohol supplied by the employer; excessive consumption of alcohol; whether worker’s conduct in the course of employment; gross misconduct; serious and wilful misconduct.

Roche DP

31 March 2010

Facts:

Mr Whittingham, a sheet metal offsider, suffered injuries to his back and right shoulder, and fractured his ribs at a staff Christmas party where he was said to have been affected by alcohol. He alleged being tackled by the employer’s managing director, Mr Scott, who was also intoxicated. Mr Scott denied tackling Mr Whittingham, but recalled the worker injuring himself when he fell across a gutter. Both the worker and Mr Scott conceded they did not recall the entire incident due to their levels of intoxication.

Mr Whittingham’s supervisor, who was not drunk, had asked Mr Whittingham to “settle down”, but was ignored. He saw Mr Whittingham charge at Mr Scott, but did not notice the worker being injured. He later saw Mr Whittingham on the kerb of the garden. Mr Whittingham later complained he was a bit sore because he struck his midsection and chest falling onto the kerb.

The ARD sought ss 60/66/67 for injuries sustained on 19 December 2008 and for a separate incident involving his thumb on 15 January 2009 (conceded by the employer).

The respondent accepted that the worker was in the course of his employment while at the party, but argued that he took himself outside the course of employment when he attempted to charge at Mr Scott and fell over.

The Arbitrator found in favour of the employer in respect of the 19 December 2008 incident due to a self-inflicted injury as a result of gross misconduct.

Held: Arbitrator’s decision revoked in respect of the 19 December 2008 incident. Matter remitted for further orders consistent with DP Roche’s findings. Arbitrator’s decision in respect of 15 January 2009 injury confirmed.  

1. The circumstances in which Mr Whittingham received his injury were important. Mr Whittingham’s behaviour at the party was fuelled by an unlimited supply of alcohol provided freely by his employer at a social function where his boss was also intoxicated. The employer impliedly encouraged the excessive consumption of alcohol and took no effective steps to stop it when it was in a position to do so.

2. Mr Whittingham’s injury did not result from an assault where he was the aggressor, but from his conduct while drunk at a work-sponsored and funded social function. It cannot be said that Mr Whittingham’s conduct either took him outside the course of his employment or amounted to wilful gross misconduct.

3. “Wilful” connotes that the worker must have acted deliberately. S/he must have had knowledge of the risk of injury and, in the light of that knowledge, proceeded without regard to the risk (Sawle v Macadamia Processing Co Pty Ltd (1999) 18 NSWCCR 109).  In view of his intoxication, Mr Whittingham was incapable of assessing the risks involved and his actions could not be described as wilful [73].

4. To satisfy s 9A, it is the “employment concerned” and not what the worker was doing at the actual time of the injury, that is important. The causal connection between the employment and the injury must be “real and of substance” (Badawi v Nexon Asia Pacific Pty Ltd t/as Commander Australia Pty Ltd [2009] NSWCA 324; (2009) 7 DDCR 75).  Given the time and place of the injury, and the general circumstances of the employment, s 9A was satisfied.  The injury occurred at a social function organised and supervised by the employer.  Whether Mr Whittingham’s conduct was out of character was irrelevant.  His conduct (and injuries) resulted from the general circumstances of his employment which was the relevant causal factor.

AMP Bank Limited v Ayoub [2010] NSWWCCPD 37

Section 11A of the 1987 Act.

Moore ADP

14 April 2010

Facts:

Ms Ayoub, a senior product manager, commenced employment with AMP Bank Limited (‘AMP’) on 30 August 2004 and was made redundant on 15 November 2007. She subsequently claimed that she developed a psychiatric condition as a consequence of constant bullying, harassment and intimidation by other staff and her manager.  She made no formal claim with AMP’s insurer, Allianz, until 15 January 2008.

The insurer declined liability on the basis that AMP acted in a reasonable manner with regard to both performance appraisal and the redundancy which was brought about by AMP’s restructure.

Ms Ayoub lodged an ARD, seeking lump sum compensation, medical expenses and weekly benefits from 15 November 2007.

The Arbitrator found in favour of Ms Ayoub, determining that she suffered a psychiatric injury arising out of, or in the course of, her employment with AMP on 15 November 2007. The Arbitrator determined that the action taken by AMP was not reasonable, either as part of its performance review or in the course of the retrenchment process.

AMP appealed, focusing on a challenge to the Arbitrator’s findings that their actions in relation to Ms Ayoub’s performance appraisal and retrenchment were not reasonable.

Held: Arbitrator’s decision revoked – new decision substituted, award in favour of the appellant.

1. Moore ADP considered in detail all the evidence before the Arbitrator, and found that the performance appraisal carried out in March 2007 in order to assess Ms Ayoub’s performance was part of a limited discrete process with a recognised procedure, in line with the determination of Geraghty J in Irwin v Director General of School Education (unreported, 18 June 2008, matter number 14068 of 1997) as cited by Neilson CCJ in Bottle v Weiland Consumables Pty Ltd (1999) 19 NSWCCR 135.

2. AMP did not fail to act reasonably in the manner determined by the Arbitrator because Ms Ayoub was provided “formal feedback” and was given invitations to open discussions and table her concerns.

3. Ms Ayoub’s performance assessment was not completed following the departure of her former superior as she claimed, and was concluded by her new superior shortly before the meeting in March 2007. It was then ‘neither necessary nor appropriate to provide feedback to Ms Ayoub or comment on her “key performance factors” prior to her receiving her assessment’ (at [131]). On this point, Moore ADP distinguished the facts of the case from Dunn v Department of Education and Training (2000) 19 NSWCCR 475.

4. There was neither sufficient nor verifiable evidence in support of Ms Ayoub’s claims of bullying, harassment, racial, sexual or gender discrimination in her workplace.

5. Having regard to the consideration made on the reasonableness of an employer’s action in Pirie v Franklins Ltd (2001) 22 NSWCCR 346, there was no evidence that the relationship between the parties formed part of the process of Ms Ayoub’s retrenchment (at [148]).

6. Unlike in Pirie, AMP exerted effort to “cushion the impact of the retrenchment” by advising Ms Ayoub that she had access to a counsellor, the Employee Assistance Program and a Career Management Consultant at their expense. As a result, Moore ADP found that the process adopted by AMP in relation to Ms Ayoub’s retrenchment was reasonable in the circumstances of the case, and to a “reasonable observer” (cf  Buxton v Bi-Lo Pty Ltd (1986) 16 NSWCCR 237 per Walker CCJ at [97]).

Rail Corporation NSW v Lam Luu [2010] NSWWCCPD 44

Monetary threshold on appeal; s 352(2) of the 1998 Act; definition of compensation.

Keating P

27 April 2010

Facts:

Mr Luu lodged an Application to Resolve a Workplace Injury Management Dispute in the Commission. He alleged that he had suffered a psychological injury as a result of harassment and bullying in the workplace. The dispute concerned the employer’s allege failure to:

• Provide a current injury management plan.
• Undertake a return to work assessment.
• Appoint a rehabilitation provider to undertake Chapter 3 requirements.

RailCorp filed a Reply. It denied:

• that the claim had been duly made in accordance with s 65(1)(c) of the 1998 Act.
• that Mr Luu suffered a significant workplace injury as defined in the 1998 Act.
• that it has an obligation to implement an injury management plan, return to work plan or provide suitable duties.

RailCorp relied on ss 4, 9A, 11A and 61 of the 1998 Act and s 14 of the 1987 Act and that the worker resigned his employment prior to lodging a claim form and WorkCover certificate.

The Registrar by her delegate issued a “Recommendation” that the Respondent appoint a rehabilitation provider.

RailCorp requested the proceedings be referred to the Commission for determination by an Arbitrator pursuant to s 308 of the 1998 Act.

The matter was listed for an arbitration hearing. The Arbitrator ordered that, pursuant to s 310 of the 1998 Act, the Respondent comply with the recommendations of the Registrar.

RailCorp appealed.

Held: leave to appeal refused.

1. RailCorp’s submission that “compensation” as defined in s 4 of the 1998 Act meant compensation under the Workers Compensation Acts and included any monetary benefit under those Acts was rejected.

2. The reasoning in Department of Community Services v Hickey [2006] NSWWCCPD 320 and Sydney Opera House Trust v Sykes [2006] NSWWCCPD 227 confirmed.

3. The word “benefit” must be read in the context of the legislation. Part 3 of the 1987 Act sets out the “compensation–benefits” that are payable. They include weekly compensation during total or partial incapacity for work (s 33), lump sum compensation in the event that the injury has resulted in permanent impairment (ss 66 and 67), death benefit compensation (ss 25, 26 and 27), compensation for the cost of hospital, medical and rehabilitation treatment (s 60), and compensation for domestic assistance (s 66AA).

4. The reference to “occupational rehabilitation service” in s 60 needed to be considered in the context of that section. Section 60 provides for the payment of those expenses “if, as a result of an injury received by a worker, it is reasonably necessary” for such services to be provided.

5. The quotation from IOH (rehabilitation provider) did not come within the terms of s 60 because:

• it has not been determined that the cost is reasonably necessary as a result of an injury;
• section 60 is an indemnity provision, which only applies as and when the cost of the treatment has been incurred (New South Wales Sugar Milling Co-operative v Manning (1998) 44 NSWLR 442; Widdup v Hamilton [2006] NSWWCCPD 258; and Roads & Traffic Authority of NSW v Harwood [2010] NSWWCCPD 24
• if a cost was incurred, it would be incurred as a result of an order of the Commission pursuant to Chapter 3 of the 1998 Act, which deals with workplace injury management and not s 60 of the 1987 Act, which deals with medical expenses.

6. The object of Chapter 3 is to establish a system that seeks to achieve optimum results in terms of the timely, safe and durable return to work for workers following workplace injuries (s 41(1) of the 1998 Act). It applies even when there is a dispute as to liability (s 41A) (see Divertie v Startrack Express Pty Limited (formerly Neilsen Brame Pty Limited) [2008] NSWWCCPD 45 (‘Divertie’)).

7. “Injury management” is defined in s 42 of the 1998 Act to mean “the process that comprises activities and procedures that are undertaken or established for the purposes of achieving a timely, safe and durable return to work for workers following workplace injuries”.

8. The services contemplated, including labour market research, psychological assessment and report, training for job-seeking skills, interview technique, resume development, job-seeking for six months (including pursuing job placement program and work trial), and additional case management services (monthly reports, liaison with treating professionals and employer as per WorkCover guidelines) were not “compensation” or a “monetary benefit”, but were more correctly categorised as “injury management” activities under Chapter 3 of the 1998 Act.

9. The quotation by IOH did not come within the definition of “compensation” within the 1998 Act and, for that reason, there was no compensation at issue on appeal (s 352(2)).

Leave to appeal refused.

Transley Solutions Pty Ltd v Steve Kagiorgis [2010] NSWWCCPD 45

Injury and causation; weight of the evidence; onus of proof; interlocutory decision.

O’Grady DP

29 April 2010

Facts:

Mr Kagiorgis was employed as a truck driver with the Appellant in January 2002, with duties including transporting, loading and unloading large bags of discarded clothing from a charitable institution most days of the week.

On 2 October 2003, he fell from the truck to the ground whilst unloading large bags of clothing at a rubbish depot, landing heavily on his right knee. As he was prone on the ground, one of the bags fell off the truck and struck him on his lower back.  He sought medical treatment the following day and has been unable to resume duties due to alleged incapacity since that time. The insurer paid weekly benefits until October 2005.

Mr Kagiorgis had a lengthy history of hospital admissions, following a diagnosis of spinal infection. In 2005, he was advised to undergo spinal surgery, but the insurer declined liability for the surgical treatment. He underwent spinal fusion as a public patient on 10 April 2006.

On 29 July 2008, Mr Kagiorgis claimed lump sum entitlements in respect of back impairment. The insurer declined liability. An ARD was lodged on 9 July 2009. The Appellant denied that Mr Kagiorgis injured his back necessitating surgery.

The matter came before an Arbitrator who, on 4 September 2009, found that Mr Kagiorgis’s spinal infection was caused by the fall, and made findings of fact that there was a cut or abrasion to his right knee, a spinal haematoma and a subsequent infection.

The employer appealed. The main issue on appeal was whether or not the fall caused the pathology that necessitated spinal surgery, and whether or not employment was a substantial contributing factor to the injury.

Mr Kagiorgis alleged that the appeal was filed out of time, and argued that the leave to appeal should be refused because the Appellant failed to seek a review following the Arbitrator’s decision made on 4 September 2009, the date relevant findings were made before referral to an AMS.

Held: Arbitrator’s decision, for reasons stated in the judgment, confirmed.

1. The Appellant’s election not to challenge the Arbitrator’s findings of fact made on 4 September 2009, concerning the cut and haematoma following the fall, did not create a bar to that party seeking leave to challenge the Arbitrator’s final determination made on 24 December 2009. The findings made on 4 September 2009 were a step in the proceedings leading to remitter and the final orders made on 24 December 2009.

2. Those findings were made at an interlocutory stage of the proceedings. The fact that the Appellant did not elect to challenge the Arbitrator’s finding at that interlocutory stage did not prevent the Commission at a later stage from reviewing that factual finding which formed the basis of the final order made on 24 December 2009 (at [28]).

3. The Arbitrator was correct in finding that a cut or abrasion to the worker’s right knee resulted from the fall (at [133]).

4. The Arbitrator did not provide sufficient reasons for rejecting the opinions of the employer’s medical witnesses.  Upon review of the medical evidence ([149] to [161]), it was found more probable than not that the infective process which developed in the worker’s spine was causally related to the cut or abrasion which had been found to have occurred.

Rafoo v Rafinc Pty Ltd [2010] NSWWCCPD 42

Nature and extent of an aggravation of a pre-existing injury; weekly benefits and lump sum compensation.

Moore ADP

21 April 2010

Facts:

Mr Rafoo, a service station manager and console operator, commenced work with Mobil Oil Australia in February 1995. He became a permanent employee following the change of the franchise name to Rafinc Pty Ltd (‘Rafinc’) in June 1999. Prior to this, in 1983, he injured his back at work with AWA Thorn Pty Ltd, and settled his claim for compensation in 1985.

On 12 December 1998, he again injured his back following a car accident on his way to Rafinc. He received a settlement in June 2001 for this injury.

In October 2001, Mr Rafoo injured his back for the third time when he struck the edge of an open cupboard at work. He did not seek treatment and remained at work until 8 October 2003. On that day, he injured his back again while lifting boxes of soft drinks. On 9 October 2003, he further injured his back after lifting boxes of soft drinks. He ceased work after that day and went on pre-arranged holidays on 11 October 2003 without seeking treatment. He alleged that his back deteriorated, requiring him to eventually seek treatment on 17 October 2003. He has not worked since then.

The insurer accepted liability and made payments of weekly benefits and medical expenses up to 19 March 2004.

In 2005, Mr Rafoo brought proceedings in the Commission for lump sum compensation for the back and both legs as a consequence of the injuries in 2001 and on 8 October 2003. The matter was referred to an AMS, who assessed nil permanent impairment. His medical appeal from the AMS was declined.

In 2009, Mr Rafoo brought proceedings in the Commission, claiming lump sum compensation for the injury on 9 October 2003, and weekly benefits and medical expenses as a result of all three injuries. Rafinc did not challenge the factual circumstances and consequences of the injury in October 2001, but disputed those of the injuries in October 2003.

The Arbitrator found that Mr Rafoo suffered injury in October 2001, on 8 and on 9 October 2003, but found that there were no continuing consequences from those injuries beyond 1 August 2005. She made an award of weekly payments from 20 March 2004 to 1 August 2005 and declined to refer the claim for lump sum compensation for medical assessment.

Mr Rafoo appealed.

Held: Arbitrator’s decision confirmed.

1. The medical practitioners who provided reports for both parties offered opposing views, but were both valid opinions.  On balance, the Arbitrator was correct in accepting the significant and compelling opinions of those medical practitioners whose evidence was based on similar radiological investigations prior to, and post, Mr Rafoo’s injuries, and the ‘independent’ assessment by the AMS, Dr Khan, in August 2005.

2. The weight of evidence supported the Arbitrator’s findings that Mr Rafoo’s demonstrated pathology did not result from the work events, and that the work injuries were of a limited and temporary nature.  Being of such nature, there was no basis for the Arbitrator to remit the matter for referral to an AMS for medical assessment (see WorkCover New South Wales v Evans [2009] NSWWCCPD 95 per Snell ADP at [59], citing the observations of O’Grady DP in Peric v Chul Lee Hyuang Ho Shing Jong Lee & Mi Ran t/as Pure and Delicious Healthy & Anor [2009] NSWWCCPD 47).

3. The Arbitrator’s findings that Mr Rafoo was not totally incapacitated for the relevant period were correct because the evidence before the Arbitrator did not support a different conclusion.

Shane Shoesmith v Cessnock Truck and Tyre Centre Pty Limited [2010] NSWWCCPD 39

Separate injuries; circumstances where worker entitled to two concurrent awards of weekly compensation; evidence of incapacity.

O’Grady DP

14 April 2010

Facts:

Mr Shoesmith, a tyre fitter, suffered an injury to his left knee as a result of being struck by a falling truck tyre on 31 January 2005 in the course of his employment. He ceased work following the injury and remained out of work since then by reason of alleged incapacity. Prior to this incident, he also suffered numerous injuries to the left knee from various work- and sports-related incidents.  In 2003, he recovered damages from an earlier employer for a work injury to his left knee sustained in 1999.

In 2007, Mr Shoesmith was awarded damages for injuries to his left knee and back in a work-related motor vehicle accident on 8 December 2004. Balla DCJ awarded damages for economic loss for a closed period for incapacity arising out of this motor vehicle injury. The Court of Appeal affirmed Balla DCJ’s decision.

Mr Shoesmith lodged an ARD on 1 October 2009, seeking weekly compensation as a result of the January 2005 injury. The Respondent disputed liability, arguing that Mr Shoesmith did not have an ongoing incapacity resulting from that injury.

An issue before the Arbitrator concerned the question as to whether the payments had been paid in respect of incapacity resulting from the 2005 injury because weekly benefits had been paid by the insurer up until 30 September 2007 after the claims lodged by Mr Shoesmith in respect of both the December 2004 and January 2005 injuries.

The Arbitrator found that Mr Shoesmith was incapacitated for work from 31 January 2005 to 16 September 2005, but did not specifically find whether the incapacity was total or partial during that period. Given that weekly benefits had been paid in respect of that period, an award for the Respondent employer was entered.

Mr Shoesmith appealed, arguing that the period of incapacity should be from 31 January 2005 to 16 December 2005, and that the Arbitrator erred in not awarding weekly payments because there was no evidence to support the finding that the insurer mischaracterised the weekly compensation payments and that the insurer made no application to recover such payments.

Held: Arbitrator’s decision partly revoked – new decision substituted to award the worker weekly compensation for a closed period from 31 January 2005 to 13 April 2005 in respect of total incapacity, and to award the employer credit in respect of weekly payments made.

1. Having regard to the medical evidence, including that relating to Mr Shoesmith’s presentation at the hospital and the contemporaneous notes of medical practitioners, it was reasonable to infer that the impact of the tyre upon his knee joint aggravated a significant underlying condition in the left knee. There was no evidence of “new pathology”, as argued by the Respondent, and the aggravation was found to be temporary.

2. The evidence was not persuasive as to any relationship between the subject injury and any ongoing partial incapacity that may be inferred from the various medical certificates. It was open on the evidence to conclude that the consequences of the injury and the need for treatment had ceased by 13 April 2005 (at [90]). The Arbitrator’s finding in respect of the period of incapacity was therefore revoked, and a new finding was substituted to reflect that Mr Shoesmith suffered total incapacity from 31 January 2005 to 13 April 2005, due to an aggravation of a pre-existing disability in his left knee. The evidence did not establish incapacity thereafter that was causally related to the work injury.

3. O’Grady DP distinguished the facts of the case from Cordina Chicken Farms Pty Ltd v Thoa Hong Le [2008] NSWWCCPD 125 (‘Cordina’), which is authority for the proposition that a worker is entitled to two awards where two separate injuries result in two separate concurrent incapacities. Cordina could not apply to the present facts because Mr Shoesmith was bound by the findings of Balla DCJ that the consequences of his incapacity with respect to the injury in December 2004 had ceased before Christmas 2004. There were no separate and concurrent incapacities resulting from the 2004 motor vehicle accident and from the 2005 injury.

4. The weekly payments already made had discharged the Respondent’s obligation. Nevertheless, Mr Shoesmith was entitled to the entry of an award in his favour (Ashenden v Stewarts & Lloyds (Aus) Ltd [1972] 2 NSWLR 484). The Arbitrator’s finding was therefore revoked and a new decision was substituted to award Mr Shoesmith weekly benefits for the relevant period.

5. The Respondent had met its obligations and was entitled to credit for payments made in respect of the relevant period.

6. The Arbitrator’s order as to costs was affirmed for reasons stated at [100].