Issue 1: January 2017

McLennan v Roads and Maritime Services [2016] NSWWCCPD 59

(a) failing to correctly apply the provisions of s 52 of the 1987 Act with regard to injuries occurring before and after 1 July 1985 in accordance with the decision of the NSW Supreme Court, Court of Appeal in Royal North Shore Hospital v Rizk (unreported, NSW Court of Appeal, 23 August 1995) (Rizk);

(b) concluding that the decision in Rizk did not operate to compel a result that TMF was obliged to reinstate payments of compensation to the worker;

(c) determining that the application of s 22 of the 1987 Act by the Commission as constituted by Arbitrator Theobald in 2006 had the effect of excluding the operation of the decision in Rizk, and

(d) impliedly accepting that the worker suffered a single incapacity resulting from more than one injury and that one of those injuries occurred prior to 30 June 1985, the Arbitrator further erred in concluding that s 52 of the 1987 Act had application.

Discussion and findings

1. The President held that, save for the apportionment issues, the decision in Rizk was on all fours with the facts in this case. The Court in Rizk found that where a worker establishes that he or she has suffered an incapacity as a result of an injury received before 30 June 1985 then s 52(2)(a), which effectively terminates the weekly payments once the worker reaches retirement age, has no application. The Court added that where the incapacity results solely from injuries received after 30 June 1985 then, of course, once the worker has reached the relevant age the weekly payments cease. The President found that decision to be binding authority on the Commission ([56], [61], [63]).

2. The President then considered the effect of the apportionment that clearly delineated injuries that occurred both before and after 30 June 1985. His Honour held that the answer to that question lied in part upon an appreciation of the distinction between liability for compensation pursuant to the combined provisions of ss 4, 9 and 33 of the 1987 Act and the provisions concerning the question of apportionment of liability in s 22 and s 22A ([64]–[65]).

3. There is a two stage process when apportionment is sought; firstly the initial determination of liability and subsequently an apportionment of liability (Sutherland Shire Council v Baltica General Insurance Co Ltd & Ors (1996) 12 NSWCCR 716 and Trustees of the Roman Catholic Church for the Diocese of Parramatta v Barnes [2015] NSWWCCPD 35 applied) ([66]).

4. The risk insured against, under the polices of insurance in the present case, was a liability of the employer to pay compensation to the worker in respect of injuries sustained “arising out of or in the course of employment” (s 4). Pursuant to s 9 a worker who has received an injury shall receive compensation from the worker’s employer in accordance with the Act. If incapacity results from an injury, the compensation payable by the employer to the worker shall include a weekly payment during the incapacity (s 33 of the 1987 Act). The worker established that these provisions were satisfied by reason of the findings of Arbitrator Theobald. Thus the liability to pay weekly compensation was established and the employer ordered to pay compensation ([67]).

5. The policies of insurance entered into by the employer with the two insurers merely created an indemnity in favour of the employer against any liability arising under the legislation. They did not and could not affect the primary liability of the employer to pay compensation once the worker satisfied ss 4, 9 and 33 ([68]).

6. Based on the binding authority in Rizk, the worker was entitled to continue to receive weekly compensation after reaching retirement age, from the employer, because his incapacity was due to injuries sustained before and after 30 June 1985. The employer’s indemnity arrangements with its insurers were immaterial to that primary liability. For that reason s 52 did not operate to bring the entitlement to compensation under the award to an end upon the worker reaching retirement age ([69]).

7. The President further observed that it was not open to TMF to determine, of its own volition, that it was free to decline further indemnity merely because it had formed the view it was open to do so. The appropriate course was to seek an order from the Commission varying the terms upon which the apportionment of the liability of the employer was to be carried forward under s 55 of the 1987 Act ([71], [75]).

8. It followed that the Arbitrator was wrong to conclude that because TMF’s liability was in respect of injuries sustained after 30 June 1985 it could terminate payments upon the worker reaching retirement age ([76]).

(a) clinical notes from the treating psychologist demonstrated that the deceased’s mental state was adversely affected by the consequences of the injury (Ground No (i));

(b) deceased increased her consumption of amitriptyline (Ground No (ii));

(c) deceased increased her consumption of amitriptyline to help her cope  (Ground No (iii)), and

(d) increase in the use of amitriptyline was a result of the work injury (Ground No (iv)).

Ground No (i)

1. Acting President Snell noted that the Arbitrator approached the issue on the basis that there was no direct evidence to make the causal link between the accepted employment injury and consumption of the fatal dose of amitriptyline. Therefore, an inference was drawn based on the available evidence. The Acting President referred to the line of authority in Mason v Demasi [2009] NSWCA 227 and Winter v New South Wales Police Force [2010] NSWWCCPD 121 that dealt with the weight to be attached to various clinical notes. He said that, in considering whether there was evidence that supported the factual findings made by the Arbitrator, it was necessary to refer to the evidence as a whole (Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430 applied) ([57]–[61]).

2. The Acting President then referred to some authorities in respect of drawing inferences, in determining the issue of causation:

(a) A finding of causal connection may be open without any medical evidence at all to support it, or when the expert evidence does not rise above the opinion that a causal connection is possible, provided that the materials offered justify an inference of probable connection (Fernandez v Tubemakers of Australia Ltd [1975] 2 NSWLR 190 Glass JA at 197C) (Fernandez).

(b) Where direct proof is not available it is enough if the circumstances appearing in the evidence give rise to a reasonable and definite inference; such an inference is not to be regarded as a mere conjecture or surmise (Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5; Luxton v Vines [1952] HCA 19; 85 CLR 352 per Dixon, Fullagar and Kitto JJ at [8] ([86]–[87]).

(c) Proof on the balance of probabilities may be established on the basis of circumstantial evidence (Seltsam Pty Ltd v McGuiness [2000] NSWCA 29; 49 NSWLR 262 at [90]–[91] Spigelman CJ) [88]).

(d) Causation can be established by a process of inference which combines primary facts like “strands in a cable” rather than “links in a chain” (Wigmore on Evidence (3rd ed) para 2497, referred to in Shepherd v R [1990] HCA 56; 170 CLR 573 at 579) ([88]).

(e) An inference of fact needs to involve “a definite conclusion of which the trier of fact is affirmatively satisfied, as distinct from merely a possible explanation for the known facts” (Fuller-Lyons v New South Wales [2015] HCA 31 at [46]) ([89]).

3. Acting President Snell agreed with the Arbitrator that the deceased was already in a vulnerable mental state prior to the employment injury. The deceased suffered pain from pelvic heaviness and lower back discomfort as a result of the prolapse. She suffered emotional distress at the injury. There were regular references to the deceased’s prolapse, its effects on her work and the associated surgery in the psychologist’s clinical notes. The clinical note on 13 August 2015 (the day prior to her death) described a busy time at work, following which she was in a lot of pain, which lead her to cease duties with the appellant. The reference to pain in the statement of one of the witnesses clearly referred, at least in part, to the uterine prolapse. The deceased remained in a lot of pain even when she felt happier at work. There was medical evidence attributing the lower back pain to the prolapse ([90]).

4. Acting President Snell concluded that the evidence, both lay and medical, gave rise to a reasonable and definite inference that the deceased’s mental state was adversely affected by the consequences of the subject injury. The inference was available and consistent with the authorities in this regard ([91]).

5. Ground No (i) failed ([92]).

Grounds No (ii), (iii) and (iv) 

6. The appellant submitted that there was no evidence that the deceased took increasing doses of amitriptyline (Endep) to help her cope ([95]–[98]).

7. The respondent submitted that the deceased ingested a fatal dosage of amitriptyline, and must have increased her dosage on that day at least. Acting President Snell rejected that submission. The deceased’s death did not solely result from the ingestion of amitriptyline; it resulted from amitriptyline in association with alcohol. Amitriptyline is additive in its effects, when combined with alcohol. She could, for example, have ingested similar quantities of amitriptyline before, but not in concert with alcohol ([99], [110]–[111]).

8. The Arbitrator attributed the deceased’s death to the significant level of amitriptyline she had ingested, coupled with alcohol. Acting President Snell agreed, finding that such a finding was available on the expert evidence of the pathologist. Given the potential combined effect of amitriptyline and alcohol, Acting President Snell said that it could not be inferred that the deceased ingested a larger dose of amitriptyline at the time of her death than she had previously. The issue was not whether the deceased took the largest dose of amitriptyline she had ever taken, but rather whether the deceased consumed the overdose as a result of the employment injury ([114]–[118]).

9. The Acting President said that, in order to succeed in the claim, the respondent had to establish that the employment injury materially contributed to the fatal ingestion of amitriptyline. The lay evidence established that the deceased was in significant physical and emotional distress. She was depressed. It established that the deceased was using a large amount of alcohol, painkillers and antidepressants, because she was in a lot of pain. The antidepressant used was probably amitriptyline. The respondent submitted that the available and compelling inference was that pain and depression, occasioned by the employment injury, materially contributed to the overdose taken on 13 August 2015. The Acting President accepted that submission ([124]).

10. Acting President Snell said that the appellant, in submitting that the deceased had a long history of depression and increased dosage prescriptions for Endep (amitriptyline), argued effectively that the overdose occurred coincidentally, rather than as a result of the employment injury. He noted that the deceased’s long history of depression with increased dosages of Endep was acknowledged by the Arbitrator. The overdose occurred following the deceased’s uterine prolapse, while she was in significant pain, suffering emotional distress, and awaiting surgery (about which she was apprehensive) involving repair of the prolapse and possible hysterectomy ([125]–[126]).

11. Acting President Snell said that the employment injury resulted in significant pain and a worsening of the deceased’s mental state, with which the consumption of alcohol, painkillers and antidepressants (which contained amitriptyline, on the probabilities) were associated. On the balance of probabilities, the materials “justified an inference of probable connection” as required in Fernandez. The employment injury, its physical and mental consequences, materially contributed to the death of the deceased. Applying the principles in Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452; 10 NSWCCR 796 and Sutherland Shire Council v Baltica (1996) 39 NSWLR 87, the Acting President concluded that the deceased’s death resulted from the employment injury ([127]).

12. Grounds No (ii), (iii) and (iv) failed ([128]).

(a) in fact by concluding that the worker suffered from a primary psychological injury, against the weight of the evidence;

(b) in fact by concluding that the worker’s evidence was not challenged;

(c) in fact by finding that the appellant’s counsel abandoned the challenge to the reliability of the worker’s evidence;

(d) in law by finding that the Arbitrator was bound to accept the evidence of the worker, notwithstanding contradictory evidence where the worker’s credit had not been directly challenged during the hearing of the matter, and

(e) in law by misleading himself as to the adversarial nature of the jurisdiction.

Held: the Arbitrator’s determination was confirmed.     

Ground (a)

1. The President accepted that the s 74 notice raised a challenge to the worker’s credit. However, at the arbitration hearing before the Arbitrator the appellant’s counsel made no direct challenge to the reliability of the worker’s evidence ([124]–[126]).

2. The Arbitrator considered that it was inappropriate to determine the matter against the worker on the basis of reliability or credibility, if the appellant did not raise it in submissions because the worker would not have an opportunity to deal with it. The Arbitrator applied Browne v Dunn (1894) 6 R 67 and West v Mead [2003] NSWSC 161 ([128]–[131]).

3. The appellant’s counsel eschewed reliance on the worker’s reliability, stating that the gap in the reporting of his symptoms was not a matter that went to his reliability but to the issue of causation. The appellant’s counsel did not refer to evidence of alleged underperformance with respect to the neuro-psychological assessments nor the record of malingering in the s 74 notice ([132]).

4. The President rejected the submission that an inferred attack on the worker’s credit was sufficient for the issue to remain a live issue in the proceedings. He also rejected the submission that at no stage did counsel for the appellant state that reliability and credibility were not in issue. It followed that he rejected the submission that there was a live challenge to the worker’s reliability given the way the case was run before the Arbitrator ([133]–[135]).

Ground (b)

5. There was no compelling submission or reasoned argument directed to the alleged error concerning whether the Arbitrator was correct to conclude that any challenge to the worker’s reliability as a witness was abandoned ([143]).

6. The matters upon which the appellant relied were adequately dealt with by the Arbitrator once it was accepted that there was no challenge to the worker’s reliability ([144]).

7. The President observed that cases are decided on the evidence tendered and arguments presented, not on pleadings (Banque Commerciale SA (in liq) v Akhil Holdings Ltd [1990] HCA 11; 169 CLR 279). This is especially so in the Commission, which has a statutory obligation to act according to the substantial merits of the case (s 354(3) of the 1998 Act applied in Baker v Southern Metropolitan Cemeteries Trust [2015] NSWWCCPD 56) ([147]).

8. Therefore it was necessary that the Arbitrator determine the case on the issues presented. Although the Arbitrator expressed grave misgivings about accepting the worker’s evidence, as did the President, as the worker’s credit was not challenged in the proceedings before him the Arbitrator correctly found that he was bound to accept it ([148]).

Ground (c)

9. The President observed that the Arbitrator articulated his reasons for deciding the causation question in the worker’s favour. His reasons included, amongst other things: the worker established a reasonable factual matrix for the acceptance of the evidence of medical experts who diagnosed a post-traumatic stress disorder; the appellant’s medical expert’s history was inaccurate and “out of kilter with the evidence”. It was on the basis of those factual findings that the Arbitrator concluded that the worker suffered a primary psychological injury at the time of the accident ([160]–[161]).

10. Once it was accepted that the worker gave reliable evidence that formed a satisfactory basis for the acceptance of the medical evidence the Arbitrator relied upon in making his findings in favour of the worker. The Arbitrator adequately explained his preference for the conclusions reached. Accordingly, no error was demonstrated ([163]).

Ground (d)

11. The submission that the Arbitrator was not bound by the submissions of counsel was plainly wrong. Appellants are bound by the forensic decisions made by their counsel during the conduct of a hearing (Smits v Roach [2006] HCA 36; 227 CLR 423 and Delaney v Winn [2015] NSWCA 124 considered and applied) ([169]).

12. The appellant was unsuccessful in the proceedings because, notwithstanding the Arbitrator’s misgivings, an adverse credit finding could not be made in circumstances where no submission to that effect had been put during the course of the arbitration. On that basis the Arbitrator correctly concluded that the worker’s evidence should be accepted. That in turn provided a sufficient factual basis for the acceptance of the expert evidence which the Arbitrator concluded, as a question of fact, was sufficient to find in the worker’s favour ([171]).

Ground (e)

13. The Arbitrator was correct to state that it is up to the parties to raise issues before and during the arbitration which if not raised or put to one side may reasonably lead the Arbitrator to conclude that the particular issue is not pressed ([182]).

14. The President rejected the submission that the Arbitrator misunderstood the extent of his obligation to assess the reliability of the evidence and the conclusions he drew in the context of the pleadings and the evidence presented by counsel. The Arbitrator meticulously identified and weighed the evidence both favourable and unfavourable to the worker. No error in his approach to the task was established ([186]).

(a) there was no aggravation of the respondent’s shoulder disease, therefore, no “injury” for the purpose of s 4(b)(ii);

(b) should there be any aggravation, the respondent’s employment with the appellant was not a substantial contributing factor to the aggravation etc within the meaning of s 16(1)(b) of the 1987 Act;

(c) the simple passage of time was a material causal factor which essentially ousted the effect, if any, of the respondent’s employment;

(d) the disease process was already so well established that it could hardly have been the subject of “substantial aggravation” by the employment with the appellant;

(e) causation for s 60 was not made out by the respondent, and

(f) symptomatic worsening of the respondent’s condition over the course of his employment did not amount to an aggravation etc of the disease. The appellant relied on Albury City Council v Gunton [2011] NSWWCCPD 68 (Gunton) in this regard.

In response to the appellant’s submission in respect of s 60, the respondent argued that the word “injury” in s 60 bore the same meaning as in s 4(b)(ii). In a disease injury case like the current case, satisfaction of s 4(b)(ii) meant proof of “injury” for the purpose of s 60. Then satisfaction of s 16(1)(b) identified the employer obliged to pay the medical treatment expenses. Alternatively, the respondent sought to rely on Murphy v Allity Management Services Pty Limited [2015] NSWWCCPD 49 (Murphy) and to the common sense test of causation.

Held: the Arbitrator’s determination was confirmed.

Consideration 

1. The Acting Deputy President was of the view that the Arbitrator correctly directed himself to the elements of ss 4(b)(i) and 16(1)(b) of the 1987 Act. The Arbitrator’s reliance on the cases of Cant v Catholic Schools Office (2000) 20 NSWCCR 88 and Murray v Shillingsworth [2006] NSWCA 367; 68 NSWLR 451 was appropriate ([31]).

2. The Arbitrator clearly recognised that the first step in his decision-making process was to make a factual decision as to whether s 4(b)(ii) was satisfied. It was not disputed that the respondent’s working life as a painter and decorator was the main aggravating factor in respect of his shoulder disease. The difficult question arose under s 16(1)(b), in respect of which the Arbitrator found in favour of the respondent worker by the barest measure ([33]–[34]).

3. In determining whether the appellant was the last employer that was a substantial contributing factor to the aggravation etc. of the respondent’s shoulder disease, the Acting Deputy President observed that the correct approach was set out in the decision of Roche DP in Raulston v Toll [2011] NSWWCCPD 25 ([35]).

4. Where a finding of fact is under scrutiny, the Acting Deputy President observed that the issue was whether the Arbitrator’s finding was open upon the evidence. The finding should only be interfered with if the proper conclusion is that it is clearly wrong ([36]).

5. Acting Deputy President King held that the Arbitrator’s finding in the current case was open on the evidence. Once it was accepted that there was a proper evidentiary foundation for a conclusion of substantial contribution to the diseased condition by the employment with the appellant, that fact could not be regarded as compelling a contrary conclusion. The question was factual in nature. The case of Gunton offered no real support for the appellant ([37]–[38]).

6. The Acting Deputy President then considered the respondent’s submission with respect to the operation of s 60. The Acting Deputy President distinguished Murphy on the basis that it involved a frank injury rather than “disease injury”, but said that the respondent’s argument was correct. The Deputy President found that the finding in the respondent’s favour of “injury” satisfied s 60 and the finding in the respondent’s favour under s 16(1)(b) identified the appellant as the employer liable to pay ([39]-[40]).