State of New South Wales v Wright

1. [1]

   BASTEN AJ: Paul Wright (“the worker”), [1] who worked for the Western Sydney Local Health District as a courier driver from August 2012 until about April 2019, has made a claim against the State of New South Wales (“the employer”). [2] He claimed that he had been the subject of bullying, harassment and other forms of mistreatment by his supervisor, resulting in a psychological condition which left him unable to work. On 7 September 2020, he filed an application in the Workers Compensation Commission claiming weekly benefits and medical expenses. On 6 November 2020, he obtained a determination for weekly payments for the period from 6 December 2018 to 7 November 2019, based on a deemed date of injury of 5 December 2018.

2. [2]

   On 8 April 2022, the worker filed a further application in what had become the Personal Injury Commission [3] seeking to resolve a dispute as to the payment of lump sum compensation, where the degree of his permanent impairment was in dispute. A criterion for payment of a lump sum benefit was an assessment of whole person impairment of not less than 15%. [4] That matter was referred to a medical assessor who determined whole person impairment of 19%, entitling the worker to an amount of lump sum compensation in the order of $50,000.

3. [3]

   The employer appealed from that decision to an Appeal Panel on the basis that the assessment contained a “demonstrable error”. On 7 November 2022, the appeal was dismissed. The present proceeding seeks judicial review of the decision of the Appeal Panel.

Basis of judicial review

1. [4]

   Pursuant to a further amended summons filed in Court on the hearing of the application, the employer relied upon 12 grounds, some of which alleged error “in fact”, others of which alleged errors “at law” and others a denial of procedural fairness, constituting jurisdictional error. It was not in dispute that the supervisory jurisdiction of the Court, invoked pursuant to s 69 of the Supreme Court Act 1970 (NSW), required that the employer establish either jurisdictional error or error of law “on the face of the record”. Succinctly stated, the error on the part of the medical assessor, not accepted as such by the Appeal Panel, was a failure to confine the inquiry in relation to whole person impairment to the terms of the matter in dispute between the parties. If made good, the error might be identified either as an error of law on the face of the record, the record being the reasons of the Appeal Panel, or a jurisdictional error, in so far as the assessor exceeded his powers under the referral of the medical dispute, properly identified.

2. [5]

   The nature of the issue requires further identification by reference to the procedural history in the Commission. It is common ground that, if the employer’s complaint is made good, the appropriate course is to set aside the decision of the Appeal Panel and remit the matter to the President of the Personal Injury Commission.

Scope of medical dispute

1. [6]

   As explained by Leeming JA in Skates v Hills Industries Ltd, [5] the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (“Workplace Injury Act”), makes provision for referral of a “medical dispute” for assessment in Pt 7 of the Workplace Injury Act. The referral in the present case was made under s 293 of the Workplace Injury Act. What is to be referred, is a “medical dispute”, a term defined in s 319 to mean “a dispute between a claimant and the person on whom a claim is made about any of the following matters … (c) the degree of permanent impairment of the worker as a result of an injury”.

2. [7]

   As Leeming JA further explained in Skates, the purpose of the referral is to resolve the medical dispute. [6] All the relevant provisions “proceed on the basis that the outcome of the assessment is the resolution of the medical dispute”. [7] To determine whether the medical assessor exceeded his jurisdiction, it is therefore necessary to identify the scope of the medical dispute which was referred to him.

3. [8]

   On 8 April 2022, the worker’s solicitors filed an application to resolve a dispute (ARD) with the Personal Injury Commission. Under the heading “matters in dispute”, the particular item ticked was “Lump sum compensation where degree of permanent injury is in dispute”. The application revealed that there had been a previous proceeding in the Commission, being matter 5068/20. Under the heading “Injury Details”, the type of injury was identified as “Disease” and the “deemed” date of injury as 20 May 2021. The place was identified as “within the environs of the respondent’s premises”. The injury was described in the following terms:

4. [9]

   The whole person impairment percentage was identified as “19” and the amount of the payment sought was $50,260.

5. [10]

   On 29 April 2022, the employer’s solicitors filed a reply which annexed numerous documents not before this Court. Under the heading “matters in dispute” (as set out in annexure A to the reply) the following statement appeared: [8]

6. [11]

   The proposed amendment was agreed to, so that the allegation of injury referred to the medical assessor was in the terms set out in par 3 of the reply.

7. [12]

   It was not in dispute that the psychological conditions alleged constituted a “disease” for the purposes of s 4 (b) of the Workers Compensation Act, and that the disease was either one of such a nature as to be contracted by a gradual process (for the purposes of s 15 of that Act) or consisted of the aggravation, acceleration, exacerbation or deterioration of a disease (for the purposes of s 16 of that Act). These sections provided that the date on which such an injury was deemed to have occurred was, relevantly, either the date of incapacity or the time at which a claim for compensation was made.

8. [13]

   There is no doubt that the medical assessor (Dr Michael Hong) correctly understood the period during which the injury was said to have occurred: he identified it in a number of places in his written determination. It was also not in doubt that the medical assessor was entitled to have regard to evidence as to matters relevant to the worker’s condition between the date of injury and the date of the assessment. The assessment will only be undertaken when the worker’s condition has stabilised: [9]

9. [14]

   The medical assessor’s reasons are required to provide certification that the impairment is permanent and to identify the degree of impairment. Section 8 of the assessor’s reasons followed a template, addressing specific issues. Paragraph g asked, “whether there has been any further injury subsequent to the subject work injury”. The note to the question stated:

10. [15]

    The medical assessor answered this question with the statement, “no further injury”. In this Court, the principal issue was what was to be inferred from the statement “no further injury”. The employer’s contention was founded upon par 2 of its reply, namely that the Commission had made an award (by consent) in relation to allegations of injury relating to interactions between the worker and his supervisor and colleagues in the workplace after 5 December 2018. It was necessary, therefore, to identify the scope of this award which, it was submitted, confined the nature of the dispute before the medical assessor.

11. [16]

    The earlier claim, 5068/20, lodged by the worker’s solicitor on 7 September 2020, sought weekly benefits and medical expenses, with the date of injury being identified as a deemed date of 9 August 2018. The description of the injury given in the claim form was as follows:

12. [17]

    This description was imprecise as to the scope and timing of the injury. The conduct identified in the first sentence was said to (on the one hand) cause or precipitate the psychological injury and (on the other hand) to aggravate or exacerbate what must have been an existing condition. His evidence did not support a pre-existing condition; rather the second sentence suggested that the work injury commenced as an adjustment disorder and later became a major depression. The hospital admissions both occurred in 2020.

13. [18]

    The type of injury described as “aggravation, acceleration or exacerbation or deterioration of disease” derives from the element of the definition of “injury” in s 4(b)(ii) of the Workers Compensation Act. It may be noted that the terms “aggravation” and “exacerbation” imply some further work-related event or conduct having that effect, whilst “acceleration” and “deterioration” imply an ongoing process without necessarily any additional causative event or conduct.

14. [19]

    A worker’s condition may deteriorate over time, following an injury, without giving rise to a further injury. The injury identified in s 4(b)(ii) of the Workers Compensation Act imposes a limitation, namely “… but only if the employment was the main contributing factor to the aggravation, acceleration, exacerbation or deterioration of the disease”.

15. [20]

    Returning to the weekly benefit claim, a Certificate of Determination was issued on 6 November 2020 which commenced with an order in the following terms:

16. [21]

    Order 2 was an award in favour of the worker of weekly compensation for the period 6 December 2018 to 7 November 2019. Order 3 was an award in favour of the employer “in respect of any allegation of incapacity beyond 7 November 2019”. Order 5, read as follows:

Issues on review

1. [22]

   The employer’s contention, based on the effect of orders 1 and 5, was not that the medical assessor could not take account of any change in the worker’s condition after 5 December 2018: rather, it was that the assessor could not take into account any aggravation or exacerbation of his condition caused by further interactions with his supervisor and work colleagues in the period during which he returned to work in late February and early March 2019. The employer submitted that the medical assessor had taken into account the matters identified as the “additional injury” despite the exclusion of those considerations from the scope of the dispute pursuant to the consent determination of 6 November 2020. Further, the employer submitted, the scope of the medical dispute was a question of law and, if the medical assessor (and the Appeal Panel) failed properly to identify the scope of the medical dispute, that was a matter which could be corrected by this Court.

2. [23]

   Senior counsel for the worker contended that the employer’s case turned in large part on Dr Smith’s reports, and in particular the opinion expressed in his report of 16 June 2020: [10]

3. [24]

   The worker submitted that this opinion was, as a matter of fact, not accepted by the medical assessor, a conclusion which was open to him and not subject to appeal or review. The medical assessor formed the opinion that a psychological condition had arisen prior to 5 December 2018, resulting from work-related conduct of the employer. That finding did not constitute the demonstrable error relied upon before the Appeal Panel. Accordingly, the primary basis of the employer’s case was misconceived.

4. [25]

   Otherwise, the worker’s response was reduceable to the following propositions:

5. [26]

   Before addressing these submissions, it is convenient to identify the relevant steps in the reasoning of the medical assessor and, on appeal, in the reasoning of the Appeal Panel.

Reasoning of medical assessor

1. [27]

   As noted above, the medical assessor correctly identified the deemed date of injury and the period to which it related. He further identified the State as the applicant’s employer and his occupation as a courier driver. The first substantial section in the reasons was section 4, entitled “History relating to the injury”. Although the worker submitted that this section merely set out background information supplied by him to the assessor, it, together with a brief passage dealing with findings on physical examination, constituted three pages of an eight-page report. The other major section was section 10, entitled “Reasons for assessment”. As will be noted, the assessor, understandably, placed significant weight on the history provided by the worker.

2. [28]

   The first section of the history commenced with the following passages:

3. [29]

   Some of the history, with additional detail, was repeated in a subsequent passage in section 4 headed “Background history”. It reads as follows:

4. [30]

   In his “summary of injuries and diagnoses” (section 7) the assessor stated:

5. [31]

   As noted above, the assessor concluded in section 8 that there was no “further injury subsequent to the subject work injury”.

6. [32]

   The reasons for assessment (section 10) commenced with a very brief paragraph referring to the worker’s “numerous statements” and his “major issue relating to his manager”. The passage noted the worker’s further statement which “discussed the return-to-work problems”. The assessor then addressed, with comments, the reports of Dr Michael Robertson, psychiatrist, reports from the St John of God Hospital, and from Dr Clayton Smith, psychiatrist.

7. [33]

   With respect to the first report of Dr Michael Robertson of 28 May 2019, the assessor stated that he:

8. [34]

   The assessor also referred to a report by Ms Raj, psychologist, of 19 March 2019, who noted “adjustment disorder due to harassment by manager and the report consistently identified depression and anxiety, as well as noting the return-to-work problems”.

9. [35]

   With respect to the first report of Dr Clayton Smith of 18 January 2019, the assessor observed that there was “no psychiatric diagnosis, he could return to work”. On 18 March 2020, Dr Smith reported “deterioration in 2019 because he was stuck at home obsessing over what happened at work, and he advised it appeared he developed an adjustment disorder”. The assessor also referred to Dr Smith’s report of 16 June 2020, which advised that “Mr Wright suffered an aggravation of an adjustment disorder during 2019, especially December 2019 due to decision to relocate position in Liverpool, which required him to reapply for his position and he felt ambushed”. (The relevant date should have been earlier in 2019.)

10. [36]

    It is self-evident that lengthy consideration was given to events which occurred in the workplace after 5 December 2018 involving the worker’s manager and work colleagues. On the face of the reasons there is no suggestion that Dr Hong appreciated, or had regard to, any limitation on the use that could be made of the “return-to-work problem” which eventuated after 5 December 2018.

Reasoning of Appeal Panel

1. [37]

   The submissions made by the employer in this Court were also raised in written submissions in support of its appeal to the Appeal Panel. There is no occasion to summarise those submissions, as they will be addressed to the extent necessary in explaining the reasoning of the Appeal Panel.

2. [38]

   The dispositive passage in the Appeal Panel’s reasons (pars 35-43) commenced with the proposition that “by virtue of Orders 1 and 5 made in the earlier proceedings in the Workers Compensation Commission, neither party can contend that the [worker] suffered what is therein described as ‘the additional injury’”. [11] The Panel accepted that a consent order can create a res judicata estoppel or an issue estoppel. [12] The Panel then turned to consider what the parties meant by the term “additional injury”. The reasons continued:

3. [39]

   Two points may be made in relation to this reasoning. First, order 1 involved an amendment to the worker’s claim. It expanded the worker’s claim to cover post-injury conduct of the employer. That order 5 referred to an “alleged” additional injury, implied that the claim was rejected whether or not the matters alleged could be substantiated. As the Appeal Panel noted, there could have been an injury resulting from the employer’s conduct which was non-compensable, because it was wholly or predominantly caused by reasonable action taken with respect to the transfer, performance appraisal or other steps identified in s 11A(1) of the Workers Compensation Act. There is nothing unusual in a court or tribunal ruling that a claim must be dismissed on an assumption that the facts alleged are established, because the defendant has a complete defence on other grounds. Reliance on the phrase “alleged additional injury” in order 5, a reliance repeated by the worker in this Court, is not significant.

4. [40]

   Secondly, the attempt to identify what was meant by the phrase “additional injury” is confused. The phrase was simply a shorthand term to identify a claim by the worker that “in the course of employment subsequent to 5 December 2018, as a result of the worker’s interactions with his supervisors, fellow employees and officers of the [employer] … he suffered further aggravation and exacerbation of a psychological condition”. The effect of order 5 was to reject that claim. It followed that a complaint that the conduct of the employer had resulted in further aggravation and exacerbation of a psychological condition arising before 5 December 2018, could not be pursued. It further followed that the medical assessor should have identified and excluded any such aggravation or exacerbation from his assessment of the injury caused by the conduct preceding 5 December 2018.

5. [41]

   The Appeal Panel did not reach those conclusions. Rather, the reasoning continued:

6. [42]

   Each of these sentences is correct as a matter of fact, but they do not address the employer’s contention. The employer submitted that the medical assessor’s rejection of the proposition that the worker had suffered any further injury (at par 8g) was in fact a conclusion supported by his earlier finding that the worker’s reaction to the death of his father did not cause psychiatric injury. The real issue was how the medical assessor had dealt with a history (which he clearly accepted) that included the worker’s response to the employer’s conduct when he sought to return to work in February/March 2019. The issue for the Appeal Panel was whether, despite the absence of any discussion by the assessor of that issue, it could be inferred that he had rejected the possibility that the applicant’s condition was aggravated or exacerbated by that conduct of the employer.

7. [43]

   What followed in the Appeal Panel’s reasoning (at par 41) commenced with the phrase “in arguendo”, and identified a possible understanding as to what the estoppel did not achieve, which was explained as “a hypothetical given what the Appeal Panel has said about the estoppel that did arise from the prior award”. The first sentence had convoluted syntax which need not be repeated. The first six lines sought to characterise a different basis for the estoppel in a series of dependent clauses, but appear to have been summarised in the following terms, “in other words the respondent can contend in these proceedings that there was a subsequent ‘additional injury’”. (The term “respondent” must be a mistake and intended to refer to the appellant/employer.) What followed from that, the reasons continued, was that the additional injury “did not arise from the same incidents as the incidents from which the injury on 5 December 2018 occurred”. That was said to have consequences in that “s 65(2) of the [Workers Compensation Act] and s 323(3) [sic, s 322(3)] of the [Workplace Injury Act] could not be engaged”. (Whether or not they were engaged was not an issue raised by either party in this Court.)

8. [44]

   The reasoning continued:

9. [45]

   It is not necessary for present purposes to analyse how common law principles of causation operate in the statutory context where the Act itself contains several provisions identifying relevant causal connections, including ss 4(b), 9A(1) and 11A(1). The point is rather that, on the employer’s case, the award in the earlier proceedings had rejected the claim that in the course of his employment subsequent to 5 December 2018 the worker suffered further aggravation or exacerbation of a psychological condition. It is that determination which should have prevented the worker from relying upon such conduct as causally connected with the earlier injury. This aspect of the reasoning of the Appeal Panel failed to address that contention as to the effect of the earlier determination.

10. [46]

    Lest there be doubt about that conclusion, the Appeal Panel continued:

11. [47]

    This paragraph stated another hypothetical situation, with the second sentence commencing, “if the estoppel …”. Taken literally, the reasoning is correct: it is simply irrelevant because no effect is given to the estoppel arising from the earlier determination.

12. [48]

    The final paragraph in the Appeal Panel reasoning was as follows:

13. [49]

    Again, the passage ignores the effect of the estoppel.

Conclusions

1. [50]

   There was no dispute in this Court (or before the Appeal Panel) that the earlier determination could give rise to an estoppel.

2. [51]

   The effect of orders 1 and 5 in the determination of 6 November 2020 was that the worker did not suffer any further aggravation and exacerbation of his psychological condition as a result of conduct of the employer after 5 December 2018. The history recorded by the medical assessor in his reasons for determination included repeated references to the worker’s claims of ongoing bullying and harassment in 2019. There was no suggestion that the medical assessor disregarded those claims, nor that he determined that they had no effect in aggravating or exacerbating the worker’s psychological condition. That conclusion does not, as the worker submitted in this Court, adopt the approach excoriated in Minister for Immigration and Ethnic Affairs v Wu Shan Liang, [13] to construe reasons for decision “minutely and finely with an eye keenly attuned to the perception of error”. Rather, it is to draw the only reasonable inference from the omission of the assessor to pay any regard to the terms of the earlier order and the definition of “additional injury”.

3. [52]

   It follows that the Appeal Panel was also in error in failing to identify an excess of jurisdiction on the part of the medical assessor in taking into account factors which he was required not to take into account.

4. [53]

   It is convenient to return to the worker’s submissions identified at [24]-[26] above. First, contrary to the worker’s primary submission, the employer’s case did not turn on the factual finding of Dr Smith that a psychological injury first arose in the period after 5 December 2018. Rather, it turned on the proposition that order 5 required the assessor to disregard any evidence of exacerbation or aggravation of the worker’s condition arising from work-related events after 5 December 2018. That was what was identified in order 1 as being the “additional injury” relied on by the worker. Contrary to Dr Smith’s opinion, the language of the additional injury assumed that there had been a psychological injury caused by the employer’s conduct prior to 5 December 2018.

5. [54]

   The worker’s reliance on the fact that order 5 referred to an “alleged additional injury” has been addressed in considering the reasoning of the Appeal Panel. The term “alleged” referred to the fact that the additional injury identified in order 1 was by way of addition to the details of injury identified in the worker’s application to the Commission.

6. [55]

   The remaining submissions of the worker relied on the proposition that the medical assessor did not make a finding that there had been any further injury in the period after 5 December 2018. That the assessor did not make such a finding in terms may be accepted. However, that submission did not come to grips with the employer’s complaint that the worker gave evidence, plainly accepted by the medical assessor, that his existing psychological condition was aggravated by further bullying and harassment in the workplace in February/March 2019. By relying on that aggravation, caused by work-related conduct, the assessor ignored the limitation on the terms of the dispute which he was required to resolve.

7. [56]

   It follows that the employer’s claim for judicial review should be upheld.

Orders

1. [57]

   In considering the appropriate orders, that which should be quashed is the order made by the Appeal Panel on 7 November 2020 as encapsulated in the certificate of determination issued by the Personal Injury Commission dated 2 December 2022.

2. [58]

   The employer also sought a declaration that the statement of reasons is void and of no effect and an order setting aside the statement of reasons. Although it is common-place to make orders setting aside “the judgment and orders” of a court, that is because the phrase “judgment and orders” may be viewed as a hendiadys: there is no appeal from reasons and the reasons alone have no operative effect. Accordingly, it is not appropriate to make orders in those terms.

3. [59]

   Both parties accepted that the consequence of success on the part of the employer was that the matter should be remitted to the President of the Personal Injury Commission for referral to an Appeal Panel differently constituted, under s 328 of the Workplace Injury Act.

4. [60]

   However, it follows from the error of law identified in the Panel’s reasons, that it was not open to the Panel to conclude that the medical assessor had given effect to the legal consequence of the earlier determination of the Commission. If that be correct, the referral back for reconsideration by an appeal panel is an unnecessary step because, if the appeal were determined according to law, it must result in the setting aside of the medical assessment certificate.

5. [61]

   Although there may have been doubt under the general law as to the power of the Court exercising the supervisory jurisdiction to grant the relief which an appeal panel should have granted, the Court now has statutory power to make such an order pursuant to s 69(3)(b) of the Supreme Court Act 1970 (NSW), which states that “if the Court determines that, as a matter of law, only one particular determination should have been made by the court or tribunal, [the Court has] jurisdiction to make such judgment or orders as are required for the purpose of finally determining the proceedings. As the employer did not seek such an order and as it is not strictly necessary, such an order should not be made; however, the same practical effect can be had by making a declaration as to the basis upon which the Court has set aside the determination of the Appeal Panel.

6. [62]

   As the employer did not seek costs in the event that it was successful; no order should be made as to the costs of the proceedings in this Court.

7. [63]

   Accordingly, the Court makes the following orders:

   1. (1)

      Set aside the decision of the Appeal Panel of the Personal Injury Commission dated 7 November 2022 and the Certificate of Determination issued by the Commission dated 2 December 2022.

   2. (2)

      Declare that the Appeal Panel erred in law in failing to find that in issuing the Medical Assessment Certificate dated 16 August 2022 the Commission exceeded its jurisdiction because the medical assessor did not give effect to the estoppel arising from the determination of the Workers Compensation Commission of 6 November 2020, Order 5.