Issue 5: May 2013

Goudappel v ADCO Constructions Pty Ltd [2013] NSWCA 94

1. The decision turned on whether the phrase in a transitional provision, “claim for compensation”, referred to a claim for compensation generally, or a claim specifically for lump sum compensation. The Court held that the former construction should be preferred. To the extent that the approach adopted by the President was reflected in a separate transitional regulation, the regulation was beyond power and could not support the conclusion reached in the Commission [7].

2. Generally, amending or repealing legislation will not affect the previous operation of the statute, nor any right, privilege, obligation or liability acquired, accrued or incurred under it: Interpretation Act 1987 (NSW), s 30(1). That general provision is subject to the operation of any specific saving or transitional provisions: s 30(2)(d). In relation to the 2012 Amending Act, there are three transitional provisions which compete for attention in respect of the amendment to s 66 [8].

Statutory transitional provisions

3. The provisions introduced by Sch 12 of the 2012 Amending Act are now found in Pt 19H of Sch 6 of the 1987 Act:

“3 Application of amendments generally

1. Except as provided by this Part or the regulations, an amendment made by the 2012 amending Act extends to:

(a) n injury received before the commencement of the amendment, and
(b) a claim for compensation made before the commencement of the amendment, and
(c) proceedings pending in the Commission or a court immediately before the commencement of the amendment.

2. An amendment made by the 2012 amending Act does not apply to compensation paid or payable in respect of any period before the commencement of the amendment, except as otherwise provided by this Part.

15 Lump sum compensation

An amendment made by Schedule 2 to the 2012 amending Act extends to a claim for compensation made on or after 19 June 2012, but not to such a claim made before that date. ”

4. With respect to cl 15, the applicant contended that his claim was not affected by the amendments because he had made a “claim for compensation” pursuant to ss 66 and 67 on 19 April 2012, three months before the critical date. “Claim” is defined, relevantly for present purposes, to mean “a claim for compensation”: 1998 Act, s 4(1). The term “compensation” is defined to mean “compensation under the Workers Compensation Acts [a phrase which includes both the 1987 Act and the 1998 Act], and includes any monetary benefit under those Acts”: ibid. Accordingly, the applicant submitted, the phrase “claim for compensation" covers a claim for any monetary benefit available under the 1987 Act. The phrase “lump sum compensation” is a defined term and means “compensation under Div 4 of Pt 3 of the [1987 Act]”, which included s 66 and s 67: 1998 Act, s 4(1). Had it been intended to require an extant claim for lump sum compensation as at the specified date, cl 15 could have so stated, but it did not [11].

5. The WorkCover Guidelines do not require that there be a separate claim for lump sum compensation. They provide for a “permanent impairment claim form”, but note that such a form is not required “if a claim is already in progress for the injury and the insurer has sufficient information”: Guidelines, Pt 5.1. A permanent impairment claim form is required “if a worker is initiating a claim for permanent impairment … and has not previously made a claim in respect of the injury or if the insurer does not have sufficient information about the injury for which the claim is being made” [13].

6. Section 261 of the 1998 Act sets out the prescribed periods within which a claim must be made [14]. There is a requirement that all claims for “permanent impairment compensation or pain and suffering compensation in respect of an injury must, as far as practicable, be made at the same time”: s 263(1). That provision applies for claims under ss 66 and 67 [15].

7. None of these provisions suggest that the Acts required, in June 2012, that an injured worker must make a separate claim for lump sum compensation: rather they are consistent with the contrary conclusion. It must follow that cl 15 did not require the application of the amended s 66 where the worker was able to rely upon a claim made prior to 19 June 2012 to establish an entitlement under s 66 [16].

Transitional regulation

(a) source of regulation-making power

8. There is a general power to make regulations, not inconsistent with the Act: s 280(1) of the 1987 Act. That power would not permit a regulation which was inconsistent with a provision in Sch 6 of the Act. Schedule 6, Pt 20 permits regulations of a savings or transitional nature. The operation of Pt 20 was not displaced, but was affected, by the 2012 Amending Act, which inserted Pt 19H [19]-[20].

(b) the transitional regulation

9. On 1 October 2012, the Workers Compensation Amendment (Transitional) Regulation 2012 came into operation.  Clause 11 purports to provide for the operation of the amending provisions, not by excepting all “claims for compensation” made before 19 June 2012 (as the Act had done), but by excepting only those claims that “specifically sought compensation under ss 66 or 67 of the 1987 Act” and were lodged before that date. As it expressly states, it varies the operation of cl 15 in Sch 6, Pt 19H to the Act. That statement was necessary either to conform to Pt 20, cl 1(4) or Pt 19H, cl 5(4), or possibly both [22].

10. The Regulation must conform to the power conferred in Pt 20, cl 1 of Sch 6 of the Act. That clause permits a regulation to “take effect” at a date prior to publication (cl 1(3)), though not a date earlier than the date of assent to the Act: cl 1(2). If a regulation is backdated so as to take effect prior to the date of its publication, it does not operate to affect prejudicially “the rights of [any] person existing before the date of its publication”: cl 1(3)(a). If the regulation is not expressed to “take effect” from an earlier date, cl 1(3)(a) does not operate; however, it would be absurd to read the Act as preventing a regulation interfering with accrued rights in respect of a period of backdating, which must be limited to the period after the Act commenced, but leaving open the possibility that the regulation could prejudice rights which had arisen before the Act commenced. The preferable reading is that Pt 20 cl 1 does not permit a regulation which interferes with rights which accrued prior to the date of its publication, whether or not it purported to take effect from an earlier date. General principles support the adopting of such an interpretation: Maxwell v Murphy [1957] HCA 7; 96 CLR 261 at 267 (Dixon CJ) [24].

11. In two respects, cl 5 in Pt 19H of Sch 6 expands the regulation-making power conferred by Pt 20 of the Schedule. First, cl 5(1) permits a regulation to take effect from a date earlier than the date of assent to the 2012 Amending Act, which would have been the earliest date permitted by Pt 20, cl 1(2). Secondly, cl 5(4) permits the regulation to “amend” provisions of the 1987 Act. This expands the terms of Pt 20, cl 1(4) which permits a regulation to have effect notwithstanding any other clause of Sch 6 only. The precise scope of cl 5(4) remains somewhat obscure. Its operation is restricted to regulations of a “saving or transitional nature consequent on the enactment of the 2012 amending Act” [26].

12. What is less clear is the intended operation of cl 5(2), providing that cl 1(3) of Pt 20 “does not limit the operation of this clause”. Clause 1(3) only operated to prevent a backdated regulation prejudicially affecting accrued rights existing before the date of its publication. If cl 5 was intended to permit further backdating, it could have been more clearly expressed. Clause 5 is irrelevant for present purposes unless the effect of cl 5(2) is to expand the power conferred by Pt 20 to allow a regulation to extinguish rights accrued prior to the date of publication. Clause 5 has no regulation-making power: that power is found in Pt 20, as qualified or expanded by cl 5 [27].

13. It follows that while cl 5 expands the temporal reach of the power conferred by Pt 20, cl 1(2) to make a transitional regulation having effect from a date prior to its publication, it does not expand the consequences of such a regulation. As the transitional regulation did not seek to backdate its operation to a point prior to the date of assent of the 2012 Amending Act, cl 5(1) was not relevant [28].

(c) Accrued rights

14. Prior to its amendment, under s 66, the entitlement or right may be said to arise once two events have occurred: (a) receipt of an injury, and (b) a resultant permanent impairment [29].  His Honour noted previous authority for the conclusion that the right to compensation under s 66 accrues at the time of injury: Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318 at 327; followed in TNT Australia Pty Ltd v Horne (1995) 36 NSWLR 630; Perrot v Crisp [1999] NSWCA 239 and Speirs v Industrial Relations Commission (NSW) [2011] NSWCA 206; 81 NSWLR 348. [30]-[31].

15. It follows that a “right” to compensation arose at the date of injury, although quantification of the amount payable depended on agreement or an award [32].

16. The applicant had a right to obtain a benefit under s 66 which accrued at the date of injury. To the extent that the transitional regulation sought to prejudicially affect that right, it was beyond power and invalid. The applicant is entitled to compensation under s 66 to be calculated in accordance with that provision as it stood prior to the 2012 amending Act [33].

CONSTITUTIONAL LAW - whether State Act inoperative because inconsistent with Commonwealth Act - application of Commonwealth Act to be determined in accordance with its terms - scope of operation of Commonwealth Act - construction of s 108A(7) - Constitution, s 109.  WORKERS COMPENSATION - the 1987 Act, s 17(1) - meaning of "employer by whom the worker was employed in an employment to the nature of which the injury was due" - whether employer licensed under the Safety, Rehabilitation and Compensation Act 1988 (Cth) was an "employer" for the purposes of the State Act.  Entitlement to compensation - when injury occurred - whether liability of employer which arose under State Act preserved by Commonwealth Act - where worker worked for the same company during the relevant period - where during the relevant period the employer became licensed under the Commonwealth Act

Q: Whether by operation of s 17(1)(a)(i) of the Workers Compensation Act 1987 (the 1987 Act), the applicant's binaural hearing loss is deemed to have occurred on 30 June 2008 when the employer ceased to be insured under the New South Wales Workers Compensation Acts or on 24 March 2011 when the claim for compensation was made, at which time the employer was insured under the Safety, Rehabilitation and Compensation Act 1988 (Cth).

The President answered the question as follows:

A. By operation of s 17(1)(a)(i) of the Workers Compensation Act 1987, the applicant's binaural hearing loss is deemed to have happened on 24 March 2011, when the claim for compensation was made.

An application was made to the Court of Appeal for leave to appeal under s 353(4) of the 1998 Act.

Held: appeal allowed

The Court of Appeal answered the question as follows:

A: (a)Under s 17(1) of the Workers Compensation Act 1987 (NSW), the applicant's binaural hearing loss was deemed to have happened on the last day before the employer's licence under the Safety, Rehabilitation and Compensation Act 1988 (Cth) came into force, namely 30 June 2008.

(b) If, under the Safety, Rehabilitation and Compensation Act, the applicant's binaural hearing loss was taken to have occurred after the employer's licence under that Act came into force, that Act applied to the applicant's injury, but any liability or obligation of the respondent under the Workers Compensation Act in respect of the injury occurring before the licence came into force was, by virtue of s 108A(7) of the former Act, unaffected.

(c) If, under the Safety, Rehabilitation and Compensation Act, the applicant's binaural hearing loss was taken to have occurred before the employer's licence under that Act came into force, neither that Act nor the licence applied to the applicant's injury.

Safety, Rehabilitation and Compensation Act 1988

108 License can authorise licensee to accept liability

(1) A licence may provide that the licensee is authorised to accept liability to pay compensation and other amounts under this Act in respect of particular injury, loss or damage suffered by, or in respect of the death of, some or all of its employees under this Act.

(2) The scope of the licence, so far as it authorises acceptance of liability to pay such compensation and other amounts, may be determined by the Commission.

(3) The Commission may determine, as part of the scope of the licence, that the licensee may accept such liability in respect of such injury, loss, damage or death occurring at a time before the licence came into force.

108A The consequences of a licensee's authorisation to accept liability

(1) If:

(a) a licensee is authorised to accept liability to pay compensation and other amounts under this Act in respect of particular injury, loss or damage suffered by, or in respect of the death of, some or all of its employees; and

(b) such injury, loss, damage or death occurs;

then:

(c) the licensee is liable to pay compensation and other amounts under this Act in respect of that injury, loss, damage or death; and

(d) Comcare is not liable to pay compensation or other amounts under this Act in respect of that injury, loss, damage or death.

...

(7) If a licensee who is a corporation is authorised to accept liability to pay compensation and other amounts under this Act in respect of a particular injury, loss or damage suffered by, or in respect of the death of, some or all of its employees after the licence comes into force then:

(a) no law of a State or Territory relating to workers compensation applies to a licensee in respect of such injury, loss, damage or death; and

(b) any liability or obligation of the corporation under a law of a State or Territory in respect of such injury, loss or damage suffered, or death occurring, before the licence came into force is unaffected.

Basten JA (Macfarlan and Barrett JJA agreeing)

1. The liability of TNT under the Commonwealth Act depends on the terms of the licence and the terms of the Commonwealth Act.  Clause 4 of TNT’s licence authorised the licensee to accept liability in respect of all injuries of any employees of a licensee “where such injuries … occur within the period of the licence” [8].

2. On the basis that the licence covered the kind of injury suffered by Mr Lennon and covered him as an employee of TNT, the critical provisions of the Commonwealth Act are found in s 108A. The first question raised by s 108A(1)(b) is when the injury “occurs” for the purposes of the Commonwealth Act.  Injury includes a “disease”: s 5A [9]-[10].

3. The time at which an employee sustains an injury, being a disease, is dealt with in s 7. Pursuant to that section, the date on which the injury was sustained must be either the date when the applicant first sought medical treatment for his hearing loss or the date of the “impairment”, whichever happened first: s 7(4)(b) and (c). Mr Lennon said in his statement of 5 July 2010 that he “first noticed [his] hearing loss a couple of years ago”. There was also evidence of an assessment of permanent impairment undertaken on 1 March 2011. There has been no finding as to whether these events occurred [12].

4. Section 108A(7) provides that no State law relating to workers compensation applies to a licensee in respect of an injury “suffered by” its employees after the licence comes into force [13].

5. There was a difference of view as to the proper construction of s 108A(7). The Attorney General for New South Wales submitted that the phrase at the end of the chapeau, “after the licence comes into force” applied to the time at which the licensee was authorised to accept liability to pay compensation (and thus came under an obligation to pay it), without backdating under s 108(3). That was an awkward reading of the language, suggesting that the words "after the licence comes into force" should have followed immediately upon the words of obligation to pay amounts "under this Act”. The alternative construction was that the temporal clause applied to the time the injury is suffered. As s 108(3) permits liability to extend to injury occurring before the licence came into force, on any view the latter construction is preferable [14].

6. It would follow that a similar construction should apply to the temporal clause “before the licence came into force" at the end of paragraph (b). Not only does that clause follow immediately upon the reference to injuries suffered, but, if it were intended to qualify the liability or obligation of the corporation under State law, it would be necessary to insert the words “which arose” before the temporal clause, in order to give it grammatical effect. The preferable reading is that paragraph (b) refers to an injury which was suffered before the licence came into force [15].

7. If, by application of the Commonwealth Act, the injury occurred after the licence took effect on 1 July 2008, the State Act did not apply: s 108A(7)(a). If the injury had, by application of the Commonwealth Act, arisen before the licence came into force, then that Act would not apply to it: that is, s 108A(1) and (7) read together do not envisage a licence applying except in respect of an injury suffered after it comes into force [17].

8. However, if the Commonwealth Act did not apply, it would not be inconsistent with a State Act. Because the tests under s 7(4) of the Commonwealth Act and 17(1) of the 1987 State Act differ, a single injury of gradual onset could be taken to have occurred at different dates under each provision. If, for the purposes of the Commonwealth Act, the applicant first sought medical treatment for his hearing loss or the impairment arose before the date of the licence, the Commonwealth Act would not apply to that injury. According to the President, under the State Act the applicant's loss was deemed to have happened on 24 March 2011, when the claim for compensation was made. If that were correct, the State Act applied in its terms, and TNT was an employer subject to liability under the State Act, regardless of the existence of the Commonwealth licence. Because the State and Commonwealth Acts must each be applied in its own terms, the result is not anomalous [18].

Liability under State law

9. The right to compensation under s 66 of the 1987 State Act accrues at the time of injury: Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318 at 327, Priestley JA (Handley and Sheller JJA agreeing); TNT Australia Pty Ltd v Horne (1995) 36 NSWLR 630; Perrott v Crisp [1999] NSWCA 239. The form of the relevant provisions has changed, but the approach adopted by this Court has not: Speirs v Industrial Relations Commission (NSW) [2011] NSWCA 206; 81 NSWLR 348, at [85] (Giles JA; Allsop P and Hodgson JA agreeing) [21].

10. It follows that a right to compensation, with a correlative “liability” in TNT, arose when the injury occurred, although quantification of the amount payable depended on agreement or an award of the Commission. The date of the injury is to be determined under s 17(1)(a) of the 1987 Act [22]-[23].

11. The applicant argued before the Commission that his “employment” changed when TNT obtained a licence under the Commonwealth Act. Accordingly, he submitted, the hearing loss was deemed to have occurred under sub-paragraph (ii) on the last day on which he was employed by TNT before it obtained its licence under the Commonwealth Act, namely 30 June 2008. This was rejected by the President who concluded that the term “employment” did not depend on whether the employment was covered by the 1987 Act, but on the physical nature of the employment [24]-[25].

12. Mr Lennon relied on Russo v World Services and Constructions Pty Ltd [1979] 1 NSWLR 330. In that matter the Court of Appeal, Hope JA (with whom Hutley and Mahoney JJA agreed) noted that the 1926 Act applied to workers employed by or under the Crown, but construed the section as applying only to the Crown in right of New South Wales, so that, on its proper construction, the term “employer” in s 7(4) of that Act did not include the Commonwealth. In that event, the worker had no “employer” within the meaning of s 7 at the date of the application and the company was the last employer and the Commission had properly held the company liable [29].

13. The respondent contended Russo had no application as there had been no change in Mr Lennon’s employer nor had TNT become the Commonwealth. Accordingly, the State Act should not be construed so that the reference to “employment” in s 17(1) did not extend to employment by TNT after it obtained the licence under the Commonwealth Act. It submitted that the applicant had at all times been, and remained, “in an employment to the nature of which the injury was due” and the injury therefore happened at the time when the notice was given [30].

14. Mr Lennon also relied on A & G Engineering Pty Ltd v Civitarese (1996) 41 NSWLR 41. In that case, there were two periods of noisy employment, the latter being in the Northern Territory. The judgment of Beazley JA (with whom Handley and Sheller JJA agreed) stated “s 17 operates so as to make the appellant the last employer. In other words, the appellant is the last employer to whom the legislation applies and is thus liable to pay compensation”. [31]

15. Mr Lennon argued that although there was no change of employer in his case, TNT changed from being an employer which was covered by the State Act, to one which was not [32].

16. Section 17(1)(a) does not focus on the “employer” but on “an employment” to be characterized according to the injury.  Section 17(1) read as a whole has three purposes in relation to an injury caused by a gradual process, namely:

(a) to identify the time at which the injury is taken to have occurred;

(b) to identify the person responsible for paying compensation, and

(c) to make provision for contribution by other employers.

17. The term “employer” is defined in s 4(1) of the 1998 Act. The effect of Russo and A & G Engineering is that the term “employer” does not extend to the Crown in right of the Commonwealth or employers in other law areas within or outside Australia. Because TNT was, from 1 July 2008, no longer an employer to which the obligations of the Act attached, the applicant thereafter did not have an employer for the purposes of the Act. Accordingly, applying the reasoning in those authorities, TNT was liable, not as the worker’s employer at the time of giving notice, but as the last employer by whom the worker was employed in relevant employment, before he gave notice: s 17(1)(c)(iii).  If that is the correct construction of s 17(1)(c), consistency requires that a similar reading be given to paragraph (a), so that the injury was deemed to have happened on the last day on which the worker was employed in a relevant employment before he or she gave notice, which was 30 June 2008 [36].

18. One of the arguments which found favour in Russo turned on the operation of s 14A of the Interpretation Act 1897 (NSW), now to be found in s 31 of the Interpretation Act 1987 (NSW). That section requires that an Act “shall be construed as operating to the full extent of, but so as not to exceed, the legislative power of the Parliament". The section then provides that if any provision “would, but for this section, be construed as being in excess of the legislative power of Parliament ... it shall be a valid provision to the extent to which it is not in excess of that power”: s 31(2)(a). Thus, in Russo, the obligation so to construe the 1926 Act led to the term "employer" being read as excluding the Commonwealth, even if it were otherwise capable of including the Commonwealth [37]

19. That conclusion must be assessed in the light of the reasoning of the High Court in Telstra Corporation Ltd v Worthing [1999] HCA 12; 197 CLR 61. Mr Worthing had worked for the Australian Telecommunications Commission (at which time he had suffered two injuries to his back) and for Telstra, at which time he had suffered a further injury to his back. The Commission did not exercise the executive power of the Commonwealth, although it would have been liable to suit under s 75(iii) of the Constitution as the Commonwealth or a person being sued on behalf of the Commonwealth: at [15]. The Court accepted that there was nothing in either the 1926 Act or the 1987 State Act which precluded the expression "employer” referring to either the Commission or Telstra, as persons or bodies which employed people: at [17]. Telstra held a licence under the Commonwealth Act, but neither it nor the Commonwealth Attorney submitted that, with respect to the injury suffered whilst Mr Worthing was employed by Telstra, “Telstra was other than an employer within the meaning of the 1987 State Act”: at [26]. In respect of each injury, the Court held that the State Act was inoperative by reason of s 109 of the Constitution [39].

20. To construe the 1987 State Act in the present case as not covering employment in respect of which the State Act was inoperative by reason of the operation of s 109 and the Commonwealth Act, would be to adopt a construction of the State Act which was rejected by the High Court in Telstra v Worthing. Although the reasoning of the Court did not address the argument under the Interpretation Act, it did address the application of the reasoning in Russo, which in turn relied upon that provision. At least by implication, it must be assumed that the High Court rejected any extension of that argument which would now allow the 1987 State Act to be read down so as not to include employment by a licensee under the Commonwealth Act [40].

21. Another reason for not adopting an expansive operation for s 31(2) of the Interpretation Act is that it would, in effect, require a reconstruction of each State provision subject to s 109, so as to provide a variable operation, for example with respect to the Workers Compensation Act, depending upon whether a particular employer had or had not been granted a licence under the Commonwealth Act. Such an approach would not be consistent with standard practice in respect of dealing with questions of inconsistency with Commonwealth laws, despite the common occurrence of provisions equivalent to s 31 [41].

(a) failing to properly assess the history and correspondence between the parties;

(b) applying the principles in Warwar v Speedy Courier (Aust) Pty Ltd [2010] NSWWCCPD 92, and

(c) incorrectly deciding what each party, by words and conduct, would have led a reasonable person in the position of the other party to believe.

Held: The Arbitrator’s determination confirmed

Discussions and Findings

1. The reference in the appellant’s submissions, and in the s 74 notice, to Mr Piper having suffered an “injury” to his left shoulder was wrong. Mr Piper had never suffered (or alleged that he suffered) a s 4 injury to his left shoulder. His claim had always been that the condition of his left shoulder had resulted from the accepted injury to his right shoulder (Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452; 10 NSWCCR 796) [31].

2. The effect of the complying agreement had to be interpreted according to the usual principles of contract law. The High Court considered the principles relevant to the construction of a contract in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; 219 CLR 165 at [40] where it was said:

“The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction” (emphasis added) [33]

3. The High Court has since stated that the “true rule” as to the admission of evidence of surrounding circumstances is that stated by Mason J in Codelfa Construction Pty Ltd v State Rail Authority (NSW) [1982] HCA 24; (1982) 149 CLR 337 (Codelfa) at 352 (see Western Export Services Inc v Jireh International Pty Ltd [2011] HCA 45), which suggests that resort can only be had to surrounding circumstances in the case of ambiguity (Cordon Investments Pty Ltd v Lesdor Properties Pty Ltd [2012] NSWCA 184) [35]-[36].

4. In view of the current uncertainty as to whether, in the absence of ambiguity, it was permissible to consider the surrounding circumstances known to the parties in interpreting a contract, the Commission considered both situations in the alternative [37].

5. Looking at the words of the complying agreement and interpreting those words objectively, it was clear that the settlement only applied to, and only resolved the claim for, lump sum compensation for whole person impairment as a result of the injury to Mr Piper’s right shoulder. This followed from the fact that the agreement only referred to the injury to the right shoulder and, under “Particulars of this agreement”, recorded the “percentage loss” as eight per cent. Under “the body part/system/process” the words “right shoulder” appeared and under “amount payable”, the figure of $10,000 was entered. The complying agreement did not refer to any consequential condition, or to any other body part [38]. The terms of the complying agreement were clear and unambiguous. The parties settled Mr Piper’s claim for lump sum compensation for his right shoulder injury for $10,000, which figure represented an eight per cent whole person impairment [39].

6. Consistent with Codelfa, it was not permissible to look to the surrounding circumstances to contradict the language of the agreement when it had a plain meaning. If this approach was wrong, and it was open to consider the surrounding circumstances, those circumstances did not lead to a different conclusion [40].

7. It was completely illogical that a properly advised worker would give up his valuable rights to lump sum compensation for his left shoulder, and the possibility of obtaining compensation for pain and suffering, in return for an additional one per cent compensation for his right shoulder injury, worth only $1,250 [43].

8. The proposition that the insurer was being more than generous in allowing eight per cent for the right shoulder injury, when Mr Piper’s highest assessment was seven per cent, was not accepted. Nor was it accepted that a reasonable person in the position of Mr Piper would have realised that, by offering that amount, CGU intended to resolve both claims. The insurer would have been well aware that, faced with assessments of eight per cent from Dr Robinson and seven per cent from Dr Searle, there was every possibility an AMS would find eight per cent. In these circumstances, it was appropriate to offer eight per cent for the right shoulder [44].

9. If CGU intended to resolve both claims, it could have included in the complying agreement a term, as was included in CSR Ltd v Gonzales [2010] NSWWCCPD 118, that the agreement represented the full extent of any entitlement Mr Piper had to lump sum compensation as a result of his injury. It did not do that [45].

10. That the offer was based on Dr Robinson’s report did not mean that the offer of eight per cent was conditional upon Mr Piper relinquishing his rights in respect of his left shoulder. Nothing in the surrounding circumstances suggested that that was the objective intention of the parties [49]. The Senior Arbitrator’s conclusion was open and disclosed no error [50].

(a) having agreed to allow cross-examination, reversing that decision because of Mr Murphy’s “truculent” failure to cooperate denied the Club procedural fairness (denial of procedural fairness);

(b) applying ss 42(1)(d) and 43 of the 1987 Act, as there was no evidence upon which to calculate Mr Murphy’s weekly earnings and in the calculation of Mr Murphy’s average weekly earnings such that the conclusion as to weekly benefits was erroneous (weekly compensation);

(c) reversing the onus of proof (onus of proof);

(d) accepting Mr Murphy’s evidence when there was no logical or proper basis to do so (accepting Mr Murphy’s evidence);

(e) concluding that Mr Murphy was engaged in riding work in connection with horse racing on the racecourse at the time of his alleged injury “on 22 March 2006 [sic, 22 October 2006]”, and

(f) assimilating riding work in connection with horse racing to track work riding.

At the oral hearing of the appeal, counsel for the Club did not press grounds (e) and (f).

Held: The Senior Arbitrator’s determination revoked; remitted to a different Arbitrator for re-determination 

Procedural fairness

1. The seminal authority on cross-examination in the Commission (Aluminium Louvres & Ceilings Pty Ltd v Zheng [2006] NSWCA 34; 4 DDCR 358 (Zheng)) was applied [33].

On which issues did the Senior Arbitrator grant leave to cross-examine?

2. The probabilities favoured the conclusion that the Club had sought, and been granted, leave to cross-examine Mr Murphy on injury, wages and dependency [53].

Why was cross-examination terminated?

3. It was not disputed that the cross-examination concluded on 22 February 2012 because of Mr Murphy’s conduct, but it was not known how far cross-examination had progressed before the matter was adjourned [54].

Did the Senior Arbitrator err in terminating cross-examination?

4. Consistent with the approach in Zheng, the determination of this question required the consideration of the evidence, the matters on which it was sought to cross-examine Mr Murphy, the Senior Arbitrator’s reasons and whether, having regard to the evidence and the issues, the termination of the cross-examination amounted to a denial of procedural fairness [56].

5. Unlike Zheng, the cross-examination in the present case was terminated because of the worker’s conduct, not because the Senior Arbitrator refused to allow Mr Mansfield to put specific questions or explore specific topics. Nevertheless, the nature of the issue on which cross-examination was to be pursued was relevant to determining if there had been a denial of procedural fairness. In Zheng, the Court of Appeal held that the topic on which the solicitor was not permitted to cross-examine, namely, the time of the altercation, could not, on any view, have been “an important matter” because the participants of the altercation had already started work [80].

6. As noted in Zheng, when a claim is made that natural justice (procedural fairness) has not been accorded, regard must be paid to the legal context in which the decision-maker operates and to the law regulating the conduct of the proceedings [87].

7. The legal context in the present case was that cross-examination in the Commission is only allowed by leave. As Bryson JA noted in Zheng, s 354 of the 1998 Act provides that proceedings in the Commission are to be conducted with as little formality and technicality as the proper consideration of the matter permits (s 354(1)); that the Commission is not bound by the rules of evidence but may inform itself on any matter in such manner as it thinks appropriate (s 354(2)); that the Commission is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal form (s 345(3)); and that proceedings need not be conducted by formal hearing (s 354(4)) [88].

8. Nevertheless, an Arbitrator in the Commission is subject to obligations of procedural fairness (State Transit Authority (NSW) v Chemler [2007] NSWCA 249; 5 DDCR 286 at [65]; South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16; 4 DDCR 421 at [91]; Fletcher International Exports Pty Ltd v Lott [2010] NSWCA 63 at [42] and [63]; Duinker v St Vincent de Paul Society Aged & Special Services Ltd (Lewisham Nursing Home) [2008] NSWCA 127; 6 DDCR 266 at [33]) [89].

9. While many of the points raised by counsel for the Club had limited, if any, relevance to the issue of whether Mr Murphy received an injury on 22 October 2006, and several were completely without merit, with considerable reluctance it was concluded that cross-examination should have been permitted on injury and, in the circumstances of the case, the termination of cross-examination had resulted in procedural unfairness, or “practical injustice”, to the Club [91].

10. The Commission was not satisfied that the inability to cross-examine, which came about because of Mr Murphy’s conduct, on issues about whether the injury occurred in the circumstances Mr Murphy alleged would have made “no possible difference to the result” (Stead v State Government Insurance Commission [1986] HCA 54; 161 CLR 141 at 146) [93].

11. In the absence of some evidence that, because of some medical or other condition, Mr Murphy was unable to answer reasonable and relevant questions put to him by Mr Mansfield, it was not appropriate to terminate the cross-examination and conclude the case on written submissions. The cross-examination should have continued and Mr Murphy’s answers and demeanour assessed along with the other evidence [94].

12. That the application to cross-examine extended beyond the issue of dependency was clear. The Senior Arbitrator erred in dealing with the issue of cross-examination by referring only to the application to cross-examine with regard to dependency [95].

13. The award rate allowed was less than any of the alternative figures advanced by Mr Murphy and cross-examination could not have achieved a better outcome for the club. In the circumstances, the termination of cross-examination was of no consequence as far as Mr Murphy’s earnings were concerned [98].

14. As to cross-examination on dependency, the Senior Arbitrator correctly noted that the inability to cross-examine a witness does not necessarily result in unfair prejudice. The main reason for wanting to cross-examine on dependency seemed to have been that that claim arose for the first time at the 25 August 2011 arbitration. In other words, it was a late claim that had not been included in the original application. The Club did not advance any other basis, either on appeal or before the Senior Arbitrator, for requiring leave to cross-examine on dependency. In these circumstances, it was difficult to see that the termination of cross-examination on this issue had caused the Club prejudice [99].

Weekly Compensation

15. The terms of s 43(1)(a)(i) and (ii) did not apply in this case. The Senior Arbitrator also failed to address the terms of cl 9(3) of Sch 1 when determining Mr Murphy’s average weekly earnings [121].

16. The exceptions in s 43(1)(a) only apply in the specific circumstances stated, namely where, “because of the shortness of the time during which the worker has been in the employment of the employer or the terms of the employment” it is impractical at the date of injury to compute the rate of remuneration, regard may be had to the circumstances in sub-s (i) or (ii) [122].

17. It was not impractical, because of the shortness of the time during which Mr Murphy had been employed, to compute his rate of remuneration at the date of his injuries. Nor was it “impractical” to make such a calculation because of his “terms of the employment”. Because Mr Murphy was self-employed, there were no “terms of employment” [123].

18. The Senior Arbitrator based her findings on the submission made to her that s 42(d) applied and that she was required to consider s 43. She did not consider the terms of cl 9(3) of Sch 1. As neither side drew her attention to cl 9(3), it was hardly surprising that she did not refer to it. While her conclusion may well have been open under cl 9(3), and it may well have been reasonable in the circumstances to rely on the Horse and Greyhound Award, she did not approach the matter in that way [124]. That did not mean, however, that the Club was entitled to an award in its favour [125].

19. As Mr Murphy was not working under a contract of service, it was open to calculate his average weekly earnings “in such manner as” the Commission considered “reasonable in the circumstances” (cl 9(3) of Sch 1). In the appropriate case, it would be open to re-determine the matter on appeal in light of the terms of cl 9(3). However, in view of the other issues involved (both as to earnings and injury) and, as the question of whether Mr Murphy received an injury on 22 October 2006 was to be re-determined, it was not appropriate to re-determine Mr Murphy’s average weekly earnings on appeal [125].

20. The current weekly wage rate for a worker who is deemed to be a worker for the purposes of the 1987 Act may be derived from an award which fixes an award for the kind of work performed by the independent contractor. Section 42(3) is therefore applicable to applicants who (like Mr Murphy) are self-employed at the time of injury, but are deemed workers under the legislation [126].

21. Thus, applying s 42(3), it was clear that, in determining Mr Murphy’s current weekly wage rate, he was entitled to rely on the award under which he would be remunerated if he had performed his work under a contract of service. The Horse and Greyhound Award would seem to be the appropriate award and that award would apply to determine the current weekly wage rate for periods of total incapacity without resort to s 43 and without resort to the “prescribed proportion” in s 42(8). This gave a higher figure than the figure allowed by the Senior Arbitrator [127].

22. In calculating Mr Murphy’s probable earnings but for his injury in the periods of partial incapacity, the alternative methods referred to in Cage Developments Pty Ltd v Schubert [1983] HCA 37; (1983) 151 CLR 584; [1981] 2 NSWLR 227 would apply [128].

Onus of proof

23. The Senior Arbitrator had not reversed the onus of proof. Her comments were directed to whether the inability to cross-examine on dependency caused any “unfair prejudice” [130].

Accepting Mr Murphy’s Evidence

24. It was open to the Senior Arbitrator to accept Mr Murphy’s explanation for why he had not reported the October 2006 incident, namely, because he thought he would recover, to find that he was stoic, and, subject to the procedural fairness issue, to accept his evidence on injury [136].

25. The submission that Mr Murphy’s conduct at the arbitration was such that the Senior Arbitrator should have disbelieved his evidence on injury (and erred in not disbelieving him) raised a separate issue that was not possible to determine without a transcript and, in any event, was not necessary to determine in circumstances where the matter was to be re-determined [137].

“After work I spent a couple of hours drinking and playing pool in Score Bar. As I was riding my pushbike home a taxi pulled out in front of me and I collided with it and fell heavily. I was not wearing a helmet and aggravated an old shoulder injury.”

(a) failing to give sufficient or proper reasons (reasons);

(b) failing to use or palpably misusing the advantage she had of seeing and hearing Mr Avnell give evidence (reasons);

(c) applying a test of “impairment” in considering the defence under s 10(2) (the statutory test), and

failing to identify the statutory test she was required to apply (the statutory test).

Held: The Arbitrator’s determination confirmed

Reasons

1. An Arbitrator does not have to make explicit findings on each disputed piece of evidence, “especially if the inference as to what is found is appropriately clear”, but “should provide reasons for making the relevant findings of fact (and conclusions) and reasons in applying the law to the facts found” (Beale v Government Insurance Office (NSW) (1997) 48 NSWLR 430 (Beale) at 443). It is not an error of law to omit to state expressly a finding that is clear on a fair reading of the decision-maker’s decision (Polglaze v Veterinary Practitioners Board (NSW) [2009] NSWSC 347 (Polglaze) at [46] and [55]–[56]) [47].

2. Consistent with Beale and Polglaze, it is not an error if the foundation for the Arbitrator’s conclusion is indicated “as a matter of necessary inference” (Sun Alliance Insurance v Massoud [1989] VicRp 2; [1989] VR 8 at 19 (cited with approval in Musija v Kresa [2010] VSCA 163 [54]–[58])). There is no need to expressly reject evidence if it can be inferred that it has been rejected by the acceptance, for reasons given, of contrary evidence (National Australia Bank Ltd v KRDV [2012] FCA 543; 292 ALR 639 at [61]) [48].

3. The Arbitrator’s reasons complied with her duty to explain the basis for her conclusion [51]. The Arbitrator’s statement that there had been “some inconsistency” in Mr Avnell’s evidence was correct (see [6] below). Moreover, she properly acknowledged that the cross-examination brought into question Mr Avnell’s credit [52].

4. In the absence of an explanation for a significant inconsistency in his prior statements, which were given on the same day, it was not necessary for the Arbitrator to deal further with this evidence. On reading the Arbitrator’s reasons as a whole, her noting of this unexplained inconsistency, along with the other inconsistencies noted, was a clear indication that Mr Avnell’s evidence was unreliable [58].

5. After referring to the inconsistencies in Mr Avnell’s evidence, the Arbitrator said that she preferred the evidence in the Figtree report, which Mr Crowley had created, and which she found “significant”. Her reasons for doing so were:

(a) it was the “clearest of evidence” and the evidence “closest in time” to the accident;

(b) Mr Crowley had no “axe to grind”;

(c) Mr Crowley put into first person the account provided to him and recorded in the Figtree report, and

(d) the account provided to Mr Crowley was in short succinct terms and was that Mr Avnell had gone to Score for a couple of hours and had consumed alcohol.

Those reasons were open on the evidence. As Mr Crowley had no continuing association with Star City, his evidence was genuinely independent and entitled to considerable weight. The preparation of the Figtree report was fully explained by Mr Crowley and his explanation went to its reliability and authenticity. That the Figtree report was written in first person, was in clear and succinct terms, and was recorded within hours of the accident were factors that were proper to take into account in weighing its probative value [59]-[60].

6. The Arbitrator was entitled to prefer the evidence in the Figtree report to the inconsistent evidence of Mr Avnell. Her acceptance of the account in the Figtree report necessarily involved a rejection of Mr Avnell’s evidence, which was incorrect on the issue of the lighting at the time of the accident, was inconsistent with documentary evidence on the issue of whether he had a prior shoulder injury, and was internally inconsistent as to whether Score was even open on the morning of 1 January 2009 (an inconsistency for which Mr Avnell had no explanation) [61].

7. It was of no consequence that the Arbitrator made no comment of her impression of Mr Avnell. Her reference to the inconsistencies in his evidence, when viewed against her acceptance of the Figtree report, was sufficient to discharge her duty to explain the basis for her conclusion. To the extent that the Arbitrator had to “resolve” any credit issue, it was clear from a reading of the decision as a whole that she did so by accepting the near contemporary evidence in the Figtree report and (implicitly) rejecting Mr Avnell’s evidence [65].

8. The Arbitrator asked the parties if any further reasons were required and was apparently told “no”. In these circumstances, it was difficult to see how the appellant could complain that the Arbitrator erred in failing to give adequate reasons. She did not. She explained the basis for her conclusion and was not requested to expand on that explanation when the parties were given an opportunity to make such a request [67].

The Statutory Test

9. The Arbitrator correctly observed that Mr Avnell acknowledged there had been a deviation (or interruption) and that (in these circumstances) “the onus pursuant to a section 10(2) is on the worker to establish the risk of injury was not materially increased because of the interruption or deviation”. This was a correct statement of the statutory test, and of who carried the onus of proof (Babcock Australia Ltd v Proudfoot [1993] NSWCC 30; 9 NSWCCR 525) once it was established (as it had been in this case) that the injury was received during or after an interruption of, or deviation from, a journey to which s 10 applies [72].

10. After referring to the evidence in the Figtree report, the Arbitrator found that Mr Avnell was “impaired due to a mixture of alcohol and tiredness”, noting Dr Slezak’s evidence that impairment occurred with a mixture of alcohol and tiredness. The reference to Mr Avnell having been “impaired” was merely a preliminary (and accurate) statement based on the unchallenged evidence from Dr Slezak. That was not, however, the test the Arbitrator applied and her analysis did not end with, or depend on, that statement [73].

11. The Arbitrator added that, while there was insufficient evidence before her as to the level of alcohol (Mr Avnell consumed), she found that the combination (of tiredness and alcohol) “was sufficient to establish that the risk of injury was materially increased” and she therefore made an award for Star City. This was, on one view, an incorrect application of the statutory test because it (wrongly) implied that it was for Star City to prove a material increase in the risk of injury [74].

12. Once it was accepted that the accident occurred after an interruption, it was not necessary for Star City to establish that the risk of injury was materially increased. Rather, as the Arbitrator initially stated, Mr Avnell had to establish that the “risk of injury was not materially increased because of the deviation or interruption” [75].

13. The contest was not about how much alcohol Mr Avnell consumed, but about whether he consumed any alcohol. Having accepted that he was at Score drinking for a couple of hours, it was open to the Arbitrator to accept Dr Slezak’s unchallenged evidence and to find that the interruption had materially increased the risk of injury [83].

14. Mr Avnell’s case was that he had not been drinking. The Arbitrator rejected that case and accepted the evidence in the Figtree report that he had been drinking for a couple of hours. That was the assumption made by Dr Slezak and it was therefore open to the Arbitrator to accept his evidence. Accepting Dr Slezak’s evidence necessarily involved an implicit finding that Mr Avnell had not negatived the assumptions made by Dr Slezak. The result was that the Arbitrator was entitled to find that there had been a material increase in the risk of injury, which finding also encompassed the less demanding finding that Mr Avnell had not established that the risk of injury was not materially increased [86].

(a) employment with the appellant was the last relevant employment, having regard to s 16 of the 1987 Act;

(b) the appellant was liable to pay compensation to which the worker may be found entitled following conduct of a medical assessment, and

(c) the appellant pay the costs of the worker and of the other employer (second respondent).

Held: The Arbitrator’s determination was confirmed. 

Fresh or additional evidence

1. The appellant sought leave pursuant to s 352(6) of the 1998 Act to adduce a report of Dr Hunter J. Fry, plastic reconstructive & hand surgeon, dated 31 October 2012, together with other documents listed in a “schedule of fresh evidence”.

2. The appellant failed to establish that any of the material which it sought to adduce on appeal was either not available before the hearing or, could not reasonably have been obtained for presentation at the hearing [36].

3. The demands of justice did not require that those other documents listed in the “schedule of fresh evidence” be admitted in evidence on appeal [38].

4. The question as to whether the interests of justice required that Dr Fry’s latest report be admitted involved an assessment of its probative value concerning the issue as to whether employment with the second respondent was employment that was a substantial contributing factor to the aggravation, acceleration, exacerbation or deterioration of Mr Watson’s skin disease as diagnosed [43].

5. It was not accepted that Dr Fry’s latest report could have any probative value. The weight of that evidence had to be assessed not by reference only to the existence of the revised history and the evidence as a whole, but also to the absence of any statement by Dr Fry that the second respondent’s employment was a “substantial contributing factor” in terms of s 16(1)(b) of the 1987 Act [47].

6. The application for leave was refused [38], [48].

The Arbitrator’s refusal of the adjournment application

7. The appellant purported to seek leave to appeal against the Arbitrator’s refusal of its adjournment application made at the hearing. (The appellant sought an adjournment of the hearing to obtain a report from Dr Fry, that could not be obtained prior to the hearing.) The refusal of the Arbitrator was, it seemed, treated by the appellant as an interlocutory order thus, by inference, the leave application was made pursuant to s 352(3A) of the 1998 Act [49].

8. Such a complaint concerning an impugned interlocutory order may be raised as a substantive ground on appeal without the need for a grant of leave to argue the matter (Gerlach v Clifton Bricks Pty Ltd [2002] HCA 22; 209 CLR 478 at 483) [50].

9. Given the tardiness of the appellant’s approach to preparation of its defence; the prejudice to the other parties that would have resulted from any adjournment granted, and, in particular, the absence of any knowledge as to the character of evidence intended to be presented at the time the adjournment application was made, it was found that the appellant failed to demonstrate any relevant error [54].

The grounds of appeal

Ground one

10. The appellant was wrong to suggest that the Arbitrator relied upon the evidence of Dr Haddad as proof concerning its liability [56].

Ground two

11. The suggestion of error concerning the Arbitrator’s reliance upon the evidence of Dr Susanne Freeman, occupational dermatologist, qualified by Mr Watson’s solicitor, was rejected. The evidence of Dr Freeman established that the appellant’s employment of Mr Watson was a substantial contributing factor to the subject injury, that evidence was consistent with the evidence of Dr Fry and with the concession made on behalf of the appellant. Dr Freeman’s evidence was not treated by the Arbitrator, as suggested by the appellant, as being relevant to the question concerning the role of the employment with the second respondent and its relevance to the question of liability. The appellant’s reliance upon the decision of Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705 (Makita) was misconceived given that Dr Freeman’s evidence did not touch upon that issue, nor could it have been said that the Arbitrator relied upon that evidence with respect to that dispute [57].

Ground three

12. This ground erroneously asserted that the Arbitrator made a finding that the appellant had no basis for declining Mr Watson’s claim in its s 74 Notice. Of the five reasons given by the appellant for denial of liability, four were later abandoned. The remaining reason, being a denial that it was the last relevant employer, was addressed by the Arbitrator and that reasoning demonstrated no relevant error. Further, the ground failed as it was founded upon a misconception of the reasons advanced by the Arbitrator for his determination [58].

Ground four

13. The challenge to the Arbitrator’s reliance upon the evidence of Dr Fry as being “probative of liability in the appellant” was rejected. Such an assertion was, as argued, absurd given Dr Fry’s evidence concerning the relevance of employment with the appellant being that Mr Watson “has had sufficient outdoor solar exposure during his 10 years [with the appellant] from age 26–36 for his solar exposure to be a substantial contributing factor to his hyperkeratoses” [59].

14. The opinion of Dr Fry was not in any relevant manner compromised having regard to the absence of any relevant history which had been established on the evidence [61].

Grounds five and six

15. These grounds challenged the Arbitrator’s findings concerning the appellant’s liability with respect to Mr Watson’s injury. It was again asserted in submissions that the opinion of Dr Haddad, Dr Freeman and Dr Fry were “based on an incomplete work history” and were thus “contrary to the Makita principles”. It was also argued that “there was no evidence against [either the appellant or the second respondent]” [62].

16. These grounds were rejected. It was self-evident that, in the absence of expert opinion inculpating employment by the second respondent, the mere history of “driving”, in that employment, could not be treated as relevant employment [65].

Ground seven

17. This ground alleged error on the part of the Arbitrator in ordering that the appellant pay Mr Watson’s costs. The Arbitrator’s decision concerning costs was one made in the exercise of discretion granted by the Commission by s 341 of the 1998 Act, as it stood before the recent amendments affected by the passage of the Workers Compensation Legislation Amendment Act 2012. This ground was not made out [66]-[67].

Ground eight

18. This ground suggested error on the part of the Arbitrator in making an order that the appellant pay the costs of the second respondent. A court or tribunal is reluctant to disturb any order made at first instance upon the exercise of discretion (House v The King [1936] HCA 40; 55 CLR 499 at 504–505) [68]-[69]. This ground was rejecte.

(a) that the respondent worker did not properly provide notice prior to the filing of the ARD, or alternatively within the ARD filed under Matter no 6897/2012 of her injury and claim for compensation;

(b) that the respondent worker’s evidence did not crystallise the claim for compensation now in dispute prior to 28 June 2012;

(c) the Arbitrator has considered that the notice of the respondent’s claim was constituted by the ARD filed in Matter no 3329/2012 was a valid notice of the respondent worker’s claim for permanent impairment where there was ambiguity in this notice of claim;

(d) that there cannot be substantial compliance with ss 281 and 282 of the 1987 Act where there is ambiguity about the assessment of the relief claimed, and

(e) that in so finding that notice of claim was constituted by an ambiguous document, the appellant was denied procedural fairness in properly determining the issues in dispute also raised in its Reply.

Held: Application to extend time to appeal refused

1. The appellant’s submissions concerning the reasons for the appeal being filed out of time did not demonstrate exceptional circumstances. Aside from providing a chronology of events, no attempt was made to explain the reason for the appeal not being filed within time. Judge Keating inferred from the chronology that the time taken to obtain the transcript of the Arbitrator’s reasons was a factor in the appeal being lodged out of time. That did not constitute exceptional circumstances [34].

2. Practitioners at judgment should be ready and active in taking notes: Dillon v Boland; Dillon v Cush [2012] NSWCA 364 at [8] applying Kounnas v Citywide Civil Engineering Pty Ltd [2012] NSWCA 287 per Allsop P at [14]–[16]. [35]

3. The Arbitrator’s reasons were relatively brief and were delivered, extempore, in the presence of the parties’ legal representatives. The issue for determination was of narrow compass and the Arbitrator’s reasons for decision should have been readily appreciated by the parties. Further, pursuant to Practice Direction 6, parties are permitted to lodge supplementary submissions within 28 days from the date of the correspondence from the Registrar providing a copy of the transcript of the proceedings [36].

4. Further, there was no explanation for the appellant insurer’s failure to give instructions with respect to the appeal after receiving advice from their solicitors on 1 February 2013 and 8 February 2013, when instructions were given to appeal [37].

5. Ms Reyes’s submission that she was prejudiced by reason of being held out of the benefit of an award was rejected. The Arbitrator’s decision was interlocutory and did not finally determine the parties’ rights and left open to the respondent to dispute the question of injury. Ms Reyes would not be entitled to recover any compensation until those issues are argued and determined [38].

6. It was accepted that if the appeal was dismissed only because the substance of the appeal concerns an interlocutory order, the matter would then proceed on all issues. The matter would be listed for an arbitration hearing and if successful on the liability issues, a referral by the Registrar to an AMS to determine the extent of any whole person impairment suffered by the worker. At that point, after final orders are entered, the appellant would be entitled to lodge a further appeal to argue the failure to provide particulars point. Judge Keating was satisfied that it was desirable for the proper and effective determination of the dispute that that issue be determined, as the resolution of the issue may avoid the unnecessary utilisation of the Commission’s resources [46].

7. The relevant provision with respect to the requirements of making a valid claim is governed by s 260 of the 1998 Act. The substance of the appellant’s complaint is the failure to provide relevant particulars of the claim in accordance with ss 281 and 282 of the 1998 Act. That was the sole issue for determination by the Arbitrator [67].

8. The context in which claims for lump sum compensation must be particularised was succinctly summarised in Bond Industries Ltd v Borg [2007] NSWWCCPD 80 (Bond Industries) at [67] and [68] cited with approval in Walker v Roberts [2009] NSWWCCPD 66 at [40].

9. The pleadings in both the first and second Applications described the injury as being due to the cleaning duties undertaken by Ms Reyes during the course of her employment from 2001 to on or about January 2008, with a marked increase in pain on or about 6 October 2007. Both Applications describe injury to the right elbow and right wrist. Both Applications also contain a detailed description of the duties that caused the injury and how they were experienced [71].

10. The first Application attached two reports from Dr Wallace. He obtained a history that in early January 2008, Ms Reyes noted a gradual onset of numbness in the ulnar aspect of her right forearm. The first Application also included a statement from Ms Reyes which described her work duties and described the onset of symptoms in October 2007, which is consistent with the pleadings in both Applications [72].

11. Proceedings in any matter before the Commission are to be conducted with as little formality and technicality as the proper consideration of the matter permits: s 354(1) of the 1998 Act. The Commission is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms: s 354(3) of the 1998 Act. The Commission is not bound by strict pleadings: Far West Area Health Service v Radford [2003] NSWWCCPD 10 approved in Shoalhaven City Council v Schutz [2012] NSWWCCPD 14 [73].

12. It was not correct that the claim in respect of the impairment of the right elbow had not crystallised until 28 June 2012. Dr Wallace assessed a permanent impairment of the right upper limb of eight per cent on 8 January 2011. A copy of that report was provided to the appellant shortly after that assessment was made. The claim was rejected not because the impairment had not crystallised, but because the worker had been previously compensated for injuries to the right arm and shoulder [74].

13. It cannot be disputed that the worker made a claim by her letter of demand on 22 June 2011 and in the first Application for lump sum compensation under s 66 of the 1987 Act. The claim was in substance a claim for compensation for whole person impairment arising from injuries to the right arm due to the cleaning duties as described by Ms Reyes [75].

14. The Arbitrator correctly determined that the particulars provided in the first Application complied with s 282 of the 1998 Act. The first Application identified the injury received to the right elbow and the circumstances in which the injury was sustained. The impairment to the right elbow was assessed by Dr Wallace in his report of 8 January 2011, which was attached to the first Application.  Dr Wallace considered but excluded the need to apportion any part of the impairment to any previous injury, condition or abnormality. The first Application and the supporting material comfortably satisfied the requirement of s 282, as to the provision of relevant particulars [76].

15. Further, the notice of claim and the particulars provided on 22 June 2011, which attached a copy of Dr Wallace’s report, also satisfied the requirements of s 282 [77].

16. Judge Keating did not accept the appellant’s submissions to the contrary, as it would have resulted in the worker being denied any compensation for the impairment claimed. This is because, on the appellant’s submission, the relevant particulars of her claim were not provided before the amendments to the lump sum compensation provisions introduced by the 2012 amending Act [78].

17. Clause 15 of Pt 19H of Sch 6 (introduced by the 2012 amending Act) provides that an amendment “made by Sch 2 to the 2012 amending Act extends to a claim for compensation made on or after 19 June 2012, but not to such a claim made before that date”. To accept the appellant’s submission would be to read cl 15 as extending the word “claim” to include “relevant particulars about a claim”. That extension was neither justified by the context of the clause nor by a fair reading of the words used. As noted earlier, the making of a claim is dealt with in ss 260 and 261. Section 282 merely deals with the provision of particulars about a claim [79].

18. The appellant’s submission that it was denied procedural fairness was untenable. In terms of the quantum of the claim, the reason for the change in the amount claimed was because the worker elected not to pursue her claim for impairment to the right wrist. That amendment did not cause the appellant any prejudice. The purpose of the provision of particulars is to enable an employer the opportunity to either accept liability and make a reasonable offer, or dispute liability: Bond Industries [80].

19. The extent of the impairment will be assessed by an AMS following referral by the Registrar: s 65 of the 1987 Act. The assessment will be made by an AMS in accordance with Ch 7 Pt 7 of the 1998 Act. In undertaking that process, the AMS may have regard to the quantum of any impairment as assessed by independent medical assessors for both parties but is not bound by such assessments [81].

(a) allowing the respondent to place in dispute the matters raised in the Reply at the Arbitration hearing;

(b) granting the respondent leave pursuant to s 289A(4) of the 1998 Act, and

(c) finding any delay in making the claim was not due to ignorance, mistake or other reasonable cause pursuant to s 261(4) of the 1998 Act.

The submissions which were put in support of those grounds suggested that ground one was intended as an assertion that no leave to raise the defences had been granted and that, when permitting those matters raised in the Reply to be litigated, the Arbitrator had erred. The second ground was advanced upon an assumption that, on appeal, the Commission was satisfied that the Arbitrator had in fact granted leave pursuant to s 289A(4). It was noted by the Deputy President that, ground two could be pursued, contrary to that which seemed to be argued, without leave being granted pursuant to s 352(3A) of the 1998 Act (see Patrick Operations Pty Limited v Watson [2013] NSWWCCPD 18 (at [50])).

Held: The Arbitrator’s determination confirmed

Fresh or additional evidence

1. Mr Mezrani sought to rely upon his passport indicating a period of absence from the country, the statements of Ms Jackie Mezrani, Ms Annette Mezrani and Mr Jason Farah (Mr Mezrani’s solicitor) as new evidence [27], [37], [43].

2. In the statement of Mr Farah, reference was made to Mr Farah’s submissions before the Arbitrator at the teleconference, that the failure to serve the s 74 notice created an estoppel that prevented the respondent from raising the issues found in the Reply [45]. That portion of Mr Farah’s statement was accepted on appeal as a submission put concerning the merits of the appeal generally [51].

Availability of evidence 

3. Mr Mezrani failed to adequately establish that the evidence he sought leave to admit was not available and could not have been reasonably obtained before the proceedings before the Arbitrator: s 352(6) of the 1998 Act [28], [39]-[40], [42]. [44].

Would failure to grant leave cause substantial injustice?

4. There was no suggestion made in submissions that delay in making the claim was shown by the fresh evidence to have been occasioned by mistake. Nor was there any argument advanced, founded upon that material, which identified any other reasonable cause for such delay. It was held that failure to grant leave to adduce the fresh evidence would not cause substantial injustice in this matter. The application to adduce the evidentiary material was refused [59].

The merits of the appeal

Ground one

5. In so far as Mr Mezrani asserted that the Arbitrator did not grant leave to the respondent to rely upon the defences raised in the Reply, such assertion was rejected. The Commission’s file relating to this claim contained two documents which constituted a record of what transpired at the teleconference [61]. Those documents made clear that leave had been granted by the Arbitrator pursuant to s 289A(4) of the 1998 Act permitting the matters of dispute raised in the Reply to be agitated at the hearing of the dispute. This ground was rejected [63].

Ground two

6. The respondent had not provided a notice concerning matters in dispute as required by the provisions of s 74 of the 1998 Act. It was noted that the absence of such a notice, of itself, did not negate the respondent’s entitlement, in appropriate circumstances, to a grant of leave to rely on defences particularised in the Reply [65].

7. No argument was advanced before the Arbitrator that there had been a denial of natural justice or procedural fairness concerning the manner in which the Arbitrator considered the respondent’s application seeking leave. Given the manner in which Mr Mezrani conducted his case before the Arbitrator it was not open to him to seek to challenge on this appeal the leave granted by the Arbitrator [66].

8. Mr Mezrani’s submissions included an assertion concerning an “impression” in his mind and that of his solicitors “that leave still had not been granted”. That apparent misunderstanding, if that had been the circumstance, was not raised by counsel when the subject was raised at the hearing and therefore it was not open to Mr Mezrani to argue on appeal that it lead to prejudice. Ground two was not made out [67].

Ground three

9. It was put in submissions that Mr Mezrani relied on the new evidence as providing an explanation “for the delay in making of the claim”. Having regard to the earlier ruling concerning the admissibility of that fresh evidence, any argument raised on appeal which was founded upon that material was necessarily disregarded [68].

10. The Arbitrator’s conclusion that Mr Mezrani had failed to discharge the burden of proof concerning those matters which may excuse non-compliance with the notice requirements was open to her on the evidence presented at the hearing. It was noted that the reasoning of the Arbitrator as expressed led to a result concerning the operation of s 261 which would have been no different had the fresh evidence been before her. Ground three was not made out [70].

1. The fundamental problem with the claim was that it was based on the incorrect conclusion by Dr Conrad, general surgeon, that overuse of the left arm had caused a rotator cuff tendinitis and pericapsulitis. In light of the MRI findings, and the opinions from Dr Duckworth, shoulder and elbow surgeon, and Dr Breit, orthopaedic surgeon, medical experts who specialise in shoulder surgery, the correct diagnosis was capsulitis or frozen shoulder. The causes of that condition are not said to include overuse [32].

2. Given the expertise of Dr Duckworth and Dr Breit in shoulder conditions, not matched by Dr Conrad, and given Dr Breit’s criticism of Dr Conrad’s diagnosis, to which Dr Conrad had not responded, Dr Breit’s opinion, which was supported by the treating specialist (Dr Duckworth), was preferred [33].

3. This conclusion was reached notwithstanding that Dr Breit did not take a full history of the additional use to which Ms Posa put her left shoulder because of the pain in her right shoulder, and did not directly address the consequential loss issue. While “[a]n expert opinion is only as good as the foundation upon which it is based” (City of Brimbank v Halilovic [2000] VSCA 12 at [23]), given the doctor’s expertise, his diagnosis (supported by Dr Duckworth), and his opinion that capsulitis was constitutionally based, the lack of a history of overuse had not undermined his opinion that it should not be accepted [34].

4. Dr Breit’s report provided a “fair climate” for the acceptance of his opinion (Paric v John Holland (Constructions) Pty Ltd [1985] HCA 58; 59 ALJR 844; [1984] 2 NSWLR 505 at 509–510) and involved an unambiguous rejection of the claim [35].

5. In light of the medical evidence, the fact that Ms Posa had consistently complained that her left shoulder problems resulted from overuse of that shoulder was of limited probative value. While it is certainly possible that overuse will cause shoulder symptoms, the preferred medical evidence in this case was strongly against the conclusion that overuse had caused or contributed to Ms Posa’s capsulitis, and the claim failed [39].

6. In the absence of a report from Dr Languido, reliance on the hearsay summary of his opinion in the insurer’s s 74 notice did not advance Ms Posa’s case. Even giving full weight to that evidence (since the Commission is not bound by the rules of evidence), because of their additional experience and training, the evidence of the two shoulder specialists (Dr Breit and Dr Duckworth) was preferred to the evidence of the general practitioner (Dr Languido) [41].

7. Dr Conrad took an accurate history and explained the basis for his conclusion, which was clearly based on his expertise as a general surgeon. That was sufficient to comply with the principles in Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705 [42]. The rejection of Dr Conrad’s opinion did not depend on an alleged non-compliance with the principles in Makita, as had been argued by the appellant, but on an acceptance of Dr Breit’s diagnosis and his explanation of the cause of that diagnosis, and the acceptance of Dr Duckworth’s evidence [43].

8. The claim for lump sum compensation under the Table of Disabilities for the left arm at or above the elbow failed because the expert evidence did not support a connection between the left shoulder condition and the accepted injury to the right shoulder. Applying the principles in Kooragang, Ms Posa had not established that the condition of her left shoulder had resulted from the accepted injury to the right shoulder [45].