State of NSW (Fire & Rescue NSW) v Roberts Concrete Specialists Pty Ltd (formerly Jack Harrison Home Builders Pty Ltd) [2020] NSWWCCPD 20 (20 April 2020)

Summary

This matter involved an appeal against the decision of Arbitrator Beilby of the Workers Compensation Commission, who declined to apportion liability to pay compensation between two employers pursuant to sections 22 and 22A of the Workers Compensation Act 1987 (NSW) (‘the Act’); on the basis that it was not “just and equitable” to do so in the “absence of direct evidence from the worker” in relation to his incapacity.

This was despite:

a) A Medical Appeal Panel (“MAP”) apportionment of lump sum compensation of 80% to the respondent (first employer) and 20% to the appellant (second employer); and
b) An admission by the respondent that the worker would continue to have a disability affecting his left knee as a result of the 1970 injury.

The Appeal was successful. Interestingly however, President Judge Phillips agreed that evidence from the injured worker which specifically addressed how each injury caused and/or contributed to his incapacity, would have considerable probative value in an application for apportionment.

Facts

Mr Harrison (“the worker”) was employed by Jack Harrison Home Builders Pty Ltd (now Roberts Concrete Specialists Pty Ltd) (“the respondent”) as a labourer/carpenter.

In 1970, Mr Harrison fell from scaffolding and twisted his left knee during the course of his employment with the respondent. As a result of the injury, he suffered a torn meniscus and underwent a meniscectomy.

Mr Harrison later commenced employment with Fire & Rescue NSW (“the appellant”) as a fire fighter and on 11 January 2007 (deemed date of injury), he suffered an aggravation injury to his left knee while on duty (“the aggravation injury”). As a consequence of his injuries, Mr Harrison ultimately underwent a total left knee replacement and was medically discharged.

On 25 February 2011, the worker made a claim for lump sum compensation against the appellant’s insurer in respect of his injuries. The MAP assessed 4% WPI in relation to the aggravation injury after applying an 80% deduction on the basis of the worker’s original left knee injury in 1970.

In light of the MAP’s findings, the appellant commenced proceedings against the respondent in the WCC seeking an order for apportionment of liability to pay compensation arising out of the worker’s left knee injury pursuant to sections 22 and 22A of the Act.

On 16 May 2019 Arbitrator Beilby issued a Certificate of Determination declining the application for apportionment on the basis that it was not “just and equitable” to do so in the absence of direct evidence from Mr Harrison.

The appellant subsequently filed an Application to Appeal against Arbitrator Beilby’s decision.

Judgment on Appeal

The appellant argued that Arbitrator Beilby erred in law by declining to exercise the power to apportion liability for compensation between the appellant and the respondent under section 22 of the Act.

In determining the issue, President Judge Phillips confirmed that section 22 of the Act was only enlivened where the worker’s incapacity arose from more than one injury and that the applicant bore the onus of adducing evidence to establish this.

Further, the WCC could exercise its power to apportion liability for payments “as it sees fit in circumstances where the evidence indicated the workers incapacity resulted from more than one injury”, and where it was “just and equitable” to do so.

President Judge Phillips held that Arbitrator Beilby erred in law by refusing to exercise the power of the WCC to apportion payments made by the appellant on the basis that it would not be “just and equitable” under section 22A(1)(a), even in the absence of evidence from Mr Harrison.

It was further stated that it was an error to use the “just and equitable” test as a basis for the declinature before first determining whether the worker’s incapacity resulted from more than one injury under section 22 of the Act.

While the President acknowledged that evidence from the worker was an important factor in determining the issue, the Arbitrator at first instance failed to take into account or give sufficient weight to the available evidence which dealt with the worker’s incapacity.

The original Certificate of Determination was revoked and the matter was remitted for re-determination by another Arbitrator.

Implications 

The decision takes a deep dive look into the test for apportionment and unpacks the web of multi-staged tests and inquiries that must be considered.

Most notably, it offers practical guidance to insurers seeking a section 22 apportionment by stressing the importance of adducing direct evidence from the worker in respect of their incapacity, and what they felt to be the significant cause of the incapacity. Whilst this question is usually one for medical determination by independent medical experts, it is clear that lay evidence from the worker should also be obtained.

As such, in cases where a section 22 apportionment may be open for an insurer/employer, care should be taken to obtain a detailed statement from the worker, which specifically addresses their incapacity for work and how they felt each injury caused/contributed to that incapacity.