Tim's take on Tan

The New South Wales legal and workers compensation insurance industries have been surprised by the Court of Appeal Decision in Tan v National Australia Bank Ltd [2008] NSWCA 198.

The Decision raises significant issues in relation to the obligations of workers to properly submit claims prior to referral of disputes to the Workers Compensation Commission, in relation to the jurisdiction of the Commission, and in relation to procedure before the Commission in terms of adjournment of proceedings to allow procedural fairness.

Our Special Counsel, Tim Wardell, has prepared a commentary on the Judgment for the benefit of our readers. Click here to access. Tim concludes:

“This decision signals a significant departure from the current model for the resolution of claims and disputes. In particular, it challenges the notion that the claim must be made with particularity in order that the parameters of a dispute raised by an insurer can be narrowed, the concept of a ‘front end loaded’ system in which all evidence and the claim to which it relates is clearly identified prior to referral to the WCC, and the WCC’s entrenched practice of refusing adjournments to enable the gathering and admission of further evidence. Most significantly, it creates uncertainty for insurers regarding the claims they are expected to determine and meet, particularly having regard to the limits on what issues can be raised and what evidence can be relied upon in WCC proceedings. The former may be covered by s.289A(4) which grants a discretion to allow issues not previously notified as disputed by insurers to be raised, but creates real difficulties by reason of s.73, which precludes an insurer from relying in WCC proceedings on material not previously provided to the worker under a Dispute Notice or an offer of settlement. This problem could only be resolved by proceedings being adjourned in order to allow an insurer to issue a further Dispute Notice, although the time limits for the determination of claims could prove problematic in this regard.”

Tim also considers that there are real concerns in relation to the correctness of the decision and identifies grounds for appeal.

Update on Dispute Notices

Scheme agents are now well aware of the perils of failure to properly prepare Dispute Notices:

  • Issues cannot be raised unless they are properly identified in a Notice.
  • Documents in the possession of an employer or scheme agent, and which are relevant to the decision to dispute liability, are inadmissible unless attached to a Notice.

The danger of not complying with the Notice provisions was highlighted in Irene Manning v The Office of the Public Guardian WCC 006335/2007. This was a difficult claim brought by the dependants of a deceased worker, alleging death as a result of meningococcal meningitis and septicaemia. The dependants relied solely on statistical evidence, with no direct evidence of exposure, whereas the employer had expert evidence in support of its position that employment was not causative.

The Arbitrator decided that as the Dispute Notice was only served eight days prior to the Arbitration, the Dispute Notice and all the employer’s evidence was inadmissible.

This resulted in an Award of $285,750.00, in addition to ongoing weekly payments for the dependents.

We are often asked to advise in relation to the degree of particularity required in order for Notices to be accepted as complying with the legislation. A few helpful rules are:

  • An employer is not expected to spell out every argument that will be raised, as this would be impractical:Seaib v Hayes Personnel Services (Aust) Pty Ltd [2008] NSW WCC PD 36.
  • A worker cannot be expected to ascertain the issues from annexures to the Notice. The Notice itself must state the reasons liability is disputed and the reasons for the decision, however it is then acceptable to expect that the nature of the issue can be defined with more particularity by reference to the attachments: Seaib.
  • No particular form of words is needed, provided the Notice conveys the required information to the ordinary reader: B W Esler Services Pty Ltd v Dulhunty [2000] NSWCA 349.

We are also frequently asked to advise as to the correct approach when there is conflict between the legislation and the Workcover Guides for Claiming Compensation Benefits in relation to the content of Dispute Notices. For example, the legislation requires a statement of the reason liability is disputed and the issues relevant to the decision,whereas the Guides also require a statement of matters in dispute.

The answer to this question is that the Guides are for the assistance of insurers, but that they do not affect the proper construction of the legislation: Fletcher International Exports Pty Ltd v Barrow [2007] NSWCA 244.

Court of Appeal Adds Spice to Debate on Arbitrator or AMS Supremacy

The arm-wrestle on whether Approved Medical Specialists are bound by findings of arbitrators in relation to impairment continues.

The situation appeared to be settled after the Decisions in Merza v Spicer Axle Australia Pty Ltd (2006) NSWSC 939 and Spicer Axle Australia Pty Ltd v Merza (2007) NSW WCC PD 148, which determined that the making of precise findings as to the nature of pathology resulting from an injury falls within the exclusive jurisdiction vested in arbitrators of the Commission by operation of s.105 of the 1998 Act.

However, in Haroun v Rail Corporation New South Wales & Ors [2008] NSWCA 192 the Court of Appeal rejected the proposition that an AMS was bound by the finding of an arbitrator that the effects of injury continued to contribute to impairment. Handley JA concluded that “A MAC which is conclusively presumed to be correct under s.326(1) trumps any inconsistent findings by an Arbitrator and such findings are neither final nor binding on the parties”.

This Decision related to an application for leave to appeal out of time, and therefore only required limited consideration. It remains to be seen whether the Decision will withstand more detailed scrutiny.

For More Information

Please contact us should you have any queries regarding the above.