FEDERAL COURT OF AUSTRALIA Nikolovski v Telstra Corporation Ltd [2002] FCA 846 ADMINISTRATIVE LAW – application for review of a decision of the Administrative Appeals Tribunal – where the Tribunal affirmed five decisions made pursuant to the Safety Rehabilitation and Compensation Act 1988 (Cth) – whether the Tribunal failed to set out its findings on material questions of fact and to refer to evidence or other materials on which those findings were based – where the Tribunal's reasons contained no direct or discrete discussion of one of the decisions under appeal – whether the matter should be remitted for rehearing to the Tribunal differently constituted or to the same Tribunal. Administrative Appeals Tribunal Act 1975 (Cth) s 43(2B) Safety Rehabilitation and Compensation Act 1988 (Cth) Brackenreg v Comcare Australia (1995) FCR 335 referred to Carroll v Australian Jockey Club (1999) 19 NSWCCR 164 referred to Comcare Australia v Hill (1999) 56 ALD 487 referred to Industry Research and Development Board v IMT Ltd (2001) 46 ATR 275 referred to NIKOLOVSKI v TELSTRA CORPORATION LTD N 1553 of 2001 MOORE J 5 JULY 2002 SYDNEY IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 1553 OF 2001 ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL BETWEEN: CANE NIKOLOVSKI APPLICANT AND: TELSTRA CORPORATION LTD RESPONDENT JUDGE: MOORE J DATE OF ORDER: 5 JULY 2002 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The decision of the Administrative Appeals Tribunal in matter N 2000/1929 to affirm the decision dated 19 December 2000 that affirmed a determination dated 29 September 2000 be set aside. 2. The Tribunal, differently constituted, rehear the application for review concerning the decision referred to in order 1. 3. The appeal otherwise be dismissed. 4. The respondent pay the applicant's costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY N 1553 OF 2001 ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL BETWEEN: CANE NIKOLOVSKI APPLICANT AND: TELSTRA CORPORATION LTD RESPONDENT JUDGE: MOORE J DATE: 5 JULY 2002 PLACE: SYDNEY REASONS FOR JUDGMENT Introduction 1 This is an appeal by Mr Cane Nikolovski ("the applicant") from a decision of the Administrative Appeals Tribunal ("the Tribunal") dated 25 October 2001 made pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth) ("the Act"). In its decision the Tribunal affirmed five decisions made pursuant to the Safety Rehabilitation and Compensation Act 1988 (Cth) ("the Compensation Act"). 2 The decisions which were the subject of the appeal to the Tribunal were described in its reasons: "(i) Matter N2000/1097 which sought review of a 'reviewable decision' dated 3 July 2000 which affirmed a prior decision dated 28 March 2000 that the Applicant was not entitled to any award for permanent impairment caused by the condition described as 'recurrence of thoraco lumbar strain'. (ii) Matter N2000/1701 which sought review of a 'reviewable decision' dated 24 October 2000 which decision affirmed a prior determination dated 1 June 2000 that the Applicant was not entitled to treatment being remedial massage which treatment was sought for the Applicant's thoracic and lumbar spinal pain. (iii) Matter N2000/1702 seeking review of a 'reviewable decision' dated 24 October 2000 affirming a prior determination dated 4 July 2000 that rejected the Applicant's claim for compensation pursuant to the Safety Rehabilitation and Compensation Act 1988 for the condition described as 'depression as a consequence of thoracic and lumbar spinal pain'. (iv) Matter N2000/1929 seeking review of a 'reviewable decision' dated 19 December 2000 that affirmed a prior determination dated 29 September 2000 ceasing liability to pay compensation for the condition described as 'thoracic and lumbar spine pain'. (v) Matter N2001/80 seeking review of a 'reviewable decision' dated 11 January 2001 which decision affirmed a prior determination of 29 December 2000 that rejected a claim for compensation pursuant to the Safety Rehabilitation and Compensation Act 1988 for permanent impairment resulting from 'back, left leg and depression'." Background 3 The following is a summary of the applicant's circumstances as found in the reasons for decision of the Tribunal ("the Tribunal's reasons"). In June 1995 the applicant, during the course of his employment with Telstra Corporation Ltd ("the respondent"), suffered injuries in a motor vehicle accident. Liability was accepted for the injuries sustained by the applicant, who required treatment and a short period of absence from work. Following this absence the applicant was able to resume full duties. 4 On 10 March 1998 the applicant injured his back while lifting a block of concrete during the course of his employment with the respondent. He received medical treatment from his general practitioner but continued to carry out his normal duties. He did, however, continue to experience discomfort. Some months later, in October 1998, the applicant had another accident at work in which he again suffered injury to his back. On this occasion the treatment prescribed by his general practitioner was physiotherapy and acupuncture. 5 The applicant commenced five weeks annual leave in December 1998 and did not resume work until 19 January 1999. As he was continuing to experience back pain and was unable to perform the full range of his normal duties, he was removed from field work and placed on light duties in the respondent's Ashfield office, commencing in February 1999. A return to work program was implemented requiring the applicant to build up his work hours from five to eight hours per day. Because he was removed from field work, the applicant had to surrender a company vehicle. This led to a dispute between the applicant and management. 6 After commencing light duties in the Ashfield office, the applicant had to apply for the position as a permanent position. He was unsuccessful and was advised that he did not present well at interview. Some time later he sought an interview with his Regional General Manager to ascertain his future prospects with the respondent. This, too, was unsuccessful, the applicant giving evidence that the Regional General Manager's response had been: "What do you want me to do about it?" The net effect of these events was that the applicant became depressed and fearful of losing his employment. By late 1999 this had worsened to the point where he was unable to communicate and confined himself to his home. In January 2000 he was certified unfit for work for reasons of "back pain and depression." 7 On 17 July 2000 Ms Carina Vitelli, a rehabilitation consultant employed by the respondent, contacted the applicant's general practitioner, Dr Gill. In response to her enquiry regarding the applicant's ability to "return to work to perform suitable duties with restrictions", he replied that physically he could but mentally he could not. He added: "[The applicant] doesn't want to go back to Telstra because of poor treatment by managers and staff". 8 The applicant's manager, Mr Ivanovski, wrote to the applicant again on 16 August 2000 to advise him of a return to work program. In that letter it was requested that the applicant meet with his manager and Ms Vitelli to discuss his situation and the possibility of establishing a rehabilitation program for him. The applicant's response was that he would not attend a meeting until he had discussed the matter with his solicitor. By a letter dated 4 October 2000, the applicant was invited to show cause why his employment should not be terminated on the basis of medical capacity. His failure to show cause resulted in the termination of his employment on 22 November 2000. In the letter of 4 October 2000 it was noted that the applicant had declined an offer of continued support and rehabilitation. The Tribunal's findings 9 In its reasons for decision the Tribunal accepted that the applicant had suffered injury to his back from two workplace accidents in 1998. In relation to the motor vehicle accident in 1995 it held that on the applicant's own evidence and that of Dr Berry (a specialist general surgeon), Dr Thomson (an orthopaedic surgeon) and Dr Carr (a rheumatologist), there were no consequential ongoing problems. 10 On the question of the degree of impairment suffered by the applicant as a result of the workplace injury to his back, the Tribunal said: "(W)e are satisfied that no physical condition other than pain to the thoracic spine is compensable. There is evidence referred to above that the Applicant recovered from any disabilities occasioned by the motor vehicle accident and his leg condition has not been attributed to any work injury. In any event any incapacity caused by the Applicant's left leg is intermittent. Dr Browne notes that there is no assessable impairment that can apply to his lower limbs. The Applicant has complained of various neck and shoulder pain but there is no evidence that sufficiently links this with any work injuries." The Tribunal then summarised the conclusions of the doctors consulted by the applicant, which it set out as follows: "Dr Browne considers the Applicant has a 10% impairment of the spine. Dr Carr does consider the condition permanent but does not state a degree of impairment. Dr Manohar opined that the Applicant suffered a 10% impairment being a combination of the neck and the back. As stated the Applicant has no entitlement to compensation for any neck condition. Dr Berry regards the Applicant as having a loss of half normal range of movement and thus a 15% impairment of the back and attributes a 10% impairment to the left leg. Dr Thomson does not consider the Applicant's impairment to be permanent. We find that the Applicant has a tendency to exaggerate his symptoms. Dr Dowda in May 1999 noted the Applicant's range of movement was good. Flexion allowed his fingertips to reach just below his knees, extension, tilting and rotating were all normal. Dr Dowda referred to the Applicant having avoidance behaviour leading to deconditioning. Dr Manohar also refers to the Applicant's need to undertake management. Doing the best we can from the material before us we conclude that the Applicant does have a permanent impairment but we are not satisfied that the degree of permanent impairment is 10%." 11 The Tribunal also rejected the applicant's claim for compensation in respect of a psychiatric condition. It stated: "He does have feelings of anger and resentment towards Telstra but again we believe he has exaggerated his symptoms. … Dr Whetton saw the Applicant for the purposes of treatment and we therefore give some weight to his opinions. What we found particularly relevant was that the Applicant rebuffed Dr Whetton when that doctor tried to encourage him to undertake rehabilitation. This was at the same time that the Applicant was rejecting overtures from the Respondent to return to work. As Dr Whetton said in his report to the Applicant's General Practitioner and was confirmed by the Applicant, he had made up his mind not to return to Telstra. Dr Lewin in our opinion correctly summarised the Applicant when he said whilst the Applicant may have experienced an adjustment disorder at an earlier stage when he examined him he could not diagnose any current psychiatric illness. Compare Dr Samuel [sic] who also referred to the Applicant not suffering from any psychiatric illness but being off work as a matter of grievance and indignation at the perception of being 'ill treated'. This perception has manifested itself, as pointed out by Dr Whetton in his report of 10 August 2000, to an unrealistic stance by the Applicant. We find that Dr Whetton's report supports the conclusions of Drs Lewin and Samuel [sic] and are satisfied that the Applicant does not have a psychiatric illness caused by or contributed to by the circumstances of his employment." 12 Turning next to the claim for treatment in the form of remedial massage, the Tribunal accepted the opinions of Dr Carr and Dr Thomson who did not consider it to be beneficial for the applicant to continue to receive massage therapy. The Tribunal added: "As pointed out by Dr Dowda a focused exercise program, or a pain management program as suggested by Dr Manohar, would be of advantage to the Applicant." 13 The Tribunal concluded by affirming the decisions under review. This plainly involved the Tribunal confirming each of the five decisions it had been called on to review. However nowhere in the Tribunal's reasons is there a direct or discrete discussion of the issues attending decision (iv) set out at [2] above. This leads to a consideration of the issues raised by the applicant in these proceedings. Issues raised by the applicant and their resolution 14 While the notice of appeal contained several grounds, I understood counsel for the applicant to accept that only one substantive ground was raised and the other grounds were effectively defensive in character. That is, the issues raised by the other grounds were in anticipation of submissions the respondent might make concerning the substantive ground. It is appropriate, in the circumstances, to address only the substantive ground at least initially. 15 As noted at the outset of these reasons, the Tribunal was called upon to review five decisions. The fourth decision (in the list set out at the beginning of these reasons) was a decision of 19 December 2000 affirming a determination of 29 September 2000. The determination (Determination T9802775) was a determination under s 19 of the Compensation Act. The determination was of a senior claims officer of GIO Australia. He determined that the respondent "is no longer liable to pay compensation to the [applicant] in respect of incapacity payments on and from 29 September 2000". In a statement of reasons published by the senior claims officer, it was noted that the applicant had an ongoing claim for compensation in respect of "thoracic and lumbar spine pain" sustained on 26 October 1998. This was plainly a reference to the work-related injury suffered by the applicant in October 1998. The senior claims officer also noted that Dr Gill, the applicant's treating general practitioner, had expressed an opinion on 30 August 2000 that the applicant was physically fit to return to work but not mentally fit. He also noted that a determination had been made on 4 July 2000 that any mental condition suffered by the applicant was unrelated to the spinal injury or his employment with the respondent. The applicant's application to the Tribunal, in relation to this determination, raised for consideration whether these conclusions were correct and whether the determination ultimately made should have been made. 16 Counsel for the respondent was unable to point to any passages in the Tribunal's reasons where these issues were discussed. All that was pointed to was a paragraph in which, effectively, the Tribunal concluded that the applicant's employment was terminated because he declined an offer of a return to work program. While the Tribunal did consider the complaints of the applicant concerning his lumbar and thoracic spine, it was in the context of considering whether the applicant's suffered from a compensable permanent impairment. The Tribunal did accept that the applicant suffered a degree of permanent impairment but indicated it did not accept that the degree of permanent impairment was 10%. Under the Compensation Act, this conclusion meant the applicant was not entitled to payment for any permanent impairment. However what the Tribunal did not discuss was whether the applicant was incapacitated (in the sense of incapacitated for work) by that injury. That was the issue raised by the application for review of decision (iv). 17 While it is necessary to read the Tribunal's reasons benevolently and not with an eye to discerning error, the Tribunal has failed, in my opinion, to expose its reasons for affirming the decision in question. That is, the Tribunal has not explained in its reasons why it effectively affirmed the decision of 29 September 2000 discussed earlier. The Tribunal is obliged by s 43(2B) of the Act to set out its findings on material questions of fact and refer to the evidence or other material on which those findings were based. In his written submissions in these proceedings, counsel for the applicant set out, at some length, evidence which he submitted was relevant to the question of whether the applicant was incapacitated after 29 September 2000 because of the back injury he had earlier sustained. Indeed counsel for the applicant submitted that the evidence was supportive of the view that the applicant was incapacitated after that date. It included the evidence of Dr Thomson, Dr Berry and Dr Carr. It may be accepted that the views of these doctors were referred to by the Tribunal in the context of considering whether the applicant suffered permanent impairment. 18 However no findings were made about whether, on this or other evidence, the applicant was incapacitated after 29 September 2000. The closest, in my opinion, the Tribunal comes to addressing the issue, is first, a passage in its reasons where it indicated that it could not accept that the applicant was in continuous pain at a scaled level of 8 from a minor back injury (where, in the scale, 1 is the least severe and 10 is the most severe pain) yet he was taking no analgesia for the pain and secondly, where the Tribunal indicated that it considered the applicant had a tendency to exaggerate his symptoms. However no findings were made about the medical evidence more generally and whether it either justified or did not justify a conclusion that the applicant was incapacitated from 29 September 2000. It was necessary for the Tribunal to make these findings and refer to the evidence if, as it did, it was to affirm the determination made on 29 September 2000 that the applicant was not suffering a compensable incapacity. It did not do so and has erred in law: see eg Brackenreg v Comcare Australia (1995) FCR 335. It is probably fair to say that counsel for the respondent did not really seek to demonstrate that such findings had been made nor that the evidence was relevantly referred to in the Tribunal's reasons. 19 This leads to a consideration of what orders should be made having regard to the established error. Counsel for the applicant submitted, as I understood his submission as it was finally put, that the relevant Tribunal decision (affirming decision (iv)) should be set aside and the matter remitted to the Tribunal on the basis that it would be heard and determined by the Tribunal differently constituted. Counsel for the applicant had also submitted that all the decisions of the Tribunal should be set aside. This, in my opinion, is an untenable position as no error has been demonstrated in relation to the Tribunal's consideration of the other decisions ((i), (ii), (iii) and (v)) and the conclusions reached in relation to them is not dependent on any conclusion reached in relation to decision (iv). Counsel for the respondent submitted that any order remitting the matter should not require that the Tribunal differently constituted hear the matter. That latter submission was made on the basis that the Tribunal members who originally considered the application of the applicant, would be familiar with the facts and their earlier decisions concerning decisions (i), (ii), (iii) and (v). Reference was made to the judgment of Walker J in the Compensation Court of New South Wales in Carroll v Australian Jockey Club (1999) 19 NSWCCR 164 concerning whether a judge should continue to hear a matter after error was corrected on appeal. 20 The principles in this Court are comparatively well settled concerning whether the Court should order that a remitted matter should be heard by the Tribunal differently constituted. Many of the relevant authorities have been referred to in the recent decisions of Spender J in Comcare Australia v Hill (1999) 56 ALD 487; [1999] FCA 488 and R D Nicholson J in Industry Research and Development Board v IMT Ltd (2001) 46 ATR 275; [2001] FCA 85. Spender J was considering a situation where the Tribunal had erroneously ruled Comcare was not entitled to contest the "work connectedness" in a case concerning issues under the Compensation Act. The parties agreed the Tribunal had erred. His Honour considered that it was not appropriate to require the Tribunal differently constituted to rehear the matter and it would not be wrong or improper for the Tribunal constituted in the same way to hear the matter as this would result in savings in time and costs. However, his Honour noted that no issue of credit had been raised before or determined by the Tribunal. His Honour also referred to the judgment of Sheppard J in Brackenreg v Comcare Australia (1995) 56 FCR 335 at 343 - 352. In Brackenreg Sheppard J remitted a matter to the Tribunal for rehearing before a different member in circumstances where the Tribunal had failed to give adequate reasons. 21 In the present matter the Tribunal expressed views about the credit of the applicant. It said that the applicant had a tendency to exaggerate his symptoms and this observation was made in the context of considering whether he suffered a permanent impairment arising from his injury to his back. It is highly likely that this view would have a bearing on the question of whether the applicant was incapacitated after 29 September 2000 as a result of the same back injury. Accordingly I think, in the circumstances, it is appropriate that the Tribunal differently constituted rehear the applicant's application insofar as it sought to impugn decision (iv). By adopting this course, I would hope to avoid allegations of prejudgment though I do not intend to suggest, of course, that the members of the Tribunal who heard this matter initially would not perform their tasks diligently and honestly if the matter were remitted to them. However I consider, on balance, the matter should be heard by the Tribunal differently constituted. I certify that the preceding twenty one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. Associate: Dated: 5 July 2002 Counsel for the Applicant: Leo Grey Solicitor for the Applicant: Carroll & O'Dea Counsel for the Respondent: Nick Polin Solicitor for the Respondent: Henry Davis York Date of Hearing: 7 June 2002 Date of Judgment: 5 July 2002