ATLAS v BULLI SPINNERS PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL KirBy P, MAHONEY and CLARKE JJA 7 July 1993, 5 August 1993 [1993] NSWCA 8 WORKERS' COMPENSATION — partial incapacity — notional total incapacity — award entered in favour of worker — subsequent application for review of award — reviewing judge finds continuing partial incapacity — declines to award payment of weekly compensation in accordance with s11(2) of the Workers' Compensation Act 1926 — no evidence given by the worker in the review application — no direct evidence that worker not ready, willing and able to undertake selected duties — worker asserts by her pleading such readiness — no evidence offered that employer has provided such work to the worker or made such work available since earlier award — choice of applicable statutory regime — whether primary judge failed to provide reasons for terminating benefits under s11(2) of the Act — held: WORDS and PHRASES — "employer shall provide". (1) By Schedule 6 Pt4 para5 of the Workers Compensation Act 1987, upon review of the earlier award being conducted, the rights of the worker to weekly compensation were to be determined, relevantly, under s11(2) of the Workers' Compensation Act 1926 and not s38 of the Workers Compensation Act 1987; (2) The onus of establishing an entitlement to review and of discharge of the duties imposed by s11(2) of the 1926 Act rested upon the employer and not the worker; RJ Brodie (Holdings) Pty Ltd v Pennell (1969) 117 CLR 665 applied; (3) The duty of the employer to provide suitable work to an injured worker during partial incapacity was a continuing one. Electric Power Transmissions Pty Ltd v D'Urso (1970) 124 CLR 338 applied; (4) There was no positive evidence nor any inference available to the judge by which she could have concluded that the employer had provided such suitable work or that it was exempted from doing so because the worker was not ready, willing and able to accept suitable work if provided. George Weston Foods Ltd T/as Tip Top Bakeries v Rantino, Court of Appeal, unreported, 8 August 1991, (1991) NSWJB 67; and Kogarah Golf Club Ltd v Sullivan and Anor, Court of Appeal, unreported, 23 April 1993 (1993) NSWJB 43 applied; (5) The trial judge failed to provide reasons for the termination of weekly compensation befits under s11(2) of the Act to the worker. Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 (CA) applied; (6) Accordingly, the proceedings must be returned for retrial to the Compensation Court. Workers' Compensation Act 1926, s11(2), and s60. Workers Compensation Act 1987, s38, s281, s282, Schedule 6. Kirby P This appeal concerns a challenge to an award of the Compensation Courtof New South Wales (O'Toole CCJ). Involved in the appeal is the application of s11(2) of the Workers' Compensation Act 1926 where a judge has concluded that a "change of circumstances" has been established such as to authorise review by the Compensation Court of an award earlier made by it under that subsection in favour of a worker. Injury, earlier award and application for review 2 UNREPORTED JUDGMENTS Mrs Sukriye Atlas (the worker) was employed by Bulli Spinners Pty Ltd (the employer) in May 1982. Whilst on a night shift in the course of her employment she manipulated the handle of a machine exerting considerable strength in doing so. This caused her to feel sudden low back pain. She claimed, and was paid, compensation under the 1926 Act until January 1984. Compensation payments were then terminated. She brought an application for compensation which was heard by Freeman CCJ and determined on 19 November 1984. His Honour found that the worker had suffered injury to her lumbar spine in the circumstances described. He determined that she was totally incapacitated during the period for which she had been paid compensation benefits. Thereafter, he found that she was partially incapacitated for work, being probably fit for work which did not require heavy lifting or repetitive bending. He found that she was not able to earn more than $200 per week during her partial incapacity. He also found that on 5 March 1984 the worker had approached the employer "with the necessary [as I find] willingness to perform suitable employment". The worker, having been 'rebuffed' on this approach, Freeman CCJ decided that the worker was entitled to an award of compensation under s11(2) of the 1926 Act "from that day onwards". Thereafter, the employer paid compensation, in the terms of the award, for a period of six years. On 2 November 1989 an application was lodged by the employer in the Compensation Court. It sought a review of the weekly payments awarded to the worker under the Act. The particulars of the application specified the grounds upon which the variation was sought as follows: "(a) The Applicant Employer has evidence in his possession which suggests that the respondent worker is fit for Work; (b) Alternatively the respondent worker is not ready and willing to engage in employment for the Applicant Employer; (c) Alternatively the respondent worker has an increased capacity for employment." The worker's Answer to the application asserted continuing incapacity, an inability to earn the amount which she would probably have earned but for the injury found and "that the respondent worker is ready, willing and able to undertake selected duties". Rather boldly the Answer claimed that, at the hearing of the application, the respondent worker intended "to give evidence of and rely upon" the foregoing "facts". The hearing of the application for review came before O'Toole CCJ on 7 June 1990. The employer called an investigator who, in July 1989, had exposed video film of certain of the worker's activities. No other oral evidence was submitted. Medical reports from Dr Peter Burke and Dr RL Thompson were tendered for the employer. A report of Dr Lewis Cremona was tendered for the worker. The worker herself, although attending court, did not give evidence. Award and reasons of the primary judge O'Toole CCJ published her reasons for the award which she entered on 13 June 1990. In the reasons, her Honour reviewed the history of the claim. She described the video film which she had watched concluding: ".. [think it would be reasonable to conclude that that person was not suffering any substantial or serious spinal disability sounding in neurological compromise. [but it showed] the female person depicted, exhibited an awkward stance, poor posture and inclination from her hips when performing particular activity... Overall my impression of the film was that the worker played a slightly more active part than [a] male person... I was also impressed by her apparent care negotiating steps on more than one occasion and gained the impression that she URJ ATLAS v BULLI SPINNERS PTY LTD (Kirby P) 3 handled less heavy objects than objects handled by other persons. Overall it seems to me that the film... is not inconsistent with the existence of some persisting disability." Much of her Honour's reasons thereafter are taken up with a summary of the opinions expressed in the several medical reports. The judge was willing to infer that the worker's pre injury employment "included a strenuous activity" such as that carried out when she received injury. However, at the end of her reasons, her Honour concluded: "Overall, I have come to the conclusion that there has been a marked improvement in the condition for which Judge Freedom compensated the worker more than five years ago; that since about December 1986 at the latest, the worker has perceived herself as substantially incapacitated by conditions including those which are unrelated to the injury found by Judge Freeman; that at some time after 19 November 1984, the worker ceased to look for work and that it is probable that she has not been seeking employment since 28 August last year. An analysis of findings by Freeman J indicates his view that in November 1984, the worker's earning capacity had been reduced by about one third, as a consequence of injuries sustained in May 1982.... On the evidence and particularly in the absence of evidence from the worker, it is necessary to be arbitrary in finding the amount by which the worker's earning capacity continues to be diminished as a consequence of injury sustained in the relevant employment." Her Honour then proceeded to vary the award made by Freeman CCJ. She reduced the sum awarded to $50 per week "on the basis of the worker's partial incapacity pursuant to s11(1) of the Workers' Compensation Act 1926." It is from that award that the worker has appealed to this Court. It was common ground that the appeal lay both on disputed findings of fact as well as errors of law. For the worker, a number of complaints were made concerning the award and the reasons given for it. They concerned the use made by O' Toole CCJ of the failure of the worker to give evidence; the reliance upon her Honour's observations of the worker from her appearance and movement in the court outside the witness box; the approach taken by her to the medical evidence adduced by the parties; and the suggested failure properly to apply the provisions of s11(1) of the Act in calculating the worker's entitlement to compensation under that subsection. However, the primary thrust of the complaint on appeal was that her Honour had erred in her application of s11(2) of the Act, that she failed to apply that subsection to the undisputed facts, effectively reversed the burden of proof of compliance with the subsection so as to place it on the worker; and failed to give reasons explaining the course taken in denying the worker the continuing protection of s11(2). Because I consider that the complaint of error in the application of s11(2) of the Act has been made good (and because that requires the setting aside of the award) I will deal first with that question. Determination of the applicable statute At the outset, it is important to recall that the 1926 Act was repealed by the Worker' s Compensation Act 1987. See the 1987 Act, s281, Schedule 5. The 1987 Act came into force on 30 June 1987. However, by s282 of the 1987 Act, Schedule 6 has effect. That Schedule contains Pt4. That Part contains provisions continuing the operation of the 1926 Act in certain circumstances. 4 UNREPORTED JUDGMENTS The determination of the applicable statute is essential in order to determine which regime should apply to an award made following a determination by the Compensation Court that an earlier award should be reviewed and a fresh award made. Prima facie, any fresh award made is made under the 1987 Act, the 1926 Act having been repealed. Ordinarily, then, one would expect that the provisions of the 1987 Act would apply. So far as s11(2) of the 1926 Act is concerned, that subsection has been replaced by s38 of the 1987 Act which is in term significantly different from s11(2) of the 1926 Act. However, special provision has been made by CLS of Pt4 of Schedule 6 for the continuing operation of s11(2) of the 1926 Act in certain circumstances. The clause reads: "5. S11(2) of the former Act applies (instead of s38 of this Act) for the purpose of determining the weekly payment of compensation in respect of any period of incapacity for work occurring after the commencement of Division 2 of Pt3 of this Act and resulting from an injury received before that commencement." The relevant period of incapacity in dispute in the present application occurred after the commencement of Division 2 of Pt3 of the 1987 Act. It resulted, as found, from an injury received before that commencement. Thus, it resulted from an injury which occurred whilst the 1926 Act was still in force. Accordingly, the worker's entitlement to weekly compensation, in the event that the judge was to determine that review was justified, would be calculated in accordance with s11(2). This was the regime applicable to the worker's entitlement in the circumstances. No mention was made of the application of Schedule 6 in O'Toole CCJ's reasons. Nothing turns upon this omission. The parties before this Court (as doubtless before her Honour) accepted that the applicable statutory provision was s11(2) of the 1926 Act. One further problem arising from the change of legislation derives from the alteration of the review provisions under the 1926 and 1987 Acts. Under the 1926 Act, the power of review was provided by s60. Under the 1987 Act it is found in s55. There is a distinction in the language of the statutory provisions. S55 of the 1987 Act reads: "55(1)Any weekly payment of compensation may, because of a change of circumstances, be reviewed by the Compensation Court at the request of the employer or the worker or of the Authority." Apart from the reference to the Authority, the section now contains express reference to the need to establish a "change of circumstances". This is not mentioned in s60 of the former Act. However, nothing would appear to turn upon which of the two statutory provisions for review applies. In the application of s60 of the former Act it was determined long ago that, to secure review, a change in circumstances had to be shown. See eg Macdonald or Duris v Wilsons and Clyde Coal Company [1912] AC 513 (HL), 518; McAlinden v James Nimmo and Co Ltd [1920] AC 39 (HL), 44; Coalcliff Collieries Ltd v Campbell (1964) 112 CLR 349. It is therefore strictly unnecessary to determine which of the review provisions was invoked in this case. In terms of principle, it would appear to be that laid down by s55 of the 1987 Act. Having, therefore, before her an application for review, which required proof of a change in circumstances, O'Toole CCJ should have taken the following steps. She should have determined first whether the requisite change of circumstances had been shown by the employer to warrant the exercise of the URJ ATLAS v BULLI SPINNERS PTY LTD (Kirby P) 5 power of review. If, by reason of differing evidence about the extent of the worker's incapacity she were convicted that an applicable "change of circumstances" was shown justifying review, her Honour would then be obliged to exercise the powers conferred upon the Compensation Court by s55(2) of the 1987 Act (or s60(1) of the 1926 Act). This empowers the Compensation Court, relevantly, to end or reduce the weekly payment. In determining whether to do so, the judge would be obliged to apply s11(2) of the 1926 Act. It is now appropriate to set out the terms of that well known subsection as it stood at the relevant time: "11(2) An employer shall provide suitable employment for his injured worker during the worker's partial incapacity for work but, if the employer fails to do so, the worker shall be compensated as if his incapacity for work were total, unless [the employer]... provides, or arranges for, such suitable employment having regard to the worker's incapacity and place of abode." During the course of its history, following its original enactment in 1942, s11(2) of the 1926 Act underwent a number of changes, notably by the amending Acts of 1951 and 1980. I shall not trace the course of the amendments. It is set out in my judgment in George Weston Foods Ltd T/as Tip Top Bakeries v Rantino, Court of Appeal, unreported, 8 August 1991; (1991) NSWJB 67. However, the changes are not without significance. They successively moved the subsection towards imposing a more affirmative obligation on the part of an employer to provide suitable employment to an injured worker. It imposed upon the employer who failed to do so the obligation to compensate the worker as if that worker were totally incapacitated and not simply partially incapacitated. A basic error: application of s11(2) of the Act I now return to the basic error complained of by the worker. It is that her Honour effectively reversed the burden of proof and, in the absence of any evidentiary basis, failed to accord to the worker her entitlements under s11(2) of the Act and failed to explain why she had done so. There seems little doubt that O' Toole CCJ was affected by the worker's failure to give evidence in the review proceedings. At the beginning of her reasons she said: "The worker did not give evidence, permitting me to readily draw inferences to which I will refer." Later, she said: "Significantly, the worker did not adduce evidence regarding her readiness and willingness at relevant times to engage in suitable work." At the close of her reasons, O'Toole CCJ reviewed Freeman CCJ's earlier finding that the worker had "ceased to look for work" after November 1984. She inferred: "Tt is probable that she has not been seeking employment since 28 August last year." Immediately before proceeding to her conclusion and award, O'Toole CCJ said this: "On the evidence and particularly in the absence of evidence from the worker, it is necessary to be arbitrary in finding the amount by which the worker's earning capacity continues to be diminished..." Her Honour's reaction to the failure of the worker to give evidence is perhaps understandable having regard to the circumstances of most modern litigation. Normally, in a claim for compensation benefits, the worker carries the burden of establishing an entitlement. A failure to give evidence would, in such circumstances, ordinarily be fatal to discharging that burden. The omission of a person, with a large stake in the outcome of litigation to come forward (although 6 UNREPORTED JUDGMENTS present in the courtroom) to give evidence about matters upon which that person is in the best position to adduce relevant testimony, would in many circumstances properly contribute to a judge's reasoning to a conclusion relevant to that person's rights. However, with respect to O' Toole CCJ, there are a number of problems in the approach which she adopted: 1. A failure on the part of a person to give evidence, where evidence would otherwise be expected, does not of itself constitute an evidentiary fact. It merely permits the tribunal of fact to draw more readily than it otherwise would have done any inference that is available from the facts actually proved. In other words, the absence of evidence does not positively add to the relevant evidence. It is simply a consideration in the process of reasoning from the evidence which is actually adduced. See Jones v Dunkel and Anor (1959) 101 CLR 298, 317f; 2. A failure on the part of a party to give evidence does not warrant the alteration of the alignment of the burden of proof for which the law provides. In the present proceedings, the employer bore a double burden. First, it was for the employer to establish an entitlement to a "review" which merited, relevantly, the termination or reduction of the worker's entitlement to compensation. Secondly an award earlier having been entered by Freeman CCJ in the worker's favour under s11(2) of the Act the employer carried the legal burden of showing either that, in the terms of that subsection, it had provided suitable employment to the injured worker during partial incapacity or that, for some other relevant reason, it was relieved of the obligation to do so; and 3. Having herself found that there was some continuing partial incapacity on the part of the worker and failure to provide suitable employment having been established in the previous proceedings, O'Toole CCJ did not explain, by her reasons, she nonetheless concluded that the employer was relieved from that failure. The closest her Honour came to doing so was in the stated inference, which she drew, that the worker had "ceased to look for work" since the application for review was taken out. But this failure to look for work does not, even if proved, without more, relieve the employer of its continuing obligation under s11(2) of the Act. In the application of s11(2) of the 1926 Act a series of decisions of the High Court of Australia and of this Court made clear a number of relevant features of the subsection. It has been described as "deceptive" for its "apparent simplicity". See Dowell Australia Ltd v Archdeacon (1975) 132 CLR 417, 428. The burden imposed on employers by its provisions was described in the same case by Mason J as "intolerable": 1. The employer's duty, reflecting the language of the statute, is mandatory. See Shoebridge v The Commissioner for Railways (1961) 73 WN (NSW) 643 (FC), 651; Chudleigh v David Bros Pty Ltd (1962) 79 WN (NSW) 517 (FC), 522. The duty has been described as "clear, unconditional and unequivocal". See Wheatley v John Herford and Sons Ltd (1954) 54 SR (NSW) 232 (FC), 235; 2. The duty is a continuing one. It is not one exhausted either by a single application for suitable work or a single failure to provide it. It remains where the statute imposes it, ie upon the employer. It is a duty which subsists so long as the worker suffers partial incapacity which results from a work injury. See Electric Power Transmission Pty Ltd v D'Urso (1970) 124 CLR 338, 341; Cassidy v International Combustion Australia Limited, Court of Appeal, unreported, 10 October 1988; (1988) NSWJB 183; URJ ATLAS v BULLI SPINNERS PTY LTD (Kirby P) 7 3. Because employment of its nature requires mutuality on the part of a prospective employer and a prospective worker, it has been held that the employer is relieved of the duty imposed by the sub section if it is shown that the prospective worker was not, at the relevant time, "ready, willing and able" to perform work if offered such work by the employer. This was said in R J Brodie (Holdings) Pty Ltd v Pennell (1968) 117 CLR 665 and in Asciak v Australian Glass Manufacturers Pty Ltd (1964) 64 SR (NSW) 344 (FC), 351. It was applied in D'Urso, above at 341. If the worker refuses (or is not available for) employment offered by the employer, or if it is shown that the worker's conduct is relevantly inconsistent with the necessary degree of cooperation on his or her part, there will be no "failure" on the part of the employer to provide suitable employment. In such circumstances the worker's rights to compensation benefits, if any, will be determined under s11(1) of the Act. The worker will lose the additional entitlements for which s11(2) provides; and 4. In a primary application, this Court has held that the onus rests upon the worker to show that he or she is ready, willing and able to enter into suitable employment. See Trass v Qantas Airways Ltd [1976] 1 NSWLR 425 (CA), 427, 430, 433. It is this fact which makes it relevant, if not essential, for the worker to give evidence in a primary application as to that state of mind and the steps that have been taken to bring it to the notice of the employer. See eg Kogarah Golf Club Ltd v Sullivan and Anor, Court of Appeal, unreported, 23 April 1993 (1983) NSWJB 43 at 8. However, whilst the obligation imposed upon the employer is expressly stated in the statute, that imposed by judicial decision upon the worker is simply an inference from the very nature of "employment" and from the necessity to show in each case a "failure" on the employer's part to provide it. Once the correct inclination has been shown sufficiently to found an award under the section and, by inference, the "failure" of the employer proved (as it was here by a "rebuff" to the worker's offer) it is not necessary, in order to attract the sub section, that the worker should prove affirmatively repeated applications for suitable work from the employer. Least of all is it necessary where, as here, the earlier application was rebuffed and the earlier judge has accepted that the employer gave notice of redundancy to the worker and the worker asserted in her process a readiness, willingness and ability to perform selected duties if offered. The continuing duty being cast by the statute upon the employer to provide such employment, it is inevitable that, if the employer wished to demonstrate the inapplicability of the sub section, it was bound to prove either that it had provided suitable employment which was rejected by the worker or that, by positive evidence adduced or inferences reasonably open on such evidence, the worker was not ready to accept such work despite her pleader's assertion. The foregoing principles do not appear to have been applied by O' Toole CCJ once she decided that there had been a relevant "change of circumstances" and that review of Freeman CCJ's award was appropriate. I do not pause to consider whether that decision was a correct one on the facts, given the finding that some degree of partial incapacity continued, the continuing obligation which rested upon the employer to provide suitable work and the lack of any evidence that it had done so or even sought to do so. I will assume that her Honour was authorised to pass to the reopening of the award and thus to determining, in accordance with sl1 (including s11(2)), the worker's entitlement to weekly compensation upon the review. 8 UNREPORTED JUDGMENTS What was the evidence which warranted disturbance of the conclusion inherent in the award of Freeman CCJ that the employer had failed to provide suitable work to the worker during her partial incapacity? Still more pertinently, what was the evidence which would have justified the conclusion that it had positively been shown that the worker was not ready, willing and able, if offered it, to perform suitable work? When taxed upon these questions by this Court, the employer could point only to the inferences which were available to her Honour from the film which she saw and the medical reports which were produced in evidence. Her Honour's observations of the worker in the courtroom outside the witness box were, it was conceded, available only to confirm or displace other conclusions available in the evidence. Cf Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304 (CA), 324. In my view neither the film nor the medical reports provided any evidence upon the basis of which it could be inferred that the employer had provided suitable work or that the worker was not ready, willing and able to perform suitable work if offered. Neither element of the evidence dealt directly with these issues. The medical reports do contain factual statements. But these are provided only as the bases upon which the expert opinions of the medical practitioners are based. They do not, in themselves, prove the facts recorded in the medical histories. Even allowing for some degree of informality in the reception of evidence in the Compensation Court, none of the medical histories records the fact that the worker had been offered and had refused suitable employment. None of them positively asserts that the worker would, if offered such employment, have declined such an offer. On the contrary, insofar as there was any statement before the Compensation Court on that subject, it was contained in the worker's Answer, filed in the proceedings. By that answer, the worker expressly denied a lack of readiness, willingness and ability to perform suitable work. She stated that she was "ready, willing and able to undertake selected duties". Thus the employer was upon notice from the record that the worker asserted such readiness. Against the background of these facts, O' Toole CCJ's decision to deny the worker the benefit of the section is inconsistent with: 1. The finding of continuing partial incapacity attributable to the work injury; 2. The earlier finding of a failure of the employer to provide suitable employment to the worker; 3. The assertion by the worker that she was ready, willing and able to accept it; 4. The failure of the employer to prove that any such work had been offered to the worker; and 5. The absence of any direct (or even indirect) evidence that the worker was not ready, willing and able to accept such work if offered despite the assertion in the pleading. There therefore appears to have been no factual basis upon which O' Toole CCJ could have come to her conclusion in the evidence proved before her. In any case, her Honour in her reasons pointed to no facts which would justify such a conclusion. She seems to have assumed that the burden was on the worker to prove that she was ready, willing and able to perform work provided by the employer. With respect, this demonstrated three errors: (a) In the review proceedings before the Court it was for the employer, and not the worker, to make out a case of change of circumstances; URJ ATLAS v BULLI SPINNERS PTY LTD (Kirby P) 9 (b) S11(2) casts the obligation to provide suitable employment upon the employer and does not impose an obligation, as such, upon the worker; and (c) No reasons were provided to explain how the contrary conclusion was arrived at. The appropriate order: return to Compensation Court The worker asked that, if the foregoing conclusion of error was reached this Court should proceed, allowing the appeal, to enter an award in favour of the worker. If the Court were of the view that some evidence existed to justify the award, but that it was not adequately explained in her Honour's reasons, the Court should return the matter for retrial and the provision of reasons as the law requires. Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 (CA). The wide powers afforded to this Court permit it to take which ever of the above courses seems most appropriate. Certainly, the Court is empowered under s32(2)(b) of the Compensation Court Act 1984 to make "such other order [ie than remittal to the Compensation Court] in relation to the appeal as the Supreme Court sees fit". Because of I am of the view that there was no evidence to justify the termination of payments of weekly compensation upon the basis of notional total incapacity, I was at first minded to accept the worker's submission and to propose that the appeal be allowed, the application for review dismissed and an award entered in that review in favour of the worker. However, upon reflection I believe that the better course is to remit these proceedings to the Compensation Court for re determination. It is possible that there was some confusion about the statutory regime to be applied by the transitional provisions. Certainly it seems clear that the learned primary judge approached the question before her by applying an incorrect statutory test both for the conduct of the review and, once review was determined, in the application of s11(2) of the 1926 Act. Once this conclusion is reached it seems that the employer's case was never properly heard and determined as the law provides. The Compensation Court is a specialist body. It will often be appropriate to leave it to that court to dispose of the merits of claims, even where sufficient error of law or fact has been shown to warrant the intervention of this Court and the disturbance of the awards of the Compensation Court. Such is the course which I would favour in this case. In the light of the foregoing conclusions it is unnecessary to determine a number of other grounds of appeal which were raised, but not ultimately argued, before this Court. These grounds will doubtless be taken into account by the parties in the way in which the proceedings at first instance are conducted when the matter is returned to the Compensation Court. It is unnecessary to deal with these additional grounds or, indeed, to say anything at all about them. Orders The orders which I therefore propose are: 1. Appeal allowed; 2. Set aside the award of her Honour Judge O'Toole dated 13 June 1990; 3. In lieu thereof, order that the proceedings be returned to the Compensation Court for re determination of the application for review conformably with the decision of this Court; 4. Costs order of the earlier proceedings in the Compensation Court confirmed; and 5. The respondent to pay the appellant's costs of the appeal but to have, if otherwise so qualified, a certificate under the Suitors' Fund Act 1951. 10 UNREPORTED JUDGMENTS Mahoney JA I agree with the judgment of Kirby P. However, as the matter will be returned to the Compensation Court for reconsideration, I shall state briefly the basis on which, in my opinion, the worker's claim should have been dealt with. On 19 November 1984 Freeman J made an award for weekly payments of compensation to the worker. That award was made under the Workers Compensation Act 1926. That Act was repealed by the Workers Compensation Act 1987. However, that repeal did not, of course, affect the continuation of the rights created by the award. On 2 November 1989 the employer applied for a variation of the award. The application was made under s55 of the 1987 Act. It was the power given by s55 which her Honour Judge O' Toole exercised in the present proceeding. It is not in question but that, under s55, an award made under the 1926 Act may be varied. On 11 November 1990 O'Toole J held that the worker's degree of incapacity was less than it was when Freeman J made his award in 1984. Her Honour therefore varied that award to provide for weekly payments only of $50 per week. In considering what O'Toole J did, it is necessary to understand that the original award had been made upon the basis that the worker was partially incapacitated within s11(1) of the 1926 Act, that his Honour was satisfied that the employer had not provided suitable employment for the worker during her partial incapacity and that accordingly the worker was to be compensated as if her incapacity was total: s11(2). When O'Toole J exercised her powers under s55 of the 1987 Act, she was entitled to take into account any change in the extent of the incapacity of the worker and to make a variation in the award appropriate in that regard. But it was necessary for her to consider the basis on which, having regard to that change in capacity, the order was to be made. That basis was provided, inter alia, by Schedule 6 of the 1987 Act. S282 of the 1987 Act brought Schedule 6 into operation. Schedule 6 provided that, subject to the Schedule, Division 2 of Pt3 of the 1987 Act applied to injuries received before or after the commencement of that Division. It therefore applied all of the sections of the 1987 Act here relevant, including s55. Had Schedule 6 contained no other relevant provision, then the quantum of an award appropriate to the partial incapacity from which the worker suffered in 1990 might perhaps have been determined, inter alia, by s33 et seq of the 1987 Act. However, CL5 of Schedule 6 provided: "5. S11(2) of the former Act applies (instead of s38 of this Act) for the purpose of determining the weekly payment of compensation in respect of any period of incapacity for work occurring after the commencement of Division 2 of Pt3 of this Act and resulting from an injury received before that commencement." Accordingly, when O'Toole J came to consider what order should be made under s55, her Honour was required to have regard to the fact that, if she was then making a substantive award, she was, in "determining the weekly payment for compensation in respect of any period of incapacity for work" after the commencement of the 1987 Act, required to apply s11(2) of the 1926 Act. She would, in effect, be required to consider whether, if partial incapacity was then existing, the employer had failed to provide suitable employment within s11(2). If it had, then, in determining the weekly payment of compensation to which the worker was entitled, that payment was to be determined on the basis of total incapacity. For this purpose, it mattered not that the quantum of incapacity was less than it had previously been. URJ ATLAS v BULLI SPINNERS PTY LTD (Clarke JA) 11 I do not wish to pre-empt the ambit of the power of review given by s55 of the 1987 Act. It is arguable that, in some circumstances, s55 may authorise the variation of an award on a basis of only partial incapacity even though the terms of s11(2) have been satisfied. That matter was not examined in this case. On the facts of this case, there appears no reason why, on the review made by her, her Honour should not have applied s11(2) as CL5 directs. Her Honour does not appear to have been asked to deal with the matter on this basis. The order that she made was, in the terms of her judgment, based merely upon s11(1) and conditioned to the quantum of partial incapacity. It is arguable that prima facie she could have made an order of that kind only if s11(2) was to be put aside, that is, upon the basis that an issue had been raised and fought as to whether the employer was in default under s11(2) of the 1926 Act and that that issue had been determined in favour of the employer. But that issue does not appear to have been raised and fought. Her Honour referred in passing in the judgment to the fact that the worker did not give evidence as to her willingness to work and that she had ceased seeking employment on the market. But there was no suggestion that the employer had offered any employment or that the worker had, within the authorities, indicated that whatever employment was offered she would not accept it. That matter was, I think, left in the state in which it was when the matter was dealt with by Freeman J. I have considered whether it is appropriate for this Court to itself make an order in favour of the worker on the basis to which I have referred. For the reasons referred to by Kirby P, I do not think that it can or should. It may be that there are factors affecting the quantum of compensation to be ordered upon the basis of total incapacity which are not presently before this Court. In these circumstances, I think the matter must be returned to the Compensation Court. I agree with the orders proposed by Kirby P. Clarke JA I agree with the orders proposed. It is not easy to discern upon what basis her Honour terminated the order under s11(2) and made a fresh order under s11(1) In particular I find it difficult to see upon what grounds her Honour concluded that the order under s11(2) should come to an end. Her Honour did say that the appellant did not adduce evidence regarding her readiness and willingness at relevant times to engage in suitable work but that finding is not linked in the judgment with the decision to bring the award under s11(2) to an end. Indeed no express reasons are assigned for that conclusion It would seem that her Honour was of opinion that her finding that the appellant's condition had improved prior to the hearing justified the order which she ultimately made. It may be that in particular circumstances a finding of that nature would be sufficient to substitute an award under s11(1) for one under s11(2) but as at present advised I would think that that might occur only in a rare case which I find it difficult to foresee What is more to the point is that on the facts of this case that circumstance is not enough to justify the order made In short I agree with Kirby P and Mahoney JA that her Honour has failed to consider the critical question, that is, whether the respondent discharged the onus of showing that there had been such a change in circumstances that the order under s11(2) should be terminated or, if she did, she failed to apply the correct test. Accordingly, the award should be set aside. I agree with the orders proposed by Kirby P. 1. Appeal allowed; 12 UNREPORTED JUDGMENTS 2. Set aside the award of her Honour Judge O' Toole dated 13 June 1990; In lieu thereof order that the proceedings be returned to the Compensation Court for re determination of the application for review conformably with the decision of this Court; 5 4. Costs order of the earlier proceedings in the Compensation Court confirmed; and 5. The respondent to pay the appellant's costs of the appeal but to have, if otherwise so qualified, a certificate under the Suitors' Fund Act 1951. » 19 Counsel for the Appellant: M Joseph Instructed by: Gibsons Counsel for the Respondent: LJ Ellison / M MacRossan 15 Instructed by: Hunt and Hunt