BAGGS v DEPARTMENT OF SCHOOL EDUCATION SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MASON P, SHELLER and STEIN JJA 7 May 1998, 7 May 1998 [1998] NSWCA 29 WORKERS COMPENSATION — there was evidence that worker' disability was continuing Sheller JA The applicant, Mr John Baggs, filed a further amended application for determination in the Compensation Court dated 5 August 1996 in which the Department of School Education was named as the respondent. A previous application had been filed in 1995 in which the State of New South Wales was named as a respondent. Apparently, the further amended application was filed following an order by Geraghty J on 25 July 1996 which was made on the application of either the State of New South Wales or the Department of School Education or the Department of Public Works, a second respondent added in the amended application. Mr Baggs claimed that when he was employed as the general manager in the school furniture complex run by the Department between 1 January 1990 and 30 November 1993 the nature of his work caused, relevantly, him to suffer from diabetes. He claimed partial incapacity for work from 30 November 1993 to date. The application came before Commissioner Hunt on 25 October 1996. On 23 January 1997 the Commissioner made an award in favour of the applicant and gave his reasons for so doing. On 19 February 1998 the Department applied to have the award set aside, proceeding apparently under s36 of the Compensation Court Act 1984 before it was repealed, or amended, by the WorkCover Legislation Amendment Act 1995. This application, which under that section would have been an application for review of the Commissioner's decision, was heard by Truss J on 16 May 1997. On 26 May her Honour allowed the review, set aside the Commissioner's decision and substituted an award for the respondent Department. Mr Baggs appeals from that decision. The grounds of appeal were that her Honour erred in law in finding a retirement certificate which was in evidence before her was not evidence of incapacity after 1 November 1993, that she erred in law in finding there was no evidence of any acceleration or aggravation after | November 1993 and that she erred in holding that the respondent's appeal was to be dealt with as a review rather than an appeal on a matter of law only. Hunt C found that the applicant was diagnosed with diabetes on his return to Australia from an overseas business trip sometime in the latter part of 1990. In August 1993 the applicant was certified unfit for work due to unstable diabetes. This certificate was renewed to 31 October 1993. The two certificates were given by Dr Malcolm Parmenter, who was at the relevant time the applicant's treating general practitioner. In each of them Dr Parmenter certified that Mr Baggs was unfit for work: in the first for a period of thirty-four days from 30 August to 2 2 UNREPORTED JUDGMENTS October 1993; the reason given was unstable diabetes; in the second for thirty-one days from 1 October 1993 to 31 October 1993, again the reason given was unstable diabetes. Subsequently, as Hunt C found, the applicant was retired as medically unfit. This followed upon a retirement certificate which was dated 6 October 1993 and given by a legally qualified medical practitioner, Dr Graham. Dr Graham certified that on that date he had carefully examined Mr Baggs. The certificate continued: "T find that he is suffering from unstable diabetes mellitus aggravated by adjustment reaction to work related pressure: sequelae of multiple carpal dislocations (L); lumbo-sacral intervertebral disc lesions with nerve root irritation; rotator cuff syndrome (L). Iam of the opinion that he is in consequence unable to discharge the duties of his office. I am further of the opinion that his disability will in all likelihood prove permanent. It is possible that he may be able to be retrained to perform clerical duties in a low-stress environment, initially on a part-time basis". In addition to being signed by Dr Graham, the certificate was signed by Dr Gapper, director and a New South Wales Government medical officer, who stated he concurred with the report. At the bottom of the report are written the words "Review in 2 years recommended". Having referred to the certificate of Dr Graham, the Commissioner said: "Tt is significant that in these proceedings the respondent made no endeavour by way of cross-examination or through it's own evidence to counter the claims made by the applicant concerning the stressful nature of his employment nor of the treatment he received between March 1991 and his retirement in October 1993. If, as is suggested by the bulk of the medical opinion provided in this case, stress is capable of aggravating, accelerating or exacerbating the condition of diabetes then it is most probable that the applicant's condition was aggravated, accelerated, exacerbated by the nature and conditions of his employment". The Commissioner found relevantly that the onset of the applicant's diabetes in 1990 was accelerated by the nature and conditions of his work and that that condition had been aggravated and exacerbated since by the nature and conditions of his employment. He ordered that the respondent pay to the applicant compensation on a weekly basis from 1 November 1993 to date and continuing. The application made by the Department which brought the matter before Truss J was contained in a notice of motion in which a number of grounds were set out. However, in her judgment her Honour isolated what I understand to have been the issues between the parties on the matters before her. Firstly, her Honour dealt with the preliminary argument raised by the applicant that the proceedings should have been by way of appeal pursuant to s34A of the Compensation Court Act which was inserted by the WorkCover Legislation Amendment Act which also repealed s36. Her Honour ruled, however, that pursuant to Sch 4 Pt4 cl7 that the application was properly characterised as an application for a review because the initial application for determination was filed in September 1995 prior to the amendments which came into force on | February 1996. Accordingly, her Honour proceeded to deal with the matter on the basis, that it was a review procedure under s36. URJ BAGGS v DEPARTMENT OF SCHOOL EDUCATION (Sheller JA) 3 The material placed before her Honour consisted of the pleadings, the transcript of two days evidence, the exhibits and the Commissioner's reasons. No other evidence was tendered nor sought to be relied on and there was no issue as to the applicant's credit. Having referred to the Commissioner's findings her Honour said that the primary ground relied upon by the Department was that there was no evidence to support the finding of ongoing incapacity. Alternatively, apparently, a challenge was made to the quantification of the applicant's entitlement. However, her Honour dealt with the matter, as appears from her reasons for judgment, on what she stated to be the primary ground. In doing so, her Honour said that the respondent conceded that there was evidence, both lay from the applicant and medical, to support the Commissioner's finding that the applicant suffered aggravation, acceleration or exacerbation of the disease whilst in the employ of the respondent and that his employment, in particular the stresses and stains and long hours associated therewith, was a contributing factor to such aggravation, acceleration or exacerbation. Her Honour said: "However, what the respondent challenged is the finding implicit in the judgment that such aggravation continued beyond | November 1993. Although it was [not] entirely clear, it appears from the evidence that the applicant last worked on 30 August 1993. He was paid his normal salary up to 31 October 1993. The respondent submitted that the aggravation of the diabetes resulting from his employment was of a transient nature only the effects of which had ceased by | November 1993, that there was no evidence that after that date he was incapacitated due to work caused aggravation or that such aggravation was continuing as at the date of hearing." I stress the point made was that there was no evidence. Her Honour continued: "Tt emerges from the medical evidence, and again the respondent does not dispute, that from the date claimed the applicant has suffered from what could be described as a susceptibility to the diabetes becoming unstable in the event that he works excessively long hours thus becoming fatigued or is exposed to stresses in the workplace. However, the respondent submitted that such susceptibility results from the constitutional condition itself and is not from the ongoing effects of any aggravation brought about by his employment with the respondent". It was that issue so described that I understand her Honour to then have addressed. In doing so she referred immediately to the certificate given in October 1993 by Dr Graham. After referring to some submissions that were put by counsel her Honour said: "There was no evidence before the Commissioner that the applicant's condition was unstable after 1 November 1993 and I do not consider that on any view of the certificate it can be regarded as evidence of incapacity after 1 November 1993 due to aggravation, acceleration or exacerbation of the disease to which his employment with the respondent was a contributing factor". Her Honour then referred to evidence given by Dr Parmenter and to a report from Professor Hall. Her Honour observed that doctors, namely Dr Rob Coles and Dr Boyages, who had treated the applicant in 1993 and later did not give evidence. Her Honour then quoted a passage from the report of Professor Hall and concluded: 4 UNREPORTED JUDGMENTS "Having considered the transcript and the medical evidence to which I have referred I have come to the conclusion that there was no evidence to support a finding that the effects of the aggravation, acceleration or exacerbation of the applicant's diabetes resulting from his employment with the respondent continued after 1 November 1993". On that basis, her Honour set aside the Commissioner's decision. It was submitted on behalf of the appellant that (i) her Honour erred in treating the matter before her as a matter appropriate to review under s36, (ii) the amendment of the legislation required, in light of the date at which the amended application was filed, joining the Department of Education as a defendant, and (iii) the matter before her could only be treated as an appeal pursuant to s34A of the Compensation Court Act. It is not entirely clear to me on what basis Geraghty J ordered that the Department be joined as a party to the proceedings. It should be accepted, for the purpose of these proceedings, that the Department can be treated as an employer separate from the Crown, and I refer to the decision of this Court in Haines v Tempesta (1995) 37 NSWLR 24. A difficult question may arise if it could be said, as Mr Hall QC who appeared for the Department claims, that in truth what was done was to remedy a misdescription rather than join a new party. For present purposes, I think it is unnecessary to resolve whether or not her Honour rightly treated the matter before her as a review. It is quite clear from her Honour's judgment that she proceeded on the basis that there was, as she said, no evidence to support a finding that the effects of the aggravation of the applicant's diabetes continued after 1 November 1993. That finding is challenged by the applicant who has taken us in detail to the form of the retirement certificate which Ihave set out. It seems to me, first that the certificate is evidence that at the time it was given the applicant was suffering from unstable diabetes mellitus aggravated by adjustment reaction to work related pressures, and secondly, that in the opinion of the person who gave the certificate that disability would in all likelihood prove permanent. As I would understand what was said by Truss J in her reasons for judgment, the issue was not whether the condition of instability would continue but whether or not the susceptibility to such instability would continue and it was that susceptibility which was claimed to have been brought about or aggravated by the work conditions. Dr Graham went on to refer to the possibility that the applicant might be able to be retrained to perform clerical duties in a low stress environment initially on a part-time basis, which emphasises that the doctor was indeed talking about what he saw as the continuance of this particular work-related aggravation. In my opinion, it is quite clear that the certificate was indeed evidence of the matter of which her Honour said there was no evidence. Furthermore, it is to be observed that that certificate is consistent with the two certificates given by Dr Parmenter. Mr Hall took us to evidence given by Dr Parmenter to support the view that her Honour's conclusion, even if it were not a "no evidence matter", could be supported. Even if that were an appropriate way in the absence of a notice of contention of addressing this appeal, it seems to me that Dr Parmenter's evidence must be looked at in the light of the two contemporary certificates that he gave. This being the case, in my opinion, her Honour erred in law in reaching the conclusion she did that there was no evidence to support a finding that the effects of aggravation continued after 1 November 1993. URJ BAGGS v DEPARTMENT OF SCHOOL EDUCATION (Mason P) 5 That being so, in my opinion the appeal must be upheld. The orders made by her Honour must be set aside and an order made restoring the award made by the Commissioner. In those circumstances, in my opinion, the respondent should pay the appellant's costs of this appeal. Mason P IJ agree. Stein JA I also agree. COUNSEL ADDRESSED ON COSTS Mason P It would appear that the Commissioner made an order for costs against the Department of School Education, that will be reinstated by the orders proposed by Sheller JA. Sheller JA The order would be then that the respondent pay the appellant's costs of the hearing before Truss J and of this appeal and I propose that we do that. Mason P That will be the order of the Court. Appeal upheld. Respondent to pay the appellant's costs of this appeal. Counsel for the appellant: T F McKenzie Solicitors for the appellant: Matthews Folbigg Counsel for the respondent: J N Gleeson QC/E G Romaniuk Solicitors for the respondent: Moray & Agnew