Commonwealth v Scott [1979] FCA 4; (1979) 41 FLR 405 (8 February 1979)

FEDERAL COURT OF AUSTRALIA

COMMONWEALTH v. SCOTT (1979) 41 FLR 405
Workers' Compensation - Administrative Law

COURT

FEDERAL COURT OF AUSTRALIA
GENERAL DIVISION
Fisher J.(1)

CATCHWORDS

Workers' Compensation - Incapacity for work resulting from diseases contributed to by employment - Lump-sum award - First determination set aside - Employee's application to Tribunal for determination of incapacity - Adjournment of hearing - Effect of preliminary reasons - Power of Tribunal to make ultimate finding of total incapacity - Effect of adverse inference drawn by Tribunal from employer's failure to tender evidence - Compensation (Commonwealth Government Employees) Act 1971 (Cth.), ss. 20 (2) (b), (4) (a), 29, 39 (14), 45, 46, 60, 63 (1) (a), 83 (1), (2) (d), 95 (1).

Administrative Law - Quasi-judicial tribunals - Interference by Tribunal with conduct of case by parties. The respondent instituted a claim under the Compensation (Commonwealth Government Employees) Act 1971 (Cth.) ("the Act") against the appellant, his former employer, in relation to diseases to which he alleged his former employment had contributed. In March 1977 a determination of compensation was made and a lumpsum award for an injury was made under s. 39 of the Act. In July 1977 the Commonwealth Employees' Compensation Tribunal ("the Tribunal") heard an application by the respondent for the reconsideration of his claim and a determination in regard to his incapacity for work resulting from one of the diseases and delivered reasons making findings of fact on the basis of concessions by the appellant and adjourned the matter for legal submissions. By further reasons in September 1977 the Tribunal set aside the determination of March 1977 and adjourned the further hearing of the matter to a later date for directions to be given to enable a further determination to be made. After a second hearing in December 1977 the Tribunal, in January 1978, found that the respondent was totally incapacitated and entitled to compensation under s. 45 of the Act.

On appeal,

Held: (1) The Tribunal was not precluded from reaching the conclusion it did. It had not earlier reached a determination of partial incapacity and had not by its reasons of September 1977 precluded further evidence being given of total incapacity. Even if it had reached such an earlier determination it could have varied that determination under ss. 20 (4) (a) and 83 (1) of the Act.

(2) Even if the respondent had based his case on a submission of partial incapacity, and this could not be stated with certainty, the appellant would not, in the circumstances, have been prejudiced by the subsequent change of submission. Taking the appellant's submission at its best the appellant had not been denied natural justice.

(3) The Tribunal had not misapprehended the effect of the medical evidence put before it and in any event there was other evidence available to support its conclusion.

(4) The adverse inference that the Tribunal drew from the appellant's failure to tender a recent medical report concerning the respondent, obtained under s. 60 of the Act, was not essential to the ultimate finding which was open on the other evidence.

Consideration of the extent to which a statutory tribunal should interfere with the litigant's conduct of the case.

Sullivan v. Department of Transport (1978), 20 ALR 323; Hoggard v. Worsbrough Urban District Council, (1962) 2 QB 93, referred to.

HEARING

Adelaide, 1978, November 28; 1979, February 8. 8:2:1979
APPEAL.

The facts appear from the judgment.

P.L. Sharp Q.C. and P.B. Kirby, for the appellant.

H.W. Olney, for the respondent.
Cur. adv. vult.

Solicitor for the appellant: A. R. Neaves (Commonwealth Crown Solicitor).

Solicitor for the respondent: Graeme M. Rattigan.
T. J. GINNANE

DECISION

February 8.

FISHER J. delivered the following written judgment.
This is an appeal by the Commonwealth of Australia ("the appellant") under

s. 95(1) of the Compensation (Commonwealth Government Employees) Act 1971 (Cth.) ("the Act") from a determination dated 12th January, 1978, of the Commonwealth Employees' Compensation Tribunal ("the Tribunal"). Section 95(1) requires that such an appeal be "on a question of law only". (at p406)

2. The course the matter has taken is canvassed in the three sets of reasons of the Tribunal dated 15th July, 1977, 15th September, 1977, and 12th January, 1978, respectively and there is no need to repeat all of what is there set out. (at p406)

3. Before his retirement at about the end of 1976 William Dawson Scott ("the respondent") was employed as an aircraft maintenance overseer with the Commonwealth Department of Transport and had been employed by that department for slightly more than thirty years. In late 1975 he began to complain of a hearing disorder - a high-frequency buzzing in his ears. This has been diagnosed as tinnitus of the right ear. Associated with it was a binaural sensori-neural high tone hearing loss which had been noted at tests of the respondent's hearing in previous years. In about June 1975 he had suffered a heart attack and the complaints of the tinnitus began about a month after his return to work in September 1975 following sick leave taken because of the heart condition. (at p406)

4. His capacity for work deteriorated from this time onwards and again, in February 1976, he took more sick leave and remained on sick leave until his retirement. (at p406)

5. In December 1975 the respondent instituted a claim under the Act directed to the Commissioner of Employees' Compensation for compensation on the basis that his loss of hearing and tinnitus resulted from exposure to aircraft engine noise over a long period in his work. The first determination of compensation was dated 25th March, 1977, and a lump-sum award for an injury was made under s. 39 by the delegate of the Commissioner. The respondent sought the reconsideration of his claim by the Tribunal pursuant to s. 63 (1) (a) of the Act. In so doing he requested a determination under s. 29 in regard to his incapacity for work as a consequence of the tinnitus. (at p407)

6. The evidence put before the Tribunal on the two occasions that it heard the matter, namely 15th July, 1977, and 13th December, 1977, came from medical sources, from oral evidence given by the respondent's colleagues at work and from the respondent himself. (at p407)

7. By the time of the delivery of the September 1977 reasons the medical evidence supported the conclusion that he was affected by the tinnitus and the heart condition and suffered some incapacity. This was the evidence contained in reports of hearing tests, reports by Dr. Hughes and Mr. Sunderman and the oral evidence of Dr. Clements who had conducted one of the above hearing tests, which latter oral evidence the Tribunal particularly relied upon. In addition the evidence of a colleague at work given at the July hearing confirmed the deterioration in his work performance after about October 1975 and the fact that the respondent complained of his tinnitus. The respondent's own evidence at this hearing was to the effect that he was greatly distressed by the tinnitus, that it hindered his sleeping and recovery from the heart attack and that consequently he was always very tired at work. (at p407)

8. The evidence at the December 1977 hearing was more extensive as regards the respondent's incapacity for work. The second of two medical reports from Dr. Chew specifically dealt with the nature and extent of his incapacity for work concluding that: "Mr. Scott is medically unfit for employment involving physical and/or mental exertion and stress. He is also unable to work regularly and consistently on account of his tinnitus and related symptoms." Evidence was also this time given by two of the respondent's colleagues at work (including further evidence from the colleague above mentioned) confirming the difficulties the respondent suffered before his retirement and that he was incapable of performing his work with the department. In the opinion of the colleague who had not previously given evidence the respondent "was not really capable of doing any sort of job at all". (at p407)

9. At the conclusion of the evidence at the July 1977 hearing the appellant conceded that: (a) the employment of the claimant by the Commonwealth was a contributing factor to the contraction of the tinnitus; and (b) partial incapacity resulted therefrom; (c) the retirement of the claimant from the public service was, inter alia, on the grounds of his tinnitus; (d) the claimant is now totally incapacitated for work unless as an "odd lot"; (e) the degree of deafness the claimant suffered resulting from his employment is of or about the order of 7.2 per cent loss of hearing. (at p408)

10. The Tribunal in its July 1977 reasons found as matters of fact the concessions by the appellant and set aside the determination of 25th March, 1977. It then adjourned the matter "for legal submissions by the parties on the effect of the facts so found". (at p408)

11. The appellant in its submissions then sought to retreat from concession (c) on the ground that it had now been informed that the respondent's heart condition was the sole cause of his retirement. (at p408)

12. In its September 1977 reasons the Tribunal decided that even if it reconsidered the matter it would come to the same conclusion on the facts covered by concession (c) even though it might now be possible to say that the respondent's retirement was in fact in part due to the heart condition. The Tribunal also found that the tinnitus condition was a condition different from the hearing loss and that the lump-sum award for the latter under s. 39 in the determination of 25th March, 1977, was separate from and did not prevent or meet a claim under s. 46 of the Act for partial incapacity for work. Its concluding words are important to note. It set aside the determination of 25th March, 1977, and adjourned the hearing to a later date when it would "then give appropriate directions for the continued reconsideration of this matter to enable a determination to be made in substitution for the determination set aside". To that stage it had spoken of only one determination having been made, that of the delegate on 25th March, 1977, and spoke of the "continued reconsideration of this matter". (at p408)

13. At the December 1977 hearing the appellant called no evidence and in doing so refused to put into evidence a medical report of the respondent's condition obtained by it under s. 60 of the Act. As a result of this refusal the Tribunal indicated during argument that it would draw an unfavourable inference against the appellant. After reiterating this in its January 1978 reasons and after discussing the evidence that the respondent had adduced at the hearing to the effect that he was totally incapacitated for work it stated that it drew the inference that the report that had not been put in evidence accorded with the respondent's evidence. The Tribunal found that the respondent's labour was unsaleable in any market reasonably open to him. He was therefore totally incapacitated for work and entitled to compensation under s. 45 of the Act. Section 39 (14) necessitated the further finding that he was not entitled to compensation under s. 39 as well as s. 45. (at p409)

14. The Tribunal made its determination in the following terms:
"Accordingly in substitution for the determination of 25th March, 1977, in this matter set aside on 15th September, 1977, I determine: (a) the claimant, William Dawson Scott, contracted diseases namely tinnitus to the right ear and binaural sensorineural high tone hearing loss to which his employment was a contributing factor; (b) he is totally incapacitated thereby; (c) he is entitled to payment of compensation under s. 45 of the Act." (at p409)

15. The appellant appealed against this determination upon many grounds but at the hearing of the appeal abandoned all of them and by consent substituted two amended grounds of appeal as follows: 1. It was not open to the Tribunal to find that the respondent was totally incapacitated and entitled to payment of compensation under s. 45 of the Compensation (Australian Government Employees) Act 1971, as amended. 2. The Tribunal misdirected itself in respect of the fact that the appellant did not call evidence at the hearing on 13th December, 1977. (at p409)

16. The first ground of appeal raises, as it was acknowledged by the respondent, a question of law. However the appellant is limited on this ground to the contention that there was no evidence at all, as opposed to a contention of insufficiency of evidence or of a lack of satisfactory evidence, upon which it was open to the Tribunal to find total incapacity for work. However the appellant did not quite put its submissions in this way. (at p409)

17. Under this ground of appeal three arguments were tendered. In the first instance counsel contended that in the September 1977 reasons the Tribunal had made a finding of partial incapacity for work, and that it could not go back on this decision. Secondly it was contended that the respondent's case throughout the hearings before the Tribunal was presented on the basis of his being only partially incapacitated for work. In each instance there was, it was submitted, a change of ground by the respondent without notice of the change being given to the appellant. Finally counsel contended that the Tribunal misapprehended the effect of certain evidence, namely that of Dr. Chew, contained in the two medical certificates put into evidence at the final hearing and that the consequence of correctly construing these certificates was that there was no evidence at all on which a finding of total incapacity for work could be made. (at p410)

18. I will deal with each of these submissions in turn, but I must make the comment generally that I am far from satisfied that each of them raises a question of law. However in the light of the conclusion to which I feel bound to come there is no need for me to analyse the submissions on this aspect of the case. The first two submissions could perhaps have been put forward as breaches of the principles of natural justice, i.e. that natural justice was denied to the appellant, but such an argument was not developed and in my view could not have been put forward with any prospects of success. (at p410)

19. As to the submission that the Tribunal had made a finding to the effect that the respondent was only partially incapacitated for work and was not entitled ultimately to find that he was totally incapacitated for work, I am unable to accept this contention. Assuming however that such a finding had been made and assuming further that such a finding had the status of a determination, it was still open to the Tribunal to vary its determination. The Tribunal is an administrative body, being the alter ego of the Commissioner expressly directed to reconsider the decisions of the Commissioner (s. 63 (1) (a)) and having for this purpose all the powers conferred on the Commissioner by the Act (s. 83 (1)). By s. 20 (4) (a) the Commissioner "of his own motion" is expressly empowered to reconsider his determinations. Such powers enure to the Tribunal and even if the above assumptions be correct, it was open to the Tribunal to vary its determination of partial incapacity for work. (at p410)

20. However in my view neither assumption is justified. It is not in my view correct to say that the Tribunal had prior to the final hearing made a determination of partial incapacity for work. This I think is indicated by the concluding terms of the Tribunal's September 1977 and January 1978 reasons already quoted which make it clear that no determination, apart form that of the delegate in March 1977, was made until the one made in January 1978. If the Tribunal had purported to do so, it would have been in the position of having made the finding in advance of hearing crucial evidence on the topic. It had no, or at least only incomplete, evidence prior to the final hearing which would have assisted it to assess the extent of the respondent's loss of earning power. (at p410)

21. At most it seems to me that the expression "partial incapacity" was at times used somewhat loosely by the Tribunal as indicating that the then state of evidence revealed that the respondent had some capacity to work. However, it would not be correct to say that at that stage the Tribunal had determined that such capacity, limited as it was, was saleable in the market place. (at p410)

22. The correct view to my mind is that at the time of its September 1977 reasons the Tribunal formed the opinion that the evidence to that date indicated that the claimant had not suffered a total loss of earning capacity, that it was still possible for him to work, but that it reserved the question of the value to be placed upon his capacity for work. The Tribunal used words which indicated the nature of its then opinion, but framed it in such a way as to label the opinion as tentative rather than final. Tentative as it had to be until all the relevant evidence was before it. I refer to the words of par. 21 of the September reasons: "There is total incapacity for work 'where a man has a physical defect which makes his labour unsaleable in any market reasonably accessible to him, and there is partial incapacity for work when such a defect makes his labour saleable for less than it would otherwise fetch' (per Dixon C.J. in Commissioner for Railways (N.S.W.) v. Agalianos [1955] HCA 27; (1955) 92 CLR 390 quoting Lord Loreburn in Ball v. William Hunt & Sons Ltd. (1912) AC 496, at pp 499-500 ). Here the claimant's tinnitus has prevented continuation of his chosen career but I do not think it can be said that it makes his labour unsaleable in any market reasonably open to him. His compensation must accordingly be assessed under s. 46 and, as he is in receipt of superannuation, under sub-s. (3) of that section." (at p411)

23. The Tribunal did not in my opinion by these words purport to preclude evidence being subsequently tendered to the effect that the respondent's capacity for work was not saleable in any market place and thus was of no value. This view is to my mind supported by the letter dated 11th November, 1977, from the clerk of the Tribunal to the respondent, a copy of which the appellant received. Although the letter does not necessarily correctly set out the relevant law it does indicate that a determination or finding of partial incapacity for work had not, at least in the view of the clerk of the Tribunal, been made. Part of the letter is as follows: "As I understand it, and I repeat that this is not a lawyer's view nor to be taken as legal advice, what the Tribunal will be seeking to do at the resumed hearing is to determine: (a) whether Mr. Scott is totally incapacitated as a result of both conditions or whether in his present state he is able to earn some income at some other employment; (b) what proportion of the incapacity is due to the work-induced tinnitus and what portion is due to the heart condition; with a view to determining the amount of compensation payable to Mr. Scott under s. 46 of the Act." (at p411)

24. The next submission in support of the first ground of appeal was to the effect that the respondent throughout based his case on his alleged partial incapacity for work and should not be permitted to change his ground without notice to the appellant. Again in my mind there are a number of answers to this submission. If the respondent did so base his case, it was in circumstances where right from the outset his agent acknowledged his lack of expertise in the field covered by the Act. The fact that such a concession was made at the outset should in the present circumstances ensure that any subsequent change of ground did not operate to prejudice the respondent. Moreover, in my view looseness of language can also be attributed to the respondent's agent. It seems to me that the expression "partial incapacity" was again not used correctly, but rather as indicating an acknowledgement that the claimant was physically capable of doing some work. Whether that work had any value was a matter for later consideration. (at p412)

25. Counsel for the appellant further contended that the possibility of total incapacity for work was only introduced at the very last moment by the Tribunal in the reasons for its ultimate determination. In my view this submission is not well founded. The submissions lodged on behalf of the respondent by letter dated 24th August, 1977, before the publication of the Tribunal's September 1977 reasons, foreshadowed at least the possibility that the respondent's residual capacity had no value. The relevant portion of the letter is as follows: "Firstly let me deal with partial incapacitation. The Commonwealth under the Public Service Act s. 67, sub-ss. (1) and (2) have the capacity to deal with officers who are incapacitated and cannot carry out the function of their office. Having dealt with Mr. W. D. Scott under this section one may well construe that they felt Mr. Scott was not capable of carrying out any function, least they may well have offered him alternative employment. The facts of the matter are that Mr. Scott was not able to carry out his duties, not because of some injury which left him incapable mentally or physically, but because of his deterioration in health, due to his injury, was incapable of carrying out any function for the required amount of hours the Commonwealth requires a servant to work. We submit that Mr. Scott was quite capable of carrying out his duties as an airworthiness surveyor, but only for a limited number of hours per day." (at p412)

26. As above mentioned the possibility of a submission of total incapacity for work was raised by the clerk of the Tribunal's letter of 11th November, 1977. The Tribunal reiterated this as a possibility in the early stages of the final hearing, before any evidence was presented and reiterated it specifically in discussion with the appellant's representative. A little later in the hearing, the respondent's agent in outlining the evidence he proposed to call, indicated that it was in reference to the respondent's "ability to earn anything at all". Furthermore, and again before evidence was presented, the respondent's agent indicated that "we would be looking at the situation where Mr. Scott would be totally incapable of holding down any job". (at p413)

27. It is in my view just not correct to say that total incapacity for work was introduced for the first time in the Tribunal's reasons for its final determination, or that the respondent's case was at all times based exclusively on partial incapacity for work (as correctly understood) or that the appellant was in any way prevented from adequately presenting its case through lack of notice. Such a contention was not mentioned at any time during the hearings of the Tribunal. Taking this submission at best for the appellant (and further than was expressly submitted on its behalf) I cannot see any indication that the appellant was denied natural justice in the proceedings. (at p413)

28. The final submission in support of the first ground of appeal was that the Tribunal had misapprehended the effect of Dr. Chew's certificates. Such a submission would only entail an error in law if, upon the certificates being correctly understood, there was no evidence at all to support a finding of total incapacity for work. In my view this submission founders on two grounds. The Tribunal did not misconceive the evidence supplied by the certificates. I accept the respondent's contention that Dr. Chew's certificates should be read in the context of their being prepared for use at the final hearing. And even if the Tribunal did misconceive this evidence there was still other evidence, particularly that of the respondent's colleague Mr. Robinson, upon which it was open for it to make a finding of total incapacity for work. (at p413)

29. The second ground of appeal was that the Tribunal had misdirected itself in respect of the fact that the appellant did not call evidence on the final hearing. As I understand the submission the crux of the complaint is that the Tribunal went as far as to say it drew an adverse inference from the failure of the appellant to put in evidence the medical report it had obtained prior to the hearing. As I said during the hearing, on one view the Tribunal might be seen as overstating the position, in so far as it indicated that it drew an adverse or an unfavourable inference. However, even if such a criticism is valid, it does not avail the appellant to any significant extent. Omitting from consideration altogether this inference which the Tribunal said it drew, there still was evidence upon which to base the ultimate finding. (at p413)

30. Whilst I find the desire of the Tribunal to have all possible evidence before it understandable, in my view both parties must be permitted to present their cases in the way each considers most appropriate. This is particularly so when the Tribunal has itself a right of its own volition to summon a witness (s. 83 (2) (d)) and is specifically directed to give each party a fair opportunity of presenting his case (s.20(2)(b)). For my part I would prefer the approach indicated by Deane J. in Sullivan v. Department of Transport (1978) 20 ALR 323 where his Honour said:
"In the ordinary case, a tribunal which is under a duty to act judicially and which has the relevant parties before it will be best advised to be guided by the parties in identifying the issues and to permit the parties to present their respective cases in the manner which they think appropriate. Circumstances may, of course, arise in which such a statutory tribunal, in the proper performance of its functions, will be obliged to raise issues which the parties do not wish to dispute and to interfere, either by giving guidance or by adverse ruling, with the manner in which a particular party wishes to present his case. Ordinarily, however, in the absence of a request for assistance or guidance by a party who is appearing in person, a tribunal under a duty to act judicially should be conscious of the fact that undue interference in the manner in which a party conducts his case may, no matter how well intentioned, be counter-productive and, indeed, even overawe and distract a party appearing in person to the extent that it leads to a failure to extend to him an adequate opportunity of presenting his case" (1978) 20 ALR, at pp 342-343 . (at p414)

31. However, there is no doubt that in requesting the appellant to put in evidence the report, the Tribunal acted with complete propriety. In Hoggard v. Worsbrough Urban District Council (1962) 2 QB 93 Winn J. said: "Where two parties are in dispute, and it is the obligation of some person or body to decide equitably between the competing claims, each claim must receive consideration and each claimant must be invited - not merely left to take the initiative if he chooses - to put forward the material in the form of documents or accounts which he desires to have considered; and he must be afforded an opportunity of making comment on the material put forward by rival claimants and which the council are proposing to consider" (1962) 2 QB, at p 100 . (at p414)

32. In the present case the preferred approach of the Tribunal in circumstances where there was evidence that the respondent had shortly before the hearing been examined by a medical practitioner nominated by the appellant, would have been to inquire whether the appellant proposed to call the practitioner or to put the report in evidence. The witness not having been called and the report not having been put in, the Tribunal was entitled to conclude that the findings on this examination were not inconsistent with the case as presented by the respondent. The fact that a recent examination did not produce evidence inconsistent with the respondent's case was available to be used as confirmatory of the finding made in reliance on the respondent's evidence. (at p415)

33. Again, on this aspect of the case, in my view there is evidence of some looseness of language on the part of the Tribunal. Admittedly it stated that it would draw an adverse inference but this statement is subsequently qualified. Moreover assuming such an inference to have been drawn, the inference is not essential to the ultimate finding of total capacity of work. Such a finding was open, as I have said, on other evidence, and the exclusion of this adverse inference, assuming it to be correct to see it as the consequence of a mis-direction, does not place in jeopardy, (as an error of law), the Tribunal's ultimate conclusion. (at p415)

34. In my opinion the appeal should be dismissed with costs. (at p415)

ORDER

Appeal dismissed.