FEDERAL COURT OF AUSTRALIA

Comcare v Wuth [2018] FCAFC 13

ORDERS

THE COURT ORDERS THAT:

1.    The appeal is allowed in part.

2.    In the absence of agreement as to the orders otherwise required to give effect to these reasons and/or as to the costs below and on appeal:

(a)    on or before 4pm on Friday 6 April 2018 the parties are to file and serve an outline of written submissions not exceeding 5 pages in length in support of their respective proposed orders; and

(b)    final orders will be determined on the papers without a further oral hearing.

THE COURT NOTES THAT:

3.    The parties are to endeavour in the first instance to agree orders which otherwise give effect to these reasons and as to costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

SIOPIS J:

1    I have had the advantage of reading the draft reasons for judgment of each of Flick J and Perry J. I agree for the reasons given by their Honours that grounds 1, 1A and 2 of the amended notice of appeal be dismissed and that grounds 4, 5 and 6 of the amended notice of appeal be allowed.

Associate

Dated:    3 April 2018

REASONS FOR JUDGMENT

FLICK J:

2    The Respondent to the present appeal is Ms Nicole Wuth. Ms Wuth was at one stage employed as an Executive Level 1 in the Department of Health and Ageing. Thereafter she accepted a voluntary transfer at the same level to what was then the Department of Finance and Administration (the “Department”).

3    In April 2010, Ms Wuth made a claim for compensation under the Safety, Rehabilitation and Compensation Act 1988 (Cth) (the “Act”). That claim was initially rejected by Comcare. Review was sought by the Administrative Appeals Tribunal (the “Tribunal”). Agreement was reached in September 2012 as to the terms of the decision to be made by the Tribunal, including agreement that Comcare was liable to pay compensation to Ms Wuth under s 14 of the Act in respect of “chronic daily headache”.

4    In August 2013, Comcare determined that Ms Wuth’s “normal weekly earnings” for the purposes of s 8 of the Act were 29.4 hours, which is equivalent to 4 days per week. In December 2013, Comcare affirmed that decision. Review by the Tribunal was sought. The Tribunal affirmed Comcare’s decision in December 2015: Wuth and Comcare [2015] AATA 947.

5    The decision of the Tribunal occasioned an appeal to this Court on the part of Comcare. Ms Wuth filed a Notice of Cross-Appeal. In April 2017, a Judge of this Court dismissed Comcare’s appeal and allowed Ms Wuth’s Cross-Appeal: Comcare v Wuth [2017] FCA 433, (2017) 156 ALD 561.

6    Comcare now appeals from the decision to allow the Cross-Appeal. There are essentially three issues before the Court, namely:

    the manner of calculating normal weekly earnings;

    the appropriateness of the Tribunal’s reliance on the American Medical Association’s Guides to the Evaluation of Permanent Impairment (5th Edition) (the “AMA Guides”); and

    whether the Tribunal denied Comcare procedural fairness by the reliance placed upon a particular Chapter (and specifically two tables in that Chapter) in the AMA Guides to which no reference had been made in the evidence or submissions.

7    The appeal is to be allowed. It should nevertheless be noted at the outset that the basis upon which the appeal is to be allowed is by reference to arguments substantially different to those resolved by the primary Judge.

Normal weekly earnings – the facts or the hours agreed to be worked

8    The principal issue canvassed on appeal was the conclusion of the primary Judge that the Tribunal had erred in using 29.4 hours as the “average number of hours worked” rather than the actual hours worked in the two week period prior to the injury that gave rise to the claim. The primary Judge concluded that there “was no basis in the Act on which the Tribunal could ignore that Ms Wuth actually worked more than 36.75 hours in each of the two weeks immediately before [the deemed date of injury] … by ‘having regard to her agreed hours only’ and using 29.4 hours a week instead in performing that statutory calculation in s 8(1)”: at [14]. The calculation, according to the primary Judge, “required the use of the actual hours ‘worked by the employee in … her employment’ in each of the two weeks immediately before the date of the injury”: at [16].

9    Section 19 of the Act requires compensation to be paid to an injured employee if the injury results in incapacity for work. That section sets forth a series of formulae for the calculation of the quantum of compensation payable.

10    Of primary importance to the calculation to be undertaken in the present case was the calculation as to the “normal weekly earnings” of Ms Wuth during the “relevant period”. Those statutory phrases appear in s 8 of the Act, which provides in part as follows:

Normal weekly earnings

(1)    For the purposes of this Act, the normal weekly earnings of an employee (other than an employee referred to in subsection (2)) before an injury shall be calculated in relation to the relevant period under the formula:

{NH x RP}+ A

where:

NH is the average number of hours worked in each week by the employee in his or her employment during the relevant period;

…

11    Section 9 of the Act provides for the identification of the “relevant period”. Section 9(1) provides as follows:

For the purposes of calculating the normal weekly earnings of an employee before an injury, a reference in section 8 to the relevant period is, subject to this section, a reference to the latest period of 2 weeks before the date of the injury during which the employee was continuously employed by the Commonwealth or a licensed corporation.

On the facts of the present case, it was common ground that the “relevant period” was the two week period prior to 27 February 2007.

12    Although the relevance of much of the factual material adduced before the Tribunal was disputed, at least three things were common ground, namely:

    when transferred to the Department, it was expected that Ms Wuth’s medical condition would improve such that she could later work five days per week but that she would commence working 4 days per week. The letter of offer stated that her remuneration would be “pro-rated based on part time hours of 29.4 hours per week”;

    Ms Wuth entered into an Australian Workplace Agreement, cl 2.3 of which provided that she may be granted “Time Off in Lieu (TOIL) … to recognise short term additional hours worked”; and

    for the two weeks period prior to 27 February 2007, Ms Wuth was working more than 36.75 hours a week.

13    With respect to the question of fact as to the hours worked prior to 27 February 2007, the Tribunal stated:

[22]    In late 2006, Ms Wuth worked about four-fifths of a full-time workload. In early 2007, in the lead up to the Budget, she and her colleagues were expected to work longer hours. By February 2007, and during the relevant period, Ms Wuth was working more than 36.75 hours a week—that is, more than a full-time workload. This involved her working long hours for four days a week, and sometimes working 2–3 hours on her “day off” each week. Consistent with her [Australian Workplace Agreement], Ms Wuth was credited with some time off in lieu (TOIL) in recognition of the additional hours that she worked.

But the Tribunal went on to calculate normal weekly earnings, not by reference to 36.75 hours per week, but by reference to 29.4 hours per week. In doing so, the Tribunal summarised Ms Wuth’s arguments as follows:

How should Ms Wuth’s normal hours be determined?

[23]    Ms Wuth says that she was a full-time employee of the Department, even though her employment was subject to part-time arrangements agreed between her and her manager. (I will call this her first argument.) Alternatively, she says that, if she was a part-time employee, she was working at least full-time hours during the relevant period (her second argument). And she says that, even if she was a part-time employee, there was an understanding between her and the Department that she would become a full-time employee when she was well enough to do so—probably by mid-2007 (her third argument). For these reasons, Ms Wuth says that her [normal weekly earnings] should be calculated on the basis that she worked an average of at least 36.75 hours (five days) a week during the relevant period.

In rejecting Ms Wuth’s argument that the calculation should employ the figure of 36.75 hours, the Tribunal concluded in part as follows:

[28]    Ms Wuth’s second argument is that her average number of hours is 36.75 hours (five days) because she worked at least that many hours in each week of the relevant period, even though her agreed hours were fewer. One difficulty with this argument is that, if it is valid—if the actual number of hours worked should be used for the calculation under s 8(1), regardless of the number of agreed hours—that number of hours is not capped at a full-time workload. So, a person working on a full-time basis, with agreed full-time hours, would receive a certain amount of compensation if they worked exactly 36.75 hours in each week, but would receive almost 9% more compensation if they happened to work 40 hours a week during their relevant period, and more than 22% more if they worked 45 hours a week. These would be anomalous results.

[29]    Ms Wuth did not argue that her [normal weekly earnings] should be calculated on the basis of her having worked more than a full-time workload, even though she did work those hours. But it is a corollary of her second argument that her compensation should be calculated having regard to those (extra) actual hours worked. If it is appropriate to calculate her [normal weekly earnings] on the basis of her having worked 36.75 hours a week when her agreed hours were 29.4 then it must also be appropriate to calculate her [normal weekly earnings] on the basis of her having worked more than 36.75 hours. That would also be an anomalous result. Her second argument must fail.

(Footnote Omitted.)

14    The primary Judge disagreed. His Honour concluded that her entitlement to compensation was to be calculated upon the basis that she as a matter of fact worked at least 36.75 hours.

15    In so concluding, his Honour was correct.

Section 8 – a factual inquiry

16    Concurrence is expressed with the conclusion of the primary Judge that the “calculation required by s 8(1) did not use, or require the use of, the agreed hours of employment”: [2017] FCA 433 at [16], (2017) 156 ALD at 567.

17    Before the Tribunal there was no submission made that the hours worked during the “relevant period”, namely the two week period prior to 27 February 2007, should be calculated not by reference to sub-s 8(1) but rather by reference to sub-s 8(5). Section 8(4) and (5), it may be noted, guard against the possibility that recourse to the “relevant period” would give rise to an “arbitrary or plainly unfair outcome”: cf. Comcare v Nicolas [2014] FCAFC 122 at [17], (2014) 225 FCR 369 at 372 per Edmonds, Buchanan and Flick JJ.

18    Confined as the argument was before the Tribunal, Comcare’s submission was essentially that the definition of “NH” appearing in s 8(1) should jettison the phrase “average number of hours worked” and substitute the phrase “agreed number of hours worked”.

19    The reliance placed by Senior Counsel for Comcare upon Nicolas before the primary Judge is, with respect, misplaced. If anything, the decision in that case supports the conclusion of the primary Judge and not the contrary conclusion of the Tribunal. The issue to be resolved in Nicolas was whether it was open to the Tribunal to reject the period of two weeks prior to the injury as the period to be used for the calculation of “normal weekly earnings”. The claimant in that case had only recently returned to work on an agreed graduated return to work program commencing at 12 hours per week and intended to increase to 22.5 hours per week. In the two week period prior to sustaining her injury, the claimant in that case had only worked the agreed 12 hours per week. The Full Court concluded that the Tribunal erred in putting aside the hours worked in that two week period as not “fairly representative” of the hours worked. It was in that factual context that Edmonds, Buchanan and Flick JJ concluded (at 376):

[42]    In that period Ms Nicolas worked all of the hours expected of her for a two-week period. Those hours (and the rate of pay applied to them) gave “the weekly rate at which the employee was being paid in respect of … her employment before the injury”. The importance of that factual circumstance was not altered by the expectation that the hours might increase in the months to come. The task of the AAT was to examine whether the two-week period before the injury on 13 May 2011 was fairly representative of normal weekly earnings pre-injury, not to assess whether those earnings might be expected to increase in the future. Furthermore, if any adjustment was to be made, by selecting a different period, it was necessary to select a period which furnished actual hours and actual rates of pay. Once the period before December 2008 is put aside, there was no other period reasonably available.

If anything, the decision of the Full Court in that case underscores the importance of looking to the facts to determine the “average number of hours worked” rather than to some notional future agreement as to what the hours may be or to some past agreement as to what the hours were originally contemplated to be.

20    In the absence of any reason not to look to the “average number of hours worked” as that phrase is employed in s 8(1) and by reference to the “relevant period” being that determined pursuant to s 9(1), Comcare’s argument must be rejected.

21    During the “relevant period”, which was commonly accepted as being the two weeks prior to 27 February 2007, Ms Wuth worked more than 36.75 hours per week, rather than just the agreed 29.4 hours per week. The primary Judge was correct in concluding that the Tribunal erred in not having regard to the fact that she worked no less than 36.75 hours per week during that period.

A denial of procedural fairness

22    There was no questioning the proposition that the Administrative Appeals Tribunal was obliged to provide procedural fairness to both Ms Wuth and Comcare.

23    That which divided the parties was whether the Tribunal had denied Comcare procedural fairness by reason of the reliance it placed upon Chapter 13 of the AMA Guides and, in particular, Tables 13-2 and 13-3 within that Chapter. On behalf of Ms Wuth, it was contended that Comcare was aware that the decision to be made by the Tribunal was an assessment as to Ms Wuth’s incapacity. Although the medical experts had focussed their attention upon Chapter 18 of the AMA Guides, it remained a matter for the Tribunal to make its own decision upon the basis of the evidence before it – including Chapter 13. On behalf of Comcare, it was contended that at no time was it alerted to the prospect of reliance being placed upon Chapter 13. No express reference had been made to Chapter 13 in either the evidence of any of the witnesses or in submissions by either party before the Tribunal.

24    The reliance placed upon Chapter 13 was evident from the following passage in the Tribunal’s reasons for decision, namely:

[63]    Using clinical judgment to determine the degree of Ms Wuth’s impairment involves comparing the impairment resulting from her headaches to impairment resulting from similar conditions with similar impairment of function in performing activities of daily living.59 The table in the [AMA Guides] for rating impairment of consciousness and awareness assigns 0%–14% impairment (“Class 1”) for “minimal limitation” and 15%–39% (“Class 2”) for “moderate limitation” in performance [sic] activities of daily living.60 The table for rating impairment due to episodic loss of consciousness or awareness assigns 0%–14% impairment (“Class 1”) for a disorder that “limits daily activities” and 15%–29% (“Class 2”) for a disorder that “interferes with some daily activities”.61 Of the conditions for which the [AMA Guides] provides impairment ratings, these are, I believe, the conditions that are most similar to Ms Wuth’s and with the most similar impairment of function in performing activities of daily living. Comparing her impairment with impairment resulting from those two conditions, I think that Ms Wuth’s level of impairment is analogous to the upper end of Class 1 for each condition. It is possible that her impairment is analogous to Class 2 for each condition, but there is not sufficient evidence before me to make such a finding.

Footnote 59 was a reference to the following passage within the AMA Guides, namely:

In situations where impairment ratings are not provided, the [AMA Guides] suggests that physicians use clinical judgment, comparing measurable impairment resulting from the unlisted condition to measurable impairment resulting from similar conditions with similar impairment of function in performing activities of daily living.

Footnotes 60 and 61 were references to Tables 13-2 and 13-3 respectively within Chapter 13. Table 13-2 provides as follows:

Table 13-3 provides as follows:

The Tribunal then concluded as follows:

[64]    Having regard to the medical evidence before me, I make the following finding, on the balance of probabilities: Ms Wuth’s degree of whole person impairment, assessed using clinical judgment, is 14%.

A basis for decision which was not contemplated

25    In curial proceedings, a trial judge may deny procedural fairness to the parties if his decision is made on a different basis to that which was the subject of evidence and submissions: Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208, (2005) 3 DDCR 1. Ipp JA (Mason P agreeing) there referred to some of the authorities and summarised the general principle as follows (at 21):

[78]    These cases illustrate the general principle that although the basis on which the parties conduct a trial does not bind the judge, if the judge contemplates determining the case on a different basis he or she must inform the parties of this prospect so that they have an opportunity to address any new or changed issues that may arise.

[79]    A failure so to inform the parties will ordinarily result in a denial of procedural fairness. A new trial will be ordered if a party is not afforded a fair trial in circumstances where a properly conducted trial might possibly have produced a different result. It will not ordinarily be necessary to lead evidence to prove that the denial of procedural fairness had the potential to affect the outcome; in most cases the facts will speak for themselves.

Such a requirement is but an illustration of the more generally expressed requirement that procedural fairness requires notice to be given of the issues to be addressed: cf. Kioa v West (1985) 159 CLR 550 at 628 to 629 per Brennan J. Procedural fairness may thus be denied where a hearing is conducted on one basis and the decision is reached upon a previously undisclosed basis: cf. Breese Pitt Dixon Pty Ltd v Wyndham City Council [2004] VSC 199, (2004) 21 VAR 154.

26    On one approach, Counsel for Comcare before the Tribunal had his opportunity to be heard – that opportunity extended to addressing the principal basis upon which the hearing had been contested (i.e., Chapter 18) and had the opportunity to address any such other bases of assessment as may have been open upon the evidence. On that approach, Counsel for Comcare had put the Tribunal in the position that if the Tribunal perceived another manner of assessing the evidence which had not been the subject of submissions, it was up to the Tribunal to identify that basis and thereafter afford the parties a further opportunity to adduce such further evidence as may have been perceived to be of relevance to that further basis and to make such further submissions as may have been considered appropriate, directed to the newly identified basis of assessment.

27    So stated, the position in which Counsel for Comcare placed the Tribunal was very much in the position whereby the Tribunal was required to disclose its deliberative processes if it was to avoid being subject to a potential challenge founded upon an alleged denial of procedural fairness. The absence of any general requirement to disclose the deliberative processes of an administrative decision-maker is, of course, well-established: e.g., F Hoffmann-La Roche & Co AG v Secretary of State for Trade and Industry [1975] AC 295 at 369 per Lord Diplock; SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63 at [48], (2006) 228 CLR 152 at 166 per Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ. Any other approach would have the potential to lead to a never ending process of hearings, with each sequential hearing being potentially directed to a new and different issue.

28    On the facts of the present case, however, it is concluded that the Tribunal was required to disclose to the parties the prospect that submissions could helpfully be directed to Chapter 13 and Tables 13-2 and 13-3 and whether those Tables provided a basis upon which an assessment of impairment could be calculated. So much, it is respectfully concluded, follows from:

    the absence of any consideration being given to Chapter 13 by any of the witnesses;

    the very real prospect that evidence of specific relevance to Chapter 13 may well have travelled well beyond the existing evidence had it been known that an assessment under Chapter 13 may have been under consideration;

    the absence of any submissions by either Counsel before the Tribunal being directed to the availability of Chapter 13 as an aid to the assessment of Ms Wuth’s impairment;

    the fact that the criteria for the rating of an impairment and the clinical findings of relevance to Chapter 13 are significantly different to those set forth in Chapter 8 – even upon a lawyer’s reading of those two Chapters; and

    the very real prospect that an assessment of impairment pursuant to Chapter 13 would be a process of assessment which travelled beyond a mere assessment of the existing evidence and a process by which the making of the “correct or preferable” decision would require the decision-maker to travel beyond the existing evidence and would be a process assisted by both further evidence and further submissions.

Although procedural fairness may not require a party to be provided with specific notice and an opportunity to address each and every issue of potential relevance to a decision, the more centrally relevant an issue becomes the greater is the need for a party to be put on notice of an emerging issue which is assuming an importance it may not have assumed at the outset of a hearing. The more so is that the case where it is the decision-maker who seeks to attribute significance to an issue not previously addressed by the parties. One factor tempering the extent to which a decision-maker need avert a party’s attention to a particular matter of significance in order for the party to be given a “fair indication” of the potential relevance of that matter is whether the party is represented: cf. NBNB v Minister for Immigration and Border Protection [2014] FCAFC 39 at [145], (2014) 220 FCR 44 at 80 per Buchanan J. On the facts of the present case, the parties were represented by Counsel – but, on the facts, no indication at all was given as to the potential significance of Chapter 13.

29    The primary Judge rejected an argument founded upon an alleged denial of procedural fairness. But the argument as advanced before this Court seems to have departed very much from the argument resolved by the primary Judge. No objection was taken by Counsel for Ms Wuth to this Court resolving the argument as presently advanced.

30    So advanced, the argument should prevail.

CONCLUSIONS

31    The appeal must be allowed. Any order, however, should be confined to an order remitting the matter to the Tribunal so that the Tribunal can make directions as to the hearing of such further evidence as may be of relevance to an assessment being undertaken pursuant to Chapter 13 and the hearing of further submissions directed to that confined issue.

32    There is presently perceived to be no reason why the Tribunal as previously constituted could not hear any such further evidence and submissions.

33    The parties should be given an opportunity to make further submissions as to costs.

Associate:

Dated: 3 April 2018

REASONS FOR JUDGMENT

PERRY J:

1.    INTRODUCTION

34    On 27 February 2007 the respondent, Ms Nicole Wuth, suffered an injury, being a chronic daily headache, arising out of her employment with the Commonwealth Department of Finance and Administration (the Department). Comcare’s liability to pay compensation under s 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) (the SRC Act) is not in dispute.

35    Comcare appeals against the decision of a judge of the Federal Court dismissing its appeal under s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) from a decision of the Administrative Appeals Tribunal (the Tribunal), and allowing a cross-appeal by Ms Wuth (Wuth (FCA)). The issues before the primary judge concerned the quantum of workers compensation entitlements payable to Ms Wuth by way of incapacity compensation and permanent impairment compensation under the SRC Act.

36    Three issues are raised on the appeal:

(1)    the meaning of Net Weekly Earnings (NWE) in s 8(1) of the SRC Act for the purposes of calculating the quantum of workers compensation entitlements payable to Ms Wuth (Grounds 1, 1A and 2, amended notice of appeal);

(2)    whether the primary judge erred in holding that the Tribunal had power to assess the degree of permanent impairment suffered by Ms Wuth under s 24 of the SRC Act using its own lay “clinical judgment” (Grounds 4 and 5, amended notice of appeal); and

(3)    whether the primary judge erred in finding that the Tribunal did not deny Comcare procedural fairness in assessing, without prior notice, the degree of Ms Wuth’s permanent impairment using its own “clinical judgment” by undertaking a comparison between her impairment and similar conditions with similar impairment by reference to rating Tables 13.2 and 13.3 in the 5th edition of the American Medical Association’s Guides to the Evaluation of Permanent Impairment (AMA5) (Ground 6, amended notice of appeal).

37    I note that Ground 3 was abandoned by Comcare in its written submissions. Furthermore, no submissions were made with respect to Ground 2, save insofar as it was subsumed within Ground 1.

38    For the reasons set out below, the appeal must be allowed on Grounds  4 to 6 of the amended notice of appeal. The appeal is otherwise dismissed.

2.    BACKGROUND

2.1    The decisions by Comcare

39    Section 19 of the SRC Act provides that Comcare is to pay to an employee, who is incapacitated for work as a result of an injury, compensation for each week during which the employee is incapacitated. The relevant statutory formula is set out in s 8 of the SRC Act (quoted below at [44]).

40    On 23 December 2013, Comcare affirmed its decision that Ms Wuth’s NWE calculated under s 8(1) of the SRC Act for the purposes of s 19 should be based on 29.4 hours work per week (or a work week comprising 4 days rather than 5 days), irrespective of the hours actually worked by Ms Wuth (the NWE reviewable decision).

41    Ms Wuth also made a claim on 19 February 2014 under ss 24 and 27 of the SRC Act for compensation for permanent impairment and non-economic loss. However, on 21 March 2014, Comcare decided that it was not liable to pay permanent impairment compensation in respect of a “chronic daily headache” under s 24, and consequently that it was not liable to pay compensation for non-economic loss under s 27 of the SRC Act. Comcare affirmed that determination on 2 July 2014 (the PI reviewable decision).

2.2    The Tribunal’s decision

42    In February and July 2014, Ms Wuth applied to the Tribunal under s 64 of the SRC Act for review of the NWE reviewable decision and PI reviewable decision respectively. The Tribunal made its decision on both applications on 9 December 2015.

43    The Tribunal identified the issues on review at [14] as follows:

•    whether Ms Wuth’s normal hours prior to the injury were 29.4 hours (four days a week) or 36.75 hours (five days a week) — that depends on how her normal hours should be determined under s 8 of the SRC Act, which affects her normal weekly earnings as calculated under that provision; and

•    whether Comcare is liable to pay Ms Wuth compensation for permanent impairment and non-economic loss under ss 24 and 27 of the SRC Act—that depends on:

•    whether she has suffered an injury that has resulted in a permanent impairment; and

•    if so:

•    whether her degree of permanent impairment can be assessed under the approved Guide, or under the AMA 5, or using clinical judgment; and

•    whether her degree of permanent impairment is 10% or more.

2.2.1    The Tribunal’s finding on the NWE issue

44    With respect to the first issue, s 4(1) of the SRC Act defines “normal weekly earnings” to mean the normal weekly earnings of an employee calculated under s 8 of the SRC Act. Section 8(1) in turn provides that:

(1)    For the purposes of this Act, the normal weekly earnings of an employee (other than an employee referred to in subsection (2)) before an injury shall be calculated in relation to the relevant period under the formula:

(NH × RP) + A

where:

NH is the average number of hours worked in each week by the employee in his or her employment during the relevant period;

RP is the employee’s average hourly ordinary time rate of pay during that period; and

A is the average amount of any allowance payable to the employee in each week in respect of his or her employment during the relevant period, other than an allowance payable in respect of special expenses incurred, or likely to be incurred, by the employee in respect of that employment.

45    The Tribunal noted at [15] that “… the values of RP and A are agreed; only the value of NH (Ms Wuth’s normal hours) is in issue.” The value of RP was $42.78 per hour.

46    The Tribunal found that the “relevant period” (defined in ss 4(1) and 9(1) of the SRC Act) was 13 February 2007 to 26 February 2007, that period being “the latest period of 2 weeks before the date of the injury during which the employee was continuously employed” (Tribunal reasons at [16]).

47    The Tribunal noted that Ms Wuth’s evidence was not contested and accepted her as a witness of truth (Tribunal reasons at [17]). Based upon that evidence and the documents, the Tribunal found with respect to her employment with the Department that:

18. In late 2006, Ms Wuth expected that her condition would improve within the following few months to the extent that she would be able to work five days a week. Before she moved to the Department on 27 November 2006, Ms Wuth had a discussion with the manager of the branch into which she was to move (the Branch Manager). The understanding between Ms Wuth and the Branch Manager was that Ms Wuth would commence working for the Department four days a week, and that she would increase her working hours to full-time when she was well enough to do so. She expected that that would be within a few months of commencing. Ms Wuth would not have agreed to the move if there had not been the option of her returning to full-time work.

19. The letter of offer from the Department (dated 9 November 2006) said that Ms Wuth’s remuneration would be “pro-rated based on part time hours of 29.4 hours per week”, which was four-fifths of a nominal full-time working week (36.75 hours). Ms Wuth accepted the offer on 14 November.

20. Ms Wuth entered into an Australian Workplace Agreement (AWA) with the Secretary of the Department. Clause 2.3 of that AWA, headed “Hours of work”, relevantly provided:

You are required to work ordinary hours and such reasonable additional hours as are necessary for the performance of your duties. Your ordinary hours are 36 hours and 45 minutes per week or 7 hours and 21 minutes per day, subject to any part-time arrangements agreed between you and your Manager. If you work part-time your remuneration (salary and any performance bonus) and leave entitlements will be calculated on a pro rata basis, based on the full-time ordinary hours.

Your remuneration includes payment for all hours worked, including reasonable additional hours. The relevant period for the purposes of calculating the average hours you work shall be 12 months.

Time Off In Lieu (TOIL) may be granted by your Manager, in consultation with the General Manager, to recognise short term additional hours worked.

21. Before she moved to the Department, Ms Wuth was working full-time for four days a week, using personal leave for the fifth day. At the Department, her salary was paid on a pro rata basis: four-fifths of a full-time salary. She did not use personal leave for the fifth day as she had done previously.

22. In late 2006, Ms Wuth worked about four-fifths of a full-time workload. In early 2007, in the lead up to the Budget, she and her colleagues were expected to work longer hours. By February 2007, and during the relevant period, Ms Wuth was working more than 36.75 hours a week—that is, more than a full-time workload. This involved her working long hours for four days a week, and sometimes working 2–3 hours on her “day off” each week. Consistent with her AWA, Ms Wuth was credited with some time off in lieu (TOIL) in recognition of the additional hours that she worked.

48    Ms Wuth submitted before the Tribunal that she was a full-time employee of the Department, even though her employment was subject to part-time arrangements agreed between her and her manager, or in the alternative, that there was an understanding that she would become a full-time employee and her hours should be calculated on the basis of the hours she might have worked but for the injury. For these reasons, Ms Wuth submitted that NWE should be calculated on the basis that she worked an average of at least 36.75 hours (5 days) a week during the relevant period.

49    The Tribunal found that Ms Wuth was a part-time employee (albeit with a shared expectation that she would eventually work full-time) who was remunerated consistently on a pro-rata basis, with access to TOIL when she worked more than her agreed part-time hours (Tribunal reasons at [34]). On this basis, the Tribunal agreed with Comcare that Ms Wuth’s NWE should be calculated on the basis that she worked an average of 29.4 hours (4 days) a week during the relevant period (Tribunal reasons at [35]). In so finding, the Tribunal found that it was bound to apply s 8 of the SRC Act without regard to the possibility, or even the probability, that Ms Wuth would have become a full-time employee of the Department if she had not been injured, on the basis of the Full Court decision in Comcare v Nicolas [2014] FCAFC 122; (2014) 225 FCR 369 (Nicolas) (Tribunal reasons at [27]). In that case, the Full Court held that “[t]he task of the AAT was to examine whether the two-week period before the injury… was fairly representative of normal weekly earnings pre-injury, not to assess whether those earnings might be expected to increase in the future”(at [42] (the Court)).

50    Ms Wuth submitted in the further alternative that her average number of hours was 36.75 hours because she worked at least that many hours each week of the relevant period, even though her agreed hours were fewer. That argument was also rejected by the Tribunal. It found that her normal hours should be determined under s 8(1) having regard to her agreed hours only, and not the extra hours that she worked beyond her agreed hours during the relevant period:

31.    Although she was not entitled to overtime, Ms Wuth had access to TOIL when she worked more than her agreed hours. The value of NH in s 8(1) must be determined having regard to the employee’s “ordinary, non-overtime hours”. So, in this review, NH should be determined having regard to Ms Wuth’s agreed hours only, and not those extra hours that she worked beyond her agreed hours during the relevant period. The AWA required that Ms Wuth work those agreed hours and “reasonable additional hours”, for which she would be paid a set salary.

(emphasis added)

51    For these reasons, the Tribunal found that Comcare was correct to calculate Ms Wuth’s NWE on the basis that she worked an average of 29.4 hours a week during the relevant period (Tribunal reasons at [35]).

2.2.2    The Tribunal’s findings on the PI issue

52    With respect to the second issue before the Tribunal, subs 24(1) of the SRC Act provides that, where an injury to an employee results in a permanent impairment, Comcare is liable to pay compensation to the employee in respect of the injury. Where compensation is payable under s 24, Comcare is liable to pay additional compensation for non-economic loss in accordance with s 27.

53    Subsection 4(1) of the SRC Act defines: “impairment” to mean “the loss, the loss of the use, or the damage or malfunction, of any part of the body or of any bodily system or function or part of such system or function”; and “[p]ermanent” to mean “likely to continue indefinitely”.

54    With respect to assessing whether an impairment is permanent, subs 24(2) of the SRC Act provides:

(2)    For the purpose of determining whether an impairment is permanent, Comcare shall have regard to:

(a)    the duration of the impairment;

(b)    the likelihood of improvement in the employee’s condition;

(c)    whether the employee has undertaken all reasonable rehabilitative treatment for the impairment; and

(d)    any other relevant matters.

55    Subsections 24(4) and (5) of the SRC Act require Comcare to determine the degree of an employee’s permanent impairment under the provisions of the approved Guide and to express that degree as a percentage. Where the degree of impairment however is less than 10%, Comcare is not liable to pay compensation under s 24 by virtue of subs 24(7). The approved Guide, namely, the Guide to the Assessment of the Degree of Permanent Impairment, is a legislative instrument binding on Comcare and the Tribunal by virtue of subs 28(4) of the SRC Act. The applicable version of the approved Guide was edition 2.1 (Tribunal reasons at [45]).

56    In assessing permanent impairment, the Tribunal took into account several medical reports, including from Associate Professor Owen White, a neurologist, on which Ms Wuth relied, and Dr Janaka Seneviratne, a consultant neurologist and clinical neurophysiologist, on which Comcare relied (Tribunal reasons at [39]-[40] and [58]). Based upon the medical evidence, the Tribunal found that Ms Wuth had suffered an injury which was contributed to in a significant degree by her employment and resulted in a permanent impairment for the purposes of s 24(1) of the SRC Act (Tribunal reasons at [42]-[43]).

57    The Tribunal found that, as Ms Wuth’s claim was not defence-related, only Part 1 of the approved Guide applied (Tribunal reasons at [46]-[48]). However, the Tribunal found at [48] that Part 1 did not deal with migraines or headaches and, as Ms Wuth and Comcare agreed, “her impairment cannot be assessed in accordance with the provisions of Part 1. The tables do not provide a meaningful and clinically reliable answer” (citing Farrell v Comcare [2015] FCA 1337 at [46] (Flick J)).

58    The Tribunal then set out the parties’ contentions as to the applicability of the AMA5 as follows:

50. Ms Wuth says that the AMA 5 does not provide impairment ratings for her condition. …

Accordingly, Ms Wuth says, the degree of her whole person impairment should be assessed using clinical judgment. She says that that would result in an assessment of at least 10% impairment, which would mean that Comcare is liable to pay her compensation under s 24 of the SRC Act.

51. Comcare says that Ms Wuth’s impairment can be assessed under the AMA 5, so clinical judgment is not to be used. Comcare says that, applying the AMA 5, Ms Wuth’s degree of impairment is no more than 3%, so Comcare is not liable to pay her compensation under s 24.

59    Specifically, Comcare submitted before the Tribunal that Ms Wuth’s impairment should be assessed under Chapter 18 of the AMA5, which included a protocol for assessing pain related impairment pursuant to which an examiner may award quantitative pain related impairment subject, in Comcare’s submission, to a cap of 3%.

60    The Tribunal accepted at [57] that “Ms Wuth’s impairment is of a kind that cannot be assessed in accordance with the provisions of Part 1 of the approved Guide, and the AMA 5 does not provide impairment rating for her condition. The degree of Ms Wuth’s whole person [i]mpairment must be assessed (as the AMA 5 suggests) using clinical judgment.”

61    The Tribunal then noted that Associate Professor White was of the view that in the absence of any other applicable table, it would be tenable to assess Ms Wuth with a whole person impairment of 10% under Table 12.5.3 of Part 1 of the approved guide, which is about the trigeminal nerve. Associate Professor White’s evidence was that it might also be possible to apply Chapter 18 of the AMA5. On this basis Associate Professor White assessed Ms Wuth’s impairment class as moderate (Tribunal reasons at [60]). Dr Seneviratne considered that the approved guide was not applicable to Ms Wuth and instead applied Chapter 18 of the AMA5, arriving at an impairment class of mild. Dr Seneviratne’s calculation of this assessment was corrected in closing submissions before the Tribunal, with the result that his evidence was also that the proper impairment class was moderate (Tribunal’s reasons at [61]).

62    The Tribunal however found that neither the approved Guide nor the AMA5 could be used to assess the degree of Ms Wuth’s impairment. In the critical passage of its reasons, the Tribunal found:

63. Using clinical judgment to determine the degree of Ms Wuth’s impairment involves comparing the impairment resulting from her headaches to impairment resulting from similar conditions with similar impairment of function in performing activities of daily living. [FN59] The table in the AMA 5 for rating impairment of consciousness and awareness assigns 0%–14% impairment (“Class 1”) for “minimal limitation” and 15%–39% (“Class 2”) for “moderate limitation” in performance activities of daily living. [FN60] The table for rating impairment due to episodic loss of consciousness or awareness assigns 0%–14% impairment (“Class 1”) for a disorder that “limits daily activities” and 15%–29% (“Class 2”) for a disorder that “interferes with some daily activities”. [FN61] Of the conditions for which the AMA 5 provides impairment ratings, these are, I believe, the conditions that are most similar to Ms Wuth’s and with the most similar impairment of function in performing activities of daily living. Comparing her impairment with impairment resulting from those two conditions, I think that Ms Wuth’s level of impairment is analogous to the upper end of Class 1 for each condition. It is possible that her impairment is analogous to Class 2 for each condition, but there is not sufficient evidence before me to make such a finding.

63    Footnote 59 above referred to the passage in the AMA5 which is quoted below at [94], while footnotes 60 and 61 referred to Tables 13.2 and 13.3 respectively of the AMA5.

64    The Tribunal concluded that:

64. Having regard to the medical evidence before me, I make the following finding, on the balance of probabilities: Ms Wuth’s degree of whole person impairment, assessed using clinical judgment, is 14%.

65    In making this finding, the Tribunal noted at [65] that:

Even though the reports of Associate Professor White and Dr Seneviratne are of limited assistance in determining the degree of Ms Wuth’s whole person impairment, this finding is not inconsistent with those reports. Associate Professor White concluded that the degree of impairment was 10%, impermissibly applying Table 12.5.3 of Part 1 of the approved Guide. Dr Seneviratne, in his first report, said that Ms Wuth’s impairment had “adverse effects on her lifestyle, day-to-day life and work capacity” and that she had “no work capacity for pre-injury duties”

66    The Tribunal also noted at [65] that the fact that Ms Wuth is incapacitated for work is consistent with a finding of a degree of impairment of at least 14% and that, while Part 2 of the approved Guide only applies to defence-related claims and not to the present claim, the finding made by the Tribunal was consistent with the application of the approved Guide to defence-related claims for similar conditions.

2.3    The decision of the primary judge

67    By a notice of appeal filed in the Federal Court on 5 January 2016, Comcare appealed the PI reviewable decision on a question of law under s 44 of the AAT Act. Comcare identified several questions of law, namely, whether the Tribunal had misconstrued Chapter 18 of the AMA5, misconstrued and misapplied the clinical judgment impairment evaluation method provided by the AMA5, denied Comcare procedural fairness, and taken into account irrelevant considerations.

68    Ms Wuth cross-appealed the Tribunal’s decision affirming the NWE reviewable decision.

69    The primary judge upheld Ms Wuth’s cross-appeal, holding that the Tribunal erred in failing to use 36.75 hours as the actual average number of hours worked to calculate Ms Wuth’s NWE, in accordance with s 8(1) of the SRC Act (Wuth (FCA) at [27]). In this regard, his Honour found that there was no dispute that Ms Wuth was paid for only 29.4 hours work a week, including in the relevant period; nor that she did not expect to be paid for the extra hours above 29.4 hours per week that she worked during the relevant period, but rather expected to receive TOIL (Wuth (FCA) at [23]-[24]).

70    Nonetheless, the primary judge held that NWE referred to the actual number of hours which Ms Wuth worked in the relevant period, being 36.75 hours, for the following reasons:

25. … the only applicable provisions in the SRC Act on which to calculate Ms Wuth’s normal weekly earnings were those in ss 8(1) and 9(1). Those provisions referred not to the hours in the relevant period for which she was paid in money, but to the hours that she actually worked. The fact that Ms Wuth was content to take consideration for her labour in the form of leave (time off in lieu) for the additional hours that she worked did not mean that the statutory calculation of her normal weekly earnings could be performed by only using the 29.4 hours for which she received monetary consideration particularly in circumstances where she also received consideration in the form of TOIL.

26. The NH figure in s 8(1) applies to facts, not hypotheses. The only relevant fact that the Tribunal needed in order to ascertain the NH value in s 8(1) was the actual average number of, namely, more than 36.75, hours a week that Ms Wuth worked in the relevant two week period. In her notice of cross-appeal Ms Wuth only sought a finding that the NH figure be 36.75 hours per week based on the Tribunal’s finding that in fact she worked in excess of that time during each of the two weeks in the relevant period. Accordingly, that figure should be used as the NH value in calculating her normal weekly earnings under s 8(1).

71    Comcare’s appeal against the PI decision was, however, dismissed by the primary judge.

72    First, the primary judge found that it was open to the Tribunal to find that Ms Wuth’s pain related impairment was unrateable under Chapter 18 of the AMA5 (Wuth (FCA) at [56]). His Honour considered that Chapter 18 contemplated that a qualitative assessment or rating can be made for a person who has only a pain related impairment which is not limited to a cap of 3%, and held that Comcare’s argument to the contrary would lead to an “unreasonable and arbitrary result” (Wuth (FCA) at [66]). A challenge to these findings by Comcare in Ground 3 of the amended notice of appeal was ultimately abandoned. His Honour then found that:

67. Properly understood, the purpose of Ch 18 was to provide a qualitative assessment methodology that decision makers could use as a reasonable basis for awarding compensation, including where that depended, as under ss 24(6) and 28(4) of the SRC Act, on attributing a percentage for permanent impairment. The lay decision maker could form his, her or its own opinion as to the appropriate percentage, guided by the medical assessment, in accordance with Ch 18, of the qualitative degree and manifestation of any pain-related impairment.

73    Furthermore, his Honour found that:

76. …the approved Guide’s reference to the AMA Guides for assessment of conditions of migraine or tension headaches, having regard to the principles of policy, consistency and fairness to which Dixon CJ referred in Commissioner for Railways (NSW) v Agalianos (1995) 92 CLR 390 at 397, was intended to result in a principled qualitative, not quantitative, assessment (at least in cases where no organ or body part dysfunction was involved) on which an administrative decision maker, such as Comcare or the Tribunal, could act in accordance with s 28(4) of the SRC Act to assign a percentage under s 24(6) based on a lay “clinical judgment”.

(emphasis added)

74    For those reasons, the primary judge found that the Tribunal did not misconstrue Chapter 18. His Honour then concluded with respect to Ground 3 of the appeal that:

78. In that context, the Tribunal was entitled to use its own “clinical judgment” or make its own assessment in accordance with Ch 18, including Step VIII in [18.3d] and Step 6 in [18.5]. The Tribunal needed no medical qualifications to do [so]. It was performing the administrative function of using the qualitative assessments by Assoc Prof White and Dr Seneviratne to arrive at its own assessment of a percentage amount of Ms Wuth’s permanent impairment in accordance with ss 24(6) and 28(4) of the SRC Act. Ground (3) also fails.

75    Finally, the primary judge rejected the proposition that Comcare had been denied any procedural fairness. In this regard, his Honour found that Comcare knew that:

(1)    both of the medical experts had opined that Ms Wuth could not be assigned a percentage whole person impairment under the approved Guide or AMA Guides for her chronic migrainous headache pain-related impairment (Wuth (FCA) at [79]);

(2)    Chapter 18 of the AMA5 provided for such a situation by requiring an examiner (or, as in this case, qualified experts who gave evidence) to perform a qualitative assessment of a person’s pain related impairment when that impairment could not be rated quantitatively “so that administrative agencies can make informed decisions about whether or not to compensate these individuals” (Wuth (FCA) at [79]); and

(3)    the Tribunal stood in Comcare’s decision-making “shoes” and was required to give the correct and preferable decision on the medical evidence before it (Wuth (FCA) at [80]).

76    His Honour found that:

81    Comcare knew all of this at the hearing in which the Tribunal had to exercise its decision-making function to decide Ms Wuth’s application for compensation under s 24. How Comcare could say that it did not have the opportunity to put its case as to what Ms Wuth should be awarded is shrouded in mystery. Comcare submitted to the Tribunal that she should get nothing because of its contention that the maximum percentage available was 3% and, since that was below the 10% minimum in s 24(7), her claim had to fail. Comcare knew that none of the doctors whose reports were in evidence had ascribed a percentage for her degree of impairment, but that was what Ms Wuth wanted the Tribunal to do.

82    There was no evidence from any officer of Comcare that it understood that the Tribunal was not engaged in a hearing of Ms Wuth’s whole claim for a decision under s 24, including under ss 24(6) and 28(4). Ms Wuth’s counsel asked the Tribunal in final submissions to make a clinical judgment. It had power under s 33(1)(c) of the AAT Act to do so, by informing “itself on any matter in such manner as it thinks appropriate”. Comcare had the opportunity of being heard on the substantive issue. It did not put to the Tribunal that it should not do as counsel for Ms Wuth had sought.

83    The Tribunal’s function in that context was to make a decision about the ultimate question that it had to resolve, namely what percentage should it assign under ss 24(6) and 28(4)…

77    Nor, his Honour found, had Comcare shown any practical injustice. Comcare had led no evidence as to what it might have done “had it somehow not appreciated that the role of the Tribunal was to make the very decision that ss 24(6) and 28(4) required it to make.” (Wuth (FCA) at [83]). Moreover, his Honour found that “the Tribunal was not using ‘clinical judgment’ as an expert medical practitioner. It was using the evidence before it, including the expert evidence, to make the evaluative administrative decision where the approved Guide and the AMA Guides did not provide a quantitative value or range of values for determining the percentage degree of Ms Wuth’s permanent impairment under s 24(6)” (Wuth (FCA) at [84]).

3.    DISPOSITION OF THE APPEAL

3.1    Grounds 1, 1A and 2: construction of NWE in s 8(1) of the SRC Act

78    It was not in issue that TOIL constitutes paid days off for working extra hours over the 24.9 hours that it was agreed Ms Wuth would work. As such, TOIL was earned for hours that Ms Wuth in fact worked, and was not paid in advance. As counsel for Ms Wuth submitted, by working extra hours, Ms Wuth earned time off with pay for those hours. There was, in Ms Wuth’s submission, no warrant for saying that she ought not be compensated for the loss of TOIL under the beneficial scheme created by the SRC Act. Thus, in Ms Wuth’s submission, the extra hours worked by her beyond those agreed counted as hours worked for the purposes of calculating NWE under s 8(1) of the SRC Act. (I note that no issue was taken with Comcare’s submission that Ms Wuth was ineligible to receive overtime, and no submissions were made as to how the relevant provisions might apply where an employee was entitled to elect between receiving TOIL or overtime for extra hours worked.)

79    Comcare, however, submitted that, properly construed, the reference in s 8(1) of the SRC Act to the average number of hours worked was a reference to the average number of hours worked by the employee for which she or he was paid. In support of this construction, Comcare relied upon a number of contextual considerations.

(1)    First, the formula in s 8(1) of the SRC Act is used to calculate NWE for the purposes of the periodic calculation under s 19 of the SRC Act. NWE in other words was said to be the “index” by reference to which the amount of compensation is calculated. In Comcare’s submission, given that this is the function of calculating NWE, it would make no sense to include hours in the component “NH” where the employee had no entitlement to remuneration, referring by analogy to the calculation of overtime.

(2)    Secondly, Comcare relied upon s 8(5) of the SRC Act as supporting its construction. It submitted that this provision provided an “escape clause” in circumstances where calculating NWE by reference to the preceding two weeks before the injury “would not fairly represent the weekly rate at which the employee was being paid in respect of his or her employment before the injury…”. In particular, the focus in subs (5) on the weekly rate “being paid” was, in Comcare’s submission, a further reason for construing “NH” in s 8(1) as a reference to paid hours of work.

80    The narrow construction of NWE in s 8 of the SRC Act for which Comcare contends should not be accepted.

81    Under established principles the starting point in the task of statutory construction is the legislative text. As Hayne, Heydon, Crennan and Kiefel JJ explained in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41; (2009) 239 CLR 27 (Alcan) at [47] “[t]he language which has actually been employed in the text of legislation is the surest guide to legislative intention”. Comcare’s construction lacks support in the statutory text, seeking to write words into s 8(1) of the SRC Act which do not appear. Thus, as Ms Wuth submitted, whereas s 8(1) simply provides that “NH is the average number of hours worked in each week by the employee in his or her employment during the relevant period”, Comcare would add the qualifier “for which the employee received payment in money” or, alternatively, substitute the word “average” for the word “agreed”. In so doing, Comcare seeks in my view to fill gaps perceived by Comcare in the legislation and to press a construction too much at odds with the words that the Parliament has chosen: Taylor v The Owners - Strata Plan No 11564 [2014] HCA 9; (2014) 253 CLR 531 at [38] (French CJ, Crennan and Bell JJ).

82    Equally, the rate of pay (RP) is simply defined in s 8(1) as “the employee’s average hourly ordinary time rate of pay during [the relevant] period”. As such, contrary to Ground 1A of Comcare’s amended notice of appeal, it does not follow from accepting that “NH” represents an average of the actual hours worked by Ms Wuth that “RP” must be “reduced in direct proportion to any increase in NH, with the result that her [NWE] would be the same whether one used 29.4 hours or 36.75 hours (or some other figure) as NH.” On a natural reading of the definition, “RP” is a fixed item. To read “RP” otherwise is again to read words into the section which do not appear. In this case, the ordinary rate of pay in the equation provided for by s 8(1) was fixed at $42.87 per hour (as evidenced by Ms Wuth’s payslip for the pay period 22 February 2007 to 7 March 2007).

83    Furthermore, the purpose of the formula in subs 8(1) is to provide a means of assessing compensation by reference to the employee’s average hourly ordinary time rate of pay multiplied by their average working hours during a two week period immediately before the injury. To this is added under s 8(2), compensation at the average hourly overtime rate of pay over the relevant period where the employee “is required to work overtime on a regular basis”. In so providing, the Parliament has created a formula that is likely, in practical terms, to be easily applied (subject to the capacity to depart from the formulas in limited circumstances), as opposed to a more nuanced approach which might result in a more accurate assessment of compensation in the individual case. That being so, it still remains the case that the purpose of the formula, when read with s 19, is to ensure a measure of compensation which approximates the loss occasioned by a worker through injury. In those circumstances, where accuracy may be supplanted by simplicity, the purpose of the provision is not furthered by adopting either gloss upon the words enacted by the Parliament for which Comcare contends, and thereby confining the operation of the formula by reading in words which Parliament has not seen fit to include. While I would not put the position as broadly, nonetheless the statement by Burchett J in Brennan v Comcare (1994) 50 FCR 555 at 561 with respect to the SRC Act, that “[i]t would be impossible, in construing beneficial legislation, to reject the literal effect in favour of restricting the availability of the benefits”, lends some further support to the construction which I prefer. This is not a case where construing the Act beneficially would strain the language of the provision or take no account of its context: Comcare v Pires [2005] FCA 747; (2005) 143 FCR 104 (Pires) at [47] (Jacobson J) (referring to Bull v Attorney-General (NSW) (1913) 17 CLR 370 at 384 (Isaacs J)).

84    Nor, in my view, is Comcare’s construction assisted by reference to subs 8(4) and (5) of the SRC Act. Subsection (4) applies only where the shortness of the relevant period means that it is “impracticable” to calculate NWE by reference to the relevant period and the formula in subs (1) and (2). Subsection (5), in turn, applies where the shortness of the relevant period means that calculating NWE by reference to that period would not “fairly represent” average weekly earnings, such as where for example an employee is injured only 5 days after commencing work. As such, “[s]ection 8(4) and (5) guards against any arbitrary or plainly unfair outcome arising from the operation of s 9(1) [defining the ‘relevant period’]”: Nicolas at [17] (the Court). It cannot be inferred from that exceptional purpose that the reference in subs 8(5) to “being paid” should govern the construction of the general rule in s 8(1) of the SRC Act. I also agree with the reasons of Flick J at [19] (which I have read in draft) as to why the decision in Nicolas does not otherwise assist Comcare’s construction.

85    Finally, while the Tribunal relied by analogy at [30] upon the decision in Pires in support of its construction, that decision is distinguishable. In Pires, Jacobson J held that overtime which was not required or regular should not be factored into the calculation under s 8(1) of the SRC Act. However, that decision turned upon his Honour’s construction of s 8(2) of the SRC Act as making exclusive provision for the circumstances in which NWE was to include an amount for average overtime payments over the relevant period (Pires at [37] – [43]).

86    It follows that no error has been established in the primary judge’s construction of NWE in s 8 of the SRC Act and therefore in the finding that the Tribunal erred in not having regard to the fact that Ms Wuth worked no less than 36.75 hours during the relevant period. Grounds 1, 1A and 2 of the amended notice of appeal must be dismissed.

3.2    Grounds 4, 5 and 6: the Tribunal’s application of the “clinical judgment” impairment evaluation method in Section 1.5, the AMA5 Guide

87    It will be recalled that Grounds 4 and 5 of the amended notice of appeal allege that the Tribunal misconstrued the “clinical judgment” impairment evaluation method, and lacked power to assess the degree of permanent impairment suffered by Ms Wuth using its own (lay) “clinical judgment”. Ground 6 raises the question of whether, in so doing, the Tribunal acted in breach of procedural fairness. As to the latter, it was rightly not in issue that the Tribunal was required to comply with the requirements of procedural fairness. That said, the precise content to be given to the requirement to accord procedural fairness and the question of whether it has been breached will depend upon the facts and circumstances of the particular case, including the relevant statutory framework: SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs [2006] HCA 63; (2006) 228 CLR 152 (SZBEL) at [26] (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ).

88    Before turning to consider these grounds, I note that, both before the Tribunal and the primary judge, Comcare’s arguments regarding Chapter 18 of the AMA5 and the application of Section 1.5 were intertwined. It was therefore in the context of finding that Chapter 18 of the AMA5 was intended to result in a principled qualitative (and not a quantitative) assessment, and that the Tribunal had therefore not misconstrued Chapter 18 of the AMA5, that the primary judge found that the Tribunal was entitled to use its own “clinical judgment” to assess Ms Wuth in accordance with Chapter 18 of the AMA5 (Wuth (FCA) at [76] – [79]). On appeal Comcare abandoned its argument regarding Chapter 18 of the AMA5. As a consequence, the argument regarding the Tribunal’s application of “clinical judgment” assumed a different emphasis on the appeal from that before the primary judge.

89    Section 28(1) of the SRC Act provides that Comcare may prepare a Guide to the Assessment of the Degree of Permanent Impairment setting out:

(a)    criteria by reference to which the degree of the permanent impairment of an employee resulting from an injury shall be determined;

(b)    criteria by reference to which the degree of non-economic loss suffered by an employee as a result of an injury or impairment shall be determined; and

(c)    methods by which the degree of permanent impairment and the degree of non-economic loss, as determined under those criteria, shall be expressed as a percentage.

90    A Guide prepared under subs (1) or a variation or revocation of such a guide under subs (2) must be approved by the Minister and is a legislative instrument once so approved (subs 28(3) and (3A) of the SRC Act). Section 28(4) of the SRC Act provides that:

Where Comcare, a licensee or the Administrative Appeals Tribunal is required to assess or re-assess, or review the assessment or re-assessment of, the degree of permanent impairment of an employee resulting from an injury, or the degree of non-economic loss suffered by an employee, the provisions of the approved Guide are binding on Comcare, the licensee or the Administrative Appeals Tribunal, as the case may be, in the carrying out of that assessment, re-assessment or review, and the assessment, re-assessment or review shall be made under the relevant provisions of the approved Guide.

(emphasis added)

91    The use of the word “shall” makes it clear that applying the relevant provisions of an approved Guide is a mandatory obligation imposed upon Comcare and the Tribunal.

92    Under the heading “Principles of Assessment” in Part 1 of the approved Guide, Principle 12 provides that:

In the event that an employee’s impairment is of a kind that cannot be assessed in accordance with the provisions of Part 1 of this guide, the assessment is to be made under the American Medical Association’s Guides to the Evaluation of Permanent Impairment 5th edition 2001.

An assessment is not to be made using the American Medical Association’s Guides to the Evaluation of Permanent Impairment for:

…

chronic pain conditions, except in the case of migraine or tension headaches..…

Any reference in this guide to the American Medical Association’s Guides to the Evaluation of Permanent Impairment is a reference to the 5th edition 2001.

93    By operation of s 14(1)(b) of the Legislation Act 2003 (Cth), as then in force, the effect of Principle 12 of the approved Guide is, relevantly, to incorporate without modification the AMA5 to cases of migraine or tension headaches. As such, as Comcare submitted, the AMA5 binds Comcare and the Tribunal in the same way as if it were a part of the approved Guide.

94    Relevantly, as earlier explained, Section 1.5 of the AMA5 provides that:

In situations where impairment ratings are not provided, the Guides suggests that physicians use clinical judgment, comparing measurable impairment resulting from the unlisted condition to measurable impairment resulting from similar conditions with similar impairment of function in performing activities of daily living.

95    In “suggest[ing]” that physicians use clinical judgment, it is plain from the context that the text is not suggesting that others might use clinical judgment, but is rather a suggestion to physicians as to how they might undertake the necessary comparison in situations where no impairment ratings are provided. As such, as Comcare submits, the AMA5 permitted only a physician to use clinical judgment, and did not permit the decision-maker independently in the absence of any expert evidence to compare the unlisted condition with an allegedly similar impairment that was measurable.

96    Comcare also submitted that the Tribunal had acted in breach of procedural fairness in undertaking this comparison independently of any expert evidence. In this regard, while Ms Wuth submitted before the Tribunal that it should exercise its own clinical judgment, and indeed the Tribunal understood that the use of clinical judgment was opposed by Comcare (Tribunal reasons at [50] - [51] (quoted at [58] above)). It was not in issue that none of the medical practitioners had given evidence on any comparison between Ms Wuth’s condition and Tables 13.2 and 13.3 of the AMA5, despite the Tribunal ultimately undertaking this exercise. Nor did Ms Wuth submit before the Tribunal that the clinical judgment which she urged the Tribunal to undertake should be done by reference to these tables. Furthermore, the Tribunal is not a specialist tribunal comprised of experts in the medical field; nor was there any requirement that the Tribunal be constituted by an expert in the relevant field in the present case. In those circumstances, Comcare’s submission that the Tribunal acted in breach of the requirements of procedural fairness should be accepted.

97    In this regard, as Comcare submitted, the case is similar to that in Rodriguez v Telstra Corporation Ltd [2002] FCA 30; (2002) 66 ALD 579 (Rodriguez). In that case, the Tribunal had found that by September 1998 Mr Rodriguez’s depressive disorder had ceased to be applicable to his employment, and was no longer an “injury” under the SRC Act. Mr Rodrigues submitted that the Tribunal, in so concluding, had substituted its own opinion for that of the medical experts or, put another way, the Tribunal’s conclusion was unsupported by any evidence. In upholding the appeal, Kiefel J found that no medical expert had expressed the opinion arrived at by the Tribunal and none of the medical experts were questioned on the factual basis which underpinned the Tribunal’s opinion (Rodriguez at [21]-[22]). Justice Kiefel also referred to the fact that the applicant tended to camouflage his depression, which in turn highlighted the complexity of the task as one requiring expert psychiatric evaluation (Rodriguez at [22]). Her Honour held that, “if a view is formed by a Tribunal which goes beyond the opinions expressed by the experts in evidence, fairness requires that it be disclosed and the parties permitted an opportunity to address it” (Rodriguez at [24]). This is so irrespective of whether the Tribunal member is medically qualified (Rodriguez at [24]).

98    Further, while accepting that the Tribunal is not bound by the rules of evidence and may inform itself as it thinks fit, her Honour held this does not mean that the rules of evidence are to be ignored. Rather, her Honour held that:

25. ….The more flexible procedure provided for does not justify decisions made without a basis in evidence having probative force: Pochi v Minister for Immigration and Ethnic Affairs (1979) 36 FLR 482, 492, referring to Consolidated Edison Co v National Labour Relations Board (1938) 305 US 197, 229; The King v War Pensions Entitlement Appeal Tribunal; Ex parte Bott (1933) 50 CLR 228, 256. The drawing of an inference without evidence is an error of law: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321, 355-356; Repatriation Commission v Maley (1991) 24 ALD 43 (Full Court). Similarly such error is shown when the Tribunal bases its conclusion on its own view of a matter which requires evidence. In Collector of Customs (Tasmania) v Flinders Island Community Association (1985) 60 ALR 717, 722 a Full Court of this Court held that it was unjustifiable, and therefore legally erroneous, for a Tribunal to base its conclusion upon its own understanding of traditional aboriginal concepts of community ownership and interests, in the absence of any evidence on the matter.

26. It may be said that expert evidence is sometimes over-utilised and is called in situations where an arbiter of fact is in a position to determine the matter for itself. Sometimes all that is necessary is for a method or process to be explained, so that the Court or Tribunal can then apply it to the facts it finds. On the other hand, there are cases where a whole question is, in effect, relegated to experts to give evidence upon it. This was such a case. The Tribunal was not put in a position where it could simply draw its own inferences. In an area which required an understanding of a disorder it could only receive the opinions, have the bases for them explained if they differed and apply logic to determine which were to be accepted.

99    Equally, it is plain that the Tribunal fell into error here in basing its conclusion at [64] as to the appropriate comparison upon its own views, when that was a matter requiring expert evidence. Not only in this regard does Section 1.5 of the AMA5 suggest that physicians use clinical judgment to undertake the relevant comparisons, but immediately thereafter Section 1.5 of the AMA5 explains that:

The physician’s judgment, based upon experience, training, skill, thoroughness in clinical evaluation, and ability to provide the Guides criteria as intended, will enable an appropriate and reproducible assessment to be made of clinical impairment. Clinical judgment, combining both the “art” and “science” of medicine, constitutes the essence of medical practice.

100    In those circumstances, as Comcare submitted, it was incumbent upon the Tribunal to follow an approach akin to that agreed between the parties on appeal and ordered by the Court in Riley v Comcare [2011] AATA 674 and applied in Roxas v Comcare [2012] AATA 747, namely, that:

(i)    having determined that there was no applicable Table for the applicant’s impairment, the Tribunal should have referred to the Principles of Assessment in Part 1 of the Guide;

(ii)    those Principles provide that in the event that an employee's impairment is of a kind that cannot be assessed in accordance with the provisions of Part 1 of the Guide, the assessment is to be made under the edition of the AMA Guides;

(iii)    the AMA Guides provide that “in situations where impairment ratings are not provided, the Guides suggest that physicians use clinical judgement comparing measurable impairment resulting from the unlisted condition to the measurable impairment resulting from similar conditions with similar impairment of function in performing activities of daily living”;

(iv)    accordingly, if the tribunal is satisfied that neither guide provides a specific means by which the impairment can be assessed, the tribunal should consider evidence from doctors as to the degree of impairment suffered based on their clinical judgement (informed by considering the degree of impairment resulting from similar listed conditions in the relevant edition of the AMA Guides).

101    It is plain that the comparison between Tables 13.2 and 13.3 was ultimately a critical issue in the Tribunal’s decision. However, it was not raised by the Tribunal in advance of its decision. Nor was sufficient notice given merely by an open-ended submission by Ms Wuth, made without reference to Tables 13.2 and 13.3, that the Tribunal may undertake its own clinical evaluation (see above at [58]). Equally the cryptic reference to the issue at [8.3] of Ms Wuth’s submissions to the Tribunal was insufficient to give fair notice to Comcare. As such, Comcare was not afforded an opportunity to address or lead evidence on any new or changed issues arising by reason of the different basis on which the Tribunal ultimately decided the application. Yet, as McHugh J, for example, stated with respect to the rules of procedural fairness in Minister of State for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 311-312 (in dissent but in a passage approved by McHugh and Gummow JJ in Re Minister for Immigration and Multicultural and Indigenous Affairs; ex parte Lam [2003] HCA 6; (2003) 214 CLR 1 at [81]-[83] (Lam)):

In the absence of a clear contrary legislative intention, those rules require a decision-maker ‘to bring to a person’s attention the critical issue or factor on which the administrative decision is likely to turn so that [she or] he may have an opportunity of dealing with it.

See also e.g. Kioa v West (1985) 159 CLR 550 at 587 (Mason J); Saeed v Minister for Immigration and Citizenship [2010] HCA 23; (2010) 241 CLR 252 at [19] (French CJ, Gummow, Hayne, Crennan and Kiefel JJ); SZBEL at [25]–[32] (Gleeson CJ, Kirby, Hayne, Callinan and Heydon JJ); and SZSSJ v Minister for Immigration and Border Protection (No 2) [2015] FCAFC 125; (2015) 234 FCR 1 at [118] (Rares, Perram and Griffiths JJ); see also, by analogy, Seltsam Pty Ltd v Ghaleb [2005] NSWCA 208 (Seltsam) at [78] – [79] (Ipp JA (with whose reasons Mason P agreed at [2])).

102    It follows that the Tribunal should have advised the parties that it was concerned that the appropriate comparison should be undertaken by reference to Tables 13.2 and 13.3, and afforded them the opportunity to make submissions and lead expert medical evidence on the appropriateness of that comparison under the AMA5.

103    For these reasons, the primary judge, with respect, fell into error in finding that there was no breach of procedural fairness by the Tribunal.

104    Furthermore, I respectfully disagree with the primary judge’s findings at [84]. Contrary to his Honour’s view, I consider that no further evidence was required in order for Comcare to establish that the breach of procedural fairness resulted in a practical injustice: Lam at [37] - [38] (Gleeson CJ), [122] (Hayne J). As Comcare submitted, the Tribunal proceeded on a basis that was neither foreshadowed to Comcare, or could reasonably have been contemplated by it given that the approved Guide required evidence from a suitably qualified physician as to the appropriate comparison and that no such evidence was before the Tribunal. As such, Comcare was denied the opportunity to lead expert evidence on whether Tables 13.2 and 13.3 afforded an appropriate comparison applying the “clinical judgment” assessment methodology in Section 1.5 of the AMA5. It was therefore denied the opportunity to be heard which it ought fairly to have been given in the totality of the circumstances: Minister for Immigration and Border Protection v WZARH [2015] HCA 40; (2015) 256 CLR 326 at [55] (Gageler and Gordon JJ); see also by analogy Seltsam at [79] (Ipp JA (Mason P agreeing)).

105    Finally and in any event, as Comcare submits, it was not open to the Tribunal to undertake a clinical evaluation for itself without medical evidence on the comparison required, given the binding nature of the approved Guide, because the AMA5 (being incorporated into, and therefore part of, the approved Guide) made it clear that that process was to be undertaken by physicians.

4.    CONCLUSION

106    For the reasons given above, I would therefore allow the appeal in part but reserve costs so as to afford the parties the opportunity to make short submissions.

Associate:

Dated:    3 April 2018