FEDERAL COURT OF AUSTRALIA

Ringshaug v Comcare [2017] FCA 48

ORDERS

THE COURT ORDERS THAT:

1.    The application be dismissed.

2.    The parties provide short written submissions on costs in accordance with procedural orders agreed upon or made by the Court in default of agreement.

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

REASONS FOR JUDGMENT

BROMWICH J:

1    On 18 February 2016, the Administrative Appeals Tribunal affirmed three determinations of the respondent, Comcare. Those determinations were made by three different review officers of Comcare, each of whom concluded that the applicant in those proceedings and in this Court, Ms Ringshaug, was not entitled to compensation. Any such right to compensation arises under s 14 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) (Act). This is an appeal by Ms Ringshaug on questions of law under s 44(1) of the Administrative Appeals Tribunal Act 1975 (Cth) (AAT Act), in relation to two of Comcare’s determinations. There is no application made in relation to the third determination.

2    On 1 July 2016, following an application by Comcare and over objection on behalf of Ms Ringshaug, the presiding Deputy President of the Tribunal directed the Registrar of the Tribunal to alter the text of its decision in respect of two paragraphs in which essentially factual errors had been made as to certain aspects of the claims and determinations. Those alterations were made pursuant to s 43AA(1) of the AAT Act. It was common ground that once that direction had been made, the Tribunal’s decision was to be read with those alterations. As a result, several grounds in the supplementary notice of appeal by which the appeal proceeded to hearing were abandoned.

3    For the reasons that follow, the appeal must be dismissed. I will consider separate submissions from the parties as to costs.

The facts as found by the Tribunal

4    The outline of submissions for Ms Ringshaug accepted that the factual background to the appeal was set out at [1]-[9] of the Tribunal’s decision. Comcare did not take issue with that summary. It is therefore convenient to reproduce those paragraphs as they concisely summarise the factual case before the Tribunal and before this Court (the alteration to paragraph 8 made by direction on 1 July 2016 is reflected in mark-up):

1.    The Tribunal has before it three claims brought by Ms Sue Ringshaug under s 14 of the Safety, Rehabilitation and Compensation Act 1988 (the Act). Ms Ringshaug has worked for Disability ACT (under its various names) for almost 20 years. She began her work there as an Administrative Support Officer (ASO) in the Scheduling Office in March 1996, but in recent years has also trained and worked as a Disability Support Officer (DSO) in the group houses run by Disability ACT for people with disabilities.

2.    During that time, Ms Ringshaug has been afflicted by workplace-related illness. In 2001, she suffered an episode of work-related sprain of shoulder & upper arm (bilateral) (though there was some dispute as to whether this could be characterised as occupational overuse syndrome (or repetition strain injury (RSI)); the role of an ASO apparently involves extensive keyboard use). In February 2011, her GP, Dr Low, diagnosed occupational overuse of her right upper limb and in April 2011, Comcare, the respondent in these proceedings, accepted liability for a condition of her neck and right shoulder, arm, wrist and fingers. She undertook a graduated return to work during 2011.

3.    By the time an occupational physician, Dr Le Leu, examined Ms Ringshaug in October 2011 he found that her history was consistent with RSI but, due to previous treatment and the passage of time, there was little to find on examination. Dr Low certified her fit to return to her pre-injury duties from December 2011. During 2012 she worked part-time as a DSO and part-time as an ASO.

4.    On 19 March 2013, Ms Ringshaug attended a meeting with Ms Pieta White, the Scheduling Office Coordinator. At that meeting Ms White told Ms Ringshaug that she would no longer be able to undertake a joint role as a support worker in the group houses and in the Scheduling Office. Ms White told her that, to finalise her workers’ compensation claim of 2011, Ms Ringshaug would need to return to her previous role as a scheduling officer for a short period. She was also informed that undertaking a joint role in the future was not possible due to a conflict of interest. Ms Ringshaug raised concerns about the nature of her work as a scheduling officer and its impact on her RSI condition, as well as concerns about having to be on a roster with some days starting at 7am. The meeting broke up without these issues being resolved.

5.    Over the subsequent two months, there were meetings and emails in which the issues of the meeting of 19 March were discussed, some involving a delegate of the Health Services Union (HSU). These exchanges involved negotiated modifications to Ms Ringshaug’s roster, so that the number of 7am starts could be reduced. On 17 May 2013, Ms Ringshaug read an email from Ms Wilhelmina Blount, her senior manager, dated 15 May, which implied that her bid to work a joint role as both an ASO and a DSO had been rejected. Ms Ringshaug was upset by this email (devastated, felt nauseous and suffered heart palpitations and dizziness). On 20 May she attended Dr Low, who recorded that she was very stressed and anxious due to circumstances at work relating to her work roster and apprehension of re-injury. She began an extensive period of sick leave, during which Dr Low certified elevated blood pressure levels.

6.    On 21 June 2013, Ms Ringshaug lodged a claim for workers’ compensation, based on anxiety and hypertension. She attributed her injury to reading the email from the senior manager on 17 May 2013. In her claim, she stated I feel that I have been bullying and discriminating [sic] with unprofessional accusations from my line manager. More details of the behaviour she alleged had occurred by management at Disability ACT were provided in an employee statement of 21 August 2013. In the statement, Ms Ringshaug said that at the meeting on 19 March 2013 Ms White had thrown the roster at her and that the roster had been designed to prevent her from picking up creamy shifts. Ms Ringshaug said she felt humiliated and insulted by what had been said. Ms Ringshaug said that she wanted to speak to her line manager and Ms White responded by saying you just want to pick a fight and walked out. She said that her managers were trying to bully me into working a roster that would affect my well-being and exacerbate my pre-injury.

7.    In a determination dated 25 September 2013, Comcare denied liability for Ms Ringshaug’s condition of anxiety and hypertension under s 14. It affirmed the determination on 18 February 2014 and Ms Ringshaug lodged an application to review this decision on 25 March 2014 (2014/1559 – the first action).

8.    In a medical certificate dated 17 March 2014, Dr Low certified that Ms Ringshaug was unfit for work due to an aggravation of sprain to R elbow, R wrist and R fingers caused by Excessive use of computer. On the same day, Dr Low recorded in his clinical notes Roster issues, not able to adjust work times. Recurrence of pain R wrist/R elbow, gripping poorly. On 13 May 2014, Ms Ringshaug’s solicitors lodged a workers’ compensation claim for permanent impairment and non-economic loss in relation to her accepted Aggravation of right upper limb overuse injury, noting the impairment as right hand, R wrist, R upper limb and Neck. Comcare denied liability under this claim on 29 January 2015, and affirmed that decision on 24 February 2015. On 14 November 2014 Comcare advised Ms Ringshaug that it intended to determine that she had no present entitlement to medical treatment or incapacity for the accepted condition referred to in paragraph 2. Comcare made a determination to that effect on 29 January 2015, and affirmed it on reconsideration on 24 February 2015. Ms Ringshaug sought a review of that decision by this Tribunal on 19 March 2015 (2015/1278 – the second action).

9.    On 12 November 2014, Ms Ringshaug lodged a claim for workers’ compensation for a secondary condition of Secondary Major Depressive Disorder and Adjustment Disorder with Anxiety. In it she claimed that the condition developed as result of her previous physical injuries, saying she first noticed her condition on 17 May 2013 and first sought treatment for it on 21 May 2013. Comcare denied liability for this condition on 28 January 2015 and affirmed that decision on 16 March 2015. On 7 April 2015, Ms Ringshaug filed an application in the Tribunal for review of that decision (2015/1602 – the third action).

5    As noted above, this appeal is brought in respect of the Tribunal’s decision in relation to the first and second actions only.

The relevant statutory provisions

6    The relevant key provisions of the Act are as follows:

(1)    s 14(1) relevantly provides that, subject to the balance of Part II, Comcare is liable to pay compensation in accordance with the Act in respect of an “injury” suffered by an employee if the injury results in death, incapacity for work, or impairment (with certain immaterial exclusions contained in ss 14(2) and (3));

(2)    ailment is exhaustively defined in s 4(1) to mean “any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development)”;

(3)    s 4(1) provides that injury and disease have the meanings given by ss 5A and 5B respectively as follows:

5A    Definition of injury

(1)    In this Act:

injury means:

(a)    a disease suffered by an employee; or

(b)    an injury (other than a disease) suffered by an employee, that is a physical or mental injury arising out of, or in the course of, the employee’s employment; or

(c)    an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee’s employment), that is an aggravation that arose out of, or in the course of, that employment;

but does not include a disease, injury or aggravation suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment.

(2)    For the purposes of subsection (1) and without limiting that subsection, reasonable administrative action is taken to include the following:

(a)    a reasonable appraisal of the employee’s performance;

(b)    a reasonable counselling action (whether formal or informal) taken in respect of the employee’s employment;

(c)    a reasonable suspension action in respect of the employee’s employment;

(d)    a reasonable disciplinary action (whether formal or informal) taken in respect of the employee’s employment;

(e)    anything reasonable done in connection with an action mentioned in paragraph (a), (b), (c) or (d);

(f)    anything reasonable done in connection with the employee’s failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment.

5B    Definition of disease

(1)    In this Act:

disease means:

(a)    an ailment suffered by an employee; or

(b)    an aggravation of such an ailment;

that was contributed to, to a significant degree, by the employee’s employment by the Commonwealth or a licensee.

(2)    In determining whether an ailment or aggravation was contributed to, to a significant degree, by an employee’s employment by the Commonwealth or a licensee, the following matters may be taken into account:

(a)    the duration of the employment;

(b)    the nature of, and particular tasks involved in, the employment;

(c)    any predisposition of the employee to the ailment or aggravation;

(d)    any activities of the employee not related to the employment;

(e)    any other matters affecting the employee’s health.

This subsection does not limit the matters that may be taken into account.

(3)    In this Act:

significant degree means a degree that is substantially more than material.

Martin v Comcare argument before the Tribunal and impact of Comcare v Martin [2016] HCA 43; (2016) 339 ALR 1

7    A critical issue for the main part of Ms Ringshaug’s case in this appeal turned on the scope of the exclusion, from the s 5A(1) definition of “injury” in the sense of the specified “disease, injury or aggravation”, of any such affliction suffered “as a result of reasonable administrative action taken in a reasonable manner in respect of the employee’s employment”. That is, whether there was a relevant causal relationship between the administrative requirement imposed on Ms Ringshaug to work full-time in only the scheduling role, and if so, whether that action was reasonable and taken a reasonable manner.

8    The Tribunal hearing took place between 7 and 9 December 2015. As explained in the course of submissions before the Tribunal by counsel then appearing for her, Ms Ringshaug’s case was that she entertained a fear induced by her doctors that if she did not have a mix of duties she was likely to suffer a recurrence of her prior injuries (referred to as repetitive strain injury or “RSI” by the Tribunal, although the prior injuries were not accepted by that description by Comcare) and that this was the driver for seeking that mixed work as opposed simply to wanting that mix of duties because that was what she preferred to do. In that sense, it was argued that her injury was not caused by the administrative action in deciding what work she should perform, but rather her psychological reaction to the possible practical consequences of having to do that work. That particular argument relied upon a then binding Full Court decision (by majority) decided a week before the Tribunal hearing on 30 November 2015, Martin v Comcare [2015] FCAFC 169; (2015) 238 FCR 373, considered in more detail below.

9    The Full Court decision (by majority) was to the effect that the phrase “as a result of” in s 5A(1) of the Act required a “common sense” approach to causation because the Tribunal had confused consequence with causation and thereby erred in treating as causative an event which was no more than “chronologically precedent”. Arguably, the practical effect of the Full Court decision was that unless the last step in a chain of causation was reasonable administrative action, the exclusion would not apply. In this case, the last step was said to be Ms Ringshaug’s reactive fear of the associated consequences of the administrative decision, rather than the direct consequence of the administrative decision itself. That interpretation significantly reduced the ambit of the reasonable administrative action exclusion by denying “but for” causation reasoning of the kind that might otherwise be considered to arise from the phrase “as a result of” in the sense of being a direct and foreseeable consequence as part of a chain of causation.

10    Comcare’s position at all times was that, even applying the favourable Full Court decision in Martin v Comcare, it having been raised before the Tribunal and distinguished on the facts in this case, this appeal should be dismissed.

11    On 16 May 2016, the High Court granted Comcare special leave to appeal from the Full Court decision in Martin v Comcare. There can be no doubt that the Tribunal’s decision in this case was in contemplation as part of the appeal process in what became Comcare v Martin in the High Court. That is because, in the course of argument in reply on behalf of Comcare at the special leave to appeal hearing, specific reference was made to the Tribunal’s decision in this case and in particular to the Tribunal’s finding at [46] of its reasons that the argument made on behalf of Ms Ringshaug to the effect that the Full Court decision meant that only the last link in the chain of causation should be assessed under s 5A of the Act for reasonable administrative action was a “supportable interpretation” arising from the Full Court’s decision in Martin v Comcare, albeit distinguishable. This was the last argument advanced for the grant of special leave to appeal and was clearly advanced as a possible consequence that would flow from not granting special leave to appeal. Special leave to appeal was granted immediately after that was said: Comcare v Martin [2016] HCATrans 116 at lines 605-30.

12    The appeal by special leave in Comcare v Martin was heard by the High Court on 26 August 2016 and the decision reserved. That remained the position at the time of the hearing of this appeal on 21 September 2016. On 9 November 2016, the High Court overturned the Full Court’s decision: Comcare v Martin [2016] HCA 43; (2016) 339 ALR 1. As relevant to this appeal, the High Court:

(1)    at 9 [46] explicitly confirmed that the text of the Act achieved the purpose described in the explanatory memorandum to the Bill for the amending Act by which the reasonable administrative action exclusion was introduced, being to “ensure that the wide range of legitimate human resource management actions, when undertaken in a reasonable manner, do not give rise to eligibility for workers' compensation”, including preventing claims “being used to obstruct legitimate management action by excluding claims where an injury (usually a psychological injury) has arisen as a result of” such administrative action;

(2)    held at 9-10 [47]-[48] (with parallel references to “injury” or “aggravation” added in square brackets as the same reasoning applies):

47.    Having regard to the text and structure of ss 5A and 5B, and consistently with the statutory purpose of the exclusion in s 5A(1), what is required to meet the causal connection connoted by the exclusionary phrase in s 5A(1) in its application to a disease within s 5A(1)(a) [or to an injury other than a disease within s 5A(1)(b) or an aggravation of an injury other than a disease within s 5A(1)(c)] is therefore that the employee would not have suffered that disease [or injury or aggravation], as defined by s 5B(1), if the administrative action had not been taken. That is to say, the causal connection is met if, without the taking of the administrative action, the employee would not have suffered the ailment or aggravation that was contributed to, to a significant degree, by the employee's employment.

48.    The causal connection giving rise to the exclusion from the definition of injury is met where the disease [or injury or aggravation] suffered by the employee is a mental condition or an aggravation of a mental condition suffered by the employee in reaction to a failure to obtain promotion, including in reaction to a perceived consequence of that failure to obtain promotion. The nature of the perceived consequence – whether personal or professional, direct or indirect, real or imagined – is beside the point.

13    Upon the handing down of the High Court’s decision in Comcare v Martin on 9 November 2016, the parties were given an opportunity to provide supplementary submissions addressing that decision. The supplementary submissions on behalf of Ms Ringshaug conceded that the effect of that decision was that her core argument which relied upon the Full Court decision in Martin v Comcare must fail. That is, she must fail on the exclusion issue in relation to the first action because it is clear that without the taking of the administrative action in relation to the work she was required to do, she would not have the condition upon which that action was based. However it was submitted on her behalf that it remained for this Court to determine whether her appeal should succeed on the remaining grounds, without articulating what those grounds were, or how they could deliver her success on her appeal.

14    Supplementary submissions on behalf of Comcare asserted that the concession as to the effect of the High Court decision in Comcare v Martin meant that the appeal on the first action had to fail; and that there was no separate basis upon which the appeal on the second action could succeed. For the reasons detailed below at [17], I accept Comcare’s supplementary submission that there was no basis for the second action and related appeal ground in this Court to succeed in the absence of success on the first action and related appeal ground. This should mean that the concession made on behalf of Ms Ringshaug following Comcare v Martin means that her appeal must fail. However the contrary position has been advanced and the appeal must therefore be determined in full.

The case before the Tribunal

15    The first action, by which a claim was made for anxiety and hypertension arising from reading an email which implied that Ms Ringshaug would not be able to resume mixed work, was considered by the Tribunal to give rise to two issues:

(1)    whether she had suffered an ailment, being a mental condition outside the boundaries of normal mental functioning and behaviour; and

(2)    if so, whether it occurred as a result of reasonable administrative action taken in a reasonable manner in respect of her employment.

16    Comcare accepted that if Ms Ringshaug’s psychological condition was an ailment for the purposes of the Act, it was contributed to, to a significant degree, by her employment. However, Comcare did not concede that it was such an ailment.

17    The Tribunal regarded the joint position of the parties before it as being that the failure of Ms Ringshaug’s first action would lead inevitably to failure of the second action. At the hearing of this appeal, counsel for Ms Ringshaug took issue with the nature and extent of the concession made before the Tribunal. This issue is addressed more fully below at [26]. It should be noted in that regard that the evidence that was accepted by the Tribunal was to the effect that there was no physical cause of the injuries claimed in the second action, but rather that they were all psychological in nature, derived wholly or substantially from the asserted fears of re-injury arising from being required to do full-time scheduling work. In other words, the second action was based on an asserted injury that was essentially or substantially psychosomatic in nature, largely or entirely derived from fears arising from the circumstances giving rise to the first action.

18    The Tribunal carefully considered the medical evidence before it, describing the psychiatric evidence on Ms Ringshaug’s mental state in May 2013 as conflicting and inconclusive. On balance, the Tribunal did not find that her condition, then or later, was of such clinical significance as to place it within the ambit of an injury or disease under the Act. Although her condition was clearly contributed to, to a significant degree, by her employment, it was not a condition that was compensable.

19    The Tribunal applied what it regarded as the concession that failure on the first action would lead to failure on the second action.

20    The Tribunal only turned to the question of reasonable administrative action in the alternative, in case it was wrong in finding that Ms Ringshaug did not suffer an injury or disease within the ambit of the Act. That is, if Ms Ringshaug did suffer an ailment, the question was whether it was nonetheless excluded as being the product of reasonable administrative action taken in a reasonable manner in relation to her employment. In considering that question, the Tribunal considered that any such ailment was attributable to more than simply reading the email which informed her that a return to mixed work would not take place and that the physical reaction to the email is best viewed as a combination of a series of workplace actions that impacted upon Ms Ringshaug. The Tribunal noted that those asserted workplaces actions likely included:

(1)    prior to the email, being informed that she could not work in both roles due to a conflict of interest;

(2)    a meeting in which Ms White was said to have thrown a roster at her;

(3)    communications regarding various iterations of the roster in which her preferences were not fully upheld;

(4)    a meeting in relation to her future role in roster issues; and

(5)    the email in question.

21    It was considered by the Tribunal evident that, individually or collectively, those actions constituted administrative action taken in respect of Ms Ringshaug’s employment, being a characterisation that was conceded by her counsel. Those actions then had to be considered as to whether or not one or more of them was reasonable, and undertaken in a reasonable manner. As the Tribunal put it at [33] (emphasis added):

For present purposes it is sufficient to consider whether the succession of actions which impacted on Ms Ringshaug in the early months of 2013, taken as a whole and being administrative action taken in respect of her employment, amounted to reasonable action taken in a reasonable manner.

22    The Tribunal found that most of Ms Ringshaug’s assertions of unreasonable behaviour were not the subject of evidence as opposed to mere assertion. The one allegation which was the subject of evidence concerned what was described as conflict of interest issues in having an employee who was responsible for scheduling disability support rosters also being one of the persons performing that work and therefore getting the benefit of favourable scheduling decisions. That gave rise to a related issue of workplace harmony arising out of discontent on the part of other employees, apparently because of the existence of such an arrangement.

23    It was submitted on behalf of Ms Ringshaug that the conflict of interest consideration (incorporating the aspect of the adverse reaction of other employees) should have been put to one side and a return to mixed duties permitted if only in her case because of her unique medical considerations. The Tribunal accepted that this would have been a reasonable response by management, but did not accept the converse, namely that failure to do so was unreasonable. The Tribunal characterised the responses of management to Ms Ringshaug’s employment issues as “meticulous and diligent”.

24    The Tribunal considered an argument that the Full Court decision in Martin v Comcare meant that the reasonable administrative action exclusion could not apply, but rejected that argument upon the ground that, accepting the Full Court test, the exclusion nonetheless applied because it found that Ms Ringshaug’s condition was a direct consequence of management’s actions in a straightforward cause-and-effect sense. That is, even reading down the exclusion to the extent required by the Full Court decision so that the exclusion only applied if the last step in a chain of causative events was itself reasonable administrative action, the exclusion still applied because of the direct relationship between the decision and her reaction. This was a relevant difference to the situation in Martin v Comcare in which the reaction was indirect because it arose from the flow-on effect of a failed promotion application and Ms Martin realising that it meant a return to a prior position under a supervisor whom she considered had bullied her. The Tribunal characterised the argument advanced on Ms Ringshaug’s behalf that she was injured by her reaction to management’s actions, and not by the actions themselves, was based on a logical fallacy. The Tribunal said this was the equivalent of a child arguing that what broke his mother’s window was a cricket ball interacting with it, not his cricket bat propelling the ball in its direction.

25    Whatever the merits of the cricket ball analogy, it is clear that Ms Ringshaug’s exclusion argument depended upon the Full Court’s reasoning process applying, an argument that is no longer available given the decision of the High Court. Although it is now academic except perhaps on the question of costs, I consider that the Tribunal was correct in concluding that even on the narrower Full Court test in Martin v Comcare, the reasonable administrative action exclusion would have applied because of the direct nexus Ms Ringshaug asserted between the condition she relied upon and the actions of her employer.

26    Reference was made at [17] above to the argument that the Tribunal had misunderstood the nature and extent of the concession made on behalf of Ms Ringshaug in relation to the impact of failure on the first action on success on the second action. At the hearing of the appeal, it was argued on her behalf that the concession as to the second action failing if the first action failed was confined in nature. It was asserted to have been limited to failure on the first action upon the basis of reasonable administrative action only and not to have extended to failure only upon the basis of a finding of an insufficient ailment. The reasoning was that failure on the first action on the basis of insufficient ailment only did not preclude success on the second action because the psychosomatic illness might be severe enough even though its source was not. It is not necessary to consider whether the doubtful proposition standing behind the asserted more limited concession is correct or not. That is for two reasons. First and most fundamental, I have carefully considered the portions of transcript to which I was taken by the parties and consider that the Tribunal was correct to regard the wider concession as having been made on Ms Ringshaug’s behalf. If a more limited concession was intended, that was not what was conveyed. The Tribunal was entitled to proceed upon the basis that the wider concession had been made. Secondly, even on the narrower concession, failure on the reasonable administrative action ground for the first action necessarily meant failure on the second action. As the High Court decision dictates failure of the first action on the reasonable administrative action ground, the second action must also fail.

Conclusion

27    By reason of the above, this application must be dismissed.

Costs

28    As to costs, it was submitted on behalf of Ms Ringshaug that in the event that the application was dismissed, she should not be ordered to pay Comcare’s costs because she was entitled to and did rely on the state of the law as it stood at the time of the Tribunal hearing and at the time of lodging and arguing her appeal in this Court. It was submitted that in those circumstances it would be unfair and impose a great financial hardship on Ms Ringshaug if she were ordered to pay the Commonwealth’s costs. Comcare sought to be heard on the question of costs after judgment, which is the course I propose to adopt by way of a timetable for short written submissions and a determination in Chambers.

Associate:

Dated:    3 February 2017