Workers Compensation Insurance – Case Commentary Update

When success doesn’t mean success

Section 81A Supreme Court Appeal – Medwin v Toll Transport Pty Ltd 2018/15

(Click here to view case)

Many of you will recall that last year the Chief Commissioner had found that there was not a reasonably arguable case in relation to Mr Medwin’s claim for workers compensation.

What was extraordinary about that matter was that the Chief Commissioner said the following:

“That while the employer was successful with respect to grounds 2 and 3 (the defences of administrative action), ground 1 of the reference (relating to the cause of the injury) fails, as the employer has not discharged the onus of proof.”

Instead of finding there was a dispute he said the employer failed.  No dispute order was made.

It would be fair to say that this decision caused some disquiet within the insurance industry.  Most of us had thought an employer only needs to succeed on one ground.

As a result, this firm appealed this decision.

This commentary relates to Justice Wood’s Reasons for Judgment which were handed down on 10 April 2018.

The first point that must be emphasised is that although our appeal was unsuccessful, it does not mean that if, for example, an employer challenges a claim pursuant to S81A on two grounds, it loses if it only establishes one of those grounds.  Putting it another way, if it challenges on two grounds.  One is enough.

Why then was the appeal unsuccessful?

The appeal was unsuccessful because the Judge said that although the Chief Commissioner had made these comments about the employer being “successful”, it was wrong for that passage to be read in a “piece meal fashion”.  In fact, the Chief Commissioner did not find that the employer had succeeded with respect to the administrative action grounds at all.

Her Honour’s thought process:

  • There was no dispute that on 7 October 2016 a supervisor had spoken inappropriately to the worker.  Dr Chow, an independent medical psychiatrist accepted that it was that incident which occurred on 7 October 2016 which was the causative factor, the most significant factor in the development of his condition, this of course being an injury which was a disease.
  • This was also a case where there seemed to be some other non-work related factors but Dr Chow said that he could not say that those other non-work related factors had contributed to his condition.
  • The “administrative action” related to some safety issues which occurred prior to 7 October 2016.  These incidents were referred to as “sock tucking” which apparently involved a significant risk of injury to the worker.
  • The Chief Commissioner said that if those sock tucking incidents were causative of the worker’s condition, then it was reasonably arguable the statutory defences are available.
  • The Judge said that that view was expressed conditionally.  That depended on the sock tucking incidents being causative of the Respondent’s condition.
  • Her Honour then went on to say that although the Chief Commissioner had spoken about “success”, the Chief Commissioner had not made any finding that the sock tucking was causative of the injury.  Because the Chief Commissioner had not made any findings that they were causative, then even though he said that the employer was “successful”, he only meant the employer would have been “successful” if those findings had been made.

Practical effect of the decision

As will be readily appreciated, despite what, on the face of it, were fairly clear words by the Chief Commissioner, Her Honour was entitled to consider the totality of the evidence that was presented and the context in which the Chief Commissioner made that statement.

Accordingly, you will appreciate this was not a case where the employer had succeeded on grounds 2 and 3 but failed on ground 1.  Essentially what the Judge is saying is that the employer failed on grounds 1, 2 and 3.

I commenced this commentary by saying that this case does not establish that if an employer for example, takes out a S81A Referral on 2 grounds, they must succeed on both grounds.

There is nothing in the decision to indicate that Her Honour was of the view that an employer must be successful on every ground that is raised in a Section 81A Referral.

Please do not hesitate to contact me, or one of your Page Seager Insurance contacts if you have any questions.

Nick Sweeney
T: (03) 6235 5133

Published: 23 April 2018

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