MOIR v IHC NEW ZEALAND INCORPORATED [2019] NZCA 92

MOIR v IHC NEW ZEALAND INCORPORATED [2019] NZCA 92 [5 April 2019]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA377/2018[2019] NZCA 92BETWEEN JULIE MOIRAppellantAND IHC NEW ZEALAND INCORPORATEDFirst RespondentAND PAUL WILSONSecond RespondentHearing: 26 February 2019Court: French, Dobson and Brewer JJCounsel: A C Beck for AppellantP A McBride and F M Lear for First RespondentB A Davies and N J G Smith for Second RespondentJudgment: 5 April 2019 at 9 amJUDGMENT OF THE COURTA The appeal is dismissed.B We make an order under s 45(5) of the Legal Services Act 2011 that had s 45not affected the appellant's liability to pay costs, the appellant would havebeen ordered to pay costs to the first respondent for a standard appeal on aband A basis with usual disbursements. We would not have certified forsecond counsel.____________________________________________________________________REASONS OF THE COURT(Given by French J)Introduction[1] Ms Moir invoked the review procedures under the Accident CompensationAct 2001 (the Act). The reviewer assigned to her case was the second respondent,Mr Wilson. He directed that certain medical evidence which Ms Moir wanted toadduce was to be filed by a specified date otherwise, in the absence of exceptionalcircumstances, it would not be admitted in evidence. Ms Moir failed to comply withthat timetabling direction. Mr Wilson declined to admit the evidence and proposedinstead to proceed to determine the review without it.[2] Ms Moir then sought judicial review of Mr Wilson's decision to decline toadmit the evidence.[3] The case was heard by Ellis J. The Judge found Mr Wilson's decision was fairand dismissed the application for judicial review.1[4] Dissatisfied with that outcome, Ms Moir brought this appeal.BackgroundEvents leading up to the Reviewer's direction[5] Ms Moir was employed by the first respondent, IHC New Zealand Inc.In March 2013 she suffered a workplace accident. She injured her back and made aclaim for accident compensation. IHC is an accredited employer under the Act.2 AsEllis J noted, that means that for all relevant intents and purposes IHC stands inthe shoes of the Accident Compensation Corporation (ACC).3[6] The claim was managed on behalf of IHC by an organisation called WorkAon.On 25 August 2015, WorkAon determined that as at 27 March 2014 Ms Moir was nolonger incapacitated for employment as a result of the accident. That determination1 Moir v IHC New Zealand Inc [2018] NZHC 1360.2 See Accident Compensation Act 2001, s181. This provides that an accredited employer "means anemployer who has entered into an accreditation agreement [with the Accident CompensationCorporation] and includes the Corporation while it is accredited under s 186".3 Moir v IHC New Zealand Inc, above n 1, at [2].ended her entitlement to weekly earnings compensation with effect from27 March 2014.[7] Ms Moir consulted a lawyer, Mr Sara, and on 25 November 2015 he filedan application for review of the determination under s 134 of the Act.[8] ACC has contracted its review function to FairWay Resolution Ltd.FairWay employs individual reviewers who are appointed under s 137 of the Act toconduct the reviews. Mr Wilson is one of those reviewers.[9] On 29 January 2016, FairWay asked Mr Sara whether he intended to call anyexpert evidence, what steps were being taken to obtain that evidence, and when wouldit be available. This and two further communications from FairWay to Mr Sara abouta hearing date did not elicit any response.[10] On 16 February 2016, FairWay issued a notice advising the review hearingwould be held on 10 May 2016. On 6 May 2016, Mr Sara sought an adjournment onthe grounds he wanted to seek an opinion from an orthopaedic surgeon aboutMs Moir's case. The adjournment was initially declined but when it transpired atthe commencement of the hearing that Mr Sara did not have a copy of WorkAon's fileregarding the claim, Mr Wilson considered he had no choice but to adjourn. The filecontained the complete record of Ms Moir's medical history and correspondence.[11] At the appeal hearing before us, each party sought to put the blame on the otherfor the fact Mr Sara did not have the file. Ms Moir's counsel, Mr Beck, submittedWorkAon should have disclosed it, while Mr McBride for IHC said that normal civilrules about discovery applied and it was incumbent on Mr Sara to have asked for it.[12] Returning to the narrative, very shortly after the adjournment, Mr Wilsonemailed the parties on 12 May 2016 recording his concern about the delay and advisingthat he now intended to actively case manage the progression of the review.[13] On 8 June 2016, in response to an inquiry from FairWay about progress,Mr Sara advised that he had received a recommendation Ms Moir see Mr Bartle, anorthopaedic specialist. He would be writing to Dr Bartle shortly. Mr Sara did notrespond to a further inquiry from FairWay as to when instructions had been sent.The evidence before Ellis J showed that instructions were sent to Mr Bartle on16 June 2016 and that an appointment had been made for Ms Moir to see Mr Bartleon 8 August 2016.[14] Ms Moir failed to keep that appointment, and Mr Sara failed to respond toanother request from FairWay on 25 August 2016 for an update on progress.[15] WorkAon made a further request for an update on 5 September 2016 and it andFairWay were then informed of the missed appointment and difficulties Mr Sara'soffice had experienced in trying to contact Ms Moir.[16] On 9 September 2016 FairWay asked the parties how the review should beprogressed in light of Ms Moir's failure to attend the appointment. Mr Sara did notrespond. He did reply to a further inquiry along similar lines, and advised that he hadasked Mr Bartle to re-schedule the appointment. Mr Wilson sought further detail aboutthe date and indicated he would allow one month after the appointment for the reportto be produced.[17] On 22 September 2016, Mr Sara advised FairWay that Ms Moir hadan appointment with Mr Bartle on 7 November 2016. Mr Sara made no commentabout the feasibility of having the report available in December.[18] On 5 October 2016, Mr Wilson issued the following direction:1. Any evidence from Dr Bartle is to be filed with Fairway and Aon no laterthan 5.00 pm on 19 December 2016.2. Any response from Aon's appointed expert to be filed with Fairway andMr Sara no later than 5.00 pm on 30 January 2017.3. Any final comment from Dr Bartle is to filed with Fairway and Aon nolater than 5.00 pm on 14 February 2017.4. The review is to be re-set for hearing on the first available date on or after21 February 2017.I note this review decision dates back to 25 August 2015. By the reviewhearing it will be around some 18 months old.It does not, on the evidence before me at this time, involve an unusual orespecially complex issue.Evidence being provided significantly after the decision date will, as a generalrule, (all other factors being equal) carry less weight than evidencecontemporaneous to the decision date.Having regard to that observation, the timely delay endorsed by thelegislation, and the history of this review generally, I therefore put the partieson notice any evidence filed outside of the time limits set out above will not,save in the most exceptional circumstances, be admitted in evidence by me.It would in my view be prudent for the advocates to ensure their respectiveexperts are aware of that fact, however, this ultimately a matter for eachadvocate's professional discretion.Paul WilsonThe parties are to comply with the above instructions and deadlines.The Reviewer will only alter these instructions and deadlines for compellingreasons. The Reviewer's instructions and deadlines will stay as they are unlessyou hear differently from us.FairWay Resolution Limited will contact the parties to arrange a date for thereconvened hearing.Rachel Atori, Fairway[19] For reasons that have never been properly explained, Ms Moir cancelled her7 November 2016 appointment and a third appointment was re-scheduled for19 December 2018. Mr Bartle's rooms sent an email to Mr Sara advising of thisdevelopment on 4 November 2016.[20] Mr Sara did not seek an extension of time for filing the report and was to latertell the reviewer that he was unaware at the time that the appointment had beencancelled.[21] The deadline of 19 December for filing the evidence having passed withoutcompliance, Mr Wilson advised the parties on 12 January 2017 that although he wasagreeable to hearing evidence from Ms Moir, he was not prepared to admit any newexpert evidence.[22] Mr Sara replied by email on 16 January 2017 asking Mr Wilson to reconsider.Mr Sara advised that this was his first day back at work and that Mr Bartle's reporthad been received in his office on 23 December 2016 but there had been no time todeal with it that day. Mr Sara forwarded a copy of the Bartle report.[23] Mr Wilson declined to re-consider his decision. This prompted Mr Sara to senda further email on 16 January informing him of the cancellation and rescheduling ofthe second appointment. The email also stated that neither Ms Moir nor Mr Bartlewas aware of the deadlines (although Mr Wilson had earlier recommended Mr Bartlebe advised) and ended by stating that, unless the report from Mr Bartle was admitted,the matter would be taken further, including possible judicial review proceedings.[24] On 17 January 2017, WorkAon notified its opposition to the evidence beingadmitted and on 20 January 2017, Mr Wilson confirmed his earlier decision inthe following terms:I have considered at length the whole history of this review including myprevious direction as to filing of expert evidence.I note that direction has not been complied with although it appears theapplicant was in fact in receipt of the evidence now sought to be relied uponwithin the time scale set.The admission of that evidence is now opposed by the Respondent.In the circumstances given that history, the very clear direction, the fact thatthe evidence was available, no extension of time was sought and the objectionto admission, I decline to allow its filing.I would now appreciate comment from the parties as to whether they wish toreconvene an oral hearing or to conclude this review on the papers, allowingprior opportunity for any written submission either may wish to lodge.[25] This prompted a further email from Mr Sara pointing out that Mr Wilson wasmistaken in saying Mr Sara had received the report prior to the deadline of19 December. In fact, he had only received the report on 23 December 2016. Mr Saraalso explained that 23 December was his last day of work for the year and in the usuallast minute rush, he had overlooked seeking an extension of time. He again requestedMr Wilson reconsider the matter with the benefit of this new information andcorrection. In a later email, Mr Sara claimed he was not aware of the cancellation butaccepted responsibility for the failure to apply for an extension of time which hedescribed as an oversight.[26] On 1 February 2017, Mr Wilson issued a final direction on the issue.I note Mr Sara's comment. I have revisited my directions notice of5 October 2016.I am satisfied that the directions provided were entirely unequivocal and thatthe requested evidence was to be filed no later than 5pm on19 December 2016.That report was not filed until 16 January 2017 although it appears to be dated19 December 2016.No extension of time for filing was sought.Aon has objected to the evidence being admitted in breach of directions.Should that evidence be admitted and in accordance with the earlier directionsI will then have to allow Aon a response with a final response to the applicant.Realistically this means the review will not be ready to proceed for somewherein the region of a further 3-4 months.By that point in time the original substantive decision will be approaching twoyears of age.Taking all these factors together, I decline to admit the evidence of Dr Bartle.I would appreciate clarification from the advocates accordingly as to whetherthey wish to reconvene a hearing in person, by telephone or on the papers.[27] Ms Moir was not prepared to participate in a review without the evidence ofMr Bartle. Instead, she filed the current proceedings in the High Court on31 May 2017. Due to what Ellis J described as "further noise occasioned by a wrangleover a fee waiver application",4 the hearing in the High Court did not take place until1 March 2018.4 At [50]. Ms Moir sought a review of the decision of the High Court registrar who had requiredher to provide a copy of the Legal Services Agency letter granting her legal aid before the registrarwould waive filing fees. Mallon J declined the application for a review. Ms Moir applied forMallon J to rescind her decision. This too was declined as was another application by Ms Moirseeking leave to appeal Mallon J's decision to this Court. This Court declined an application forspecial leave to appeal as well as an application to review a registry decision regarding refund offiling fees.High Court decision[28] In her decision, Ellis J said she was prepared to proceed on the assumption thatMr Bartle's report may be helpful to Ms Moir's case although the Judge also observedthat:5a medical opinion of that kind is likely to be less valuable when some time haspassed not only since the relevant accident (nearly four years) but the decisionunder review (one and a half years).[29] The Judge noted that under the Act there is no absolute obligation on a reviewerto permit a party to call evidence, which in turn meant that a party did not have"a right" to call evidence. However, it was also clear, the Judge said, that the reviewerwas bound by the rules of natural justice,6 and natural justice might depending onthe circumstances require a reviewer to afford a party the reasonable opportunity tocall evidence.7[30] Justice Ellis characterised Ms Moir's complaint against Mr Wilson as beingessentially one of breach of natural justice.8 Having reviewed the sequence of eventsleading up to Mr Wilson's decision, the Judge said she was satisfied that Ms Moir hadbeen given a reasonable opportunity to present her case on review including medicalevidence "but failed to exercise it in a timely way".9 In the Judge's view, there hadbeen no vitiating breach of natural justice and the decision made by Mr Wilson wasfair.[31] The Judge further noted that if the review were to proceed without Mr Bartle'sreport, Ms Moir still had a remedy in the form of appeal rights to the District Court.10Mr Bartle's report could be put in evidence on appeal and accordingly any prejudiceoccasioned by its absence at the review stage would be remedied.5 Moir v IHC New Zealand Inc, above n 1, at [65].6 At [62] citing the Accident Compensation Act, s 140.7 Moir v IHC New Zealand Inc, above n 1, at [63].8 At [55].9 At [74].10 At [73]; Accident Compensation Act, s 149(1)(a).Two further matters[32] Finally, for completeness in this summary of the background, we recordtwo further matters. The first is that neither Mr Sara nor Ms Moir provided an affidavitfor the purposes of the judicial review.11 It may be that the absence of any affidavitfrom Mr Sara is explained by the fact he was the solicitor on the record for the judicialreview proceedings. However, we would suggest the more appropriate course wouldhave been for another independent solicitor to have issued the proceedings especiallyin circumstances where Mr Sara's own role in events at issue was inevitably going tobe under the spotlight.[33] The second matter is that Mr Wilson was represented at the High Court hearingand through counsel appears to have taken an active part in the hearing. The usualpractice is for the decision maker to abide the decision of the Court and not to advocatetheir position.12 No objection was however taken in the High Court. At the beginningof the appeal, we raised concerns that the submissions filed on behalf of Mr Wilsonseemed to go further than simply providing information to assist the Court. In light ofthis indication from the panel, Ms Davies responsibly elected not to make any oralsubmissions.The appeal[34] Mr Beck emphasised that Mr Bartle's report was relevant evidence and shouldhave been admitted. He argued that Ellis J had erred in analysing the case solely interms of the rules of natural justice and as a result had failed to fully appreciate andaddress the arguments raised on Ms Moir's behalf.[35] When pressed by us to view the case through a judicial review lens and listthe grounds of review other than breach of natural justice, Mr Beck however had somedifficulty which may explain why the Judge took the approach she did.11 There was an affidavit from Mr Sara's secretary.12 Secretary for Internal Affairs v Pub Charity [2013] NZCA 627, [2014] NZAR 177; andAttorney-General v Maori Land Court [1999] 1 NZLR 689 (CA).[36] The statement of claim pleaded three main grounds of review, namely thatMr Wilson's decision:(a) was not in accord with the statutory scheme;(b) failed to take relevant matters into account; and(c) was a disproportionate response to the situation.[37] In oral submissions, Mr Beck conceded — albeit reluctantly — that there ispower under the Act for a reviewer to exclude relevant evidence. He also concededthere is power to make the type of "unless order" that was made by Mr Wilson in thiscase.[38] Mr Beck's concession was an appropriate one. The Act confers a widediscretion on reviewers regarding the conduct and control of the review process,including what evidence (if any) is to be admitted. Timeliness and the expeditiousdisposal of issues are also strong imperatives under the Act. There are for examplestatutory time limits on the lodging of claims and reviews as well as time limits onthe issuing of decisions.13 Significantly for present purposes as regards reviews, s 140specifically states that although a reviewer may conduct the review in any manner heor she thinks fit, they must (among other things) "adopt an investigative approach witha view to conducting the review in an informal, timely, and practical manner."14Section 144 requires the reviewer to make a review decision within 28 days afterthe hearing of the review finishes,15 while s 146 provides that a reviewer is deemed tohave made a decision on the review in favour of the applicant if the date for the reviewhearing has not been set within three months following receipt of the reviewapplication.13 Accident Compensation Act, ss 53, 56–58.14 Section 140(e). Section 140 also requires the reviewer to comply with s 138; comply with anyother relevant provision of the Act and any regulations made under the Act; comply with theprinciples of natural justice; and exercise due diligence in decision-making.15 Section 144(1)(a). Section 144(1)(b) provides that if there is no hearing, the reviewer must makea review decision within 28 days after the day that the applicant, the Corporation, and all personswho would be entitled to be present and heard at the hearing specify for the purposes of this sectionin their agreement not to have a hearing; or if those persons do not specify a day, the day on whichthose persons agree not to have a hearing.[39] Contrary to a submission made at one point by Mr Beck, we do not accept thatthe time limits are only there for the benefit of a claimant. In our view, apart fromanything else, the integrity of the process is also important.[40] The existence of the power which Mr Wilson purported to exercise not beingdisputed, we turn to the specific arguments about his exercise of the power inthe particular circumstances of this case. For the reasons articulated by the Judge, weconsider there was no breach of natural justice. That takes us to the other grounds ofreview pleaded in the statement of claim.[41] Although the word "disproportionate" is used in the statement of claim, weunderstand it to be an assertion that the decision was irrational.16 In our view, havingregard to the sequence of events which we have detailed above, there is no basis forcontending the decision was irrational. The reasonableness of the decision must beassessed against the background of largely unexplained and unjustified inaction by anapplicant over a significant period of time; the fact that the events at issue dated backto 2014 making timeliness even more important than usual; the fact it had been over ayear since the review application was filed; the hearing had already been adjournedonce; the reviewer had not received the level of co-operation he might reasonably beexpected to have received from the applicant and her lawyer; his directions and theconsequences of non-compliance had been made clear; he gave the parties anopportunity to be heard on whether he should enforce his direction; there would befurther delay if the evidence was admitted; and the evidence was relevant but notpivotal, comprising as it did a retrospective medical assessment.[42] As for the claim that the decision failed to take into account relevant matters,we note that on the face of the final decision of 1 February 2017, Mr Wilson took fivefactors into account:(a) The direction that the evidence must be filed no later than 5pm on19 December 2016 was entirely unequivocal.16 See generally on unreasonableness Associated Provincial Picture Houses Ltd v WednesburyCorporation [1948] 1 KB 223 (EWCA); Wellington City Council v Woolworths New Zealand Ltd(No 2) [1996] 2 NZLR 537 (CA); and Waitakere City Council v Lovelock [1997] 2 NZLR 385(CA).(b) The report dated 19 December 2016 was not filed until16 January 2017.(c) No extension of time for filing was sought.(d) WorkAon objected to the evidence being admitted in breach ofdirections.(e) The review would be delayed for a further three to four months, bywhich time the substantive decision would be almost two years old.[43] We note that of the five factors, two appear on the basis of the evidence to havebeen the fault of Ms Moir's lawyer. We think it distinctly arguable that Mr Wilsonshould have taken that into account and considered whether Ms Moir should bedisadvantaged as a result of something her lawyer did or omitted to do. However, wecannot take that point any further. It was not pleaded. Moreover, because Ms Moirchose not to provide an affidavit there is uncertainty as to the extent of her personalcontribution to the delay. There is no doubt she did personally contribute.[44] The statement of claim does plead two relevant factors which it allegesMr Wilson did not take into account. The first is that he failed to take into accountthat compliance with the directions was not possible (the report only being receivedafter the deadline) and the second that he failed to take into account there was nosubstantial prejudice flowing from the provision of the report on 16 January 2017.[45] As to the first of these, we do not accept that Mr Wilson should have taken intoaccount that it was impossible to comply with the direction. That would be forMs Moir to take advantage of her own wrong.[46] We do however consider there is merit in the second point. The only prejudiceto WorkAon in having the review adjourned to allow further evidence to be called wasthe prejudice that is inherent in any delay. There was no specific prejudice toWorkAon over and above that. In our view, Mr Wilson should have taken the absenceof specific prejudice into account. He did not.[47] Ms Moir's aim in bringing these proceedings however is to havethe Bartle evidence admitted and our conclusion that the decision to exclude it wasreached without reference to a relevant factor will not avail her. If we were to granther a remedy on account of Mr Wilson failing to take the absence of specific prejudiceinto account, it would not be to direct Mr Wilson to admit the evidence. Ratherthe remedy would be to quash his decision to exclude it and require him to reconsiderthe matter afresh taking all aspects of prejudice into account.[48] Not only would re-consideration cause yet more delay it would not in ourassessment result in a different outcome. In our view, even if all aspects of prejudicewere to be taken into account, the outcome would be unlikely to change. Mr Wilsonwould be entitled to focus on general delay and place more weight on the prejudiceinherent in that delay.[49] As for the prejudice to Ms Moir in having the evidence excluded, we considerthis has been significantly overstated both because of the nature of the evidence(a retrospective medical assessment) and also because of Ms Moir's right to an appealin the District Court.17 Mr Beck says there is no guarantee the District Court wouldadmit the Bartle report but we consider that an unrealistic submission. Further inthe highly unlikely event the District Court were to refuse to entertain admittingthe Bartle report, that would be grounds for a further appeal on a question of law. AsEllis J also noted, any argument that Ms Moir would be automatically prejudiced dueto the extra cost and delay involved in the appeal process is necessarily diminished byher own contribution to the delays during the review process.18[50] For all these reasons, we decline to quash Mr Wilson's direction.[51] The parties should now respond forthwith to the inquiry made of them byMr Wilson in the last sentence of his direction of 1 February 2017. The review canthen proceed as soon as possible.17 Accident Compensation Act, s 149(1)(a).18 Moir v IHC New Zealand Inc, above n 1, at [73] n 19.Outcome[52] The appeal is dismissed.[53] Normally costs would follow the event and Ms Moir being the losing partywould be liable to pay costs to IHC. However, Ms Moir is legally aided and we arenot persuaded there are exceptional circumstances under s 45(2) of theLegal Services Act 2011 that would justify an award of costs against Ms Moir. Wetherefore make no award of costs against her.[54] However, Mr McBride requested that we make an order specifying for thepurposes of s 45(5) of the Legal Services Act what costs order would have been madeagainst Ms Moir if s 45 had not affected her liability for costs.[55] We therefore order that but for s 45 of the Legal Services Act Ms Moir wouldhave been liable to pay costs to the first respondent for a standard appeal on a band Abasis with usual disbursements. We would not have certified for second counsel.Solicitors:Peter Sara, Dunedin for AppellantMcBride Davenport James, Wellington for First RespondentMinter Ellison Rudd Watts, Wellington for Second Respondent