Nelson Marlborough Health Services v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT WELLINGTON Decision No. 24 / 99 UNDER The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an appeal pursuant to section 91 of the Act BETWEEN NELSON MARLBOROUGH HEALTH SERVICES (APPELMAN) of Nelson Appellant (Appeal No. DCA 55/98) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARING at CHRISTCHURCH on the 11th day of December 1998 APPEARANCES A J Cadenhead for appellant J Cheyne for respondent RESERVED JUDGMENT OF JUDGE A W MIDDLETON The issue in this appeal arises out of a review hearing in which the Review Officer noted that the issues before her were: (a) whether Appelman's 1993 back injury was a work related injury; and b) if so, were the full costs be attributable to the appellant. 2 The background which gives rise to the appeal is that on 19 February 1993 Appelman (an employee of the appellant) suffered a back injury when he lifted a laundry bag above chest height. He lodged a claim with the respondent in respect of that injury in February 1993. The respondent provided the appellant with a work injury report form which noted that it was to be returned to the respondent by 16 March 1993. The report was completed by the Manager of the appellant's Occupational Health Service and is dated 2 March 1993 and notes that the injury occurred when "lifting full laundry bag" and it is also noted that "prior condition aggravated by subsequent work injury". The employer on that form confirmed that it accepted that this was a work injury. While the file contains numerous medical reports and a further report from Mr OR Nicholson, an Orthopaedic Surgeon, was adduced in evidence at the appeal hearing I have come to a decision on this appeal which does not require me to make reference to the medical issues raised. On 5 October 1994 the appellant advised the respondent that Appelman requested permission to retire on medical grounds. The appellant also requested that from 17 October 1994 the respondent make earnings related compensation payments directly to Appelman. In mid 1996 the appellant enquired from the respondent the position regarding a number of work injury claims involving its employees. The respondent replied by letter dated 9 December 1996 in which it noted that Appelman had had a previous back injury but had been fully employed for twelve months preceding the accident on 19 February 1993 and accordingly that accident was not considered as an exacerbation of the previous injury. The respondent noted that the injury had been accepted as a work related accident. When it received that letter the appellant considered it to be a reviewable decision although the letter did not contain a statement regarding review rights. The appellant then lodged an application for review on 27 November 1996. The application for review indicated that the issue was whether or not Appelman had suffered a work related accident. On 7 January 1997 the respondent notified the appellant's Solicitor that no formal written decision acknowledging a work injury had been accepted and that, therefore, it had not made a decision. The branch considered that it was therefore necessary to issue a decision accepting the claim as a work injury in order for the review application to be activated. On 8 January 1997 the respondent notified the appellant's Solicitor that Appelman's claim had been accepted as a work injury and that the full cost of the claim would be attributed to the appellant for the purposes of experience rating. The matter proceeded to a review hearing. The Review Officer noted that the issue before her was the decision of the respondent in its letter of 9 December 1996 accepting that Appelman had suffered a work injury. In her decision the Review Officer noted that the issue was "whether the 1993 back injury is a work related injury, and if so whether the full costs should be attributed to the appellant." She concluded that the decision of the respondent was correct and that 3 Appelman had suffered a work injury and that the costs should be attributed to the respondent. It is against that decision which the appellant now appeals. When the appeal came before me, the principal issue raised by both counsel was the question of jurisdiction. The respondent submitted that the Review Officer had no jurisdiction to issue the review decision because there was no right of review available to the appellant in relation to the acceptance of the 1993 back injury as a work injury and that the appellant's application for review did not include a review in respect of attribution. The respondent submitted that there was no reviewable decision which had been issued by the respondent. The relevant statutory provisions are: "89. Application for Review---... (2) Any employer who is dissatisfied with a decision of the respondent under section 65 or section 107 of this Act may apply to the respondent for a review of that decision. (4) Any person who is dissatisfied with any decision of the respondent relating to any premium payable or claimed to be payable by that person under this Act may apply to the respondent for a review of that decision; but no such right shall exist under this Act in respect of the calculation for the purposes of the Income Tax Act 1994 of the taxable income of any person. (4A) Nothing in subsection 4 of this section shall confer any right to apply for a review of any decision relating to the entitlement under this Act of any person to any payment or rehabilitation or the making of any payment directly or indirectly under this Act in respect of that person. (5) An application pursuant to this section - (a) May be made in the prescribed form within 3 months after the date on which the claimant is entitled to treat the claim in respect of which the review is sought as having been rejected under section 66 of this Act; and (b) In any other case, an application in the prescribed form may be made within 3 months after the date on which notice in writing has been given of the decision in respect of which the review is sought - and each such application shall state briefly the grounds on which the application is made." "65. Acceptance of work injury claims---(1) Except as provided in subsection (3) of this section, a work injury claim may be lodged with the relevant employer or the respondent. (2) Where any work injury claim is lodged with an employer ..., that employer shall forward the claim to the respondent together with a work injury report as soon as practicable. (4) Where any work injury claim is lodged direct with the respondent, the respondent shall refer a copy to the employer and request a work injury 4 report within 21 days, unless it is a work injury claim to which subsection (7) of this section applies. (6) Where a work injury claim has been lodged and there is a dispute as to whether or not a work injury has occurred, or the employer refuses to supply a work injury report when so requested, the respondent shall determine the matter and advise the parties in writing of its decision. 7) Where any work injury claim involves conduct of a kind described in section 8(3) of this Act, the employee may submit the claim directly to the respondent and request that the respondent not treat the matter as a work injury claim for the purposes of this Act, and the respondent shall comply with any such request and the costs of the claim shall be met from the Non- Earners' Account." "10. General exclusions from cover---(1) For the avoidance of doubt, it is hereby declared that personal injury caused wholly or substantially by gradual process, disease, or infection is not covered by this Act unless it is-- (a) Personal injury caused by gradual process, disease, or infection arising out of and in the course of employment as defined in section 7 or section 11 of this Act; or (b) Personal injury that is medical misadventure; or (c ) A consequence of personal injury or treatment for personal injury covered by this Act. (2) For the avoidance of doubt it is hereby declared that- (a) Personal injury caused wholly or substantially by the ageing process; and (b) Personal injury to teeth that is caused by the natural use of those teeth - is not covered by this Act." This issue appears to have arisen principally through the fact that the respondent had indicated that the costs involved in respect of Appelman would be attributed to the appellant's work history for the purposes of experience rating. Similar issues arose in the case of Cadbury Confectionery Limited (207/98) in which a similar notification had been delivered to that appellant who applied for a review of what it said was the decision regarding attribution. In his decision Judge Beattie found that what the appellant was seeking was to review the decision contained in the Employer Claims History Notification (ECHN) whereas the only decision which could be the subject of a review was the Experience Rating Assessment (ERA) which had not then issued. Judge Beattie held that until the ERA was issued to the appellant there was no decision capable of review pursuant to section 89 of the Act. Judge Beattie then found that the application for review could not be said to be an application of any decision made under section 89(4) of the Experience Rating Regulations because the ERA had not been issued. Judge Beattie then went on to rule that the appellant could not: "seek by review to revisit the fact that the respondent determine (sic) that Ms Pool's injury was a work injury and thereafter treated it as such. There are two reasons: firstly, as I have previously noted no such decision was required 5 because of the acceptance of the fact by the appellant. However, even if there could be regarded as being some form of notional decision by reason of that acceptance, the application for review of that decision was made considerably more than three months after that decision would be deemed to have been made and therefore any right of review is extinguished." Judge Beattie further noted in relation to section 65: "" Section 65 of the Act gives an employer certain rights and safe guards in relation to work injury claims lodged by employees. Subsection 6 requires that where there is a dispute as to whether or not a work injury has occurred, that matter shall be determined by the respondent and a decision in writing given. Such a decision is specifically identified as a decision giving rise to a right of review in section 89(2) of the Act." Mr Cadenhead's principal submission was that in this case, by its letter of 8 January 1997, the respondent had issued a decision which was reviewable. The position is unusual in that by virtue of section 65 the work injury report had been completed by the appellant in which it accepted that a work injury had occurred. That is quite clearly stated in the report completed by the appellant. Moreover, the respondent accepted that report and reimbursed the appellant for the weekly earnings it paid to Appelman until such time as he retired from his position. The query that Appelman had not suffered a work injury only arose after the issue of attribution of costs was raised long after the claim had been accepted as a work injury and certainly well after the three month period in which an application for review is required to be made. Furthermore, the respondent had carried out its obligations under section 65(4) and had received the appropriate report from the appellant within the time required. As provided by section 65(6) no dispute arose as to the nature of the injury because the appellant accepted it as a work injury and it was therefore not necessary for the respondent to issue any further written decision. I respectfully adopt the findings of Judge Beattie in the Cadbury case. I consider that the appellant is now endeavouring to revisit the determination of Appelman's injury outside the time limits imposed by the Act and Regulations. There was no need for the letter of 8 January 1997 to have been issued as the determination was made by the appellant itself in completing the work injury form. It accordingly follows that the decision of the Review Officer must be revoked as she did not have jurisdiction to review the purported decision of either 9 December 1996 or 8 January 1997. It further follows that the second issue relating to attribution of costs could not be the subject of a review and the Review Officer's decision on that issue must also be revoked. 6 The appeal is dismissed. DATED at WELLINGTON this 10th day of February 1999 A W Middleton District Court Judge dea55-98.doc (nr)