Hauwai v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT WELLINGTON Decision No. 166/98 UNDER The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an appeal pursuant to section 91 of the Act BETWEEN WENDY ELIZA HAUWAI (nee EADES) of Stratford Appellant (Appeal No. DCA 150/98) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD at PALMERSTON NORTH on the 15th day of July 1998 APPEARANCES G A Freeland for appellant S M Rowan for respondent DECISION OF JUDGE A W MIDDLETON The issue in this appeal is whether the respondent was correct to cease payments of weekly compensation to the appellant. The background to the appeal is that the appellant suffered a gradual process injury to her lower back, neck and shoulder region in 1996 while employed as a Tetrapak Operator at Mainland Tui Milk and Foods. The work involved a station position where cartons were filled with milk and sealed. The appellant's job was to monitor the quality of fill-weights and to keep the in-feed magazine stocked. She was 2 declared fully unfit for work for various periods between 1996 and early 1997. When she was able to undertake selected work the assessor had concluded that she would gradually be able to increase her hours of work. On 25 February 1997 the appellant entered into a rehabilitation plan with the respondent. That rehabilitation plan was completed on the respondent's standard RP1 form under which the appellant noted "I agree to comply with all of the plans actions". The formal plan was signed by the appellant on 28 February 1997 and by the appellant's case manager on 25 February 1997. The medical objective of the plan was "to return Wendy as nearest possible to pre-injury level of fitness as possible". The medical action plan and the vocational action plan provided: "Medical action plan: Wendy to attend medical consultations, follow the advice of treatment providers and obtain medical certificates while unfit for work. Wendy to complete treatments as prescribed and approved by ACC. Wendy to inform AC immediately should there be any change in her condition. ACC to request medical report from GP. Vocational action plan: Wendy to fully comply with recommendations made in the work-site assessment. Wendy to inform employer/ACC of any change in her condition. Wendy is not to perform any activity that may aggravate her condition. Wendy must keep her supervisor fully inform[ed] of any difficulties she experiences while at work." The file discloses that in April and May 1997 the appellant advised the respondent of continuing problems as a result of her injuries. On 2 May 1997 the appellant wrote to the respondent notifying it that she had returned to work on the previous Tuesday for 6 hours when she found the lower part of her back was still stiff and she returned to her physiotherapist. She stated that a doctor's certificate was to follow that communication. On 14 May 1997 the appellant's employer notified the respondent that the appellant had resigned from her employment on the grounds that she had been advised by her doctor to do so. A file note made by the appellant's case manager on 15 May 1997 indicated that the case manager had visited the appellant's GP to inquire whether he had advised her to leave her employment. The file note records that the GP explained to the case manager that he had not advised the appellant to leave her employment as he considered she was capable of doing the selected hours and light duties previously decided on. However, he indicated that 3 the appellant told him that she had found another job with less hours which was better suited to her and he had indicated that she should take it if it suited her better. A further file note made by the case manager on 23 May 1997 indicated that the appellant having moved to a new job at a lesser wage wished to claim makeup pay. In a letter dated 23 May 1997 the respondent notified the appellant that the purpose of her rehabilitation plan was to prepare her to return to fulltime employment at Mainland with a view to her becoming financially independent of the respondent. She was advised that as she had chosen to take other employment and remove herself from achieving the goal established in the rehabilitation plan the respondent proposed to cease further responsibility for compensation under s.73 of the Act. The appellant applied for a review of that decision and the review officer concluded that pursuant to s.73(2)(c) the respondent was entitled to decline further payments under the Act because of her failure to comply with her individual rehabilitation programme. It is against that decision which the appellant now appeals. Mr Freeland submitted: 1. That the formal documentation of the rehabilitation plan is binding on both parties. That the plan sets out the various medical and vocational objectives of which I have already referred. 2. That the appellant complied with the terms of the plan in that she attended medical consultations and followed the advice on treatment procedures. 3. That the report provided by Dr Wilson to the appellant's solicitor on 18 November 1997, a copy of which was provided to the respondent on 24 December 1997, indicates Dr Wilson's advice to the appellant in answer to a question posed by her counsel. Dr Wilson stated: "As for your question regarding whether it was medically advisable for her to change her job to one that involved no lifting, yes, definitely. I reproduce below my note of 12.5.97: Mon. 12-May-97 [SW]: can obtain new job doing gentle office work with no lifting ... advised to go for it. I am willing to give note saying I support this on medical grounds. Her current condition is good. And will no doubt remain good if she avoids heavy or repetitive lifting or twisting movements." Mr Freeland submitted that was an unequivocal and unambiguous statement. 4. That the appellant notified the employer of her decision to cease employment as was confirmed by the notification of the employer to the respondent. 5. That there has been no breach of the terms of the rehabilitation plan. 4 6. That if it is held that there was a failure to comply with the plan it was not an unreasonable breach within the meaning of s.73(2). That the appellant ceased the employment on medical advice which could not be considered to be an unreasonable decision. Ms Rowan submitted: 1. That having regard to the decisions of this Court in Hyde (14/98), May (60/98) and Fletcher (18/98), the respondent conceded that while the review officer upheld the respondent's decision to cease payments under s.73(1), the original decision was more properly concerned with a refusal to continue payments under s.73(2). 2. That the appellant's failure to complete her rehabilitation plan was unreasonable having regard to the file memorandum of 15 May 1997 which noted that Dr Wilson had not then advised her to leave, but had indicated that a change to lighter work could be of assistance. Further, that the subsequent report of Dr Wilson conflicted with his earlier statements that the appellant was able to fulfil her tasks with Mainland and further that when she resigned the appellant made no attempt to renegotiate her individual rehabilitation plan with the respondent. This was a clear breach of the plan and that the breach was unreasonable as the appellant's action denied the respondent the opportunity to consider the appellant's situation and reassess the plan. 3. That following the decision in Hyde the appellant's right to receive any payment under the Act is lost while the unreasonable failure persists. That this is compounded by the appellant having left the employment with Mainland so is now unable to comply with the rehabilitation plan. 4. That it appears that the appellant commenced fulltime employment in late 1997 so that any entitlements under the Act would need to be reassessed in the light of her current working status and medical condition. 5. That the decision of the respondent to decline to make payments which in fact was to cease weekly compensation raises the question that if that decision is reversed can the appellant be entitled to weekly compensation and if so, how much? That the loss of earnings for which the appellant now makes claim is not related to an incapacity as a result of personal injury, but to a loss of earnings due to her own personal decision to change employment. The requirement of an individual rehabilitation programme is that it requires the compliance of the appellant. This appellant fully understood the duties imposed on her by the plan and I agree with Mr Freeland's submission that the written specifications in the plan were those to which she was required to adhere. I do not consider that having discussed the possibility of taking a lighter job with her doctor, 5 constituted a breach of the requirements of the medical action plan. Dr Wilson initially indicated to the appellant that if the proposed new work more reasonably suited to her physical abilities, then she should take it. In his letter of 18 November he gave much stronger advice. However, it is clear that his advice to the appellant was stronger than he indicated to the respondent's case manager when she questioned him on 15 May 1997. The doctor's own records made by him after the consultation and produced in full in his report of 18 November 1997 stated "advised to go for it. I am willing to give note saying I support this on medical grounds". This is not in any way contradicted and clearly establishes that the decision to change employment was reasonably made. The vocational action plan section of the rehabilitation plan indicates a requirement to comply with recommendations made in the worksite assessment and a requirement to inform the employer and the respondent of any change in her condition. While it may be implied that the rehabilitation plan contemplated continuing work with Mainland, that is not specified as such. The outcome of the plan is stated to be "to return Wendy to fulltime employment and independence from ACC by May/June 1997" and the medical objectives are stated to be "to return Wendy as near as possible to pre-injury level of fitness as possible". The appellant notified her employer prior to leaving to take a position which was going to provide work more within her then physical ability. While it would have been prudent for her to have suggested to the respondent at that time that she proposed to leave I do not consider that her leaving by itself constituted an unreasonable refusal to comply with her rehabilitation plan. The respondent had discussions with the appellant on 19 May 1997 when it was advised of her change of work, but no effort was then made by the respondent to suggest a renegotiation of the plan to assist the appellant in her rehabilitation. I consider that Mr Freeland's submission that the rehabilitation plan was an agreement binding on both parties and that when the respondent became aware that the appellant proposed to change her workplace, it should have made some effort to consider with her how a new plan or an amendment to the plan could be implemented. This course was not taken. I consider that the review officer did not give sufficient weight to the evidence of Dr Wilson as identified by his own file note recorded when the appellant first approached him on 12 May 1997 with a view to taking alternative work. While the appellant would have been wise to have first asked her case manager what would be the effect on the plan if she changed her job the appellant believed that she was continuing to comply within the plan when she found alternative work more suited to her abilities and was supported by her doctor. I consider that in the circumstances there was no unreasonable failure to comply with the rehabilitation plan nor was there a failure to comply with it. In the circumstances the decisions of the review officer and the respondent are revoked I consider that there was an obligation on both parties to have discussed the appellant's decision to change employment and to revise the rehabilitation programme. Accordingly, if a reasonable period in which to do this would have been four weeks the appropriate date for reinstatement of compensation would be four weeks from 23 March 1997 which would be 20 June 1997. As I understand the 6 appellant commenced on a fulltime basis on 15 November 1997, makeup pay would therefore be required to be made between 20 June 1997 and 15 July 1997. There will be costs to the appellant of $850. DATED at WELLINGTON this 27" day of July 1998 A W Middleton District Court Judge dea15098.doc(rd)