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Lump sum compensation

Abou-Haidar v Consolidated Wire Pty Ltd [2010] NSWWCCPD 128. Roche DP. 10.12.10.

  1. Before considering the substantive issues in dispute on appeal, it is appropriate to set out the legislative provisions that govern claims for, and the assessment of, lump sum compensation. Unless otherwise stated, all references below are to the 1998 Act.
  2. In 2001, the 1998 Act was amended to set up a separate and distinct system for resolving medical disputes (Workers Compensation Legislation Amendment Act 2001). The amendments apply to all injuries after 1 January 2002 and, with modifications, to injuries received before that date. Before the amendments, judges usually determined medical disputes, claims for lump sum compensation and claims for further lump sum compensation: Lourdes House Hospital v Wheeler (1996) 13 NSWCCR 495. Since the amendments, AMSs have assessed claims for lump sum compensation under Pt 7 of the 1998 Act. AMSs are not part of the Commission (s 368), but are appointed by the President in accordance with criteria developed by the Minister in consultation with the Council (s 320). 
  3. A medical dispute is defined in s 319(c) to include, among other things, a dispute as to the degree of permanent impairment as a result of an injury. Only the Registrar has power to refer to an AMS a medical dispute concerning a claim for lump sum compensation. This is the effect of s 321(3), which states that the Commission may not refer such a claim, and s 375, which states that, for the purposes of any proceedings (except as provided by that section) the Commission is constituted by an arbitrator. Therefore, the reference to “the Commission” in s 321(3) is a reference to an arbitrator.
  4. The Registrar may not refer to an AMS a medical dispute concerning permanent impairment “where liability is in issue and has not been determined by the Commission” (s 321(4)(a)). The term “liability” is not defined in the legislation, but has been held to include, among other things, whether the worker received an injury within the meaning of the legislation, whether employment was a substantial contributing factor to the injury under s 9A of the Workers Compensation Act 1987 Act (the 1987 Act), and what pathology is said to have been caused by the relevant work incident (Connor v Trustees of the Roman Catholic Church for the Archdiocese of Sydney [2006] NSWWCCPD 124; 5 DDCR 337). 
  5. The degree of permanent impairment of an injured worker is to be assessed in accordance with the WorkCover Guidelines, as in force at the time of the assessment, issued for that purpose (s 322(1)). Impairments that result from the “same injury” are to be assessed together to assess the degree of permanent impairment of the injured worker (s 322(2)). The meaning of “injury” in s 322 was discussed in Department of Juvenile Justice v Edmed [2008] NSWWCCPD 6, where it was stated that injury means injurious event and the pathology that resulted from that event.
  6. An AMS may decline to assess the degree of permanent impairment of an injured worker until he or she is satisfied that the impairment is permanent and that it is fully ascertainable (s 322(4)). Under cl 1.21 of the WorkCover Guidelines, a permanent impairment will be fully ascertainable where the medical assessor considers that the person has attained maximum medical improvement. That is considered to have occurred when the worker’s condition has been medically stable for the previous three months and is unlikely to change by more than three per cent whole person impairment in the ensuing 12 months, with or without further medical treatment; that is, further recovery or deterioration is not anticipated.
  7. In assessing the degree of whole person impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury, or that is due to any pre-existing condition or abnormality (s 323(1)). The assessor is to make no allowance for the possible influence of future treatment or for the possibility of subsequent deterioration in the worker’s condition (cl 4.8 of the WorkCover Guidelines). If a worker’s condition is expected to deteriorate in the longer term, the assessor should make no allowance for that deterioration, but should note its likelihood in the evaluation report. If a worker’s condition suffers long term deterioration, he or she may reapply for further evaluation of the condition (cl 15.10 of the WorkCover Guidelines).
  8. The AMS to whom the Registrar has referred a medical dispute is to issue a MAC (s 325). Such a certificate is “conclusively presumed to be correct” as to, among other things, the degree of permanent impairment of the worker as a result of an injury (s 326(1)(a)). Section 327 provides for an appeal against a medical assessment. One ground on which an appeal may be lodged is “deterioration of the worker’s condition that results in an increase in the degree of permanent impairment” (s 327(3)(a)). However, there is to be no appeal against a medical assessment once the dispute concerned has been the subject of determination by a court or the Commission, or agreement under s 66A of the 1987 Act (s 327(7)). Section 328 deals with the procedure on appeal from an assessment by an AMS.
  9. A matter referred for assessment under Pt 7 may be referred again on one or more further occasions for assessment in accordance with Pt 7, but only by the Registrar as an alternative to an appeal under s 327, or by a court or the Commission (s 329). The Commission considered the operation of s 329 inTarget Australia Pty Ltd v Mansour [2006] NSWWCCPD 286; 6 DDCR 440 and Milosavljevic v Medina Property Services Pty Ltd [2008] NSWWCCPD 56.
  10. If there is a dispute about the degree of permanent impairment, the Commission may not award permanent impairment compensation or pain and suffering compensation unless an AMS has assessed the degree of permanent impairment (s 65(3) of the 1987 Act). 
  11. The procedure for making a claim for lump sum compensation is that a worker must provide relevant particulars about the claim, including, among other things, the injury received and all impairments alleged to have arisen from the injury (s 282). An employer is entitled to require the worker to submit himself or herself for examination by a medical practitioner (s 282(2)). 
  12. A person on whom a claim for lump sum compensation or work injury damages is made must either accept liability and make a reasonable offer of settlement, or dispute liability (s 281(1)). A claim must be determined within one month after the degree of permanent impairment first becomes fully ascertainable, or within two months after the claimant has provided the insurer with all relevant particulars about the claim (s 281(2)). A dispute about a claim for lump sum compensation cannot be referred for determination by the Commission unless the person on whom the claim was made wholly disputes liability, or made an offer of settlement and one month has elapsed since the offer was made, or failed to determine the claim as and when required by the 1998 Act (s 289(3)).
  13. Neither the 1998 Act nor the 1987 Act refer to claims for additional lump sum compensation because of the deterioration of a worker’s condition, or because of an increase in a previously assessed and compensated whole person impairment. Nevertheless, the right to claim such compensation cannot be doubted. The WorkCover Guidelines make express reference to a worker being entitled to re-apply for “further evaluation of the condition” if it deteriorates at a later time (cl 1.24 and 15.10 of the WorkCover Guidelines). Workers must make such claims under the terms of the legislation (s 282) and WorkCover Guidelines, and an insurer either accepts or disputes liability. 

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