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Accident Compensation Cases

Harris v Accident Rehabilitation and Compensation Insurance Corporation (DC, 14/09/99)

Judgment Text

Judge M J Beattie
The issue in this appeal is whether the respondent correctly assessed the appellant as having a capacity for work pursuant to section 51 of the Act thereby entitling it to cease the appellant's weekly compensation pursuant to section 49 of the Act. 
In November 1980 the appellant was employed as a carpenter by Wilkins & Davies Ltd. He was a month short of his 40th birthday when he suffered an injury to his back during the course of his employment. That injury developed to a lumbar disc lesion and he ultimately underwent a laminectomy. 
The appellant did return to work for a short period in 1981 following the operation on his back but the back problems reoccurred and in August 1981 he was certified as being unfit to return to work as a carpenter. 
In September 1981 he commenced employment with Wanganui Newspapers Ltd as a photo-engraver. In 1982 an assessment as to his permanent disability was carried out and at that time he was still working for Wanganui Newspapers. He was assessed as having a 20% impairment and he was also assessed as having a notional earning capacity with the effect of this being that the respondent made up the balance of his income to its pre-accident level. 
The appellant continued in his employment with Wanganui Newspapers and his normal work schedule was for 40 hours or more per week. The respondent continued making up the shortfall in his wages from that of pre-accident. It seems as though this situation continued on without review or further consideration for a number of years and the only medical information recorded during this time was from the appellant's GP Dr Wilson in April 1992 when he stated: 
No current back symptoms with his present job that involves minimal stress to his back. Prognosis is good considering he has been free of symptoms for the last four to five years. 
No ongoing problems. 
No treatment being provided. 
No present problems. His careful and sensible attitude to looking after his back has resulted in resolution of his symptoms. However, if he was to engage in heavy work, it would be likely that recurrence of his previous symptoms would occur. These were attributable to his accident of 18.11.1980. ”
A file note from the appellant's Case Manager in April 1996 noted that the appellant stated he was quite happy working the hours that he was in the job he was doing. 
In January 1998 the respondent's business manager in Wanganui determined to reassess the appellant's position and in furtherance of that the appellant's Case Manager forwarded a rehabilitation plan to the appellant for signing. That plan had as its goal that the appellant would continue to work as a photo-engraver at the Wanganui Chronicle and become independent of ACC once he had a capacity to work. The Vocational Action Plan contained in that IRP simply identified that ACC would continue to support the appellant until he had demonstrated a capacity to work greater than 30 hours, it being noted that he was not requiring further rehabilitation as his injury had not been a barrier to his ongoing employment since 1981. 
The appellant referred the matter to Accident Compensation Advisors and Mr Rowlett of that firm wrote to the respondent indicating that the appellant was unwilling to sign the agreement at this stage because the Plan did not contain any vocational rehabilitation measures but merely continued the status quo to enable the respondent to comply with the procedures to allow for a work capacity assessment. Mr Rowlett expressed Mr Harris's concern that he felt that he could be made redundant in the foreseeable future. 
The respondent replied to that letter by noting that the Corporation could not be responsible for the claimant losing his job due to new technology or restructuring. It stated that this was a non injury-related matter and that the appellant had shown a capacity to maintain full-time employment. 
A further Individual Rehabilitation Plan was prepared which had as its objective that the appellant would continue in his employment as a photo-engraver for the Wanganui Chronicle whilst being assisted with job search and with the aim to become independent of ACC on 29 May 1998. The appellant signed that IRP on 18 March 1998. 
In furtherance of that IRP the appellant was referred to Roger Peak Couriers Service and suggestions were made as to how the appellant could look for work in various areas. In April 1998 the appellant was referred to Bowling Associates for job placement assistance. A letter from Bowling Associates noted that the appellant was working a 48 hour week and in June 1998 the appellant's Case Manager advised the appellant that he was to be referred to the Work Capacity Assessment process. 
The appellant was referred to an Occupational Assessor for assessment and 12 various job options were identified as being suitable for the appellant, included in those were several positions relating to photography or printing, being the area in which the appellant had gained knowledge and expertise over the past 17 years. 
The appellant was then referred to Dr M S Khanbhai for a medical assessment. Dr Khanbhai noted that the appellant showed no signs of discomfort or physical disability but was distressed at the threat of redundancy and this made him very apprehensive. He noted that the appellant had proven his ability and had a capacity for work. Dr Khanbhai further identified several types of employment that the appellant could undertake and he advised that the appellant was capable of working for 30 hours or more per week performing the tasks identified in the job description by the Occupational Assessor, without causing any further harm to his current condition. 
Following receipt of that advice the respondent notified the appellant on 15 October 1998 that he had been assessed as having a capacity for work and that in accordance with section 49 of the Act his weekly compensation would cease as from 15 January 1999. 
The appellant sought a review of that decision and it was submitted by the appellant's advocate at the review hearing that the respondent had not in fact adhered to the Procedure when determining to assess the appellant under the Procedure. In particular it was contended that the referral of the appellant to be assessed was premature in that the terms of a Vocational Rehabilitation Plan had not been completed before that referral, and secondly the decision to select the appellant for assessment was not done in accordance with the requirements of the Procedure. 
In his decision the Review Officer had glossed over those points and simply stated that the appellant had demonstrated an ability to obtain and remain in employment on his own initiative and the appellant was given the opportunity to explore other employment options. Secondly, the Review Officer found that whilst the WACP 1 had not been signed by the Branch Medical Advisor prior to the procedure commencing, the Review Officer was satisfied that the procedure had been carried out in accordance with the guidelines developed. 
In is essentially those same submissions that have been advanced by Mr Rowlett on behalf of the appellant in this appeal. It is therefore necessary to identify the particular facts upon which those submissions are based. 
As previously noted the appellant signed an Individual Rehabilitation Plan on 18 March 1998, that plan being an amended version of one that had earlier been submitted to him. In that plan each of the actions and time frames referred to a commenced date of 3 March 1998 and an achievement date of 29 May 1998. The final action is stated as being “ACC will monitor and support Terrence whilst he is being assisted with job search until 29 May 1998. At the end of this period ACC will reassess Terrence's needs.” 
The respondent's file shows that by letter dated 20 May 1998 Bowling Associates, who had been instructed by the respondent to assist the appellant with possible job placement, wrote to the appellant's Case Manager stating: 
“After receiving your referral for Mr Harris, Mr Bowling made contact on 27 April 1998 to arrange an interview to discuss job placement. Mr Harris said he thought he was going to be made redundant at the newspapers because of the new technology and it is not a foregone conclusion he doesn't need us. At present he is working a 48 hour week. If things change he will get hold of us for our services. Harvey Bowling asked if he was happy in his employment at Wanganui Newspapers. Mr Harris replied it was a case of ‘having to’. ”
On 2 June 1998 the respondent notified the appellant's advisors that it was commencing the Work Capacity Assessment Procedure having determined that the appellant had completed a rehabilitation programme. 
It is to be noted from the respondent's file however, that the Work Capacity Assessment Procedure 1 form (WCAP 1), which is said to be the work capacity selection criteria, shows that the appellant's Case Manager sought approval of the assessment panel on 24 April 1998. In the section of the form under the heading “Panel Decision” there are two alternatives with a box to tick. The first being: 
The Case Manager is to complete a WCAP 2 (work capacity file summary) and proceed with a Work Capacity Assessment process. 
We have identified potential medical or vocational issues and will discuss these with the Case Manager with a review date on … . ”
The date of 29.5.98 has been written in under (ii). 
Underneath those statements is a place for the signature of the various panel members and for them to date the date of signature. There is a signature of Mr M Shatwell, dated 24 April 1998 and there is a signature of another person, presumed to be a senior Case Manager, whose date of signature is 6 January 1999. Underneath the place where the signatures are to be affixed there is the wording “this must be signed by all panel members including the Branch Medical Advisor”
Dealing now with the Procedure that has been developed by the respondent pursuant to section 50 of the Act. That Procedure came into force in October 1997 having been gazetted pursuant to section 50(4)(f). There is no dispute that the respondent has gone through the correct procedure as set down in section 50 and that there is now a Procedure for the purposes of assessment pursuant to section 51 of the Act. 
In the Procedure it is stated that it has been designed in accordance with the principles of natural justice. By that I take it to be that the principles of natural justice are to be adhered to when carrying out the Procedure. 
On page 12 of the Procedure it sets out the steps to be followed before a claimant is assessed using the Procedure. There it states as follows: 
“A Vocational Rehabilitation Plan is completed and the Case Manager is satisfied that enough rehabilitation has been provided: and 
The Case Manager uses the Selection Criteria form (see Appendix WCAP 1) to seek approval to use the Procedure from the Branch Allocation and Review Panel. 
This internal panel comprises a Branch Medical Advisor and a Senior Case Manager. In larger ACC branches additional expertise from an Occupational Therapist and/or Physiotherapist may also be available. 
The Panel discusses the claimant's situation with the manager. The Panel needs to be satisfied that: 
The Vocational Rehabilitation Plan contains achievable objectives and strategies that reflect the needs assessment or initial evaluation; 
The Vocational rehabilitation Objectives and strategies were specific: 
Alternative job options were identified in the rehabilitation process: 
There is no outstanding medical treatment which would preclude a return to work of 30 or more hours a week. 
When the allocation a review panel approve commencement of the assessment process, the case manager organises a meeting to advise the claimant of the intention to proceed. The claimant has the opportunity to explain why they believe the vocational rehabilitation has been unsuccessful in their getting a job. The case manager records these comments in a file summary that is sent to the assessors. ”
It is then that the Case Manager thereupon sets in train the procedure for occupational assessment and thereafter medical assessment. 
The appendix to the Procedure sets out the various forms numbered WCAP 1-8 respectively. 
For the purposes of this appeal, nothing turns on forms 2-7 as they were completed in the course of carrying out the Procedure for assessment of this appellant. 
The relevant statutory provisions are sections 50 and 51. 
Procedure for assessment of capacity for work — (1) For the purposes of section 51 of this Act, the Corporation shall develop a procedure for the assessment of the capacity for work of persons covered by this Act. 
(5) The object of the procedure is to provide a reasonable method of making assessments under section 51 of this Act. 
(6) The procedure shall not be invalid merely because the procedure disregards- 
Any inability to do anything that does not result from — 
Personal injury covered by this Act; or 
Personal injury by accident in respect of which a claim has been accepted under the Accident Compensation Act 1972 or the Accident Compensation Act1982; or 
Whether or not there are any employment opportunities existing in any employment for which the person is then suited. 
Assessment of capacity for work — (1) For the purposes of determining whether or not a person who is receiving compensation for loss of earnings or for loss of potential earning capacity, or who may have any entitlement to compensation for loss of potential earning capacity, has a capacity for work, the Corporation shall determine the person's capacity for work in accordance with this section. 
(2) For the purposes of this Act, the term ‘capacity for work’ in relation to any person, means the person's capacity to engage in work for which the person is suited by reason of experience, education, or training, or any combination of those things, and that capacity shall be determined having regard to the consequences of the person's personal injury. 
(3) Every assessment under this section shall be carried out — 
In accordance with the procedure for the time being determined by the Corporation under section 50 of this Act; and 
In accordance with the principles of natural justice. ”
I have already identified the principal submissions made by Mr Rowlett. In addition he submitted that it was clear in this case that the respondent simply went through the motions with an eye to commencing the Work Capacity Assessment Procedure rather than genuinely seeking to assist the appellant with vocational rehabilitation. 
Ms Dall, counsel for the respondent, acknowledged that the WCAP 1 form had only been signed by one member of the panel prior to the completion of the Procedure. However she noted there was no mechanism for that panel to review the situation. She submitted that the fact that it had not been signed by more than one panel member did not invalidate the assessment. It was only a technical error and it can be seen from the WCAP 2 form that accompanied it that the appellant was not suffering from any injury related to physical problems in his employment and therefore there was nothing for the Branch Medical Advisor to comment on, ie there were no medical issues to consider. 
She further submitted that full compliance with the Procedure is not required. Provided the interests and rights of the appellant are not prejudiced, substantial compliance is sufficient. She submitted that the fact that section 50(8)(b) allows the Corporation to amend the Procedure without public consultation where the proposed changes are of a minor or technical kind supports this view. 
Section 49 of the Act provides for cessation of an entitlement to receive weekly compensation for loss of earnings where a claimant has been assessed as having a capacity for work. This section effectively overrides the provisions of section 37A which determine incapacity and under which provision a claimant is entitled to weekly compensation. That is stated as being so by section 51(7)(a). 
Thus the Act provides a mechanism whereby a person who is incapacitated can nevertheless have his entitlement to weekly compensation terminated if that person can satisfy another criteria, namely, capacity for work. 
I take it from the provisions of section 50 that the Legislature considered that such a state of affairs should not be brought about lightly and that it was incumbent on the respondent to develop a procedure which would be acceptable in the public interest and in respect of which the public or interested groups would have the opportunity of input before the final version of that Procedure was promulgated. 
That consultative process was carried out and the final version of the Procedure promulgated in October 1997. That document is described as being Work Capacity Assessment Procedure, Final Version. 
Section 51 of the Act sets out the provision for assessment for capacity for work and it is noted that every assessment “shall be carried out in accordance with the procedure for the time being determined by the Corporation under section 50 of the Act.” 
When taken together, the provisions of sections 49 through 51, and the Procedure devised thereunder, constitute a code and certainly in terms of section 51(3) I find that it be mandatory for the respondent to adhere to the provisions of the Procedure when conducting or preparing to conduct an assessment under section 51. 
The whole thrust of the provisions of section 51 and the Procedure are that a person will not be considered for assessment before various objectives of vocational rehabilitation and/or retraining have been carried out and that there appears to be no impediment, either occupational or medical, for that person remaining. This I find is quite understandable in view of the fact that a person so assessed ceases to have any rights to weekly compensation. 
With the consequences being so weighty I find that it is imperative that the spirit and letter of the Procedure be adhered to as is exhorted in section 51(3). 
The Procedure provides for a Branch Allocation Review Panel comprising a Branch Medical Advisor and a Senior Case Manager. There can be other specialists added but not necessarily so. Thus the panel comprises at least two persons. The Procedure states that the panel needs to be satisfied on certain matters and having been so satisfied it approves the commencement of the assessment process. 
In the case of this appellant, the panel did not approve the commencement of the assessment process, or at least it is not shown to have done so by the form that it was required to sign to signify its approval for same. Rather it stated that it had identified potential medical or vocational issues which needed to be discussed with the Case Manager, and that the matter would be reviewed on 29 May 1998. 
There is no evidence that the panel did review the matter, certainly it never reconvened to tick and sign the place on WCAP 1 for approval to proceed with the Work Capacity Assessment Procedure. 
Furthermore I find that, contrary to the submissions of counsel for the respondent, it was the Branch Medical Advisor, Mr Shatwell, who signed the form on 24 April 1998, and it was a Senior Case Manager who did not sign the form until 6 January 1999, rather than the other way round, and that fact is clearly identified from the handwriting and the date on the form. Mr Shatwell has put “24.4.98” next to his signature and the unidentified signature below it has alongside it the date “6.1.99”
Thus the respondent's argument that it was a technical error only because the appellant was not suffering from any injury-related physical problems in his employment and that there was nothing for the BMA to comment on, is not applicable as it was the BMA who had signed the form. However when one considers the complaint of the appellant that his vocational and occupational assistance was not being addressed, it becomes imperative, I find, that a Senior Case Manager examine the various matters that needed to be satisfied from that perspective, as are set out in the Procedure, before the panel could say it was satisfied and thereupon signify its approval for the assessment procedure to commence. There is no evidence that the panel considered those matters and certainly did not indicate on the form that it had done so. 
These omissions I find are fatal to the respondent's assessment of this appellant as having a capacity for work. The assessment was not carried out in accordance with the Procedure and the omissions were matters of substance and went to the heart of the matter. This Procedure I find is a Code and compliance with it is mandatory. A claimant's rights can be drastically affected and I find that such cannot be intended to occur without the Procedure devised by the respondent, as dictated by the Legislature, being strictly adhered to. 
The mere fact that if one put to one side the failure of the respondent to adhere to the Procedure in so far as the preliminary matters I have identified are concerned and that the appellant was correctly occupationally and medically assessed, I find is something that cannot cure that essential defect. 
I consider that the jurisprudence applicable in this field is similar to that which has evolved under the Transport Act in its breath/blood testing provisions, where the fact that a positive breath/blood test has been established cannot cure any defect in the prescribed evidence gathering procedure laid down in the Act or Regulations. 
For the foregoing reasons therefore I find that the respondent's decision to determine that the appellant had a capacity for work and thereby to cease his entitlement to compensation must be revoked. 
The appellant, being successful, I award costs to the appellant in the sum of $1,000. 

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