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Accident Compensation Cases

Williams as Litigation Guardian of Hirama v Accident Compensation Corporation (DC, 29/06/12)

Judgment Text

Judge D A Ongley
This is an application for leave to appeal against two judgments of His Honour Judge M J Beattie Hirama v ACC [2009] NZACC 40 (AI 10/09) issued on 19 March 2009 and Hirama v ACC [2011] NZACC 80 (AI 92/09) on 14 March 2011. 
Both appeals concerned medical misadventure cover for a severely injured young girl who suffered pneumococcal meningitis as an infant of nine months. Her guardians applied for cover for medical misadventure on the ground that a general practitioner failed to recognise the early symptoms and that treatment was consequently delayed. 
The initial decision of the Corporation was issued on 26 November 1996 and granted cover for medical misadventure on the ground of the general practitioner's failure. Under the legislation at the time, medical misadventure required proof of either medical error or medical mishap. Failure by a medical practitioner came under the heading of medical error. Medical mishap was grounded on the rare and severe outcome of proper treatment. 
In this case there was no claim for cover for medical mishap. The judgments accepted that was the position and the appellant has not put forward a claim for medical mishap. But the appellant nevertheless claims that cover for medical mishap was obtained whether it was applied for or not. 
The Corporation's initial decision was notified to the appellant's parents and to the general practitioner and was accompanied by a copy of findings of the Medical Misadventure Panel. Those findings related only to medical error, which the Panel found on the part of the general practitioner. 
The general practitioner applied for review. The application was heard and a review decision was issued on 31 July 1997. The review officer found that there was no medical error on the part of the general practitioner. It follows that there was no basis for cover for medical misadventure as medical error. 
Having reached a decision, the review officer was nevertheless concerned that a claim based on medical mishap could have some merit, and also concerned that the vulnerable claimant should not lose entitlements while that question was decided by the Corporation. The Corporation's initial decision had been notified in separate letters to the parents and to the general practitioner. The review officer made an order that the letter to the general practitioner was revoked, but he did not make a similar order about the letter to the appellant's guardians. Instead, after recording that the applicant had also raised an alternative question of medical mishap for treatment properly given, the review officer said: 
“That aspect [medical mishap] has not been considered by the Corporation and I return the file to it for it to do so and to issue a new decision letter on whether there is cover from medical mishap. 
Cover and entitlements are not stopped by this decision overturning the letter to Dr Gates - cover and entitlements can continue under the separate letter sent to Mileka's parents at that time, pending the new decision on medical mishap, the Corporation will make and address to Mileka's parents. ”
If the doctor was not negligent, the Corporation's decision granting cover had to be quashed. The review officer said: 
“I am well aware that in reaching my decision in Dr Gates' favour on the issue of medical negligence, and if medical mishap is not found, Mileka will lose cover and entitlements under the Act which she has been granted. ”
The appellant says that the effect of the decision was only to exonerate Dr Gates, and that the appellant's cover for medical misadventure was not revoked. The appellant also says that the review officer had no power to refer the question of medical mishap back to the Corporation because that question was not before the review officer. However that is incidental to the main point in the appellant's argument that the review officer did not revoke cover. 
On these leave applications, Mr Barnett for the respondent submitted that there was only one decision by the Corporation and the review officer could not quash that decision in respect of the doctor while preserving it in respect of the appellant. 
Plainly the review officer intended to defer the effect of the decision until the Corporation could decide whether there should be cover for medical mishap. There is no specific provision in the Act to defer the effect of a decision and the review officer probably acted without jurisdiction. The respondent's view is that the review officer effectively quashed the medical error decision with the effect that cover was revoked. In fairness to the claimant, the respondent did not take issue with the expedient of maintaining entitlements until a further decision was made. 
The Corporation then made a further decision on 6 October 1997 declining cover for “medical misadventure” and attaching a report from the Panel which advised that there was no ground for cover for medical misadventure as medical mishap. The appellant says that the Corporation had no power to decline cover for medical misadventure, specifically no power to decline cover for medical error because it had already made a decision in favour of the appellant and the review officer had not disturbed that earlier decision, but had only revoked the Corporation's letter to the doctor. 
The judgment under AI 92/09 was an appeal from a review decision in February 2007 finding that the Corporation validly revoked cover in its decision of 6 October 1997. Judge Beattie recorded that counsel for the appellant submitted that the review officer in 1997 had never revoked cover and that the Corporation had no power to make a new decision without invoking the error provision in s 67A of the 1992 Act, which it did not do. But the Judge agreed with the respondent's argument that it was clear that cover for medical error had been quashed and that entitlements would be terminated unless it could be established that there had been medical mishap. He said in his judgment: 
It has already been determined by earlier decisions that the only decision which the respondent made on 6 October 1997 was a decision that there could be no cover for medical mishap, and thus the combined effect of the review decision and the respondent's primary decision was to preclude cover for medical misadventure generally. At best, for the appellant, it could be said that the decision relating to quashing of cover for medical error did not take effect until the respondent had completed its duties to consider medical mishap and make a decision thereon. 
Accordingly, I find that the Corporation's decision of 6 October 1997 was a decision made within its power and was not a decision in any way seeking to amend its earlier primary decision of 26 November 1996, that decision already having been overturned by the review decision of 31 July 1997. ”
In the application for leave to appeal, Mr Hayes outlined the point of law that the review decision only revoked the decision letter to Dr Gates and that the review officer specifically stated that cover continued under the appellant's decision letter. The Corporation then purported to revoke the cover that the review officer had continued, doing so without authority and without invoking s 67A, for which there was in any case no evidence. It is said that the judgment was in error on those points. 
The appellant has not claimed that there was any error of law in the Judge's substantive findings that there was no medical error. 
The judgment under AI 10/09 was a late appeal by the appellant, pursuant to leave, against the substantive finding in the 1997 review. The appellant wanted to challenge the review officer's substantive findings, but also wanted to preserve the argument that the review officer had not in the end revoked cover. The ground for leave to appeal is that the judgment of the District Court on the question of medical error wrongly assumed or found that the review officer had revoked cover for medical error. 
Both intended appeals concern the same points of law, which were set out in Mr Hayes' submissions as follows: 
“Did the 31 July 1997 review decision revoke the appellant's cover? 
Pursuant to ARCIC s 145 did the Reviewer have the power to require ACC to make a new decision on a matter not under review? 
For AI 92/07 
Did the 6 October 1997 decision revoke cover for medical error? ”
The respondent submits that, first, the questions do not raise matters of law capable of serious and bona fide argument, and secondly, in any event, in the exercise of its discretion, the Court should refuse to grant leave. The respondent's argument was put as follows: 
“The Corporation submits that it is plain from the decision and direction of the review officer that he had determined medical error was not established and that being so, there would only be cover for medical misadventure if the Corporation were to now determine that there was medical mishap. No serious and bona fide question of law arises. (If there was anything ultra vires or erroneous in the review officer's decision, it was to purportedly direct that cover would continue in the meantime pending the Corporation's decision on medical mishap. But of course the appellant does not assert that as an error.) 
The direction that medical mishap ‘has not been considered by the Corporation and I return the file to it for it to do so and to issue a new decision letter on whether there is cover from medical mishap’ is the subject of the appellant's second question. The Corporation submits that there can be no bona fide and serious question of law that the review officer was entitled to require the Corporation to consider the question of medical mishap and which was plainly not a matter it had addressed in its primary decision (no doubt because the Corporation, having accepted cover on the basis of medical error, considered that it was unnecessary to go on to decide whether there had been medical mishap). ”
I agree that the meaning of the review officer's decision was perfectly clear. The central question is whether it had the effect of quashing or revoking the Corporation's decision. 
The 1992 Act did not contain the same prescriptive provisions for the hearing and determination of reviews. Under s 90 of that Act, the outcome of a review was described in the following way: 
Notice of the decision on the application shall be given, in writing, to any person entitled to appeal against the decision, the applicant, and the Corporation within 28 days after the conclusion of the hearing and the notice shall state the reasons for the decision made. 
Where the [review officer] has not, within 28 days of the conclusion of the hearing, advised the applicant of his or her decision confirming, modifying, or revoking the original decision, the applicant shall be entitled to treat the original decision as having been confirmed, and may appeal against that decision under section 91 of this Act. ”
There was no accompanying provision requiring the review officer to select between various outcomes as there is under s 145 of the 2001 Act. Under subs (8) the decision had to confirm, modify or revoke, but the essential requirement was for a decision, not for a specific order giving effect to the decision. 
In the case the review officer made a decision that there was no medical error. The express terms of the legislation did not require him to make a formal order stating that the Corporation's decision was revoked. It was enough to make a decision with that effect. Clearly that is what the review officer did, but he also decided (arguably without power to do so) that the effect of his decision would be delayed until the Corporation decided on teh question of medical mishap. 
Whether or not the review officer had power to direct the Corporation to make a decision on medical mishap is irrelevant to the present situation. The Corporation had never made such a decision and could do so subject to ordinary requirements for its decision making. It did not need a direction. The appellant argues here that the Corporation had already made a decision on medical misadventure, which included both error and mishap. That argument is plainly unsound because the Corporation's reasons for its first decision related only to medical error. 
For those reasons, I conclude that there is no fairly arguable question of law arising from either of the judgments delivered by Judge Beattie. On the first and most important point of law that has been raised in this application, I find that the review officer made findings and made a decision that there was no medical error, and that cover was not available for medical error. The legislation did not require a particular form of words, but required a decision. The meaning of the decision was plain and could only have one effect, that was to revoke the Corporation's cover decision. 
On the second point, the review officer did not exercise a statutory power, but merely referred a question back to the Corporation for a further primary decision. The Corporation had the power to make a decision on medical mishap. That decision was only required once the review officer had decided that treatment was properly given. Finally, the Corporation's decision declining cover for medical mishap did not touch on the question of medical error which had been decided by the review officer. 
The consequence of the claimant's illness was devastating for her and her family. But the review officer in 1997 and the Judge in 2007 considered the medical evidence with care and could not reach a finding of medical error. Regrettably, leave to appeal to the High Court is refused. 

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