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Accident Compensation Cases

McKenzie v Accident Compensation Corporation (DC, 13/10/15)

Judgment Text

Judge A N MacLean
The appellant has applied for leave to appeal a decision of District Court Judge Beattie in McKenzie v ACC1
| X |Footnote: 1
[2012] NZACC 263 
Leave to appeal can only be granted if a question of law can be identified which should be referred to the High Court for resolution. 
The submissions of the respondent correctly summarise the principles applicable including: 
The issue must arise squarely from the decision challenged. 
The contended point of law must be capable of bona fide and serious argument. 
Care must be taken to avoid allowing issues of fact to be dressed up as questions of law. 
It is for the fact finding Court to weigh the relevant facts and provided that Court has not overlooked any relevant matter to take account of some other matter which is irrelevant the conclusion is a matter for the fact finding Court unless it is clearly insupportable. 
Sometimes an error of law can occur where there is no evidence to support a factual decision or the evidence is inconsistent and contradictory of the decision. 
While an appeal is limited to questions in law a mixed question of law and fact is a matter of law. 
Whether or not a statutory provision has been properly construed or interpreted and applied to the facts is a question of law. 
Even if the qualifying criteria are established there is still a discretion so as to ensure the proper use of scarce judicial resources. A factor is the wider importance of any contended point of law. 
Out of the foregoing list, principles in particular which are raised by this application are: 
Whether the way Judge Beattie applied the case of Waenga v Accident Compensation Corporation2
| X |Footnote: 2
[2006] NZAR 396 
was correct. 
Is there a point of principle arising squarely out of the contested decision which could benefit from scrutiny of a higher Court. 
The factual background is not in dispute and without going into unnecessary detail can be summarised as follows; 
The appellant, who is blind, suffered injuries to his left shoulder in a motor vehicle accident in April 2008. Cover was granted for contusion injuries. 
Three months later funding was sought for surgery and declined a few weeks later by the respondent on the basis that the surgery was required to address substantially degenerative changes and not relatable to the accident. 
A review of that decision was not sought but in December 2008 the appellant made fresh application in relation to the same shoulder to the respondent with further medical information to the intent that the injuries went beyond contusion as originally applied for and included injuries to the supraspinatus, infraspinatus, subscapularis, long head of the biceps tendon and gradual process injury for the original accident. The possible relationship with a much earlier covered injury in 1992 (that file had been archived), was also raised. 
The respondent advised it was seeking some further information both in relation to the April 2008 injury and the 1992 injury. However a decision was not made within the statutory two month time frame and a deemed cover decision under s 58 resulted on or about 8 January 2009. 
In the event, following advice from the respondent's Clinical Advisory Panel the following month on 18 February 2009 two letters were sent to the appellant. 
One letter (“the revocation letter”) said under the heading “deemed cover decision revoked”
“As you are aware you have asked the ACC to consider further medical information and issue decisions on additional cover for injuries to the supraspinatus, subscapularis, long head of the biceps tendon and any gradual process on any left shoulder injury that you have cover for. … ACC has now received sufficient information to enable a decision to be made on the substantive merits of the claim that you requested …  
I acknowledge that the timeframes for making a cover decision were exceeded and that you have a deemed cover decision from 8 January 2009 in your favour regarding the above injuries. However the claim is not supported by the evidence and the deemed decision is therefore revoked and the claim for cover for injuries to the supraspinatus, infraspinatus, subscapularis, long head of biceps tendon and any gradual process on any left shoulder injury that you have cover for is declined on its substantive merits. 
Your claim for cover has been declined because the medical evidence does not support the problem … as being the result of your injury of 23 April 2008. The medical evidence also does not support a gradual process condition arising from your injury of 19 January 1992. 
You do continue to have cover for a left contusion injury to the shoulder or upper arm. ”
The other letter (“the confirmation letter”) said: 
“As you are aware you have asked ACC to consider further medical information in relation to the decline of shoulder surgery on this claim which was advised by letter of 30 July 2008. 
ACC has looked carefully at the new evidence and can confirm that the decision of 30 July 2008 remains the same. ”
A number of reviews arose. In brief summary these were dealt with as follows: 
Review 143007 raising an issue of unreasonable delay in processing the original surgery entitlement claim. That was dismissed by the reviewer and that action endorsed by Judge Beattie on the simple ground that by the time the review was heard a decline decision had in fact been issued. That is not in issue in this application. 
Review 143419 regarding whether or not the confirmation letter of 18 February is a new decision or merely confirmed a previous decision. The reviewer upheld the respondent's position as did the District Court primarily by application of Waenga. This issue is relevant in the present application. 
Review 143420 successfully seeking a quashing of the revocation decision contained in the revocation letter primarily on the basis that the reviewer considered insufficient medical investigation had been done. The reviewer's decision concluded with the comment “therefore the original deemed decision stands”. This outcome of this review is relevant to this application but not the subject of appeal in itself. 
While the last review decision was not part of the appeal that Judge Beattie was required to determine nevertheless the implications of that decision form part of the appellant's case in this application. 
The Appellant's Position 
The appellant's proposed questions of law were initially framed on the filing of the appeal in August 2012 as follows: 
If a claimant has cover for injury A and surgery has been declined in relation to that injury, and the claimant then claims for cover and entitlement to surgery for injuries B, C, D and E, is ACC required to make a decision on the additional claim for cover and entitlement? 
How should Waenga v Accident Compensation Corporation3
| X |Footnote: 3
[2006] NZAR 396 
be applied when: 
ACC is provided with further fresh evidence (including MRI scans and evidence from treating health professionals) and 
ACC agrees to consider the matter. 
How should Waenga v Accident Compensation Corporation be applied when there has been a previous decision on surgery but then: 
ACC is provided with further information (including MRI scans and evidence from treating health professionals) and 
Cover is granted for these additional injuries pursuant to a deemed review decision. 
Those submissions were further refined when more detailed submissions were filed nearly two years later as follows: 
If ACC declines a claim for entitlements in relation to covered injury A and then an injured person receives cover for injuries B, C and D relating to the same site of injury and claims entitlements in relation to these injuries is ACC required to issue a fresh entitlement decision? 
Where a claimant challenges a decision through the Part 5 review and appeal process, at what point in time should the factual and legal position be considered? 
Where a claimant successfully challenges a decision by ACC declining cover does the law operate to give that person cover between the date of injury and the date of successful review or appeal. 
As an alternative to question 3, in a situation where cover is in dispute then resolved in favour of the injured person is a fresh claim for entitlement needed that post dates the granting of cover through the dispute process, or is it only required that the claim for cover and entitlements issued contemporaneously. ”
The Respondent Response to the More Detailed Submissions of the appellant 
The respondent notes that the second and fourth questions were not addressed directly in Judge Beattie's judgment raising the issue of whether then the questions posed actually arise squarely out of the decision but submits in relation to the second question that: 
“The correctness of ACC's decision has to be assessed at the time and in the context in which it was made. So when ACC considered the application for entitlements it formed the view that there was no cover available for the second group of injuries and accordingly the application for entitlements were substantially the same as that which had already been determined in July 2008. So that as at 18 February 2009 ACC was simply communicating that it had not altered its earlier position. Following the decision of Waenga that does not amount to a decision which can be the subject of a review. ”
As to the third question the respondent submits: 
“That position is not, altered by the subsequent reversal on review of ACC's decision to revoke the deemed cover. This is particularly the case given the deeming cover positions of the Act (section 58) only apply to cover decisions not entitlement decisions — citing Lee v ACC [2011] NZACC 122. ”
As to the fourth and first questions the respondent submits: 
“Cover having been reinstated it was open to the appellant to apply for entitlements afresh in respect of those injuries and to have that decision reconsidered. However it does not alter the fact that as at February 2009 no decision capable of review had been made. ”
The respondent submissions went on to submit that the real question is whether an error of law has been demonstrated and that: 
“At its simplest the issue that the appellant raises is whether the communication by ACC in its first letter that the entitlement to shoulder injury would not be revised or accepted constituted a new decision, susceptible to review. ”
It further submits that Waenga was directly in point, there was no complicated issue of law but simply an assertion of a fact that, as at the date of revocation, there was no cover in respect of the later claim and that the confirmation letter was not a fresh decision but a simple reaffirmation of an earlier decision so that there is in fact no issue of law requiring determination. 
In further submissions in reply the appellant submits: 
“There is clearly a question of whether Waenga applies after there is a significant factual and legal change to the circumstances, for example when cover is granted for additional injuries which were not considered when making the entitlement decision. In that sense the claim is different because it arises from different injuries to those considered the first time around. As it is a new claim in relation to new injuries then there is a legal question about whether this requires a new decision. ”
In response to the proposition that Waenga applies and was properly applied the appellant cites as authority for a contrary proposition that when cover is added for additional injuries that were not considered as part of the first decision, a fresh decision is made, even if there is some overlap. The cases cited are Hogene v ACC4
| X |Footnote: 4
[2007] NZACC 249 
, Patungata v ACC5
| X |Footnote: 5
[2006] NZACC 104 
and Osborne v ACC6
| X |Footnote: 6
[2006] NZACC 105 
The appellant also submits there is a strong policy reason favouring that approach because otherwise it might: 
“Allow ACC to simply hide behind its first decision. This would result in an abuse of process whereby ACC could simply refuse to issue another decision when the statute clearly requires them to do so. ”
“That it is open for claimants to lodge new claims in relation to new injuries and it is then for ACC to make appropriate fresh decisions with review rights. ”
Further that: 
“Consistency of interpretation would require ACC to make appropriate fresh decisions when claimants lodge fresh claims for cover additional injuries and entitlements to those injuries. ”
Further it submits that the application of a precedent such as Waenga to determine the legal quality of a communication is self evidently a matter of law but, at the very least, it is also a mixed question of law and fact which is sufficient to justify leave to appeal. 
Further that Waenga along with other High Court decisions such as Hawea v ACC7
| X |Footnote: 7
High Court, Napier 2003-441-607 
show that the question of the legal status of a communication as being a decision (or not) is clearly a question of law justifying the granting of leave. 
In support of that proposition the appellant notes Matthews v ACC8
| X |Footnote: 8
[2008] NZACC 269 
where the Court said: 
“The question of whether that letter does or does not constitute a fresh decision which is capable of review is primarily a question of law and requires regard to be had to the definition “decision” in section 6 of the Act and the circumstances in which that letter was written and what it was intended to achieve. Those matters I find are factual matters but which impact on the question of law as to whether or not the subject letter is a reviewable decision. ”
Consequently the appellant seeks to distinguish Waenga and says in any event it does not resolve the dispute. 
The appellant further submits that when Judge Beattie applied the law to the actual factual situation as it existed at the time of the respondent's decision but did not “embrace subsequent developments in the same dispute” that raises an arguable question of law as it was critical to Judge Beattie's decision. 
The appellant submits that the respondent's proposition that the matter is still open for reopening is a “two steps forward, one step back reductive legalistic approach” and that there are substantial matters of statute, case law and policy including equitable considerations which suggest this cannot be a correct interpretation of the law. Further that that was not in accordance with the legislative intention. 
The appellant further submits that it must be the case that where, as here, ACC was proved wrong in its analysis about cover and cover was eventually granted through the disputes process it cannot be right that the appellant has to go back to square one and lodge another fresh application for entitlement when the second application was for both cover and entitlement. 
In conclusion the appellant submits there are seriously arguable questions of law and that the appellant had a valid claim for entitlements at a time when he was covered by the Accident Compensation Act such that it cannot be, and the statute does not conclusively state, that an applicant cannot have a valid claim in that situation. 
Finally that it would benefit both parties to have this matter go to the High Court on the undisputed facts. 
Analysis and Discussion 
The issues which Judge Beattie dealt with, at first blush, appear not to give rise to a matter in the context of this application squarely arising from his decision because in commenting on the deemed cover decision he noted that: 
“The application proceeded separately and the respondent's decision was overturned in a separate review judgment of 19 May 2009. The issue in that review is not part of matters for determination in this appeal. ”
However he then turned to the appeal from review 143419 in respect of the confirmation letter and applying Waenga decided that it was not a decision that could be the subject of review because it just reaffirmed an earlier decision and “the only covered injury which the appellant had was the contusion injuries”. That last comment presupposes that his Honour was looking at the situation as it was on 18 February when the outcome of the review was not known and thus considered that the legal reality as known by the time of the appeal that the deemed cover was reinstated was not relevant. 
He further said: 
“The relevant evidence cannot be regarded as being a situation where new evidence or a new covered decision had been introduced. ”
So that: 
“There was no issue which could be the subject of a review at that point of time. ”
The respondent's position is that Judge Beattie's decision with regard to the effect of the confirmation letter was a straightforward decision on the facts based on Waenga
The appellant's contention is that in fact it is more than that because of what is effectively a decision as a matter of law that there was no issue which could be the subject of review at that point of time. Obviously by that point of time, was meant that point on the day that the revocation letter was sent. In fact although that was the situation on that day, eventually by virtue of the reviewer's decision concluding “the original deemed decision stands” the backdated effect of the review is declarative of the situation as it should have been even though it was not known at the time that would be the outcome. 
Arguably the modified suggested questions of law as they were framed in the second set of submissions are unnecessarily wide. In my view, a question of mixed law and fact arises which essentially focuses on the application by Judge Beattie of Waenga to the facts as he, as a matter of law found them to be.. 
For the foregoing reasons, in my view the appropriate question of law for decision although ultimately it will be a matter for the High Court is based on question 4 in the second set of submissions by the appellant but also incorporating the question as it was put by the respondent: 
“Whether the communication by ACC in its first letter that the entitlement to shoulder injury would not be revised or accepted constituted a new decision susceptible to review. ”
So the question to be answered in my view is: 
“When the respondent on the same day as it revoked the deemed cover, also confirmed an earlier decision, and subsequently that revocation was quashed by a reviewer in favour of the claimant, is a fresh claim for entitlement needed. ”
Accordingly the application is allowed and leave is granted. Although I have attempted to distil what I think is the real question requiring resolution, I accept that the parties may wish to refine or expand this further. 
Costs should follow the event but in my view should be reserved at this stage for determination in due course by the High Court. If however the parties want to be heard further on that matter leave is granted provided that is applied for within one month of this judgment. 

[2012] NZACC 263 
[2006] NZAR 396 
[2006] NZAR 396 
[2007] NZACC 249 
[2006] NZACC 104 
[2006] NZACC 105 
High Court, Napier 2003-441-607 
[2008] NZACC 269 

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