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Ilich v Accident Compensation Corporation (HC, 25/10/06)

Judgment Text

JUDGMENT OF STEVENS J 
Stevens J
Introduction 
[1]
This is an application for special leave to appeal to the High Court on questions of law under s 162(3) of the Injury Prevention, Rehabilitation and Compensation Act 2001 (the Act). 
[2]
The appeal arises from a decision by the respondent Accident Compensation Corporation (the Corporation), that the appellant, Mr Ilich, was not entitled to weekly payments of compensation after 2 October 2002 on the basis that he was able to engage in the employment in which he was employed when he suffered personal injury. The appellant had sustained the injury in 2000 following which he received compensation. The decision of the Corporation determining that he was able to engage in pre-injury employment was subsequently confirmed by a reviewer and later by a District Court Judge on appeal. An application for leave to appeal to this Court was refused by the District Court leading to the present application. 
[3]
The application for leave raised ten points on appeal. But, as the hearing on the leave application developed, these were condensed down to four main points. 
These may be summarised as follows: 
a)
Whether the assessment undertaken by the medical practitioner for the Corporation under s 102 of the Act was flawed; 
b)
Whether the referral letter of the Corporation to such medical practitioner was misleading or vitiated by a “negligent misrepresentation”
c)
Whether the assessment provided by such medical practitioner was vitiated by bias; and 
d)
Whether information supplied to the appellant's medical practitioner on behalf of the Corporation was misleading. 
Background facts 
[4]
The appellant sustained a fracture to his left ankle on 19 July 2000 on a construction site at South Auckland. At the time of the injury, the appellant was a shareholder employee involved in a painting business in which his role was that of a contract manager. The appellant was certified unfit for work and began receiving weekly compensation. In January 2001, the appellant sold his shares in the painting business and the contract with the vendor included a restraint of trade clause which prevented the appellant from working in the painting trade for three years. 
[5]
The history of the recovery by the appellant from his ankle injury and the reports of various medical practitioners concerning his progress is conveniently summarised in the decision of the District Court Judge who heard the appeal from the reviewer. Counsel for both the appellant and the Corporation accepted that the outline given in paragraphs [2] to [18] of the reserved judgment of Judge Cadenhead was in broad terms correct. The same is true with the summaries given of the medical reports in paragraphs [19] to [33] inclusive. Mr Minchin for the appellant accepted that such descriptions given by the Judge were “a fair summary”
[6]
For the purposes of this application for special leave, the key reports are first the medical assessment report given by Dr Chew, an occupational medicine specialist, commissioned by the Corporation under s 102 of the Act. Dr Chew had received a letter from the Corporation asking him to carry out an assessment of the appellant and answer eight specific questions. Second, there were several reports by Mr Tomlinson, the orthopaedic surgeon who treated the appellant and reported back to Dr Laud, the appellant's general practitioner. Counsel for the appellant referred to three of Mr Tomlinson's reports given on 5 February 2002, 2 July 2002 and 14 August 2002. It was submitted that “despite ongoing inquiry it remained unclear as to whether ACC failed to provide [these] reports to Dr Chew or whether Dr Chew omitted to refer to these reports”. Because of this, it was said that Dr Chew's assessment was flawed. 
[7]
The final report of relevance to this application for special leave is the material supplied by Dr Laud to the Corporation post 27 August 2002. This is in the form of handwritten answers to a questionnaire concerning the appellant's injury and capacity to work. The appellant's counsel raised concerns about the accuracy of the information provided by the Corporation in this document, particularly in relation to question 10. It is noted that the District Court Judge considered this questionnaire as it was referred to in paragraph [78] of his judgment. 
Decision of the Corporation and the review 
[8]
The decision of the Corporation determining the question of incapacity of the appellant under s 103(1) of the Act was made on 3 October 2002. The issue for determination is set out in s 103(2) of the Act as follows: 
“The question that the Corporation must determine is whether the claimant is unable, because of his or her personal injury, to engage in employment in which he or she was employed when he or she suffered the personal injury. ”
[9]
The effect of such a determination by the Corporation is provided for in s 104 of the Act as follows: 
Effect of determination under s 103 on entitlement to weekly compensation 
If the Corporation determines under section 103(2) that the claimant is not incapacitated for employment - 
(a)
a claimant who is receiving weekly compensation for loss of earnings from employment - 
(i)
loses that entitlement immediately; and 
(ii)
cannot be subject to a determination under section 107 in respect of that incapacity: 
(b)
a claimant who is not receiving weekly compensation for loss of earnings from employment is not entitled to begin receiving it. ”
[10]
The Corporation has power to suspend or cancel an entitlement where it is not satisfied that a claimant is, on the basis of information in its possession, entitled to continue to receive the entitlement: see s 117 of the Act. Following the suspension of the appellant's weekly payments, the appellant on 28 December 2002 filed an application for review with the Corporation. One of the grounds raised in such application was that the decision was based on a “flawed and biased occupational specialist report which clearly signalled partiality to ACC”
[11]
The review was carried out by a reviewer under the provisions of the Act. There is a convenient summary of the review hearing in paragraphs [48] to [55] of the judgment of the District Court. The application for review was dismissed by the reviewer in a written decision dated 8 July 2003. Subsequently, the appellant appealed to the District Court under s 149 of the Act by notice of appeal dated 6 August 2003. 
The decision of the District Court 
[12]
The appeal was heard by Judge Cadenhead on 12 July 2005 at which the appellant was represented by his advocate, Mr R A Ilich. The Judge reserved his decision and delivered a 22 page written judgment comprising 86 paragraphs on 9 August 2005. 
[13]
Relevant to his application for special leave, the District Court Judge carefully considered the assessment undertaken by Dr Chew, together with the three reports of Mr Tomlinson which the appellant complains were either not referred to Dr Chew by the Corporation, or not specifically mentioned by Dr Chew in his own report. The Judge in fact had the nine reports of Mr Tomlinson before him, including a report dated 24 September 2002: see paragraph [31]. This report was addressed to Dr Laud and stated: 
“Mr Ilich returned for further review today. I went over his MRI scan again. There is certainly fluid within the ankle and subtalar joint, some bulging posteriorly, and possibly some irregularity of the posterior talus although we have looked carefully at this area and found predominantly that this was due to a synovial shelf protruding into the joint which was resected. There is nothing in the anterolateral aspect of the ankle to suggest a cause for his ongoing discomfort other than mild inflammation. 
At this stage I cannot offer him anything further but I have reassured him whatever problems he has there is no underlying serious pathology other than the findings mentioned above and it is not likely to be a severe problem in the future. He is looking at training in another occupation which I think is wise if he cannot handle the rough ground at building sites. 
I am happy to see him if his symptoms deteriorate in the future, otherwise I will leave him in your hands for further follow up. ”
[14]
The Judge also had before him the questionnaire and answers provided by Dr Laud. This questionnaire is the subject of the fourth point of appeal: see paragraph [3](d) above. 
[15]
The appellant's counsel fairly acknowledged that the District Court Judge addressed the correct legal question for determination. This is clear inter alia from paragraphs [1]] and [86] of the judgment. It is noteworthy too that the Judge considered other material than the medical reports and assessments. Such material included evidence from a private investigator and an independent witness who viewed the appellant painting his son's house in or about mid 2002. This and other material relied upon by the Judge is mentioned at paragraph [80] of the judgment. 
[16]
With respect to the question of bias, the Judge carefully considered the legal test for bias and reviewed the legal authorities which established the principles by which he was required to assess whether Dr Chew's assessment was biased: see paragraphs [44] to [47]. Importantly, the Judge emphasised that the test is whether there is a real danger of bias and noted that, in applying this test, the Court must consider all of the circumstances which are to be objectively taken into account. He noted that, if there were any “injudicious” remarks in a report, this might go to the weight to be given to it. 
[17]
Having considered the matters summarised above, the District Court Judge reached the following conclusions: 
“[82]
I have stood back and analysed in context all the evidence, including the medical and the other evidence such as to the appellant's activities in painting his son's house. The test in the 2001 legislation is much broader than in the previous legislation. I have balanced the evidence of Mr Tomlinson against the evidence of Dr Chew and the general practitioner. 
[83]
In respect to the evidence of Dr Chew I think read in context his medical report was not biased, nor was the letter of instruction from the respondent. He was stating the facts as he believed them to be. There may have been the odd remark that was wider than it should have been, however, read as a whole his report seems to be a fair assessment of the physical capabilities of the appellant. Similarly, the observation of Dr Emrys was not unremarkable, although this report was given before the arthroscopy. 
[84]
The respondent was entitled to rely upon the evidence that it received from its private investigator for the purposes of this claim, and the issues of privacy do not prohibit the use of those materials. It seems that the only real dispute concerning the activities of painting the house is a qualitative one as to the extent of the work done. 
[85]
My only concern in this case was the medical opinions of Mr Tomlinson. However, read in context over the period of time that he was reporting I find that I am not persuaded to a probability basis that it is shown that the appellant did not have the capacity to perform his pre-accident employment, rather the contrary. Mr Tomlinson appears to be at a loss as to the continuing symptoms having regard to the pathology of the ankle. 
[86]
I find on a consideration of the whole of the evidence before me that the appellant has not shown on a balance of probabilities that he was unable because of his personal injury, to engage in employment in which he was employed when he suffered the personal injury. I can find no reasons for disagreeing with the views of the reviewer. For the reasons that I have given I would dismiss the appeal. There is no order as to costs. ”
Leave to appeal declined by District Court 
[18]
The appellant filed in the District Court an application for leave to appeal to the High Court dated 29 August 2005. Such application for leave was declined by Judge Barber in April 2006. This decision was itself eight pages long and comprised 25 paragraphs of reasoning. Importantly, each of the four points advanced during this hearing were fully considered by Judge Barber. These points were analysed against the test outlined in two cases, Ogilvy v Mather (New Zealand) Ltd v Turner [1996] 1 NZLR 641 (CA) and Impact Manufacturing Ltd v ARCIC HC WN AP266/00 6 July 2001, Doogue J. Judge Barber concluded that: 
“In my view, none of the appellant's grounds (a) to (d) raise a point of law which is capable of bona fide and serious argument in terms of Judge Cadenhead's reasoning and under the test in Impact Manufacturing Ltd v ARCIC. ”
[19]
With respect to the assessment by Dr Chew, Judge Barber concluded that the disapproving comments (such as they were) did not show any actual bias. Moreover, there was not a sufficient basis to infer apparent bias. In this regard, he concluded that Judge Cadenhead had correctly applied the proper test for bias, namely, whether there was a real danger of bias. 
[20]
The final matter considered by Judge Barber was the argument that Judge Cadenhead had correctly preferred the opinions of Drs Laud and Chew to Mr Tomlinson the orthopaedic surgeon. Judge Barber considered all of the material, including the various medical reports which had been before the District Court, and then concluded as follows: 
“[24]
The appellant submits that the District Court erred in upholding the respondent's decision that the applicant was no longer incapacitated as at 3 October 2002. Judge Cadenhead's conclusion (at his paragraph 86) involves questions of fact (principally, the Court's acceptance of various medical evidence) which were reasonably supported by the evidence before the District Court. The appellant is merely seeking to disturb the Court's reasonable findings of fact. The applicant/appellant has failed to show any issue of law in the said District Court decision. 
[25]
Accordingly, the application for leave is hereby dismissed. ”
Application to High Court for special leave 
[21]
The appellant then through his counsel filed an application for special leave to appeal to the High Court in May 2006. This application was essentially a rerun of the various points raised before Judge Barber. Before considering whether this is a case where it is appropriate to grant special leave, it is convenient to outline the test to be applied by the High Court. 
[22]
As noted above, this application was made under s 162(2) of the Act. Prior to the passing of the Act, the provision governing special leave was s 165(3) of the Accident Insurance Act 1998 which was essentially in similar terms. That section was considered in Kenyon v Accident Compensation Corporation [2002] NZAR 385. The key points from that case regarding the test for granting special leave to appeal on points of law are as follows: 
a)
It is ultimately a matter for the discretion of the Court, but it is necessary for the applicant to show that there is an issue of principle at stake or that a considerable amount hinged on the decision and that there was a reasonable prospect of success; 
b)
Leave ought not to be granted as a matter of course as special leave is significant; 
c)
The applicant must show that leave is required in the interests of justice; and 
d)
Where leave has been refused by the District Court, the applicant will be required to show that some extraordinary factor has not been properly taken into account. 
[23]
The applicable test was conveniently set out in the decision of Fisher J as follows: 
“[15]
In his helpful submissions Mr Corkhill summarised the effect of the authorities relating to special leave as follows: 
(a)
The purpose of requiring leave for certain appeals is to ensure that scarce judicial time is allocated sensibly: Sandle v Stewart [1982] 1 NZLR 708 (CA). 
(b)
Although it is ultimately a matter for the discretion of the Court, it will normally be necessary to show that there is an issue of principal at stake or that a considerable amount hinges on the decision, and that there is a reasonable prospect of success: Sandle, Manawatu Co-operative Dairy Co Ltd v Lawry [1998] DCR 509, Brown v Chow Mein Fashions Ltd (1993) 7 PRNZ 43
(c)
The fact that special leave is required is significant and suggests that leave ought not to be granted as a matter of course: O'Loughlin v Healing Industries Ltd (1990) 2 PRNZ 464
(d)
It is for the Applicant to show that leave is required in the interests of justice: Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 (CA). 
(e)
As leave has already been refused by the District Court, however, there will normally have to be some extraordinary factor which has not been properly taken into account: Brown v Chow Mein Fashions Ltd. ”
Both counsel accepted that the above principles were applicable to this application for leave. Counsel also acknowledged that the only issue before the Court was whether or not special leave should be granted in the circumstances of this case. 
Did the District Court Judge err in law? 
[24]
For the appellant, Mr Minchin properly accepted that this was not a case where there was no evidence before the District Court Judge to support the critical decision of capacity or incapacity under s 103(2) of the Act. Hence, this is a case in which the High Court considering an application for special leave should apply the principle in Ogilvy & Mather (NZ) Ltd v Turner at 646. This is that, where an appeal is limited to questions of law, factual findings may only be reviewed by an appellate Court where the findings are made in the absence of any evidence which could reasonably support them. Such an acknowledgement by the appellant is plainly relevant to the point noted in Kenyon that there must be a reasonable prospect of success on appeal. 
[25]
It was also acknowledged by the appellant that the District Court Judge properly formulated the question for determination under s 103(2) of the Act. This point too is relevant to whether the appellant can demonstrate reasonable prospects of success on any substantive appeal. 
[26]
With respect to the point that Dr Chew, when making his assessment, either did not have or did not refer to three reports of Mr Tomlinson, Mr Tuiqereqere for the Corporation, argued that this was not a basis for granting special leave. He submitted that, irrespective of what material Dr Chew had or did not have (and there is an inference available from the Corporation's letter of instruction that he did have the three reports), certainly all relevant reports by Mr Tomlinson were before the District Court Judge. I agree. In that way, any relevant impact from Dr Chew not having the report, if that were the case, would have been corrected. 
[27]
Mr Tuiqereqere submitted, correctly in my judgment, that the issue for determination by the Corporation, the reviewer on review and the District Court Judge on appeal was not just a medical one. The various medical reports and assessments informed the relevant decision-makers in their respective tasks. But, in making a determination of ability to engage in pre-injury employment under s 103(2), a range of other factual matters will arise and be relevant to the decision-making exercise in addition to the contents of the medical reports. 
[28]
Counsel submitted that such decision-making is a factual determination once the correct statutory test has been framed. Accordingly, it was inappropriate for the High Court to grant special leave in respect of matters which are essentially factual and involve the weight given by the District Court Judge to particular reports on other evidential material. Mr Tuiqereqere submitted that all the relevant reports of Dr Chew and Mr Tomlinson were before the District Court Judge and there was no basis for the grant of special leave. 
[29]
With respect to the referral letter to Dr Chew dated 5 September 2002, it was submitted that this was merely contextual. It was entirely proper that the Corporation should mention (correctly) that it had received information which indicated that the appellant had been witnessed “climbing up a ladder and painting a house”. Quite apart from this point, when the matter came before the District Court Judge, he had access to the private investigator's report and other evidence relating to this issue and it was referred to in his judgment. 
[30]
With respect to the information provided to Dr Laud in the questionnaire, Mr Tuiqereqere submitted that it was not false or misleading. Whilst it may not have been precise, there is other evidence which was before the Court which showed a sufficient basis for the statements made. Counsel referred me in particular to a transcript of a taped interview with the appellant which was some 36 pages long. This transcript was also available to the District Court Judge and provided an adequate, and detailed, factual basis for the statements regarding the painting activities which the appellant had been carrying out over several weeks on his son's house in 2002. Again, these are factual matters which were properly before the District Court Judge and were plainly taken into account in his judgment. 
[31]
Finally, Mr Tuiqereqere referred to the question of bias. He submitted that the District Court Judge applied the correct test for bias. This is confirmed by the two authorities which were referred to by Mr Minchin: Bakker v District Court at Te Awamutu HC HAM CP35/99 6 August 1999, Tompkins J; and Lamb v Massey University CA241/04 13 July 2006. In particular, in the latter case at paragraphs [23]-[24] Allan J referred to an earlier Court of Appeal judgment in R v Jessop CA13/00 19 December 2005 in which it had been confirmed that the test to be applied in New Zealand in determining whether a Judge is biased is that enunciated in R v Gough [1993] AC 646. This was the decision which had been applied by the District Court Judge. 
[32]
With respect to the factual determination by the District Court Judge on the question of bias, Mr Tuiqereqere submitted that this was more an issue of reliability and weight to be put on Dr Chew's assessment. He submitted that the District Court Judge correctly weighed the evidence and concluded that, when read in context, Dr Chew's medical assessment was not biased. Neither was the letter of instruction to him from the Corporation. He submitted that these factual findings were clearly open to the District Court Judge in all the circumstances. I agree. 
Decision 
[33]
I consider that the assessment of capacity or incapacity under s 103(2) of the Act is a question of fact. In this regard, I note that a similar view was expressed by Randerson J: see McCafferty v Accident Compensation Corporation HC AK CP248/01 11 April 2002 at [40]. Having carefully considered the judgment of Judge Cadenhead, I am satisfied that the correct factual questions have been fully examined and determined by the District Court Judge prior to the matter reaching this Court. In my judgment, the findings of fact which were made by the District Court Judge were clearly open to him on the evidence. Moreover, I can find no basis in the material presented by Mr Minchin for the appellant as providing any basis for an error of law in the District Court judgment. 
[34]
I have also had the benefit of considering the detailed judgment of Judge Barber when an application for leave was made in the District Court. I agree with the conclusions which he reached. In considering the application in this Court, and after considering all of the written submissions filed on behalf of the appellant and the Corporation, as well as considering the additional material submitted by Mr Minchin during the hearing, I am unable to find that the test for a grant of special leave has been met. 
[35]
In particular, I do not consider that there is a reasonable prospect of success on further appeal. Moreover, I do not consider that, in this case where leave has already been refused by the District Court, the appellant has been able to show some extraordinary factor which has not been properly taken into account. 
Conclusion 
[36]
Accordingly, for the reasons set out above, I conclude that the appellant has not demonstrated that the decision of the District Court Judge was wrong in law. The application for the grant of special leave to appeal to the High Court must therefore be dismissed. 
[37]
As indicated by counsel for the Corporation at the hearing, in the event that special leave is not granted, costs were not sought by the Corporation. I make no order as to costs. 

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