Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: Hancock v East Coast Timber Products Pty Limited [2011] NSWCA 11
• Hearing dates: 9 July 2010
• Decision date: 15 February 2011
• Before: Beazley JA at 1; Giles JA at 111; Tobias JA at 112

Decision

1. Appeal allowed;

2. Remit the matter to the Workers Compensation Commission for redetermination in accordance with law.

3. The respondent to pay the appellant's costs of the appeal.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: WORKERS' COMPENSATION - error in point of law - wrong application of principle in Makita - failure to afford procedural fairness; WORKERS' COMPENSATION - practice of the Commission - determination of the matter on the papers where credit issues involved
• Legislation Cited: Evidence Act 1995; Workers Compensation Act 1987; Workplace Injury Management and Workers Compensation Act 1998
• Cases Cited: Adler & Anor v ASIC [2003] NSWCA 131; (2003) 46 ACSR 504; ASIC v Rich & Ors [2005] NSWCA 152; (2005) 54 ACSR 326; Brambles Industries Limited v Bell [2010] NSWCA 162; Fletcher International Exports Pty Ltd v Lott [2010] NSWC 63; Hevi Lift (PNG) Ltd v Etherington [2005] NSWCA 42; HG v R [1999] HCA 2; 197 CLR 414; Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298; Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 705; Paino v Paino [2008] NSWCA 276; Paric v John Holland (Constructions) Pty Ltd [1985] HCA 58; 62 ALR 85; Ramsay v Watson [1961] HCA 65; (1961) 108 CLR 642; Re Refugee Tribunal & Anor; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82; Rhoden v Wingate [2002] NSWCA 165; Rich & Anor v ASIC [2005] NSWCA 233; South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16; Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141; Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Limited [2002] FCAFC 157; SZBYR v Minister for Immigration and Citizenship [2007] HCA 26; (2007) 235 ALR 609; Waterways Authority v Fitzgibbon [2005] HCA 57; (2005) 221 ALR 402
• Category: Principal judgment
• Parties: Daniel John Hancock (Appellant); East Coast Timber Products Pty Ltd (Respondent)
• Representation: Counsel: S Campbell SC; R Harrington (Appellant); P Webb QC; D Baker (Respondent); Solicitors: Lee Sames Egan (Appellant); Mulcahy Lawyers (Respondents)
• File Number(s): 2009/326361

Decision under appeal

• Citation: East Coast Timber Products Pty Ltd v Hancock [2009] NSWWCCPD 123
• Date of Decision: 2009-10-06 00:00:00
• Before: President, Judge Keating
• File Number(s): A1 - 10105/08

Headnote

The appellant, who was employed by the respondent as a labourer, fell and injured his knee whilst stacking timber in the course of his employment. There were no witnesses to the appellant's fall and he did not report the incident: [15]. The appellant was off work for a few days after the incident but thereafter continued to work for another two and a half years, save for various periods of sick leave, before remaining permanently off work on sick leave. The respondent terminated the appellant's employment six months after. The appellant claimed that he suffered from permanent incapacity as a result of the injury sustained in the work incident.

Procedural history and issues on appeal

The matter first proceeded before an Arbitrator in the Workers Compensation Commission who made an award of weekly compensation in favour of the appellant. On appeal from the Arbitrator, Keating DCJ, President of the Workers Compensation Commission of NSW, revoked the Arbitrator's decision on the basis that the appellant had failed to discharge the onus of proving that his permanent incapacity resulted from the original injury sustained at work. Integral to this conclusion was his Honour's rejection of the evidence of the appellant's treating orthopaedic surgeon on the basis that the surgeon failed to consider the effect of subsequent non-work related activities undertaken by the appellant and did not provide a scientific basis for his opinion that the work incident was the cause of the appellant's incapacity.

The appellant appealed from Keating DCJ's decision, pursuant to the Workplace Injury Management and Workers Compensation Act, s 353(1), contending:

(i) in finding that no weight could be placed on the evidence of the surgeon, the trial judge wrongly applied the principles governing expert evidence, and in particular, the principle in Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; 52 NSWLR 702 : [10];

(ii) the trial judge's failure to place weight on the evidence of the surgeon constituted a breach of procedural fairness: [11];

(iii) the trial judge erred in failing to draw a Jones v Dunkel inference in the appellant's favour in circumstances where the respondent had failed to tender the report of its own medical expert: [12];

(iv) the trial judge misdirected himself in law on the issue of causation by failing to ask whether the injury sustained in the work incident rendered the appellant susceptible to the effect of further injury and permanent incapacity: [13].

Held

Per Beazley JA (Giles and Tobias JJA agreeing): Appeal allowed.

(i) The principle in Makita , as explained by Spigelman CJ in ASIC v Rich, is that there is no requirement for an exact correspondence between the assumed facts upon which an expert opinion is based and the facts proved in the case. The trial judge incorrectly applied this principle: [87]. Accordingly, the opinion of the appellant's surgeon did not have to expressly refer to the subsequent non-work related incidents in order for there to be a proper foundation for his assessment: [84]. The fact that the surgeon's reports did not refer to subsequent non-work related incidents did not amount to a failure to satisfy the requirements of expert evidence.

(ii) The trial judge wrongly concluded that there was a failure to comply with the second limb of Makita : [89]. The appellant's surgeon provided a scientific basis for his conclusion that the injury sustained in the work incident was responsible for the appellant's permanent incapacity.

(iii) The question whether there is a scientific or intellectual basis for an expert's opinion must be determined by reference to the entirety of the expert's evidence. A deficiency in one part of an expert's evidence may be made good by other material - either in another report or in oral evidence: [91].

(iv) The trial judge's reasoning in relation to the failure to comply with the principle in Makita was central to his rejection of the appellant's surgeon's evidence as having no weight. The parties should have had the opportunity to address the trial judge on this issue. The trial judge's failure to afford the parties this opportunity constituted a breach of procedural fairness: [95].

(v) It is not apparent that had the evidence of the appellant's surgeon been dealt with in accordance with correct legal principle and had the appellant been afforded procedural fairness, the result would have been the same: [102] - [104]. Therefore the matter should be remitted to the Workers Compensation Commission for redetermination in accordance with law.

(v) It is a matter for the primary decision maker as to whether or not to draw a Jones v Dunkel inference: [103]. Had the appellant made out a prima facie case, then the availability of this inference may have been particularly valuable.

Judgment

1 BEAZLEY JA: This is an appeal from a decision of Keating DCJ, President of the Workers Compensation Commission of NSW, in which his Honour, on an appeal from an Arbitrator pursuant to the Workplace Injury Management and Workers Compensation Act 1998, ss 352(1) and (5), revoked the decision of the Arbitrator awarding the appellant worker weekly compensation, and ordered that there be an award for the respondent employer.

2 The appellant has appealed to this Court pursuant to the Workplace Injury Management and Workers Compensation Act , s 353(1), on the basis that he is aggrieved by the decision of the Presidential Member in point of law.

The workers compensation proceedings

3 The appellant, who was employed by the respondent as a labourer stacking and sorting timber, alleged that on 31 October 2005, he injured his right knee when he slipped on a cleat whilst stacking timber in the course of his employment (the work incident). The appellant was off work for a few days after the incident but thereafter remained at work, save for various periods of sick leave, not claimed by him at the time as being due to the original injury, until 26 March 2008, when he went off work, remaining off work on sick leave. The respondent terminated the appellant's employment on 16 October 2008.

4 The appellant sought weekly compensation payments from the respondent under the Workers Compensation Act 1987, claiming that he was suffering from permanent incapacity as a result of the injury to his knee sustained on 31 October 2005. The respondent denied the claim, whereupon the appellant brought proceedings in the Workers Compensation Commission.

5 The matter first proceeded before an arbitrator in the Workers Compensation Commission based upon statements by the appellant and other " witnesses " and by the tender of the medical certificates, reports and other documents. The Arbitrator made an award of weekly compensation in favour of the appellant. The respondent appealed and the appeal was heard and determined by Keating DCJ. The matter also proceeded before his Honour 'on the papers'.

6 Both before the Arbitrator and on the appeal to the Commission, the respondent contended that as the appellant did not report the injury and no one witnessed the work incident, it should be inferred that no such incident occurred. Alternatively, the respondent submitted that the appellant's incapacity was not caused by the work incident, but was attributable to subsequent non-work related activities the appellant had undertaken, namely: assisting members of his family to unload bearers and joists from a truck at his home on 22 January 2008; assisting a colleague, Mr Hindmarsh, to move house in late March 2008, when he moved several pieces of heavy furniture; sanding the floor at his home, which involved being on his knees for two days in late April 2008; as well as falling a second time in late March or early April 2008 (the subsequent non-work related incidents).

7 Keating DCJ found that the work incident had occurred and that the appellant injured his right knee as a result. However, his Honour concluded, at [175], that the appellant had failed to discharge the onus of proving that his " incapacity commencing on 26 March 2008 [being the date on which the appellant went off work on sick leave] resulted from the injury sustained on 31 October 2005 ".

8 Integral to this conclusion was his Honour's rejection, at [54], of the evidence of Dr Summersell, the appellant's treating orthopaedic surgeon, as having no weight. This finding appears to have been based on two aspects of Dr Summersell's evidence. First, as Dr Summersell had " failed to explain or even consider the effect of the intervening events " identified above, his Honour held, at [154], that the facts on which Dr Summersell's opinion was based did not form a proper foundation for it: Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705 at [85].

9 Secondly, his Honour found that in two virtually identical reports of 6 May 2008, Dr Summersell's opinion that the 2005 work incident was the cause of the appellant's incapacity, was given without any explanation of the scientific or other intellectual basis for the conclusion reached. Accordingly, his Honour considered, at [155], that Dr Summersell's opinion failed to satisfy the second limb of Makita .

Issues on the appeal

10 Four principal issues arose on the appeal. The first and second issues related to his Honour's treatment of the evidence of Dr Summersell. As to the first issue, the appellant contended that in finding that " no weight could be placed " on Dr Summersell's opinion, Keating DCJ wrongly applied the principles governing expert evidence and, in particular, the principle examined by Heydon JA in Makita.

11 As to the second issue, the appellant contended that his Honour denied him procedural fairness in placing no weight on Dr Summersell's opinion when no ' Makita objection' had been taken by the respondent. As this had not been raised as an issue in the case the appellant had no opportunity of making submissions to his Honour in respect of the proper application of the Makita principle to Dr Summersell's reports.

12 With respect to the third issue, the appellant contended that the trial judge's error in placing no weight on Dr Summersell's opinion, was compounded by his refusal to draw a Jones v Dunkel inference in the appellant's favour in circumstances where the respondent had failed to tender the report of its own medico-legal expert, Dr Bodel, who had seen the appellant for the purposes of the proceedings: Jones v Dunkel (1959) 101 CLR 298; [1959] ALR 367.

13 As to the fourth issue, the appellant contended that his Honour misdirected himself in law on the issue of causation by failing to ask whether the injury sustained in the work incident rendered the appellant susceptible to the effect of further injury. This question necessarily raised the further and central question whether the subsequent non-work related incidents were caused by that susceptibility. If so, the appellant's continuing incapacity from 26 March 2008 fell within " injury " within the meaning of the Workplace Injury Management and Workers Compensation Act .

Background facts

14 The appellant's case was that on 31 October 2005, he was stacking timber when he turned and slipped on a piece of cleat (which is an off-cut piece of timber). He said that his leg slipped from under him and he landed on his backside. He believed he twisted his right knee when he fell and said he felt pain in the back and on either side of his right knee.

15 No one saw the appellant fall and he did not report it. The appellant said that, immediately after his fall, he tried to locate a supervisor but none could be found and he did not believe that there was a log book in existence at that time in which to record workplace injuries. However, on 10 May 2006, following a safety meeting conducted by the respondent, the appellant completed a questionnaire concerning, inter alia, previous work injuries in which he stated that he had injured his knee at work the previous year.

16 On the day of the work incident, the appellant spoke to a co-worker, Peter Hyde, and told him about the incident but that he was " ok ". The appellant continued to work for the remainder of the day, although his knee was sore. That afternoon the appellant's mother picked him up from work. She noticed he was limping. He did not attend work on 2 or 3 November 2005, but stayed at home and rested his knee.

17 The appellant's mother made an appointment for him to see a medical practitioner, Dr Gak, on 4 November 2005, which she also attended. During the examination and in his mother's presence, Dr Gak asked the appellant how he had come to be injured. When the appellant explained how he was injured, his mother recalled Dr Gak responding with words to the effect: " so it's covered by Workers' Compensation? " and the appellant replying that he " didn't think he was covered because he did not tell a supervisor at work only a mate ". The appellant said that he had not subsequently reported the injury because he was afraid for his job security.

18 The appellant alleged that, following the work incident, his knee progressively became worse. He attended the Grafton Base Hospital on several occasions in 2007 and 2008 and consulted a number of doctors during this time. On 23 June 2008, the appellant underwent a right knee arthroscopic partial medial meniscectomy and chondroplasty, which was carried out by Dr Summersell.

19 Mr Hyde, to whom the appellant said he mentioned the incident, stated that he recalled the appellant walking past him in the packing room and observed him to be rubbing his knee. He said that the appellant told him that he had " slipped on some timber on the floor but was ok ". Subsequently, he saw the appellant on occasions with a guard on his knee. Mr Hyde said that in the two and a half years prior to the hearing, the appellant had not mentioned his knee and had not " really shown any signs of an injury ". He also said that " I would see [the appellant] with a wrist or knee guard on occasionally but it never affected his work ".

20 Five other work colleagues gave statements. His Honour summarised their evidence as being to the effect that they were either unaware of any injury suffered by the appellant and/or that the appellant had never complained to them of an injury to his knee or of symptoms relating thereto.

Medical treatment and reports and subsequent incidents

21 It will be recalled that the work incident occurred on 31 October 2005. The appellant saw Dr Gak on 4 November 2005. Dr Gak's notes stated that the appellant " needed a clearance to go back to work as from monday 7.11.05 following R knee injury at work ". Dr Gak signed a certificate of sickness which recorded the appellant as suffering from right knee injury. Dr Gak declared the appellant fit to return to work on Monday, 7 November 2005, which he did.

22 From about late 2006, the appellant said that he needed to wear a knee guard or strapping at work. He wore it on and off depending on the level of his pain. As mentioned, this aspect of the appellant's statement was corroborated by Mr Hyde.

23 On 8 October 2007, because of increasing pain in his right knee which the appellant said " just came on after work ", the appellant attended Grafton Base Hospital. He gave a history to the Hospital of an injury " 2 years ago while working timber mills ". He stated that he had been walking a lot over the previous few days at work and that the " pain started with swelling ". He said he was unable to bear weight on his right knee.

24 A CT scan performed on 10 October 2007 demonstrated a " hypodense mass " lying on " the lateral aspect of the right knee ". A letter from the Hospital of the same date to Dr Barrell, the appellant's general practitioner, stated that having regard to these investigations, the diagnosis was highly likely to be a ganglion.

25 In early 2008, Dr Barrell referred the appellant to Dr Summersell.

26 The next relevant date is 22 January 2008. The appellant stated that whilst at work on that day, his leg pain got progressively worse. That afternoon at home, he assisted members of his family to unload timber from a truck. He said that whilst he was undertaking this activity, his knee continued to swell and ache as it had during the day. This was one of the activities upon which the respondent relied as having caused the appellant's disabilities. The appellant said that the following day, his knee was worse and he ceased work and attended Grafton Base Hospital because he was unable to see his own doctor. The appellant returned to the Hospital on 24 January 2008 to obtain a medical certificate for work purposes.

27 The Hospital notes relating to his attendance on 23 January referred to the ganglion cyst and stated that the appellant was waiting on an appointment with Dr Summersell. The notes recorded, " related to injury 2 yrs ago - aggravated it on Tuesday when twisted knee + pain in popliteal region - much better now ". On examination, he was observed to be walking with a limp. However, there was no tenderness over the right knee and the appellant had full range of movement of his knee.

28 In March 2008, the appellant assisted a work colleague, Mr Hindmarsh, to move some furniture. The appellant stated that he wore a knee guard whilst doing so and also said that the work was " probably less arduous " than the work that he performed in his employment with the respondent.

29 On 26 March 2008, the appellant had an ultrasound on his right knee. The ultrasound report recorded that there was " tenderness over the medial joint space ", with " a clear effusion " being noted. Dr Newman, who performed the ultrasound, reported that as the medial collateral ligament was intact, the possibility of cartilage injury or cruciate injury was more likely.

30 The appellant did not return to work after this.

31 On 9 April 2008, the appellant attended Centrelink as he was concerned that he may not be able to continue leave in his employment.

32 On 18 April 2008, an x-ray was performed which showed " joint effusion " and ossification " in the insertion of the suprapatellar tendon ".

33 On 21 April 2008, Mr Hancock again presented at Grafton Base Hospital. The Hospital notes recorded "swollen R lower leg, HX of seeing Dr Barrell 3/7 ago been taking NSAIDS today increasing pain swelling seems worse".

34 The history obtained on this occasion, as recorded by the triage nurse, was:

"... multiple problem [with] R knee/proximal leg for specialist RV in 2/52. Aggravated recently by two days 'sanding' @ home-on knees swelling medial upper leg. Has had XR and US 2/52 ago but past 48 hrsswelling of entire leg."

35 Under the heading " presentation history, " the clinical notes recorded state:

"... swollen R lower leg + R foot 1/52 C/O pain R lower leg radiating R knee. H X fall 3/52. S/B GP for same."

36 On 21 April 2008, the appellant also underwent a right leg venous doppler. No " venous thrombus " was present. Dr R Singh reported on the results as follows:

"Partly anechoic material is present along the medial aspect of the distal thigh and proximal calf. Overlying soft tissue swelling is also present. It is uncertain whether this represents intermuscular haematoma related to a muscular tear or a popliteal cyst rupture or an abscess. Further clinical assessment is required."

37 The appellant's first consultation with Dr Summersell was on 29 April 2008. In his report of that date to Dr Barrell, Dr Summersell recorded a history of the appellant injuring his knee while at work about three years previously, having about three days off work at that time and of the knee not being " right " since then. He noted that the appellant reported that he had been bothered by medial pain and a tightness around the back of the knee. The pain was of intermittent severity, with more days being bad than good. The appellant reported that the pain was usually worse later in the day. The knee had a painful click if he moved the wrong way and it felt unstable at times if he stepped the wrong way. The appellant reported that the knee could give way.

38 Dr Summersell did not make a diagnosis on that occasion, but said that he would see the appellant again after the appellant had had a new x-ray and an MRI scan. Dr Christie, who prepared the MRI report of 1 May 2008, concluded from the MRI findings:

"Medial compartment OA (osteoarthritic) change with osteochondral injury. Unusual soft tissue swelling superior and inferior to the knee joint on the medial side. The nature of this is uncertain."

39 On a follow-up visit on 6 May 2008, Dr Summersell, after reviewing the MRI scan, diagnosed a " medial meniscal tear and articular surface injury, soft tissue injury ". In a report of that date to Dr Barrell (the first report), Dr Summersell expressed the opinion that " the subcutaneous changes " were " due to a recent fall that [the appellant] had had due to the pre-existing instability of his knee ". Dr Summersell, in a report of that date (the first 6 May report) to Dr Barrell, stated that " [the appellant] feels that the injury he had about three years ago is responsible for the current condition of his knee ".

40 There is another report of Dr Summersell's, dated 6 May 2008, also addressed to Dr Barrell (the second 6 May report). This report is in identical terms to the first report save for two matters. In place of the sentence bolded above, the second report stated, " I think the injury that [the appellant] had about three years ago is responsible for the current condition of his knee ". The first 6 May report also stated: " If approval isn't given then the surgery will occur at the public hospital. " This comment was not contained in the second report. It is not apparent whether the second report was also sent to Dr Barrell.

41 Copies of Dr Summersell's 29 April 2008 report and his second 6 May report were faxed to the respondent's insurer on 20 May 2008.

42 On 30 May 2008, Dr Summersell provided a report to the respondent's insurer in response to a series of questions asked of him by the insurer. In this report, Dr Summersell reported the history given to him by the appellant in the same terms as that given in the report dated 29 April 2008 to Dr Barrell.

43 In response to the question asking his diagnosis, Dr Summersell stated:

"... medial meniscal tear and articular injury, soft tissue injury. [The appellant's] current condition is consistent with a previous knee injury and [the appellant] associates his current problems with an injury he recalls he had about 3 years ago." (emphasis added)

44 In response to the question "Do you consider that [the appellant] has suffered an aggravation", Dr Summersell responded:

"... when I initially saw him he was suffering an aggravation due to a recent fall that he feels occurred due to the instability that has been bothering him since an injury, he stated to me, occurred at work 3 years ago."

45 In response to the question whether the employment with the respondent was a substantial contributing factor to his injury, Dr Summersell stated:

"[The appellant] relates his current knee problems to any injury he believes he had at work about 3 years ago, I did not assess him at that time. If the initial injury did in fact occur at work 3 years ago then it would be a substantial contributing factor to his current knee problems ." (emphasis added)

46 On 23 June 2008, Dr Summersell performed a right knee arthroscopic partial medial meniscectomy and chondroplasty. He found a complex tear of the anterior horn of the medial meniscus, as well as a longitudinal injury in the medial femoral condyle weight bearing surface. Dr Summersell provided two operative reports to Dr Barrell which are not relevant to the issues on the appeal.

Reasons of Keating DCJ on the appeal from the Arbitrator's decision

47 The appellant's claim for weekly compensation benefits and for medical benefits was brought under the Workers Compensation Act . The entitlement to compensation is contained in s 9, which provides:

"(1) A worker who has received an injury (and, in the case of the death of the worker, his or her dependants) shall receive compensation from the worker's employer in accordance with this Act."

48 Section 9A provides:

"(1) No compensation is payable under this Act in respect of an injury unless the employment concerned was a substantial contributing factor to the injury."

49 Injury is defined in s 4 to include:

"(ii) the aggravation, acceleration, exacerbation or deterioration of any disease, where the employment was a contributing factor to the aggravation, acceleration, exacerbation or deterioration ..."

50 One of the issues identified by the Arbitrator was whether, if the appellant fell at work, injuring his knee on 31 October 2005, was that injury the cause of any past and continuing incapacity associated with the appellant's knee. It is apparent from the Arbitrator's reasons that the appellant's case was that the subsequent non-work related incidents were aggravations of the injury he sustained in the work incident.

51 On appeal from the Arbitrator, Keating DCJ identified this issue in his reasons, at [9](2), in the following terms: whether " the worker was incapacitated by reason of the alleged injury sustained on 31 October 2005 ". In determining that question, his Honour said at [138]:

"The [appellant's] evidence that he continued to suffer from problems with his right knee after the injury in October 2005 ... must be considered in the light of other evidence both corroborative and not corroborative."

52 His Honour reviewed the statements and the medical reports. At [149], after noting that apart from Mr Hyde, the statements of the appellant's work colleagues were to the effect that they did not know of the injury, nor did the appellant complain of an injury or ongoing symptoms, his Honour observed that three of the witnesses described themselves as friends of the appellant. His Honour considered that in the circumstances, their statements were " compelling evidence that any injury sustained by [the appellant in October 2005] was either of a trivial nature or was not incapacitating ".

53 His Honour, at [151], stated that the evidence of the appellant's mother must be treated with some circumspection. It is apparent from his Honour's reasons that his Honour rejected her evidence.

54 His Honour accepted, at [154], the appellant's evidence that he sustained an injury at work on 31 October 2005. However, his Honour considered, at [153], that the medical evidence must be treated with some circumspection, as neither party had adduced:

"... a forensic medical report with a complete history of the work and non-work related incidents from which a reliable conclusion could be formed as to the cause of Mr Hancock's knee problems."

55 His Honour stated that the medical certificates obtained from Dr Barrell and Dr Gak carried little or no weight in the absence of a detailed report setting out the appellant's history, any findings on examination and an opinion on causation.

56 His Honour next dealt with Dr Summersell's opinion. Given that the challenges on the appeal are essentially directed to his Honour's reasoning at [154]-[155], it is necessary to set out those paragraphs in full. His Honour stated:

"[154] Dr Summersell's opinion is unreliable for a number of reasons. His opinion is based on an acceptance of [the appellant's] account of his injury on 31 October 2005, which I accept. However, it is also based on his acceptance of continuing symptoms since then, which I do not accept. Furthermore he has failed to explain or even consider the effect of the intervening events occurring on or about 22 January 2008 (lifting bearers and joists), late March 2008, (moving furniture and appliances), a second fall in late March or early April 2008, and in late April 2008 (two days sanding on knees), indeed he offered no explanation for [the appellant] ceasing work in March 2008. Therefore, the facts on which the opinion is based do not form a proper foundation for it ( Makita (Australia) Pty Ltd v Sprowles [2001] NSWCA 305; (2001) 52 NSWLR 705 (' Makita ') per Heydon JA at [85]).

[155] Furthermore, Dr Summersell provided two reports dated 6 May 2008. In the first he offered no opinion as to causation other than to restate [the appellant's] own opinion that the problems with his knee were related to the incident in 2005. In the second, without offering any explanation, he stated that he, himself had formed the view that the 2005 incident was the cause of [the appellant's] incapacity. In the absence of an explanation of the scientific or other intellectual basis for the conclusion reached, Dr Summersell's opinion also fails to satisfy the second limb of Makita . See also Hevi Lift (PNG) Ltd v Etherington [2005] NSWCA 42 (' Hevi Lift '). For these reasons, I have concluded that no weight can be placed on Dr Summersell's opinion."

57 I deal with Makita in detail below. It is useful at this point to refer to Hevi Lift where McColl JA (Mason P and Beazley JA agreeing) said at [84]:

"... a court cannot be expected to, and should not, act upon an expert opinion the basis for which is not explained by the witness expressing it."

58 Keating DCJ noted, at [159], that Dr Summersell's 23 June 2008 operative findings included a complex tear of the medial meniscus. His Honour observed that this was not the pathology found in 2007 and that there had been no mention of a torn meniscus until Dr Summersell diagnosed it in 2008 after the subsequent non-work related incidents. His Honour observed, at [160], that there was no medical evidence to explain the difference between the 2007 pathology and that found in 2008. His Honour then stated that he was not satisfied that the injuries sustained by the appellant on 31 October 2005 caused any significant pathology.

59 At [161], his Honour noted that Dr Gak had not provided any diagnosis and that the exact nature of the injury sustained on 31 October 2005 was not known. He considered that as the appellant was only off work for a few days and had then returned to work and performed his normal duties for more than two years without restriction, he should accept the evidence of the appellant's work colleagues that the appellant had worked until 2008 without demonstrating any sign of injury or disability. His Honour found, therefore, that the appellant had recovered from the effects of the work incident within days of it occurring.

60 His Honour next dealt with the submission that he should draw a Jones v Dunkel inference against the respondent given that the respondent had failed to provide Dr Bodel's medico-legal report to the Commission. His Honour accepted that that it may well be inferred that the report was not provided to the Commission because it was unfavourable to the respondent's case. However, he considered that that was of little comfort to the appellant unless he had established his own case at least to a prima facie level. His Honour stated that for the reasons he had given the appellant had failed to do so.

61 His Honour, in the following paragraphs of his reasons, referred to the evidence relating to the subsequent non-work related incidents. His Honour then stated, at [171], that the difficulty in accepting the appellant's evidence of ongoing pain and instability was compounded by the overwhelming evidence of his friends and colleagues that he had gone for several years after the work incident with no apparent restrictions, problems or complaints regarding his knee. His Honour considered that the appellant's complaints of persistent problems with the knee since the work incident was inconsistent with his capacity to undertake the heavy physical work he did, both in the course of his employment and in performing the activities which resulted in the subsequent non-work related incidents.

62 His Honour therefore concluded, at [173], that:

"[t]he combination of the lay evidence from [the appellant's] colleagues, his own failure to address a series of intervening injuries, and the lack of any persuasive medical evidence"

led him to the conclusion that incapacity due to the effects of the work incident ceased by 7 November 2005 and that any claimed incapacity from 26 March 2008, was unrelated to that incident.

First issue on the appeal: error in the application of the Makita principle

63 The appellant made five complaints as to the manner in which his Honour applied the Makita principle to Dr Summersell's opinion at [154]-[155] of his reasons. First, he submitted that his Honour applied the wrong principle at [154] when he found that " the facts on which the opinion is based do not form a proper foundation for it " . In particular, the appellant contended that his Honour erred in that he considered it was necessary for the factual foundation of an expert report to be identical to the proven facts, whereas the correct principle required only that the facts as assumed be " sufficiently like the facts established by the evidence ". Second, the appellant submitted that, at [155], his Honour wrongly applied the principle in Makita to the opinion expressed.

64 The appellant also complained that his Honour was wrong in finding that Dr Summersell had failed to even consider the effect of the subsequent non-work related incidents. Dr Summersell's opinion was predicated upon the appellant having instability in his knee. Dr Summersell linked other falls that the appellant had had back to the work incident injury, on the assumption that such injury had occurred. Senior counsel for the appellant accepted that this was probably a factual error. However, I mention it at this point as it is relevant to the respondent's argument that even if there was error in point of law as alleged by the appellant, the outcome of the case would not have been different because his Honour did not accept that the appellant had sustained any ongoing disability as a result of the work incident.

65 In order to deal with these two complaints it is first necessary to understand the Makita principle and its proper application.

The Makita principle

66 In Makita, Heydon JA (as his Honour then was), set out, at [85], the requirements for expert evidence to be admissible. His Honour's remarks were made in the context of the Evidence Act 1995, s 79, which provides for the admissibility of expert evidence as an exception to the opinion evidence rule: see s 76. Section 79 provides, relevantly:

"(1) If a person has specialised knowledge based on the person's training, study or experience, the opinion rule does not apply to evidence of an opinion of that person that is wholly or substantially based on that knowledge."

67 After a lengthy review of the authorities, as well as considering the express terms of s 79, Heydon JA stated, at [85] 743-4:

"... if evidence tendered as expert opinion evidence is to be admissible, it must be agreed or demonstrated that there is a field of 'specialised knowledge'; there must be an identified aspect of that field in which the witness demonstrates that by reason of specified training, study or experience, the witness has become an expert; the opinion proffered must be 'wholly or substantially based on the witness's expert knowledge'; so far as the opinion is based on facts 'observed' by the expert, they must be identified and admissibly proved by the expert, and so far as the opinion is based on 'assumed' or 'accepted' facts, they must be identified and proved in some other way; it must be established that the facts on which the opinion is based form a proper foundation for it; and the opinion of an expert requires demonstration or examination of the scientific or other intellectual basis of the conclusions reached: that is, the expert's evidence must explain how the field of 'specialised knowledge' in which the witness is expert by reason of 'training, study or experience', and on which the opinion is 'wholly or substantially based', applies to the facts assumed or observed so as to produce the opinion propounded. If all these matters are not made explicit, it is not possible to be sure whether the opinion is based wholly or substantially on the expert's specialised knowledge. If the court cannot be sure of that, the evidence is strictly speaking not admissible, and, so far as it is admissible, of diminished weight. And an attempt to make the basis of the opinion explicit may reveal that it is not based on specialised expert knowledge, but, to use Gleeson CJ's characterisation of the evidence in HG v R [1999] HCA 2; (1999) 197 CLR 414 at 428 [41], on 'a combination of speculation, inference, personal and second-hand views as to the credibility of the complainant, and a process of reasoning which went well beyond the field of expertise'."

68 Heydon JA referred to the requirements for expert evidence to be admissible in less extensive terms, which are nonetheless relevant to this case, in Rhoden v Wingate [2002] NSWCA 165, at [61], as requiring that the expert gives evidence of what the expert personally observed, what the expert assumed, but did not personally observe, and, in the light of that material and the witness' expertise, what the witness' opinions were. This observation reflects the practical application of the principles governing expert evidence in circumstances where, for example, the witness' expertise is not in issue or where there is no issue that the opinion given is in an area of accepted expertise.

69 Similar practical approaches to the admissibility of expert evidence are to be found in the authorities. Thus, in Paino v Paino [2008] NSWCA 276; (2008) 40 Fam LR 96, Hodgson and McColl JJA noted, at [66], that it is inherent in the process of preparing many expert reports that the factual basis for the opinion expressed is derived from third party information. Their Honours pointed out that what the courts require is that the factual bases of opinions be clearly laid out so that the opinion of the expert may be properly tested. See also Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Limited [2002] FCAFC 157; (2002) 55 IPR 354; Adler & Anor v ASIC [2003] NSWCA 131; (2003) 46 ACSR 504.

70 In ASIC v Rich & Ors [2005] NSWCA 152; (2005) 218 ALR 764, an issue arose as to the basis upon which an expert could express an opinion. In that case, the respondent had submitted that the principles stated in Makita required that, for expert evidence to be admissible, it must be based on facts set out in the report and on no other facts, and that the opinion expressed be arrived at by the process of reasoning set out in the report and by no other process of reasoning. The alternative approach, advanced by the appellant, was that it was sufficient if the expert identified the facts and reasoning process which the expert asserted to be an adequate basis for the opinion expressed in the report.

71 The resolution of this issue involved Spigelman CJ (with whom Giles and Ipp JJA agreed) undertaking a detailed analysis of the underlying basis of Heydon JA's reasoning in Makita , by reference, in particular, to the reasoning of Gleeson CJ in HG v R [1999] HCA 2; (1999) 197 CLR 414 to which Heydon JA had made extensive reference. At [99], Spigelman CJ observed that the observations of Gleeson CJ did not represent the ratio of HG in a manner that was binding on the Court of Appeal. Nonetheless, his Honour proceeded on the basis that the reasoning of Gleeson CJ was correct and expressed his agreement with that reasoning in any event.

72 The analysis is lengthy. It is sufficient for the purposes of my reasons to refer only to the limited passages set out below. At [39], Gleeson CJ accepted that an expert's report may be based on assumed facts. His Honour said:

"An expert whose opinion is sought to be tendered should differentiate between the assumed facts upon which the opinion is based, and the opinion in question. Argument in this Court proceeded upon the basis that it was possible to identify from Mr McCombie's written report some facts which he either observed or accepted, and which could be distinguished from his expressions of expert opinion. Even so, the provisions of s 79 will often have the practical effect of emphasising the need for attention to requirements of form. By directing attention to whether an opinion is wholly or substantially based on specialised knowledge based on training, study or experience, the section requires that the opinion is presented in a form which makes it possible to answer that question." (footnotes omitted)

73 Of particular importance to the present case is the acceptance by Spigelman CJ of the following statement of Gleeson CJ in HG as to what is required for expert evidence to be admissible. Gleeson CJ stated, at [41], that such expert evidence:

"...required identification of the facts [the expert] was assuming to be true , so that they could be measured against the evidence; and ... demonstration or examination of the scientific basis of the conclusion." (Spigelman CJ's emphasis)

74 This is a principle of long standing. It was referred to by the High Court in Paric v John Holland (Constructions) Pty Ltd [1985] HCA 58; (1985) 62 ALR 85, at [9], where the Court (Mason CJ, Wilson, Brennan, Deane and Dawson JJ) said:

"It is trite law that for an expert medical opinion to be of any value the facts upon which it is based must be proved by admissible evidence: Ramsay v Watson [1961] HCA 65; (1961) 108 CLR 642. But that does not mean that the facts so proved must correspond with complete precision to the proposition on which the opinion is based. The passages from Wigmore on Evidence ... to the effect that it is a question of fact whether the case supposed is sufficiently like the one under consideration to render the opinion of the expert of any value are in accordance with both principle and common sense." (emphasis added)

75 Gleeson CJ referred to Ramsay v Watson in his reasons in HG , and in Makita Heydon JA also expressly adopted the reasoning in Ramsay v Watson . As Heydon JA said, at [66], that case was a classic illustration of the principle that the " assumed facts " need not be itemised by the expert witness in an artificial way. His Honour referred to the High Court's observation in Ramsay v Watson that:

"... it was permissible for a doctor to narrate the history obtained from a patient as part of the foundation of the doctor's opinion on the patient's health, even though the narration was not admissible to prove the facts of the history unless some exception to the hearsay rule were satisfied."

76 Notwithstanding that an expert may give an opinion on assumed facts, the High Court in Ramsay v Watson observed, at 649, that if the history obtained by the doctor and upon which the doctor based her or his expert opinion is not supported by admissible evidence, the opinion " may have little or no value, for part of the basis of it is gone ".

77 Spigelman CJ's analysis in ASIC v Rich of Heydon JA's reasoning in Makita concluded that it conforms with the statement of Gleeson CJ in HG , at [39], set out at [72] above. As Spigelman CJ stated, at [105]:

"Although expressed in terms of 'usefulness', the starting point for Heydon JA's detailed analysis of the case law on admissibility does not suggest any focus on the true historical process by which the expert first formed the relevant opinion. The focus of attention - the 'prime duty' - is to ensure that the court, as the tribunal of fact, is placed in a position where it can examine and assess the evidence presented to it. That can occur without adopting the true factual basis approach . What Heydon JA identified as the expert's 'prime duty' is fully satisfied if the expert identifies the facts and reasoning process which he or she asserts justify the opinion. That is sufficient to enable the tribunal of fact to evaluate the opinions expressed ." (emphasis added)

78 I accept this analysis, which I consider to be clearly correct.

Application of Makita to the proceedings in the WCC

79 As I indicated above, it is important to keep in mind that in Makita , Heydon JA was concerned with the admissibility of evidence under the Evidence Act , s 79. The Workers Compensation Commission is not bound by the rules of evidence. Rather, the Workplace Injury Management and Workers Compensation Act , s 354 provides:

" 354 Procedure before Commission

(1) Proceedings in any matter before the Commission are to be conducted with as little formality and technicality as the proper consideration of the matter permits.

(2) The Commission is not bound by the rules of evidence but may inform itself on any matter in such manner as the Commission thinks appropriate and as the proper consideration of the matter before the Commission permits.

(3) The Commission is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms."

80 The Workers Compensation Rules 2006, r 15.2 provides:

" 15.2 Principles of procedure

When informing itself on any matter, the Commission is to bear in mind the following principles:

(a) evidence should be logical and probative,

(b) evidence should be relevant to the facts in issue and the issues in dispute,

(c) evidence based on speculation or unsubstantiated assumptions is unacceptable,

(d) unqualified opinions are unacceptable."

81 In South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16; (2007) 4 DDCR 421, McColl JA (Giles and Tobias JJA agreeing) observed, at [127]:

"While the Commission may inform itself on any matter in such manner as it thinks appropriate and as the proper consideration of the matter before it permits (s 354(2)), r 70 of the Workers Compensation Commission Rules 2003 [the Workers Compensation Commission Rules 2006, r 15.2] provides that when informing itself on any matter, the Commission is to bear in mind the principles that evidence should be logical and probative, should be relevant to the fact in issue and the issues in dispute, that evidence 'based on speculation or unsubstantiated assumption is unacceptable' and that 'unqualified opinions are unacceptable'."

(The Workers Compensation Commission Rules 2006, r 15.2 superseded, but replicated in identical form, the Workers Compensation Commission Rules 2003, r 70.)

82 Although not bound by the rules of evidence, there can be no doubt that the Commission is required to be satisfied that expert evidence provides a satisfactory basis upon which the Commission can make its findings. For that reason, an expert's report will need to conform, in a sufficiently satisfactory way, with the usual requirements for expert evidence. As the authorities make plain, even in evidence-based jurisdictions, that does not require strict compliance with each and every feature referred to by Heydon JA in Makita to be set out in each and every report . In many cases, certain aspects to which his Honour referred will not be in dispute. A report ought not be rejected for that reason alone.

83 In the case of a non-evidence-based jurisdiction such as here, the question of the acceptability of expert evidence will not be one of admissibility but of weight. This was made apparent in Brambles Industries Limited v Bell [2010] NSWCA 162 at [19] per Hodgson JA. That is the way that Keating DCJ dealt with Dr Summersell's evidence in this case, so that is not the relevant error.

84 It is necessary at this point to return to his Honour's reasons at [154]. It is convenient to set out the relevant part of that passage again. His Honour said:

"[Dr Summersell's opinion] is also based on his acceptance of continuing symptoms since [the 2005 work incident], which I do not accept. Furthermore he has failed to explain or even consider the effect of the intervening events occurring on or about 22 January 2008 (lifting bearers and joists), late March 2008, (moving furniture and appliances), a second fall in late March or early April 2008, and in late April 2008 (two days sanding on knees), indeed he offered no explanation for [the appellant] ceasing work in March 2008. Therefore, the facts on which the opinion is based do not form a proper foundation for it. " (emphasis added)

85 With respect to his Honour, this reasoning is the same reasoning as that rejected by this Court in ASIC v Rich. Dr Summersell's opinion did not have to expressly refer to the subsequent non-work related incidents in order for there to be a proper foundation for the opinion expressed in his reports. Rather, what was required for satisfactory compliance with the principles governing expert evidence was for his reports to set out the facts observed, the assumed facts including those garnered from other sources such as the history provided by the appellant, and information from x-rays and other tests.

86 Those requirements were all satisfied. In this case, as the appellant pointed out, neither Dr Summersell's field of specialised knowledge, nor his status as an expert, was challenged. Insofar as his opinion was based upon facts " observed " by him, those facts were contained within his examination findings in his report of 29 April 2008 to Dr Barrell and the report of the MRI scan.

87 Insofar as Dr Summersell's opinion was based on assumed facts, those matters were set out in his various reports. In particular, there was a reference in his report of 30 May 2008 to the appellant's knee not being " right " since the incident at work, to it feeling " unstable " and to the knee giving way. In his report of 6 May 2008, Dr Summersell expressed an opinion that a recent fall the appellant had experienced was due to the instability of his knee.

88 The fact that the reports did not refer to the subsequent non-work related incidents did not amount to a failure to satisfy the requirements of expert evidence. As explained above, the principle in Makita do not require that there be an exact correspondence between the assumed facts upon which an expert opinion is based and the facts proved in the case. Accordingly, the absence of any express reference to those specific incidents did not mean that the facts upon which Dr Summersell based his opinion, including falls and instability of the knee, did not form a proper foundation for his assessment as required by the principle in Makita. The extent of correspondence between the assumed facts and the facts proved was relevant to the assessment of the weight to be given to the reports. Although his Honour dealt with Dr Summersell's reports as a matter of weight, he incorrectly applied the principle in Makita as that principle was explained in ASIC v Rich. That constitutes error in point of law.

89 The next alleged error relates to his Honour's reasoning at [155]. Again, it is convenient to set out the relevant portion of his reasons:

"... Furthermore, Dr Summersell provided two reports dated 6 May 2008. In the first he offered no opinion as to causation other than to restate [the appellant's] own opinion that the problems with his knee were related to the incident in 2005. In the second, without offering any explanation, he stated that he, himself had formed the view that the 2005 incident was the cause of [the appellant's] incapacity. In the absence of an explanation of the scientific or other intellectual basis for the conclusion reached, Dr Summersell's opinion also fails to satisfy the second limb of Makita ."

90 With respect to his Honour, this passage does not fully replicate Dr Summersell's opinion in these two reports. In each, Dr Summersell stated that, in his opinion, he suspected that " the subcutaneous changes are present due to a recent fall that [the appellant] had due to the pre-existing instability of his knee ". This opinion provided the scientific basis for the conclusion he reached in the respective reports, that the injury sustained in the work incident was responsible for the current condition of the appellant's knee. Accordingly, there was no failure to comply with the second limb of Makita. His Honour's finding to the contrary thus constituted a wrong application of legal principle and also amounted to an error in point of law.

91 There is another problem with his Honour's approach at [155]. His Honour singled out the reports of 6 May 2008 and found a deficiency in those reports. It was that deficiency that led him to conclude, in conjunction with the supposed non-compliance with the principle in Makita, that Dr Summersell's evidence should be accorded no weight; that is, that his reports had no rational probative value: see Brambles Industries Limited v Bell at [16]. Whether an insupportable finding that an opinion has no rational probative value amounts to an error of law is not something upon which I need to express an opinion. The present point is different.

92 Although I have concluded that the two reports of 6 May 2008 were not deficient as found by his Honour, the question as to whether Dr Summersell's satisfied the principle discussed above had to be determined by having regard to all of his reports. A deficiency in one part of an expert's evidence may be made good by other material, either in another report or in oral evidence: see the discussion in Rhoden v Wingate at [55]-[73]. In total, there were four reports of Dr Summersell, including the two reports dated 6 May 2008. A failure to consider all of the material relevant to a particular issue is an error in the process of fact finding and itself amounts to an error of law: see Waterways Authority v Fitzgibbon [2005] HCA 57; (2005) 221 ALR 402 per Hayne J at [130]. The question as to whether there was a scientific or intellectual basis for Dr Summersell's opinion had to be determined by reference to all of his reports. It was not a determination that could be made by singling out an isolated part from the whole of that witness's material before the Commission.

93 There is also a question as to whether the principles governing the admissibility of expert evidence, and, in the case of jurisdictions where the rules of evidence do not apply, the weight to be given to expert evidence, had any role to play in the case of reports of an expert, such as a medical practitioner, which come into existence as business records. In Rich & Anor v ASIC [2005] NSWCA 233; (2005) 54 ACSR 365, Handley JA (Giles and Basten JJA agreeing) stated, at [13], that it was " far from clear " that the principle in Makita applied with their full force, or at all, to out of court statements by experts in business records. Although his Honour's observation was made in the context of an evidence-based jurisdiction, there is nonetheless force in his observation. However, I do not find it necessary to resolve that question in these reasons and I defer any further consideration of it to an occasion where the point is raised and directly in issue.

94 I have indicated above that the respondent's principal response to the appellant's arguments on the first issue is that, even if his Honour did err in the manner alleged, the error would make no difference because of his Honour's rejection of the appellant's case that he had ongoing symptoms. It is convenient to deal with that argument after I deal with the second issue, namely, that his Honour's according of no weight to the expert opinion of Dr Summersell constituted a denial of procedural fairness.

Second issue on the appeal: the natural justice issue

95 The appellant further contended that he was denied procedural fairness in that, neither before the Arbitrator nor before his Honour, was any issue raised that the opinion of Dr Summersell should be rejected as having no weight on the basis of a failure to comply with any aspect of the principle stated in Makita. The respondent's initial response to this submission was that there had been a challenge to Dr Summersell's evidence before the Arbitrator. It was submitted that that challenge was apparent from the Arbitrator's reasons, at [36], where there is a reference to Dr Summersell's evidence. However, a reading of that paragraph does not support the respondent's submission. Apart from [36] of the Arbitrator's reasons, the respondent accepted that there was no reference anywhere in the written submissions, either in those made to the Arbitrator, or more particularly in the written submissions made to his Honour, which raised the Makita points upon which his Honour relied.

96 His Honour's reasoning in relation to the failure to comply with aspects of the principle in Makita was central to his rejection of Dr Summersell's opinion as having no weight. Had either of the Makita points been raised by the respondent, the appellant would have had an opportunity to respond. Although it was open to his Honour to assess Dr Summersell's opinion having regard to the principle in Makita , this was such a critical matter in his Honour's determination that I am of the opinion that he should have given the parties the opportunity to address him before reaching a final conclusion. For that reason, I am of the opinion that there was a relevant failure to afford procedural fairness.

Should the matter be remitted to the Workers Compensation Commission?

97 However, that does not conclude the question as to whether his Honour's decision ought to be set aside. In Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141 the High Court noted that an appellate court will not order a new trial if it would inevitably result in the making of the same order as that made by the primary judge. For this reason, not every departure from the rules of natural justice will entitle the aggrieved party to a new trial. This principle is of long standing and has recently been affirmed by the High Court in Re Refugee Tribunal & Anor; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82 and SZBYR v Minister for Immigration and Citizenship [2007] HCA 26; (2007) 235 ALR 609.

98 The respondent contended that there was no basis for setting aside his Honour's decision because he had rejected the appellant's case that he suffered any ongoing disability beyond a few days after the initial 2005 work incident. The respondent submitted that, in that circumstance, Dr Summersell's opinion, which was based upon an acceptance by Dr Summersell of the appellant's history that he had had ongoing symptoms relating to his knee since the work incident, would not, in any event, have been accorded any weight by his Honour, regardless of any error involved in the application of the principle in Makita.

99 The difficulty with the respondent's proposition is in the manner in which his Honour eventually rejected the appellant's case. I have already set out his Honour's reasoning process in some detail. The paragraphs of his Honour's reasoning relevant to this argument are at [149] where he found the evidence of the appellant's co-workers compelling as to the trivial or non-incapacitating nature of the appellant's injury; at [154]-[155] relating to Dr Summersell's evidence; at [171] where his Honour refers to the difficulty in accepting the appellant's evidence being compounded by the overwhelming evidence of his friends; and then, finally his conclusion at [173], in which he finds that it is the combination of the evidence of the appellant's friends; the appellant's own failure to address the intervening injuries and the lack of any persuasive medical evidence which led him to conclude that the effect of the injury ceased a few days after the work incident.

100 There is no doubt that in the course of this reasoning his Honour was leading to a rejection of the appellant's claim that he had had ongoing symptoms since the work incident. However, he did not ultimately reject the appellant's case until he stated his conclusion at [173]. One of the reasons for that rejection was because his Honour considered that there was no persuasive medical support for the appellant's case. However, one of the reasons why the appellant's case did not have any persuasive medical support was because his Honour had rejected Dr Summersell's opinion. His Honour rejected Dr Summersell's opinion because he had not accepted the appellant's case. With respect to his Honour, this reasoning was circular.

101 It is not apparent to me that had Dr Summersell's evidence been dealt with in accordance with correct legal principle and had the appellant been afforded procedural fairness in respect of his Honour's dealing with Dr Summersell's evidence, that the result would have been the same. Had his Honour been directed to the correct application of the principles which govern expert evidence, it may have been that weight would have been afforded to Dr Summersell's opinion. The weight to be given to that opinion would then be a matter for the trial judge.

102 It is also possible that the appellant's submission relating to the failure of the respondent to cross-examine Dr Summersell may have been of more force had the appellant been aware that his Honour was going to reach his conclusion in respect of the medical evidence on 'the Makita principle'.

103 Importantly, it is likely that, had the appellant had the opportunity to address his Honour in respect of Dr Summersell's evidence and the correct application of the principles governing expert evidence, attention would have been drawn to the fact that Dr Summersell was aware that the appellant had subsequent injuries not directly related to the work injury, but which resulted from the instability that Dr Summersell attributed to the injury sustained in the work incident. Having regard to these various possibilities, I am not satisfied that the result in this case would have been the same.

104 My conclusion in respect of the first and second grounds of appeal makes it unnecessary to consider the further issues raised by the appellant. However, I would make the following comment in respect of the third issue, namely, that his Honour erred in failing to draw a Jones v Dunkel inference having regard to the failure of the respondent to provide to the Commission the report of Dr Bodel. This ground of appeal could not succeed on its own. It is a matter for the primary decision maker as to whether or not to draw a Jones v Dunkel inference. It is sufficient at this stage to say that, had the appellant made out a prima facie case, which was possible if any of the evidence of Dr Summersell had been accepted, then the availability of a Jones v Dunkel inference may have been particularly valuable to him.

Other matters

105 There is another matter which I feel compelled to raise in these reasons. In his reasons, his Honour recorded, at [124], the following two submissions made by the respondent:

"(r) the reports from the treating specialist Dr Summersell contain no history of a 'fall' or a 'second fall' or 'two days sanding on knees' even though [the appellant] first presented to Dr Summersell only seven days after presenting at the Grafton Base Hospital, reporting multiple problems in the right knee aggravated by two days sanding at home. It is submitted that these histories were deliberately withheld and explain Dr Summersell's confusion and inability to reach a diagnosis ;

(s) on 6 May 2008 Dr Summersell wrote two reports to Dr Barrell. In the first report, Dr Summersell in dealing with the question of causation said '[the appellant] feels that the injury he had about three years ago is responsible for the current condition of his knee'. In the further report, presumably written later, he expressed the opinion 'I think the injury [the appellant] had about three years ago is responsible for the current condition of his knee.' It is submitted that Dr Summersell's opinion has been influenced by the possibility of private hospital cover for the operative procedure recommended ..." (emphasis added)

106 With respect to the drafter of these submissions, they are improper. The submissions were made on an occasion of privilege and in circumstances where the drafter would have expected that neither the appellant nor Dr Summersell were likely to be called to give evidence, as turned out to be the case. It followed that neither the appellant nor Dr Summersell had the opportunity to defend themselves against the serious allegations of impropriety and dishonesty that were directed to their conduct. Courts and tribunals do not provide a forum for the making of serious allegations of impropriety and fraud, other than in well-accepted circumstances.

107 The principles which govern the making of such allegations were breached on this occasion. Before any such submission was made, the allegations of such seriously wrongful conduct should first have been put to the relevant persons, namely, the appellant and Dr Summersell. This could have been done by seeking an oral hearing. In seeking such a hearing, it would be incumbent upon the respondent to make it explicit that such allegations were being made so that the Court understood the case fell outside the usual practice in the Commission not to have an oral hearing. The respondent did not make any such application. The consequence is that the allegations are permanently part of the public record.

108 I raise the matter so that the Profession is in no doubt as to their professional responsibilities in the making of submissions.

109 I should also state that the drafter of the submissions was given the opportunity at the conclusion of the hearing of the appeal to explain why such submissions were made by him given that they were not supported in the evidence before the Commission. The drafter refrained from doing so without first obtaining legal advice. This was a position the drafter was entitled to take. However, that is a separate matter from that which I wish to bring to the attention of the profession.

110 I would propose the following orders:

1. Appeal allowed.

2. Remit the matter to the Workers Compensation Commission for redetermination in accordance with law.

3. The respondent to pay the appellant's costs of the appeal.

111 GILES JA: I agree with Beazley JA, and with the additional remarks of Tobias JA.

112 TOBIAS JA: I agree with the orders proposed by Beazley JA for the reasons she has given. In particular, I endorse her Honour's remarks at [104] to [106] of those reasons. It is in the context of the matters raised in those paragraphs that I wish to add some remarks of my own.

113 As her Honour notes at [5] of her reasons, the appellant's application proceeded both before the Arbitrator and the President of the Commission " on the papers ". Section 354 of the Workplace Injury, Management & Workers Compensation Act 1998 (the WIM Act) sets out the procedure to be followed before the Commission. Subsections (1) to (3) are reproduced by Beazley JA at [78] of her Honour's reasons. To those provisions I would s 354(6) which provides as follows:

"If the Commissioner is satisfied that sufficient information has been supplied to in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing."

114 Rule 15.2 of the Workers Compensation Rules is applicable to the operation of s 354(6) and is reproduced by her Honour at [79] of her reasons. Relevant to what I am about to say is that the rule provides that when informing itself of any matter, the Commission is to bear in mind a number of principles including, relevantly, that evidence should be logical and probative. I would have thought that that principle extends to the evidence being complete in that it does not contain unnecessary gaps or leave matters which require explanation unexplained.

115 Practice Direction No.1 was issued by the Commission with respect to the practice and procedure to be adopted when determining matters on the basis of documents provided ("on the papers") in the absence of any conference or formal hearing. It notes that the direction must be considered in the context of the objectives of the Commission including in particular the duty to provide a just, timely and effective dispute resolution in relation to workers entitlements under the legislation.

116 The Practice Direction then states that there will be many disputes suitable for determination on the papers and provides a number of examples where such a determination would be appropriate in the circumstances. It is noteworthy that those examples do not include those cases where there are factual disputes and, in particular, where the credit of the applicant or a witness is in issue. Thus, under the heading "Factors relevant to a determination on the papers", the Practice Direction states that without restricting the matters that may be relevant to the decision to determine a matter on the papers, the following factors will be considered of which, relevantly for present purposes, is whether there are questions as to the credit of the applicant or a witness. As I indicate below, the present matter was such a case.

117 The Practice Direction also provides for the procedure for determination of appeals on the papers. It states:

"The Presidential member to whom the appeal is allocated for determination will decide whether the matter is suitable for determination on the papers. All relevant documents and comprehensive written submissions must be put before the Presidential member by both parties, in order that the Presidential member may make that decision.

It is the responsibility of the parties to ensure that the Presidential member is properly and comprehensively informed in writing as to the grounds of and issues on appeal, and that any objections to a determination on the papers are clearly stated and supported by specific reasons, as opposed to broad generalities."

118 It may be noted that the responsibility of the parties to which reference is made does not extend, at least expressly, to the parties ensuring that the evidentiary material placed before the Presidential member is comprehensive in the sense that any gaps in the evidence are filled and any inconsistencies in the evidence are explained. However, in my opinion the parties and their legal representatives have that responsibility, one that in my respectful opinion was in some respects unfulfilled in the present case.

119 The President was aware of the requirements of s 354(6) of the WIM Act which he reproduced at [10] of his reasons. At [11] he said, relevantly:

"Having regard to Practice [Direction No.1], the documents that are before me, in the submissions by the parties that the appeal can proceed to be determined on these documents, I am satisfied that I have sufficient information to proceed 'on the papers', without holding any conference or formal hearing, and that this is the appropriate course in the circumstances."

120 I would observe that notwithstanding that the parties may have submitted that the appeal could proceed to be determined on the basis of the documents before the President (which comprised the material that was before the Arbitrator) subject only to the admission of some fresh evidence not presently relevant, in my view the President may still have been required to satisfy himself not only at the time he commenced consideration of the appeal but also at all times during the course of that consideration, that, given the issues which arose during the course of that consideration, he had sufficient information to enable him to proceed to a final determination on the papers without the necessity of holding any form of hearing.

121 In Fletcher International Exports Pty Ltd v Lott [2010] NSWC 63 at [44], Giles JA, with whose reasons McColl and Basten JJA agreed (the latter adding some reasons of his own), recorded a submission by the appellant in that case that the Acting President of the Commission had erred in law in that

"... the information before him was not capable (it was also said, not reasonably capable) of satisfying him that he could decide the appeal upon proper consideration. It was said that there was a 'continuing duty' to give proper consideration, so that even if he at first was satisfied that he had sufficient information to proceed on the papers, the Acting President should have taken a different course upon it becoming apparent that an oral hearing was necessary."

122 However, his Honour did not find it necessary to accept or reject that submission. It was not repeated before us so that it would not be appropriate to form a concluded opinion upon its validity. Nevertheless, even if there is no "continuing duty" breach that would involve an error of law, there is nothing to prevent the Presidential member from applying the required state of satisfaction at any time during his or her consideration of the matter the subject of the appeal. As a matter of practice, if not as a matter of law, I would have thought that the objectives of the Commission to provide a just and effective resolution of the dispute between the parties would be more likely to be achieved even if some delay in the determination of the matter resulted by requiring some, even truncated or limited, oral hearing where necessary to resolve serious credit issues.

123 Having set out the relevant procedural provisions, I now turn to what I perceive to be the issues that arose before the President and which have caused me some disquiet. Dealing first with the subject matter of [104] of Beazley JA's reasons, the President dealt with Dr Summersell's reports at [154] and [155] of his reasons which her Honour has extracted at [56] of her reasons. It is apparent that his Honour rejected Dr Summersell's opinions due to his failure to deal with the non-work related incidents (at [154]) and to offer an explanation for the differences in his two reports of 6 May 2008 (at [155]).

124 Although the President called Makita in aid of his conclusion that no weight should be accorded to Dr Summersell's opinions, it is apparent that the President considered that those reports were, on their face and in the respects relied upon by him, insufficient in the information they provided. His Honour was alive to these alleged deficiencies as appears from [153] of his reasons extracted at [54] of Beazley JA's reasons,

125 Of itself, in my respectful opinion, this should have conveyed to his Honour a concern as to whether s 354(6) of the WIM Act was satisfied at the point where he was forming his findings with respect to that material. It is apparent that the President did not have sufficient information upon which he could properly consider Dr Summersell's reports of 6 May 2006 without further explanation from him as to the differences between them. Given the submissions of the respondent highlighted by Beazley JA at [104] of her reasons, and accepting that the President did not, at least expressly, adopt those submissions, nevertheless, and particularly in the light of there being no medical evidence tendered on behalf of the respondent, fairness and justice required that Dr Summersell be given the opportunity of explaining the differences which ultimately caused the President to reject his opinion.

126 I turn now to the findings of the President referred to by Beazley JA at [52] of her reasons and, in particular, to his Honour's finding at [171] referred to by Beazley JA at [61] above and which for convenience I repeat:

"The difficulty in accepting Mr Hancock's evidence of ongoing pain and instability in the knee since November 2005 is compounded by the overwhelming evidence of his friends and colleagues to the effect that he went for several years after his injury in March 2005 with no apparent restrictions, problems or complaints regarding his knee. His evidence of persistent problems with the knee is also inconsistent with his capacity to undertake heavy physical work in the timber mill for several years after the injury and to participate in heavy physical activities outside of the workplace including unloading timber and joists at home, lifting heavy furniture and appliances while assisting a friend to move house and undertaking work around his home, for example, sanding whilst on his knees."

127 The President's finding that the effects of the injuries sustained by the appellant on 31 October 2005 had ceased by November 2005 was as a consequence of

"[t]he combination of the lay evidence of Mr Hancock's colleagues, his own failure to address a series of intervening injuries, and a lack of any persuasive medical evidence."

128 It is apparent not only from the President's conclusions but also from his consideration of the lay evidence tendered by both the appellant and respondent, that he regarded the former as an unreliable witness: see, for instance, [167] of his reasons. In particular, he considered that his evidence was inconsistent with that of his friends and work colleagues who provided statements of which the majority were those of the respondent's employees and tendered by it: see at [168]-[169].

129 There is no doubt that there were apparent inconsistencies between the evidence of the appellant on the one hand and those other witnesses on the other. The President preferred the evidence of the respondent's witnesses particularly because they were work colleagues of the appellant and some had become his friends and had not seen any signs of any ongoing problems with the appellant's knee. At least he had not complained about it.

130 It is also clear from the President's reasons at [160]-[173] that he regarded the appellant as lacking credit. There can be no doubt that in the mind of the President the evidence of the lay witnesses raised questions with respect to the appellant's credit. Yet it is apparent that his Honour still regarded it as appropriate to determine the issue of credit " on the papers ".

131 As I have indicated, Practice Direction No.1 makes clear that where an issue arises as to the credit of an applicant or a witness, that is a factor to be taken into account when considering whether to determine a matter " on the papers ". Whether or not the President took that factor into account in determining the matter on the papers is not apparent from his reasons.

132 The assertion by the President at [119] of his reasons, to which I have referred at [119] above, causes me some unease given that it must have been obvious at an early point of his consideration of the statements of the various witnesses that there was an issue with respect to the appellant's credit. One might be forgiven for thinking that before an adverse finding as to his credit was made, the appellant should have been given the opportunity of answering or explaining the evidence of his work colleagues relied upon by the President that he had not between 2005 and 2008 made complaints regarding his knee.

133 Furthermore, it is not self evident that the appellant was not still suffering the effects of the work-related incident in the years referred to simply because he did not complain about his knee to the witnesses upon whose evidence the President relied and who were employees of the respondent whose statements were tendered by it. There may have been a number of explanations for the lack of any complaint. Thus the appellant may simply not have been a complainer. He may well have not wished to complain about his knee to his work colleagues in case it got back to his employer and affected his job security. Thus, one of the statements tendered on behalf of the respondent was from the owner (and later manager) of the respondent's business who stated that at no time in the two and a half years prior to the date of his statement (28 May 2008), had the appellant made any mention of a work-related injury to his knee or reported any such injury. Again, the appellant may have simply preferred to work in a manner that did not reveal any weakness on his part in his ability to carry out his work to other employees of the respondent. He may have preferred to work with undisclosed pain rather than seek compensation.

134 These are all considerations which, in my respectful view, should have exercised the mind of the President either before or during his consideration of the matter so that he could be satisfied immediately prior to making his final determination that he in fact had sufficient information on which to make serious findings with respect to the appellant's credit.

135 I have referred at [117] above to the statement in Practice Direction No.1 as to the responsibility of the parties in ensuring that comprehensive information is provided to the Presidential member. As I there observed, failure of the parties to attend to their responsibilities does not, in my respectful view, relieve the Presidential member of his or her obligation to be satisfied that he or she has sufficient information to enable a determination to be made without holding any conference or formal hearing. That was a continuing obligation and could not be avoided simply because the parties had agreed that the appeal could be determined on the papers.

136 The present is a case where the appellant was unsuccessful before the Commission because of unfulfilled gaps and unexplained inconsistencies in both in the appellant's evidence and that of Dr Summersell's. The appellant's legal representatives should have been alive to those gaps and inconsistencies and should have ensured that as far as practicable the gaps were filled and the inconsistencies explained by seeking to file supplementary statements and/or reports. This should have occurred when the matter was before the Arbitrator. This is because an appeal under s 352 of the WIM Act is by way of review of the decision appealed against rather than a re-hearing: see s 352(5). Nevertheless, pursuant to s 352(6) fresh or additional evidence may be given on an appeal to the Commission with leave.

137 Alternatively, a submission could have been made on behalf of the appellant to the President that if the credit of the appellant was to be in issue, then fairness dictated that there should be some form of hearing and that the matter should not be determined solely upon the papers.

138 This is not the first time that I have commented upon the failure of legal representatives in cases such as the present to ensure that the evidentiary statements and reports which are to be tendered and relied upon are comprehensive, complete and as consistent as is practicable. I adverted to this issue in Brambles Industries Ltd v Bell [2010] NSWCA 162 at [24]-[27] with which McColl JA agreed.

139 Obviously, we have not heard from the appellant's legal representatives and, therefore, it would not be appropriate to make any final criticism of the manner in which they conducted this matter. I am content to simply observe that a careful consideration of the material that was before the Arbitrator and which was to be before the President revealed matters (such as the appellant's lack of complaints to his work colleagues) which, at least prima facie, would seem to have called for some explanation from him in order to avoid any adverse credit finding.

140 Be this as it may, the President should have been alive to the matters to which I have referred given that it was clear, at least to him, that a significant issue in the appeal involved the appellant's creditworthiness. Equally, again as the President recognised, the aspects of the two reports of Dr Summersell of 6 May 2008 upon which he (the President) relied and which ultimately caused him to give no weight to that expert's opinion, involved an implicit finding which, at least in part, reflected adversely on Dr Summersell's credibility and integrity. As a matter of fairness these problematic aspects of the reports called out for an explanation particularly in the light of the fact that no medical evidence was tendered on behalf of the respondent. Dr Summersell was not, apparently, given the opportunity to provide that explanation.

141 I simply conclude these remarks by observing that the conduct of the appeal on the papers has left me with a significant feeling of unease. Both the Commission and the legal profession should, as Practice Direction No.1 makes clear, give serious consideration as to whether it is appropriate for a matter to be determined wholly on the papers where questions as to the credit of the applicant or a witness are in issue as in the present case.

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Amendments

02 February 2012 - corrected paragraph references
Amended paragraphs: 132 and 135

Decision last updated: 02 February 2012