Section 59 A – No limit to compensation?

Case Law Update

Pacific National v Baldacchino [2018] NSWWCCPD 12 (28 March 2018)

Generally speaking, section 59A of the Workers Compensation Act 1987 terminates employer liability to pay costs for treatment after the expiry of the relevant period.

However, we have considered the authority of Pacific National v Baldacchino [2018] NSWWCCPD 12 (28 March 2018) and its effect on section 59A (6).

In 1999, Mr Baldacchino (Respondent) suffered an accepted left knee injury for which he underwent a left knee arthroscopy surgery. After developing posttraumatic arthritis in the left knee he made a claim for medical expenses in respect of a TKR (‘Total Knee Replacement’). The Appellant (Pacific National) declined liability for the proposed treatment because it was not ‘reasonably necessary’. The Arbitrator, in the initial proceedings, referred to the definition of ‘artificial aids’ contained with section 10 of 1926 WCA, consistent with the formulation of the term by Hutley JA in Thomas that a TKR would fall within the definition of ‘artificial aids’.

The Baldacchino appeal considered section 59A (6) of the 1987 WCA which re-enacted the words in section 10 of 1926 WCA. Section 59A (6) provides that:

(6) “this section does not apply to compensation in respect of any of the following kinds of medical or related treatment:

  • the provision of crutches, artificial members, eyes or teeth and other artificial aids or spectacles (including hearing aids and hearing aid batteries)”

The Baldacchino appeal raised an issue regarding whether a TKR was an ‘artificial aid’ within the meaning of section 59 A (6)(a) of the 1987 Act, so that it falls within the exemption in section 59A (6) to the application of section 59A (1) of the 1987 Act. If it fell within this exemption, and the TKR was considered an ‘artificial aid’, then section 59 A (1) did not apply, there was no time limit and compensation ought to be paid.

Ultimately Michael Snell, Deputy President, found that a TKR falls within the meaning of ‘other artificial aids’ for the purposes of section 59A (6) (a) of the 1987 Act, as “a matter of ordinary English”. Because of this the time limit in s59A (1) did not apply.

Baldacchino defined an artificial aid as any internal or external thing which has been constructed to help overcome the effects of an injury. This could allow workers an extensive scope to claim outside of the legislative compensation time frames.

Further, if there an agreed term under a Heads of Agreement, Consent Orders, or a decision from the commission, it is our view, that prima facie if the employer /scheme agent has expressly agreed to pay for surgery, without limiting conditions, then they may be estopped from asserting a section 59A point. Furthermore, from a reputational stand point there may be questions asked of an insurer.

The alternative would leave injured workers in pain and out of pocket with delayed surgery etc and this would be also incompatible with the benevolent social policy underlying the Workers Compensation Act despite the privative provisions introduced in 2012.

The effects of the decision of Baldacchino and the interpretation of s59A and ‘artificial aid’ could potentially have significant ramifications to both insurers and workers alike.

Andrew Kemp, Principal and Jackson Gilbert, Solicitor
Kemp & Co Lawyers