The consent order says I have fully recovered, but I am not so sure: The effect of consent orders on subsequent claims for permanent impairment – Trustees for the Roman Catholic Church for the Diocese of Bathurst v Hine [2016] NSWCA 213

In previous proceedings brought in the Commission, the parties reached an agreed settlement of a claim for weekly compensation and medical expenses. As part of that settlement, there was a consent order recording a finding that the claimant "has fully recovered from the effects of any work related psychological injury or condition". About six months later, the claimant made a claim for lump sum compensation for permanent impairment resulting from the work related psychological injury.

At first instance, the Arbitrator of the Commission upheld the contention of the respondent that the consent order gave rise to an issue estoppel and prevented the claimant from asserting that she was permanently impaired as a result of the work injury. On appeal, the Deputy President of the Commission overturned the Arbitrator's decision and remitted her claim to the Registrar to make a referral to an AMS for an assessment of impairment resulting from injury.

In the New South Wales Court of Appeal, Meagher JA delivered a judgment with which Leeming JA and Simpson JA both agreed.
There were two issue raised by the respondent's notice of the appeal, being:

1. Whether the claimant has the benefit of the claimed issue estoppel which turns on the Commission's jurisdiction to make a finding that was binding between the parties in terms of a medical dispute as to permanent impairment resulting from injury;
   
   
2. Whether the Deputy President's conclusion as to the application of s 234 of the 1998 Act was correct and provided any basis for denying the efficacy of an issue estoppel.

In relation to the first issue, Meagher JA noted that the prior proceedings in relation to the determination of the dispute for weekly compensation and medical expenses did not include a claim for lump sum compensation. If it had, Meagher JA confirmed that a dispute concerning the degree of permanent impairment resulting from an injury is a medical dispute that must be referred for assessment and the Commission must determine that claim in accordance with that assessment. The Commission cannot make or act on its own assessment or finding in relation to such a medical dispute. Therefore, in the previous proceedings, the Commission did not have any jurisdiction to make an order that was binding on the parties in relation to a medical dispute as to the degree of permanent impairment resulting from injury.

Meagher JA noted the Deputy President relied on s 234 of the 1998 Act as a basis for setting aside the Arbitrator's award. Meagher JA stated that it was not contended that the claimant was prevented from pressing her claim. What was contended was that the consent orders created an issue of estoppel. This ground of appeal was made out but it did not affect the outcome of the appeal.

This case confirms that claims for permanent impairment are only finalised either by agreement and the execution of a complying agreement, or by assessment of an AMS in the event of a dispute.

The decision is a reminder for insurers to consider a worker's potential entitlement to lump sum compensation for permanent impairment even if no claim has been made. This is particularly important when considering compromised settlements in the context of a disputed claim in the Commission.