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Nicholls v Accident Compensation Corporation (Revocation of Decision Jurisdiction) [2018] NZACC 7 (31 January 2018)

Last Updated: 21 February 2018

IN THE DISTRICT COURT
AT DUNEDIN

[2018] NZACC 7 ACR 383/16

UNDER THE ACCIDENT COMPENSATION ACT 2001

IN THE MATTER OF AN APPEAL UNDER SECTION 149 OF THE ACT

BETWEEN SCOTT NICHOLLS

Appellant

AND ACCIDENT COMPENSATION CORPORATION
Respondent

Hearing: 24 July 2017

Appearances: W A Forster and T M Barraclough for the appellant

C Light for the respondent

Judgment: 31 January 2018
____________________________________________________________________

RESERVED JUDGMENT OF JUDGE L G POWELL
Revocation of Decision/Jurisdiction to Review
Section 65/134 Accident Compensation Act 2001

____________________________________________________________________

[1] The appellant Scott Nicholls has appealed against a review decision dated 20 November 2016 which dismissed two applications for review “for want of jurisdiction”.
[2] The review applications were two of a number brought by Mr Nicholls in respect of various decisions made by the Corporation. In particular Mr Nicholls had challenged two decisions of the Corporation dated 8 and 13 January 2016 respectively. The decisions had arisen as a result of an application made by Mr Nicholls’ counsel, Mr Forster, on 26 November 2015 which, after setting out the background, sought cover for Mr Nicholls in the following terms:

4. I hereby lodge a claim for cover for a physical injury to my client’s intervertebral disc at L5/S1, being a disc protrusion that occurred in New Zealand by accident on 21 June 2015.
5. Furthermore, in accordance with s 20(2)(g), I lodge an additional claim for cover for an injury consequential on the first injury, being the extension of the disc protrusion that occurred 2/3 weeks following the original injury.
6. This is not a case where s 26(2) or (4) excludes cover because any further injury was consequential on the covered disc injury (2), and there is no evidence of aging process being involved in this case (4).

[3] In response:

• [a] The 8 January 2016 decision (the subject of Review 4532094) declined cover for a “L5/S1 left sided disc protrusion” on the basis it had not been caused by an accident on 21 June 2015;
• [b] The 13 January 2016 decision (the subject of Review 4532591) declined to approve cover for a “disc protrusion – left” the Corporation finding insufficient evidence that the injury had been caused by a gradual process, disease, or infection consequential on an accident on 21 June 2015.

[4] The reviews had originally proceeded with a third review (Review 4532094) which related to a decision suspending Mr Nicholls’ entitlements in respect of the 21 June 2015 injury, but while this review proceeded to hearing in March 2016,^[1] Reviews 4532094 and 4532591 were adjourned to allow further evidence to be obtained and were eventually set down to be heard on 16 May 2016. In the event Mr Nicholls obtained evidence from Jeremy Evison, orthopaedic surgeon, in support of the reviews, and on 21 April 2016 this led to an application for an adjournment by the Corporation, an application granted despite the objections of Mr Forster.
[5] Before the reviews could be set down for a new hearing date, the Corporation by wrote to Mr Nicholls on 27 May 2016 and advised:

Thank you for your patience while we looked into whether we’re able to cover your additional injury that happened on 21/06/2015. You also asked if we’re able to help with your treatment costs.
Following the information received from Mr Evison we are revoking our decision on the 9^th January 2016 and replacing it with this decision.
We’re able to cover your injury and we’ll do everything we can to support your recovery. We’re also able to help with the cost of the treatment you asked for.

Your covered injuries

The injury(s) that we’re now covering for you are:

• Sprain, hamstring tendon – Side: Left
• Lumbar sprain – Side: Not Applicable
• Disc prolapse at L5/S1 – Left

[6] This decision led to discussions between the parties with regard to the disposal of the reviews, with Mr Forster seeking a review decision by consent “to act as a barrier to ACC changing their mind again in the future as to do so would be barred by s 133(2) [of the Accident Compensation Act 2001]”.
[7] No agreement was however reached, and the Corporation subsequently confirmed it did not accept that Mr Nicholls had previously had a deemed decision on cover nor that he was entitled to cover for a gradual process consequential on a personal injury pursuant to s 20(2)(g) of the Act and pointed to the Corporation’s decision of 13 January 2016 declining cover on that ground. As a result Mr Forster requested that Reviews 4532094 and 4539591 be set down for hearing and this took place on 22 September 2016 before Reviewer Dave Walker.
[8] After hearing evidence and submissions from the parties, Reviewer Walker dismissed the reviews for want of jurisdiction for the following reasons:

At the hearing, the parties confirmed that the condition for which Mr Nicholls sought cover was now accepted by ACC. ACC confirmed that in its view, the terms disc protrusion and disc prolapse were interchangeable. Given the contents of Mr Evison’s report and the reference to the medical dictionary definitions provided by Mr Light, I accept this is the case.
I have considered Mr Forster’s submissions. In my view, the decisions of 8 and 13 January 2016 have been overtaken by events. I find that by virtue of the decision dated 27 May 2016, Mr Nicholls has cover for the L5/S1 disc prolapse condition that was sought in the claim lodged by Mr Forster in November 2015.
I note Mr Forster’s submission that I should make a determination about cover in order to prevent ACC from revoking cover under section 65 of the Act. However, I find that as the decisions of 8 and 13 January 2016 are no longer extant, I have no statutory authority to make any determinations on cover. I consider that when read together, sections 65(1) and 148(3) contemplate ACC’s statutory authority to revoke decisions once a review application has been lodged. I also consider that if was to entertain Mr Forster’s submission and take it to its ultimate extreme, then it would be open for everyone to challenge an ACC decision in order to obtain a decision under Part 5 of the Act so as to make section 65 unavailable to ACC.
I note that in pursuing this matter to hearing, Mr Forster distinguishes Mr Nicholls case, stating that he sought two different heads of cover under the Act. However, I find there are many District Court decisions that confirm once cover is accepted for a condition using a particular test under the Act, cover for that condition cannot be granted under another test for cover. Relevant decisions include Regler (149/12), Estate of Henry (178/13), and KL 355/15).
I therefore find that as a result of the decision dated 27 May 2016, cover for the L5/S1 was accepted and this matter is no longer live. The only matter which I am able to consider is that of costs.

[9] The issue in the appeal is whether Reviewer Walker was correct in declining jurisdiction.

The Case for Mr Nicholls

[10] At appeal Mr Forster submitted that:

• [a] Neither the decision of 8 January 2016 nor 13 January 2016 had been validly revoked;
• [b] As a result Reviewer Walker should not have declined jurisdiction to hear the substantive review.

[11] With regard to the first point Mr Forster submitted that the Corporation was unable to revoke a decision once an application for review had been filed. While Mr Forster noted that s 65 of the Act gave a wide discretion to the Corporation to revoke decisions for error he submitted that once a review application had been filed the Corporation “is essentially functus officio”, although he noted that different approaches were taken by reviewers on this issue.
[12] Likewise Mr Forster submitted that it was unclear whether the cover granted by the Corporation’s letter of 27 May 2016 was the same as what had been sought in the 26 November 2015 application, and raised the issue that even if it was Mr Nicholls was entitled to insist that a review decision be issued to prevent the Corporation subsequently changing its mind on the cover then granted.
[13] Mr Forster also raised concerns with how any deemed cover in respect of the application made on 26 November 2015 had been dealt with and with regard to how the review application had been adjourned in May 2016.

Discussion and Analysis

[14] Having considered the submissions of counsel I am satisfied that the Corporation’s decision of 27 May 2016 validly revoked the Corporation’s earlier decision of 8 January 2016. I do not accept Mr Forster’s submission that the Corporation lacks the ability to revoke a decision once a review has been filed. Section 65 of the Act is clear that a decision can be revoked at any time and it would be an unreasonable reading down of the section to limit the power in a way suggested by Mr Forster. If Mr Forster was correct then in every case where the Corporation changes its mind following the filing of an application for review, a review hearing would have to take place before any change in the position of the Corporation could be given effect. Such an approach appears unnecessarily cumbersome and would preclude settlement where the Corporation issues a new decision and a review is then withdrawn prior to hearing, or the simple revocation of the decision otherwise obviates the need for a review.
[15] Having accepted that the Corporation had jurisdiction to revoke the decision of 8 January 2016 it is clear that a valid revocation has taken place. Although the decision of 27 May 2016 records that the date of the decision being revoked as 9 January 2016 rather than 8 January 2016 there is no suggestion that the 27 May 2016 letter could have been referring to any other decision. At that point there can no longer be any substantive or jurisdictional basis upon which Review 4532094 in respect of the 8 January 2016 decision can proceed. The reason for this is that a review under s 134(1)(a) is by definition a review of a decision on the claim, and if that decision has been revoked there is nothing left to review.
[16] It makes no difference with regard to the reviewability of the 8 January 2016 decision that the cover granted as a result of the 27 May 2016 decision granted cover in different terms to that sought in Mr Forster’s letter of 26 May 2016. First, no evidence has been placed before the Court on behalf of Mr Nicholls that what was sought by Mr Forster on behalf of Mr Nicholls and what was granted are substantially different. As Mr Light for the Corporation submitted “prolapse of invertebral disc” is defined in Dorlands Illustrated Medical Dictionary (32^nd edition) as a “herniation of invertebral disc”. A “disc protrusion is defined in Dorlands (under the main heading “protrusion”) as a “herniation of invertebral disc”. The definition is therefore identical, i.e. a disc protrusion and a disc prolapse are the same.
[17] Even if there was a difference the Corporation was in any event not obliged to grant cover in the terms sought by Mr Forster but any issue about the nature of the cover granted following the revocation of the 8 January 2016 decision would have been properly dealt with by seeking a review of the 27 May 2016 decision rather than the 8 January 2016 decision now revoked.
[18] In any event however, Mr Evison’s report, provided on behalf of Mr Nicholls to the Corporation, is quite clear that the injury suffered by Mr Nicholls is in fact a “left L5/S1 disc prolapse”, the cover granted by the Corporation, rather than a “L5/S1 disc protrusion”.
[19] The position is different conceptually with regard to the 13 January 2016 decision. As the Corporation now accepts the decision of 13 January 2016 was not revoked and Reviewer Walker was accordingly wrong to conclude that the 13 January 2016 decision “was no longer extant”, as indeed the Corporation confirmed shortly after the 27 May 2016 decision was issued (see [7] above. Reviewer Walker was however correct to conclude that the 13 January 2016 decision had been overtaken by events and having noted that “the parties confirmed that the condition for which Mr Nicholls sought cover was now accepted by ACC” was entitled to conclude any review in respect of the 13 January 2016 decision was now moot. As Mr Light submitted, because in effect Mr Nicholls had effectively sought cover for the same injury under two different statutory bases, the question of cover under s 20(2)(g) of the Act was moot because Mr Nicholls had cover for that injury as a personal injury caused by an accident. As Fogarty J observed in Sinclair v Accident Compensation Corporation^[2]:

The common law courts do not adjudicate upon academic issues. There has to be real consequence.^[3]

[20] The principles surrounding moot issues at appeal were considered in some detail by the Supreme Court in R v Gordon-Smith^[4]. The Court held, relying on R v Secretary of State for the Home Department ex parte Salem^[5] the reluctance to declare moot issues is not a matter of jurisdiction but one of judicial policy, and as such confirmed:

In general, Appellate Courts do not decide appeals where the decision will have no practical effect on the rights of parties before the court in relation to what has been at issue between them at lower Courts.
...
But in circumstances warranting an exception to that policy, provided the Court has jurisdiction, it may exercise its discretion and hear an appeal on a moot question.^[6]

[21] In R v Gordon-Smith the Court went on to exercise its discretion in favour of hearing the appeal on the basis that:

[29] In summary, the Court has jurisdiction to hear the appeal but must exercise its discretion on whether to do so because the issue is moot. The issue raised by Ms Gordon-Smith’s application is one of public importance which meets the statutory criteria for a grant of leave. The nature of the issue is closely analogous to, if not actually, one in public law, so that Salem applies. The question can be decided in the present appeal in a context which will avoid the disruption to a trail that would otherwise arise. Given that the issue potentially concerns every criminal jury trial, it is highly desirable that the correctness of the Court of Appeal judgment on the point be reviewed promptly.

[22] The type of considerations identified by the Supreme Court in that case are not present in this appeal, and having reached the conclusion he did Reviewer Walker was therefore not required to proceed with the review.
[23] Even if the issue had not been moot on the evidence before the Court, Mr Nicholls could not have succeeded in any event. In particular, in his essentially uncontroverted report which as noted provided the basis for Mr Nicholls receiving cover from the Corporation Mr Evison rejected any submission that Mr Nicholls was “suffering from or incapacitated by a condition that is causally linked to any initial injury he sustained in the event of 21. 06.2015”. Instead Mr Evison concluded it was the initial injury that caused the disc prolapse at L5/S1 for which Mr Nicholls has now been granted cover.
[24] The two final matters raised by Mr Forster can be addressed relatively briefly. First, the question of whether Mr Nicholls was entitled to a deemed decision on cover is also effectively moot given the Corporation’s decision of 27 May 2016 and the nature of cover granted. Finally the issue of whether or not the April 2016 adjournment of the review hearing (see [4] above) was in any way improper is not relevant to the issues before this Court, given the appeal proceeds on the basis the review decision is valid. Had Mr Nichols considered that the review was a nullity the appropriate course would have been to have sought a judicial review to that effect. In such circumstances it is difficult to see what possible comment the Court could make with regard to the issue whether a procedural adjournment should or should not have been granted, particularly given the overall context of the issues now before the Court.

Decision

[25] The appeal is dismissed. There is no issue as to costs.

Judge L G Powell
District Court Judge


Solicitors: P J Sara, Dunedin, for the appellant
Young Hunter, Christchurch, for the respondent

^[1] Whereupon by decision dated 2 May 2016 the suspension decision was quashed.

^[2] [2013] NZHC 374

^[3] At [23]

^[4] [2008] NZSC 56; [2009] NZLR 721

^[5] [1999] UKHL 8; [1999] 1 AC 450

^[6] [2008] NZSC 56; [2009] 1 NZLR 721 at 725-726 paragraph [16]