Hornby v Accident Compensation Corporation [2009] NZCA 576; (2010) 9 NZELC 93,476 (9 December 2009)

Last Updated: 6 January 2012

IN THE COURT OF APPEAL OF NEW ZEALAND

CA131/2009

[2009] NZCA 576

BETWEEN SHARON ROBYN HORNBY
Appellant

AND THE ACCIDENT COMPENSATION CORPORATION
Respondent

Hearing: 16 September 2009

Court: O'Regan, Arnold and Ellen France JJ

Counsel: A C Beck for Appellant
B A Corkill QC and M M Ahern for Respondent

Judgment: 9 December 2009 at 2.30 pm

JUDGMENT OF THE COURT

1. The appeal is dismissed.
2. We answer the first of the questions on which leave was granted in the negative. No answer is necessary on the second question.

100. No order as to costs.
     

REASONS OF THE COURT

(Given by Ellen France J)

Table of Contents

Para No.

Introduction [1]
Factual background [4]
The statutory definition [23]
The District Court decision [24]
The decision in the High Court [28]
Arguments on appeal [32]
Discussion [34]
Costs [40]

Introduction

[1] On 10 March 2000 the appellant broke her left arm while getting out of a car. Her recovery did not proceed well. That was because the fracture did not heal well meaning further surgery was required. She also suffered pain from a pinched nerve in the area of the break. The appellant received accident compensation cover in relation to her physical injuries. In January 2004, she sought cover for mental injury arising from the break. Her claim was declined on the basis that her mental injury was not because of the physical injuries.
[2] Both the appellant’s review and her appeal to the District Court against the decision declining cover were unsuccessful. She obtained leave to appeal to the High Court but, in a decision delivered on 10 September 2008, Dobson J dismissed the appeal: HC WN CIV 2008-485-763. Dobson J having refused leave to appeal, this Court granted leave to appeal on two questions [2009] NZCA 33; ((2009) 19 PRNZ 236):

(a) Did the High Court adopt the wrong test to determine whether mental injuries are suffered “because of physical injuries” pursuant to s 26 of the Injury Prevention, Rehabilitation, and Compensation Act 2001 (the Act)? and

(b) If so, on the correct test, is the appellant entitled to cover?
[3] The issue raised by these questions relates to the impact of the appellant’s pre-existing mental condition (anxiety and depression) on her entitlement to cover for mental injury.

Factual background

[4] As we have indicated, the appellant continued to suffer from pain in her left arm and elbow after the break. Between 2000 and 2003, she was seen by a number of specialists and her general practitioner, Dr Don Mackenzie.
[5] In 2002, the appellant underwent a comprehensive pain assessment at the community rehabilitation centre. An extensive report was provided following this assessment on 24 May 2002. The report included a psychological assessment which disclosed a history of depression and panic attacks prior to the accident in March 2000. We interpolate here that the material before the Court indicates that the appellant was seen by various psychological services over the period from May 1993 to March 1998. She had undergone counselling and had been prescribed medication for her difficulties. It appears that the depression resulted from marital and other familial difficulties. The pain assessment report noted that while some of the appellant’s difficulties including depression were apparent before the injury, the stress involved in managing pain and reduced functionality exacerbated the issues. Stress factors identified in the report included managing the pain, ongoing disputes with the Accident Compensation Corporation (the Corporation), marital and other familial problems.
[6] There were further assessments of the appellant in mid to late 2003. These assessments took place in the context of the appellant’s application for an independence allowance. The initial assessment by Dr Alan Walker was that the appellant had a 13 per cent whole person impairment. The appellant successfully sought a review of the Corporation’s decision on the independence allowance application and a further reassessment was arranged. Mr Colin Fitzpatrick, an orthopaedic surgeon, undertook the reassessment. In his report of 26 November 2003, he found the appellant’s whole person impairment was only ten per cent. The report made no reference to mental injury or effects arising out of the injury for which the appellant had cover. The appellant’s review of the whole person impairment assessment was unsuccessful.
[7] It was not until January 2004 that the appellant approached the Corporation indicating she was suffering from a mental injury as a result of her physical injury from the fall on 10 March 2000.
[8] The Corporation sought information about this claim from the appellant’s general practitioner, Dr Mackenzie. Dr Mackenzie replied by letter dated 28 February 2004 in which he described his diagnosis as “Exacerbation of pre-existing anxiety and depression”. Dr Mackenzie referred to the appellant’s treatment by psychiatric staff at the hospital for anxiety and depression and noted she had been prescribed medication for depression and anxiety for “some years” before the accident. Dr Mackenzie concluded that he did not consider the injury had resulted in a “permanent impairment in a psychological sense” but there was “a definite temporary exacerbation of her pre-existing depressive illness”.
[9] The next report we note is that of 26 April 2004 from Dr Wendy Waddington who was a psychiatric registrar at the local hospital. She told the Corporation that the appellant had had psychotherapy over a period in 2003 and that:

[The appellant] was troubled by anxiety related to difficulties consequent upon an injury to her arm. This had resulted in significant pain and loss of function.

[10] In its decision on 29 April 2004, the Corporation said that the appellant’s claimed mental injury was the result of exacerbation of pre-existing anxiety and depression. The Corporation declined her claim for cover for mental injury.
[11] The appellant unsuccessfully sought a review of that decision. The reviewer concluded that the mental condition was pre-existing at the time of the accident in March 2000.
[12] We then need to refer to a further report of 12 May 2004 from Dr Mackenzie to the Corporation. In that report the doctor said:

I wish to reiterate that [the appellant] has, from my observations of her, suffered a significant period of stress, coinciding with her accident on 10.3.2000. ... [W]hile there is no doubt that [the appellant] had pre-existing psychological conditions, the combination of her left humerus fracture complicated by radial nerve damage, in addition to her later ankle and right wrist fractures of 1.1.03, significantly increased the level of [the appellant’s] anxiety and depression, which appears to be a mental stress arising from her physical injuries. [The appellant] developed a prolonged period of anxiety and exacerbation of her depressive illness as a result of the suffering and incapacity related to the above injuries, in addition to her pre-existing anxiety/depression ... .

[13] In a later report of 11 February 2005, Dr Mackenzie wrote to the Corporation as follows:

I have observed an increased level of anxiety at [the appellant] has had significant difficulty coping with her multiple disabilities which have resulted from the combination of injuries which have affected her dominant left arm, as well as the right arm and the left ankle. Part of the stress with which [the appellant] has been struggling is the difficulty she has been experiencing when dealing with [the Corporation] and their administrative requirements. Therefore I must conclude that [the appellant’s] accidents have significantly increased the level of her anxiety and depression, which would appear to amount to mental stress arising from physical injuries.

[14] Dr Mackenzie’s further report on 21 December 2005 confirmed that the appellant had a “longstanding pre-existing problem with anxiety, depression and panic attacks prior to the accident” in March 2000 and described her arm accident as but one of a “series of” crises the appellant had faced.
[15] We then need to refer to the reports of Dr Christopher Wisely. He was the psychiatric expert who provided expert reports on behalf of the appellant. In his first report of 6 September 2005 he referred to the circumstances of the appellant’s physical injuries in March 2000, the problems that resulted and her extensive battle with the Corporation.
[16] Dr Wisely said that the appellant’s injuries and her fear of re-injuring herself affected her daily life. He also set out the appellant’s past psychiatric history. Dr Wisely concluded that he considered the appellant had “a number of psychological disturbances relating directly to her arm injury. Many of the circumstances around the injury were clearly extremely traumatic at the time, and she has a degree of post-traumatic stress disorder [PTSD] about this”. He continued:

Her previous history indicates some anxiety and panic attacks and depression. She is on treatment that covers these matters, but the specific content of her symptoms currently is related directly to her arm and the specific symptoms she gets from it. ... Finally her frustration has been compounded by the difficulties in receiving help from [the Corporation] and having some sort of acknowledgment of her difficult path.

[17] In his report of 23 September 2005, Dr Wisely diagnosed the appellant as suffering from PTSD that was clinically significant.
[18] On the question of whether the appellant’s mental injury was “because of” physical injury covered by the Corporation in terms of s 26(1)(c), Dr Wisely rejected the Corporation’s assertion that the mental injury was an outcome of the circumstances of both her physical injury and pre-existing problems. Dr Wisely said this:

The problems I have discussed relate entirely to the circumstances of her accident with the physical injury itself, and the difficulties that followed from it. Her tripping and falling in the gutter would not have caused her in my view all the consequences that it did without the extremely painful physical breaking of her arm that occurred as a result of that. Flow-on effects that took place include the difficulties experienced at the hospital, the ongoing anxiety and depression and symptoms of [PTSD] that occurred, and then subsequently falling and breaking more bones. In my view, these are all part of a sequence, and it would be foolish to attempt to dissect them out into single incidences.

[19] Dr Wisely acknowledged the appellant’s history but said that the injury caused “specific issues with anxiety and depression”. Dr Wisely considered that the appellant was “relatively stable” prior to the accident and had a “marked exacerbation of symptoms of anxiety and depression secondary to that”. He took the view that her broken arm was the sole cause of her PTSD and that had become complex due to the other events surrounding her treatment and the subsequent injury she has suffered.
[20] On 31 October 2005, the Corporation obtained the appellant’s clinical notes from the relevant health board. These notes and other relevant reports were forwarded to Dr David Stoner, consultant psychiatrist, for review. In his report of 15 November 2005, Dr Stoner concluded that the appellant’s mental injury preceded the date of the physical injury. Dr Stoner said:

It is my opinion based on a review of the notes that the anxiety and depression symptoms were possibly exacerbated by the physical injury suffered on the 10 March 2000, but were not caused by the injury itself.

[21] Dr Stoner questioned Dr Wisely’s PTSD diagnosis. His opinion was that whatever diagnosis the appellant suffered from:

[T]his was not changed by the injury, but the injury may have precipitated ... further symptoms. She [has] a history of depression, this is a chronic relapsing illness, which is episodic in nature.

...

I do not think it is reasonable to accept that the physical injury is a material cause of the mental condition. It is my opinion that she has a pre-existing condition, which the physical injury has probably highlighted. The physical injury itself may have become, as stated above, a conduit for other frustrations and anxieties that [the appellant] may have.

[22] Dr Wisely in response, in reports of 8 December 2005 and 3 February 2006, was critical of Dr Stoner’s methodology and of the approach taken by the Corporation to these matters.

The statutory definition

[23] The key provision in this case is s 26(1) which defines “personal injury” as including:

(c) mental injury suffered by a person because of physical injuries suffered by the person;

The District Court decision

[24] Essentially, Judge Cadenhead rejected Dr Wisely’s diagnosis of PTSD. That means that the mental injury in issue was depression. On that, the Judge said that this mental condition was present and “the most that can be said was the accident may have aggravated the pre-existing condition”: at [70].
[25] Judge Cadenhead considered that the appellant suffered from a major depressive disorder that pre-dated the accident. Judge Cadenhead continued at [71]:

There have been a number of factors other than the physical injury itself, which have significantly contributed to the onset and continuation of the appellant’s depression. Dr Mackenzie in his report of 21 December 2005 acknowledges that the appellant has had a longstanding problem with anxiety and depression and panic attacks prior to the accident of 10 March 2000. He is the appellant’s general practitioner and his opinion is consistent with the history and factual scenario in this case.

[26] The Judge said it was “difficult” to see how the type of injury suffered could “generally give rise to a significant mental injury as put forward here” by Dr Wisely: at [72]. Further, the Judge noted at [72]:

The nature and circumstances of the injury must in most cases be an important measuring rod in determining whether the alleged mental consequence is a direct consequence arising from the physical injury.

[27] The Judge took into account the fact that Dr Stoner had not examined the appellant and so his opinion must “generally be given less weight” than that of someone who has: at [74]. However, the Judge continued at [74]:

[T]he overall medical evidence, the type of accident and the medical history of the appellant lead to a view that the appellant cannot establish to a balance of probability that can show that appellant’s medical condition arises because of the physical injuries suffered.

The decision in the High Court

[28] In terms of the approach to the law, Dobson J considered that this Court’s decision in Accident Compensation Corporation v Ambros [2008] 1 NZLR 340 did not alter the requirement as set out in Harrild v Director of Proceedings [2003] 3 NZLR 289 (CA) for a “degree of connection” that shows the mental injury results from the preceding physical injury: at [22]. His Honour adopted the phrase “results from” as used in Harrild as the appropriate means of establishing the connection.
[29] In applying that approach to the facts, the Judge noted the District Court Judge’s finding that the mental injury was not caused by the physical injury but rather pre-dated it.
[30] Dobson J said at [28] that the medical evidence which was preferred here:

[T]reated the appellant’s pre-existing depression as asymptomatic at the time of her physical injury in March 2000. The accident triggered her pre-existing mental injury resulting in it becoming symptomatic. However, that is not sufficient to establish causation, because the mental injury does not result from the physical injury suffered in the accident. To make such a finding is to ignore her pre-disposition to that consequence, arising from the mental injury which she had previously suffered from.

[31] On this basis, the Judge dismissed the appeal.

Arguments on appeal

[32] The appellant argues that this was a case of multiple causes. The appropriate approach to that was to apply the common law “but for” test as the appellant says is envisaged by Ambros. Further, the appellant says that the aggravation causes an effect, namely, to make things worse. For the appellant, Mr Beck submits that the appropriate question to ask is, “What effect did this accident have?” Mr Beck also submits that the depression was not present because there were no symptoms. He sees this as a case of susceptibility or “eggshell skull”. Further, Mr Beck argues that it was not inevitable that the mental injury would have happened but for the accident. Finally, the appellant suggests that a generous approach to the question of causation better reflects the social contract embodied in the accident compensation legislation and the policy of the Act.
[33] For the Corporation, Mr Corkill QC submits that the statutory language requires a direct and substantial link between the injury and the mental health issues. Mr Corkill argues that the effect of Ambros is that the Court should stick with the statutory language. His concern about adopting a material contribution test of the sort proposed by the appellant is that this could be anything more than de minimis. In Mr Corkill’s submission, that is not sufficient in the accident compensation context.

Discussion

[34] This Court in granting leave said that there were analytically three possible situations that might arise. First, mental injury arising out of an accident and resultant physical injuries. Secondly, a pre-existing mental condition may be aggravated somehow, solely because of the physical injuries. Thirdly, the physical injuries may have been a contributing cause, although not the only contributing factor to, the resurgence of a prior mental affliction. (We note here that Mr Corkill advised that the Corporation accepted only that the first category came within s 26.)
[35] The Court considered this case was in the third category and saw that as the more problematic scenario in terms of causation. However, having had the opportunity for a closer examination of the facts, we have concluded that this is not a multiple causes case.
[36] The first point to note is that the appellant accepts that, given the limited nature of the right of appeal to this Court, we must proceed on the basis of the facts as found by Judge Cadenhead. That means the appeal must be considered against the background of the rejection of her claim, based on Dr Wisely’s report, that she suffered from PTSD. If that diagnosis had been accepted, it appears that the position in terms of cover would have been different. On the facts, as found in the District Court, however, the “mental injury” in issue is her depression. The evidence is that the appellant suffered from depression and that, over a period, it was possible that things would happen which might reactivate the condition. As the High Court Judge put it in the leave decision:

[10] ... On the most literal of “but for” tests, the episode of the relevant mental disorder recognised in the appellant on the first occasion after she broke her arm may not have occurred at that time and in the circumstances it did, if she had not broken her arm. However, that does not constitute the breaking of the arm “a cause” when any one of a range of sources of stress might equally have produced the extent of symptoms of a further episode of a recurring mental disorder that ensued for her.

[11] In other words, where the appellant already suffered from the mental disorder with the extent of its symptoms being episodic, a particular physical injury may provoke a change in the extent to which the symptoms are demonstrated, but not constitute “a cause” of the disorder.

[37] We agree with Dobson J’s analysis. Essentially, the appellant does not get cover because her depression has nothing to do with the injury. This is not a case of susceptibility or eggshell skull but, rather, one where the appellant has a condition which was not brought on by the accident. Even on the approach taken by the appellant’s doctor, Dr Mackenzie, the break to her arm has made her symptoms worse but has not caused her depression. It may be relevant, although the point was not addressed by either Dr Wisely or Dr Stoner, that at the time of the accident the appellant was still being prescribed anti-depressant medication which presumably may have impacted on the extent to which she presented with those symptoms at that time.
[38] That is sufficient to dispose of the appeal. We add that we did hear argument on what the test for causation in these cases should be. That turns to some extent on the scope of Ambros. However, we do not consider this is an appropriate case to resolve that question given the factual underpinning for the argument is absent. We appreciate the desire of the parties to get a steer from this Court on this but the fact that s 163(4) of the Act states that the decision of this Court on an appeal is final indicates that a cautious approach should be adopted.
[39] Accordingly, for these reasons, the appeal is dismissed. We answer “no” to the first of the questions for which leave was granted which means that there is no need to answer the second question.

Costs

[40] The appellant is legally aided. In any event, the Corporation did not seek costs and so we make no order for costs.

Solicitors:
Peter Sara, Dunedin for Appellant
Accident Compensation Corporation, Wellington