AAI Limited t/as AAMI v Backhouse
[2025] NSWPIC 28
•30 January 2025 amended 4 February 2025
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as AAMI v Backhouse [2025] NSWPIC 28 |
| CLAIMANT: | Julia Backhouse |
| INSURER: | AAMI |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 30 January 2025 amended 4 February 2025 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; settlement approval; $85,000 economic losses only; 33-year-old teacher; approved under section 6.23(2)(b); injuries include fracture to left wrist and thumb well healed, scarring 2% whole person impairment; closed period past economic loss and small buffer for future; Held – settlement complied with clause 7.37 Motor Accident Injuries Guidelines version 9.3. |
| DETERMINATIONS MADE: | AMENDED CERTIFICATE Issued under s 6.23 of the Motor Accident Injuries Act 2017 1. The proposed settlement in the sum of $85,000 is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. 2. The proposed settlement complies with cl 7.37 of the Motor Accident Injuries Guidelines version 9.3. |
STATEMENT OF REASONS
INTRODUCTION
Julia Backhouse (the claimant) was driving her motor vehicle when the insured failed to give way at the intersection of Culwurra Street and King Georges Road at South Hurstville, where a collision occurred. She is currently aged 33 years.
The claimant was transported to St George Hospital by ambulance for treatment. She was administered with a plaster backslab to her left arm and sling and discharged into the care of her general practitioner.
The claimant’s sustained a fracture to her distal radius and thumb of her left hand. Which subsequently required surgical intervention on 12 April 2022 the following day.
The claimant attended upon her general practitioner Dr Hanif on 11 April 2024 and was referred to orthopaedic surgeon Dr Nabarro who subsequently recommended surgery which was undertaken ton 12 April 2022.
The claimant the following day underwent surgery for open reduction and fixation of her left distal radius and left 1st metacarpal at St George Private Hospital. She was discharged the following day in a cast.
The claimant brought a claim for common law damages alleging she sustained the following injuries:
(a) fracture distal radius left hand;
(b) fracture thumb left hand, and
(b) scarring.
An Application for personal injury benefits was lodged (document A2) on 8 April 2022.
The claimant brought a common law claim for damages.
The insurer admitted liability for the common law claim on 23 September 2024.
As a consequence of the assessment of whole person impairment 2% for scarring post surgery the parties agreed the claimant had no entitlement to non-economic loss as whole person impairment did not exceed 10%, the percentage threshold required to be met to qualify for damages for non-economic loss.
The parties have reached an agreement to settle the claim in the sum of $85,000. The amount represents the sum of $15,000 for past economic loss and a buffer of $70,000 for future economic loss.
Past economic loss
The claimant was employed as a school teacher at the time of the accident. She took off a period of two weeks post-surgery and returned to full duties six weeks post-surgery. She has been certified fit for full duties as contained in various certificates of fitness issued by Dr Nabarro dated between 11 April 2022 and 7 September 2022. The other by general practitioner Dr Tierney (document A10).
At the date of the accident the claimant’s pre-injury earning capacity weekly net pay according to payslips was $1,502.30 for a 38 hour week. The claimant was unfit for work due to her injuries and claimed the difference between her pre-accident earning capacity and her actual earnings over the period from the date of accident to date.
The insurer calculated the past economic loss by calculating the expected earning capacity uninjured and subtracted the actual earning capacity and the difference was the established loss. Losses of $5,107.65 were broken down as follows:
(a) period 7 April 2022 to 8 April 2022 = $600.85;
(b) school holidays – two weeks holiday pay = $ nil;
(c) 26 April 2022 to 29 April 2022 = $1,201.70;
(d) 2 May 2022 to 15 May 2022 = $600.85;
(e) 15 May 2022 to 29 May 2022 = $901.28, and
(f) 30 May 2022 to 12 June 2022 = $1802.57.
Superannuation was calculated at $561.84.
Income tax paid was allowed in the sum of $3,468.
Total past losses amounted to $9,137.49 rounded up to $15,000.
Future economic loss
Whilst the claimant has returned to full-duties as a teacher, the insurer accepted that from time to time the claimant may require a day off for conservative treatment which would require time off. Albeit the medical opinion of treating Drs Teirney, Nabarro and physiotherapist Kikilas all state fitness for pre-injury duty for work home and community is not impacted. Dr Rimmer the medico-legal opinion provided by the insurer concluded that the injuries “are not likely to affect her employment given the fact she had returned to pre-injury duties and hours all without difficulty”.
The insurer considered a buffer of $70,000 inclusive of superannuation appropriate for future economic loss covering a period of a work life expectancy of a further 34 years.
The claimant confirmed during the preliminary conference she had not required any time off to date since the post-surgery return to work in June 2022. A period of nearly three years.
Noting that the injuries are well healed and there has not been any further time off for injury related cause since 13 June 2022 the claimant and insurer in 2025 are both confident that the impact on future economic loss is likely to be very minimal.
The application before me is for the approval of the settlement reached between the parties.
THE RELEVANT LAW
Sections 6.23(2) and (3) of the Motor Accident Injuries Act 2017 (MAI Act) requires approval of the settlement and I am not to approve the settlement unless I am satisfied it complies with any of the requirements of the MAI Act and the Motor Accident Guidelines version 9.3 commencing 4 December 2024 (Guidelines).
Clause 7.37 of the Guidelines states I must be satisfied as to the following:
(a) repealed
(b) the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments for the claim were the matter to be assessed by the Commission, taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by the claimant, and taking into account any proposed reductions or deductions in the proposed settlement,
(c) the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner,
(d) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
Preliminary conference held on 14 January 2025
The conference was conducted via video-link. On this occasion the nature of the settlement was discussed. The claimant advised she held no great concern following an extended period without symptoms or impact on her work and activities of daily living.
The claimant reported she was back at work and had been since June 2022 without further incident. Whilst she has changed the way some of her tasks are performed to favour the uninjured wrist, she manages well.
She confirmed no current treatment was being undertaken and reported no ongoing symptoms. She had seen her doctors to confirm any risk of arthritic change after an opinion of Matt Hoenig physiotherapist reported some concerns had received a positive response from further enquiries undertaken by the insurer’s Dr Rimmer. He opined the following:
“on the balance of probabilities, Ms Backhouse is NOT at risk of developing osteoarthritis for the following reasons…
(iii) Both fracture ie. Left thumb and distal radius were extra-articular
(iv) At the time of assessment clinical examination of both the left thumb and left wrist were entirely normal”.
At this point I informed the claimant that should she wish to, there was still time to seek legal opinion before the matter was concluded. The claimant confirmed “I do not wish to seek legal advice and I’m happy with the offer made by the insurer”.
I asked the claimant if she had any questions relating to the settlement and was she aware that the statutory payments already made by the insurer would be credited to the insurer and that whilst the sum of $85,000 was the settlement figure, she would receive a net sum of $73,186.42 in her hand as $11,813.58 would be deducted.
She confirmed she was aware of the deduction and had received that sum from the insurer in weekly payments.
During the conference the claimant was questioned on her understanding of the settlement, its finality, the impact of a settlement and whether she was entering the settlement on her own free will. I am satisfied by her responses, that she is entering into the settlement of her own free will, with understanding of its finality.
The claimant confirmed she knew she could seek legal advice and had chosen not to avail herself of legal representation.
Statutory payments were confirmed by the insurer in the sum of $11,813.58 as contained in the list of payments annexed to the application at page 26.
The parties confirmed their desire for the settlement to be approved and advised there was no other information to be relied upon.
DOCUMENTS CONSIDERED
I have regard to the following relevant documents contained in evidence bundle of 127 pages:
Liability:
(a) police report dated 19 April 2022;
(b) Application for statutory benefits dated 8 April 2022;
(c) police report dated 19 April 2022;
(d) Application for common law damages;
(e) liability notice dated 5 March 2021;
(f) Deed of Release – dated 12 July 2024, and
(g) submissions of the insurer dated 2 December 2024.
Medical records:
(a) medical certificates Dr Nabarro;
(b) St George Hospital records;
(c) independent medical examiner (IME) report of Dr Rimmer dated 28 March 2023 and 12 November 2024;
(d) reports of Mark Nabarro dated 19 April 2022, 30 June 2022, 25 August 2022 and 3 October 2024;
(e) report George Kikilas dated 23 August 2022;
(f) physiotherapist report dated 14 October 2024;
(g) operation report 12 April 2022, and
(h) Certificates of Capacity dated 18 January 2019 to 30 March 2020.
Financial records:
(a) pre-accident payslips (document A16), and
(b) post-accident payslips (document A17).
Claimant’s information:
(a) replies to particulars 23 October 2024, and
(b) responses obtained in preliminary conference held 14 January 2025.
Settlement documents:
(a) Settlement Offer dated 18 November 2024, and
(b) Deed of Release dated 29 July 2024.
Injuries
The claimant’s Application for common law damages noted she sustained the following injuries:
(a) injury to left wrist and thumb, and
(b) scarring.
Non-economic loss
As the claimant’s injuries to her left hand which included a fracture of distal radius and thumb have now resolved these injuries resulted in an assessment of 0% whole person impairment (WPI)WPI. The impact of scarring was assessed by Dr Rimmer at 2% WPI and this assessment is beneath the statutory threshold of 10% whole person impairment entitling the claimant to damages for non-economic loss.
On the available medical evidence, and noting the successful healing of the injuries to her left wrist and thumb, I am satisfied that the claimant would not be entitled to non-economic loss as the whole person impairment of her injuries have not exceeded the threshold required.
Past economic loss
I am satisfied that the past losses agreed to between the parties accords with the financial records produced by the claimant which included pay slip and the medical records and certificates of fitness issued by Dr Tierney and Nabarro. The claimant confirmed she was off for six weeks post-surgery by Dr Nabarro on 12 April 2022 and had no other time off.
Future economic loss
The claimant was working as a teacher at the time of the accident. She has since June 2022 returned to full-duties with no further time off.
Medical opinions of the majority treating doctors, physiotherapists and medico-legal report writers have all confirmed the claimant has reported being able to work in her pre-injury capacity with no time off, with the exception of Matt Hoenig, whose report will be discussed below.
Her duties as a design and technology teacher specialising in woodwork requires her to:
“…carry timber and other heavy materials, using a variety of power and manual tools, manipulating screws and nails and a lot of drawing and sketching on whiteboards. She has attempted to undertake exercise to strengthen her wrist to enable her to be able to participate with her students and be more active in the classroom”.
Whilst she reported these difficulties in the report to Matt Hoenig as contained in his report at page 90, during the video conference she confirmed to me she had no recent time off from work due to any ongoing problems with her wrist. His opinion as to long-term impact of her injuries, impact on job prospects, psychological outcomes and prognosis into the future did not accord with the other reports of Dr Nabarro and Dr Rimmer. Their expertise is considered more extensive in prediction of ongoing problems and so the opinion of Mr Hoenig as a physiotherapist and exercise physiologist is less persuasive and outside his area of expertise.
With the birth of her second child, the claimant will be taking maternity leave.
A buffer has been allowed in the sum of $70,000 for any loss of impact to her future earning capacity, which seems reasonable considering the claimant has in close proximity to the accident and time required to heal from surgery, not suffered further economic loss. Whilst Matt Heonig’s report considers there to be greater consequence to her earning capacity and career in the future, his opinion is outside his area of expertise, he is not a vocational capacity expert.
I am satisfied on the information before me, that the provision of a small buffer is appropriate where there has been limited loss to date, now nearing three years post-accident.
Insurer’s submission
It is the insurer’s submission that the proposed settlement figure is an appropriate one and complies with the requirements of cl 7.37 of the Guidelines, in that it is:
“…just, fair and reasonable and within the range of likely potential damages assessments for the claim were the matter to be assessed by the Commission, taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by the claimant.”
Accordingly, the insurer submitted that the proposed settlement figure of $85,000 be approved.
Claimant’s submission
The claimant confirmed her desire that the settlement be approved by me.
Impact of injuries upon the claimant
The claimant’s statement of particulars dated 23 October 2024 noted at page 124 of the application bundle provides a picture of the initial difficulties the claimant suffered when she first sustained her injuries. “At the time of injury, I had a 7-month-old child who I was unable to pick up safely, which made this time particularly challenging”.
At completion of her treatment she noted “I was advised no further medical treatment would improve my outcome to my thumb and wrist.”
Her reported concerns of developing further problems such as arthritis, were alleviated by the supplementary report of Dr Rimmer undertaken by the insurer in response to the comments of Matt Heonig.
The claimant reported in her statement that she continues to be in pain from time to time when she weight bears upon her left wrist. “...Every time I need to get off the floor after playing with my children or picking up a heavy bag of groceries, my wrist is weak”.
The use of a laptop and thumb movements have also “brought on a sense of fatigue to the left thumb area”.
The claimant reported undertaking sporting activities such as competitive sailing pre-accident and the extent to which she participates in this activity has now reduced due to her injuries.
REVIEW OF THE EVIDENCE
Clinical records of St George Hospital provided treatment details and wound management.
The operation notes of Dr Nabarro give details of surgery performed and the positive outcome.
The report of Clinical Physio Solutions dated 14 October 2024 provided an updated history of the ongoing impact of the injuries sustained upon activities of daily life. The operation has left her with 10 screws and two plates in her wrist and hand. Her activities of daily living have been altered with her use of the right arm to compensate for the difficulty associated with the left wrist and thumb.
The claimant is due to have her second child any day and this is likely to impact on her ability to carry her newborn and likelihood of possible aggravation to her left wrist with the necessity to lift and carry as occurred with her first child.
Physiotherapy and rehabilitation records of George Kikilas produced confirm that post surgery wrist extension was a concern. The further examinations of Dr Rimmer do not indicate there is an ongoing problem of wrist extension as at November 2024. He reported “Today’s clinical and functional findings on examination were normal examination of the left thumb and wrist.
She reported to Dr Rimmer in 2023 that her left wrist felt “a little bit weak” and that “She claims upon dorsi flexion there is some discomfort.” (Page 92 of bundle.)
The supplementary report of Dr Rimmer dated 12 November 2024 in response to the comments of Matt Heonig addressed any impact on the claimant’s ability to perform her duties as a design and technology high school teacher specialising in woodwork. His response was: “No, the injuries are not likely to affect her employment given that at the time of her assessment she has returned to pre-injury duties and hour all without difficulty.” This was similar to the responses given to me during the preliminary conference.
The payslips of Good Samaritan Catholic College Hinchinbrook provided me with the claimants pre and post injury earning capacity. The losses claimed accord with the primary evidence contained in the payslips.
SHOULD I APPROVE THE SETTLEMENT
Section 6.23 of the MAI Act provides the following restrictions on settling claims for damages:
(a) the settlement must be approved by a Member of the Personal Injury Commission (Commission) and I am not to approve the settlement unless I am satisfied there is compliance with any of the requirements of the MAI Act and the Motor Accident Guidelines.
I am satisfied that there has been compliance with the MAI Act and the Guidelines.
(b) the insurer to include in its application details of the following:
(i)the amount of the proposed settlement and a breakdown of the amount allowed for each head of damage.
The amount for past economic loss is $15,000, and
the amount for future economic loss is $70,000.
(ii)the amount of any deductions in the proposed settlement.
The insurer has paid to the claimant statutory payments in the sum of $11,813.58 which it seeks credit. The claimant will receive net proceeds of $73,186.42.
(iii)the amount of any advanced payments made be specified. There had not been any advanced payments made apart from known statutory benefits.
Medical expenses have been met by the insurer and these do not form part of the settlement.
(iv)the evidence, documents and materials relevant to an assessment of the proposed settlement figure.
I have reviewed the clinical and medical records effectively covering the period of injury and the relevant period to date. I note the medical records accord with the claimant’s reported symptoms and periods of incapacity. The financial records provided accord with the claimant’s history of earning capacity and time off work taken due to her injuries and surgery. The information produced by the insurer has given me a good indication of the injuries, treatment and prognosis.
(c) Clause 7.37 of the Guidelines, requires me to consider the following:
(b)the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments for the claim were the matter to be assessed by the Commission, taking into account the nature and extent of the claim and injuries, disabilities impairments and losses sustained by the claimant, and taking into account any proposed reductions or deductions in the proposed settlement.
Having reviewed the medical evidence produced in this matter, I am satisfied that the claimant has made good recovery and has returned to work with limited restriction. The amounts allowed for past and future economic loss accords with the facts and likely circumstances but for the accident. I find the sum agreed upon is just, fair and reasonable and within the likely range of damages were it to have been assessed by a Member of the Commission,
(c) the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner – this was confirmed during the preliminary conferences
(d)the claimant understands the nature and effect of the proposed settlement is the finality of her claim for damages and is willing to accept the proposed settlement.
The claimant was made aware in the teleconferences that in the event she took the settlement, she could not seek any further damages for non-economic losses and economic losses. She was advised that the insurer would still provide ongoing medical treatment and care needs, if required and approved by the insurer based upon medical need.
The claimant was also made aware that the insurer would continue to meet any charge issued by Medicare and that the insurer has agreed to reimburse Health Insurance Commission separately, if appropriate.
I am satisfied that the claimant was aware of her rights and had freely agreed to the terms of settlement with an understanding of the settlement and its implications.
CONCLUSION
I am satisfied the proposed settlement of $85,000 is just, fair and reasonable and within the range of likely potential damages assessments if the claim was to proceed to assessment by a member of the Commission taking into account the nature and extent of the claim, the injuries, disabilities, impairments and losses sustained by the claimant.
I am satisfied the claimant was aware she could seek legal advice and but chose not to retain legal representation.
I am satisfied the claimant understands the binding nature of the settlement and that she will be precluded from making a further claim for damages arising out of the subject accident.
I am satisfied the claimant was willing to accept the proposed settlement and her decision to accept it was of her own volition.
I am satisfied the claimant is aware that $11,8813.58 will be deducted from the proceeds of settlement and that she will receive $73,186.42 net.
Accordingly, pursuant to s 6.23(2)(b) of the MAI Act I approve the settlement of the claimant’s claim for damages in the sum of $85,000.
The proposed settlement complies with cl 7.37 of the Motor Accident Injuries Guidelines version 9.3.
Legislation
In making my decision I have considered the following legislation and guidelines:
• MAI Act;
• Motor Accident Injuries Regulation 2017, Personal Injury Commission Regulation 2020, Motor Accidents and Workers Compensation Legislation Amendment Regulation 2020, and
• Motor Accident Guidelines version 9.3 / Personal Injury Commission Rules 2021.
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