AAI Limited t/as AAMI v Dennett
[2023] NSWPIC 505
•28 September 2023
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | AAI Limited t/as AAMI v Dennett [2023] NSWPIC 505 |
| CLAIMANT: | Martin Dennett |
INSURER: | AAI Limited t/as AAMI |
MEMBER: | Elyse White |
DATE OF DECISION: | 28 September 2023 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; 56 year old pedestrian struck by insured motor vehicle whilst running along Military Road; insurer alleged claimant was running on the road but claimant denies this and states he was running on the footpath; insurer alleged in liability notice contributory negligence in the order of 30% pursuant to section 4.17 on the basis the claimant was running on the road in order to pass the insured vehicle and failed to take any adequate care for his own safety; Member not satisfied the evidence to date provided a basis for such an allegation; claimant also stated he believes he is entitled to damages for non-economic loss; however no assessment of his whole person impairment undertaken and the proposed settlement makes no allowance for non-economic loss, section 6.23 of the Act considered; Held – proposed settlement is rejected as member is not satisfied the settlement complies with the applicable requirements of the Act and the Guidelines. |
| DETERMINATIONS MADE: | CERTIFICATE The proposed settlement is not approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. The proposed settlement does not comply with cl 7.38 of the Motor Accident Guidelines 2017. |
STATEMENT OF REASONS
INTRODUCTION
Mr Martin Dennett (Mr Dennett), the claimant was involved in an accident on 14 March 2023. He sustained injuries and has received treatment for those injuries. He has made a claim for common law damages.
The insurer, AAMI admitted liability for the accident. The insurer alleges the claimant contributed to the accident.
Mr Dennett is anxious to resolve his claim for damages. He approached the insurer, and a proposed settlement sum has been agreed between Mr Dennett and the insurer.
Because Mr Dennett is not legally represented, his settlement must be approved in accordance with the Motor Accident Injuries Act 2017 (MAI Act).
The insurer lodged the application for approval of the settlement. This application was referred to me for consideration.
THE RELEVANT LAW
Section 6.23(2) and (3) of the MAI Act requires approval of the settlement and I am not to approve the settlement unless I am satisfied it complies with the requirements of the MAI Act or the Guidelines.
Clause 7.37 of the Guidelines states that I must be satisfied that the proposed settlement is just, fair and reasonable and within the range of likely potential damages that would be assessed by a member taking into account the nature and extent of the claim having regard to the claimant’s injuries, disabilities, impairments and losses sustained taking into consideration any deductions in the proposed settlement. Also, the claimant must understand the nature and effect of the settlement.
DOCUMENTS
I have considered the totality of the material contained in the insurer’s submission and attachments. These do not include any medical reports by medico-legal practitioner’s opinions for the purpose of the assessment of damages, or any assessments of whole person impairment.
I am not satisfied I have sufficient material to assess whether the proposed settlement is just, fair and reasonable.
REVIEW OF THE EVIDENCE
In the claim form completed by Mr Dennett, he advised the accident occurred on the footpath outside the exit to the Ampol Service Station on Military Road, Neutral Bay. He says he was running in a westerly direction. A vehicle, driven by the insured driver, was partially across the footpath. Mr Dennett says there was no room for him the run behind the vehicle. Mr Dennett says he observed traffic travelling along the road so ran in front of the vehicle and at the same time, the vehicle moved forward and hit him on the right side of this body sending him to the roadway.
He attended the emergency department at Royal North Shore Hospital.
The police report notes they did not attend the scene of the accident. The report is similar to the version given by Mr Dennett in the claim form.
The insurer, AAMI engaged an investigator to report on the circumstances of the accident. After interviewing the insured’s driver, the investigation report gives a different version of the events leading to the accident. He said his vehicle was partially on the roadway and stationary, when the claimant ran into the left side of his car.
There are a number of capacity/certificates of fitness reports in the material. These set out the claimant fitness to work and note ongoing symptoms and restrictions completed by Dr Zbaras Mr Dennett’s general practitioner.
A MRI of Mr Dennett’s right knee concludes “Antero-lateral tibial plateau mildly depressed subchondral fracture over an anteroposterior dimension of 18 mm with accompanying intense bone marrow oedema extending into the proximal tibial metaphysis. A tiny vertical fracture line is seen at the posterior extent of the smooth depression breaching the subchondral bone plate but does not extending into the overlying cartilage. No underlying meniscal tear. Mild joint effusion”.
Dr Zbaras referred Mr Dennett to orthopaedic specialist, Dr Matt Lyons. The doctor published a report dated 30 March 2023. He reviewed the MRI and concluded the diagnoses of a non-displaced tibial plateau fracture. He advised Mr Dennett to partial weight bear with crutches which was problematic due to an injury to his right shoulder. He recommended to Dr Zbaras that Mr Dennett should be referred to Dr Matt Sherlock for his shoulder injury.
Mr Dennett was referred for a MRI of his right shoulder which was undertaken on 3 April 2023. The results are reported as “1. Axillary pouch capsular thickening and oedema and mild pericapsular oedema, with paucity of fluid within the axillary pouch and disproportionate fluid distension of the biceps tendon sheath, suggesting the presence of an adhesive capsulitis. 2. Intact glenohumeral joint articular cartilage. 3. Small incomplete tear posterosuperior labrum. 4. Distal supraspinatus tendinosis and small articular surface partial thickness tear posteriorly, involving up to 30 percent tendon thickness, extending medio-laterally up to 6 mm and anteroposteriorly up to 4 mm. 5. Mild thickening subacromial-subdeltoid bursa. 6. Minor AC joint arthrosis”.
Although I can see from the material Dr Zbaras generated a referral letter to Dr Sherlock, there is no report from the doctor.
Mr Dennett underwent a number of physiotherapy treatments which I understand, is ongoing. He underwent an ultrasound guided right glenohumeral joint injection of 28 April 2023. He was also referred to psychologist, Aleksander Gisbert for treatment of acute stress reaction.
As part of his treatment program, the insurer engaged a rehabilitation provider. There are a number of reports from the provider which make mention of severely restricted standing and walking tolerances, problems kneeling, squatting, inability to drive, disrupted sleep amongst other complaints.
An Allied Health report makes mention of the accident causing physical injuries affecting his personal and work life. There is a further report he experienced depression and poor personal and professional functioning. He complained of feeling low and that his mood had changed dramatically since the accident with difficulties concentrating.
Mr Dennett is self-employed as a recruitment consultant with Fifth Executive. He told me he has been unable to return to his pre-accident duties, only carrying out light duties for a couple of hours a day. He also told me he can no longer hold face to face appointments with clients and is confined to duties “in the back office”.
THE PROPOSED SETTLEMENT
This is the second proposed settlement application lodged by the insurer. The first application was referred to Member Ford. On 23 August 2023, Member Ford rejected the application on grounds the proposed settlement did not comply with cl 7.38 of the Motor Accident Guidelines 2017. That proposed settlement amount was $60,000 for future economic loss plus deductions for statutory benefits in the sum of $58,357.13.
In response to Member Ford’s certificate, Mr Dennett approached the insurer to explore the possibility of a second application for a proposed settlement with an increased amount including a sum for non-economic loss.
The insurer has alleged a 30% contributory negligence on the claimant’s behalf. However, the insurer has made no deduction for contributory negligence in this proposed settlement. Likewise, there are no deductions for the statutory benefits paid to Mr Dennett.
This proposed settlement is made up of non-economic loss in the sum of $100,000. Mr Dennett does not wish to have this head of damage referred to the Commission for assessment of whole person impairment. The insurer acknowledges Mr Dennett may be entitled to damages for non-economic loss and makes the offer doing the best they can with the material available at this stage.
The past economic loss recognises Mr Dennett’s pre-accident weekly earnings were $3,402.75 based on his Business Activity Statements. The calculations are based on the certificates of capacity and his restrictions and current earnings. The amount the insurer has offered for past economic loss is the sum of $71,968.13. The proposed settlement includes this amount as the insurer’s summary in their submissions confirms the proposed settlement sum is plus Statutory benefits paid.
For future economic loss, the insurer has assessed a global buffer of $78.000 on the basis Mr Dennett’s accident-related injuries may cause a reduction in his future earning capacity.
The proposed settlement figure of $178,000 plus statutory benefits is the amount the insurer is seeking approval.
TELEPHONE CONFERENCE 13 SEPTEMBER 2023
Mr Dennett joined the telephone conference along with Ms Hill, the insurer’s legal representative on 13 September 2023. I indicated to Mr Dennett my concerns that there is insufficient medical evidence to determine the whole person impairment. He told me he has had bad experiences with doctors. He feels the insurer’s doctors have concluded there is nothing wrong with him. He did refer to the circumstances of the accident and disputed the insured’s driver’s version.
He confirmed he had been diagnosed with fractures caused by the accident. He told me he was training for the New York City Half Marathon when the insured’s driver hit him with his car. He said he had also planned to run in the Sydney Marathon which was to be held the Sunday following the telephone conference which he could not participate in.
He said this made him anxious and depressed. He told me “I have lost a lot and my life is not the same”. He has been told by doctors, there is no guarantee the impairment to his right shoulder will ever have a full range of motion.
He said since the accident, his business has been significantly impacted. Fortunately, he said his business partner has taken up his role seeing clients face to face which he performed before the accident.
He told me he has had advice from two personal injury firms and the proposed offer was within the range of damages assessed by both firms.
He told me “I just want to get on with my life…” and feels an unresolved claim will only exacerbate his emotional symptoms. He distrusts doctors.
I asked Ms Hill what the insurer’s position was. She confirmed Mr Dennett had approached them to further attempt to resolve his claim for damages. They only have the material attached to the application and based on this material, they had done their best to assess damages. In order to facilitate the process, the insurer makes no reduction for contributory negligence and makes no deduction from the proposed sum for the paid statutory benefits.
SHOULD I APPROVE THE SETTLEMENT
Although I am satisfied Mr Dennett is aware that the settlement finalises his entitlement to statutory benefits and the amount for non-economic loss is a final offer, I am not satisfied the amount is just, fair and reasonable based on the material presented to me by the insurer.
It may well be, after an assessment of whole person impairment is made, and a detailed assessment of Mr Dennett’s economic losses is concluded, together with a detailed report surrounding the inconsistences of the events of the accident, that the proposed settlement is just, fair and reasonable.
However based on what I have been presented with to consider if I should approve the settlement, I am not satisfied the amount of $178,000 plus statutory benefits paid to Mr Dennett is within the range of likely potential damages assessment if the claim was to proceed to assessment taking into account the nature and extent of the claim, the injuries, disabilities, impairments and losses sustained by Mr Dennett.
Further, I have had consideration to Mr Dennett’s mental health which I feel has not been fully addressed. He has clearly suffered a significant psychological injury which has affected his amenities of life, pain and suffering and enjoyment of life. It is understandable that this 56 year old man, who was running marathons before the accident, but now, as a result of accident-related injuries, he can no longer participate in these activities, has developed psychological symptoms which affect his enjoyment of life.
I reject the proposed settlement of this claim as I am satisfied the settlement does not comply with the applicable requirements of the MAI Act or the Guidelines.
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