AAI Limited t/as AAMI v Gunnulson
[2022] NSWPIC 657
•28 November 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | AAI Limited t/as AAMI v Gunnulson [2022] NSWPIC 657 |
| Claimant: | David Gunnulson |
| insurer: | AAI Limited t/as AAMI |
| Member: | Elizabeth Medland |
| DATE OF DECISION: | 28 November 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Approval of damages settlement pursuant to section 6.23 of the Motor Accident Injuries Act 2017; claimant is a now 57 year old male who suffered serious injuries, primarily relating to fractures of the left lower limb as a result of a motor accident occurring on 11 May 2019; claimant has been separately diagnosed with dementia after the accident; satisfied that motor accident did not contribute to such condition; claimant unable to continue working after the accident, however, dementia condition also incompatible with employment; claimant no longer able to walk long distances; Held – settlement of $400,000 approved, comprising $200,000 for non-economic loss, $90,000 for past economic loss and $110,000 for future economic loss; settlement of $150,000 for non-economic loss damages approved. |
| determinations made: | Certificate Issued under section 7.36(1) of the Motor Accident Injuries Act 2017 Assessment of Claim for Damages made in accordance with section 7.36 of the Act 1. The claimant and the insurer have agreed to settle the damages claim in the amount of $400,000. 2. The proposed settlement is approved for the purposes of s 6.23 of the Motor Accident Injuries Act 2017. |
Reasons for Decision
Issued under section 7.36(1) of the Motor Accident Injuries Act 2017
BACKGROUND
Mr David John Gunnulson (the claimant) is a 57-year-old male (born in 1965) who suffered serious injuries as a result of a motor vehicle accident which occurred on 11 May 2019.
The insured driver, driving a Holden Commodore, pulled out of the Horseland driveway on Windsor Road and failed to give way to the claimant, who was riding his motorcycle. A collision ensued between the claimant and the insured vehicle.
The claimant subsequently lodged an application for personal injury benefits with the insurer. I understand that liability was admitted and the claimant has been in receipt of statutory benefits.
On or about 9 January 2021, the claimant lodged an application for common law damages with the insurer. Liability was subsequently admitted by the insurer, by way of notice dated 23 September 2021.
The claimant is self-represented.
After gathering evidence, including requesting particulars from the claimant, the insurer made an offer of settlement on 20 September 2022 in the amount of $400,000 all inclusive. The breakdown of such offer being:
a. non-economic loss: $200,000
b. past economic loss: $90,000
c. future economic loss: $110,000.
It is apparent that the offer was discussed with the claimant over the phone before the emailed offer of settlement was made. The insurer quite appropriately pointed out to the claimant that Centrelink may make a deduction in the event of settlement.
By way of return email dated 20 September 2022, the claimant indicated that he had discussed the offer of settlement with his wife and he was “happy” to settle his claim in the amount of $400,000.
The insurer subsequently lodged an application with the Personal Injury Commission (Commission) seeking approval of the settlement.
The matter has been allocated to me as a member of the Commission.
I held a teleconference with the claimant and a representative of the insurer on 16 November 2022.
LEGISLATIVE FRAMEWORK
Section 6.23 of the Motor Accident Injuries Act 2017 (MAI Act) provides:
(1) “A claim for damages by an injured person cannot be settled within 2 years after the motor accident unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.
(2) A claim for damages cannot be settled unless—
(a) the claimant is represented in respect of the claim by an Australian legal practitioner, or
(b) the proposed settlement is approved by the Commission.
(3) The Commission is not to approve the settlement of a claim unless satisfied that the settlement complies with any applicable requirements of or made under this Act or the Motor Accident Guidelines.”
Clause 7.37 of the Motor Accident Guidelines (the Guidelines) provides:
“Under section 6.23(3) of the Act, before the Personal Injury Commission may approve the settlement of a claim for damages, it must be satisfied that:
(a)the proposed settlement satisfied the timing requirements in section 6.23(1) of the Act.
(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.”
DOCUMENTS CONSIDERED
I have considered the documents provided in the application. No reply has been received. The application is comprehensive, being more than 400 pages in length.
MEDICAL EVIDENCE
The NSW ambulance records note the claimant was laying on the road when officers arrived at the scene. The claimant apparently stated that once impacted he “spun out” on the bike and was thrown to the ground. He suffered a head strike with no loss of consciousness. His primary complaint related to his left leg, with fractures evident.
The claimant was transported via ambulance to Westmead Hospital. He was diagnosed with an open fracture dislocation of the left ankle and a complete avulsion of the anterior capsule from the tibial attachment.
Three days after the accident the claimant underwent a closed reduction of the fracture with external fixation for the “tib/fib.” The left ankle and medial foot wounds were debrided and an arthrotomy of the ankle joint was performed.
Approximately a week later, once swelling had subsided, the claimant was noted to have definitive internal rotation of the ankle. He was taken back to theatre to have the “ex-fix” removed. In addition, he had an open reduction and internal fixation of the distal tib/fib fracture and a reconstruction of the anterior capsule.
After three weeks in hospital, the claimant was discharged in a leg cast and underwent an 18-month rehabilitation program.
Before me are a number of reports from the claimant’s treating surgeon Dr Sutherson. The claimant attended on the doctor regularly, and repeat X-rays demonstrated good anatomical alignment of the ankle. By, 30 January 2020, the claimant was noted to have very minimal pain with the fractures and had made significant improvement. Dr Sutherson noted that he could safely discharge the claimant from his care, unless there were any ongoing concerns.
However, the claimant presented to Dr Sutherson again on 15 April 2021 with complaints of ongoing clicking on the anterolateral aspect of the ankle. The symptoms were noted to be suggestive of neuritis of the peroneal nerve. X-rays showed the fracture alignment to have healed very well. The claimant was shown nerve desensitisation exercises to reduce symptoms.
Medico-legal report of Dr Harrington dated 18 February 2022
The insurer obtained an opinion of orthopaedic surgeon, Dr Harrington.
Despite the ambulance records, the claimant advised Dr Harrington that he suffered a loss of consciousness after the accident.
The main complaint made to Dr Harrington involved the left ankle joint, having noticed that his leg is externally rotated and has a limp. The claimant noted that he can only walk on flat ground for 20 minutes and has pain around the ankle with a stiff joint. He is unable to climb a ladder and was not able to complete mowing the lawn when attempted.
In addition, the claimant noted ongoing left leg pain and is unable to sleep on his left hip and knee. He now walks with his leg externally rotated.
Dr Harrington noted the fracture as being united, however the claimant walks with his leg externally rotated. The doctor also noted a slight mal-alignment of the femur. In addition, significant wasting of the left quadriceps was noted. Dr Harrington went on to state: “even though he can concentrate and walk with his foot in the correct position for heel/toe, after about 4 or 5 steps it naturally goes into external rotation. Given the timeframe, this is now an ingrained gait pattern.”
Dr Harrington noted the claimant was unable to complete pre-accident home duties since the accident, and it is the doctor’s opinion that he will not be able to return to them at any point.
In respect of work capacity, Dr Harrington expressed his opinion that the claimant would not be able to return to his previous experience as a storeman or truck driver on account of his injuries. However, it is noted the claimant was not employed at the time of the accident. Dr Harrington noted that the claimant now sees himself as a retiree and “once someone has this outlook, it is very hard to change.”
He assessed the claimant as suffering from a whole person impairment of 20%.
Pre-existing medical issues
The evidence demonstrates that the claimant unfortunately suffers from significant and serious medical conditions that are unrelated to the accident.
Firstly, the claimant has suffered from significant pre-existing anxiety. Treating psychologist, Mr Simpson, in a report dated 30 August 2017 characterises the condition as “generalised anxiety disorder with panic and depression-like symptoms.” It was noted that the condition had deteriorated due to a number of stressors including starting a new job as a truck driver.
The evidence of Mr Simpson shows a further flare up of the anxiety condition when the claimant undertook a truck driving trial in August 2018. In this regard, the claimant’s general practitioner in a report dated 10 June 2019 stated: “given [the claimant’s] specific severe anxiety regarding heavy truck driving I recommend he permanently avoid this duty.”
Of even further concern in respect of the claimant’s health, is a recent diagnosis of frontotemporal lobe dementia and Alzheimer’s. Such diagnosis has been made by consultant neurologist, Dr Caruana. In her report dated 1 September 2021 the Dr Caruana noted the claimant’s medical history, including the subject motor accident. She notes a history of the claimant’s cognitive decline beginning 3-4 years prior and the doctor notes the neurological signs and cognitive testing to be highly abnormal.
Dr Caruana has recorded a history of the claimant and his wife noting the cognitive deline to be moderate to severe which affects almost all areas of cognition and daily living. Whilst still independent with dressing and personal hygiene, he has difficulty with most other errands. In addition, his temper has changed, he swears more often and has memory difficulties. It was noted that the described features are similar to those experienced by his brother who was diagnosed with frontotemporal lobe dementia at age 48 and has since died.
Under “diagnostic summary”, Dr Caruana states:
“Given the four-year history of cognitive decline, loss of interest, disinhibition, the cognitive testing and the imaging a diagnosis of frontotemporal lobe dementia with an Alzheimer’s component can be made.
A firm diagnosis is important so that David can move forward with planning of his remaining lifespan and that he can arrange for support.
As previously stated, his cognitive decline is not compatible with a return to work or return to drive.”
DAMAGES
Non-economic loss
The settlement proposal includes an allowance of $200,000 for non-economic loss.
There is no doubt, and indeed the insurer acknowledges it to be the case, that the claimant has suffered significant injuries as a result of the subject accident. In particular, the claimant has suffered significant injuries to his left lower limb and has suffered clear loss of physical capability as a result. He is no longer able to mow the lawn, and is unable to enjoy such activities as taking long walks, which he previously enjoyed.
It is also significant that the claimant has suffered psychological symptoms as a result of the accident, albeit on the background of longstanding anxiety disorder symptoms.
The claimant is a relatively young man at the age of 57 and on the median life expectancy tables has a 27 year life expectancy.
I have taken into account the unfortunate fact that the claimant has been recently diagnosed with dementia with an Alzheimer’s component, which clearly affects the claimant’s quality of life independent to his accident related injuries. Presumably also, such diagnosis could be expected to adversely affect the claimant’s life expectancy.
Noting the mention of the claimant losing consciousness after the accident, upon reading the material before me I was alerted to the possibility that the accident may have played some role, even minor, in respect of the claimant’s dementia diagnosis.
Whilst Dr Caruana notes the history of the accident, there is nothing in her report that suggests the accident contributed to the condition, although there was mention from the claimant’s wife that a decline after the accident was noted.
As such, I specifically raised this issue with the claimant during the teleconference. I note that the claimant was joined by his wife, Jody, who fully participated in the discussion. Both the claimant and his wife were very clear and adamant that the accident did not contribute to his condition of dementia and in this regard, I was advised that they had asked Dr Caruana specifically whether the accident could be blamed in any way. Both the claimant and his wife stated very clearly that Dr Caruana advised that the accident has “nothing to do with” the diagnosis.
In addition, I also note that whilst there is evidence of the claimant’s helmet being damaged in the accident, the claimant’s Glasgow Coma Score is recorded as having remained 15/15. He also did not undergo any investigations in respect of a brain injury at Westmead Hospital.
I am therefore satisfied that the subject accident has not contributed to the claimant’s diagnosis of dementia.
I consider the proposed allowance of $200,000 to be just, fair and reasonable. In addition, whilst perhaps on the lower range, I do consider the amount of $200,000 to be within the likely range that would be awarded if the matter were to be assessed by the Commission.
Past economic loss
The claimant was not employed at the time of the accident.
In the past, the claimant has worked as a truck driver and shelf stacker. His employment pursuits have been intermittent and interrupted with flare ups of his anxiety disorder. I note the claimant’s general practitioner, Dr Ng, noted the claimant to be unfit for commercial driving on 15 June 2017.
At the teleconference, the claimant’s wife confirmed the claimant was last employed around two months prior to the accident as a shelf stacker, but was not able to maintain the employment due to him “taking too long.” This was reportedly due to his anxiety disorder. This history is confirmed in the report of Dr Caruana.
In the 2019 financial year the claimant’s recorded taxable income from two employers is a total amount of $6,636. I note the accident occurred approximately two months prior to the end of such financial year.
In the 2018 financial year the claimant had a declared gross income of $30,376 derived from two employers.
The material before me also includes medical assessment for Centrelink purposes. Treating psychologist, Mr Simpson reported on 6 March 2018 that the claimant’s work capacity was temporarily reduced to 8-14 hours per week with a baseline capacity of 23-29 hours.
The insurer has made an allowance of $90,000 for past economic loss in their settlement proposal. This is noted to be assessed on the rough basis of an allowance of $30,000 per year over three years since the accident.
I consider the amount of $90,000 to be fair, just and reasonable. I consider it to be within the likely range that would be awarded if assessed by the Commission. Indeed, the amount is likely at the upper end of such range. I make this finding, noting the clear interruption of the claimant’s earning capacity from his pre-existing generalised anxiety disorder and his more recent dementia diagnosis. In addition, the allowance of $30,000 is above the net income derived by the claimant in the 2018 financial year that predates the subject accident.
Future economic loss
On the material before me, I am satisfied that it is very unlikely that the claimant will ever engage in employment again.
The reasons for such situation are somewhat complicated given the accident related injuries lay on a complicated picture of pre-existing and unrelated medical issues.
The evidence is clear that the claimant had difficulties prior to the accident maintaining employment, mainly on account of his anxiety disorder. However, I do consider it likely that but for the accident the claimant’s most likely future circumstances would have involved some intermittent employment on a part time or casual basis. Noting the medical evidence, such employment would have involved jobs such as shelf stacking as opposed to truck driving given the medical evidence that such pursuit was causing flare ups of his anxiety disorder.
Perhaps more significant, is the claimant’s diagnosis of frontotemporal lobe dementia with an Alzheimer’s component. In particular, I note Dr Caruana’s very clear opinion (in her report of 1 September 2021) that such diagnosis was incompatible with employment.
In making an allowance of $110,000 for future economic loss, the insurer notes the claimant has 10 years of working life remaining before retirement age. The insurer refers to the figure as a “global” buffer based on an allowance of $500 net per week over 5 years, less vicissitudes and plus 12% superannuation.
Given the above observations, I have no hesitation in concluding that the amount of $110,000 is just, fair and reasonable. I also consider such amount to be in the range likely to be awarded if the Commission had assessed the claim. Indeed, the amount is likely in the upper end of such range.
OTHER CONSIDERATIONS
The settlement complies with the relevant time considerations set out in s 6.23(1) of the MAI Act.
At the teleconference, I raised with the claimant that he was not represented and he had the right to seek legal advice and be represented by a legal practitioner. The claimant noted that he was apparently advised by the insurer at the beginning of his claim that he did not need a lawyer. This statement caused me some concern. I therefore made it very clear to the claimant that he was entitled to seek legal advice and engage representation from a legal practitioner. I repeated this fact to the claimant a number of times. At one point I note the claimant considered whether he should, however, he thereafter repeatedly told me very clearly that he did not wish to engage a lawyer and was very happy to accept the insurer’s offer and wanted the matter to be “over and done with” as soon as possible.
I am satisfied that the claimant understood his entitlement to legal representation and after considering such option, did not wish to take up such entitlement.
REASONS
I find the settlement amount to be fair and reasonable and within the range of likely potential damages assessments for the claim were the matter to be assessed by the Commission.
On the basis of the above, I approve the proposed settlement in the amount of $400,000 pursuant to s 6.23(3) of the MAI Act.
LEGISLATION
In making my decision I have considered the following legislation and guidelines:
· MAI Act;
· Motor Accident Injuries Regulation 2017, and
· Motor Accident Guidelines.
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