AAI Limited t/as AAMI v Lozanov
[2025] NSWPIC 31
•3 February 2025
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as AAMI v Lozanov [2025] NSWPIC 31 |
| CLAIMANT: | Victor Lozanov |
| INSURER: | AAMI |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 3 February 2025 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; settlement approval; $900,000 including non-economic loss, past and future economic losses; 68-year-old pedestrian; senior project officer; approved under section 6.23(2)(b); insurer conceded entitlement to non-economic loss; injuries included multiple fractures right leg, knee, ankle, toe, left ankle, right wrist and hand: soft tissue injuries to upper and lower back, shoulders, right arm, whiplash (neck) and psychological (PTSD); Held – settlement complies with clause 7.37 the Motor Accident Injuries Guidelines version 9.3. |
| DETERMINATIONS MADE: | CERTIFICATE Issued under s 6.23 of the Motor Accident Injuries Act 2017 1. The proposed settlement in the sum of $900,000 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
Victor Tom Lozanov (the claimant) was involved in a motor vehicle accident on 5 June 2021 when walking across the road at Westfield Shopping Centre at Hurstville and was struck by the insured.
He was taken by ambulance to St George Hospital where he was assessed for multiple injuries. He was subsequently transferred to Waratah Private Hospital where he remained until discharge in July 2021.
Police attended and report issued Event No. 80621040.
He lodged an application for personal injury benefits on 9 June 2021 and 1 July 2021 (documents A2).
The claimant is currently aged 68 and suffered from a number of medical conditions which pre-date the accident and these include;
(a) laminectomy in 2009;
(b) coronary artery stent inserted 2105;
(c) motor accident 2012;
(d) injuries motor accident 19 July 2017 - neck, shoulders, and thoracic pain;
(e) injuries motor accident 13 February 2019 – whiplash and back/lower back;
(f) lumbar laminectomy 2020;
(g) cervical fusion 2023;
(h) systemic hypertension, and
(i) hyperlipidaemia.
The claimant brought a common law claim for damages on 12 April 2023 (document A3).
The insurer accepted liability on 8 May 2023 (document A4).
The claimant was employed as an engineer/ senior project manager with Sydney Trains at the time of the accident and required time off as a consequence of his injuries. A claim has been made for past and future economic losses.
The insurer conceded the claimant is entitled to non-economic loss as his injuries exceed the statutory threshold of 10% whole person impairment. The offer made by the insurer and accepted by the claimant is $350,000 for this head of damage.
An adjournment of the application was made to enable the parties to investigate the claimant’s submission that he would have worked beyond the age of 70 years. This resulted in the insurer initially withdrawing the application to continue with further medical investigations.
The claimant subsequently approached the Personal Injury Commission (Commission) for the application to be re-instated with the withdrawal of any further future economic loss claim, beyond that initially agreed, which was to age 70 years.
The application before me is for the approval of the settlement as initially made.
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 or the Motor Accident Guidelines Version 9.3 which commenced on 6 December 2024.
Clause 7.37 of the Guidelines states I must be satisfied as to the following:
(a) the proposed settlement satisfies the timing requirements in s 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, and
(d) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
Preliminary conference held on 15 July 2024
Noting the claimant was a pedestrian who suffered significant injuries in the accident, he had undertaken some treatment and there are still other surgeries to be performed. The medical records and reports provided with the application were insufficient for me to make any assessment. Some more than two years old.
I requested up to date reports from treating specialists as well as the claimant’s general practitioner.
The claimant also advised he had seen a cardiologist, undertaken regular psychological treatment, pain management and ongoing rehabilitation. Up to date reports needed to be obtained from these practitioners.
Important to the assessment of non-economic loss is a statement from the claimant as to the impact of the motor accident, the injuries sustained upon him and their ongoing impact upon him to assess his pain and suffering. Also details of tasks and activities he was able to undertake before the accident and what he can or cannot do now.
Provision for the gathering of this information has been considered in the timetable for the next preliminary conference.
The claimant was made aware that should he wish to, he was even at this stage able to seek legal representation. It was not my role to advocate for him, but be satisfied in accordance with cl 7.37 of the Motor Accident Guidelines:
“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.”
Preliminary conference held on 30 September 2024
The claimant provided details of difficulties in drafting his statement and sought additional time to produce the information.
He confirmed he had approached legal practitioners to assist with his claim and when advised of the costs likely in the sum of $40,000, he preferred to manage his claim as a self-represented claimant. He did not think the results would provide an improved outcome for the costs incurred.
Issues relating to ongoing treatment and care were discussed with the claimant being advised to take these issues up with the insurer’s case officer.
Upon the final information being received, I would be in a position to assess the application before me.
Preliminary conference held on 19 November 2024
The claimant provided a statement as to the impact of his injuries and disabilities as requested by previous directions.
The insurer also uploaded records of Drs Kaplan, Anand, Sears and Szomor as well as clinical records of South Eastern Area Health (6 bundles).
I discussed with the parties my preliminary view that the amount agreed to for non-economic loss in my preliminary view was slightly on the low side noting the ongoing surgeries. Ultimately it was likely to depend on the additional materials received which would provide me further information of pain and suffering and loss of amenities of life.
I recalculated the past economic loss to update the sum to date and the sum from 157 weeks to 180.5 weeks. This came to $254,635.17. Fow v Wood component – income tax remained the same at $31,875.
There was a dispute between the parties as to future economic loss where the claimant was adamant he would but for the accident have worked to age 73 years and the insurer had made an allowance to 70 years relying upon an email from the claimant at page 1473 of the bundle where the claimant advised he would have worked a further three years from the date of accident where he was aged 67 years at the time.
The insurer sought some time to seek instructions. When the insurer returned to the conference instructions had been received to withdraw the current application before me.
The insurer uploaded a Notice of Discontinuance to the Commission’s portal.
With this action being taken by the insurer, there was no application before me to consider and the claimant and insurer will communicate with each other to ascertain whether a further settlement will be reached or an application for assessment of damages will be lodged in the Commission.
The claimant subsequently made a number of approaches via telephone and email to the case officers at the Commission staff seeking the application be reinstated. Upon the further information provided by the claimant that he was no longer claiming future economic loss beyond that agreed, the insurer was invited to relodge the application with the Commission.
Preliminary conference on 16 January 2025
The conference was conducted via video-link with the claimant and insurer present. The claimant confirmed that he wished for the application to proceed to assessment and withdrew any further claim for future economic loss beyond age 70 years. He also confirmed that he was unlikely to undertake further surgery and that he wanted the application finalised with the non-economic loss as agreed in the sum of $350,000.
The insurer confirmed that the previous amount for statutory benefits initially calculated at $236,076.09 has increased to $278,786.38 and would increase to $280,185.58 with the final payment of $1,399.20 to be paid on 25 January 2025. It was confirmed that the balance to be paid to the claimant from the $900,000 was $619,814.42 net.
The claimant reiterated his understanding of the nature and effect of entering into the settlement as had been discussed in detail in the earlier preliminary conferences held on
15 July 2024, 20 September 2024, and 19 November 2024 and that he was aware of its finality and the was aware he could still seek treatment and care separately.
The claimant confirmed he was fully cognizant of the implications of entering into the settlement. He was hoping to receive his funds as soon as possible as his statutory payments would cease after 25 January 2025.
The parties were then advised that I would determine the application on the information available to me.
The claimant and the insurer requested the settlement be approved.
DOCUMENTS CONSIDERED
I have regard to the following relevant documents contained in evidence bundle of 1509 pages in addition to the supplementary reports obtained.
Liability:
(a) application for statutory benefits dated 9 June 2021 and 1 July 2021;
(b) application for common law damages dated 12 April 2023;
(c) liability notice dated 8 May 2023;
(d) correspondence conceding 10% threshold for whole person impairment dated
21 March 2023;(e) submissions of the insurer dated 6 January 2025, and
(f) executed agreement of release dated 29 May 2024.
Medical records:
(a) ambulance report dated 2 September 2021;
(b) discharge Summary Waratah Private Hospital dated 21 October 2021;
(c) reports of Dr Martin Symes;
(d) clinical records of Dr Kim;
(e) reports Dr Cohen;
(f) Dr Zhang rehabilitation reports;
(g) Dr Rowden reports;
(h) Dr Karimi clinical records;
(i) Dr Szomor clinical records;
(j) Certificate of fitness - various;
(k) Rehabilitation records – Activities of Daily Living Report dated 8 May 2024;
(l) Exercise physiology clinical records;
(m) Physiotherapy clinical records, and
(n) Dr Kaplan records.
Financial records:
(a) pre-accident pay slips;
(b) post accident pay slips;
(c) income tax returns 2018 – 2022;
(d) Notices of Assessment 2018 – 2022;
(e) position role description, and
(f) list of insurer payments.
Settlement documents:
(a) deed of release dated 29 May 2024.
Claim
The claimant’s application for common law damages related to injuries sustained in the subject accident comprising the following:
(a) Fractures to:
(i)right leg;
(ii)right knee;
(iii)right ankle;
(iv)right toes;
(v)left ankle;
(vi)right wrist, and
(vii)right hand.
(b) Soft-tissue injury to:
(i)upper and lower back, and
(ii)both shoulder.
(c) Whiplash injury to neck.
(d) Psychological injury:
(i)post-traumatic stress disorder, and
(ii)anxiety.
Review of the medical information
The claimant suffers from a number of unrelated health issues which is taken into consideration when ascertaining the appropriateness of the quantum of damages having regard to his unrelated conditions, age and life expectancy.
The claimant suffered osteoarthritis in both knees in 2012 and 2103, coronary artery issues requiring a stent in 2015, chronic pins and needles in his legs in 2019, lumbar and cervical changes in 2019. Ischemic Heart Disease in 2015. Gastric erosion in 2017. He subsequently underwent an anterior decompression and fusion of his C/4 segment and relief of spinal cord compression with Dr Sears on 24 April 2023 – this was not accident related.
His physical mobility has been impacted by his injuries significantly initially post-accident where he was restricted in all activities. He has against a background of pre-existing degenerative changes the exacerbation of weight gain which has also resulted in chest discomfort not considered cardiac in nature, but musculo-skeletal.
He has since undertaking a cervical fusion in 2020 suffered atrial flutters which investigations have not revealed significant valve issues apart from “mild left atrial enlargement”. This condition is not related to the motor accident.
The Waratah Hospital discharge summary dated 21 October 2021 records an ability to walk 30m and ability to travers uneven ground. He was reported as “able to walk 200metres in a hydrotherapy pool, step ups and leg squats. Recovery - noted with ongoing goals to include gait improvement.”
The records of rehabilitation and ultimately surgery for left knee replacement indicate the extent of damage and the difficulties in mobility post-accident. He undertook a total left knee replacement on 5 December 2022 performed by Dr Rowden. In report dated
14 February 2023 to his doctor Dr Karimi, the specialist confirmed:
“He has improved with rehabilitation and hydrotherapy. He has recently had access toa cold compression device “Game Ready” which is also helping”. He has much less swelling than previously full extension and flex to nearly 110 degrees.” (bundle page 751).
When providing a report to the insurer dated 29 November 2022, he opined “the motor accident aggravated a pre-existing bilateral advanced osteoarthritis”. He also opined that “the claimant would likely experience similar symptoms at or about the same age of life irrespective of the motor vehicle accident. The marked valgus alignment of the left knee with significant subluxation was highly likely to have been present prior to the injury of 5/6/21, These changes were longstanding.” He concluded the same for the right knee showed “advanced osteoarthritis with neural alignment and advanced patellofemoral joint osteoarthritis. It is likely the right knee would have had similar symptoms irrespective of the motor vehicle accident.” (bundle page 676).
He was an inpatient and then outpatient undertaking rehabilitation at Sydney Private Hospital.
Exercise physiology commenced on 7 March 2023. In report of David Elvish independent physiotherapy consultant dated 18 June 2024, he considered a “transition now to independent self-management” the preferred ongoing treatment. Ongoing hydrotherapy and duplication of intervention provided by Lifefit physiotherapy was no longer supported as it did not provide “any progression of capacity or tolerances” and was considered a “significant risk of undermining greater utilisation of evidence based guidelines for the management of persisting musculo-skeletal pain”.
Associate Professor Szomor noted in his report of 13 May 2024:
“Progress ..continues to struggle with multiple musculoskeletal symptoms. He continues with hydrotherapy and physiotherapy which he finds helpful. He uses a roller frame for mobilising outside and walking stick inside, Hand and right wrist is stiff, selling and pain, Recovering from left knee replacement and right arthritic knee causes pain stiffness, crepitus and a limp.” (bundle page p1042).
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 recommended the proposed settlement figure of $900,000 be approved.
The claimant also confirmed his desire that the settlement be approved by me.
Review of the evidence
I am satisfied the claimant sustained significant injuries in the motor vehicle accident and has made some recovery but is plagued with ongoing musculoskeletal issues.
The medical information provided in this matter accord with the history of the injury and various treatments to date. The application provided extensive records some 1590 pages and a further bundles of current records 200 pages in six bundles.
He attended upon Dr Symes for left ankle injuries, Dr Zoltan Szomar for his knees, Dr Neville Rowden for left knee replacement, with right to follow and Dr Raz Anand consultant physician for pain medicine, Dr Zhang for rehabilitation and Dr Ke-Hwan Kim his general practitioner for ongoing management. The insurer has approved further surgery which includes a right total knee replacement and right wrist.
When making an assessment of whether the amount of damages agreed to in relation to the claim for non-economic loss should be approved, I have regard to the pain and suffering the claimant endured as a result of his injuries, the operations he undertook and the possibility of a further knee replacement to his right knee and a possibility of right wrist surgery. The claimant has indicated he would prefer not to undergo further operations at this point whilst still recovering from the previous surgery.
He is currently aged 68 years with a further life expectancy of 18.62 years (Furzer Crestani 2024 Medium Life Expectancy tables).
The claimant has pre-existing conditions which to some extent have also necessitated surgery, his records indicate the osteoarthritic changes and degenerate changes were present in his cervical spine requiring treatment before the subject accident.
The extensive medical information before me is sufficient for me to determine the application before me. I note the claimant continues to have difficulty with mobility using various disability aids, pain causing sleepless nights and continues with regular rehabilitation.
ECONOMIC LOSS
PAST ECONOMIC LOSS
The claimant was employed at the date of the accident as a senior project officer with Sydney Trains. His tax returns and payslips were used to calculate his average weekly earnings of $1,270.92 net with losses to date of offer amounting to 157 weeks plus 11% superannuation amounting to $221,483.22.
Tax paid on the period amounted to $31,875.
Total past economic loss was agreed in the sum of $253,359.09.
FUTURE ECONOMIC LOSS
The claimant is unable to return to work due to his injuries. It is agreed between the parties that the claimant would work to age 70 year but for the accident. He remains certified as unfit for work.
Total incapacity has been allowed to age 70 years at the rate of $168 net weekly.
Calculations of loss was $1,686 x145.6 -15% = $208,659.36 plus superannuation. This amounted to losses of $237,871.67. In addition to this sum it was accepted that the claimant may have undertaken some overtime from time to time and a further buffer of $58,769.24 inclusive of superannuation was allowed. This accords with the history provided by the claimant and the average weekly earning capacity for the period provided in primary tax materials of 2018-2022.
The quantification of economic loss accords with the history provided by the claimant and the evidence of earning capacity.
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 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 or the Motor Accident Guidelines version 9.3.
I am satisfied that there has been compliance with the Act and the Guidelines.
(b) The insurer has included 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 non-economic loss agreed to in the settlement is $350,000. The amount for past economic loss $253,359.09. The amount for future economic loss $296,640.91 including the buffer for overtime.
(ii)The amount of any deductions in the proposed settlement.
The insurer has made statutory payments to date in the sum of $280,185.58. This sum included a final payment of $1,399.20 on
25 January 2025. The payments will be deducted from the proceeds of settlement as the insurer is credited payments already made. The claimant will receive net proceeds of $619,814.42.(iii)The amount of any advanced payments made be specified. There had not been any advanced payments.
(iv)Requires the evidence, documents and materials relevant to an assessment of the proposed settlement figure.
I have reviewed the evidence relied upon the included extensive medical records as contained in the application containing 1590 pages of information which included the ambulance and hospital records and reports of Drs Cohen, Zhang, Rowden, Karimi,Szomor, Kim and Symes. The further six bundles of current treating records also provided at my request. The information produced by the insurer has given me a good indication of the injuries sustained, the treatment received the pain and suffering and loss of amenity suffered and likely to be suffed by the claimant for the remainder of his life. I note the claimant’s condition has stabilised some what and his ongoing problems continue with some improvement with ongoing physiotherapy, hydrotherapy and counselling.
(c) Clause 7.37 of the Guidelines, requires me to consider the following:
(a)The preposed settlement satisfies the timing requirements in s 6.23(1) of the Act. (now 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 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 evidence produced in this matter, I am satisfied that the amount allowed for non-economic loss agreed upon in the sum of $350,00 whilst on the lower side of range is just, fair and reasonable and within the likely range of damages were it to have been assessed by a Member of the Commission having regard to the injuries sustained, the level of recovery and the age of the claimant, and the amounts calculated for economic losses accord with the most likely circumstances but for the accident, evidenced by records of loss and primary documents including payslips.
(c)The claimant understands they are entitled to be represented in respect of the claim by an Australian legal practitioner.
The claimant confirmed to me he was aware he could seek legal advice and has chosen not to.
(d)The claimant understands the nature and effect of the proposed settlement and willing to accept the proposed settlement.
The claimant was made aware in the video preliminary conferences that in the event he took the settlement, he could not seek any further damages. He was aware he is able to continue to receive assistance with treatment and care.
I am satisfied that the claimant was aware of his 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 $900,000 is just, fair and reasonable and within the range of likely potential damages assessments if the claim was to proceed to assessment by the Commission taking into account the nature and extent of the claim and losses sustained by the claimant.
I am satisfied the claimant was aware he could seek legal advice and chose not to retain legal representation.
I am satisfied the claimant understands the binding nature of the settlement and that he 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 his decision to accept it was of his own volition.
I am satisfied the claimant is aware that $280,185.58 will be deducted from the proceeds of settlement and that he will receive $619,814.42.
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 $900,000.
The proposed settlement complies with cl 7.37 of the Motor Accident 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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