AAI Limited t/as AAMI v Saez
[2023] NSWPIC 591
•8 November 2023
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as AAMI v Saez [2023] NSWPIC 591 |
| CLAIMANT: | Hernan Saez |
| INSURER: | AAI Limited t/as AAMI |
| MEMBER: | Elyse White |
| DATE OF DECISION: | 8 November 2023 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; section 6.23; settlement approval; 59-year-old claimant was riding his bicycle in the Byron Bay region when the insured driver collided with the bike hurling the claimant onto the roadway causing fractures to his right clavicle, left fibula, right rotator cuff injury and post-traumatic stress disorder; whole person impairment assessed by the insurer’s psychiatrist at 17%; claimant working as a cleaner certified unfit for work for 73 weeks; thereafter certified fit for volunteer work for up to 10 hours per fortnight; insurer paid statutory benefits in the sum of $23,682.16; proposed settlement included calculated amounts for past and future economic loss plus superannuation and a Fox v Wood component totalling $182,343; non-economic loss proposed in the sum of $250,000; settlement proposal rounded up to $435,000; Held – settlement within the range of potential damages assessment if the claim was to proceed to assessment; settlement just, fair and reasonable; settlement approved. |
| DETERMINATIONS MADE: | CERTIFICATE Issued under s6.23 of the Motor Accident Injuries Act 2017; The proposed settlement is approved under s6.23(2)(b) of the Motor Accident Injuries Act 2017 in the sum of $435,000 |
STATEMENT OF REASONS
INTRODUCTION
The claimant Mr Hernan Saez was involved in a motor vehicle accident on 18 April 2019. He was riding his bicycle in the Byron area when the insured driver collided with his bike.
He was conveyed by ambulance to Byron Central Hospital where he was admitted for one week before discharge into the care of his general practitioner and psychologist.
Mr Saez has made a claim against AAI Limited t/as AAMI (the insurer), the insurer at fault for lump sum damages.
The insurer has wholly admitted liability for the claim for common law damages.
The insurer has accepted that Mr Saez is entitled to damages for non-economic loss, economic loss and is entitled to payment of reasonable treatment and care for the rest of his life for his accident-related injuries.
Mr Saez and the insurer have reached agreement as to settlement of the claim for damages.
Because Mr Saez is not legally represented, his settlement must be approved in accordance with the Motor Accident Injuries Act 2017 (the Act).
The insurer lodged the application for approval of the settlement and this application was referred to me for consideration.
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 I must be satisfied 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 a claims assessor, taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by Mr Saez and taking into account any proposed reductions or deductions in the proposed settlement.
I also must be satisfied Mr Saez understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
DOCUMENTS CONSIDERED
I have considered the insurer’s submissions, Mr Saez’s application for personal injury benefits, his treating medical records including fitness certificates, hospital clinical notes, reports, rehabilitation assessments and communications between Mr Saez and the insurer.
REVIEW OF THE EVIDENCE
Mr Saez is a 60 year old house-keeper cleaner for Crystal Cape Pty Ltd stationed in the Byron Bay area.
Following the accident, Mr Saez was transported by ambulance to the Byron Hospital. He was diagnosed with a fractured right clavicle and left fibula, a right shoulder rotator cuff injury and he developed severe depression and a post-traumatic stress disorder. He came under the care of Dr Binns his general practitioner and his psychologist Ms Jane Enter. She treated him for debilitating anxiety and insomnia. After a deterioration, Ms Enter treated Mr Saez with EMDR therapy. As Dr Binns is no longer practicing in the area, Mr Saez now sees Dr Giselle Hull.
The insurer arranged for Mr Saez to be examined by Dr George for a medico legal psychiatrist assessment. The doctor diagnosed Mr Saez with a chronic post-traumatic stress disorder with mild to moderate depression. He assessed whole person impairment at 17%.
The insurer further arranged for Mr Saez to be examined by occupational physician Dr Rosenthal. The doctor noted Mr Saez sustained a fractured right clavicle with soft tissue injury to his right shoulder and a proximal left fibula fracture, now healed. He assessed whole person impairment at 3%.
THE PROPOSED SETTLEMENT
The insurer calculated the offer of settlement in the sum of $400,000. The claimant has received statutory benefits in the sum of $23,682.16 paid for by the insurer. The insurer will be entitled to receive credit for the sum of $23,682.16 out of the settlement sum.
The insurer conceded Mr Saez was entitled to damages for non-economic loss based on the assessment by their Dr George. They submitted $250,000 was an appropriate sum for this head of damage.
Past economic loss was calculated on Mr Saez’s taxation return which translates to $400 net per week. From the date of the accident to 10 September 2020 he was certified unfit for duties which amounts to 73 weeks at $400 which equals $29,200. From thereon he was certified fit for 10-20 hours per fortnight. The insurer calculated his residual loss as $300 per week for 141 weeks which amounted to an additional sum of $43,200 which gives a total of $79,365 less the amounts paid for statutory benefits.
The Fox v Wood component amounts to $5156.
In the future, the insurer allowed $200 net per week for 8 years less 15% for vicissitudes which amounted to $65,214.
TELEPHONE CONFERENCE
A telephone conference was held with Mr Saez on 24 October 2023. There was no appearance on behalf of the insurer. I had intended to ask the insurer why the amount for future economic loss was randomly reduced from a loss of $300 per week to $200 with no supporting evidence for this reduction.
I asked Mr Saez about the discrepancy between the amount for past and future weekly loss. He had no explanation for the reduction. I enquired if he was happy with the settlement amount and he replied he would have been happy if the offer included the $300 net per week into the future.
He advised he was aware of his right to legal representation. He confirmed he did not wish to retain a lawyer. He understood that if approved, his claim for damages would be final apart from his entitlement to reasonable treatment for accident caused injuries for the rest of his life. He agreed that the insurer was entitled to a refund for the statutory benefits for past loss of wages in the sum of $23,682.16.
I issued a report of the preliminary conference which included an invitation to the insurer to reassess the weekly amount for future economic loss. I received a reply via the portal and a subsequent amended Agreement of Release dated 27 October 2023 with an increased amount for future economic loss from $65,214 to $97,822. This increase brings the final proposed settlement sum to $435,000.
SHOULD I APPROVE THE SETTLEMENT
Section 1.4 of the MAI Act defines non-economic loss as; pain and suffering; loss of amenities of life; loss of expectation of life; and disfigurement. The current maximum payable for non-economic loss is indexed at $620,000.
I am satisfied, having regard to Mr Saez’s age, the nature and extent of his injuries which have not all resolved and the loss of amenities of life and pain and suffering, the amount proposed by the insurer of $250,000 is a fair and reasonable sum for non-economic loss.
I am satisfied the amount proposed for past economic loss, Fox v Wood and the revised amount for future economic loss is just, fair and reasonable.
I am satisfied Mr Saez is aware of his right to seek legal advice but does not wish to do so.
I am satisfied Mr Saez understands the binding nature of the settlement and that he will be precluded from making a further claim for damages arising out of the settlement. I am further satisfied Mr Saez is now happy and willing to accept the increased proposed settlement. I take this opportunity to commend the insurer for their sensible and pragmatic approach to my concerns about the calculation of future loss of earnings.
Overall, I am satisfied the proposed settlement is just, fair and reasonable and 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 Saez.
Accordingly, pursuant to s.6.23(2)(b) of the MAI Act I approve the settlement of $435,000 in respect of Mr Saez’s claim for damages. The insurer is to receive a credit for the paid statutory benefits in the sum of $23,682.16.
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