AAI Limited t/as GIO v Benbow
[2024] NSWPIC 121
•13 March 2024
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as GIO v Benbow [2024] NSWPIC 121 |
| CLAIMANT: | Gregory Benbow |
| INSURER: | GIO |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 13 March 2024 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; settlement approval in the sum of $950,000; 49-year-old male farrier by occupation; entitlement to non-economic loss agreed sum $325,000; fracture to thoracic T3-5 now healed; ongoing cervical spine pain; past economic loss is $155,000 and buffer for lost opportunity is $70,000; future economic loss; weekly loss $700.00 ongoing; Held – proposed settlement is just, fair and reasonable; settlement approved under section 6.23(2)(b). |
| DETERMINATIONS MADE: | CERTIFICATE Settlement approval 1. The proposed settlement is in the sum of $950,000 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 Guidelines. |
STATEMENT OF REASONS
INTRODUCTION
On 16 July 2019, Gregory Benbow (the claimant) was driving his car when it was struck by the insured’s vehicle striking the back left of vehicle causing it to roll onto its roof at the intersection of Tocal Road and Largs Road at Bolwarra. He was transported to the John Hunter Hospital via ambulance.
The injuries sustained in this accident were:
· thoracic compression fractures T3 – 25%;
· thoracic compression T4-T5 – 20%;
· right pneumothorax, and
· cervical spine – soft tissue facet joint inflammation and aggravation of pre-existing degenerative changes.
Whole person impairment was assessed by Dr Rosenthal at the request of the insurer and in his report dated 14 December 2022 Dr Rosenthal assessed whole person impairment at 24%.
The claimant continued under the care of his general practitioner Dr Usman and spinal specialist Dr Abson.
On 18 July 2019 an application for statutory benefits was made.
On 1 July 2022 a common law claim form was lodged with the insurer and the insurer admitted liability on 11 October 2022.
The insurer conceded that the permanent impairment exceeded the statutory threshold under cover of letter dated 24 April 2023. The claimant is therefore entitled to damages for non-economic loss and the insurer has made provision for this in the settlement.
The injuries sustained in the accident have impacted on the claimant’s earning capacity as a farrier and he brings a claim for both past and future economic loss.
As the claimant is not represented by a lawyer, the settlement must be approved in accordance with the Motor Accident Injuries Act 2017 (MAI Act) and relevant Guidelines.
JURISDICTION OF THE PERSONAL INJURY COMMISSION
The Personal Injury Commission (Commission) was established on 1 March 2021.
I am a Member of the Motor Accidents Division of the Commission authorised to determine the application.
THE RELEVANT LAW
Under ss 6.23(2) and (3) of the MAI Act before the Commission may approve the settlement of a claim for damages, it must be satisfied that:
“The proposed settlement complies with any of the requirements of the MAI Act or the Motor Accident Guidelines.”
Clause 7.37 of the Guidelines states I must be satisfied as to the following:
“• 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;
· the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner, and
· the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.”
Preliminary conference on 28 June 2023.
The insurer lodged the application for approval of the settlement, and it was referred to me for consideration. I held the first preliminary conference on 28 June 2023. The claimant appeared by video-link. The claimant participated in person and the insurer was represented by Adrianna Papaspiros.
The settlement reached at this stage, amounted to $570,074.82 broken down as:
· non economic loss – $275,000;
· past economic loss – $95,074.82, and
· future economic loss – $200,000.
The claimant was asked to confirm his injuries and he advised that he considered his injuries were being aggravated by his work tasks and he felt that his condition had deteriorated. I advised the parties on this occasion that I required additional information on the claimant’s prognosis.
I requested that the insurer obtain current clinical records and the claimant to attend his general practitioner to ascertain the impact of his ongoing injuries on his future earning capacity. I also sought details of likely future treatment as this addressed pain and suffering into the future and was relevant to both non-economic loss and future economic loss.
The claimant was requested to provide me with an impact statement to enable me to gather relevant information as to the impact of his injuries, his pain and suffering both past and present and details of any other impact to his ability to undertake activities of daily life.
Preliminary conference 28 September 2023
The claimant produced an impact statement and the insurer the additional medical reports and clinical records requested on the earlier occasion.
The discussion followed wherein the insurer indicated that on the new information the settlement offer would be increased to $700,000.
The insurer produced a recent MRI of the claimant’s spine. The claimant reiterated his concern about remaining in the workforce at the hours currently worked. His pain levels were being aggravated by the hours worked. The claimant felt there was further deterioration and the heavy nature of the role of a farrier was causing him additional pain. He was unsure how long he could continue to work at the hours he was undertaking.
After further discussions with the parties, it was decided that an occupational therapist would be retained to address the claimant’s concerns as to the impact of his ongoing injuries on his future earning capacity. The insurer retained Earning Capacity Assessments to provide a report.
The matter was adjourned to enable the report to be commissioned.
Preliminary conference 8 December 2023
I was informed that the claimant had attended the vocational assessment and that the report would not be available until late December 2023 or early in the new year.
On this occasion, the claimant again advised he considered that he could barely work six hours each day and reported he required days off to rest and recuperate. He had now been prescribed Amitriptyline for broken sleep.
A further nerve block had been arranged by his treating specialist and the matter was adjourned to enable the treatment to be undertaken and the effects of this treatment verified. The parties were also encouraged to continue negotiations in the light of the recently updated reports of Dr Usman and Dr Abson.
The claimant sought additional time to enable his condition to stabilise and a further teleconference was scheduled for 20 February 2024.
Preliminary conference 20 February 2024
The insurer uploaded to the commission portal an updated settlement offer in the sum of $950,000 dated 19 February 2024. This represented the following:
· non economic loss – $325,000
· past economic loss – $155,000, and
· future economic loss – $470,000.
The claimant had not had the opportunity to consider this updated offer by the time the conference took place.
A discussion took place with the claimant as to the nature and effect of a settlement, his ability to seek legal advice on the settlement at this stage and if he wished to defer the conference to a later date this could be implemented to enable him to seek advice if he chose to and to consider his position.
The matter was stood over to 26 February 2024 to enable the claimant to consider his position. The claimant considered this sufficient time for him to consider the offer.
26 February 2024
At this preliminary conference the claimant advised that he had considered the offer and was “very happy with the increase in the settlement sum”. He relayed that his recent treatment had resulted in some improvement physically. Together with the reduced hours to six daily he had stabilised his pain levels.
He confirmed he understood that whilst settlement sum was $950,000 the net amount he would receive after the deduction for statutory payments made would be ($950,000 - $88,324.82) in the sum of $861,675.89.
The claimant was asked if he would like additional time to seek legal advice and he responded with “I’m fine with the settlement proceeding”.
I was informed that the claimant did not wish to seek and further investigations medical or legal. He wanted the matter to be determined on the available information.
I asked the claimant if he understood the nature of the amended settlement terms and its finality and if it was being undertaken of his own free will. He responded to me:
“Yes, I understand the settlement is final except for treatment ongoing”.
The insurer was also asked if any further information or statement was to be made and
Ms Papaspiros said: “we will update and execute the documents and forward a copy to the commission”.The preliminary conference concluded with me advising the parties that I would upon the receipt of the updated settlement offer, executed acceptance submissions determine the matter.
Directions were issued on this occasion that the parties were to upload the fresh settlement documents no later than 12 March 2024.
The insurer uploaded the amended settlement documents including executed deed of release on 6 March 2024.
Amended terms of settlement dated 27 February 2024
The terms were uploaded to the commission portal on 12 March 2024. The parties have reached agreement to settle the claim in the sum of $950,000.
DOCUMENTS CONSIDERED
I had regard to the following relevant documents contained in evidence bundle which included the following:
· Liability:
application for statutory benefits dated 18 July 2019;
application for common law damages – document A12;
permanent impairment letter dated 24 April 2023;
liability notice dated 11 October 2023;
police report E71379504 dated 2 October 2019 – document A11, and
particulars – document A15.
· Treating medical records:
Dr Mohyuddin – clinical records;
Dr Mohyuddin report dated 18 September 2023;
Dr Abson – spinal surgeon - various
Certificates of Fitness – various – document A3;
MRIs cervical spine – document A4;
physiotherapy records – document A5;
IPAR Rehabilitation Pty Limited records – documents A7-A9, and
John Hunter Hospital records – document A6.
· Investigations
Vocational assessment – Earning Capacity Assessment - dated 3 January 2024.
· Economic loss material:
tax returns and business activity statements – document A19.
· Settlement documents:
initial settlement agreement and release – documents A16-18;
amended settlement agreement dated 19 February 2024, and
executed deed of agreement dated 26 February 2024.
REVIEW OF THE EVIDENCE
Statement of the claimant
The claimant’s statement illustrated the pain and suffering he has endured as a consequence of the injuries sustained in the accident. He reported the following;
“Prior to 16 July 2019 I had a business that had the potential for growth. Growth of the business was achievable due to my physical fitness being able to withstand the demands of my work. I experienced no pain previously and had no health issues before the motor vehicle accident. My business as a farrier heavily relies on my physical fitness as it involves handling horses, bending and lifting for long periods of time. Post the car accident on 16th July 2019 I suffered serious injuries including compression fractures T3-T5, right apical pneumothorax, -25% loss of vertebral body height T3, <20% loss vertebral body height T4 and T 5, my wife and children also sustained injury that day affecting us all emotionally and physically. I had a prolonged period off work due to the accident resulting in future economic loss of my business and household income. I was and continue to be the sole dominant household income provider, the situation left me stressed and impacted my relationship. I continue to suffer ongoing physical pain from my injuries and I predict it to be lifelong as a result of the motor vehicle accident. After the motor vehicle accident I lost a number of clients due to my long absence from my work duties from which were never recovered. My business growth potential was not achievable after the accident. My long standing neck pain has caused emotional impacts on family relationships including the economic stress regarding my future earning capacity and the concern of how long I can endure such pain until retirement. My neck pain is debilitating, as I’m only able to sustain my workload with regular pain relief and physiotherapist appointments of which I have to allow for in my work schedule. I have not been able to increase my workload since the accident. I suffer sleep disturbances since the accident waking often as I find it difficult to lay in a comfortable position due to the neck pain. Lifting and doing regular chores and maintenance around the house has been impacted, I’m regularly unable to complete chores because of the onset of pain. Overall the impact the accident has had on my work and relationships has been life changing as I feel the uncertainty of my future with ongoing physical injury and economic earnings is questionable “
INJURIES
The clinical records produced in the matter confirm that the claimant initially sustained the following injuries:
· thoracic compression fractures T3 – 25%;
· thoracic compression T4-T5 – 20%;
· right pneumothorax, and
· cervical spine – soft tissue.
The clinical records of Dr Mohyuddin evidence the progress of conservative treatment, regular physiotherapy and the rehabilitation undertaken to date. He was required to strengthen the musculature surrounding his thoracic spinal column.
The rehabilitation records establish the restrictions on duties and activities and the progress from restriction of any capacity to work to a return to five days a week. His role as a farrier involves heavy lifting at times and manoeuvring horses. He is fit to undertake these tasks but on a limited capacity.
I accept the evidence of the claimant that he is in less pain when he restricts his work hours to six hours a day.
Dr Abson, treating spinal surgeon in his latest report dated 25 October 2023 noted:
“ I am seeing Greg nearly four years since his initial consultation for a work injury. Unfortunately Greg continues to have predominately left sided axial neck pain. He does occasionally get intermittent paraesthesias in the arm due to position but no permanent radicular symptoms or neural compressive symptoms. He is managing his pain with Nurofen/Voltaren occasionally as well as some Panadol. He has managed to get back to full time work all day with reduced hours”.
There is additional medical support for the restriction of his hours in the reports of Drs Mohyuddin and Rosenthal qualified by the insurer.
The clinical notes of exercise physiologists confirmed that the claimant was discharged from treatment on 29 April 2022.
Having reviewed the medical evidence, I am satisfied that the claimant‘s permanent impairment assessed entitles him to damages for non economic loss.
NON ECONOMIC LOSS
The insurer relied upon the assessment of Dr Rosenthall who assessed whole person impairment at 24%.
Whilst the insurer offered the sum of $275,000 in its first offer, this was increased to $325,000 by the conclusion of the preliminary conferences.
The claimant sustained injury to his thoracic spine which is no longer showing ongoing symptoms. The soft-tissue injury to his neck is problematic and this is restricting his ability to undertake work tasks and activities of daily living.
The claimant has worked hard to improve his recovery to his credit he has undertaken all prescribed treatment and tasks to mitigate his loss. He still requires regular physiotherapy and the ingestion of over the counter pain relieving medication to manage his ongoing symptoms of neck pain.
The parties have agreed on the sum of $325,000.
I consider upon the review of the medical information before me and the information provided by the claimant in his reported histories, oral evidence and statement that whilst he continues to suffer ongoing neck pain and it is likely to be life-long. The sum agreed for non-economic loss is just fair and reasonable and within the likely potential damages assessment 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.
ECONOMIC LOSS
Past economic loss
The claimant was working as a farrier in his own business. He was unable to work for the first six weeks post-accident and the insurer allowed the sum of $1,200 for the first six weeks. For this period the loss was calculated in the sum of $7,200.
The next period was when the claimant returned to work on reduced hours and an allowance was made for the sum of $800 per week for the next 24 weeks. For this period the loss was calculated in the sum of $19,200.
The claimant’s injuries further impacted on his ability to undertake work. He estimated his ongoing loss for the next 210 weeks as $600 loss weekly. This amounted to a loss of $126,000.
The Fox v Wood (1981)148 CLR 438 component (income tax paid) was estimated at $2,511. There is no superannuation loss as the claimant was self-employed and did not make contributions to superannuation.
The total for past economic loss equated to $154,911 and the insurer rounded this to $155,000.
I am satisfied that the losses have been calculated based upon primary records of the claimant to establish the losses claimed.
I am satisfied that the losses have been incurred.
Future economic loss
Whilst the claimant continues to operate his farrier business. A consequence of his ongoing neck pain is a reduction in his future earning capacity as he continues to suffer ongoing pain and his work related tasks impact on his injuries. He is now working reduced hours approximately 6 hours a day and he is likely to remain impacted for the remainder of his working life. His ongoing loss is estimated as $700 weekly net.
The claimant also provided information to the insurer of a lost business opportunity where the claimant but for the accident would have undertaken further work as a farrier but was unable to take on this additional work offered due to his injuries preventing him from working to the capacity he held pre-accident. An allowance was made as a buffer in the sum of $70,000 for this loss of business opportunity.
The insurer relied upon the opinion of Dr Rosenthal who opined that the claimant earnings capacity is restricted to “two-third of his pre-accident hours”. The vocational assessment undertaken confirmed the claimant held a residual ability to undertake his pre-accident tasks but the heavier tasks would be problematic.
The loss was calculated as $700 x 666.4 (5% multiplier for 20 years) less 15% for vicissitudes which amounted to $396,508.
Total loss amounted to $466,508 which was rounded up to $470,000.
The sum agreed to accords with the losses claimed by the claimant that he cannot work more than 6 hours daily and often requires a break to rest to enable his symptoms to decrease.
The most likely circumstances but for the accident have been applied in this calculation that the claimant would work to retirement in his business as a farrier. This is supported by the information provided in the matter.
SHOULD I APPROVE THE SETTLEMENT
I am satisfied that the amounts allocated in the settlement for past economic loss accord with the evidence provided by the claimant as to his business enterprise and his weekly earning capacity. I am satisfied that the amount allowed for future economic loss including the additional buffer accords with the most likely circumstances but for the accident. The amount agreed for non-economic loss is just fair and reasonable and within the range of likely potential damages assessment for the claim were the matter to be assessed by a Member of the Commission, taking into account the nature and extent of the injuries and the full recovery made by the claimant.
The injuries sustained to his thoracic spine have in majority healed and his ongoing neck pain is the most prevalent at present. The claimant requires physiotherapy on a regular basis to enable his participation in the workforce and retain his earning capacity. The claimant is a motivated person who will continue to work to the best of his ability and within his physical capacity. His treating specialists are regularly assessing his recovery and as long as he keeps to tasks within his restricted capacity, he is able to participate in work and recreational activities to his restricted level.
The past economic losses were supported by medical certificates for the period immediately post-accident and the claimant received statutory benefits at the time. Records of the insurer indicate that the sum of $88,324.82 has been paid to date for statutory weekly payments which will be deducted from the settlement.
The claimant is aware that from his settlement the insurer will deduct the already paid statutory benefits in the sum of $88,324.82 and that he will receive the balance in sum of $861,675.18.
I consider the agreed settlement in the sum of $950,000 is just fair and reasonable and within the range of likely damages had the matter been assessed by a Member of the Commission.
CONCLUSION
I am satisfied the proposed settlement of $950,000 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 injuries and losses sustained by the claimant.
I am satisfied the claimant was aware he could seek legal advice but chose not to avail himself of 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 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 from the proceeds a sum of $88,324.82 will be deducted as prepaid statutory benefits.
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 amount of $950,000.
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 2017/Personal Injury Commission Rules 2021.
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