AAI Limited t/as GIO v Bonadio
[2022] NSWPIC 223
•18 May 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | AAI Limited t/as GIO v Bonadio [2022] NSWPIC 223 |
| CLAIMANT: | Melinda Bonadio |
| INSURER: | AAI Limited t/as GIO |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 18 May 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Settlement approval; 69-year-old female; passenger in accident; 9 fractured ribs, fractured sternum, shock and bruising; 0% whole person impairment so no entitlement to non-economic loss; past economic loss; future economic loss Penrith City Council v Parks considered; section 6.23 of the Motor Accident Injuries Act 2017; Held – proposed settlement is just, fair and reasonable; settlement approved. |
| DETERMINATIONS MADE: | 1. This proposed settlement is approved. 2. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017 (the Act). 3. The proposed settlement complies with cl 7.392 to cl 7.411 of the Motor Accident Injuries Guidelines. |
INTRODUCTION
On 18 September 2019 Melinda Bonadio (the claimant) sustained injury in a motor vehicle accident (the accident).
The claimant has made a claim against GIO (the insurer) of the at fault vehicle, for lump sum damages.
The insurer accepted liability for the claimant’s claim for statutory benefits and has paid her $39,771.08 by way of statutory weekly benefits and seeks credit for that sum. This amount was an overpayment of weekly benefits.
The insurer has accepted that the claimant had non-minor injuries and pursuant to Division 3.4 of the Motor Accident Injuries Act 2017 (the MAI Act) she is entitled to payment of reasonable treatment and care for the rest of her life for her accident caused injuries.
Upon the determination of Dr Raymond Wallace the claimant’s whole person impairment was not greater than 10%. This means the claimant is not entitled to recover damages for non-economic loss. I am satisfied that the medical evidence before me indicates that the opinion of Dr Wallace is accurate noting the injuries sustained and the recovery as defined in the medical records.
The claimant and the insurer have agreed to settle the claim for lump sum damages for the sum of $102,000. The settlement offer made by the insurer in the sum of $102,000 has been calculated as follows:
· $22,000 for past economic loss, and
· $80,000 for future economic loss.
Because the claimant is not represented by a lawyer, her settlement must be approved in accordance with the MAI Act.
I have decided to approve the settlement.
JURISDICTION OF THE PERSONAL INJURY COMMISSION
The Personal Injury Commission (the Commission) was established on 1 March 2021 and the Dispute Resolution Service was abolished by clause 3 of Part 2, Division 2, Schedule 1 to the Personal Injury Commission Act 2020.
I am a Member of the Motor Accidents Division of the Commission. Clause 14A (1) of the Personal Injury Commission Regulation 2020 designates the application “pre-establishment proceedings” and clause 14D empowers me to determine those proceedings.
Because of the date of the accident clause 14D(3)(b) provides that the MAI Act and the Motor Accident Guidelines (the Guidelines) continue to apply.
THE RELEVANT LAW
Section 6.23(1) of the MAI Act provides a claim for damages cannot be settled within two years after the accident unless the degree of permanent impairment of the injured person caused by the accident is greater than 10%.
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 any of the requirements of the MAI Act or the Guidelines.
Clause 7.38 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 MAI 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 a claims assessor, 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, and
(c) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
TELECONFERENCE ON 26 APRIL 2022
The insurer lodged the application for approval of the settlement, and it was referred to me for consideration. I held a teleconference on 26 April 2022. The claimant participated in person and the insurer was represented by Melanie Gazdag.
I discussed the details of the terms of settlement with the parties and it became apparent that the claimant thought she would be receiving more for future economic loss. The insurer at this point advised that whilst past economic losses amounted to $22,000, it had overpaid the claimant in a sum of $39,771.08 as the fortnightly earnings were paid as weekly.
The insurer’s position was that the settlement was $80,000 in total and after deductions the claimant would receive $40,228.92.
Upon review of the documentation before me I advised the parties it was likely that the terms should have been $102,000 representing $80,000 for future economic loss and $22,000 for past economic loss.
The parties were to investigate their understanding of what have been agreed and a further teleconference was scheduled.
TELECONFERENCE ON 4 MAY 2022
The insurer as a gesture of good faith increased their settlement to $102,000 to reflect past economic loss of $22,000 and $80,000 for future economic loss.
The claimant on 3 May 2022 had executed the Agreement of Release accepting this sum as full and final settlement of her economic loss claimed.
I explained that there would be no additional amounts that could be claimed for economic loss once this amount had been agreed upon and the claimant advised me she was happy with the result. I asked her if she had considered consulting a lawyer.
I was advised she did not want to go down that route and was quite happy with the sum involved. She indicated she was wanting to finalise the matter as soon as possible.
DOCUMENTS CONSIDERED
I had regard to the following relevant documents:
· insurer submissions;
· Application for Personal Injury Benefits;
· police report;
· liability notice dated 8 June 2021;
· discharge summary and clinical records John Hunter Hospital;
· certificate of fitness – various;
· certificate of fitness for pre-injury duties dated 16 June 2021;
· Broadmeadow physiotherapy report dated 25 May 2020;
· referral and approval to Anne Sharkey;
· Dr R Wallace medico-legal report dated 8 October 2021;
· claimant’s response to particulars;
· payslip;
· Deed dated 2 May 2022, and
· list of payments.
REVIEW OF THE EVIDENCE
The claimant is currently 69 years of age.
The claimant was a front seat passenger, travelling in vehicle DC145 when the insured driver, travelling in the opposite direction (vehicle BN27NR), braked in wet weather conditions and lost control of his vehicle. As a result of losing control, the insured vehicle crossed over to the incorrect side of the road and collided with the vehicle the claimant was travelling in.
Police and ambulance attended the accident scene.
Liability was admitted in the claimant’s common law claim on 8 June 2021.
INJURIES
Following the accident, the claimant was conveyed by way of ambulance to John Hunter Hospital where she remained for one week before being discharged home.
As a result of the accident the claimant sustained the following injuries:
a. nine fractured ribs;
b. fractured sternum;
c. shock, and
d. bruising.
The claimant consulted her general practitioner (GP), Dr Boyd, who has provided a number of medical certificates, first certifying the claimant unfit for work, and then certifying a graduated return to pre-injury duties and hours.
The claimant was assessed by Dr Wallace, orthopaedic surgeon on behalf of the Insurer, on 6 October 2021. Dr Wallace confirmed the circumstances of the accident and noted the claimant to have sustained fractures involving the left ribs, three through to five, and fractures to the right ribs, three through to eight, with a mildly displaced fractured sternum and manubrium. He noted that the claimant had undergone treatment in the form of a seven month physiotherapy program in addition to a five month course of exercise physiology. As at date of assessment the claimant was not undergoing any form of further treatment. Dr Wallace opined that the claimants fractured ribs and sternum, at the time of assessment, had resolved. Dr Wallace opined that the claimant was fit for pre-injury duties as a part time registered nurse at pre-injury hours at the time of his assessment.
Whilst the claimant is not currently undergoing any treatment, the insurer noted that any further treatment required will continue to be provided to the claimant (on the basis it is reasonable and necessary) irrespective of settlement of the claimant’s damages claim.
ECONOMIC LOSS
At the time of the accident the claimant was 66 years of age, working casually as a registered nurse in the renal ward at John Hunter Hospital.
Following the accident, the claimant was certified as unfit for work until February 2020.
Thereafter, the claimant was gradually upgraded in fitness for work, and on 16 June 2020 was certified by her GP, Dr Boyd as fit for pre-accident duties and hours from 30 June 2020 onwards.
As the claimant’s employer was unable to accommodate the claimant’s restrictions until a full medical clearance was received, the claimant never returned to work after the subject accident.
Although certified as fit for pre-injury duties as at 30 June 2020, the claimant resigned from work in July 2020, aged 67 (turning 68 in October).
The claimant has provided particulars to the insurer on 3 February 2022 indicating that prior to the accident, it was her intention to have continued working as a “registered nurse for 3 to 5 years further.” That is, until age 69 – 71.
When analysing the payslips provided by the claimant to the insurer, it shows that in the 30 weeks before the subject accident the claimant worked, on average, 13.83 hours a week, which averaged $439.61 net per week.
In the table provided below, the insurer noted there were four fortnightly payslips missing (28/1/2019 – 10/2/2019, 11/2/2019 – 24/02/2019, 11/03/2019 –24/03/2019, 25/03/2019 – 10/03/2019). Given the claimant was employed casually, the implication could be drawn that the claimant did not work during these periods.
Giving the claimant the benefit of the doubt however, the insurer did not count these eight weeks when working out averages. If it did, the claimant’s average hours per week would instead total 10.9 hours, with an average net weekly wage of $347.06.
The evidence contained in the payslips revealed the following earning capacity
· 31 December 2018 to 13 January 2019, 8 hours $639.68;
· 14 January 2019 to 27 January 2019, 26 hours $897.81;
· 25 February 2019 to 10 March 2019, 16 hours $588.19;
· 8 April 2019 to 21 April 2019, 8 hours $294.09;
· 22 April 2019 to 5 May 2019, 8 hours $294.09;
· 6 May 2019 to 19 May 2019, 24 hours $846.28;
· 20 May 2019 to 2 June 2019, 16 hours $588.19;
· 3 June 2019 to 16 June 2019, 32 hours $1,064;
· 17 June 2019 to 20 June 2019, 23 hours $819.52;
· 1 July 2019 to 14 July 2019, 48 hours $1,480;
· 15 July 2019 to 28 July 2019, 48 hours $1,480;
· 29 July 2019 to 11 August 2019, 48 hours $1,597.76;
· 12 August 2019 to 25 August 2019, 38 hours $1,264;
· 26 August 2019 to 8 September 2019, 14 hours $527.67;
· 9 September 2019 to 22 September 2019, 22 hours $807.11, and
· average per week 13.83 hours $439.61.
PAST ECONOMIC LOSS
Applying an average net weekly wage of $440 (rounded) per week from date of accident to 30 June 2020 (when the claimant was certified as fit to return to work) totals $18,040.
Superannuation at 13% of the net figure, totals $2,345.20.
This was rounded up by the insurer to a total of $22,000 for past economic loss inclusive of superannuation.
The claimant verified that this was an accurate representation of her earnings in the first teleconference held.
FUTURE ECONOMIC LOSS
As at 30 June 2020 the claimant was certified by her GP, Dr Boyd as fit to return to pre-injury hours and duties
Dr Wallace also opined as at 8 October 2021 that the claimant was fit for pre-accident hours and duties, working as a nurse in the renal ward.
The insurer noted the claimant retired in July 2020 aged 67 (3 months shy of her 68th birthday). Whilst the claimant was certified as fit to return to pre-injury duties and hours as at 1 July 2020, she retired that month. The insurer accepted the accident-related injuries may have had some impact on the claimant’s performance of her duties had she returned to her duties, and in that regard the insurer allowed a buffer of $80,000.
The claimant provided her tax returns between 2016 and 2019. Her income was recorded as follows:
· 2016 - $42,375;
· 2017 - $37,558;
· 2018 - $35,944, and
· 2019 - $19,263.
The claimant confirmed that her loss would equate to two years at the rate of $40,000 per annum.
SHOULD I APPROVE THE SETTLEMENT
I am satisfied that the amounts allocated in the settlement for past and future economic losses accord with the financial records produced in this matter.
The sum of $22,000 for past economic loss is appropriate. The insurer is to have credit for the sum of $39,771.08 paid in weekly statutory payments.
In assessing future economic loss, I must have regard to the provisions of s 4.7 of the MAI Act which states no allowance may be made for future loss of earning capacity unless the claimant establishes that the accident has caused a change in her most likely future circumstances.
In cases such as Medlin v State Government Insurance Commission (1995) 185 CLR and Husher v Husher (1999) 197 CLR 138, the High Court confirmed that the fundamental questions to be determined in a case such as this, are whether the claimant has sustained a loss or diminution in his earning capacity and, if so, whether that loss or diminution will result in economic loss.
Further, it is appropriate to award a buffer when the impact of an injury upon the economic benefit from exercising earning capacity after injury is difficult to determine, as per Penrith City Council v Parks [2004] NSWCA 201. I agree that this is an appropriate case for the award of a buffer.
I also agree that a buffer of $80,000 for the future impairment of the claimant’s earning capacity is appropriate having regard to information before me.
I am satisfied that the claimant is aware of her right to have her reasonable treatment expenses paid and note her extent of treatment at present is limited.
Ms Gazdag advised the insurer would not deduct and pay monies to Medicare under the Health and Other Services (Compensation) Act 1995 (Cwlth) from the settlement sum. He advised the insurer has asked Medicare to issue a Claims History Statement for completion by Mr Wilkie. If any charge is raised the insurer will pay the charge as a treatment expense in addition to the settlement sum.
I advised the claimant if a charge is raised by Medicare in respect of treatment expenses paid by Medicare relating to the injury, she should refer the matter to the insurer to pay that charge as part of their obligation to pay reasonable treatment costs.
CONCLUSION
I find the timing requirements of section 6.23(1) of the MAI Act satisfied where it is now two years since the date of accident.
I am satisfied the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments 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 the claimant.
I am satisfied the claimant is aware she can seek legal advice but does not wish to do so.
I am satisfied the claimant understands the binding nature of the settlement and that she will be precluded from making a further claim for damages arising out of the accident. I am satisfied the claimant is willing to accept the proposed settlement.
Accordingly, pursuant to section 6.23(2(b) of the MAI Act I approve the settlement of the claimant’s claim for damages.
Legislation
In making my decision I have considered the following legislation and guidelines:
· the MAI Act;
· Motor Accident Injuries Regulation 2017;
· Personal Injury Commission Regulation 2020;
· Motor Accidents and Workers Compensation Legislation Amendment Regulation 2020;
· the Guidelines, and
· Personal Injury Commission Rules 2021.
Shana Radnan
Member (Motor Accidents Division)
Personal Injury Commission
0
3
0