AAI Limited t/as GIO v Hamson
[2024] NSWPIC 563
•11 October 2024
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as GIO v Hamson [2024] NSWPIC 563 |
| CLAIMANT: | Maxene Hamson |
| INSURER: | AAI Limited t/as GIO |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 11 October 2024 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; settlement approval under section 6.23 in the sum of $103,637.45; 47-year-old female; no entitlement to non-economic loss; 4% whole person impairment; small closed period past economic loss $28,637.45 and buffer future economic loss of $75,000; injuries to right shoulder requiring surgical intervention on two occasions now resolved and minor scarring; Held – proposed settlement is just, fair and reasonable; settlement approved. |
| DETERMINATIONS MADE: | CERTIFICATE Issued under s 6.23 of the Motor Accident Injuries Act 2017 1. The proposed settlement in the sum of $103,637.45 is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. 2. The proposed settlement complies with cl 7.392 to cl 7.411 of the Motor Accident Injuries Guidelines. |
STATEMENT OF REASONS
INTRODUCTION
Maxene Hamson
(the claimant) was a passenger in a car driven by her husband on
1 January 2019. A kangaroo ran in front of the car and struck the windscreen. The driver lost control of the vehicle landing in a ditch.
No police or ambulance were called. It was on private property, their own farm.
The claimant attended Maitland Hospital the day after where scans revealed a fracture of the upper end of her right humerus. She was then transferred to John Hunter Hospital on
5 January 2019 for intramedullary nailing performed by Dr John Estens.
The claimant’s fracture did not unite and she subsequently underwent further surgery a revision ORIF and iliac bone graft on 9 September 2019 under the care of Dr Zsolt Balogh.
Physiotherapy was thereafter undertaken for a period of nine months at Singleton Physiotherapy and by 30 January 2020 the claimant’s condition had progresses with nearly full range of motion.
The claimant brought a claim for common law damages alleging she sustained the following injuries:
(a) spiral fracture of humerus -right arm, and
(b) scarring.
An application for personal injury benefits was lodged on 9 January 2019. The insurer under cover of letter dated 23 January 2019 determined weekly payments of $898.01 pre-accident average weekly earnings.
The claimant brought a common law claim for damages was lodged on 11 November 2020.
The insurer admitted liability for the claim on 5 March 2021.
The insurer arranged for the claimant to be assessed by Dr Rosenthal at their request, on
12 April 2024. His report dated 15 April 2024 provided an opinion on whole person impairment relating to the spiral fracture of the right upper humerus requiring internal fixation and scarring from the two surgeries and scarring. His determination was 3% for upper arm and 1% for scarring.
As a consequence of the assessment of whole person impairment 4%, 3% for upper limb and 1% for scarring the parties agreed the claimant had no entitlement to non-economic loss as whole person impairment did not exceed 10%, the percentage threshold required to be met to qualify for damages for non-economic loss.
The parties have reached an agreement to settle the claim in the sum of $103,637.45. The amount represents to sum of $28,637.45 for past economic loss and a buffer of $75,000 for future economic loss.
Past economic loss
The claimant was certified fit for pre-injury duties by 1 April 2020 by Dr Au (p 299 of bundle).
At the date of the accident the claimant was working in a take-away business and her pre-injury earning capacity of $751.01 weekly.
(a) The claimant was unfit for work due to her injuries and claimed the difference between her pre-accident earning capacity and her actual earnings over the period from the date of accident to date. The periods were broken down to the following:
(i)unfit for work from 2 January 2019 to 1 April 2019;
(i)working 18 hours weekly from 2 April 2019 to 25 April 2019;
(i)working full-time with restrictions from 26 April 2019 to 8 September 2019;
(i)unfit from 9 September 2019 to 3 November 2019;
(i)working 18 hours weekly from 28 October 2019 to 28 November 2019;
(i)working 24 hours per week from 30 November 2019 to 6 January 2020;
(i)working 32 hours from 9 January 2020 to 9 February 2020, and
(i)working 40 hours from 5 February 2020 to 5 March 2020.
(b) By 1 April 2020 the claimant was certified fit to return to pre-injury duties.
The insurer calculated the past economic loss by calculating the expected earning capacity uninjured and subtracted the actual earning capacity and the difference was the established loss. Losses of $20,133.18 were broken down as follows:
(a) period 2 January 2019 to 31 December 2019 = $19,564.52;
(b) 1 January 2020 to 7 January 2020 = $229.61, and
(c) 8 January 2020 to 9 February 2020 = 339.05.
In addition to the above, the claimant required six days off work to attend medical appointments and the loss equated to the sum of $910.66.
To attend Dr Rosenthal the claimant’s loss for that day off and the difference of $219.60.
The insurer then allowed superannuation at 11% on past losses in the sum of $2,342.28 and tax of $2,787. Total was 26,422.72 and this was increased to $28,637.45 with further submissions for travel costs and this sum amounted to an additional sum of $2,214.73.
Total past losses amounted to $28,637.45.
The claimant reported to Dr Rosenthal that she left her pre-accident position in September 2023 and moved to another take away shop doing 35 hours a week making sandwiches and hot food and doing some cooking. She avoids overusing her right arm and has changed how she undertakes her tasks relying on her left arm more from time to time.
The claimant now works for Happy Grillmores earning between $34-36 hourly. She is working 37 hours weekly and receives $1,011 net. During the second preliminary conference the claimant confirmed she is earning more in her current role than her pre-accident position and has not required time off for a while. With the only ongoing symptom being a dull ache from time to time, the claimant advised me in conference that she was confident that the current position was not impacted by the ongoing symptoms and at best she would require time off if her right shoulder was aggravated. Impact to earning capacity was intermittent at best.
Future economic loss
Whilst the claimant has returned to full-duties, the insurer accepted the comment of
Dr Rosenthal that the claimant had reported to him she had some self-reported restrictions. He felt that she should have a lifting restriction with her right arm limited to a maximum of 5kg and to avoid above shoulder height activities.
Having regard to the opinion of Dr Rosenthal the insurer considered a buffer of $75,000 for future economic loss, even though she has remained in employment for the past four years and has secured new employment which is at a higher rate.
The application before me is for the approval of the settlement.
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 Personal Injury Commission Guidelines.
Clause 7.38 of the Guidelines states I must be satisfied as to the following:
(a) 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
(b) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
Preliminary conference on 26 August 2024
The conference was conducted via video-link. On this occasion the nature of the settlement was discussed. The claimant advised she held concern for the impact of her injury and the risk of arthritic changes to her right shoulder over time. She also described psychological symptoms which included fear of travel, situations which she believes triggers her and the fear of her scarring getting worse.
The nature of the settlement was discussed and the claimant informed that should she wish to, there was still time to seek legal opinion before the matter was concluded.
I decided that the claimant should investigate her concerns relating to arthritic changes and psychological injury be investigated. The claimant agreed she would like the opportunity to make further enquiries before the matter was concluded.
Directions were made that the insurer obtain a supplementary report from Dr Rosenthal as to the impact if any of post-traumatic arthritic changes and prognosis. The claimant was requested to serve any further report or information on the insurer relating to psychological injury if she intended to pursue the matter further in the interval.
Preliminary conference on 19 September 2024
The claimant confirmed at this preliminary conference that she had decided not to pursue psychological injury and wanted the matter to be concluded without any further investigation or information.
She confirmed she had received from the insurer the supplementary report of Dr Rosenthal dated 29 August 2024 and his opinion satisfied her concern relating to the possibility of future arthritic changes and impact on future earning capacity.
Dr Rosenthal opined in this report:
“Based on the available information, there is no indication that the glenohumeral joint of her right shoulder was impacted by the spiral fracture of her right upper humerus. The reduced range of motion now present in her right shoulder is related to the surgery, the soft tissue damage and scarring as a result of the surgery. There is no indication that she aggravated an arthritic process in her right shoulder. Based on this, there is no increased likelihood of arthritic changes that would occur in the right shoulder as a result of the subject accident.”
At the conference the claimant was questioned on her understanding of the settlement, the impact of a settlement and whether she was entering the settlement on her own free will. I am satisfied that she is entering into the settlement of her own free will, with understanding of its finality.
The claimant confirmed she knew she could seek legal advice and had chosen not to avail herself of legal representation.
Statutory payments were confirmed by the insurer in the sum of $23,637.45 and the claimant was informed that the net sum to be received by the claimant would amount to $80,000.
The parties confirmed their desire for the settlement to be approved and advised there was no other information to be relied upon.
DOCUMENTS CONSIDERED
I have regard to the following relevant documents contained in evidence bundle of 110 pages:
Liability:
(a)police report dated 2 April 2023;
(b)application for statutory benefits dated 9 January 2019;
(c)Liability notice for statutory benefits dated 23 January 2019;
(d)application for common law damages dated 11 November 2020;
(e)liability notice dated 5 March 2021;
(f)deed of release – dated 12 July 2024, and
(g)submissions of the insurer dated 24 July 2024.
Medical records:
(a)medical certificates;
(b)Maitland Hospital records;
(c)John Hunter Hospital clinical records;
(d)MRI cervical spine and brachial plexis dated 15 April 2019;
(e)AHRR Physiotherapy Notes – various and EP reports 2020;
(f)physiotherapist reports 28 November 2019 - 26 November 2020;
(g)rehabilitation reports, and
(h)Certificates of Capacity 18 January 2019 to 30 March 2020.
Financial records:
(a)notices of assessment - 2018 to 2023, and
(b)payment summaries - 2020-2022.
Claimant’s information
(a) replies to particulars 3 March 2021;
(b) email dated 30 November 2023, and
(c) Statement of claimant.
Settlement documents:
(a)Settlement Offer dated 24 July 2024, and
(b)Deed of Release dated 29 July 2024.
Injuries
The claimant’s application for common law damages noted she sustained the following injuries:
(a) right shoulder injury. Requiring internal fixation on two occasions, and
(b) psychological injury – untreated to date.
Non-economic loss
The claimant did not sustain injuries which have resulted in a determination of whole person impairment exceeding 10%. Dr Rosenthal opined the claimant’s whole person impairment amounts to 4%. The claimant did not contest this assessment. She was informed that she could seek her own medical assessment if she wished to dispute the assessment.
The claimant complained of psychological symptoms consequent upon the injuries sustained in the accident but chose not to seek treatment or obtain an assessment of whole person impairment relating this her fear of travel.
On the available medical evidence, I am satisfied that the claimant would not be entitled to non-economic loss.
Past economic loss
I am satisfied that the past losses agreed to between the parties accords with the financial records produced by the claimant which included pay slip and the medical records and certificates of fitness issued.
Future economic loss
The claimant was working in a take away preparing food and serving at the date of accident. She continues to work in this environment. She is currently aged 47 years and has a further 20 years to retirement age.
The claimant advised that she now manages her tasks by avoiding where she can overuse of her right arm to avoid exacerbating any symptoms. This has been successful to date with reliance of some tasks being now performed by her left arm. She reported during the second preliminary conference that she was able to undertake her current role without complications.
The claimant also confirmed she has not required any time off over the last year for her accident-related right arm injury. She reported she manages well and avoids overuse where she can.
She reported travel phobia and fear but has not sought any treatment and I infer from this that it is not of a severity that would impact on the claimant’s future earning capacity, in any way.
The claimant confirmed to Dr Rosenthal that she has now secured a new position where she is earning more working less hours. Dr Rosenthal in his supplementary report opined:
"Based on the available information, there is no indication that the glenohumeral joint of
her right shoulder was impacted by the spiral fracture of her right upper humerus. The
reduced range of motion now present in her right shoulder is related to the surgery, the
soft tissue damage and scarring as a result of the surgery. There is no indication that
she aggravated an arthritic process in her right shoulder. Based on this, there is no increased likelihood of arthritic changes that would occur in the right shoulder as a result of the subject accident.”
A buffer has been allowed in the sum of $75,000 for any loss of impact to her future earning capacity as a consequence of the 5kg lifting restrictions suggested by Dr Rosenthal.
Whilst the claimant does not currently show an impact upon her earning capacity into the future, the provision of a buffer is appropriate where an exact weekly loss cannot be ascertained.
The claimant has mitigated her losses to her credit.
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 $103,637.45 be approved.
The claimant also confirmed her desire that the settlement be approved by me.
Impact of injuries upon the claimant
The claimant’s short statement referred to the following:
“As well as the physical suffering that I have endured in this ordeal, I am know left with the mental scars of the accident. Travelling to work with a substantial amount of mine workers traffic and a lot of semi-trucks can leave me with some anxiety. Particularly when being a passenger. This is not just the work travel but also pleasure trips taken with my family. I suffer from nightmares particularly if there has been an accident on the road that I have travelled that day.
The prolonged suffering between surgeries and the scars that I now bear (most of which I deem to be extreme and quite possibly unnecessary are) somewhat embarrassing (I.used to wear a lot of singlet style tops and dresses and know cover up to stop the stares from strangers. They are still tender to touch and can become itchy. In addition, laying on them at night is uncomfortable and can leave my shoulder quite sore.” (p 336 of bundle)
REVIEW OF THE EVIDENCE
Clinical records of Maitland Hospital dated 15 April 2019 provided treatment details and wound management.
Clinical records of John Hunter Hospital dated 27 May 2024 provided further details of treatment and stabilisation of injuries.
MRI scan of cervical spine and brachial plexus dated 15 April 2019 evidenced surgery to humerus with intramedullary nail. Tendinopathy of supraspinatus tendon with no focal tear. There was no muscle atrophy or soft tissue mass.
Physiotherapy and rehabilitation records produced confirm that the claimant’s injuries have in majority reached maximum medical improvement. In the rehabilitation closure report of
2 April 2020 provided a details history of her return to work after the initial accident and after surgery performed by Dr Balogh on 9 September 2019.
Certificates of capacity indicate the claimant was off work for the periods described due to the impact of her injuries. In the final report dated 31 March 2020 it was noted that there was full range of motion in shoulder and strength for pulling, pushing, lifting waist to shoulder of 20kg and overhead lifting capacity of 5kg.
Payslips produced from Crib break accord with the claimant’s pre-injury weekly earning capacity amounting to $20.79 per hour with casual loading of $5.20. Her net weekly pay $800.54 working 37.5 hours.
Payslips of Happy Grillmores at p 324 of bundle confirm the claimant’s current earning capacity is $34-36 per hour working 33.5 hours at $34 and 3.5 hours at $36 per hour with her net pay after tax deducted amounts to $1,011 weekly.
The supplementary report of Dr Rosenthal commenting on the risk of post-traumatic arthritis dated August 2024 confirmed there was little risk of further deterioration or arthritic change.
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 complaince with any of the requirements of the MAI Act or the Motor Accident Guidelines.
I am satisfied that there has been compliance with the Act and the Guidelines.
(b) Clause 7.389 of the Guidelines requires the insurer to include in its application details of the following:
(i)sub-clause 7.389.1 requires the amount of the proposed settlement and a breakdown of the amount allowed for each head of damage.
The amount for past economic loss is $28,637.45; the amount for future economic loss is $75,000;
(ii)Sub-clause 7.389.2 requires the amount of any deductions in the proposed settlement.
The insurer has paid to the claimant statutory payments in the sum of $23,637.45 which it seeks credit. The claimant will receive net proceeds of $80,000;
(iii)Sub-clause 7.389.3 requires the amount of any advanced payments made be specified. There had not been any advanced payments made apart from known statutory benefits.
Medical expenses have been met by the insurer and these do not form part of the settlement, and
(iv)Sub-clause 7.389.4 requires the evidence, documents and materials relevant to an assessment of the proposed settlement figure.
I have reviewed the clinical and medical records effectively convering the period of injury and the relevant period to date. I note the medical records accord with the claimant’s reported symptoms and periods of incapacity. The financial records provided accord with the claimant’s history of earning capacity and time off work taken due to her injuries and further surgery. The information produced by the insurer has given me a good indication of the injuries, treatment and prognosis.
(c) Clause 7.399 of the Guidelines, requires me to consider the following:
(i)sub-clause 7.399.2: appropriateness – 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 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 medical evidence produced in this matter, I am satisfied that the claimant has made good recovery and has returned to work with limited restriction. The amounts allowed for past and future economic loss accords with the facts. I find the sum agreed upon is just, fair and reasonable and within the likely range of damages were it to have been assessed by a Member of the Commission, and
(ii)sub-clause 7.399.3: understanding – the claimant understands the nature and effect of the proposed settlement is the finality of her claim for damages and is willing to accept the proposed settlement.
The claimant was made aware in the teleconferences that in the event she took the settlement, she could not seek any further damages for non-economic losses and economic losses. She was advised that the insurer would still provide ongoing medical treatment and care needs, if required and approved by the insurer based upon medical need.
The claimant was also made aware that the insurer would continue to meet any charge issued by Medicare and that the insurer has agreed to reimburse Health Insurance Commission separately, if appropriate.
I am satisfied that the claimant was aware of her 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 $103,637.45 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 the claim, the injuries, disabilities, impairments and losses sustained by the claimant.
I am satisfied the claimant was aware she could seek legal advice and but chose not to retain legal representation.
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 subject accident.
I am satisfied the claimant was willing to accept the proposed settlement and her decision to accept it was of her own volition.
I am satisfied the claimant is aware that $23,637.45 will be deducted from the proceeds of settlement and that she will receive $80,000 net.
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 $103,637.45.
The proposed settlement complies with cl 7.392 to cl 7.411 of the Motor Accident Injuries Guidelines.
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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