AAI Limited t/as GIO v Morey
[2022] NSWPIC 36
•27 January 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | AAI Limited t/as GIO v Morey [2022] NSWPIC 36 |
| CLAIMANT: | Brett Morey |
| INSURER: | AAI Limited t/as GIO |
| MEMBER: | Anthony Scarcella |
| DATE OF DECISION: | 27 January 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Approval of settlement; section 6.23 of the Motor Accident Injuries Act 2017 (MAI Act); driver of a motor vehicle drove over a piece of timber causing it to be propelled from underneath its tyre and strike the claimant in the left foot; claimant sustained a penetrating wound causing laceration and tendon damage requiring surgical repair to the left foot and the subsequent development of a Morton’s neuroma requiring surgical excision; claimant returned to full-time work performing his normal supervisory duties two months following surgery with no restrictions; ongoing pain and discomfort in left foot managed with daily medication; ongoing sensation of numbness in the third and fourth toes; particular discomfort in the left foot by the end of the claimant’s 12 hour shift on his feet as a factory floor supervisor, irritated by his steel capped work boots; no entitlement to non-economic loss; whole person impairment assessed at 3%; allowance for past economic loss of $30,000; buffer of $70,000 for future loss of earning capacity and future loss of superannuation entitlements; Held - the total settlement of $100,586.36 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, the disabilities, the impairments and the losses sustained by the claimant, and taking into account the proposed reductions or deductions in the proposed settlement; the proposed settlement is approved under section 6.23(2)(b) of the MAI Act. |
| DETERMINATIONS MADE: | 1. The proposed settlement is approved. 2. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. 3. The proposed settlement complies with the damages settlement provisions in the Motor Accident Guidelines and r 95 of the Personal Injury Commission Rules 2021. |
STATEMENT OF REASONS
BACKGROUND
The claimant, Mr Brett Morey, is a 42-year-old man, who was involved in a motor vehicle accident on 13 September 2018 (the motor accident). The motor accident occurred whilst Mr Morey was walking on a driveway and the driver of a motor vehicle drove over a piece of timber causing it to be propelled from underneath its tyre and striking Mr Morey’s left foot, resulting in injury.
On 20 November 2018, Mr Morey lodged an application for personal injury benefits with AAI Limited t/as GIO (GIO), being the relevant compulsory third-party insurer of the vehicle at fault.[1]
[1] Application for damages settlement approval at pages 6-12.
On 18 December 2018, GIO accepted liability for statutory benefits in respect of weekly wage loss and treatment.[2]
[2] Application for damages settlement approval at pages 17-18.
On 19 February 2019, GIO determined that Mr Morey was not wholly or mostly at fault for the motor accident and that the deep laceration sustained to his left foot was not a minor injury. Liability was accepted to pay statutory benefits beyond the first 26 weeks after the motor accident.[3]
[3] Application for damages settlement approval at pages 19-24.
On 29 June 2021, Mr Morey lodged an application for damages under common law with GIO.[4]
[4] Application for damages settlement approval at pages 14-16.
On 17 September 2021, GIO admitted liability in respect of the claim for damages under common law.[5]
[5] Application for damages settlement approval at pages 25-26.
On 17 November 2021, Mr Morey consulted Dr Thomas Rosenthal, occupational physician, at the request of GIO. Dr Rosenthal provided GIO with a report dated 24 November 2021, in which amongst other things, he assessed Mr Morey’s whole person impairment under the Guide to the Evaluation of Permanent Impairment (fourth edition) and the Motor Accident Guidelines at 3%.[6]
[6] Application for damages settlement approval at pages 54-61.
On 3 December 2021, GIO proposed an offer of settlement to Mr Morey.[7]
[7] Application for damages settlement approval at page 27.
On 3 December 2021, Mr Morey accepted GIO’s proposed offer of settlement.[8]
[8] Application for damages settlement approval at page 29.
Mr Morey is not represented by an Australian legal practitioner. As Mr Morey is not legally represented, the proposed offer of settlement requires the approval of the Personal Injury Commission (the Commission).
On 10 December 2021, GIO lodged an application for damages settlement approval with the Motor Accidents Division of the Commission.
In the reply to the GIO’s application, Mr Morey also sought approval of the proposed settlement.
On 24 January 2022, I presided over a teleconference arranged in this matter by the Commission. Mr Ian Izzard appeared on behalf of GIO and Mr Morey represented himself. I had the opportunity to question Mr Morey. I offered Mr Izzard the opportunity to expand on his written submissions. I reserved my decision in respect of the application for damages settlement approval.
DOCUMENTS CONSIDERED
The following documents were before the Commission and considered in making this determination:
(a) GIO’s application for damages settlement approval dated 10 December 2021 and attached documents;
(b) Mr Morey’s reply undated, and
(c) GIO’s proposed agreement of release.
CONSIDERATION AND REASONS
The Legislation and legal principles
In making my decision I have considered the following legislation and guidelines:
(a) Motor Accident Injuries Act 2017 (the MAI Act);
(b) Motor Accident Guidelines 2017 (the Guidelines), and
(c) Personal Injury Commission Rules 2021 (the Rules).
Section 6.23 of the MAI Act states:
“6.23 Restrictions on settlement of claim for damages
(1)A claim for damages by an injured person cannot be settled within 2 years after the motor accident unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.
(2)A claim for damages cannot be settled unless –
(a)the claimant is represented in respect of the claim by an Australian legal practitioner, or
(b)the proposed settlement is approved by the Commission.
(3)The Commission is not to approve the settlement of a claim unless satisfied that the settlement complies with any applicable requirements of or made under this Act or the Motor Accident Guidelines.”
Rule 95 of the Rules states:
“95 Application for approval of damages settlement
(1)If the claimant, who is not represented by an Australian legal practitioner, and an insurer have agreed to a proposed damages settlement, the insurer must lodge an application for approval of a damages settlement under section 6.23 of the MAI Act on behalf of both the claimant and the insurer, within 7 days of reaching the agreement.
(2)An application may be lodged only if –
(a)it is more than 2 years after the date of the motor accident, or
(b)the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.”
Clause 7.37 of the Guidelines states:
“Under section 6.23(3) of the Act, before the Personal Injury Commission may approve the settlement of a claim for damages, it must be satisfied that:
(a)the proposed settlement satisfies the timing requirements in section 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.”
In its written submissions dated 10 December 2021,[9] GIO also sought leave to make this application for damages settlement approval more than three years after the motor accident. At the teleconference on 24 January 2022, Mr Izzard indicated that the said request for leave was made because he was uncertain whether such leave was necessary in the circumstances of an application for damages settlement approval where such application was lodged more than three years after the motor accident. Mr Izzard was concerned that this application could be interpreted as the Member of the Commission making an assessment of the claim for damages and thereby, enliven s 7.33 of the MAI Act.
[9] Application for damages settlement approval at pages 1-5.
Section 7.33 of the MAI Act provides that a party to a claim cannot refer a claim for assessment under Division 7.6 of the MAI Act more than three years after the motor accident unless the party provides a full and satisfactory explanation for the delay to the Commission and the Commission grants leave for the claim to be referred for assessment in accordance with the Rules. In my view, s 7.33 of the MAI Act does not apply to applications for damages settlement approval because this application does not seek to refer a claim for assessment under Division 7.6 of the MAI Act. The application for damages settlement approval does not involve a Member of the Commission assessing the claim for damages.
The evidence
Mr Morey was almost 39 years of age at the time of the motor accident. He is now aged 42 years.
Mr Morey was conveyed from the scene of the motor accident by ambulance to Albury Hospital, where the wound to his left foot was debrided and surgically repaired prior to discharge on 14 September 2018 in a controlled ankle motion (CAM) boot.[10]
[10] Application for damages settlement approval at pages 62-133.
A series of colour photographs taken at Albury Hospital on 13 or 14 September 2018, depicted a nasty penetrating wound to the top of Mr Morey’s left foot.[11] He wore the CAM boot for about four months.[12]
[11] Application for damages settlement approval at pages 180-183.
[12] Application for damages settlement approval at page 55.
Mr Morey was certified unfit for work from 14 September 2018 to 17 October 2018.[13] He was then certified fit for work with restrictions from 17 October 2018 to 17 November 2018.[14] On 28 November 2018, he was cleared to return to work without restrictions.[15]
[13] Application for damages settlement approval at pages 32-33.
[14] Application for damages settlement approval at page 34.
[15] Application for damages settlement approval at page 39.
Mr Morey underwent physiotherapy to improve functionality after he ceased using the CAM boot.
On 19 March 2019, Mr Morey first consulted Mr Paul Musarra, podiatrist, of Riverina Podiatry Group for the assessment and treatment of the ongoing pain in his left foot since the motor accident.[16] Mr Musarra diagnosed left second and third plantar metatarsophalangeal (MTP) joint capsulitis and left second plantar plate attenuation and recommended a treatment plan.
[16] Application for damages settlement approval at pages 42-43.
On 12 March 2019, Mr Morey underwent an MRI scan of his left foot by Dr Brendan Coghlan, radiologist.[17] Dr Coghlan concluded that Mr Morey had a Morton’s neuroma with associated intermetatarsal bursitis between the third and fourth metatarsal heads.
[17] Application for damages settlement approval at page 44.
On 17 September 2019, Mr Morey’s general practitioner referred him back to Riverina Podiatry Group for opinion and management of the Morton’s neuroma in his left foot after having undergone cortisone injections, which provided little pain relief.
On 5 June 2020, Dr Jeffrey Mahoney, general practitioner, referred Mr Morey to Dr Angela Hatfield, orthopaedic surgeon, for opinion and management because the pain in his left foot was now interfering with his work as a floor manager.[18]
[18] Application for damages settlement approval at page 47.
On 3 September 2020, Mr Morey consulted Dr Hatfield of Riverina Orthopaedics, who concluded that non-operative management had been trialled and that Mr Morey was still troubled by ongoing pain. Dr Hatfield recommended an excision of the Morton’s neuroma.[19]
[19] Application for damages settlement approval at pages 51-52.
On 1 December 2020, Mr Morey underwent a left foot excision of a Morton’s neuroma by Dr Anthony Bradshaw of Riverina Orthopaedics.[20]
[20] Application for damages settlement approval at page 53.
On 17 November 2021, Mr Morey consulted Dr Rosenthal at the request of GIO. Dr Rosenthal took a history of the motor accident that was consistent with the evidence. Mr Morey reported that he was in a CAM boot for four months and that the wound on his left foot healed slowly. He developed persistent significant pain in his left foot. He underwent an MRI scan and was diagnosed with a Morton’s neuroma. He came under the care of Dr Bradshaw, who removed the Morton’s neuroma on 1 December 2020. Following the surgery, the majority of the pain resolved but it was still causing him pain and some discomfort when he wore his steel capped work boots. He was treated by a podiatrist and given orthotics, which improved his symptoms somewhat. He continues to have symptoms in his left foot which are reasonably tolerable. He used to do a lot of running but does not do so now. He can walk for up to an hour. He treats the scar on his left foot with Strataderm. He no longer consults a podiatrist and is not required to consult Dr Bradshaw again.
Mr Morey described his current symptoms to Dr Rosenthal and they included discomfort in his left foot after a 12 hour shift at work (closed shoes particularly caused irritation) requiring daily medication (Nurofen and Panadol); numbness in the third and fourth toes of the left foot; and a clicking sensation in the left ankle.
Mr Morey described his current occupation to Dr Rosenthal. He works at Asahi Beverages, a bottling factory, where he is a supervisor and on his feet all day. He conducts inspections but is not required to perform any lifting. He has to wear steel capped safety boots and uses a high-quality boot off the rack and orthotics. He has worked at Asahi Beverages full-time for 10 years.
On examination, Dr Rosenthal observed that Mr Morey appeared to walk with normal gait and posture. There was a scar measuring 8cm x 3cm representing the original wound and a scar measuring 3.5cm from the Morton’s neuroma surgery. There were trophic changes, easily visible discolouration and contour changes on the original wound scar. Reduced sensation was evident around the third and fourth toes. The original wound scar had no adherence and the scars would normally be covered by socks unless he was wearing thongs. There was no wasting at the calves and he had a full range of left ankle movements.
Dr Rosenthal diagnosed a penetrating wound causing laceration and tendon damage requiring surgical repair to the left foot and the subsequent development of a Morton’s neuroma requiring surgical excision. He opined that the alleged injuries and disabilities were a direct result of the motor accident.
Dr Rosenthal opined that Mr Morey required no specific future treatment in respect of his injuries, apart from the occasional use of analgesia as required. He opined that the cost of analgesia would be a maximum of $50 per month and possibly only required for the next two to three years.
In respect of Mr Morey’s ability to resume his pre-accident employment, Dr Rosenthal observed that he had already resumed such employment. However, his work boots were irritating his left foot but it was not preventing him from performing his normal work activities.
Dr Rosenthal assessed Mr Morey’s whole person impairment at 3%. He allocated 1% for sensory loss and 2% for scarring.
At the teleconference, Mr Morey told me that he worked 12 hour shifts in production and that by the end of his shift he felt some pain and discomfort in his left foot. He used to do a lot of running and, in fact, ran marathons. He can no longer do that. He did not wish to obtain independent legal advice. He was happy with the proposed settlement and wanted to move on and put the claim behind him. He requested the Commission to approve the proposed settlement.
The proposed settlement agreement
The total of the proposed settlement is $100,586.36. There is no allowance for non-economic loss. There is an allowance of $30,000 for past economic loss. There is an allowance of $70,000 for future economic loss.
The proposed settlement of $100,586.36 is subject to the following deductions:
(a) GIO’s payments of statutory weekly benefits totalling $18,306.36, and
(b) Australian Taxation Office payments totalling $2,280.
GIO stated that there were no amounts advanced by it to Mr Morey. GIO does not intend to deduct any amounts that may be refundable to Medicare Australia. Centrelink has not notified GIO that it has any relevant charge. GIO understands that Mr Morey has not received any Centrelink benefits.
It has been agreed that the amount payable to Mr Morey, after rounding up, is $80,000.
During the teleconference on 24 January 2022, Mr Morey acknowledged the matters referred to in [41]-[44] above.
Having considered the available evidence from the treatment providers and the medico-legal report of Dr Rosenthal, I am satisfied that there would not be any prospects of Mr Morey achieving an assessment of greater than 10% whole person impairment. I am satisfied that Mr Morey would not have any entitlement to non-economic loss.
At the time of the motor accident, Mr Morey was employed as a supervisor by Asahi Beverages earning about $1,569 net per week. The evidence is that he was unfit for work for a period just short of five weeks immediately following the motor accident and then fit to resume work on restricted duties for about 4.5 weeks. He was unfit for work for one week in September 2020. Finally, he was unfit for work from 26 November 2020 until 20 January 2021 as a result of the excision of the Morton’s neuroma. Accordingly, I consider the assessment of past economic loss at $30,000 to be appropriate.
Mr Morey is presently aged 42 years and has another 25 years of working life ahead of him.
In assessing future economic loss, regard must be had to the provisions of s 4.7 of the MAI Act, which states that no allowance may be made for future loss of earning capacity unless Mr Morey establishes the motor accident caused a change in his most likely future circumstances.
I accept that, having regard to the length of Mr Morey’s employment with Asahi Beverages, it is reasonable to assume that the most likely future circumstances, but for the injury sustained in the motor accident, were that he would continue to work in a supervisory capacity at his current place of employment or in a similar supervisory capacity elsewhere. Mr Morey’s work as a supervisor does not involve any heavy lifting but he is required to be on his feet to carry out inspections on his 12 hour shifts.
Mr Morey’s evidence was that he had resumed his normal activities at work. There was no medical evidence that restrictions ought to be imposed on Mr Morey’s future work activities or that his injuries would result in any impairment of his future earning capacity. Certainly, Dr Rosenthal did not impose any work restrictions. However, Mr Morey continues to suffer from pain and discomfort in his left foot by the end of his 12 hour shifts. Further, the protective footwear that he is obliged to wear at work irritates his symptoms. In such circumstances, I am satisfied that the injuries sustained by Mr Morey in the motor accident are likely to result in the need to take time off work and seek treatment at times of experiencing an exacerbation of his pain and result in a diminution of his earning capacity resulting in economic loss: Medlin v State Government Insurance Commission[21] and Husher v Husher.[22]
[21] Medlin v State Government Insurance Commission (1995) HCA 5.
[22] Husher v Husher HCA 47.
It is appropriate to consider a buffer or cushion for future economic loss when the impact of an injury on the economic benefit from exercising an earning capacity after injury is difficult to determine: Penrith City Council v Parks.[23] I am satisfied that this is an appropriate case for the award of a buffer. I consider the proposed buffer of $70,000 inclusive of the loss of superannuation benefits to be an appropriate sum in the circumstances of this case.
[23] Penrith City Council v Parks [2004] NSWCA 201.
Conclusion
The motor accident occurred on 13 September 2018, which is more than two years after the date of the motor accident and in this regard one of the requirements under s 6.23 (1) of the MAI Act has been satisfied.
I am satisfied that 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, the disabilities, the impairments and the losses sustained by Mr Morey, and taking into account the proposed reductions or deductions in the proposed settlement.
I am satisfied that Mr Morey understands that he is entitled to be represented in respect of the claim by an Australian legal practitioner but does not wish to do so.
I am satisfied that Mr Morey understands the binding nature and effect of the proposed settlement and that he will be precluded from making a further claim for damages arising out of the motor accident.
I am satisfied that Mr Morey is willing to accept the proposed settlement.
Accordingly, under s 6.23(2)(b) of the MAI Act, I approve the settlement of Mr Morey’s claim for damages in the total sum of $100,586.36.
Anthony Scarcella
Member (Motor Accidents Division)
Personal Injury Commission
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