Betteridge v Insurance Australia Limited t/as NRMA Insurance

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Betteridge v Insurance Australia Limited t/as NRMA Insurance [2023] NSWPIC 171
CLAIMANT:	Stephen Betteridge
INSURER:	Insurance Australia Limited t/as NRMA Insurance
MEMBER:	Terence O'Riain
DATE OF DECISION:	18 April 2023
CATCHWORDS:	MOTOR ACCIDENTS - Motor Accident Injuries Act2017; section 7.36(1); claims assessment; damages claim; liability wholly admitted; serious frank injuries; motorcycle; combination of psychological and functional disability; non-economic loss; past loss of earnings; future loss of earning capacity; earning capacity assessment; loss of opportunity; loss of opportunity to grow established business; theoretical earning capacity where low reasonable prospect of obtaining work to utilise it; credit; request to make adverse inference because claimant did not provide evidence regarding recent unrelated psychological injuries to medico-legal psychiatrist; asked to make adverse findings on credit due to initial instructions to forensic accountant were shown to be wrong; Stevens v DP World Melbourne Ltd considered on credit and alternative reasons for claimant’s inconsistent statements; forensic accountant reports proposed alternative methods to calculate loss; replacement labour cost; Husher v Husher considered; add back business expenses to show claimant’s earning capacity; experts questioned together; replacement labour cost and buffer for loss of opportunity applied; hours at work disputed; Mead v Kerney considered; residual earning capacity; most likely future circumstances; evidence; witness; interest; legal costs; Personal Injury Commission Rules 2021; Malec v JC Hutton and Wallace v Kam followed; Luntz, Assessment of Damages for Personal Injury and Death, 5th Edition (2021) LexisNexis considered; assessment of damages for personal injury and death; Held – claimant a credible witness; suffered economic loss; damages assessed at $1,956,190.
DETERMINATIONS MADE:	CERTIFICATE OF DETERMINATION Issued under s 7.36(1) of the Motor Accident Injuries Act*2017* *Assessment of Claim for Damages* 1. The insurer admits it owed a duty of care to the claimant, breached that duty of care, and the claimant sustained injury loss and damage as a result of that breach of duty. 2. Under sub-sections 7.36 (3) and 7.36 (4) of the Motor Accident Injuries Act2017 (the MAI Act), I assess the amount of damages for this claim as $1,956,190. 3. The amount of the claimant’s costs, considering the amount of damages assessed in respect of this claim and in accordance with the MAI Act, is $182,275 inclusive of GST.

REASONS

INTRODUCTION

On 17, 18 and 25 October 2022, I assessed Stephen Betteridge’s (the claimant) claim for damages arising from the motor vehicle accident on 30 June 2018 (the accident).

Jurisdiction

The Personal Injury Commission Act 2020 (the PIC Act) established the Personal Injury Commission (the Commission) on 1 March 2021.
I am a Member and decision-maker of the Motor Accidents Division of the Commission.
Mr Betteridge’s application to assess damages is made under the Motor Accident Injuries Act2017 (the MAI Act). The Commission will decide the amount of damages in accordance with the PIC Act, the Commission's rules and any relevant provisions of the MAI Act.
Mr Betteridge served his claim for common law damages under s 6.14 of the MAI Act within three years of the accident, and the insurer admitted breach of duty of care in an
s 6.20 notice.
The objects of the MAI Act set out in s 1.3(2). The MAI Act seeks "the early resolution of motor accident claims and the quick, cost-effective and just resolution of disputes” and “to provide early and ongoing financial support for persons injured in motor accidents".
Section 1.3(4) says a decision maker should promote the objects of the MAI Act when interpreting those provisions.
Section 1.3(5) provides that the decision maker must act in a way that promotes the objects of the MAI Act when exercising an MAI Act discretion. Part 5 of the PIC Act enables the Commission to make rules regarding the Commission’s practice and procedure. This includes panel proceedings reviewing Merit Reviewers’ or Medical Assessors’ decisions.[1]
[1] Section 41(2) of the 2020 Act.
Section 3 sets out the objectives of the PIC Act and includes ensuring the Commission’s decisions are timely, fair, consistent and of a high quality. It also enables the Commission to decide matters justly, quickly, cost-effectively and with as little formality as possible.
Section 4 of the PIC Act echoes ss 1.3(4) and (5) of the MAI Act and requires exercising the powers and discretions to promote the PIC Act.
Section 42(1) of the PIC Act and the Commission rules contain the Commission’s ‘guiding principle’. The section requires the Commission to facilitate “the just, quick and cost-effective resolution of the real issues in the proceedings.”
Section 42(2) requires the Panel to give effect to the guiding principle when exercising any power given to a decision-maker under the PIC Act or the rules.
The rules of evidence do not apply to this assessment. I may look into any matter relevant to the issues in dispute in such a manner, subject to providing procedural fairness to all the parties.

BACKGROUND

On 30 June 2018, at approximately 12:30 pm, Stephen Betteridge was alone, motorcycling north on the Princes Highway at Narooma on New South Wales Far South Coast. He was approaching Riverside Drive.
A Subaru Forester pulled out of Riverside Drive on his left. Mr Betteridge attempted to brake and drop a gear to achieve an emergency stop to avoid the collision, but his bike fell over on his right side, breaking his right leg, injuring his right knee and grazing his right side, arms and hands.
An ambulance took Mr Betteridge to South East Regional Hospital at Bega. The trip was over one hour. His injuries were too serious to treat in Bega, so the authorities transferred him to Canberra Hospital via a stop at Cooma Hospital. That trip would total about three hours of further driving.
He underwent operations at Canberra Hospital; then he returned back to Bega to recuperate with medical care. The Bega hospital discharged him on 19 July 2018.
Mr Betteridge claims he suffered the following injuries and disabilities:
(a)   comminuted proximal tibial plateau fracture;
(b)   mildly displaced tibial plateau fracture;
(c)   mildly displaced fibula head and neck fracture;
(d)   injury right side of the neck;
(e)   right shoulder tear of the supraspinatus tendon and sub- scapularis tendon;
(f)    SLAP tear of glenoid labarum;
(g)   right side wound;
(h)   right foot arch pain;
(i)    depression;
(j)    anxiety;
(k)   post-traumatic stress disorder;
(l)    headaches;
(m)     discolouration around the right knee;
(n)   deformity of the area surrounding the right knee;
(o)   scarring right knee;
(p)   constant joint pain right knee, including burning;
(q)   right knee instability;
(r)   lymphoedema wound and scar management;
(s)   right knee restricted movement;
(t)    pain and discomfort aggravation on uneven surfaces;
(u)   aggravation when walking;
(v)   shin splints increase pain and discomfort during the work day;
(w)     pins and needles from right knee to ankle;
(x)   painful right side of neck;
(y)   painful right shoulder;
(z)   restricted neck movement;
(aa)   restricted right shoulder movement;
(bb)   pain and discomfort when sitting;
(cc)    pain and discomfort when driving; right shoulder, neck, knee, foot and ankle;
(dd)   aggravation leading to severe headaches;
(ee)   neck "crumbling sensation";
(ff)   prolonged use and reaching aggravate all injured body parts;
(gg)   right shoulder loss of strength;
(hh)   sitting or standing aggravates pain;
(ii)   pain when squatting;
(jj)   pain when kneeling;
(kk)    right thigh infection;
(ll)   right thigh blisters;
(mm)orthotics for the right foot;
(nn)   an operation to remove right leg hardware and need for eventual knee replacement;
(oo)   cellulitis and infection in operative wounds requiring hospital treatment and high-dose antibiotics;
(pp)   persistent swelling in right foot and ankle;
(qq)   anxiety;
(rr)   uncertainty regarding work issues;
(ss)    he has a necessity for medication, physiotherapy and psychological counselling;
(tt)   Mr Betteridge experiences loss of confidence, pain and worry about his right knee, which requires medication, rest and avoiding walking on uneven ground. This and the loss of capacity to kneel impact adversely on plumbing work;
(uu)   his right neck and shoulder require physiotherapy to relieve tension and pain. It requires four to five sessions to achieve this every three to four weeks;
(vv)    Nerve damage has caused pins and needles and, alternatively, numbness in the right lower leg, and
(ww) psychological conditions require counselling and medication.
Mr Betteridge was turning 45 years old when the accident happened.
He had grown up on Sydney's northern beaches and started a plumbing apprenticeship at the end of year 10 in 1989.
Mr Betteridge gave a history to Dr Peter Gray, recorded in his report dated 3 May 2022,[2] that when he finished his apprenticeship, he travelled and worked in northern Australia, where he participated in teaching and training Indigenous plumbers. He returned to Narooma in 2004, where he started his own plumbing business, Betteridge & Sons.
[2] AD25, 2.6.
With the help of employees and sub-contractors, his company serviced a large area of the South Coast from Batemans Bay to Eden, Jindabyne, Queanbeyan and back to Batemans Bay.
He told Dr Gray he usually worked more than 40 hours per week, and as reaching the job sites included travel, sometimes he worked 50 to 60 hours.
He was responsible for quoting, supervising employees and administration, as well as working “on the tools” i.e. he conducted his plumbing work as well as supervising staff.
Although he had done construction work in the last 8-10 years, he had moved towards maintenance and plumbing work, that let him spend less time on administration and more time on the tools. Before the reorganisation, his business had employed four plumbers full-time and a roofer but admits he needed to make more money.
Mr Betteridge, with advice from his accountant, restructured the business in 2016 to improve profitability. The forensic accountant reports address that restructure.

Preliminary conferences

There was an initial teleconference on 15 September 2021, where the parties stated there were outstanding medical reports and particulars of the claim. As the matter was not ready to proceed, a further teleconference was listed for 18 November 2021.
At the 18 November teleconference, the financial records, particulars of the claim and medical reports were still outstanding. However, the parties submitted the matter could be made ready for assessment, so a timetable was set down for the claimant to complete his evidence by 30 November 2021 and for the insurer to provide its proof by
17 January 2022. I gave leave for the parties to agree on a timetable if they could not comply with that timetable.
The assessment was fixed for 8 February 2022 as a Teams conference, allowing 3-4 hours to complete the assessment.
However, there were still outstanding reports, and the insurer needed to be able to instruct its legal representatives in time to proceed on the date fixed.
I directed the insurer to contact the claimant’s representative and to lodge a memorandum in the portal to confirm whether the matter could proceed on the date fixed.
As the assessment could not proceed on 8 February 2022, a further teleconference occurred on 22 February 2022. Mr Heazlewood of counsel appeared for the claimant.
The claimant stated he had served all economic loss documents he proposed to rely upon and provided agreed directions.
The claim was set down for assessment on 17 May 2022. The parties proposed that the matter would take all day to complete the hearing. However, later the parties sought an additional day for the assessment.
Shortly before the assessment conference on 17 and18 May, 2022 the claimant requested a directions hearing to vacate the assessment because the insurer opposed admitting recent medical reports.
The fifth teleconference occurred on 22 May 2022, with Mr Roberts SC appearing for the claimant.
The insurer submitted it had no opportunity to meet the issues raised in Dr Gray’s report; this physical assessment found that the claimant's knee condition may deteriorate to the point where it may impact his future economic and non-economic losses.
The claimant also underwent knee surgery in January 2022 and suffered a severe infection due to the surgery, which may also impact future treatment options.
The insurer’s most recent examination was via telehealth with Dr Robin Mitchell in April 2022. Unfortunately, the outcome of that report did not match Dr Gray's findings regarding future prognosis and ongoing impact on work capacity, pain, and suffering.
Further, the claimant recently served material regarding the claimant's future economic loss and the state of his business. As a result, the insurer required adequate time to address the claimant's expert’s findings.
This is a complex matter, where there are considerable divergences on the value of future economic loss and non-economic loss and how compensation should be calculated.
For the reasons above, there was considerable utility in vacating the assessment conference on 17 and 18 May 2022 for, following reasons:
(a)   allowing the insurer the opportunity to obtain up-to-date medical reports based on physical examination;
(b)   allowing the parties to finalise their cases regarding future economic loss;
(c)   arranging at least one day of in-person assessment to address matters of credit, and
(d)   The parties’ financial experts could give evidence jointly to explore agreement and clarify points of contention in their findings.

Although this would cause a further delay in resolving Mr Betteridge's claim, he instructed counsel to seek an adjournment. The insurer did not oppose vacating the assessment.

I vacated the teleconference on 17 and 18 May 2022.
I directed that no later than 27 May 2022, the parties were to provide a jointly proposed timetable setting out the further medical and financial reports for service, a date for a proposed teleconference to ensure that preparation is complete, and a range of dates regarding the availability of counsel and for the expert witnesses to attend.
Proposed directions regarding the attendance of the financial experts were to observe Procedural Direction PIC4 – Expert Witness Evidence.
I noted that the insurer sought the claimant, his partner and the financial experts for questioning. The parties sought a face-to-face hearing.
Eventually, the parties provided a timetable in this matter. It was set down for assessment on 17 and 18 October 2022 at the Commission's premises at 1 Oxford Street, Darlinghurst. There was an additional day on 25 October 2022.

Issues to decide

Agreed points

The insurer has conceded Mr Betteridge’s entitlement to non-economic loss and entitlement to the other heads of damage claimed, namely past and future loss of earnings and earning capacity under s 4.5(1)(a) of the MAI Act and damages under
s 4.5(1)(d).
The issues in this case are quantum of the non–economic loss, past economic loss and ongoing impairment to his earning capacity under division 4.2 of the MAI Act, which the parties agree will be productive of economic loss.
The parties provided accounting reports to assist the Commission in assessing these matters. However, the parties agree that there are various assumptions relevant to this assessment which an accounting report cannot fully encompass.
The parties agree about the accident circumstances. They also agree that Mr Betteridge suffered frank physical and psychological injuries.
There was also an exacerbation of psychological issues, which existed before the accident arising from his infant’s death, the stress arising from the deterioration of his marriage and the eventual marriage dissolution.
He also suffered other psychological impacts in early 2020 when he was first on the scene of a fatal accident on the Princes Highway near Narooma. He was also part of the community-wide psychological trauma the NSW Far South coast suffered during the late 2019 bushfires. These were still burning in January 2020.
Mr Betteridge had been operating a plumbing business in the region since 2004.
He is a qualified plumber and a roof plumber.
A roof plumber has specialist training in installing downpipes, rainwater tanks, and gutters on commercial and residential buildings. They are also experts in installing roof sheeting and cladding.
While regular plumbing considers the supply and drainage of water in other building areas, roof plumbing focuses on draining rainwater off a roof.
Furthermore, the requisite training of a roof plumber differs from that of an average plumber. A roof plumber needs more specialised training like heights training and stormwater training.
During 2016–2017 he restructured his business to use a product called the “App”.
Both parties agree he was working full-time at the time of the accident and has not returned to full-time work since that date.
Mr Betteridge was initially unable to work after the accident for approximately seven months.
He required further right knee surgery, including removing hardware in January 2022. This resulted in a wound infection, which set back his rehabilitation. He had not returned to work since March 2022, when the condition required intravenous antibiotics over six weeks.
But for the injuries, he received in the accident, his most likely future circumstances were that he would continue working as a plumber in his own business.
He does not claim superannuation losses.

Disputed points

The following issues are in dispute:
(a)   The damages quantum for non-economic loss, past economic loss and future loss of earning capacity.
(b)   Whether the psychological conditions Mr Betteridge already suffered, as well as traumatic events in 2019 and 2020, should be considered as overriding the psychological trauma from this accident.
(c)   The impact of his former employed plumber, Mr Tony Good leaving Mr Betteridge's business in 2017 and setting up his own plumbing business in opposition.
(d)   The impact of the 2019–2020 bushfires on Mr Betteridge's business.
(e)   The cost of employment of subcontractors as replacement labour.
(f)    Matthew Parsons was apprenticed to Mr Betteridge at the date of the accident. He is Indigenous, and the Aboriginal Training Program (ATP) paid a grant to support his training and employment. However, it was initially claimed that money paid to Mr Betteridge's business for training local Indigenous apprentices was reduced because Mr Betteridge was unable to provide mentoring and training due to his injuries.
(g)   Whether employing his son Alby—still in school at the time of the accident—in the business was brought forward because Mr Betteridge was injured.
(h)   Whether the average business earnings should be based on an average of financial years since 2014 or since the business reorganised after 2016 and based on an average of financial years 2017–2018 or only 2018.
(i)    Whether monetary impact should be measured by Annual Business Income (ANBI) or replacement labour costs.
(j)    If I base the loss on replacement labour costs, should I include a buffer for the loss of opportunity to grow the business?
(k)   The COVID-19 pandemic's impact on business.
(l)    Whether Mr Betteridge worked 60 hours per week (as claimed in some of the documentation) or a mix of hours, which can be averaged to a reduced, albeit substantial figure.
(m)     Whether Mr Betteridge’s injuries and incapacity created a need to employ office staff to perform administration duties.
(n)   Whether it is a realistic claim that Mr Betteridge could have worked until he was seventy, but for the injuries and ongoing disabilities.
(o)   There is disagreement about what vicissitudes discount should apply. The insurer relies on Mr Betteridge’s past medical complaints and treatment to justify a value greater than 15%.

To assess the economic loss, I must consider the following:
(a)   Whether Mr Betteridge can establish that the most likely circumstances around the time of the accident and subsequently would be that he would have grown his business and the amount of his loss;
(b)   the extent of Mr Betteridge’s residual earning capacity, i.e., whether the insurer has satisfied me that Mr Betteridge has residual earning capacity to offset his loss of capacity, and
(c)   whether I can calculate Mr Betteridge’s loss at a weekly rate, or whether a compensatory buffer would be appropriate, or a combination.
Mr Betteridge was forty-nine on the assessment date, with a life expectancy of 34 years.
It was over 225 weeks when the assessment hearing was completed; it is now almost 247 weeks since the accident,
Mr Betteridge claims s 4.5(1)(d) MAI Act damages for income tax paid on any statutory benefits.

Documents considered

I have noted the documents provided in the application and the reply and any further information provided by the parties:
(a)   Dr John McKee’s general surgeon report dated 23 March 2020;
(b)   Dr Chris Canaris's psychiatric report dated 7 July 2021;
(c)   Dr Jason Beer's podiatrist report dated 11 June 2021;
(d)   Dr Jonathan Negus orthopaedic report dated 3 June 2021;
(e)   Ms Natala Cogger occupational therapist report dated 23 August 2021;
(f)    Dr Robin Mitchell occupational physician report dated 26 March 2021;
(g)   Bega–South East Regional Hospital clinical records;
(h)   claimant’s statement dated 25 February 2021 and supplementary statements;
(i)    Dr Jason Beer’s supplementary report dated 25 March 2022;
(j)    Dr Robin Mitchell’s report dated 12 April 2022;
(k)   Dr Peter Gray’s orthopaedic report dated 3 May 2022;
(l)    Application for personal injury benefits;
(m)     Application for damages under common law;
(n)   NSW Police report;
(o)   NSW Ambulance report;
(p)   claimant’s damages summary;
(q)   Dr Anthony Smith’s orthopaedic report dated 8 September 2020;
(r)   Dr Leon A Le Leu occupational physician’s reports dated
20 December 2020 and 21 January 2021;
(s)   photo of the claimant’s injury to his right leg;
(t)    various certificates of capacity/fitness from Dr Paul Barnett, general practitioner (GP);
(u)   Certificate of Capacity/Fitness dated 11 July 2018 from Dr Stephanie Jones, GP;
(v)   various reports from On Track Occupational Therapy and Rehabilitation (On Track);
(w)     OT recommendations for the claimant from Brodie Murray OT of the Bega Community Health Centre;
(x)   X-ray and CT of the right knee and Tibia/Fibula dated 30 June 2018;
(y)   psychologist report dated 4 February 2020;
(z)   On Trak Occupational Therapy approval from Dr Paul Barnett dated
16 March 2020;
(aa)   Allied Health Recovery request from Narooma Physiotherapy Centre dated 23 August 2018;
(bb)   referral for an MRI of the right shoulder
(cc)    letter from Canberra Hospital to physio dated 20 August 2018;
(dd)   referral from Dr Paul Barnett to Narooma Physiotherapy Centre dated
15 August 2018;
(ee)   referral from Dr Jacintha Kannairan to Danny Stuart, physiotherapist dated 3 August 2018;
(ff)   physiotherapy referral from Canberra Hospital dated 20 August 2018;
(gg)   MRI of the right shoulder report dated 14 September 2018;
(hh)   X-ray of the right hand report dated 13 September 2018;
(ii)   X-ray orbit report dated 13 September 2018;
(jj)   referral from Dr Paul Barnett to Dr Krishnankutty Rajesh dated
26 September 2018;
(kk)    referral from Dr Paul Barnett to Mr Christian De Brennan dated
11 October 2018.
(ll)   GP Mental Health Care Plan (2710);
(mm)GP Mental Health Plan;
(nn)   response to Bega Valley questionnaire dated 25 October 2018 from Dr K R Rajesh dated 25 October 2018;
(oo)   Dr Rajesh’s report dated 25 October 2018;
(pp)   Mr Christian De Brennan’s report dated 21 November 2018;
(qq)   X-ray of the right knee and tibia/fibula report dated 30 June 2018;
(rr)   referral from Dr Paul Barnett to NJF (exercise physiology) dated
21 November 2018;
(ss)    Allied Health Recovery request dated 2 November 2018;
(tt)   Rehabilitation progress report no. 2 dated 11 January 2019 from On Track;
(uu)   Allied Health Recovery request dated 17 January 2019;
(vv)    Ultrasound – bilateral ankles and feet dated 31 January 2019;
(ww) attendant care request dated 4 March 2019;
(xx)    Allied Health Recovery request dated 4 April 2019;
(yy)    Allied Health Recovery request dated 7 August 2019;
(zz)    attendant care request dated 30 October 2019;
(aaa)referral from Dr Paul Barnett to Mr Jason Bruce dated 24 October 2019;
(bbb)suitable duties plan no. 10 from On Track dated 7 April 2020, and
(ccc) Pambula District Hospital discharge summary.
Clinical records from the following;
·Narooma Physiotherapy;
·Mr De Brennan;
·Dr Paul Barnett;
·Moruya District Hospital;
·Canberra Health Services;
·On Track, and
·Lisa Kempster.
United Legal instructed Chris Katehos (CK) to prepare reports for Mr Betteridge.
Hall and Wilcox Lawyers instructed Matthew John Gwynne (MJG) to prepare financial reports for the insurer.
Mr Katehos prepared three reports for the claimant:
(a)   report dated 30 November 2020 (CK1);
(b)   report dated 20 December 2021 (CK2), and
(c)   report dated 11 July 2022 (CK3).
Mr Gwynne prepared three reports for the insurer:
(a)   report dated 6 April 2021 (MJG1);
(b)   report dated 6 March 2022 (MJG2), and
(c)   report dated 20 June 2022 (MJG3).
Mr Katehos and Mr Gwynne jointly authored a report dated 21 October 2022, which set out their joint calculations of past and future economic loss up to 31 October 2022. The parties tendered at the assessment hearing on 25 October 2022.[3]
[3] AD32 21 Oct 22 signed Betteridge joint expert report.
Both experts have read the "Procedural Direction PIC4 Expert Witness Evidence Direction" of the Commission and agree to be bound by it.

EVIDENCE

Stephen Betteridge’s statement 25 February 2021

Mr Betteridge describes his right knee as his most pressing physical issue.
As soon as he rises and puts weight on that body part it burns. This can ease when he warms up, but he is never pain-free. He also has permanent ankle pain, which wintry weather aggravates.
Sitting and standing bring on pain. He cannot kneel or move easily on uneven ground, which impacts plumbing work.
To get to sleep he requires pain and anti-inflammatory medication each evening and morning. The pain sometimes wakes him.
He has undergone surgery to insert and remove titanium bands on each side of his right tibia with screws. That surgery resulted in emergency admissions to the hospital to treat infection and cellulitis with intravenous antibiotics.
Although he has had knee surgery, that body part is "definitely stiffer". It will require total knee replacement and rehabilitation in the future.
He has constant pins and needles or numbness in his right lower leg with a tingling sensation upon touch. He describes a "floating foot" due to nerve damage.
His right shoulder is his next problem, with pain projecting into his neck. He treats it in four weekly cycles, attending the physiotherapist with four to five sessions to treat the pain until it reappears after a further month.
Psychologically, he requires antidepressant medication, although he was taking that after his marriage broke down and continued to use the same drug.
He suffers from post-traumatic stress disorder symptoms. If he hears a motorbike or loud noise or experiences a near miss on the road, the fear severely affects him, and he has to compose himself. This happens consistently each week or fortnight. Passing the accident scene also provokes this feeling. This happens at least daily, as it is on the Princes Highway, Narooma’s thoroughfare.
Post-traumatic stress disorder impacts when dealing with stressful situations. In early 2020 he was the first responder to a head-on collision on the Princes Highway with two deaths. Attending that accident has brought flashbacks from his accident so he constantly replays the scene in flashbacks. He has felt more anxious on the road after the subject accident.
Before the accident, he had been the first responder to several serious accidents, and he had never been affected like that before.
He constantly second-guesses himself on the most trivial matters, including performing simple tasks like changing a tap washer.
He has a reduced capacity to concentrate. This has impacted his retraining for work.
The post-traumatic stress disorder and anxiety leave him awake at night, which will persist for days. Sleep deprivation affects his ability to concentrate and cope. In addition, he feels the fatigue is making him intolerant and that has led to conflict with employees and others.

Treatment

On Track Occupational Therapy (On Track) was his rehabilitation provider.
On Track supplied wheelchairs and other mobility aids so Mr Betteridge could take care of his personal needs. After he left hospital, he was in a wheelchair for about three months and on crutches for another six months.
He was unable to look after himself. He needed three months full-time care and lived at his partner’s home during this period.
Rachel Hay represented On Track in all Mr Betteridge's interactions with that service. This included supplying domestic services and equipment to assist Mr Betteridge at home and efforts to obtain reemployment. The reports she authored accurately report his disabilities.
By early 2021 Mr Betteridge could work up to 21 hours a week, three days seven hours a day.
Ms Hay was helping Mr Betteridge investigate water waste management as an alternative to his previous employment. Before the motor accident, Mr Betteridge had been servicing Biolytix systems and was an accredited service technician for over 12 years. He had a good understanding of the systems, and requirements of installation and servicing.
His business has been servicing approximately one hundred systems a year in the region from Milton, NSW down to the Victorian border. The goal of the additional training was to enable him to do the sales, design and quote for the systems.
Mr Betteridge was also seeing Lisa Kempster every four to six weeks for psychological counselling. In addition, he saw his GP each month for review and prescriptions. He also sees his treating orthopaedic surgeon.
Until the insurer ceased funding the treatment, Mr Betteridge would have a regular remedial massage to his right knee once or twice a week. The funding for treatment ended in mid-2020. The insurer also ceased funding On Track around the time of this statement. He was to begin seeing an exercise physiologist because by
February 2021, he had gained 40kg since the accident.
Mr Betteridge confirms that Dr McKee's report dated 23 March 2020; Dr Le Leu’s report dated 6 December 2020; and Dr Smith’s report dated 8 August 2020 were accurate, except for Dr Smith's references to ongoing back problems.

Economic loss

Mr Betteridge could claim on an income protection policy after the accident. However, he expects to have to repay those benefits. He also received statutory benefits from the insurer as make-up pay.
His business name is Betteridge and Sons Pty Ltd, which operates through a family trust known as the Betto Boys Family Trust (the trust).
Mr Betteridge says he worked on average 60 hours per week doing the following:
(a)   plumbing and associated tasks, roofing, gas fitting and labouring;
(b)   quotations and estimates;
(c)   customer liaison;
(d)   attending worksites;
(e)   scheduling work and ordering supplies;
(f)    supervising staff and subcontractors;
(g)   on-call duties in emergency work, and
(h)   assisting with administration (e.g. invoicing).
Mr Betteridge accepts that the On Track report dated 10 October 2018, titled "Work Duties Assessment Report,” accurately details the distinct functions he performed in his business.
Before the accident, the business concentrated on government-subcontracted plumbing and maintenance work, including:
(a)   schools;
(b)   housing commission buildings;
(c)   Wallaga Lake Aboriginal Corporation, and
(d)   gas heater maintenance.
The area he worked in covered the South Coast to Queanbeyan.
Before the accident Mr Betteridge intended to:
(a)   increase his geographical presence for school maintenance work between Batemans Bay to Bega;
(b)   obtain more preventive work at schools, in addition to rectification work;
(c)   maximise business efficiency, and
(d)   acquire another apprentice.
Mr Betteridge claims that since the accident there was a downturn in his business, and his income reduced since the accident. However, he said then that CK1’s report dated 30 November 2020 accurately expresses the impact on his business and revenue.
In early 2021 Mr Betteridge stated that he was unable to work from the date of the accident until 3 March 2019 (approximately eight months). His leading subcontractor James Kite attempted to replace Mr Betteridge as a plumber but was unable to do roof plumbing.
There was an increase in available roofing work through a head contractor needing roofing repairs across the South Coast and Monaro. However, Betteridge and Sons could not accept that work while Mr Betteridge was concentrating on rehabilitation, and he had not hired a roof plumber who had his qualifications.
From January 2020, Mr Betteridge worked seven hours per day, three days a week.
He estimates that only a few hours were chargeable work in that period, and the remaining hours were spent on supervising and assisting tradespeople, site visits and non-chargeable administration.
At that time, because Mr Betteridge could not travel long distances, he could only attend on business within 30km of Narooma. This meant being only able to undertake one-third of the work available.
Around this time Mr Betteridge indentured Alby Betteridge (Alby) as an apprentice.

Mr Betteridge’s supplementary statement dated 18 November 2021

This statement deals with comments on the insurer's financial expert MJG’s report MJG1 and updates the earlier information.

Staffing Betteridge and Sons

Before the accident, the numbers of employees varied. In 2016 the business employed four full-time plumbers and a roofer. After 2016 Mr Betteridge concentrated on working on the tools. On 30 June 2018, the employees were apprentice Matthew Parsons with a regular subcontractor, Mr Kite. Mr Betteridge’s partner Samantha McCarthy undertook the administration.

Matthew Parsons

The business indentured Mr Parsons as an apprentice around 30 November 2017 and he stayed with the business until February 2019. After the accident, Mr Kite trained the apprentice. The NSW government funded part of Mr Parson’s apprenticeship with grants under the Aboriginal Training Program (ATP).
Mr Parsons wanted to play football at Queanbeyan in 2019 and gave notice at the beginning of that year.
A further Aboriginal trainee has been employed since January 2021 under the ATP.
The question of whether Mr Parsons leaving resulted in a loss to the business and whether there was a nexus with Mr Betteridge's injury is addressed in the financial reports from Furzer Crestani (CK reports) and the subsequent insurer reports on the same subject.

James Kite

James Kite started subcontracting for the business in mid-2016. After the accident, Mr Kite subcontracted on a full-time basis. The change of status resulted in the company paying Mr Kite superannuation, and holiday pay and incurring overheads.
Mr Kite still works full-time for the business.
The business turned down other jobs after the accident because Mr Betteridge could not do them. The company lost contracts such as the Tilba Cheese Factory maintenance work, which had been constant. The amount of work the business could take on shrank because the accident limited the amount of oversight and supervision Mr Betteridge could provide.

Alby Betteridge

At the end of 2017, Mr Betteridge's eldest son worked during the holidays as a trade assistant, and he returned to Narooma High School at the beginning of 2018. He also worked during the Easter 2018 holidays.
When Matthew Parsons gave notice, the business indentured Alby as an apprentice who worked under Mr Kite's supervision when Mr Betteridge was unable to attend work. Alby left the apprenticeship in December 2020.

James Keith

James Keith was a second contractor which the business employed between November 2019 and February 2020.

Tony Good

Mr Good is a qualified plumber and Mr Betteridge's friend who worked for the business between February 2007 until January 2017.
Although the insurer's reports suggest Mr Good setting up his own business would cause revenue loss after the accident, Mr Betteridge says Mr Good’s business concentrated on home maintenance and reservations. It was not in competition to obtain the type of business Betteridge and Sons performed.

Wendy Phillips

Ms Phillips was Mr Betteridge's former partner and mother of his three sons. She was on the books as an employee, which did not necessarily reflect the hours she may have worked in the business. The work she did was banking and recordkeeping, although Mr Betteridge says he did most of the administration before the 2016 restructure. Mr Betteridge says Ms Phillips’ performed less actual administration work and that his current partner works longer hours.

Caitlin Dobson

Caitlin Dobson performed banking and administration work, as well as invoicing. Her employment was about three days per week. However, Mr Betteridge terminated her employment in 2017 for performance issues.

Samantha McCarthy

Ms McCarthy, Mr Betteridge's current partner, was working three days a week for another business and one day a week on administration and billing for the company when she started in 2016. That increased to permanent part-time two days per week and from March 2017 to 20 hours a week, which increased to 30 hours a week in March 2018.
The administrative work changed when Spotless became the head contractor for school maintenance work in July 2018. In addition, the organisational demands increased due to billing method changes.

Betteridge and Sons business restructure

In 2016 on his accountant's advice, Mr Betteridge restructured the business. He acted on the advice that if he were to do more work on the tools, then the business would be more profitable.
To facilitate this, the business used a product known as "the App".
More administration was necessary using this product, but it could free Mr Betteridge to do more chargeable work.
The App enabled more accurate job recording and invoicing.
Before the restructure, the business handled plumbing and maintenance work for the government with commercial and domestic work for private clients.
The restructure required focusing on the maintenance of government facilities rather than domestic or construction plumbing. The change in emphasis meant reduced overheads.
At the time of the accident, the business changes had made a positive difference, and
Mr Betteridge says he was totally debt free.
The statement says that before the accident, he was "not working regularly documented hours… But it would vary". He estimates that he rarely worked less than 40 hours a week and more often more than 60 hours per week.
Since the accident, Mr Betteridge tried diverting his business into selling, installing and maintaining environmentally friendly wastewater treatment tanks. Biolytix is the brand name. Mr Betteridge imported these from New Zealand. The late 2019 and 2020 bushfires created demand as people needed to replace these tanks due to damage.
Due to a misunderstanding about the cost of importation, this work was not profitable.
Recently the company has approached Mr Betteridge to gauge his interest in returning to this work, including being the New South Wales distributor.
He now does not feel physically able to conduct the installation due to the impact of his injuries.
Mr Betteridge’s business has employed a subcontractor named Leon Irving to conduct any remaining Biolytix work because Mr Betteridge cannot do this work.

Bushfires

The insurer's financial reports claim that the bushfires in late 2019 and 2020 on the south coast would have caused a decline in the business anyway.

Mr Betteridge says that bushfires have created opportunities for replacing plumbing infrastructure. However, local tradesmen are unable to cope with the demand. But for the accident, Mr Betteridge would have taken advantage of that demand.

COVID-19

Mr Betteridge observed that there was abundant work available during the pandemic. He noted that rental property owners brought forward renovations as well as government giving grants for renovations and extensions. He was unable to accept these opportunities due to his accident-related injuries.

Present health condition

At the date of this statement, he noted:
(a)   pain and discomfort in the right knee increased exponentially during winter 2021;
(b)   his knee would either lock up or give way, which reduced his mobility;
(c)   he would treat that with strapping, ice and rest daily during winter, but that had reduced to a couple of times a week;
(d)   pain is constant in the knee at a higher level;
(e)   he was restricted to 12 hours on all duties per week;
(f)    he worked four hours a day on Monday, Wednesday and Friday, sometimes with difficulty, and
(g)   takes Palexia (an opioid) as the pain gets worse.
In March 2021, the insurer ceased paying for physiotherapy, and Mr Betteridge has continued to seek that treatment at $120 per consultation. Sometimes he seeks weekly treatment when pain is at its worst, otherwise it is at least once per month.
Narooma physiotherapy also treats his neck, shoulders and lower back.
Mr Betteridge has the following symptoms:
(a)   suffers mental issues and lack of sleep;
(b)   feels depressed due to not being able to work or do enjoyable things anymore;
(c)   he has experienced a loss of confidence and the sense of his competence;
(d)   he does not feel like the same person;
(e)   he has trouble concentrating and focusing;
(f)    he feels sore and grumpy;
(g)   he lacks energy;
(h)   he feels pessimistic and has a loss of pride;
(i)    he has reduced strength and fitness;
(j)    he is unable to surf, coach or referee rugby;
(k)   he is hypervigilant on the road and hates driving past the accident site, which he must do daily;
(l)    his loss of focus means he is unable to take on sophisticated plumbing tasks, and
(m)     he is reluctant to socialise and has reduced family and friendship connections.

Mr Betteridge’s supplementary statement dated 12 July 2022

This statement updated previous statements and responded to MJG2.
The insurer instructed Matthew John Gwynne of PKF Forensic Accountants to provide a calculation of replacement labour based on 38 hours per week.
However, Mr Betteridge repeated his assertion that his usual work hours were 60 hours per week, the working hours being between sunrise to sunset, Saturday mornings in winter, all Saturdays in summer and callouts on Sunday.
Mr Gwynne had included four weeks’ holidays in his calculations. Mr Betteridge disputes including vacations in these calculations because the only holidays he took were three-day motorcycle rides, including the weekend.
He had hired subcontractors when they were available, and the subcontractors expect to receive up to $77 per hour, which had previously been $66 per hour.
Mr Kite was receiving $60 per hour plus overheads, but he wants to go into different work. So the business is increasing that hourly rate to attract him to stay on.
Although Mr Gwynne repeats in that report that the business would lose work due to
Mr Good leaving in January 2017, Mr Betteridge says they do not compete in the same market. Only seven out of 130 contracts appeared to go to Mr Good when he left.
The supplementary statement also clarified contracting changes between Joss and Spotless. The facility management work was for "reactive maintenance,” i.e. emergency callouts, "planned works,” which is construction, and "demountables contract". Joss retained the latter two types of work, and Spotless took over the callout work. His business still did Joss's work. Due to the motor accident, he did not submit the Spotless tender response until late in November 2018. The application was successful. The financial year before the accident was particularly good for government contracts. This was due to funding for roof replacement in schools. The business could not do that work after the accident. This was the reason for the revenue reduction.
Mr Betteridge's work hours he dropped to 12 hours per week before the surgery to remove hardware removal and infection. He could not install plants and heavier work. He sometimes transports equipment on trailers to jobs and undertakes supervision. He cannot perform at the level of a trade assistant.
At the time of the supplementary statement, Mr Betteridge had not returned to work since the operation.
He requires regular blood tests, and his leg swells and turns red when he exerts himself.
His right knee feels as if it could lock or give way. He has to avoid the rough ground. He has strange sensations below his knee, with his quadriceps and hamstrings feeling switched off. He has a sense of spiders running up and down his shins.
The way to avoid pain is to do as little as possible or use an opiate-based medication. These drugs have significant side effects including constipation, libido loss, motivation loss, stimulated appetite and addiction problems.
He takes fourteen doses of slow-release opiates per week with a further 14 to 20 instant-release lower doses. It leaves him doped out and reduces his cognitive abilities and motivation. He cannot drive a car when he uses that medication, and he needs to take pain drugs to be able to go on a more extended trip. He also takes other medications to deal with inflammation and pain.
He had just returned to swimming three days a week and swam twenty laps each time. When he does not swim, his neck, lower and right shoulder pain worsens.
He rides his bike once or twice a month for an hour or two. He avoids going to the beach as the sand stirs up his lower leg.
He still needs psychological treatment and is spending his money to continue physiotherapy. In addition, he still needs medication to deal with his post-traumatic stress disorder and depression. Weight gain is a medication side effect, as well as forced inactivity.
His income support has ceased, and he is spending his savings.
He is irritable and has become harder to live with, but he is confident his relationship with Sam McCarthy is solid and happy. In addition, his relationship with his children is close.

Chronology

Mr Betteridge provided a chronology, which highlights these relevant factors:
(a)   Alby, Mr Betteridge's oldest son, was 16 years old at the date of the accident. He was seventeen when the business apprenticed him as a plumber in March 2019;
(b)   In mid-2006 Mr Betteridge's youngest infant son died at 11 days old.
Mr Betteridge required counselling and medical treatment to recover from reactive depression;
(c)   in 2010 doctors found Mr Betteridge has bilateral knee problems due to his long rugby career;
(d)   in September 2017, Mr Betteridge started to receive psychological treatment following his marriage breakdown in November 2016;
(e)   Mr Betteridge took on Matthew Parsons as an apprentice in late November 2017, backed by a New South Wales government employment pilot scheme. The scheme was to subsidise the company to employ Mr Parsons;
(f)    the accident occurred on 30 June 2018, and it was not until late
August 2018 that Rachael Hay assessed Mr Betteridge's activities of daily living;
(g)   on 26 September 2018, after Mr Betteridge was able to move home from Ms McCarthy’s home, but he was still on crutches. Ms Hay then assessed his pre-accident work duties to establish a baseline for rehabilitation;
(h)   Mr Betteridge was able to attempt weight-bearing in October 2018, although he still suffered an infection in his right thigh. In the same month, an orthopaedic assessment found the motor accident-related right shoulder injury, and he lodged a request for psychological treatment arising from the accident. Mr Betteridge sought podiatry and exercise physiology assistance in the following months;
(i)    in February 2019, Matthew Parsons left his apprenticeship to play rugby league. To cover Mr Parsons’ departure the business indentured Alby Betteridge who worked under James Kite's supervision;
(j)    in early March 2019, Mr Betteridge gradually returned to administration work. On Track provided a suitable duties plan at four hours for three days the week. Three days per week proved to be too much and reduced to two days per week briefly;
(k)   in mid-June 2019, On Track provided vocational counselling, and Mr Betteridge increased his time at work to six hours a day, three days a week. He noticed that his right knee and shoulder pain increased shortly after he started to work those hours;
(l)    Mr Betteridge increased his hours so that by September 2019, he was attending work seven hours three days a week. Shortly after, one of those days was allocated to wastewater management systems training;
(m)     in November 2019, Mr Betteridge attempted plumbing work;
(n)   Mr Betteridge maintained three days a week at work and received rehabilitation until 30 May 2020, when his right leg gave way, and he developed severe back pain, which required a stay at Moruya Hospital;
(o)   Mr Betteridge's GP’s opined in mid-June 2020 that alternative duties in wastewater treatment operations and construction estimating could be suitable alternative duties up to 21 hours per week. Maintenance supervision would not be suitable;
(p)   suitable duties assessment supports staying at seven hours a day, three days each week but moving into wastewater management, and design work is subject to Mr Betteridge successfully training in AutoCAD design;
(q)   in December 2020, Alby Betteridge left the apprenticeship, and Gordon Campbell replaced him as an apprentice the following month. The New South Wales government scheme, which supported Mr Parsons's role applies to Mr Campbell's position;
(r)   in April 2021, Alby Betteridge returned as a casual employee;
(s)   in May and June 2021, increased knee pain reduced Mr Betteridge’s work capacity to four hours a day for three days a week. On 25 January 2022, the orthopaedic specialist removed the hardware from
Mr Betteridge's right leg. Still recuperating from the surgery, in March 2022 Moruya Hospital admitted him to intensive care with infection and cellulitis in the wound. The hospital treated him with intravenous and oral antibiotics.
The cellulitis has persisted.
During this period, Mr Betteridge saw several doctors, with orthopaedic surgeon Dr Powell examining him last on 27 June 2022.
Due to the infection, cellulitis and pain in his leg, he was unable to return to his physical rehabilitation, which included swimming in the local pool, until July 2022.

Insurer questioning Mr Betteridge

During the assessment starting on 17 October 2022, Mr Guihot asked Mr Betteridge questions regarding instructions he provided to Furzer Crestani’s Chris Katehos in CK1.[4]
[4] AD 25 items 3.1 to 3.3.
The forensic accountant recorded in the first report that Mr Betteridge told him money earned under the scheme supporting Matthew Parsons's apprenticeship ceased when Mr Parsons left the business in February 2019. The instructions Mr Katehos recorded was that Mr Parsons left because Mr Betteridge's injuries meant he could no longer supervise the apprentice.
Mr Guihot pointed out to Mr Betteridge that it was incorrect, as Mr Parsons left the business because he wanted to play professional rugby league in Queanbeyan, which is 2.5 hours’ drive from Narooma. The insurer had obtained stories from Queanbeyan media, which confirmed Mr Parsons signed to play with the Queanbeyan Blues for the 2019 season.
The insurer's report MJG1 dated 6 April 2021 addressed this. Mr Betteridge confirmed that was correct, and he had withdrawn that assertion.
Mr Guihot suggested in his questioning that Mr Betteridge had lied to support the claim for economic loss and rejected Mr Betteridge's response that it was an oversight. The insurer's case was that Mr Betteridge would not have corrected this aspect of the claim if the insurer's forensic accountant's report had not included the information about
Mr Parsons leaving town for another opportunity. Mr Betteridge denied this. He said he was ready to correct that impression when he became aware.
This was the basis of the insurer’s eventual submission that I could not accept
Mr Betteridge's evidence unless documentary evidence corroborated the claim.
Regarding Alby Betteridge's apprenticeship, Mr Betteridge’s answers to Mr Guihot's questions and the records showed that Mr Betteridge had employed Alby as a trades assistant during school holidays before the accident and always intended to apprentice his sons in the business as they finished year 12.
The questioning confirmed that the accident contributed to Alby leaving school before he finished year 12 to commence the apprenticeship. However, the insurer's view, based on MJG1, was that Mr Betteridge would have employed his sons in the business anyway, and it should not be a factor supporting the claim for economic loss.
Questioning on the number of hours Mr Betteridge claims to have worked in business before the accident confirmed there were no documents which recorded the hours spent on the business before the accident. Although Mr Betteridge said he did not know the insurer had requested those records on multiple occasions, he confirmed he could not provide a document which showed those hours. He denied he had just made up that figure to help his case.
Medico-legal specialist and orthopaedic surgeon Dr Peter Gray recorded in his report dated 3 May 2022[5] that Mr Betteridge told him he usually worked more than 40 hours per week and sometimes 50 to 60 hours if there was travel. Dr Patrick recorded similar times in one part of his report dated 15 December 2021,[6] but in other parts, he recorded Mr Betteridge telling him he would work longer hours as claimed.
[5] AD25 2.7.
[6] AD25 2.6.
Mr Betteridge told the insurer's counsel that he did not accept that what Dr Gray recorded was correct, because he does many callouts. From the questioning, I discerned that the 60 hours would include the driving to and from jobs, which is chargeable, but not work on the tools. This meant Mr Betteridge was solely responsible for after-hours and weekend callouts, which the business could not afford to delegate to employees or contractors.
Rachael Hay for On Track interviewed Mr Betteridge on 26 September 2018 to produce a report dated 10 October 2018.[7] Ms Hay titled the report a work duties assessment report and summarised how Mr Betteridge operated his business and his role within the business. Mr Betteridge incorporated these roles into his initial statement.
[7] AD25 2.8.
Mr Betteridge estimated that he spent 60 hours a week in the business, commencing most days 8:30 am and finishing at 6:30 pm spread over seven days.
He estimated he worked for 70% of that time as a plumber. This role requires him to walk and often stand on uneven ground. He also has to kneel, squat and stoop often, and climb on roofs and up ladders. The report also describes difficult and demanding work carrying tools, pipes, parts, fittings and maintenance equipment in wet and uncomfortable conditions. In addition, his work would involve him working under buildings, trenches and drains.
Mr Betteridge would spend twenty per cent of his week driving 50 to 200km daily to attend jobs. The injuries and resultant disabilities impact his capacity to undertake that task.
The remaining 10% of his work is administration, which he has primarily delegated to his partner Ms McCarthy.
The insurer's questioning clarified that Ms McCarthy’s worked on administration from 9:00 am till 3:00 pm, five days a week.
Mr Guihot questioned Mr Betteridge about what he had told doctors about when he returned to work and when he did start. Mr Guihot put to him that he had told
Dr Negus he did not return to plumbing until November 2019, when it was earlier than that, according to the medical certificates. Mr Betteridge said he did not remember exactly when he returned to work.
The insurer also asked why Mr Betteridge did not employ a roof plumber during the eight months following the accident to mitigate the loss of that work when his injuries made it impossible for him to do the job.
Mr Betteridge explained that he did not hire a replacement for his roof plumbing expertise because he was recovering from his injuries and did not have the "mental health space" to engage a roof plumber during that time. The business later hired a roof plumber.
Mr Betteridge agreed during questioning that he required counselling for his anxiety arising from the end of his marriage, as well as the motor accident-related injuries.
He also agreed he injured both knees in separate rugby incidents about ten years before the accident and bilateral ankle strain. In addition, from his past plumbing work, he injured his lower back lifting an object about 20 years ago.
Mr Betteridge expanded on the experience of the bushfires in late 2019 and 2020 on the south coast, as well being first on the scene at a double fatality at Bodalla on the Princes Highway.
During the bushfires around Christmas 2019, the danger forced Mr Betteridge and his family to evacuate their home to escape. The fires cut Narooma's power off, and
Mr Betteridge was very anxious.
He described attending the fatal accident and how both incidents required separate counselling attendances. As a result, he felt traumatised and unable to sleep. The bushfire-related counselling was part of a government-funded scheme for all of that area's residents because the trauma was community-wide, and not specific to Mr Betteridge alone.
Although Mr Betteridge worked three days per week in early 2020, lack of sleep made it difficult. He told Ms Hay this impact followed the bushfires and fatal accident. His GP prescribed medication to help.
The insurer raised a conference between Ms Hay and Mr Betteridge on
4 February 2020 (page 630, insurer's bundle). During the meeting they discussed whether wastewater management design and installation was a viable way for the business to mitigate the loss of plumbing work Mr Betteridge could no longer do. The insurer questioned why the company had not pursued wastewater management subsequently.
Mr Betteridge explained that even with help with the training and upskilling required to perform this work successfully, he could not manage the transition. He has only basic computer skills. He needs to be able to manage AutoCAD programming, which is mandatory for the design. Impairment from lack of sleep, and loss of ability to concentrate and retain information means he cannot complete the design work studies successfully.
The insurer put to Mr Betteridge is claiming he cannot do the work, but he is actually waiting for his insurance claim to resolve and then he will do that work.
Mr Betteridge denied that suggestion.
Mr Betteridge says that because his knee has deteriorated, he needs to reduce his hours of plumbing from the 21 hours weekly he was previously able to do since the accident. This deterioration means he cannot go on to sites, which are typically dug-up ground, with undulations, holes and building materials to step around or climb over and out of.
The insurer pointed out that Mr Betteridge did not tell Dr Canaris – the only psychiatrist qualified to assess the subject accident's psychiatric impact – how the bushfires and the fatal accident also impacted as stressors. Mr Betteridge agreed with that proposition.
The business was initially doing schools and government building maintenance work as a subcontractor for Joss Facility, and that contract switched to Spotless. The Spotless invoicing requirements imposed a more significant administration load on the business. The transition began in late April 2018 when Mr Betteridge learned Joss had lost the contract. It was in mid-November 2018 that the company secured a Spotless contract.

The mix of work changed as well. For example, the Joss work had been over 40% of the business income before the accident, but the same work plummeted in value in the following years.

Member’s questioning

I asked Mr Betteridge questions about whether he agreed plumbing is inherently risky. He agreed with that proposition because of the wet, cold, uneven ground, lifting, infections and minute work, which could adversely impact hands and fingers. He readily agreed that he may have retired early from the impact of plumbing, and not just because of this accident.
He said that at the time of the accident he weighed 105kg and now weighed 158kg due to the inactivity his injuries imposed. However, he had been physically active, enjoying the gym and surfing, rugby training as well as his work. He believes that activity would have helped him stay fit for his work as it was habitual and enjoyable, which he constantly intended to maintain.
He learned to surf when he was ten years old and accessed the water weekly outside his Narooma house. He has recently made several attempts to surf using a very buoyant beginners board, and it felt good, although he can only kneel on the board.
He enjoyed motorbike riding and used it as a stress relief from his work. He would go away for long weekends riding for enjoyment before the accident.
Before the accident, he was active in Narooma sports as an administrator, coach and trainer, especially rugby union.
He is taking steps to try to reduce weight using shakes as meal replacements.
Mr Betteridge told me that the pain and distress affects his sleep. He needs to take strong medication, or he will wake up. The medication makes him drowsy the next day. Treating doctors did not evaluate his sleep quality to see if the accident and weight gain were causing other problems.
Mr Betteridge told me that the App replaced job cards, and before, he would write his jobs on a whiteboard to help with the invoicing. The business had been all paper-based before adopting the App.
The App made it easier to record the hours spent on a job, although getting his employees to input the necessary information was difficult. The employees needed a hybrid system to enter work. The accountant provided software that made recording overheads on each job easier. His tradesmen would tell Ms McCarthy about the overheads, and she would input that information.
I asked him how the injuries and medications impacted his intimate life with his partner. He confirmed that the pain restricts him in the positions he could make love and that it was difficult.

Further questioning

Mr Betteridge's counsel asked him whether his pre-accident knee problems had stopped him from working in the five years before the accident. The answer was no.
Mr Betteridge also said that just before the accident, he was fitter than he had been as a 20-year younger plumber.
In respect of the changes due to the accident and the Spotless switch, Mr Betteridge was unable to work for the first six months after the accident, which led to him sending a tender to service fewer schools than he had previously serviced and reducing the geographical area for performing maintenance contracting. As a result, the business has less ability for dealing with weekend, and after hours callouts, also known as responsive maintenance, but can address planned tasks because they have more time to plan who will do it. The business still has to subcontract roofing work.
Mr Betteridge also confirmed that he charged clients for travelling to jobs, as that was part of the tender, or the travel cost was incorporated into any flat rate service fee for personal work.
Mr Roberts asked Mr Betteridge to explain the installation of organic waste systems and why the business had yet to pursue that work. He described a very intense and thorough, and labour-intensive process. Mr Betteridge says that he could not do the physically demanding work needed. Even if he were able to manage to learn AutoCAD, there would not be enough design work to sustain his involvement.
The insurer arranged a computer tutor to teach Mr Betteridge those skills, but it was unsuccessful. He did not have the basic skills to run the operating program. In addition, although Mr Betteridge could draw a plan on paper, but councils need applications for building approvals for installation in AutoCAD. Mr Betteridge thought designing and installing these systems would be an excellent alternate earner, and he was disappointed when he could not do it.
Mr Betteridge confirmed that in the 18 months after his accident and before the bushfires and the double fatality he attended, he was already having trouble with nightmares and other post-traumatic stress disorder symptoms.
These experiences in early 2020 made his psychiatric condition worse, but due to the treatment he was receiving, they are more consistent with his pre-2020 symptoms level. As he was already receiving treatment from the bushfires counsellor, he did not make a CTP claim for the later accident to pay for his counselling.
Mr Betteridge confirmed that there had been noticeable changes in the Narooma district due to wealthier people coming into the area, driving up prices combined with the bushfire damage requiring infrastructure replacement in people's homes and business premises. This created opportunities for the business. His business was able to serve existing customers but it could accept less opportunities due to his injuries.

Economic loss evidence

Kevin Donald – Director Effecto Pty Ltd (Tax Agents) statement dated 26 November 2021

At the time of his statement, Mr Donald had been the plumbing business’s accountant for 14 years.
Although the business ran successfully before 2016, Mr Donald considered that the business’s profitability could improve if Mr Betteridge directed his work to be on the tools and delegating the business administration tasks he had previously undertaken.
In 2016 Mr Donald introduced "the App”, among other changes. These changes increased profits.
Mr Donald confirmed that the bushfires in 2019 and 2020 caused a brief slump but quickly led to increased income. This was due to monthly sales almost doubling at once following the fires, plus providing multiple emergency fire response works to several customers at $9,000 each. This involved selling the water treatment units plus added installation costs.
The business employed Ms McCarthy in good faith and not as an income splitting measure. However, the company needed a large amount of administration due to the business changes.
Mr Donald calculated the percentage of labour costs to net profit between 2015 and 2020, showed a 10% increase between the financial years (FY) 2015 and 2017. This is because in 2016, the business employed added excavation and electrical works due to a particular job.
Mr Donald commented on the Aboriginal training grants but had not advised
Mr Betteridge on this aspect.

Summary Furzer Crestani forensic accountant report dated 30 November 2020 (CK1)

The claimant’s solicitors instructed forensic accountant Chris Katehos to produce a report calculating the economic loss Mr Betteridge has suffered due to the accident. It was based on Mr Betteridge’s instructions in telephone discussions with Mr Katehos.
Mr Betteridge's economic loss claim is based on the loss his business has suffered because Mr Betteridge says he was more than just a plumber. As the company ran during 2017–2018 he claims he performed the bulk of plumbing, which required skill and experience. In addition, he dealt with the following:
(a)   answering emergency callouts;
(b)   seeking new business and existing client relations;
(c)   business administration, including invoicing and collections, and
(d)   entrepreneurship and working on the company.
Mr Betteridge claims he was the driver of the business, and when he was unable to work at all or at a reduced capacity, the business suffered.
Mr Betteridge ran the business via a company, of which he was the sole director and shareholder. The company paid a trust, which distributed payments to trust beneficiaries.
Mr Katehos’ economic loss calculations were based on two scenarios relating to the claimant's estimated earnings from the business. In the first scenario, the accountant relies on the earnings from 2018 alone because there were changes and unusual payment patterns for the earlier three financial years. The second scenario is based on a combination of the 2017-2018 financial years averaged to calculate the true profits.
Each scenario would have three alternative outcomes relating to Mr Betteridge's actual retirement age as a result of the accident, namely his losses if he retired at 60, 65 or 70.
Mr Betteridge is the business's sole director and shareholder. Mr Betteridge confirmed he spent about 60 hours per week at his business before the accident. He estimated he worked about 70% of that time on chargeable work.
From January 2020 up to Mr Betteridge's operation in January 2022, he was working seven hours a day three days a week. Only three to four of those hours per week are chargeable.
In paragraph 7.10 (f), the accountant referred to Mr Parsons leaving.
If Mr Betteridge had not been injured, he expected to run the business with himself, a subcontractor and two apprentices, including Mr Parsons. Mr Betteridge says the business would have achieved earnings at least equivalent to the 2017 and 2018 financial years.
The report notes that in the 2015 and 2016 financial years, the business paid $106,000 in total wages to plumbers and labourers. After the restructuring in the 12 months before the accident, it had dropped to $24,000 annual total wages.
If Mr Parsons had remained with the business, the ATP would have paid his business a series of four biannual payments, averaging $41,690 per payment.
The company received two of those payments, but the claimant instructed that the third and fourth payments were not paid because Mr Parsons left the business, because he could not train him.
The claimant’s expert report relies on the High Court decision in Husher v Husher [1999] HCA 47 to lift the corporate veil to calculate Mr Betteridge's earnings before and after the accident.
The method used is to start with the trust’s trading results;
(a)   add back the claimant's gross wages, allowances and superannuation;
(b)   eliminate any internal entity transactions between the company and the trust, and
(c)   adjust for any business items that are not actually business-related to not reflect the commercial value of the transaction.
For example, it is necessary to deduct Wendy Phillips overpaid remuneration between the 2015 to 2017 financial years to arrive at the business's "true" trading results.
The claimant's entire earnings should be taxed in his hands based on the authority in Spargo v Hayden Engineering Pty Ltd & Anor (1993) 60 SASR 39, with no allowance for tax minimisation.
This enables the accountant to calculate "True Profits" or Annual Adjusted Business Income (ANBI).
This report did not include results from 2015 and 2016. The expert reasoned that the figure would not be reflective of the state of the business at the time of the accident due to the company restructure and Mr Betteridge's temporary loss of focus on the business when his marriage broke down.
This report relies on the ANBI from the 2017 to 2020 financial years.
The business received Jobkeeper payments during the second half of the 2020 financial year and the 2021 up to the first quarter of 2021.
The report noted that Mr Betteridge stated that COVID-19 did not lead to a loss of work because it created opportunities, which Mr Betteridge had to decline because of the injuries.
This report was prepared with the expectation that Mr Betteridge would have continued to work 21 hours per week in the business until retirement age (i.e. did not account for the time taken off for operations related to the accident).
The report considers complex adjustments, including various levies, pending tax cuts, rebates and offsets. There are complex considerations of the Jobkeeper payments, which I cannot dissect. This report calculates Mr Betteridge's residual earning capacity and assumes his retirement age of seventy, as per his instructions.

Summary PKF accounting report dated 6 April 2021 – author Matthew Gwynne (MJG1)

The insurer engaged the above to analyse the first Katehos’ or CK1 report.
MJG1 asserted there was no evidence to show that the accident caused the decline in revenue. MJG1 criticises CK1 for not addressing Mr Good—equally qualified as Mr Betteridge—leaving to start his own business in Narooma and whether the major bushfires affected the business.
There is a lack of analysis on the contractors’ engagement before and after the accident, which by 2020 decreased to a ratio less than before the accident.
There was a lack of support for the claim that Mr Parsons left the business because
Mr Betteridge could not supply training.
The ANBI assumptions are not supported with evidence and likely to overstate loss due to a lack of analysis of the effect of the ATP grants, the bushfires and the COVID-19 change.
These future economic loss calculations are based on the following:
(a) Scenario 1: an average of CPI-adjusted ANBI calculated for both FY17 and FY18, and
(b) Scenario 2: an average of CPI-adjusted ANBI calculated for FY18.
CK1 further assumes that:
(a) because the business received Jobkeeper payments, the pre-requisite of which was a drop in turnover of at least 30%, then there was a decline in turnover in the June quarter of 2020 when compared to the June quarter of 2019 and, and this decline was as a result of the accident, and
(b) as a result of the accident, the impact of COVID-19 would cause a 30% reduction in the ANBI in the June quarter of 2020.
MJG1 criticises CK1 because it does not analyse the revenue from school projects before and after the accident. The analysis should have detailed the schools where the business did the work; the type of work; agreements; attendances, and amounts invoiced with their dates.
It does not analyse the 2019 revenue. In addition, there is a lack of documentation, including Business Activity Statements (BAS), and there is a general lack of documentary evidence supporting Mr Betteridge's instructions for the CK1 findings.
CK1 did not reduce Mr Betteridge's potential charge-out rates in 2020 when the CPI dropped.

Furzer Crestani supplementary report dated 20 December 2021 in response to MJG1 (CK2)

CK2 found the following flaws in the MJG1 report:
(a)   MJG1 did not consider the 2016 business restructure and the introduction of The App. Comparing the ANBI from 2017 onward with the 2015 -2016 financial years is not appropriate;
(b)   MJG1 was speculating when he alleged turnover reduction due to former employee competition and early 2020 bushfires;
(c)   he did not note the drop in Mr Betteridge's weekly working hours after the accident;
(d)   Treating Alby Betteridge's employment with the business before the accident as being the same after the accident. Before the accident, Alby worked during school holidays as a trade assistant, while after the accident, he left school in year 10 to start as a full-time apprentice;
(e)   MJG’s report did not consider CK1’s analysis of the ATP grant, tanks purchases and sales, and increased labour costs in the 2019-2020 financial years;
(f)    MJG1’s comments about the COVID-19 effect on the business and whether Alby Betteridge and Ms McCarthy's payments represented fair market remuneration for their services to the business were matters for evidence (the summaries of statements and questioning during the assessment dealt with these);
(g)   the CK2 report disagrees with MJG1 that there was no accident-related revenue decline;
(h)   MJG1 assumes the business would not have grown, despite
Mr Betteridge stating he had been expanding the geographical area source work, expanding the geographical area and streamlining operations;
(i)    Mr Betteridge's statement named opportunities he had to reject because of his injuries;
(j)    MJG1 does not acknowledge the loss of roofing jobs, the impact of reduced capacity to travel and that the business could only undertake one-third of the available work;
(k)   the business also intended to take on a second apprentice, which would have opened up opportunities. Mr Betteridge can no longer supervise apprentices, and as Mr Kite is pulling back on work, the business will have to recruit another qualified tradesman to do his work;
(l)    Mr Betteridge missed eight months from his business in the 2019 financial year and then only worked an average of 12 hours per week until September 2019, when he was able to increase his presence up to 21 hours per week. That is what raised the income in 2020. His hours varied since, and he had not returned to work at all since he was in hospital in March 2022;
(m)     even when he was working 21 hours per week after the accident, he was restricted to approximately three hours of chargeable work in a week;
(n)   Mr Betteridge's states Mr Good is not a competitor, so MJG1’s competition assertions are speculative.
MJG1’s assertions about the bushfires were rebutted as Mr Betteridge gave evidence that it created opportunities for restoring infrastructure and renovations. In addition, local tradesmen were and are unable to cope with the demand the fires generated.
This report notes Mr Betteridge's evidence in his statement dated 18 November 2021 that COVID-19 created opportunities because property owners brought renovations forward, and construction was allowed to continue.
CK2 disagrees with MJG1s analysis of the 2019 and 2020 financial years, because MJG1 did not deduct income from the tank sales in 2020 and did not acknowledge that the annual gross income in 2020 was lower than before the accident.
MJG1 report criticises the lack of analysis for subcontractors before and after the accident. Further, the ANBI analysis is not based on replacement labour.
The labour costs before the restructuring are bound to differ greatly because
Mr Betteridge was taking on more labour and had reduced the size of his workforce since 2016.
Regarding the apprentice Alby Betteridge's employment, payment records confirm he worked as a trade assistant during his school holidays before the accident and as a full-time apprentice from early February 2019 until he left in early December 2020. The payments show Alby received apprentice wages at market value.
CK2 corrected the instructions that Mr Parsons left the business because Mr Betteridge could no longer train him. It confirms Mr Parsons wanted to play football, not be a plumber.
The two ATP payments represented payment for the period Mr Parsons was employed once the business qualified for the ATP. This was for a period Mr Betteridge was supervising the apprenticeship.
Ms McCarthy's statement confirms the business paid her a fair market rate for her services, and there was no overpayment. Kevin Donald's statement also confirms that. It is an arm’s length arrangement, unlike the overpayments, Ms Phillips received when she was living with Mr Betteridge.
Regarding the decreased CPI 2020 financial year, Mr Betteridge did not reduce his charge rates that year.

PKF report dated 6 March 2022 commenting on the second Furzer Crestani report (MJG2)

Mr Gwynne was not prepared to alter his first report analysis because he would need additional documentary evidence before he would change his findings. He has listed these in paragraphs 2.6 to 2.7.10 of this report.

PKF's third report dated 19 June 2022 (MJG3)

The balance of the report further analyses the following potential impacts on the business:
(a)   Biolytix tank sales;
(b)   Mr Good’s departure;
(c)   Joss Logistics and Spotless facilities subcontracting;
(d)   extra subcontractors costs;
(e)   Aboriginal Traineeship Program Grant, and
(f)    COVID-19 and bushfire impacts.
Mr Gwynne's analysis confirms that between 2014 and 2018, the business became more reliant on subcontract work for Joss while at the same time, the dollar value of work from other sources and the number of those sources declined. In late April 2018, Joss advised that Joss were unsuccessful in tendering for the government maintenance contract work and effective 1 July 2018, Spotless would be the head contractor. Significantly, the business did not execute a contract with Spotless until late 2018, and in June 2019, Spotless said that it did not require planned maintenance work in 2019 / 2020.

The earlier stark differences, summarised above, were because the insurer’s expert initially held that there was not enough evidence supporting Mr Betteridge’s claimed losses. However, Mr Betteridge’s statements, the expert’s reports and answers to questioning summarised in their joint report helped to resolve the disputed points regarding economic loss.
Mr Betteridge confirmed that Mr Good leaving Mr Betteridge's business did not result in losing clients. Instead, they competed in different markets, both thriving because of the renovations, building, infrastructure and building replacements that COVID-19 and the 2019–2020 bushfires generated.
It was Mr Gwynne’s reasonable initial view that these events could have reduced available work. It was understandable and intuitive reasoning as the combined pandemic and fires were so disruptive and unprecedented, at least for a century in the pandemic’s case. However, Mr Donald and Mr Betteridge’s evidence contradict this view. The pandemic and fires created opportunities in construction and infrastructure, confirming their evidence. ABS data supported the view that the pandemic and natural disasters boosted Australia’s economy for those reasons.
The controversy is whether the accident required the business to employ subcontractors as replacement labour. Adding back that income to calculate ANBI led Mr Gwynne to formulate his replacement labour model.
I prefer the replacement labour model because the CK reports base its ANBI findings on the basis that the after-accident revenue decline was entirely due to the accident, which is less certain. However, the replacement labour model relies on objective medical evidence, which supports Mr Betteridge having lost his capacity to perform routine chargeable plumbing tasks, which can only be replaced with sub contracted tradesmen.
The business has had to employ subcontractors to replace Mr Betteridge’s chargeable labour since the accident. Where it has not done so the business has lost work, such as the roofing work. Despite Mr Betteridge occasionally being able to do chargeable work the preponderance of the medical evidence is that due to the accident he lost and continues to lose his ability to work actively as a plumber.
Mr Gwynne’s proposal considers that Mr Betteridge has lost his physical capacity to be a plumber and provides the following benefits:
(a)   avoids speculation about whether revenue loss from Joss/Spotless was due to the accident;
(b)   removes the need to speculate about whether the business paid family members at arm’s length or for income-splitting purposes;
(c)   does not need to consider whether Alby was engaged to replace
Mr Betteridge or Mr Parsons and include that in adjustments to calculate profit;
(d)   does not need to consider the ratio of materials costs and subcontractor costs to revenue before and after the accident, any change to the “mix in work” before and after the accident and whether that change was as a result of the accident, and
(e)   negates considering any changes in overheads costs before and after the accident and whether any of these changed (increase/ decrease) due to the accident and whether the accident caused those changes.[16]
[16] AD26 p1724 MJG supplementary report dated 20 June 2022.
I can measure this loss with reference to Mr Betteridge’s stated capacity and subcontractor costs incurred or wage survey data.
As noted above, it is reasonable to assess that Mr Betteridge would need to hire a subcontractor as skilled and experienced as he is to replace his labour for at least 45 hours per week.
The accountants have not presented precise figures for the pre-accident weekly earnings or what the post-accident weekly earnings are
The joint report provides a schedule marked A calculating Mr Betteridge’s loss calculated for replacement labour for time lost for chargeable work at $296,218 up to the date of assessment. This is net of tax and includes allowances that would be payable to a contractor.
Both parties accept the method of calculation as accurate, if not the reasons. Accordingly, I assess that as approximating the past economic loss.

Future economic loss

In cases such as Medlin v State Government Insurance Commission (1995) 182 CLR 1 and Husher v Husher (1999) CLR 138, the High Court has confirmed that the fundamental question to be determined in a case such as this, is whether a claimant has sustained a loss or diminution in his earning capacity, and if so whether that loss or diminution will result in economic loss. In calculating any such loss, I must regard the provisions of s 4.7 of the MAI Act.
The insurer accepts that it is most likely Mr Betteridge would have continued in his role in the business as the primary author of fees and as its leader and driver. That acceptance is qualified below.
Due to his accident-related injuries' physical and psychological impacts,
Mr Betteridge claims he cannot exercise his ambition to work.
It is most likely that he has and will suffer future economic loss due to his injuries, because even at the best he has done since the accident he cannot exercise his full capacity as a plumber anymore, which includes his capacity as a mentor/master to his staff. His mental impairments as he spoke about in his evidence will reduce his capacity to transfer his mental energy to leading the business as a mentor, entrepreneur and businessman
The medical evidence supports the claim for the diminution of earnings. The parties have proposed two means of assessing that loss: the ANBI method and the replacement labour method.
The claimant relied on the ANBI method because Mr Betteridge claims it reflects the work he was doing for the business that was not immediately chargeable to any client. However, it considered Mr Betteridge's entrepreneurial, administration, mentoring, leading contribution and ability to grow his business.
Mr Gwynne’s method treats Mr Betteridge purely as a labour component of the business. The latter approach considers average weekly earnings for plumbers including accounting for future CPI hourly rates as well as the change in taxation.
Under the latter method, the drawbacks of using this method could be countered with a buffer for the loss of opportunity to grow his business.
The joint expert report has assisted me with tables from the parties that set out the past economic loss on either basis.
It provides a range of hourly rates based on publicly available information and payments the business has already made to replacement contractors.
Concerning the future net weekly income, I would also find Mr Betteridge could charge himself out at the top rate provided in schedule A of the joint report being $70 per hour. Again, this is due to his experience and knowledge.
Since the accident Mr Betteridge has only contributed a small per centage of his previous chargeable work capacity to the business. The equivalent of a full time contractor at 45 hours per week to replace his labour is necessary because his medical condition restricts him to the lightest types of chargeable work and at most three to four hours per week. As I estimated his probable chargeable hours before the accident were between 45 to 48 hours per week that would replace his labour capacity.
The insurer argued that I should discount damages for future economic loss to consider the heavy nature of the work required as a plumber, as he described in his evidence.
Considering his ambition to work to 70 years old, it is probable that other risks could have caused Mr Betteridge not to reach that target. Suppose he had brought his sons into the business successfully. In that case, though, he could have continued to make significant contributions to growth and marketing and with less or no contribution on the tools. I find he would not have worked past 67 years old in chargeable work, because of the physical toll he conceded plumbing can have and other injuries.
The joint report’s schedule marked A also calculated Mr Betteridge’s loss calculated for replacement labour at 45 hours per week chargeable work net of tax and includes allowances that would be payable to a contractor. I accept that method to calculate the cost of replacement labour to assess future loss of earning capacity. This is subject to an additional buffer for loss of opportunity explained below.

Residual earning capacity

Mr Betteridge had to prove his economic loss; see Todorovic v Waller (1981) 150 CLR 402 at [412]-[413]. However, once he established that loss, it is for the insurer to prove that Mr Betteridge has a residual earning capacity and provide evidence of what he can do and what jobs are open to him.[17]
[17] Luntz, Assessment of Damages for Personal Injury and Death (5^th ed) at 241 [1.11.26].
The insurer must show that a claimant has a residual earning capacity that he is practically capable (rather than theoretically capable) of exercising. A tribunal must make a practical assessment of the likelihood of Mr Betteridge obtaining and keeping a real job, which is accessible to him, considering his pain, restriction and impairment: see Mead v Kerney [2012] NSWCA 215 and South Western Sydney Local Health District v Sorbello [2017] NSWCA 201.
Mr Betteridge’s history before the accident demonstrated an established work ethic.
On Track produced a report dated 1 September 2022[18] which assessed possible career paths in sales, supervision and clerical roles for Mr Betteridge if he had to abandon his business. I agree with the insurer that Mr Betteridge has skills he could apply in other fields.
[18] AD26, p1885.
However, apart from Drs Smith and Mitchell, there is medical agreement that
Mr Betteridge has a limited work capacity. At most, he has a capacity for light work, but others, such as Drs Gray and Powell, opine that he has limited or no capacity for light and heavy work.
The insurer has not provided evidence that deals with the following:
(a)   How Mr Betteridge would deal with seeking concessions from potential employers to make up for his functional and psychological disabilities;
(b)   The submissions and report do not deal with how he would manage his functional and psychological conditions if his work required him to go outside the restrictions that all the doctors agreed he would need. Also, nothing addresses how he would retain full-time employment if he inflamed those conditions, and
(c)   there are no strategies that address how Mr Betteridge would fare when competing with non-disabled applicants in the open labour market for full-time work.
I am not satisfied that the insurer has discharged the onus that Mr Betteridge could be employable on a sustained basis or still be as successful in his business as he hoped because:
(a)   The broad consensus of medical evidence supports the claim that the accident has left Mr Betteridge psychologically and physically impaired and that each impact on the other;
(b)   The continuing pain wears down Mr Betteridge emotionally and reduces his capacity to deal with potential employers, current employees and customers. This will impair his marketing capacity, which requires the ability to travel to meet and market to potential customers or employers, as well as training employees in his own business;
(c)   potential employers, as well as current employees, would need to make allowances for him, including additional time off work, his irritability, limited capacity to perform physical tasks, and
(d)   his ability to work full-time consistently relies on Mr Betteridge's psychiatric and physical conditions aligning enough so that he feels well enough to apply himself to his tasks.
Mr Betteridge will still need heavy pain-killing medication. However, taking strong medication would adversely impact his employability and functioning because it makes him drowsy, and often it could be unsafe to work while taking that medication.
Suitable part-time work would have to be available. Mr Betteridge would still be limited because his capacity to accept work would depend on appropriate work being available and his being well enough to get that work.
I am satisfied though that there is a slight chance that Mr Betteridge could find suitable part-time work over the next 17 years because:
(a)   Mr Betteridge has demonstrated he enjoyed working for its own sake;
(b)   he has shown resilience and a can-do attitude in terms of seeking rehabilitation, and
(c)   In time his psychological condition may ease when suitable jobs may be available. The longevity of any role would depend on whether he aggravated either condition.
I am satisfied that this is a favourable vicissitude that slightly mitigates accident-related disabilities.
I accept, too, that there is a slight chance that health issues he already had, such as the knees and ankles strains, as well as the risk of injury in the general plumbing environment, could have shortened his career from 67 years. Still, these are minor impacts compared with his motor accident injuries, but I will increase the discount to 22% from the usual 15%.
Applying schedule A in the joint expert accountants’ report, I calculate the future economic loss for replacement labour for 45 hours per week at $70 per hour as follows:
$1,368,633 (having added back 15% to $1,163,338) x 22% = $ 1,067,534

Superannuation

This is not claimed.

Loss of opportunity

I have chosen the replacement labour model to assess past and future economic loss, which does not compensate Mr Betteridge for losing his ability to perform more work if the business grew, losing or at least reducing his ability to lead and market his business due to psychological impairment; and reducing his capacity to oversee his employees if he was able to grow the business.
I must consider whether I should include a buffer for losing the opportunity to grow profits for the business. This was the reason Mr Katehos relied on the ANBI method. He opined that his method would capture the claimant’s full loss of earnings capacity, i.e. the replacement labour costs approach fails to consider the losses the claimant has suffered in being unable to exercise his earnings capacity through a business and exercise his entrepreneurial skills.[19]
[19] AD25 p329 CK supplementary report dated 11 July 2022.
The business could still grow and prosper though with Mr Betteridge concentrating on entrepreneurial growth, notwithstanding his injuries. If that were the case, he could be unfairly compensated.
Dimitra Dubrow and Gabrielle Feery's article from the Law Institute of Victoria journal on page 88 of the November 2014 edition assists me in summarising the basic principles for evaluation of a claim for future economic loss being compensated with a cushion as the High Court enunciated in Malec v JC Hutton Pty Ltd (Malec) held in assessing damages, the likelihood of future hypothetical events is to be considered.
Justices Deane, Gaudron and McHugh stated:
“If the law is to take account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring . . . Where proof is necessarily unobtainable, it would be unfair to treat as certain a predication which has a 51 per cent probability of occurring but to ignore altogether a predication which has a 49 per cent probability of occurring. Thus, the Court assesses the degree of probability that an event would have occurred, or might occur, and adjusts its award of damages to reflect the degree of probability.”
Therefore, a tribunal needs to assess a claimant's future earning capacity based on all probabilities, including business failures, commercial shocks such as recessions, promotion, growth or alternative employment.
I have used Mr Gwynne’s replacement labour method above to establish his substantive loss. It is based on Mr Betteridge’s previous employment, career progression, and comparable charge-out rates.
A cushion is appropriate as well, because it reflects the probability that the business could have grown to become more profitable if the accident had not happened.
Due to Mr Betteridge’s psychological injuries, it is less likely he will pivot to become more prominent as the chief executive and commercial head of his business and increase earnings as an entrepreneur. It is also possible that his company will fail, and he could need to rely on alternative employment means to earn a living. He would face severe limitations if that were the case due to his injuries.
Mr Betteridge would be working for another 17 years, so the loss of opportunity to grow his business’s profitability is significant, even if it cannot be calculated precisely.
Mr Betteridge had an established business in what is now a thriving area with higher spending on infrastructure. He had plans to bring his boys into his business and he was a high-energy presence on the Far South Coast capable of growing his business.
Following Malec[20] and State of NSW v Moss,[21]I assess a future buffer to reflect the loss of his capacity to grow and lead the business as well as he could have before the accident.

I allow $146,000 for the buffer.

[20] (1990) 169 CLR.

[21] (2000) 54 NSWLR 536.

Assessment of damages summary

Section 7.36 (1) (b) of the MAI Act requires me to assess the damages for that liability that a court could award.
I assess the damages for this claim based on the above findings:
Non-Economic Loss   $427,000
Economic losses
Past loss of earnings  $296,218
Section 4.5(1)(d) MAI Act damages $19,438
Future loss of earnings, including buffer  $1,213,534 Interest
Total of economic losses and non-economic losses  $ 1,956,190
Total Damages Assessed  $1,956,190
The claimant’s economic losses are to be reduced by and the insurer is to have credit for statutory payments pursuant to s 3.40 of the MAI Act.

Costs and disbursements

I refer to the claimant’s schedule of disbursements[22], insurer’s submissions[23]and the claimant’s submissions in reply. I also note the latest submissions from both parties regarding errors made in the preparation of the disbursements schedule.[24]
[22] AD35
[23] AD36
[24] AD39 & AD40

Insurer’s submissions

The insurer disputes the following items:
Senior counsel’s fees at $11,984.45 (35.5 monetary units x 3 days)
Junior counsel’s fees at $8,439.75 (25 units x 3 days)
Natala Cogger occupational therapy report dated 23 August 2021 at $6,855.62
Dr Jason Beer’s reports at $1,660.20
Loading fee at $2,081.70
The insurer submits that the appropriate rates are in accordance with Part 4 of Schedule 1 of MAIR.
The claimant has made his claim using the fee rates applicable for litigated proceedings.
There is no provision for counsel fees (senior or junior) at an assessment conference beyond the advocacy fee.
The maximum flat fee for legal services provided for an assessment conference is thirty monetary units. An additional three monetary units is allowed for each additional amount per hour in excess of 2 hours.
On the 17 and 18 October 2022, the assessment conference ran from 10.00 am to about 2.30 pm with a one-hour break (7 hours total). On 25 October 2022, the assessment conference ran from 10.00 am to 3.00 pm with around a one-hour break (4 hours).
The insurer notes that counsel attended for a total of 11 hours. The insurer submits the appropriate calculations are as follows:
30 units x $112.53 = $3,375.90.
3 units x $112.53 x 9 hours = $3,038.31
Total: $6,414.21
The insurer submits that Dr Jason Beer’s report is not admissible as he is not a SIRA approved provider and disputes meeting the cost of the report.
The insurer agrees that the cost of an OT report is generally unregulated but submits that Natala Cogger’s report was not reasonable and necessary given the claimant did not make any claim for domestic/personal assistance or homecare and no such claim was available in any event under the MAI Act.
The insurer submits that the applicable loading for a country practitioner is fixed as a loading on professional costs.. It is a one off payment and cannot be claimed for each night away from the practitioner’s office.

Disbursements were otherwise agreed.

Claimant costs submission

The claimant accepts that there is no basis for uplift of costs beyond that which should be allowed by way of normal regulated costs.
The claimant has provided a complete schedule and breakdown of its disbursements.
The respondent has submitted further material regarding submissions for costs.
On 7 December 2022, the claimant provided material in relation to costs to be recovered. That material only related to the attendances by Counsel at the assessment conference.
The insurer has raised issues in relation to the total amount of costs payable to counsel. It was not intended that counsel's costs should be restricted to the amount set out in the claimant's solicitor's letter of 7 December 2022. The total calculation of the claimant's costs for counsel should be allowed pursuant to Schedule 1 contained within the Motor Accidents Injuries Regulations 2017 (the Regulation), in particular, to heading 4 Claims Assessments Schedule 1.
The claimant itemises 132.5 monetary units for Mr Roberts SC and 169.5 units for Mr Heazlewood of counsel.
The claimant asserts that there is no specific bar in the Regulation to instructing senior and junior counsel. The matter was sufficiently complex to require two counsel.
Dr Beer’s report was obtained to pursue the claim.
Ms Cogger’s report could have assisted me in assessing the claimant’s non-economic loss. Both reports would have helped me assessing Mr Betteridge’s level of incapacity.

Reasons regarding costs

The Regulation does not allow for the costs of dual counsel in the Commission. I have no doubt the case was of sufficient complexity that it was appropriate to instruct both counsel, but the Regulation binds me.
In respect of the counsels’ extra attendances I will allow all the attendances itemised for Mr Roberts. The additional conferences and work done is justified because the case required an experienced counsel like either Mr Roberts or Mr Heazlewood to sort what was a complex and challenging factual matrix for presentation. I note the insurer’s submissions on this item.
Although it is not exact I will allow all the units claimed for senior counsel’s work on this matter including attendance at the assessment. I considered using the higher amount of units itemised for Mr Heazlewood, but I would not have allowed the twenty-four units claimed for the cancellation fee for vacating the May assessment dates, because that was the claimant’s application.
In respect of Dr Beer’s and Ms Cogger’s reports, these reports were not presented as items I ought to consider. There was no dispute regarding Mr Betteridge needing care and orthotics. Both reports may have assisted me to assess disability and amenities for non-economic loss, but there were no submissions that lead me to consider these reports in my decision. If they had been probative to the facts in issue then they could have been approved despite Dr Beer lacking SIRA approval.
Despite treatment and personal assistance and care not being included as heads of damage in the MAI Act, these could have been brought to my attention as relevant. As an example of relevance, I found the On Track reports were highly probative in respect of amenities of life and pain and suffering. They assisted me in understanding Mr Betteridge’s case, and the parties drew my attention to them. If the claimant had done likewise for Ms Cogger and Dr Beer’s reports I would have considered them.
A tribunal is obliged to give a party every opportunity to bring to its attention relevant material. It is not obliged to sift through a large volume of material to find information, which supports a party’s case.[25]
[25] GAMESTER PTY LIMITED and BARBARA ANN CAMERON v. THE HONOURABLE MR JUSTICE LOCKHART (1993) 112 ALR 623
I decline to approve these items.
The insurer’s submission on loadings is correct for regional practitioners. However, Mr Glover is an interstate practitioner, and Schedule 1, Part 2(4) of the Regulation applies. A loading is justified in the circumstances of this case. Further, the amount Mr Glover has claimed is reasonable considering the invoices for accommodation and travel he has provided, particularly as it involves travel to a capital city, where such costs are generally higher.
Accordingly, I assess the claimant’s costs and disbursements in accordance with the attached damages and costs calculator to total $182,275.

Legislation

In making my decision, I have considered the following legislation, authorities and guidelines:
· MAI Act;
· Personal Injury Commission Rules;
· PIC Act;
·        CL Act;
·        Malec v JC Hutton (1990) 169 CLR per Deane, Gaudron and McHugh JJ at [7];
·        New South Wales v Moss (2000) 54 NSWLR per Heydon, JA at [70];
·        Husher v Husher [1999] HCA 47;
·        Medlin v State Government Insurance Commission (1995) 182 CLR;
·        Kerney v Mead & Anor [2011] NSWSC 518, and
·        Luntz, Assessment of Damages for Personal Injury and Death, 5th Edition (2021) LexisNexis.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established