Estate of the late Huade Ling v Allianz Insurance Australia Limited
[2021] NSWPICMR 48
•29 October 2021
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| CITATION: | Estate of the late Huade Ling v Allianz Insurance Australia Limited [2021] NSWPICMR 48 |
| CLAIMANT: | Estate of the late Huade Ling |
| INSURER: | Allianz Insurance Australia Limited |
| MERIT REVIEWER: | Ray Plibersek |
| DATE OF DECISION: | 29 October 2021 |
| CATCHWORDS: | MOTOR ACCIDENTS- Merit Review; dispute about the amount of ‘reasonable funeral expenses’ under section 3.4 of the Motor Accident Injuries Act 2017; Held - insurer’s decision affirmed; insurer’s total payment of $32,280 for funeral expenses was reasonable; what is ‘reasonable’ depends on a large range of circumstances which cannot be definitively enumerated; what is reasonable will vary in every case and depend upon the circumstances of each case. |
| DETERMINATIONS MADE: | The certificate of this review determination is as follows: 1. The reviewable decision dated 1 July 2021 is affirmed. 2. The insurer’s total payment of $32,280 made or approved under section 3.4 of the Motor Accident Injuries Act 2017 for funeral expenses was reasonable. 3. The amount of legal costs awarded in this case is $NIL. |
Reasons for Decision
Issued under section 7.13(4) of the Motor Accident Injuries Act2017
Background
There is a dispute between the Claimant, the estate of the late Huade Ling, and the insurer about the amount of reasonable funeral expenses that are payable under section 3.4 of the Motor Accident Injuries Act 2017 (the MAI Act). The essence of the dispute is that the insurer is willing to pay a total of $35,280 for the funeral services and burial site and the Claimant’s solicitors are seeking a total of $43,728.40.
Unfortunately the Claimant passed away on 14 January 2021. She was struck by a car reversing out of the Westfield Shopping Centre in Rose Street Hurstville, (A 7).
On 22 February 2021 the Claimant’s mother made an application for funeral expenses, (A 7).
In an email dated 23 February 2021, (A 7), the Claimant’s previous solicitors, Slater and Gordon, wrote advising that the total cost of the funeral services and burial site was $43,728.40.
In an email dated 5 March 2021, (A 5), Slater and Gordon wrote explaining the difference in two costs of two burial sites as follows:
“I have investigated in relation to Castlebrook Memorial Park. I refer to the attached quotations for the different sizes of burial sites.
The bigger one cost $33,572 for 1.2m internal and 1.8m external and the smaller one cost $25,124 for 0.9m internal and 1.5m external.
The family choice the bigger one for mum to make her comfortable consider she dead in such a tragic accident.”
In an email dated 12 March 2021, (A 5), the Claimant’s previous solicitors wrote advising that the quoted cost from Castlebrook Memorial Park of a smaller two-person burial site was $25,124 and the larger four-person burial site was $33,572. The solicitors advised that the family had chosen and sought reimbursement for the larger burial site.
In a letter dated 6 May 2021, the insurer wrote to the Claimant’s previous solicitors advising that it will pay reasonable funeral expenses up to $20,000, (A 6).
On 7 June 2021 the Claimant’s solicitors made an application for Internal Review concerning the decision to pay funeral expenses of $20,000, (A 11). The outcome sought was reimbursement of $34,892 for the funeral and cemetery fees.
On 1 July 2021, the insurer wrote advising the Claimant’s solicitors that it had completed the request for an internal review and that it had decided to overturn the original decision, (A 8 and A 9).
The outcome of the internal review decision was :
“1. The decision that Allianz will pay reasonable costs in relation to the funeral expenses up to $20,000 is overturned.
2. I have approved the reasonable costs of up to $25,124.00 related to the funeral expenses associated with Castlebrook Memorial Park. Please send an invoice for the small burial site to your customer care consultant in order to process the reimbursement request.
3. I note this is in addition to the amount of $10,156.00 already reimbursed for Funeral Directors fee ($7084.00), Buddha Statue ($600.00), Ceremonial supplies ($472.00) and Buddhism ritual ceremony ($2000.00).”
When giving reasons for its finding on internal review the insurer’s statement included the following reasoning:
“10. I note the current dispute concerns the decision that funeral expenses up to $20,000 will be paid. Specifically the dispute concerns whether a small burial site is reasonable as opposed to a large burial site for four as quoted in the agreement from Invocare. …….
12. After consideration of the evidence above, I am not satisfied that the costs of the larger burial site for four as originally quoted by Invocare for $33,572.00 (which is the amount in the agreement between Invocare and Pucharser (Agreement number 28526) is reasonable pursuant to the Motor Accident Injuries Act 2017.”
In the application for review dated 16 July 2021 the Claimant’s previous solicitors set out the basis of the dispute as:
“We dispute the insurer’s decision that they reimburse the fees for cemetery of Castlebrook Memorial Park in the amount of $25,124.00.We refer to the tax invoice from Castlebrook Memorial Park dated 7 May 2021.We submit that the fees for the cemetery of Castlebrook Memorial Park in the amount of $34,892.00 are reasonable costs in relation to the funeral expenses and should be reimbursed.”
Documents considered
The documents I have considered are those listed in, referred to, or attached to, the application for merit review and the insurer’s reply together with all the attachments.
Submissions
The Claimant’s solicitors made written submissions in the application for review dated 16 July 2021. Those written submissions included the following arguments:
(a) the Claimant disputes the insurer’s decision to reimburse the Castlebrook Memorial Park amount of $25,124, and
(b) the fees for the cemetery amount of $34,892 were submitted to be reasonable costs in relation to the funeral expenses and should be reimbursed.
In its Submissions in Reply dated 5 August 2021, (R 1), the insurer’s solicitors submit that:
(a) the cost of $25,124 for funeral expenses is reasonable and necessary (in addition to the reimbursed amount of $10,156) as opposed to the larger burial cost of $33,572, and
(b) the insurer sets out in considerable details all of the invoices and services provided for the Claimant’s funeral service. Having analysed all those payments and invoices the solicitors conclude that there are some confusions between the invoices paid and the expenses claimed. For example, the submissions refer to three payments made which total $33,572 for which the HY solicitors claim $34,892, (see R 1, paragraphs 13-16).
Reasons
This is a dispute between the Claimant and the insurer about the amount of reasonable funeral expenses.
I will briefly refer to the relevant legislation and then consider the evidence and set out my determination.
Nature of merit review
This matter is a merit review of the decision of the insurer about the amount of reasonable funeral expenses under section 3.4 of the MAI Act. The dispute about the amount payable for funeral expenses is a reviewable decision as it is listed in Schedule 2 sub-clause 1 (a) of the MAI Act. The review requires that I decide what the correct and preferable decision is having regard to the material then before me including any relevant factual material and any applicable law.
Legislation
Section 3.4 of the MAI Act provides statutory benefits are payable for reasonable funeral expenses. The funeral expenses are payable to the legal personal representative of the deceased or the person who has paid or is liable to pay the funeral expenses. There is no definition of ‘reasonable funeral expenses’ in either the MAI Act, the Motor Accident Injuries Regulation 2017 (the Regulation) or the Motor Accident Guidelines. Nor does the MAI Act specify any amount or value that is considered to be “reasonable funeral expenses”. If the deceased usually resided in Australia, reasonable expenses include transport for burial or to the usual residence. If the deceased usually resided outside Australia, reasonable expenses include transport to the usual country of residence.
Section 3.7 of the MAI Act provides as follows:
“3.4 Statutory benefits for funeral expenses
(1) If the death of a person results from a motor accident, statutory benefits are payable for reasonable funeral expenses to—
(a) the legal personal representative of the deceased, or
(b) if there is no legal personal representative—the person who has paid or is liable to pay those expenses.
(2) If the usual place of residence of the deceased person was, at the time of the person’s death, in Australia, funeral expenses are to include the reasonable cost of transporting the body of the deceased to either of the following—
(a) what would, in the circumstances, be an appropriate place for its preparation for burial or cremation,
(b) that usual place of residence.
(3) If the usual place of residence of the deceased person was, at the time of the person’s death, in a country other than Australia, funeral expenses are to include the reasonable cost of transporting the body of the deceased to that country.”
Determination
The insurer initially approved the payment of $20,000 for funeral expenses. It then reviewed and overturned its original decision. The insurer approved costs of up to $25,124 for funeral expenses at Castlebrook Memorial Park plus $10,156 already reimbursed for; Funeral Directors fee ($7,084), Buddha Statue ($600), Ceremonial supplies ($472) and Buddhism ritual ceremony ($2,000).
The total amount paid, reimbursed or approved by the insurer was $32,280.
The Claimant’s solicitors maintained their claim for the total cost of the funeral services and burial site of $43,728.40. The Claimant’s solicitors argued in their application for review that the insurer should reimburse the fees for cemetery of Castlebrook Memorial Park not for the lower amount of $25,124 but for the larger burial site for the higher amount of $34,892.
From my reading of the invoices, emails and submissions it seems the insurer approved or reimbursed all the funeral expenses claimed by the Claimant’s solicitors except for the larger burial site. The parties diverge on the issue of the fees for the cemetery burial site at Castlebrook Memorial Park. These fees for the cemetery include the burial site and the burial site decorations, inscriptions and photos. The insurer has approved payment of the two-person burial site in amount of $25,124. The Claimant maintains her claim for the four- person burial site for the higher amount of $34,892.
As noted, above there are no definitions in the legislation of what constitutes ‘reasonable funeral expenses’. Funeral expenses could include: funeral director’s fees, cost of the funeral service (including cremation or burial), coffin/urn, mourning car, burial site, purchase and installation of a monument or headstone, embalming of the body, possible transport overseas, flowers, newspaper notice and death certificate.
What is ‘reasonable’ depends on a large range of circumstances which cannot be definitively enumerated. What is ‘reasonable’ could depend on : the personal circumstances of the deceased, the size of the deceased’s family and friends, the nature of the deceased’s standing in the community, his or her occupation, cultural matters or religious beliefs. In some situations a small private funeral may be reasonable. In another situation a significantly more elaborate funeral and service may be reasonable. For example, the deceased usually lived overseas, had to be transported and buried overseas, had a large group of family and friends and had an elaborate but culturally or religiously appropriate funeral service. What is reasonable will vary in every case and depend upon the circumstances of each case.
In this case the deceased had come from overseas but usually lived in Australia. Based on the invoices it seems that she had a funeral service, interment rites and burial site appropriate to the Buddhist tradition. The invoices and submissions refer to: Funeral Directors fees, Buddhism ritual ceremony, Buddha Statue, Ceremonial supplies, photographs, inscriptions and the purchase of a four-person burial site.
There is little evidence before me detailing the deceased personal circumstances except that she was a lady aged 69 of Buddhist faith, had a family and was resident in Australia. In my view, all of the above listed funeral expenses were reasonable and appropriate in the deceased’s circumstances except for the four-person burial site. I find that in the deceased’s circumstances a one or two-person burial site would be reasonable, not a four-person burial site. Accordingly, I conclude that the total reasonable funeral expenses that should be allowed in the circumstances of this case are as specified by the insurer totalling $32,280. This amount is inclusive of the two-person burial site in amount of $25,124 plus $10,156 for the cost of funeral directors fees, Buddhism ritual ceremony and the other listed expenses.
Legal Costs
Disputes about the amount of statutory benefits payable for funeral expenses are a merit review matter under Schedule 2 sub-clause 1 (a) of the MAI Act. These disputes are not a regulated merit review matter listed in Schedule 1, Part 1 of the Motor Accident Injuries Regulation and therefore no costs are payable for any legal work undertaken in any dispute about the funeral expenses claim.
As no regulated legal costs are payable for such a dispute, the amount of legal costs awarded in this case is $NIL.
Conclusion
Having considered all of the submissions and evidence I conclude that the insurer’s total payments of $32,280 for funeral expenses were reasonable in the circumstances of the Claimant’s case.
Ray Plibersek
General Member and Merit Reviewer
(Motor Accidents Division)
Personal Injury Commission
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