Gorrie v Allianz Australia Insurance Limited

[2023] NSWPIC 247

DECISION OF PRESIDENT’S DELEGATE
Citation:	Gorrie v Allianz Australia Insurance Limited [2023] NSWPIC 247
CLAIMANT:	Hugh Gorrie
INSURER:	Allianz Australia Insurance Limited
PResident’s Delegate:	Jeremy Lum
DATE OF DECISION:	25 May 2023
CATCHWORDS:	MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; President’s Delegate rejecting an application for review of merit review decision of Merit Reviewer; relevant considerations for calculation of pre accident weekly earning (PAWE); whether a sole director of a Pty Ltd company receives “income from personal exertion” within the meaning of “loss of earnings” under clause 3 of Schedule 1; Held – I am not satisfied that there is reasonable cause to suspect that the merit review was incorrect in a material respect; the review application will not be referred to a Merit Review Panel.
Orders made:	I am not satisfied that there is reasonable cause to suspect that the merit review was incorrect in a material respect.  Accordingly, the review application will NOT be referred to a Merit Review Panel.

Statement of Reasons for Decision

Issued under section 7.15 of the Motor Accident Injuries Act 2017

Under the Delegation of the President: Item 19, Table of Delegations “A” – Personal Injury Commission Act 2020, PIC Regulation and Scheme regulations

BACKGROUND  

1. Hugh Gorrie (the claimant) was injured in a motor accident on 6 August 2022.

2. On 24 March 2023, Merit Reviewer Castagnet found that the insurer’s reviewable decision be affirmed.

1. Hugh Gorrie (the applicant) seeks to have the assessment of Merit Reviewer Castagnet reviewed on the basis that it was incorrect in a material respect.  He relies on the particulars set out in the application and supporting documentation. 

2. Allianz (the respondent) does not agree that a review is warranted and addresses the issues raised by the applicant.

3. Section 7.15 of the Act provides that if the Delegate of the President is satisfied that there is reasonable cause to suspect that the decision determining the review was incorrect in a material respect, the review application will be referred to a Merit Review Panel.

SUBMISSIONS AND REASONS

1. The applicant disagrees with the merit review decision finding that there is no evidence the company Atlas Collision Repair Equipment Pty Ltd (Atlas) paid any director fees, bonuses or shareholder dividends. 

2. The applicant states:

   “In document AD7 from the merit review, page 13, Under Non Current liabilities Shareholder loans $79,692.  As the sole director and only shareholder, I have received over the last three financial years $71,818 in shareholder loan payments.  It cannot be said there is no evidence of any fees from the company to Hugh Gorrie.  I have attached the company statement for the years 2020 and 2022.  2021 company statement was already submitted in the merit review.”

3. I refer the applicant to paragraph 27 of the merit review decision where the merit reviewer sets out the meaning of loss of earnings as defined in clause 3 of Schedule 1 of the Act.  For ease of reference, this is reproduced as follows:

   3.          Meaning of “loss of earnings”

   (1)Loss of earnings means a loss incurred or likely to be incurred in a person’s income from personal exertion.

   (2)A person’s income from personal exertion is –

   (a)the amount that is the income of the person consisting of earnings, salaries, wages, commissions, fees, bonuses, pensions, retiring allowances and retiring gratuities, allowances and gratuities received in the capacity of employee or in relation to any services rendered, and

   (b)the proceeds of any business carried on by the person either alone or in partnership with any other person, and

   (c)any amount received as bounty or subsidy in carrying on a business.

4. I have read document AD7 and note the detailed balance sheet for Atlas as at 30 June 2021 where under “Total Non-Current Liabilities” there is the amount of $79,692 for “Shareholder’s Loans”.

5. I refer to the subheading titled ‘Discussion’ in the merit reviewer’s decision.  From paragraph 35, the merit reviewer sets out the calculation of the claimant’s PAWE.  I note at no point does the merit reviewer refer to the amount of $79,692. 

6. I do not agree with the applicant that the merit reviewer was required to take into account the amount of $79,692 in the calculation of the claimant’s PAWE.  This is because the applicant has not particularised how “Shareholder’s Loans” is included as income from personal exertion as defined in sub-clause 3(2)(a) (b) and (c) of Schedule 1. 

7. I therefore cannot be satisfied of reasonable cause to suspect that the merit reviewer was required to take into account the amount of $79,692 in the calculation of the claimant’s PAWE.

8. The applicant also submits that there is an error with the merit reviewer’s finding that “…it cannot be said that the claimant was carrying on the business alone (at paragraph 41)”.  The applicant attaches the ASIC annual review and asserts that he (Hugh Gorrie) is the only director and shareholder.  The applicant says he runs the company alone and is the only person on the payroll.

9. I do not accept the applicant’s submission.  The merit reviewer found that Atlas is a separate corporate entity, that is, it is registered as a proprietary (Pty Ltd) company under the Corporations Act 2001.

10. For the claimant to have the proceeds of Atlas ($59,908) included in his PAWE would require the claimant to carry on the business either alone or in partnership with any other person in accordance with sub-clause 3(2)(b) of Schedule 1.  While I acknowledge that the claimant says he is the only director and runs the company himself, the merit reviewer clearly found that the proceeds of the business ($59,908) “…was not received by the claimant as an individual earner but by Atlas as a separate corporate entity.  That is, as a Pty Ltd company.

11. I note that the applicant has not disputed the merit reviewer’s finding that Atlas is a separate corporate entity.

12. I therefore cannot be satisfied of reasonable cause to suspect any material error with the merit reviewer’s interpretation and application of sub-clause 3(2)(b) of Schedule 1.

CONCLUSION

1. For the above reasons, I am not satisfied of reasonable cause to suspect that the merit review decision is incorrect in a material respect.

2. The review application will not be referred to a Merit Review Panel.

1. In making this decision, I have considered the following:

• The application, reply and supporting documentation

• The certificate including the reasons issued by Merit Reviewer Castagnet, the application for assessment, the response and all the documents provided prior to the assessment.

• Motor Accident Injuries Act 2017 (NSW) (the Act).