Harrison v AAI Limited t/as GIO
[2023] NSWPIC 313
•30 June 2023
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | Harrison v AAI Limited t/as GIO [2023] NSWPIC 313 |
| Claimant: | Eva Harrison |
| insurer: | AAI Limited t/as GIO |
| Member: | Terrence Broomfield |
| DATE OF DECISION: | 30 June 2023 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; damages assessment pursuant to section 7.6; liability admitted; 18-year-old claimant pedestrian on a footpath when a car collided with her and others in the group inflicting fatal injuries upon claimants’ best friend; no significant dispute in relation to diagnosis of significant physical and psychological injuries suffered by the claimant; dispute relating to impact of injuries on earning capacity; dispute relating to recovery of future travel expenses pursuant to section 4.5(b) for future travel to treatment providers; Held - damages assessed of $400,000 for non-economic loss with total of $1,123,930 plus regulated costs with no award for future travel expenses. |
| determinations made: | CERTIFICATE OF DETERMINATION In accordance with Division 7.6 of the Motor Accident Injuries Act 2017 (MAI Act), the Commission’s assessment is: 1. The amount of damages for the claim is $1,123,930. 2. The amount of the claimant’s costs in the matter is $69,451.77 inclusive of GST. |
STATEMENT OF REASONS
INTRODUCTION
Eva Harrison (the claimant) at about 10.30pm on 7 November 2020 was walking down a street in Wollongong with her best friend and their respective boyfriends when a motor vehicle left the roadway, drove on the footpath, and collided with the claimant and her friends with tragic consequences. The vehicle struck the claimant’s left side/buttock area forcing her some five metres along the footpath after the impact. The vehicle also inflicted significant injuries on the claimant’s boyfriend as well as forcefully thrusting her best friend into a brick wall inflicting what proved to be fatal injuries upon her best friend before the vehicle came to rest after colliding with a pole on the footpath.
The compulsory third-party insurer of the vehicle has admitted liability for the claimant’s injuries loss and damage however disputes the claimant’s quantification of those damages.
The claimant was 18 years of age at the time of the accident and witnessed at the scene of the accident the grossly disfiguring facial injuries suffered by her best friend and was present at the hospital soon after the accident when her best friend passed away as was the claimant’s mother. The claimant’s mother deposes in a statement dated 18 May 2023 as having seen her daughter’s best friend in the same hospital room on the evening of the accident. The claimant’s mother deposes that the claimant ‘’heard and saw all the traumatic events that occurred prior to... (her best friend) ... losing her life’’ and recalled her daughter’s best friend ‘’had no face, her jaw was ripped apart’’[1].
[1] Paragraphs 9 and 10 Statement of Jackie Deans page 9 [AD2}
Not surprisingly the claimant developed what was not disputed to be a significant post-traumatic stress disorder and has had extensive therapy with a psychologist with various consultations with a psychiatrist. Both parties had medico-legal assessments undertaken by psychiatrists two months apart some two years after the accident.
The claimant also suffered significant physical injuries that are not disputed that continue to impact upon her. Both parties obtained medico-legal experts to assess the physical injuries that were undertaken within approximately two months of each other also some two years after the accident. Again, there is no substantial dispute in respect to the physical injuries that involve soft tissue injuries to the cervical spine, left shoulder, lumbar spine, buttock and left leg. Hamstring tendinitis and ischial bursitis was also diagnosed the latter of which was treated by a corticosteroid injection on 2 July 2021 that provided some four months pain relief in that area.
The claimant continues to receive treatment for her physical and psychological injuries.
AGREED MATTERS
The following matters were agreed between the parties:
(a) That the claimant has an entitlement to non-economic loss.
(b) The amount to be awarded for tax paid on her statutory payments is $8,130.
[see Fox v Wood (1981) 148 CLR 438 ('Fox v Wood')]
(c) Statutory payments made by the insurer to the claimant for which the insurer seeks credit amounts to $56,085.25.
(d) Legal costs subject to assessing those professional costs based on the quantum of my award.
HEADS OF DAMAGES TO BE ASSESSED
The following damages are required to be assessed:
(a) non-economic loss;
(b) past economic loss;
(c) past loss of superannuation entitlements;
(d) future economic loss;
(e) future loss of superannuation entitlements, and
(f) future travel expenses.
ISSUES TO BE DETERMINED
Whilst there was no significant dispute between the parties in relation to the diagnosis of the claimant’s physical and psychiatric injuries the disputes between the parties are essentially:
(a) The extent of the claimant’s disabilities that have arisen from the physical and psychiatric injuries suffered by the claimant since the accident.
(b) The extent of the likely future disabilities that will beset the claimant from the physical and psychiatric injuries suffered by her in the accident.
(c) The extent to which the claimant’s disabilities have impacted upon her past and future earning capacity.
SUBMISSIONS
The insurer does not dispute that the accident in which the claimant was injured was traumatic with tragic consequences causing the claimant to suffer a psychiatric condition together with soft tissue injuries to the left leg, left shoulder, back and neck. The insurer submitted that there was some cause for a level of optimism regarding her psychiatric condition in accordance with the opinion of Dr Whetton who opined there had been some improvement over time acknowledging the claimant’s determination to gain her previous level of functioning and return to work. The insurer also submits that the impact of the physical injuries is relatively modest. The insurer further submitted that there is consistent medical opinion that the claimant has the capacity work 15 to 20 hours per week and indeed some opinion expressing up to 30 hours per week and accordingly there is an identifiable and significant residual earning capacity.
Furthermore, there are various references to the claimant returning to some of what might be said to be her pre-accident activities including roller-skating, running after a dog on a beach, returning to the gym three to four days per week which provides some comfort that her future will not be plagued with the pessimism that permeates the submissions made on her behalf.
On the other hand, it was submitted on behalf the claimant that the impact of the accident has had a devastating impact upon the claimant visiting upon her a significant post-traumatic stress disorder with a major depressive disorder the effects of which are likely to be lifelong with this accident occurring when she was only 18 years of age at a time when she had her life ahead of her. Some two and a half years after the accident she still suffers the legacy of the physical injuries also inflicted upon her from this traumatic accident. As a result of the physical injuries, she is severely incapacitated in undertaking various types of work with significant ongoing restrictions and has never been successful in maintaining any of her post accident employment other than her current barista position that must be assessed to be notional employment with a most sympathetic employer. It was further submitted on behalf of the claimant that any observation of her answering questions at the assessment conference confirmed her poor memory with inconsistent answers often against her interest. Hence, any assessment of the economic capacity ought to be predicated on total loss of capacity with perhaps a slightly greater percentage allocated to reduce her future economic loss for contingencies and vicissitudes.
The claimant it was further submitted was assessed by several doctors however none of the opinions indicated that there would be any significant improvement in the future.
EVIDENCE
The evidence on behalf the claimant in this matter included extensive clinical notes from treating doctors and allied health professionals as well as clinical notes from claimant’s initial attendance at Wollongong Hospital together with clinical notes associated with her inpatient admission at the Hills Clinic where the claimant was admitted for psychiatric treatment from 9 November 2021 to 24 November 2021.In addition I have the benefit of two statements from the claimant together with a statement from the claimant’s mother and medico-legal reports that assessed both the claimant’s physical and psychiatric injuries. I also have the benefit of hearing the claimant being questioned for over an hour during which time the claimant left the room after asking to take a break and during the break I was advised the claimant was having a panic attack and required the assistance of her mother who attended the assessment conference as the claimant’s support person.
The claimant in her statement attested to her pre-accident work history which involved undertaking a Diploma in Beauty Therapy including working in beauty therapy full-time until the business closed in August 2020. The claimant was looking for work in that area when she secured part time employment in an ice creamery and subsequently a café before commencing full-time employment as an administration clerk in her stepfather’s business where she was employed at the time of the accident.
The claimant’s long-term general practitioner Dr Gilchrist certified her unfit for work for the six months after the accident and referred her for psychological counselling and physiotherapy for the physical injuries. The claimant says she had about 50 physiotherapy sessions before ceasing that treatment.
The claimant further deposed of her trouble sleeping and her experiencing flashbacks and reliving the accident that took her ‘’to a dark place’’[2] with her also deposing that she ‘’felt miserable and wanted to end my life’’[3].
[2] Paragraph 7 claimant’s statement page 8 [A1]
[3] Paragraph 76 claimant’s statement page 8 [A1]
At the time of completing her statement in February 2023 she describes herself as continuing to “battle with severe depression and anxiety’’[4] and feeling like “the accident took my youth from me. It stole the happiness and love of life I once had’’[5].
[4] Paragraph 143 claimant’s statement page 13 [A1]
[5] Paragraph 157 claimant’s statement page 14 [A1]
In an updated statement the claimant deposes that her condition “has not improved since my earlier statement. If anything, it seems to have changed for the worse’’[6].
[6] Paragraph 4 claimant’s second statement page 7 [AD2]
The claimant’s mother deposes in her statement that the claimant “has given up everything she loved doing, she no longer has friends and has had to end the relationship with Tye, who I believed she would have otherwise married. She also ended her most recent relationship’’[7]. the claimant’s mother further deposes that the claimant “cannot maintain any relationships. Most of the time Eva spends in bed’’[8].
[7] Paragraph 18 statement of Jackie Deans page 10 [AD2]
[8] Paragraph 19 statement of Jackie Deans page10 [AD2]
Soon after the accident the claimant was referred for treatment with a psychologist with her general practitioner soon thereafter prescribing antidepressant medication. Subsequently, the claimant was referred to Dr Ferris, a pain specialist due to her ongoing physical issues particularly with her right leg who arranged for an ischial bursal hamstring tendon injection that afforded the claimant some four months relief. The claimant is awaiting a further appointment with Dr Ferris for further treatment.
In late 2021 the claimant was at home and heard a car travelling down the street in front of the home that appeared to be doing burnouts causing a loud screeching noise. The noise from burnouts appears to have exacerbated the claimant’s psychological condition that resulted in significant panic attacks which combined with the first anniversary of the accident that was imminent, appears to have been the catalyst causing a need for the claimant to be referred for psychiatric treatment at the Hills Clinic for what was to be a three-week admission. The claimant however discharged herself almost a week early as she was not comfortable in that environment and severely missed her home and family.
The claimant’s solicitor arranged for her consult with Dr Bertucen psychiatrist who conducted a tele-health assessment on 18 October 2022. Dr Bertucen diagnosed a chronic post-traumatic stress disorder and comorbid major depressive disorder observing that whilst those conditions were active, they were not “disabling’’[9] but they still exerted “a significantly adverse effect on Ms Harrison’s quality of life to the present day’’[10]. Dr Bertucen on page 7 of his report dated 21 October 2022 said of the claimant’s continuing disabilities that she continued to suffer:
“…impairments of concentration, memory and focus, and in addition with regards to establishment of lasting and trusting intimate relationships, social withdrawal from friends, a somewhat maladaptive coping strategy of binge pattern alcohol consumption (as part of the social ritual), demotivation with regards to work and study and significant anxiety and triggering regards to eg. locations, sights and sounds within the local area”[11].
[9] Page 7 Dr Bertucen’s report page 48 [A1]
[10] Page 7 Dr Bertucen’s report page 48[A1]
[11] Page 7 Dr Bertucen’s report page 48 [A1]
Dr Bertucen opined that the claimant was probably capable of 15 to 20 hours per week work or study that was likely to experience “difficulties with concentration, motivation and maintaining the pace of work output’’[12] if she worked beyond those hours. A guarded prognosis was provided as a result of persisting depressive and anxiety/post-traumatic stress disorder although further treatment Dr Bertucen opined was likely to ameliorate the prognosis.
[12] Page 7 Dr Bertucen’s report page 48 [A1]
The claimant’s solicitor arranged for her consult with Dr Porteous to assess the physical injuries and he found hamstring tendinitis and ischial bursitis noting the history of chronic cervical spine tingling who then diagnosed soft tissue injuries of the left shoulder, left arm with a neurological injury emanating from the C8 distribution. Dr Porteous restricted her physically in the workplace from positions that require frequent or constant kneeling, crouching walking up and down steps or slopes with the ability to take a break if required to sit stand or walk. He also indicated that the claimant should not undertake heavy lifting, pushing, pulling, or carrying. Dr Porteous felt that she was totally unemployable from a psychiatric respective but wished to defer to a psychiatrist however failed to provide prognosis in respect of the physical injuries notwithstanding been asked to do so.
Dr Porteous did however prescribe a range of treatment for the physical injuries all of which appeared to be short to medium term that would subsequently require an occupational therapy assessment to clarify work options and restrictions after that further treatment.
The insurer arranged for the claimant to be assessed by Dr Whetton on 12 December 2022. Dr Whetton diagnosed post-traumatic stress disorder which was associated with excessive use of alcohol. He confirmed that the psychiatric condition had stabilised and “had improved to a significant degree’’[13]. Dr Whetton provided a “satisfactory’’ prognosis and referred to “a level of optimism and determination to gain her previous level of functioning and work’’[14]. He did however note that “she continues to describe nightmares, flashbacks and intrusive thoughts triggered or spontaneous acknowledging that there had been significant impairment in her employment abilities’’[15]. Dr Whetton noted that the claimant had recently gained a new job in a café three days per week.
[13] Page 8 Dr Whetton’s report page 25 [R1]
[14] Page 8 Dr Whetton’s report page 25 [R1]
[15] Page 8 Dr Whetton’s report page 25 [R1]
The insurer also arranged for the claimant to have her physical injuries assessed by Dr Hyde–Page who on page 6 of his report dated 14 October 2023 found she suffered:
“…musculoligamentous or soft tissue injuries to her cervical spine, left shoulder as well as the lumbar spine and buttock. She has ongoing symptoms that include radicular pain down the left arm involving C6/7, as well as radicular pain down her left leg with S1 radicular pain’’[16].
He described on page 8 of his report dated 14 October 2022 the impact her injuries have had on her and her earning capacity as:
“…a significant disability with general mobility and activity that also had a significant impact on the working capacity. She had to stop working and training as a veterinary nurse, as well as working in a shoe shop because the manual activity involved a lot of walking, standing, bending, and lifting. These aggravated her symptoms. She either stopped the work or was put off’’[17].
[16] Page 6 Dr Hyde-Page’s report page 14 [R1]
[17] Page 8 Dr Hyde-Page’s report page 16 [R1]
Whilst Dr Hyde-Page felt the claimant’s intention at the time of his assessment to look for work as a receptionist was appropriate, he believed her recovery had plateaued and “it appears that she will have persistent symptoms …. affecting the neck, left shoulder, left upper limb, back and left lower limb’’[18].
[18] Page 7 Dr Hyde-Page’s report page 15 [R1]
The insurer also provided some payslips and a certificate of earnings obtained from her employer at the time of the accident as well as wage rates for beauty therapist and veterinary nurses.
FINDINGS
As I indicated during the assessment conference there is little material difference between the diagnosis of the insurers and claimant’s medico legal experts in respect of their assessment of the claimant both physically and psychiatrically. Both counsels sought to highlight respectively on behalf the claimant the pessimism that permeates those assessments and on behalf the insurer the hint of optimism that permeates those assessments. During the assessment conference I have heard from the claimant who was questioned for over an hour and her answers were consistent with the psychiatric assessments confirming that she had poor memory and often her answers were inconsistent and contrary to her own interest.
The claimant’s recollection of particularly the timing and duration of her pre-accident and post-accident employment was particularly poor and accordingly it is difficult to make findings in relation to those matters. I do not in any way question the credibility of the claimant and find that she certainly was not attempting in any way to mislead me in respect to the answers she provided when questioned and find that her responses were consistent with the impact of the accident that has been documented by particularly Dr Bertucen when he assessed her. Accordingly, I find a need to carefully assess the contemporaneous documentary material that was recorded by her treating practitioners and allied health professionals that are more likely to accurately record what was happening with her at that time rather than to rely upon her current recall of events.
The questioning of the claimant to a large extent was confined to the matters that were designed to elicit clarification particularly of her pre and post-accident employment and when she was employed and what may have been her likely earnings. There has been some employment with Licked Galateria, Novo Shoes, Bean Barista, and some short employment for some weeks on Hamilton Island in a resort after the accident.
Part of the insurer’s submissions relate to the demonstrated ability the claimant has had in securing employment and maintaining some employment since the accident. On the other hand, it was submitted on behalf the claimant that the only employment in which there is been any significant continuity relates to her current employment with Bean Barista which is clearly “grace and favour’’ employment as she can rest when required and not attend shifts if she feels she is unable to appropriately carry out her normal duties. Such flexibility goes beyond that of a sympathetic employer. The claimant clearly has a very close relationship with her current employer that is further evidenced upon her resumption of that employment after returning from Hamilton Island in late April 2023 after leaving her employment with Bean Barista to pursue employment on Hamilton Island. The claimant told me at the assessment conference that she anticipated remaining in her current employment at least in the short term.
I agree with the claimant’s counsels’ submission that the claimant's current employment in certainly not at arm’s length. It is however likely to continue in the short to medium term whilst ever the claimant to wishes to remain. This could be interrupted by numerous factors including a possible change in management or ownership of the business which in those circumstances could result in that employment ceasing. I note Dr Whetton placed some significance on what was at the time of his assessment a new job in a café three days a week by expressing some optimism. Dr Whetton appears to have been persuaded by the claimant’s determination to return to a normal lifestyle and work. It appears Dr Whetton was unaware of how sympathetic the employer had been to the claimant’s incapacity. Consistent with her previous general practitioner’s incapacity certificates there has been restrictions provided physically which I note are consistent with those found by Dr Hyde-Page and Dr Porteous that include providing the claimant with rest periods when she is needing to stand or sit for protracted periods during her work shift.
When assessing the level of disability visited upon the claimant since the accident by both the psychiatric and physical injuries and the role the various attempts at employment since the accident it is pertinent to be cognisant of the claimant’s demonstrated work ethic. I have earlier referred to her initial training as a beauty therapist and working in that area until that was not available to her because of the closure of the business. The claimant actively pursued and obtained other work prior to the position which she took up with her stepfather that involved administrative duties which she was undertaking at the time the accident. I am mindful that shortly after commencing the first employment she was capable of undertaking after the accident she expressed her concerns to her treating psychologist Mrs Rachel Addison a consultation on 29 June 2021 “Client reported experiencing panic at work and had to leave mid-shift due to distress. She reported concerns that her work ethic will always be perceived as compromised due to her ongoing panic and anxiety’’[19].
[19] Addison’s clinical notes page 146 [A1]
I find that the claimant is a young lady that has demonstrated a strong work ethic both before the accident and after it. She has and continues to exercise the full extent of her residual earning capacity so far as it can be within the constraints of her physical and psychiatric limitations. I prefer the opinion of Dr Bertucen who differs in prognosis to that of Dr Whetton. It appears Dr Whetton had not been fully informed of the accommodation that had been provided to the claimant by her employer. I note that such employment had commenced some five weeks prior to the consultation with Dr Whetton. As the claimant indicated to me at the assessment conference there are occasions where she has either returned home early from her shift or she has been unable to attend a designated shift due either to physical or motivation reasons. Dr Bertucen however, does give some cause was some slight optimism that with further treatment there is likely to be some gain.
As I have earlier indicated, Dr Porteous when assessing the physical injuries on behalf the claimant appears to have failed to provide a prognosis indicating the claimant was totally unemployable from the psychiatric perspective. Dr Porteous failed to give any real insight as to the claimant’s residual employability from a physical perspective. He did however restrict her physically from various activities whereas Dr Hyde-Page appeared more thorough in his reporting and whilst finding receptionist duties to be appropriate in respect to her future employment did concede that she has persistent symptoms affecting her left shoulder, left upper limb, back and left lower limb. At the assessment conference the claimant said that she had dismissed pursuing any career as a receptionist as she would have far too much “time to think’’ which is not compatible with her mental health and which is why she prefers the physical task-based duties of the type of employment she currently has as a barista.
I accordingly prefer the opinions of Dr Bertucen and Dr Hyde-Page as earlier indicated where they differ from the opinions of Dr Whetton and Dr Porteous.
I find that the claimant continues to suffer significant disabilities physically and psychiatrically and accept unreservedly the statement of her mother. Her mother describes her daughter as having gone from being a fun loving confident talkative lively young lady to one that now self-medicates with alcohol becomes reclusive, suffers ongoing nightmares and panic attacks with a demonstrated inability to maintain relationships particularly with the opposite sex spending considerable time in her room and in bed. I also find in accordance with the opinion of Dr Hyde-Page that the claimant will continue to have symptoms affecting her neck, left shoulder left upper limb back and left lower limb.
Consistent with my findings the claimant’s earning capacity both past and future has been significantly compromised and will deal with such in further detail in my reasons when assessing both past and future economic.
DAMAGES ASSESSMENT
(a)Non-economic loss
Any assessment of non-economic loss often referred to as ‘pain and suffering’ incorporates an assessment of damages for loss of expectation of life, pain and suffering, loss of amenities of life (how the accident-related injuries affect the claimant) and scarring.
It was submitted on behalf of the insurer that an appropriate award was in the range of $250,000 to $275,000 whilst the claimant’s submission was that the capped maximum ought to be awarded namely $605,000.
The claimant was 18 years of age at the date of this accident and now is aged 21 years. She has a life expectancy of 65 years. It is not disputed that the claimant witnessed horrific and tragic circumstances surrounding an accident in which she personally suffered physical injuries that impact upon her day-to-day living and her ability to work. She also has a significant post-traumatic stress disorder that will likely remain with her for life that has associated panic attacks and depressive symptoms.
The claimant prior to the accident enjoyed regular gym attendances to keep fit, skating and skiing. She was an 18-year-old who was family orientated, very social and described to be “lively and talkative”[20] by her mother. She was young lady with an undisputed work ethic but also enjoyed an active social life having been in a relationship with her boyfriend who was seriously injured in the same accident and this relationship according to the observations of her mother had real prospects of being long-term. The relationship at the request of the claimant ceased because of the impact the accident has had upon her.
[20] Paragraph 5 statement of Jackie Deans page 9 [A1]
Witnessing the horrific trauma visited upon her best friend at the accident site and in the hospital subsequently prior to her best friend passing away that evening not surprisingly has had a devastating impact upon the claimant. Initially her distress caused her not to be able to eat or sleep with her days and evenings been punctuated by intermittent hysterical episodes. In the months following the accident the claimant consulted with her general practitioner on several occasions who recorded “on two occasions during that month either reported that she didn’t care if she lived, or wished she were dead’’[21].
[21] Statement of Dr Emma Gilchrist dated 14 June 2021 page 463 [A1]
The claimant endured extensive physiotherapy for her physical injuries and has and continues to have psychological counselling on a regular basis. Her ongoing pain in the left arm and left leg caused magnetic resonance imaging to be commissioned that disclosed left hamstring tendinitis and left ischial bursitis. At the request of the pain specialist corticosteroid was injected in her into her left hip on 2 July 2021 that only afforded her some months pain relief. The general practitioner had earlier prescribed antidepressant medication with a second antidepressant agent added due to ongoing low mood, fatigue, and poor sleep in mid-2021.
The claimant’s psychiatric status deteriorated leading up to the first anniversary of the accident when some short time before she heard screeching tyres outside the home where somebody was undertaking ‘’burnout’’ manoeuvres that severely exacerbated her psychological symptoms. Such resulted in her being referred to a three-week inpatient psychiatric treatment program at the Hills Clinic that commenced on 9 November 2021 with her discharging herself almost a week prematurely on 24 November 2021.
The claimant’s ongoing stress and anxiety caused a pre-existing condition relating to facial acne to flare up again it having been previously well controlled prior to the accident. Towards mid 2022 she required the intervention of a dermatologist[22] to treat that condition which continues to be monitored.
[22] Report Dr Estella Tanz dermatology registrar page 463 [A1]
Her physical and psychiatric restrictions have adversely impacted on all her post accident employment other than the current employment where she works as a barista for who is clearly a very sympathetic employer. While she works two to three days per week of shifts of four to five hours, she has the flexibility of been able to rest during her shift and have another barista undertake her duties for a period, leave a shift early or provide notice that she is unable to attend a particular shift with apparent impunity.
Whilst further treatment both psychiatrically and physically may ameliorate her condition to some extent there is no medical evidence suggesting that there will be any significant recovery from the serious physical and psychiatric conditions.
Been mindful of all the matters referred to above I am of the view that the appropriate award for non-economic loss is $400,000.
(b)Past economic loss
It was submitted on behalf the claimant when assessing the likely economic circumstances but for the accident I would find that the claimant’s pre-accident intention was to establish a business in the beauty therapy industry as a make- up artist. Any assessment it was submitted ought to include the claimant’s likely earnings that would have come from her employment at the time of the accident working for her stepfather. It was further submitted that the claimant was likely to remain in that employment for a maximum of six months and thereafter would have returned to employment as a full-time beauty therapist. Further, and within no more than five years, she would have commenced her own beauty business that would include becoming a make-up artist. When calculating past economic loss credit ought to be provided for the monies earned since the date of the accident by the claimant.
On the other hand, the insurer submits that there is no evidence whatsoever that the claimant would have progressed into her own beauty business and the appropriate manner to calculate past economic loss would be to calculate her pre-accident wage rate over the period since the accident and deduct the likely earnings of about 40 weeks in total at approximately $300 per week. Such would result in the order of $50,000 to which would be added $5500 for loss superannuation contributions.
I agree with the insurer that I have no evidence supportive of the hypothesis that the claimant would have commenced a successful business in beauty therapy. I accept that she undertook some training as a beauty therapist and maintained employment thereafter prior to that business closing in August 2020 some three months prior to the accident. Although it appears that the business may have closed earlier than what the claimant believes as there was only income from it disclosed in the 2020 taxation year and none in the 2021 year which tends to indicate it closed prior to 30 June 2020.
Having secured employment with her stepfather at least two weeks prior to the accident I have evidence that she was earning in the order of $512 per week net from her payslips at the time of the accident. It is not possible to calculate with any precision the claim for past economic loss as I have little evidence as to the precise earnings of the claimant particularly for the last 12 months. Accordingly, I have no alternative other than to adopt the general approach made by the insurer in its submissions and to calculate what will result in a buffer award for past economic loss.
As a starting point I find the claimant would have remained with her stepfather for a period and may well have moved back into her chosen career as a beauty therapist. Whilst the claimant was questioned in relation to providing a history to Dr Bertucen that she did not want to a pursue a career in beauty therapy[23] the claimant could not recall providing that history. Had the claimant remained in employment in the beauty industry the wage details provided by the insurer that are not disputed suggest that her remuneration would be in the order initially $620 net for 15 to 19-year-olds thereafter approximately $800 per week net which potentially would have been available to her from January 2022.
[23] Page 6 Dr Bertucen’s report page 47 [A1]
Having made findings in respect to her strong work ethic I find it was unlikely that she would be unemployed for any significant period and most likely would have maintained her employment with her stepfather until she was able to secure employment in the beauty industry. However, at her current age of 21 it is unlikely that she would have commenced her own business at this early stage of her career. I feel it is more likely that had the accident not have intervened that she would have returned to the beauty industry within three to six months of the accident occurring and would continue to enjoy the level of remuneration provided for the type of work.
There is only a very small chance in my view that the claimant may have decided to pursue qualifications as a veterinary nurse that she subsequently commenced after her initial period off work after the accident. However, the motivation for her doing so may well be in part accident related that directed her to TAFE to commence a course rather than pursuing part-time work as part of her rehabilitation it potentially bringing with it less accountability and additional pressures in the background of her psychological fragility. Regardless, she was unable to endure the physical aspects of the work experience associated with the course and soon ceased that potential qualification.
Had the accident not intervened in my view the claimant would have continued to work at a rate of $512 per week for three to six months and thereafter is likely to have returned to the beauty industry earning at the rate of $620 pw net as an employed beauty therapist for some 39 weeks until her 20th birthday after which she likely would have received approximately $800 pw net. This results in a total amount of approximately $96,500. As to the claimant’s actual earnings such is not easy to discern as there is a dearth of evidence relating to her more recent employment. The claimant appears to have worked close to 12 months in total since the accident out of the two years seven months. The insurer has suggested $300 per week as likely earnings which in my view would appear to be within the likely range of earnings although it is difficult to be in any way precise. Such would result in a net loss in the order of $80,000 to which must be added a component for forgone superannuation contributions which would equate to $8,800.
Accordingly, I award the claimant a buffer of $80,000 for past economic loss and $8,800 for loss of superannuation contributions since the day the accident loosely calculated on the above basis.
(c) Future economic loss
An award for future economic loss it was submitted on behalf of the claimant ought to be grounded on a minimum of the average weekly earnings currently being $1,304.50 per week. A further buffer it was submitted ought to be awarded for the potential loss of opportunity that the claimant would have progressed a successful beauty therapy business as owner and reaped the rewards from it. It was suggested an additional $250,000 representing the lost opportunity was appropriate to be added to the computation of average weekly earnings for the working life either to age 67 or in the alternative to age 70.
The insurer submits that there is evidence that the claimant has a residual capacity in the order of 15 to 20 hours per week that would suggest at least $480 per week earning capacity. The appropriate approach the insurer submits is to provide a loss of in the order of $450 per week net for the next 10 years which equates to approximately $160,000 and thereafter provide an additional buffer of $40,000 to cover the period beyond the next 10 years where relapses may result in some ongoing loss. It was therefore suggested an appropriate award for future economic loss is $200,000 added to which a loss of superannuation contributions at a rate of 14% providing a further $28,000.
Consistent with my approach to past economic loss at this point the claimant is demonstrating a loss in the order of $500 per week however in the beauty industry her potential salary would have increased with age at a substantially higher rate than the likely increase in her residuary earning capacity. In my view the disparity between the claimants earning capacity and her residual capacity as a result of the accident is likely to increase. With appropriate treatment as I have earlier indicated there may be some gains made in respect to her physical and psychiatric status however it also may be the case that the future relapses the insurer suggests periodically may further erode for some periods some or all her current residual earning capacity. On that basis any computation at a perceived loss of $500 per week will most likely under compensate the claimant. There is no evidence in respect to the claimant harbouring an intention to work beyond the normal retirement age of 67 years. If I compute a loss at the rate of $500 per week for 46 years the multiplier is 956.1 and when normal contingencies and vicissitudes are deducted the figure $406,342.50 is achieved.
In my view such a computation to assess an appropriate buffer in that order would serve to under compensate the claimant. As the claimant due to her youth had limited time in the work force prior to the accident it is not possible with any degree of arithmetical accuracy to compute her future economic loss. Further, the quantification of her residual earning capacity is plagued with uncertainties. I agree with the insurer that there needs to be a buffer representing the claimant’s loss. As I have earlier found the claimant in the short period since leaving school as demonstrated a strong work ethic and in my view had the accident not intervened that would have continued. It may well be in the future that she would have aspired to more lucrative positions than been an employed beauty therapist. Similarly, it may well be as a result of the intervention of the accident that she will be forced into periods of unemployment to undertake treatment of her physical or psychological injuries or to try and find a sympathetic employer such as her current employer who is prepared to go to the same lengths as her current employer to cater for her needs in the workplace. I agree with the claimant’s counsel that there is a degree of artificiality in her current employment and that whilst she expresses contentment with an employment in the short term the prospects of continuing beyond that period would appear unlikely. It will be clearly difficult to replicate the flexibility in any future employment.
If I were to assess the claimant’s loss of capacity effectively as total been currently $800 per week a figure after contingencies and vicissitudes a figure of $650,148 is achieved.
When I assess the claimant’s likely residual earning capacity in the background of the restrictions that are due to the injuries sustained in the accident coupled with the unlikelihood of any significant improvement the prospects of maintaining her residual earning capacity at the current level appears to be problematic.
The claimant’s likely net loss would appear to be somewhere in the range of $600 to $800 net per week less some modest residual earning capacity. When assessing the quantum of any buffer ward I also need to factor into that assessment the potential loss of any more lucrative employment in the future that the claimant may well have pursued
In the circumstances it appears to me appropriate award must be made by way of an overall buffer of $550,000 to compensate the claimant future economic loss and I so award. In addition, I propose to award a sum for the loss of superannuation contributions the claimant would otherwise have enjoyed over the period of her working life which at 14% provides a further $77,000.
(d)Future travel expenses
It was submitted on behalf the claimant that ought to be awarded buffer of $3,000 to cover the cost of travel for the future treatment that will be undertaken by the claimant that is said to be necessary future treatment in reports of Drs Bertucen and Porteous.
It was submitted on behalf the insurer that in the circumstances there was no power pursuant to the relevant legislation to make provision for future cost of travel relating to future treatment. No further submissions were made by insurer in respect to the matter.
The MAI Act has provided the claimant with statutory benefits that have included weekly payments of statutory benefits pursuant to Division 3.3 of the MAI Act as well as statutory benefits for treatment and care pursuant to Division 3.4 of MAI Act. Relevantly the claimant’s entitlement to statutory benefits for treatment and care is governed by the following provisions in division 3.4 of MAI Act:
“3.24 Entitlement to statutory benefits for treatment and care
(1) An injured person is entitled to statutory benefits for the following expenses (treatment and care expenses) incurred in connection with providing treatment and care for the injured person –
(a)The reasonable cost of treatment and care,
(b)Reasonable and necessary travel and accommodation expenses incurred by the injured person in order to obtain treatment and care for which statutory benefits are payable
(c)...”
If the claimant can satisfy those pre-conditions that her treatment expenses are reasonable and she has or will incur reasonable and necessary travel expenses then such will continue for potentially five years. Pursuant to s 3.2 (3) of MAI Act payment of benefits for treatment and care will transition to the Lifetime Care and Support Authority of New South Wales (''LCSA")after five years from the date of the accident.
The claimant has bought claim for damages that restricts her from receiving damages beyond economic loss and non-economic loss as prescribed by s 4.3 of MAI Act.
Upon recovery of damages the claimant is required to have deducted from her award the amount of weekly payments of statutory benefits paid to her and her entitlement to any further weekly payments ceases pursuant to s 3.40 of MAI Act.
In this legislative background is now appropriate to review the relevant limits of recovery in damages claim for economic loss. Part of a damages claim for economic loss includes
s 4.5 (1)(b) of MAI Act:“Section 4.5 (1)(b): ‘damages for costs relating to accommodation or travel (not been the cost of treatment and care) of the time prescribed by the regulations,’”
The relevant regulation pursuant to the Motor Accident Injuries Regulation 2017 provides:
“9 Accommodation or travel for which damages may be awarded (section 4.5)
The kind of accommodation or travel for which damages may be awarded (subject to Division 4.2 of the Act) is any accommodation or travel for which the claimant has incurred, or is likely to incur, a cost as a result of the injury caused by the motor accident.”
Travel expenses that have been incurred or will be incurred for future treatment for which statutory benefits for treatment remain payable pending their transfer to the LCSA are prescriptive pursuant to s 3.24 of MAI Act as they must be “reasonable and necessary’’ and be associated with the “reasonable’’ costs of treatment. The entitlement for future travel costs claimable in a damages claim as economic loss are a cost otherwise as a result of the injury caused by the motor accident.
If future travel expenses in a damages claim pursuant to s 4.2 (b) were to include travel expenses associated with future treatment and care then there would have been a need to refer to the cessation of such statutory benefits upon recovery of damages pursuant to s 3.40 of MAI Act in the same way as weekly payments. To do otherwise would permit double recovery of such travel expenses which would also clearly offend the objects of the MAI Act of which I am required to be obedient to when interpreting the two sections relating to statutory benefits and damages in accordance with s 1.3 (4) of the MAI Act.
Future travel expenses in damages claims have previously been sanctioned by the Personal Injury Commission in cases involving the need to attend Country Women's Association meetings by taxi[24] where such past expenses have been paid by the insurer as well as a buffer award representing the difference in value of a return business class airline seat compared to the economy to accommodate a claimant’s inability to sit in an economy seat due to her injuries from Australia to Europe for her honeymoon[25].
[24] Oliver v IAG t/a NRMA Limited [2021]NSWPIC 146 (27 May 2021) Member Cassidy
[25] White v AAMI Limited [2021]NSWPIC 449 (5 November 2021) Member Williams
Travel expenses as claimed by the claimant in this matter for future treatment however in my view falls within a different category and remains within the confines of statutory benefits for treatment and care as set out in the MAI Act.
Accordingly, I do not propose to make any award for future travel expenses as claimed.
ASSESSMENT of DAMAGES SUMMARY
Non-Economic Loss: $400,000
Past Economic Loss: $80,000
Past Loss of Superannuation: $8,800
Future Economic Loss: $550,000
Future loss of Superannuation: $77,000
Fox v Wood: $8,130
Future travel: NIL
Total: $1,123,930
The total damages for economic loss is to be reduced by the agreed figure of the statutory benefits already paid to the claimant in the sum of $56,085.25
COSTS and DISBURSEMENTS
I note costs and disbursement have been agreed and I will submit a cost calculator to the parties disclosing the calculation of the professional costs and agreed disbursements in the matter
LEGISLATION CONSIDERED
· Motor Accident Injures Act 2017;
· Motor Accident Injuries Regulation 2017, and
· Motor Accident Guidelines: CTP Care.