Heyward v Moyle

[2013] TASSC 34

[2013] TASSC 34

COURT:                 SUPREME COURT OF TASMANIA

CITATION:            Heyward v Moyle [2013] TASSC 34

PARTIES:  HEYWARD, Paula Kate
  v
  MOYLE, Jai

FILE NO:  240/2009
DELIVERED ON:  15 July 2013
DELIVERED AT:  Hobart
HEARING DATE:  2 July 2013
JUDGMENT OF:  Blow CJ

CATCHWORDS:

Traffic Law – Statutory restrictions or compensation in respect of motor vehicle accidents – Tasmania – Generally – Scheduled benefits – Person requiring daily care – Medical benefits and disability allowance paid before judgment – Reduction of damages.

Motor Accidents (Liabilities and Compensation) Act 1973 (Tas), ss27, 27A.
Aust Dig Traffic Law [1316]

REPRESENTATION:

Counsel:
           Plaintiff:  K E Read SC
           Defendant:  B R McTaggart SC
Solicitors:
           Plaintiff:  Temple-Smith Partners
           Defendant:  Murdoch Clarke

Judgment Number:  [2013] TASSC 34
Number of paragraphs:  17

Serial No 34/2013
File No 240/2009

PAULA KATE HEYWARD v JAI MOYLE

REASONS FOR DETERMINATION  BLOW CJ

15 July 2013

1. This determination relates to a question of law concerning "scheduled benefits" paid by the Motor Accidents Insurance Board before judgment to a plaintiff if that plaintiff is so seriously injured that the Court subsequently certifies, as part of its judgment, that he or she requires daily care. The Motor Accidents (Liabilities and Compensation) Act 1973 ("the Act") contains provisions that require the Board to pay the costs of daily care after judgment when a court so certifies, instead of the award of damages including a component to cover the future costs of daily care. The question for determination is whether, in computing the judgment sum in such a case, the Court must deduct or ignore scheduled benefits paid by the Board before judgment by way of "medical benefits" and "disability allowance". The question is significant if, but only if, such a plaintiff's damages are reduced because of contributory negligence. The Board contends that such payments should be treated as scheduled benefits and brought into account. The plaintiff in this case accepts that payments of disability allowance should be treated as scheduled benefits and brought into account, but contends that payments of medical benefits should not be treated as scheduled benefits and should not be brought into account. On 2 July 2013, I made an order requiring the determination of this issue before the determination of any other issues in the action. I was satisfied that there was a sufficient chance of a finding of contributory negligence being made against the plaintiff to warrant taking such a course.

1. The significance of this issue can be demonstrated by means of a hypothetical calculation.  If the Board, for example, were to spend $400,000 before judgment on the reasonable medical expenses of a plaintiff requiring daily care, and if the trial judge were to decide that that plaintiff's damages were to be reduced by 25% because of contributory negligence then, if the Board's contentions are correct, the result would be as follows:

·    The expenses of $400,000 would be included in the assessment of the plaintiff's damages. 

·    After a reduction of 25% for contributory negligence, the plaintiff's damages would include $300,000 attributable to those expenses.

·    Thereafter, the plaintiff's damages would be reduced by $400,000, representing the full amount paid by way of medical expenses.  As a result, the plaintiff would be worse off by $100,000 than he or she would be if the medical expenses were ignored, as this plaintiff contends they should be.

1. The plaintiff in this action, Paula Heyward, was travelling in a vehicle along Forth Road on the north west coast of Tasmania in the early hours of 14 May 2006.  The vehicle left the road and rolled about 80 metres into a farming property.  She was very seriously injured.  She has sued the defendant, Jai Moyle, alleging that he was driving the vehicle, that she was a front seat passenger, and that the accident was caused by his negligence.  Liability has been disputed on a number of grounds, including contributory negligence. 

1. As a result of her injuries, the plaintiff requires daily care for more than two hours per day, and is likely to require that level of care indefinitely. By virtue of s2(5) of the Act, she is therefore "a person requiring daily care" for the purposes of the Act. The relevant provisions in the Act, and in the regulations under the Act, can be summarised as follows:

· Section 23(1)(a) provides that the Board "must pay the benefits prescribed by the regulations if a person who is a resident of this State suffers personal injury resulting directly from a motor accident and … the motor accident occurs in this State".

· Such benefits are known as "scheduled benefits". In s2(1) of the Act, "scheduled benefits" is defined to mean "the benefits specified in the regulations".

· When a court gives judgment for damages in respect of personal injury resulting directly from a motor accident, and the plaintiff requires daily care as a result of the injury, the court is required, as part of its judgment, to certify that the plaintiff requires daily care: s27A(2)(a).

· When a court certifies in accordance with s27A(2)(a) that a person requires daily care, the Board is required to pay that person "medical benefits or disability benefits for so long as the person needs those benefits because of the personal injury …": s27A(4).

· In s2(1) of the Act, "medical benefits" is defined to mean "medical benefits referred to in the regulations".

·    Prior to 1 March 2010, the Motor Accidents (Liabilities and Compensation) Regulations 2000 were in force. Regulation 8 thereof provided, "The benefits payable by the Board under section 23(1) of the Act and the provisions in accordance with which those benefits are payable are specified in Schedule 1."

·    In those regulations, Schedule 1, Part 2, cl 1(1) provided, "Subject to this Part, where a person suffers personal injury resulting directly from a motor accident, all the expenses reasonably and necessarily incurred by the person or on his or her behalf for the provision of the treatment required by him or her within the Commonwealth as a result of the injury are payable as medical benefits."

·    Since 1 March 2010, there have been identical provisions in the Motor Accidents (Liabilities and Compensation) Regulations 2010: reg9, and Schedule 1, Part 2, cl 1(1).

· Under s27A(2)(b), when a plaintiff requires daily care, the court is required not to include in the damages it awards "any amount in respect of the daily care which that person requires … after the date of judgment" that will be recoverable under s27A(4) by way of medical benefits or disability benefits.

· Under s27(1) of the Act, as a general rule, when a plaintiff is entitled to recover damages in respect of a personal injury, and "a scheduled benefit" has been paid pursuant to the Act in respect of that injury, that payment "shall, so far as it extends, be taken to be a payment in or towards the discharge of that liability, and the amount of those damages shall be reduced accordingly".

· Section 27(2) of the Act provides that s27(1) "does not apply in respect of medical benefits, or disability benefits, paid in accordance with section 27A(4)."

1. Counsel for the plaintiff correctly observed that the scheme of the Act, in relation to persons not requiring daily care, is that an injured person is entitled to recover either damages or statutory benefits, but not both. He correctly observed that s27(1) achieves that result, and has the effect of requiring that the deduction of an amount paid by way of scheduled benefits is to be made after any reduction for contributory negligence. He observed that a similar regime exists under workers compensation legislation. He referred me to Hall v Grimwood [1979] Tas R 220, and to Union Steamship Company of New Zealand Ltd v Dickson [1966] Tas SR 44. All of that is uncontroversial.

1. Counsel for the plaintiff went on to argue that, in a "daily care" situation, the intention of the legislation is that a successful plaintiff is entitled to both damages and statutory benefits, including statutory benefits paid before judgment.  He argued that there would be an inconsistency if pre-judgment statutory benefits were required to be taken into account in assessing damages but post-judgment statutory benefits were not.  In his written submissions, he pointed out that the regulations impose a ceiling of $400,000 on the medical benefits and disability benefits payable in respect of persons not requiring daily care, but that there is no such limit in respect of persons requiring daily care.  That limit is imposed by the 2010 regulations, Schedule 1, Part 2, cl 2.  There was an identical provision in the 2000 regulations: Schedule 1, Part 2, cl 2.

1. In both the 2000 regulations and the 2010 regulations, a distinction is drawn between "disability allowances" and "disability benefits".  Disability benefits relate to the cost of artificial limbs, other prostheses, medical or surgical aids or appliances, and other aids, appliances and equipment.  In each set of regulations, Schedule 1, Part 6, cl 1 provides that such expenses as are reasonably incurred for the provision of such items are to be payable as disability benefits.  Disability allowances, on the other hand, do not relate to expenditure.  They are paid on a weekly basis to injured persons who have become unfit for work, or unfit to carry out household duties that they normally carried out.

1. In his written submissions, counsel for the plaintiff drew attention to the wording of s27(1) and (2) of the Act. Those subsections read as follows:

"(1)     Except as provided by subsection (2), if a liability has been incurred for the payment of damages to a person in respect of a personal injury the payment to that person of a scheduled benefit in respect of that personal injury shall, so far as it extends, be taken to be a payment in or towards the discharge of that liability, and the amount of those damages shall be reduced accordingly.

(2) Subsection (1) does not apply in respect of medical benefits, or disability benefits, paid in accordance with section 27A(4)."

1. Counsel for the plaintiff correctly observed that the reference in s27(1) to the reduction of damages would suggest that that subsection was only concerned with scheduled benefits paid before judgment. But, if that is so, it is curious that an exception is created by s27(2) in relation to payments under s27A(4), which provides for payments of medical benefits and disability benefits after judgment. Counsel for the plaintiff argued that, in the light of s27(2), s27(1) should be read as requiring only scheduled benefits other than medical benefits and disability benefits to be brought in to account in relation to a plaintiff who requires daily care. He argued that the Act is beneficial legislation, and that it should be given an interpretation favourable to the class of persons intended to be benefited, namely injured persons requiring daily care.

1. I accept that s27(2) is curiously worded, in that it purports to create an exception, in relation to payments after judgment, in respect of a provision that only applies to payments before judgment. However I reject the submissions of counsel for the plaintiff.

1. My analysis of the relevant statutory provisions is as follows:

· The provision that requires damages to be reduced, when it applies, namely s27(1), requires a reduction in relation to the payment "of a scheduled benefit".

· One must therefore consider the meaning of "scheduled benefit". In s2(1), "scheduled benefits" is defined to mean "the benefits specified in the regulations".

·    One must therefore consider whether the benefits paid before judgment to, or in respect of, a person requiring daily care are "benefits specified in the regulations".

·    Under the 2010 regulations, Schedule 1, Part 2, cl 1(1), the expenses incurred for the provision of treatment required by the plaintiff within the Commonwealth as the result of the injury are "payable as medical benefits".  The situation was the same under the 2000 regulations.  The $400,000 limit imposed by cl 2 makes no difference to the character of such benefits, whether they are payable in respect of a person requiring daily care or a person not requiring daily care.

·    Under the 2010 regulations, Schedule 1, Part 6, cl 1, the expenses incurred for the provision of artificial limbs and so forth are "payable as disability benefits". 

· It follows that all medical benefits and disability benefits paid before judgment constitute scheduled benefits paid in respect of the plaintiff's personal injury, and must be taken into account by reducing her damages (if she recovers damages) pursuant to s27(1).

·    Any medical benefits or disability benefits paid after judgment also fall within the definition of "scheduled benefits". 

· The effect of s27(2) is to make it clear that there is to be no reduction of damages in respect of medical benefits or disability benefits paid "in accordance with section 27A(4)". Section 27A(4)(a) requires the Board to pay medical benefits or disability benefits only if a court certifies in accordance with s27A(2)(a) that a person requires daily care. Section 27A(2)(a) provides for such certification to be given by a court only as part of its judgment. It follows that the "exception" provided for in s27(2) relates only to post-judgment payments of medical benefits and disability benefits.

1. There is no ambiguity in any of the provisions that I have referred to.  There is therefore no scope for the application of the principle that, where there is ambiguity in a piece of beneficial legislation, an interpretation favourable to the class of persons intended to be benefited should be preferred.  It was open to the legislature to construct a scheme whereby scheduled benefits paid before judgment were to be taken into account in assessing damages, and those paid after judgment were not.  From one point of view, such a scheme involved an inconsistency, but that is clearly what Parliament intended.

1. The situation in relation to disability allowances is different from the situation in relation to medical benefits and disability benefits. By virtue of s27(3), as a general rule, the Board is not required to make any further payments to a plaintiff by way of scheduled benefits after judgment. The only exception is that created by s27A(4), but it provides only for the payment of medical benefits and disability benefits after judgment. Since disability allowances constitute a species of scheduled benefits that is different from disability benefits, no disability allowances are payable after judgment.

1. The issue for determination in this case relates to two agreed facts, expressed by the solicitors for the parties as follows:

"2As of 14 February 2013, the Motor Accidents Insurance Board ('the Board') had paid the following expenses reasonably and necessarily incurred by the plaintiff or on her behalf for the provision of the treatment required by her, within the Commonwealth, as a result of the injuries:

Hospital expenses  $226,345.04

Ambulance expenses  4,527.88

Medical and associated expenses            800,648.78

Rehabilitation expenses  55,466.14

$1,086,987.84

3…

4As a result of the injuries the plaintiff has been wholly disabled from engaging in the employment in which she was engaged as at the date of the accident and any other employment or occupation for which she would otherwise have been reasonably suited by education, training, experience or ability.

As a result of that disablement the Board paid to the plaintiff disability allowance in the sum of $78,973.79."

1. Because of the words "reasonably and necessarily incurred" in the agreed facts, no question arises as to whether any of the payments in question were not really payments of scheduled benefits at all – a situation that was found to exist in Hornery v O'Neal (1995) 21 MVR 457.

1. The issue for determination is expressed as follows:

"Are the payments made by the Board and recorded at 2 and 4 above required to be brought to account in the event that the plaintiff is found entitled to damages?"

1. For the reasons stated, I determine that, in the event that the plaintiff is found entitled to damages, the payments recorded in pars2 and 4 of the agreed facts are required to be brought into account.