IAG Limited Trading as NRMA v Naidu
[2021] NSWPIC 483
•26 November 2021
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | IAG Limited Trading as NRMA v Naidu [2021] NSWPIC 483 |
| CLAIMANT: | Praneeta Naidu |
| INSURER: | IAG Limited Trading as NRMA |
| MEMBER: | Susan McTegg |
| DATE OF DECISION: | 26 November 2021 |
| CATCHWORDS: | MOTOR ACCIDENTS - Approval of settlement; section 6.23 of the Motor Accident Injuries Act 2017; claimant now 49 years of age; injured in a serious rear end collision; injury to back, neck, full thickness tear of the rotator cuff; right shoulder arthroscopy, surgery, namely rotator cuff repair and debridement of SLAP lesion; unfit for pre-accident work as manufacturing technician; unsuccessful attempt at employment as production operator; ongoing difficulty with overhead activity; shoulder pain; no entitlement to non-economic loss; whole person impairment assessed at 10%; allowance for past economic loss other than period of return to employment; allowance for past loss of superannuation; fit for full time work with restrictions; buffer $200,000 for future loss of earning capacity; allowance for future loss of superannuation benefits; Held – settlement in total sum of $389, 724.90 just fair and reasonable and within the range of likely potential damages assessments; settlement approved. |
| DETERMINATIONS MADE: | 1. This proposed settlement is approved. 2. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. |
Settlement Approval
Issued under section 6.23 of the Motor Accident Injuries Act 2017
Introduction
On 13 January 2018 Ms Praneeta Naidu (the claimant) sustained injury in a serious motor vehicle accident (the accident). Ms Naidu was driving a three-month-old Toyota Camry. As she slowed to drive over a speed hump her vehicle was hit from behind by a utility travelling at speed. Her vehicle was written off.
Ms Naidu has made a claim against IAG Limited Trading as NRMA Insurance (the insurer) of the at fault vehicle, for common law damages.
The insurer accepted liability for Ms Naidu’s claim for statutory benefits and has paid Ms Naidu $86,905.71 by way of statutory weekly benefits and seeks credit for that sum.
The insurer has accepted that Ms Naidu had non-minor injuries and pursuant to Division 3.4 of the Motor Accident Injuries Act 2017 (the MAI Act) she is entitled to payment of reasonable treatment and care for the rest of her life for her accident caused injuries.
It is not conceded Ms Naidu has sustained an injury which has caused a whole person impairment of greater than 10%. This means Ms Naidu is not entitled to recover damages for non-economic loss.
Ms Naidu and the insurer have agreed to settle the claim for lump sum damages for the sum of $389,724.90 calculated as follows:
· Past economic loss ($782.89 x 183 weeks) $143,268.87
· Future economic loss $200,000
· Past loss of superannuation (11%) $15,759.58
· Future loss of superannuation (12%) $24,000
· Tax deducted from statutory payments $6,696.45
· Total $389,724.90
The amount payable by the insurer to Ms Naidu, subject to any refund to Centrelink, after the insurer receives credit for the sum already paid by way of statutory payments of $86,905.71, will be the sum of $302,819.19.
Because Ms Naidu is not represented by a lawyer, her settlement must be approved in accordance with the MAI Act.
The matter was the subject of teleconference on 17 September 2021, 30 September 2021, 17 November 2021, and 26 November 2021. At each teleconference Ms Naidu appeared in person and the insurer was represented by Mr Matthew Barter of Hall & Wilcox, Lawyers. Ms Naidu informed me she did not wish to retain a lawyer to represent her in these proceedings but was aware she could seek legal advice.
I have decided to approve the settlement.
JURISDICTION OF THE PERSONAL INJURY COMMISSION
The Personal Injury Commission (the PIC) was established on 1 March 2021 and the Dispute Resolution Service was abolished by clause 3 of Part 2, Division 2, Schedule 1 to the Personal Injury Commission Act 2020.
I am a member of the Motor Accidents Division of the PIC. Clause 14A(1) of the Personal Injury Commission Regulation 2020 designates the application “pre-establishment proceedings” and clause 14D empowers me to determine those proceedings.
Because of the date of the accident clause 14D(3)(b) provides that the MAI Act and the Motor Accident Guidelines (the Guidelines) continue to apply.
The relevant law
Section 6.23(1) of the MAI Act provides a claim for damages cannot be settled within two years after the accident unless the degree of permanent impairment of the injured person caused by the accident is greater than 10%.
Sections 6.23(2) and (3) of the MAI Act requires approval of the settlement and I am not to approve the settlement unless I am satisfied it complies with any of the requirements of the MAI Act or the Guidelines.
Clause 7.38 of the Guidelines states I must be satisfied as to the following:
(a) the proposed settlement satisfies the timing requirements in s 6.23(1) of the MAI Act;
(b) the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments for the claim were the matter to be assessed by a claims assessor, taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by Ms Naidu, and taking into account any proposed reductions or deductions in the proposed settlement; and
(c) Ms Naidu understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
Documents considered
I have had regard to various documents filed by the insurer as follows:
(a) section 6.22 offer dated 21 July 2021;
(b) email from claimant accepting offer dated 23 July 2021;
(c) report of Dr Breit dated 31 August 2020;
(d) report of Dr Breit dated 28 May 2021;
(e) report of Dr Breit dated 18 October 2021;
(f) operation report of Dr Kuo dated 14 October 2020;
(g) list of wage benefits paid dated 18 July 2021;
(h) notices of Assessment 2016 –2020;
(i) request for Information - Virbac dated 18 July 2019;
(j) Letter of Termination – Virbac dated 1 August 2018;
(k) employment records from Ceva;
(l) letter of Termination from Ceva dated 9 March 2020;
(m) payslip from Virbac dated 7 March 2018;
(n) reports/referrals of Dr Warren Kuo dated 7 May 2018, 20 June 2018, 9 August 2018, 14 October 2020, 27 October 2020, 4 February 2021 and 1 April 2021;
(o) keystone Professionals Vocational Assessment Report 24 February 2021;
(p) medical Questionnaire Dr Kuo 2 February 2021;
(q) clinical records of Penrith Physiotherapy;
(r) Certificates of Capacity dated 16 February 2021 4 March 2021, 22 April 2021, and 6 May 2021;
(s) MRI report dated 22 April 2021;
(t) NSW Police Report 13 June 2018;
(u) clinical records from Healthsmart Medical Centre;
(v) clinical records of Nepean Hospital;
(w) clinical records of Dr Padmanabhan;
(x) clinical records of Rooty Hill Medical Centre;
(y) Keystone Professionals reports dated 22 August 2018, 29 August 2018, 21 September 2018 30 November 2018, 30 October 2018, 26 February 2019, 27 March 2019, 30 April 2019, 6 August 2019, 16 March 2020, 30 October 2020 and 15 December 2020;
(z) email update - Keystone Professionals 5 March 2021;
(aa) CGU Workers Compensation file;
(bb) proposed Settlement Documents undated;
(cc) photographs of the scarring; and
(dd) email from Hall & Wilcox re revised offer dated 23 November 2021.
Pre-accident history
Ms Naidu is now 49 years of age.
Ms Naidu holds a Diploma in Business Computing, a Diploma in Pharmacy Assistance, a Certificate II in Community Pharmacy and a Certificate III in Aged Care.
Ms Naidu has a comprehensive history of employment back to 1998. Since 2010 her employment history has been as follows:
(a) between 2005 and 2009 Ms Naidu worked as a pharmacy assistant;
(b) she worked as an Assistant Nurse at an aged care facility between 2010 to 2011;
(c) between 2011 and 2013 Ms Naidu worked with Landmark Recruitment as a process worker including picking and packing;
(d) between 2013 and 2014 Ms Naidu worked as a picker and packer with Action Workforce;
(e) in 2014 Ms Naidu worked with Momentum Consulting Group as a packer/production worker; and
(f) in 2014 Ms Naidu commenced work with Virbac (Australia) Limited as a process worker. This involved operating vaccine filling machinery in a sterile environment, operating a pallet jack, manually lifting boxes of stock and reaching overhead.
On 12 May 2017 consulted Dr Law in respect of an injury to the right wrist and hand arising out of lifting a heavy lid at work. A workers compensation claim was accepted with a diagnosis of DeQuervain’s tenosynovitis. Ms Naidu had a number of absences from work as a result of this injury before returning to work on suitable duties subject to restrictions as to lifting, pushing and pulling.
An ultrasound of the right hand and wrist on 24 May 2017 disclosed mild capsulitis/synovitis changes in the radioscaphoid joint and possible carpal tunnel syndrome.
On 19 June 2017 Dr Wijayakumar recorded complaints of right-hand pain radiating towards the right side of the shoulder and the neck and right sided neck pain radiating to the right arm. On 25 June 2017 Dr Wijayakumar referred Ms Naidu for an MRI for the right wrist and cervical spine.
Mr Naidu underwent a right shoulder ultrasound on 10 October 2017 which disclosed supraspinatus calcific tendinosis with subacromial bursitis and bursal impingement on abduction.
When reviewed on 4 January 2018 Ms Naidu had returned to full pre-injury duties.
At the time of the accident Ms Naidu worked as a manufacturing technician 38 hours per week with Virbac (Australia) Pty Ltd (Virbac).
Post-accident evidence
Following the accident on 13 January 2018 Ms Naidu attended Nepean Hospital on 14 January 2018 with a history of right leg pain and lateral neck pain.
Ms Naidu consulted Dr Padmanabhan on 15 January 2018. She reported her involvement in the accident and complained of lower back pain with right leg sciatica.
Ms Naidu attended Nepean Hospital on 17 January 2018 with back pain before being discharged to the care of her general practitioner. Nepean Hospital provided Ms Naidu with a referral for a bone scan in respect of an apparent transverse fracture of L2. No fracture was evident in the scan of 1 February 2018.
Ms Naidu again presented to Nepean Hospital on 22 January 2018 with neck pain.
On 22 January 2018 Dr Padmanabhan reported Ms Naidu had presented following an overdose of temazepam. She reported Ms Naidu had been anxious and depressed following the accident due to lower back pain which was still under investigation, and her concern about her inability to work. Ms Naidu was referred to the Nepean Mental Health Service following the overdose of temazepam. She denied any further suicidal ideation and stated she had acted impulsively. Ms Naidu was referred to Penrith Psychology. She was subsequently referred to Melissa Ward at Emu Plains for CBT (cognitive behavioural therapy).
A cervical CT from 25 January 2018 reports a mild broad based disc osteophyte complex at C3/4 with moderate narrowing of the right exit foramen.
Ms Naidu consulted Dr Nguyen at Penrith After Hours Doctors on 3 February 2018 complaining of neck and lower back pain since the accident.
A right shoulder ultrasound of 7 April 2018 reported a full thickness incomplete tear of the rotator cuff as well as bursitis.
On 10 April 2018 Dr Padmanabhan referred Ms Naidu to Dr Kuo, orthopaedic specialist in respect of right shoulder pain present since the accident. Ms Naidu was prescribed analgesia and anti-inflammatories and referred for physiotherapy.
Ms Naidu saw Dr Kuo for the first time on 7 May 2018. He noted complaints of right shoulder pain, worse with overhead activities, weakness and stiffness. He diagnosed right rotator cuff impingement.
A right shoulder MRI report from 25 May 2018 indicates supraspinatus tendinopathy of the entire length and width with a subtle intrasubstance tear sparing the deep articular and bursal fibres without retraction.
Dr Kuo reviewed Ms Naidu on 20 June 2018. He noted some improvement following two months off work. He reported that the MRI confirmed an acute deep fibre avulsion of the supraspinatus tendon together with bursitis and a glenohumeral joint effusion. He recommended further physiotherapy and a cortisone injection but suggested if symptoms did not improve surgery may be required.
Ms Naidu’s employment with Virbac was terminated on 1 August 2018 on the basis she was unfit to perform her pre-injury duties. In their letter of termination dated 1 August 2018 Virbac noted that her pre-injury role as a Manufacturing Technician (Aseptic Filling Operator) was a physically demanding role and the company was not able to accommodate the restrictions recommended by Dr Kuo.
Dr Kuo reviewed Ms Naidu on 9 August 2018 who complained of ongoing pain. Dr Kuo administered an injection and recommended surgery in the form of a right shoulder arthroscopy, subacromial decompression +/- cuff/biceps repair.
Ms Naidu worked with Ceva Animal Health Pty Ltd as a Production Operator between 25 October 2019 and 9 March 2020 earning $830.23 net per week. Ms Naidu did not disclose to this employer her accident-related injury. Ms Naidu did not pass the probation period and a letter from the Production Manager dated 9 March 2020 states her employment was terminated because her performance was not satisfactory.
Ms Naidu confirmed after she ceased work on 9 March 2020, she received payments from Centrelink for a period of time until statutory payments recommenced. Those statutory payments ceased on 14 July 2021 when she again commenced receiving payments from Centrelink.
A mental health plan prepared by Dr Padmanabhan dated 10 March 2020 refers to a diagnosis of depression and a generalised anxiety disorder. Treatment included CBT and medication.
Ms Naidu consulted Dr Breit at the request of the insurer on 24 August 2020. He reported she had pain involving all of her neck radiating into the right shoulder and down the arm. Ms Naidu was experiencing frontal headaches and had difficulty with tasks requiring the overhead use of her right arm. He concluded she had a full thickness cuff tear which was an aggravation of an underlying disease. He recommended surgery, namely, arthroscopic rotator cuff repair.
Ms Naidu underwent surgery, namely a right shoulder arthroscopy, a rotator cuff repair and debridement of a SLAP lesion on 14 October 2020 under the care of Dr Kuo. The surgery was followed by hydrotherapy and physiotherapy.
As of 15 December 2020 Ms Naidu, continued to be certified unfit for work following the surgery. She was undergoing physiotherapy but had returned to driving short distances, she was independent with her personal care but received cleaning assistance.
The claimant underwent rehabilitation with Keystone Professionals following a referral in about August 2018. Wendy Lum of Keystone Professionals provided a report dated 24 February 2021 where a number of potential work options for Ms Naidu were identified. The positions of pathology collector, pharmacy assistant and telephone customer service were identified. For the role of pathology collector, Douglas Hanly Moir was contacted who advised Ms Naidu would be considered eligible for a roll like this. The pay rate is $836 per week for 38 hours per week. There were 25 pathology collector positions advertised in the Sydney region. For the role of pharmacy assistant there were 104 positions available in Sydney. The average full-time wage is $874 per week. For the role of telephone customer service operator there were 882 advertised vacancies. The average full-time wage is $1,196 per week.
Ms Lum noted Ms Naidu was motivated and open to suggestions as to alternate work options and the claimant indicated a desire to return to suitable employment as soon as possible.
In an email dated 5 March 2021 Susan Fogarty of Keystone Professionals reported
Ms Naidu was attending hydrotherapy and physiotherapy two to three times a week. She reported Ms Naidu’s range of movement was excellent. She referred to a report from Dr Kuo in which he approved the commencement of a training program specifically as a pathology collector.Ms Naidu was reviewed by Dr Kuo on 1 April 2021. He noted she was 5½ months post-operative and had been progressing well but in recent weeks had experienced a recurrence of pain in her right shoulder. He recommended a further MRI and continued physiotherapy and hydrotherapy.
Dr Breit reviewed Ms Naidu on 20 May 2021. He reported Ms Naidu continued to have pain over the shoulder cowl and radiating down the right arm a well as in the trapezius to the right side of the neck. Ms Naidu described pain with overhead activity, difficulty lying on her right side at night and difficulty getting her right hand behind her back.
Dr Breit reported that a post-surgical MRI demonstrated the presence of some bursitis, although apparently better than before. He was of the view Ms Naidu had sustained a soft tissue injury to the neck and aggravation of a pre-existing rotator cuff tear. He concluded she was fit for full time work subject to not working above chest height, no forceful or repetitive use of either arm or no lifting in excess of 8 kilograms. Dr Breit assessed a 10% whole person impairment (WPI).
Ms Naidu underwent a cortisone injection on 17 May 2021. Unfortunately, as a result of the COVID lockdown she has been unable to access hydrotherapy since June 2021. During the teleconference on 30 September 2021 Ms Naidu informed me she was still troubled by her shoulder pain.
At the teleconference on 17 September 2021 Ms Naidu informed me she had a scar from the shoulder surgery. Dr Breit had provided reports dated 31 August 2020 and 28 May 2021 but he did not comment on the scarring. However, he assessed a 10% WPI. Accordingly, the insurer agreed to ask Dr Breit to undertake a further assessment for the purposes of undertaking an assessment of the scarring under the TEMSKI scale.
Ms Naidu participated in a telehealth assessment with Dr Breit on 14 October 2021 and he provided a report dated 18 October 2021. Dr Breit reported Ms Naidu continues to suffer from pain over the right shoulder cowl and pain radiating down the arm which she described as burning. When the shoulder pain is bad Ms Naidu experiences neck soreness and tightness and complains of pins and needles involving most of the digits of the right hand but particularly the little finger. She also has sleep disturbance and cannot lie on her side at night. Ms Naidu has difficulty getting her right hand behind her back and with overhead tasks.
Dr Breit concluded the scars are small, well healed, and unremarkable. He did not consider the scars warranted a quantum of impairment according to the Motor Accident Guides and the TEMSKI scale.
Should I approve the settlement
Having reviewed the reports of Dr Breit I am satisfied Ms Naidu has not sustained a WPI excess of 10% and therefore, there is no entitlement to damages for non-economic loss.
I consider the assessment of past economic loss to be appropriate. The insurer has calculated the entitlement to past economic loss at $782.89 net per week. The period from the date of accident on 13 January 2018 until 24 November 2021 is 201 weeks. However, since the accident Ms Naidu was employed at Cevu for a period of 18 weeks. Therefore, past economic loss is calculated on 183 weeks at $782.89 net per week in the total sum of $143,268.87. An additional allowance is made for loss of past superannuation benefits calculated at 11% of the net past wage loss in the sum of $15,759.58. The insurer is to have credit for the sum of $86,905.71 paid in weekly statutory payments.
Ms Naidu made enquiries with Centrelink and was advised there was no obligation to repay the Family Allowance. However, she has also received Job Search payments which may be repayable. At the time of her enquiry Ms Naidu was advised the amount of any repayment was in the region of $13,468.26. That is unlikely to be an exact figure particularly noting Ms Naidu continues to receive payments. Ms Naidu understands the insurer will be required to comply with any Notice of Charge issued by Centrelink by repaying the amount of any charge before releasing the settlement monies to her.
In assessing future economic loss, I must have regard to the provisions of s 4.7 of the MAI Act which states no allowance may be made for future loss of earning capacity unless Ms Naidu establishes that the accident has caused a change in her most likely future circumstances.
In cases such as Medlin v State Government Insurance Commission (1995) 185 CLR and Husher v Husher (1999) 197 CLR 138, the High Court confirmed that the fundamental questions to be determined in a case such as this, are whether Ms Naidu has sustained a loss or diminution in his earning capacity and, if so, whether that loss or diminution will result in economic loss.
Further, it is appropriate to award a buffer when the impact of an injury upon the economic benefit from exercising earning capacity after injury is difficult to determine, as per Penrith City Council v Parks [2004] NSWCA 201. I agree that this is an appropriate case for the award of a buffer. I consider the buffer of $200,000 to be an appropriate sum. I note there is an additional allowance for loss of superannuation benefits calculated at 12% of the future economic loss in the sum of $24,000.
Ms Naidu also understands the settlement, in particular, the allowance for future economic loss may result in a preclusion period during which she may not be entitled to receive Job Search payments.
I am satisfied that Ms Naidu is aware of her right to have her reasonable treatment expenses paid for the remainder of her life. Whilst the insurer is only liable to pay statutory benefits including treatment expenses for five years, thereafter the claim may be transferred to Lifetime Care and Support who will be liable for ongoing reasonable treatment expenses.
I was advised the insurer would not deduct and pay monies to Medicare under the Health and Other Services (Compensation) Act, 1995 (Cwlth) from the settlement sum. However, the insurer is prepared to pay any treatment expenses on any notice of charge raised by Medicare in the event the treatment expenses were reasonable and necessary and related to the injuries sustained by Ms Naidu in the accident.
I advised Ms Naidu if a charge is raised by Medicare in respect of treatment expenses paid by Medicare relating to the injury, she should ask the insurer to pay that charge as part of their obligation to pay reasonable treatment costs.
Conclusion
I find the timing requirements of section 6.23(1) of the MAI Act satisfied where it is now two years since the date of accident.
I am satisfied the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments if the claim was to proceed to assessment taking into account the nature and extent of the claim, the injuries, disabilities, impairments and losses sustained by Ms Naidu.
I am satisfied Ms Naidu is aware she can seek legal advice but does not wish to do so.
I am satisfied Ms Naidu understands the binding nature of the settlement and that she will be precluded from making a further claim for damages arising out of the accident.
I am satisfied Ms Naidu is willing to accept the proposed settlement.Accordingly, pursuant to section 6.23(2(b) of the MAI Act I approve the settlement of
Ms Naidu’s claim for damages in the total sum of $389,724.90.
Susan McTegg
Member (Motor Accidents Division)
Personal Injury Commission
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