Insurance Australia Limited t/as NRMA Insurance v Dash

CERTIFICATE OF DETERMINATION OF MEMBER
Citation:	Insurance Australia Limited t/as NRMA Insurance v Dash [2022] NSWPIC 550
Claimant:	Graeme Dash
insurer:	Insurance Australia Limited t/as NRMA Insurance
Member:	Alexander Bolton
DATE OF DECISION:	6 October 2022
CATCHWORDS:	MOTOR ACCIDENTS - Application for settlement approval; claimant not legally represented; claimant injured on 16 November 2021 when insured driver exited driveway onto the road and collided with the claimant riding his motorbike; claimant suffered fracture of the right neck of his femur and requiring a prosthesis; insurer conceded whole person impairment greater than 10% and settlement able to be considered within two years of accident; medical evidence obtained indicating possibility of accelerated arthritis and replacement of prosthesis; initial offer of settlement of $250,000 all-inclusive not accepted by member; further negotiations undertaken between the parties and matter resolved $320,000 all inclusive; Held – settlement approved for $320,000 all inclusive.
determinations made:	1. Pursuant to s 6.23(2)(b) of the Act, the proposed settlement of the claim of Mr Dash for damages is approved.

STATEMENT OF REASONS

INTRODUCTION

Background

This is a claim for damages made by Mr Dash which comes before me for approval following a settlement reached between the parties.
Mr Dash is not represented by an Australian legal practitioner.
Mr Dash was involved in an accident on 16 November 2021. The accident occurred when the driver of the insured car exited from his driveway onto the road and collided suddenly and without warning with Mr Dash who was riding his motorbike. Mr Dash was unable to avoid the collision and fell off his bike and onto the road. In the process he fractured the right neck of his femur.
Mr Dash was taken by ambulance to hospital and subsequently had a right total hip arthroplasty on 18 November 2021. He was discharged from Gosford Hospital on 23 November 2021 and thereafter had fortnightly physiotherapy sessions at Wyong Hospital. His mobility has been considerably limited.
The insurer has admitted liability.
The insurer has also conceded that Mr Dash is entitled to an assessment of non-economic loss.
The insurer made an offer of settlement to Mr Dash of $250,000 all inclusive and the matter came before me for approval of the settlement on 3 June 2022. At that time, I indicated that there was no medical practitioner before me for my assistance. I said that I needed evidence from a medical expert about the likelihood of further deterioration of the hip replacement, the possibility of arthritis in the possibility of any need for future hip replacement/s.
I said to the parties that it was arguable that if there was a likelihood of arthritis in the future and further pain and suffering with the need of a hip replacement then the offer that had been made might not be satisfactory. Consequently, I stood the matter over so that further evidence could be obtained by the insurer.
The insurer then arranged for Mr Dash to be examined by Dr Harrington. His report was then uploaded to the portal and considered by me. In this report Dr Harrington said that Mr Dash should keep in regular contact with his surgeon for the next three years but provided no reason for this. Dr Harrington also provided no information about the life expectancy of the prosthesis and when or if it might need replacement in the lifetime of Mr Dash. Dr Harrington also suggested that as a consequence of the hip replacement, Mr Dash might develop accelerated arthritis of his right knee in his lifetime.
At the next preliminary conference Mr Dash said that he still needs physiotherapy to improve his flexibility which he says is limited. He said that the surgery has left him with considerable ongoing difficulties which include that he cannot put on his socks and for which he needs assistance, he can tie his shoelaces but only with difficulty, he requires his wife to wash his feet and he cannot cut his toenails. In summary, he can only bend over with considerable difficulty. Mr Dash said that before the accident he used to walk 4 to 6km per day but now he rarely does this. He said that he has no confidence in his hip and its ability and he is very concerned not to wear it out.
At this preliminary conference on 10 August 2022 I said to the insurer that further clarification was required from Dr Harrington. I said that it appeared clear to me from the comments of Dr Harrington and also of Mr Dash that the offer of settlement was not reasonable and not something that I could approve.
I stood the matter over to a further preliminary conference on 20 September 2022 so that additional information and clarification could be obtained. I suggested at the time to the insurer that it might be sensible for the parties to enter into further negotiations in light of the comments of Dr Harrington.
The insurer then obtained a supplementary report from Dr Harrington. At the time this report was uploaded to the portal, the insurer indicated that its offer of settlement of $250,000 all inclusive would not be increased.
Concerning the longevity of the hip replacement, Dr Harrington had only partially addressed this in his report of 17 August 2022 by saying that the prosthesis will “hopefully” last for the lifetime of Mr Dash. However, he acknowledged that problems may occur such as loosening or dislocation and that revision surgery may be required.
Dr Harrington, in his supplementary report, provided an example of someone whom he had operated on in 2011 but who had suffered a dislocation getting out of the bath. The initial operation was 11 years ago but following the dislocation, revision surgery was required. I consider this a very real potential problem and consideration for Mr Dash.
Furthermore, the fact that Dr Harrington indicated that as a result of the hip replacement, Mr Dash might develop accelerated arthritis then this raises the possibility, although not necessarily a probability, that a knee replacement might be required.
At the next preliminary conference on 20 September 2022 a new claims officer for the insurer appeared, Ms Vicki Zogopoulos. I informed Ms Zogopoulos having considered the additional information provided by Dr Harrington, that I did not consider that the current offer of settlement made by the insurer was satisfactory. On that basis I said that the offer of $250,000 all inclusive could not be approved by me. Ms Zogopoulos requested that the matter go over for two weeks as she was able to review the claim “with fresh eyes”. Her attention to the claim has been very helpful.
I discussed with Ms Zogopoulos at the preliminary conference that the insurer should consider a number of other aspects of the claim. This was so that it might understand why I considered the current offer of settlement of $250,000 as unsatisfactory and not capable of approval by me. This included the possibility that Mr Dash might need to downsize his property. That would require him to sell his home and incur agent’s fees and to purchase a new home, incurring stamp duty. Whilst these are usual expenses of someone buying and selling a home, the insurer needed to consider that Mr Dash might well have regarded that he would stay in his home in perpetuity in the normal course of events had this accident not occurred. Therefore, these additional expenses potentially need to be taken into account by the insurer in forming part of any allowance for economic loss. In this regard I note the provisions of s 4.5 of the Motor Accident Injuries Act 2017 (the Act). I suggested to the insurer that it might not be unreasonable to consider such expenses as coming within those provisions, as a potential consideration for further negotiations and in light of the fact that the insurer had previously informed me that the offer of settlement $250,000 all inclusive would not be increased.
At the time of the next preliminary conference on 5 October 2022, I was informed the insurer has made a further offer of settlement of $320,000 all inclusive and that Mr Dash had accepted this. I was also provided with a copy of the proposed deed of settlement.
I informed the parties that I was prepared to approve this settlement offer of $320,000 all inclusive.

LEGISLATIVE BACKGROUND

The Personal Injury Commission (the Commission) was established on 1 March 2021 and the Dispute Resolution Service (DRS) was abolished by cl 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 Commission and cl 14B(1) of the Personal Injury Commission Regulation 2020 designates GIO’s application ‘pending proceedings’ and cl 14B(3) empowers me to determine those proceedings.
Because of the date of the accident, cl 14B(4)(c) provides that the Act and the Motor Accident Guidelines (the MA Guidelines) continue to apply.
Section 6.23 of the ct says;
1.     “(1) A claim for damages by an injured person cannot be settled within 2 years after the motor accident unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.
2.     (2)   A claim for damages cannot be settled unless-
3.(a)     the claimant is represented in respect of the claim by an Australian legal practitioner, or
4.(b)     the proposed settlement is approved by the Commission
5.     (3)   The Commission is not to approve the settlement of a claim unless satisfied that the settlement complies with any applicable requirements or of or made under this Act or the Motor Accident Guidelines”
Clause 7.38 of the Guidelines says that in considering the settlement I must consider whether:
6.     (a)   the proposed settlement satisfies the timing requirements in section 6.23(1) of the Act;
7.     (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 (member of the Commission), taking into account any proposed reductions or deductions in the proposed settlement, and
8.     (c)   the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.
Clause 11 of the Commission’s Procedural Direction MA3 provides that the Application must include:
(a)      the amount of the proposed settlement and a breakdown of the amount allowed for each head of damage;
(b)     the amount of any reductions in the proposed settlement;
(c)      the amount of any advance payments made, and
(d)     the evidence, documents and materials relevant to the assessment of the proposed settlement figure.

REVIEW OF THE EVIDENCE

Initially the insurer had no medical evidence in support of the claim other than the clinical notes of Gosford Hospital. At my request, an expert orthopaedic surgeon’s report was obtained by the insurer from Dr Harrington. His two reports and opinions have been discussed in my background information to respect to this claim and the settlement.
The insurer provided also, a copy of an ambulance report, clinical notes of the general practitioner (GP) of Mr Dash, physiotherapy AHRR reports and Benchmark Rehab initial needs report and progress reports.

SHOULD I APPROVE THE SETTLEMENT

Initially, after medical evidence had been provided, I indicated to the parties that I was not prepared to approve the settlement offer of $250,000 all inclusive and I explained why. Further negotiations took place between the parties and I was then informed that settlement had been reached in the amount of $320,000 all inclusive.
In the course of the preliminary conferences undertaken in this matter I had explained to Mr Dash that he is not legally represented and is able to if he desires, to retain a lawyer to represent him. I also explained that my role was to consider the offer in light of the fact that he was not legally represented. I informed Mr Dash that he could also enter into further negotiations for settlement of the claim.
I explained to Mr Dash and am satisfied that he is aware that his statutory benefits claim continues for life and that the insurer is required to pay for any reasonable and necessary accident related;
(a)     Medical (GP and specialist) follow up consultations and future surgery, if his injuries come to that.
(b)     Medication (over the counter or prescription).
(c)     Domestic assistance, care and rehabilitation which may be needed.
The offer of $320,000 all inclusive, made by the insurer represents an assessment of non-economic loss.
Mr Dash is entitled to noneconomic loss which is defined in the Act to mean pain and suffering, loss of amenities of life, loss of expectation of life and disfigurement.
There is no suggestion in the medical evidence that the life expectancy of Mr Dash has been reduced because of his injuries.
Mr Dash has had to give up his pastime of riding his motorbike as a result of the accident. I am satisfied through the course of discussing this claim at the three preliminary conferences that this is a great disappointment to Mr Dash.
Mr Dash has retired from work and was retired at the time of the accident.
While the accident occurred on 16 November 2021 and this settlement is within two years of that occurrence, the insurer concedes that the degree of whole person impairment of Mr Dash is greater than 10%. The claim can therefore be settled in that time.
The insurer has confirmed that there will be no deductions from the settlement amount.
Mr Dash confirmed that as a result of the accident he has not been in receipt of social security benefits.
The insurer has confirmed that Mr Dash will not be out of pocket for any amount that has to be repaid to Medicare.
I am therefore satisfied that the proposed settlement figure of $320,000 all inclusive is an appropriate one and that it complies with the requirements of cl 7.304.2 of the Guidelines, in that it is;
“... just, fair and reasonable and within the range of likely potential damages assessment for the claim were the matter to be assessed by a [member], taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by the claimant, and taking into account any proposed reductions or deductions in the proposed settlement.”
Pursuant to s 6.23(2)(b) of the Act, the proposed settlement of the claim of Mr Dash for damages is approved.

[2022] NSWPIC 550

6 October 2022