Insurance Australia Limited t/as NRMA Insurance v Everett
[2023] NSWPIC 40
•3 February 2023
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | Insurance Australia Limited t/as NRMA Insurance v Everett [2023] NSWPIC 40 |
| Claimant: | Anne Everett |
| insurer: | Insurance Australia Limited t/as NRMA Insurance |
| Member: | Belinda Cassidy |
| DATE OF DECISION: | 3 February 2023 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act2017; damages claim; approval of settlement under section 6.23; claimant self-represented; claimant run over in driveway of own home; claimant sustained undisplaced fracture of pelvis and fractured left elbow requiring surgery and hardware; claimant worked in aged care and while she returned to light duties for a short period her employment ended as she would not be able to return to full duties; settlement offer included $82,760.90 for past loss of earnings and $60,000 for the future; entitlement to non-economic loss explored with further medico-legal obtained; claimant soon to turn 67 but had no plans regarding work or retirement; Held – settlement approved, and parties reminded of claimant’s entitlements under sections 3.24 and 3.26. |
| determinations made: | CERTIFICATE OF DETERMINATION SETTLEMENT APPROVAL 1. The claimant and the insurer have agreed to settle Ms Everett’s claim for damages in the sum of $142,760.90. 2. The proposed settlement is approved in accordance with s 6.23 of the Motor Accident Injuries Act2017. |
STATEMENT OF REASONS
Introduction
On or about 30 July 2020, Anne Everett was involved in an accident in the driveway of her own home in Albury. She provides the following description of the accident in her claim form:
“I pulled my car up the driveway to the gates of my home …I exited the car and opened the driveway gates. I was returning to the car when my son came to the car and got into the driver’s seat. I was standing beside him with the car door open. My son then reversed the car quickly and as I was still standing in the open doorway, I was thrown with force onto the road way.”
Ms Everett sustained significant injuries including a fractured pelvis, fractured left elbow and a head injury (laceration and concussion).
Following the accident, Ms Everett made two claims under the Motor Accident Injuries Act 2017 (the MAI Act) against her own insurer:
(a) a claim for statutory (income support and treatment) benefits[1], and
(b) a claim for lump sum compensation or damages.[2]
[1] The application for personal injury benefits is dated 20 August 2020 and is document R1 at page 1 of the insurer’s bundle of documents.
[2] The application for damages is dated 8 April 2022 and is document R6 at page 135 of the insurer’s bundle of documents.
NRMA accepted liability for the statutory benefits claim and pain Ms Everett weekly income support type benefits as well as paying for Ms Everett’s treatment and care needs. NRMA has also accepted liability for her damages claim.[3]
[3] The insurer’s liability notice for the damages claim is dated 24 May 2022 and is document R9 at page 135 of the insurer’s bundle of documents. The statutory benefits liability notices are dated 31 August and 4 November 2020 and are documents R2 and R3 at pages 6 and 9 of the insurer’s bundle.
NRMA made an offer to settle Ms Everett’s claim for damages and she has accepted that offer. Because Ms Everett does not have a lawyer representing her, the settlement she has reached with NRMA must be approved in accordance with the relevant provisions of the MAI Act.
The settlement was referred to the Personal Injury Commission (the Commission) and the proceedings have been allocated for me to consider whether the settlement should be approved. The final settlement figure was $142,760.90 and I have determined I will approve the settlement.
LEGISLATIVE FRAMEWORK
Settlement approval
Common law damages are awarded on a once and for all basis. An injured person cannot usually make a claim for further damages once a claim has been settled.
Section 6.23 of the MAI Act says:
“(1) repealed
(2) A claim for damages cannot be settled unless—
(a)the claimant is represented … by an Australian legal practitioner, or
(b) the proposed settlement is approved by the Commission.
(3) The Commission is not to approve the settlement of a claim unless satisfied that the settlement complies with any applicable requirements of or made under this Act or the Motor Accident Guidelines.”
Section 6.23(2)(b) is an important safety net for persons settling a damages claim without legal advice.
Clause 7.37 of the Motor Accident Guidelines[4] (the Guidelines) says that in considering the settlement the Commission must consider whether:
“(a) repealed
(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 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;
(c) the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner, and
(c) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.”
[4] The current version is version 9 effective 15 January 2023.
Claims for damages
The MAI Act limits the types of damages that can be awarded to any injured person and the amounts of those damages. The available heads of damage are set out below.
Damages for non-economic loss
Damages are available for non-economic loss if the injured person has a whole person impairment (WPI) of greater than 10%. Whole person impairment is to be assessed in accordance with the Motor Accident Permanent Impairment Guidelines (the Guidelines)[5] which are largely based on the American Medical Association’s Guides to the Evaluation of Permanent Impairment, Fourth Edition (AMA 4 Guides).
[5] Section 133 and see chapter 6 of the Guidelines.
The insurer obtained a report from a medico-legal expert that the claimant had a WPI of 2% and therefore did not include any award for non-economic loss in its offer.
Non-economic loss is defined in the MAI Act[6] as including pain and suffering, loss of amenities of life, loss of expectation of life and disfigurement or scarring (which includes surgical scarring).
[6] Section 1.4.
The current maximum amount for non-economic loss damages allowed under the MAI Act is $605,000.[7]
[7] Section 4.13 and the amount is adjusted on 1 October every year.
Damages for economic losses
Section 4.5 of the MAI Act limits the types of damages that can be awarded for economic losses to:
(a) damages for past or future economic loss due to loss of earnings or the deprivation or impairment of earning capacity, and
(b) damages for costs relating to accommodation or travel (not being the cost of treatment and care) of a kind prescribed by the regulations, and
(c) damages for the cost of the financial management of damages that are awarded, and
(d) damages by way of re-imbursement for income tax paid or payable on statutory benefits arising from the injury that are required to be repaid on an award of damages to which this Part applies.
The insurer’s offer did not include the cost of financial management which is usually only awarded to persons who have limited capacity and cannot make financial decisions on their own. This is not the case with Ms Everett.
The insurer has made allowances for past and future loss of earnings (including lost superannuation). There was no re-imbursement of taxation paid by the insurer on the weekly statutory benefits paid to the claimant because the claimant was the owner of the car and the greenslip policy holder.
The insurer has not made any allowance for past or future accommodation or travel costs. The insurer’s expert had noted that the claimant would require breaks during long distance car trips and would find it easier to use a car with automatic transmission. This was brought to the claimant’s attention in case a car with automatic transmission would incur additional expense for the claimant, but no claim was made.
I note s 4.5 of the MAI Act does not allow a claimant to be awarded damages for economic losses related to treatment and care needs as these continue to be paid under the statutory benefits claim.
Review of the evidence
The claimant’s application for personal injury benefits stated that the claimant was employed as a lifestyle coordinator for an aged care organisation. She was paid $1,298.87 gross per fortnight and had been unable to return to work.
The ambulance report records the claimant was sitting on the side of the road with her daughter complaining of pain and restriction of movement of the left elbow, pain in her left hip and there was a laceration to the back of her head.
The insurer has provided copies of a number of rehabilitation plans and requests for allied health services which I have considered.
A report from Ms Barfoot at Rehab Management Pty Limited dated 16 October 2020 documents symptoms of pain and a need to use a walking stick because of the pain in the pelvis, pain and an inability to lift with the left upper limb and she was diagnosed with concussion, and she reports she was easily fatigued. A number of recommendations were made with regards to care and assistance and return to work strategies.
The insurer organised for the claimant to be examined by Dr Doig an orthopaedic and trauma surgeon and he has provided two reports.
In his first report dated 26 October 2021, he noted he had been provided with limited treating medical evidence and so his understanding of what injuries the claimant had sustained was largely based on her history and the insurer’s documents.
The claimant reported that she returned to work in January 2021 but was terminated on 9 September 2021 as she was unable to return to full duties. The claimant had been unable to find alternative employment.
Dr Doig has a history that the claimant has no symptoms flowing from her pelvic fracture but that she continues to experience weakness in the left arm. The claimant was not using pain killers but was at that time still seeing a physiotherapist and had 19 sessions.
Dr Doig recorded that the claimant lives in a house with a garden and that NRMA provides two hours of gardening assistance per month. One of the claimant’s children lives with Ms Everett and receives National Disability Insurance Scheme (NDIS) funding which the claimant has utilised to help the family unit.
On examination Dr Doig noted the claimant did not limp and had a normal range of hip motion. There were no signs of radiculopathy or non-verifiable radicular signs. He noted the claimant’s surgical scar (10cm over the elbow) and mildly reduced elbow flexion. Wrist movements were normal and there was no neurological deficit in the upper limbs.
He expressed the view the claimant has a 2-5 kg lifting restriction with the left arm, would require breaks from long distance driving and would find it easier in an automatic car. He was of the view she would require long term assistance at home.
He assessed WPI of the upper extremity at 1% and 1% for the claimant’s scarring. He noted the pelvic fracture had healed and was asymptomatic.
In a second report dated 25 November 2022 Dr Doig noted the claimant was more active and she had tried to return to swimming. She had noticed issues with her left shoulder and had weakness in her left hand. She had continued aching in the left elbow and “niggling discomfort” in the left groin.
The claimant’s gardening assistance had ceased but the claimant’s daughter was still receiving NDIS benefits which assisted the claimant.
Dr Doig indicated that the claimant’s limitation on activities would continue unchanged with respect to her left arm.
Dr Doig examined the claimant’s shoulder and noted mild restricted motion in almost all planes of movement (other than external rotation). His examination of the forearm indicated a possible “irritable ulnar nerve”. There was some weakness in the hand, but sensation was intact and there was no restriction of movement in the fingers or thumb.
He considered the claimant’s left shoulder issues to be a result of the accident and the fractured left elbow and “longitudinal axial-compression” and a potential ulnar-nerve injury. He recommended further tests including nerve conduction studies and a shoulder ultrasound.
Dr Doig expressed the view the claimant required continued assistance.
Ms Everett queried whether she should have the investigations recommended by Dr Doig. I reminded Ms Everett that she had two claims – a damages claim (the one before me) and a statutory benefits claim which continues for life. Ms Everett’s statutory benefits claim would cover all future treatment and care needs including the tests recommended by Dr Doig and the gardening and domestic assistance he says she needs to help her with her activities of daily living. The only provisos are that the treatment and care must be reasonable and necessary and relate to the injuries sustained in the accident.
The documentation from the insurer suggests that some of the claimant’s domestic assistance needs are being met by the NDIS scheme. I note that the claimant’s daughter received NDIS benefits which would be for the claimant’s daughter’s benefit and presumably not for the claimant’s benefit. I remind the parties that the claimant has entitlements under s 3.24 for services she needs and under s 3.26 for her loss of capacity to provide gratuitous domestic services to her dependents which would include her child.
Consideration of the settlement
The offer of settlement
The claimant accepted the first offer made by the insurer. The claimant had not attempted to negotiate a higher offer. At the second teleconference, the insurer increased the offer to take into account the effluxion of time since the first teleconference.
The final offer from the insurer is $142,760.90 made up of:
(a) past loss of earnings $82,760.90, and
(b) future loss of earning capacity $60,000.00
The insurer indicated it would deduct the sum of $48,998.55 from that sum on account of weekly benefits (lost wages) paid to date. The insurer indicated there was no Medicare payback as all medical expenses have been paid as statutory benefits and the claimant indicated there were no Centrelink benefits paid.
The past loss of earnings was calculated on the basis that:
(a) the claimant earned $595.90 per week and accrued $65.54 in superannuation contributions per week;
(b) she had been unable to work since the accident and that it is 130 weeks since the accident, and
(c) from that should be deducted what the claimant did earn in the period that is the sum of $3,227.47.
The claimant agreed with the sums representing her pre-accident earnings and my review of the claimant’s earnings information suggests the figure arrived at by the insurer with some minor rounding is correct.
Potential entitlement to non-economic loss
At the first teleconference, I had Dr Doig’s first report. The claimant has been assessed by Dr Doig as having a 2% WPI – 1% for scarring and 1% for the loss of movement of the elbow joint.
Entitlement to non-economic loss depends upon a finding of WPI greater than 10%.
In a February 2021 allied health request there was mention of range of motion deficits in Ms Everett’s left shoulder. Ms Everett confirmed at the first teleconference that she has trouble in the left shoulder which she relates to the injury sustained to her left elbow.
There are six planes or axis of movement in the shoulder – flexion, extension, abduction, adduction, internal rotation and external rotation. In the allied health request, there are three measurements for the left shoulder provided – 90 degree abduction (which translates to a 4% upper extremity impairment or UEI), 90 degree forward flexion (a likely 6% UEI), 35 degree external rotation (a possible 1% UEI). It is unknown whether there was any impairment to the other planes of motion but the three that were given suggested an upper extremity impairment (as at February 2021) of 11% which would convert to a WPI of 7%.
Dr Doig has a history in his report of the claimant experiencing no symptoms due to her pelvic fracture. The claimant said she has pain in her pelvic region particularly if she stands or walks for any length of time. Dr Doig noted a full range of motion in the left hip and therefore no impairment due to loss of motion however he has not mentioned any of the other methods of impairment assessment in the lower limb in particular whether there was an appropriate Diagnostic Related Estimates.
At the first teleconference I expressed concerned that Dr Doig has not considered the claimant’s left shoulder impairment. I also indicated I would be assisted by clarification from Dr Doig of whether any of the other methods of impairment assessment would lead to a WPI figure for the pelvic fracture. I deferred my consideration of the settlement and requested the insurer obtain a further short report from Dr Doig.
Dr Doig’s second report included reference to additional documentation about the claimant’s injuries. I note her undisplaced pelvic fracture attracts a 0% WPI rating under Table 64 of the AMA 4 Guides. The claimant did not limp and her range of motion in the hips was normal.
Dr Doig provided figures for the claimant’s loss of left shoulder motion which suggested she had a 7% UEI according to figures 38, 41 and 44 of the AMA 4 Guides which translates to a 4% WPI.
Dr Doig found no sensory or motor deficit due to the “irritable ulnar nerve”.
At both teleconferences I told the claimant that I was not a medical assessor and if she wished to pursue a claim for non-economic loss or explore her entitlement to that head of damage, she could do so by lodging an application for medical assessment. Ms Everett said she did not wish to pursue that course of action but wanted to finalise her claim.
The requirements of the legislation
When considering the provisions of s 6.23 of the MAI Act and cl 7.37 of the Guidelines along with the rules and practice directions of the Commission in determining whether to approve Ms Everett’s settlement I must consider:
(a) appropriateness – whether the amount of the settlement is just, fair and reasonable, and
(b) understanding – whether Ms Everett understands the settlement and its terms and the effect of the settlement in ending her claim for damages.
I am satisfied that Ms Everett understands that she is entitled to reasonable and necessary, accident-related treatment and care for the remainder of her life. The settlement of this damages claim does not affect that claim and Ms Everett can continue to ask and receive assistance and treatment from NRMA.
Ms Everett accepts that the settlement of her damages claim is binding upon her and that she cannot make a further claim for damages in the future. She understands while she will receive treatment and care if she asks for it, the settlement of this claim will end the insurer’s liability to pay her weekly benefits for any loss of earnings.
Ms Everett confirmed that she did not wish to engage the services of a lawyer in relation to this settlement.
I am satisfied that the allowance for past loss of earnings is appropriate. The calculation is correct, the weekly figure and superannuation allowance is correct and there is a very small adjustment or rounding.
Ms Everett is soon to turn 67 and NRMA has allowed her damages for her lost earning capacity for a further two years. In the light of the uncertainty as to the claimant’s plans for working or retirement, this figure is, in my view, within the range of damages the claimant could achieve at an assessment.
I am therefore satisfied that the total amount of damages offered to Ms Everett by NRMA is appropriate and within the range of damages I would assess.
CONCLUSION
I am therefore satisfied that the proposed settlement figure of $142,760.90 is an appropriate one and that it complies with the requirements of cl7.37 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 the Commission, 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.”
Accordingly, pursuant to s 6.23 of the MAI Actthe proposed settlement of Ms Anne Everett’s claim for damages is approved.
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