Insurance Australia Limited t/as NRMA Insurance v Morris
[2022] NSWPIC 113
•21 March 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | Insurance Australia Limited t/as NRMA Insurance v Morris [2022] NSWPIC 113 |
| CLAIMANT: | Berenice Morris |
| INSURER: | Insurance Australia Limited t/as NRMA Insurance |
| MEMBER: | Anthony Scarcella |
| DATE OF DECISION: | 21 March 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Approval of settlement; section 6.23 of the Motor Accident Injuries Act 2017 (MAI Act); high impact motor accident; claimant sustained a soft tissue injury to the cervical spine, a fracture of the left L4 transverse process in the lumbosacral spine, a fractured right scaphoid, a fractured right ankle involving the lateral malleolus and right 3rd through to 11th rib fractures; claimant aged 65 years at the time of the motor accident and was in part-time employment; ongoing symptoms in the region of the cervical spine, lumbosacral spine, right scaphoid and right ankle; whole person impairment agreed at 15% in respect of physical injuries; Reece v Reece and RACQ Insurance Limited v Motor Accidents Authority of NSW(No 2) considered and applied; Held- the proposed settlement of $273,000 is just, fair and reasonable and within the range of likely potential damages assessments 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, the disabilities, the impairments and the losses sustained by the claimant, and taking into account the proposed reductions or deductions in the proposed settlement; the proposed settlement is approved under section 6.23(2)(b) of the MAI Act. |
| DETERMINATIONS MADE: | 1. The proposed settlement is approved. 2. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. |
Issued under section 6.23 of the Motor Accident Injuries Act 2017
STATEMENT OF REASONS
BACKGROUND
The claimant, Mrs Berenice Morris, is a 67-year-old woman, who was involved in a motor accident in Parramatta, where she was a front seat passenger in a motor vehicle driven by her late husband on 13 February 2020 (the motor accident). The motor accident occurred when Mrs Morris’ husband suffered a medical incident causing the vehicle he was driving to mount the kerb, collide with a low timber post and rail, continue onto the grass and collide with two trees causing major front end damage before coming to a stop.[1]
[1] Application for damages settlement approval at A6 – Police traffic accident report.
Mrs Morris made a claim for and received statutory benefits in respect of the motor accident against Insurance Australia Limited t/as NRMA Insurance (NRMA), being the relevant compulsory third-party insurer of the vehicle at fault.
Mrs Morris lodged an application for damages under common law with NRMA.
On 26 October 2021, NRMA wholly admitted liability in respect of the claim for damages under common law and conceded that Mrs Morris’ physical injuries exceeded the threshold imposed by section 4.11 of the Motor Accidents Injuries Act 2017 (the MAI Act).[2]
[2] Application for damages settlement approval at A5.
On 30 December 2021, NRMA proposed an offer of settlement to Mrs Morris in the sum of $273,000 for non-economic loss, past economic loss and future economic loss damages.[3]
[3] Application for damages settlement approval at A1.
On 11 January 2022, Mrs Morris accepted NRMA’s proposed offer of settlement.[4]
[4] Application for damages settlement approval at A1.
Mrs Morris is not represented by an Australian legal practitioner. As Mrs Morris is not legally represented, the proposed offer of settlement requires the approval of the Personal Injury Commission (the Commission).
On 14 January 2022, NRMA lodged an application for damages settlement approval with the Motor Accidents Division of the Commission in respect of the proposed settlement amount.
In the reply to the NRMA’s application, Mrs Morris also sought approval of the proposed settlement.
On 21 February 2022, I presided over a teleconference arranged in this matter by the Commission. Ms Vicki Zogopoulos appeared on behalf of NRMA and Mrs Morris represented herself. I had the opportunity to question Mrs Morris. I offered Ms Zogopoulos the opportunity to expand on the written submissions prepared by her colleague, Ms Belinda Dockray, who did not participate in the teleconference. Ms Zogopoulos had nothing to add to her colleague’s written submissions.
DOCUMENTS CONSIDERED
The following documents were before the Commission and considered in making this determination:
(a) NRMA’s application for damages settlement approval dated 14 January 2022 and attached documents A1 to A7 inclusive and AD1, and
(b) Mrs Morris’ undated reply.
CONSIDERATION AND REASONS
The legislation and legal principles
The Commission 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.
As a member of the Motor Accidents Division of the Commission, 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) of the Personal Injury Commission Regulation 2020 provides that the Motor Accident Injuries Act 2017 (the MAI Act) and the Motor Accident Guidelines (the Guidelines) continue to apply.
In making my decision I have considered the following legislation and guidelines:
(a) the Personal Injury Commission Act 2020;
(b) the Personal Injury Commission Regulation 2020;
(c) the MAI Act, and
(d) the Guidelines.
Section 6.23 of the MAI Act states:
“6.23 Restrictions on settlement of claim for damages
(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) A claim for damages cannot be settled unless –
(a)the claimant is represented in respect of the claim 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.”
Clause 7.37 of the Guidelines states:
“Under section 6.23(3) of the Act, before the Personal Injury Commission may approve the settlement of a claim for damages, it must be satisfied that:
(a)the proposed settlement satisfies the timing requirements in section 6.23(1) of the 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 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
(d)the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.”
The evidence
Mrs Morris was 65 years of age at the time of the motor accident. She is now aged 67 years.
Mrs Morris’ pre-motor accident medical history included a hysterectomy, radical left oophorectomy and removal of 33 lymph nodes for cervical cancer (1988); right breast cancer, resulting in lumpectomy, chemotherapy and radiotherapy (1997); hypertension (2004); hypothyroidism (2006); impaired glucose tolerance (2009); sleep apnoea (2010); lumbar spondylosis (2010); tremor (2010); right eye uveitis (2015); benign positional vertigo (2017); foot pain (2018); urinary incontinence (2019); tubular adenoma of the colon (2019); gastroscopy and small hiatus hernia (2019); glaucoma; vitamin D deficiency; gastro-oesophageal reflux; and a development of the further lump in the breast area since the motor accident.[5]
[5] Application for damages settlement approval at A3 at page 4.
The motor accident occurred when Mrs Morris’ husband suffered a heart attack causing him to lose control of the vehicle he was driving. The vehicle mounted the kerb, collided with a low timber post and rail, continued onto the grass and collided with two trees before coming to a halt. Mrs Morris was a front seat passenger in the vehicle driven by her husband and was wearing her seatbelt. At the time of impact, the airbags in the vehicle deployed. She did not lose consciousness and was able to extract herself from the vehicle. Sadly, Mr Morris died.
Police and ambulance paramedics attended the scene of the motor accident. Mrs Morris was conveyed by ambulance to Westmead Hospital, where she was admitted and eventually discharged on 21 February to Minchinbury Community Hospital for rehabilitation. Mrs Morris was discharged from Minchinbury Community Hospital on 5 March 2020.
The Westmead Hospital discharge summary reported that medical imaging showed a left anterior abdominal wall haematoma; fractures of the 3rd to 11th right ribs; fracture of the L4 right transverse process; fracture of the lateral malleolus of the right ankle; and a superficial laceration to the base of the left thumb that required suturing.[6]
[6] Application for damages settlement approval at AD1.
Mrs Morris came under the care of Dr Todd Gothelf, orthopaedic surgeon, specialising in foot, ankle and shoulder surgery, in respect of her right ankle injury. She first consulted Dr Gothelf in March 2020 and he recommended that she attend a structured weight bearing lower limb conditioning regime and wear a CAM boot until September/October 2020 at which time, further scans were to be undertaken. An MRI scan report dated 6 October 2020 demonstrated evidence of a healing but non-united Weber A fracture. There was also mild to moderate tenosynovitis of the peroneal brevis and longus tendons; mild to moderate grade sprains of the lateral collateral ligamentous complex and the medial collateral ligament.
In about mid-October 2020, Dr Gothelf administered a cortisone injection into Mrs Morris’ right ankle, which made her pain worse.
On 8 December 2020, Mrs Morris underwent a right ankle arthroscopy and debridement of the medial talar dome lesion by Dr Gothelf. On 23 March 2021, Dr Gothelf reported to Dr Michelle Crockett, Mrs Morris’ general practitioner,[7] that post-operative wounds had healed well; ankle dorsi flexion was limited to neutral only; and the ankle was relatively non-tender. Mrs Morris underwent physiotherapy and was then referred for exercise physiology. Dr Gothelf opined that Mrs Morris was doing well with improved dorsi flexion. He was pleased with her results and advised that she could resume her activities and follow-up with him, if needed.
[7] Application for damages settlement approval at AD1.
Mrs Morris came under the care of Dr Michael Dowd, plastic, reconstructive and hand surgeon, on the referral of Dr Crockett after scans demonstrated a fracture of the right scaphoid. The right wrist was placed in a plaster cast. On review on 21 July 2020, Dr Dowd observed that the right scaphoid fracture had not yet fully healed. He recommended the use of a LIPUS ultrasound machine to accelerate the healing process.[8]
[8] Application for damages settlement approval at AD1.
On 25 August 2020, Dr Dowd reported to Dr Crockett that Mrs Morris was progressing very well. He noted that the pain had improved with the use of the LIPUS ultrasound machine, not only at rest but also with activities of daily living. He also noted that Mrs Morris was still quite stiff, particularly in flexion of the wrist. He recommended that she continue the use of the LIPUS ultrasound machine and return for review in six weeks with a new CT scan.
On 6 October 2020, Dr Dowd reported to Dr Crockett that Mrs Morris’ pain and tenderness had improved and that the new CT scan demonstrated incomplete union but that there was ongoing bony healing. He recommended that Mrs Morris continue the use of the LIPUS ultrasound machine and return for review in six weeks with a new CT scan. There were no further reports from Dr Dowd in evidence.
On 9 September 2021, Mrs Morris consulted Dr Robin Mitchell, occupational physician, at the request of NRMA. In evidence, there is a report by Dr Mitchell dated 20 September 2021.[9] I will now refer to the relevant parts of that report.
[9] Application for damages settlement approval at A3.
Dr Mitchell took a history of the motor accident and post-accident medical treatment that was consistent with the evidence. In addition, Mrs Morris reported to Dr Mitchell that, following the motor accident, she suffered depression and was referred for counselling. In June 2020, she consulted a psychologist but did not continue with treatment, preferring to recover from her husband’s passing without seeking help. She re-engaged with a psychologist in July 2021. Dr Mitchell noted that Mrs Morris reported pain in the left knee that she believed had been caused by compensating for her right ankle.
Dr Mitchell reported that, at the time of the motor accident, Mrs Morris was employed as a part-time bookkeeper for two motor vehicle mechanics, working a total of 25 hours per week. Following the motor accident, she was able to return to work in both jobs, working 20 hours per week from March 2020 until 7 December 2020. She was unfit for work from 8 December 2020 until 26 February 2021, whilst recovering from the right ankle surgery performed by Dr Gothelf. Thereafter, she returned to her pre-motor accident duties at 25 hours per week.
Dr Mitchell reported that Mrs Morris complained of continuing pain in her neck and left lower back; a painful right wrist at times that “feels crunchy”[10] with movement; pain and reduced movement of the right ankle with a burning feeling on occasions together with swelling; and bilateral leg and knee joint pain. Dr Mitchell was informed that an MRI scan indicated that she had suffered a tear of the left meniscal cartilage for which she may undergo arthroscopic surgery at some time in the future.
[10] Application for damages settlement approval at A3 at page 5.
Dr Mitchell opined that Mrs Morris is fully independent with respect to her personal activities of daily living. She carries out lighter physical activities in the home. He opined that she would have difficulty with low-level cleaning, mopping and vacuuming.
Dr Mitchell conducted a physical examination via telehealth assessment. He reported that Mrs Morris’ responses during physical examination were consistent and appropriate.
Dr Mitchell thoroughly reviewed the medical imaging reports made available to him.
Dr Mitchell opined that, as a result of the motor accident, Mrs Morris sustained the following injuries:
(a) a soft tissue injury to the cervical spine;
(b) a fracture of the left L4 transverse process in the lumbosacral spine, from which she has made a good recovery;
(c) a fractured right scaphoid with ongoing pain and reduced movement, from which she has made a reasonable recovery;
(d) a fractured right ankle involving the lateral malleolus with ongoing pain and a mild degree of reduced movement in the ankle, from which she has made a reasonable recovery, and
(e) right 3rd through to 11th rib fractures, from which she has made a good recovery.
In respect of Mrs Morris’ prognosis, Dr Mitchell opined ongoing discomfort or pain and reduced movement in the right wrist and right ankle due to the nature of the injuries sustained. He opined that Mrs Morris should be able to remain relatively comfortable with respect to her neck and lower back provided she avoided any further aggravation.
In respect of Mrs Morris’ work capacity, Dr Mitchell opined that she had a current capacity for suitable work that avoided any aggravation of her reported symptoms and underlying conditions and providing the following precautions were available, she should be able to manage such work on a full-time basis:
(a) only undertake administrative work where she can avoid fixed and awkward spinal postures, change postures, move on a regular basis throughout the day and avoid any arduous right hand gripping actions;
(b) frequent manual handling actions should be limited to 5kg in force with respect to lifting, carrying, pushing and pulling actions;
(c) prolonged walking, particularly over uneven or sloping ground surfaces should be avoided, and
(d) frequent step climbing, kneeling and crouching actions should be avoided.
Dr Mitchell noted that Mrs Morris had been able to manage her pre-injury hours in administrative work and he opined that she should be able to continue to do so for the foreseeable future. Dr Mitchell also opined that Mrs Morris’ future capacity would not improve in the foreseeable future.
Dr Mitchell opined that Mrs Morris had reached maximum medical improvement and assessed her motor accident related whole person impairment in respect of her cervical spine, lumbar spine, right wrist and left ankle at 15%.
In evidence, there is a report by Mr James Gleeson, occupational therapist, dated 29 November 2021.[11] I will now refer to the relevant parts of that report.
[11] Application for damages settlement approval at A2.
Mr Gleeson reported that, on 20 March 2020, Mrs Morris attended a consultation with Dr Crockett, who was receptive to her motivation to commence a return to work. Mrs Morris’ pre-accident employment was as a bookkeeper for two mechanical workshops. She was assessed as having a work capacity of three hours per day, two days per week commencing on 20 March 2020.
Mr Gleeson reported that, on 9 April 2020, Dr Crockett increased Mrs Morris’ work capacity to four hours per day, three days per week. Secondary to the impacts of COVID-19 in mid-2020, Mrs Morris discontinued work with one of her employers and received a COVID-19 Job Keeper payment. She continued to work for the other employer in keeping with her medical restrictions and capacity.
Mr Gleeson reported that, in late June 2020, Dr Crockett increased Mrs Morris’ capacity for work to four hours per day, four days per week. In late July 2020, Dr Crockett increased Mrs Morris’ capacity for work to five hours per day, four days per week. Apart from a period of being unfit for work following surgery on 8 December 2021 until early January 2021, Mrs Morris maintained regular reviews with Dr Crockett and in early January 2021, she returned to work for 20 hours per week. Mrs Morris’ work capacity was increased to her pre-injury hours of 25 hours per week from 13 August 2021.
Mr Gleeson opined that since 13 August 2021, Mrs Morris had sustained her pre-injury level of function and capacity for work without issue. He assessed Mrs Morris as independent and safe for all activities of daily living including, personal care, domestic activities and community access. He noted that she was no longer engaged in any active treatment. He noted that she endures ongoing right ankle and right wrist pain and swelling, which she is self-managing within her life routines.
At the teleconference on 21 February 2022, Mrs Morris informed me that she did not wish to obtain independent legal advice. She advised that she understood the binding nature and effect of the proposed settlement and that she will be precluded from making a further claim for damages arising out of the motor accident but is entitled to ongoing treatment and care needs for life. Mrs Morris informed me that she was currently working about 16 hours, sometimes 20 hours, per week with her employers because there was less work. She advised that she was happy with the proposed settlement and wanted to move on and put the motor accident and the claim behind her. Mrs Morris requested the Commission to approve the proposed settlement.
The proposed settlement agreement
The total of the proposed settlement is $273,000 made up as follows:
(a) non-economic loss: $250,000;
(b) past economic loss: $13,000, and
(c) future economic loss: $10,000.
In respect of non-economic loss damages, NRMA submitted that Mrs Morris’ age and comorbidities ought to be considered in addition to the usual considerations. NRMA submitted that $250,000 for non-economic loss damages was reasonable.
In respect of damages for past economic loss, NRMA submitted that, at the time of the motor accident, Mrs Morris was working as a part-time payroll officer for two car yards, namely, Mountain Autos Pty Limited and Penrith Autos Pty Limited, for a total of 25 hours per week. She underwent a gradual return to work whilst receiving weekly benefits from NRMA and returned to her pre-injury duties on 13 August 2021. Mrs Morris has reached retirement age and is entitled to the Aged Pension. However, Mrs Morris advised NRMA that she wished to continue working until she is able to do so, noting that her husband worked until he was aged 70 and she planned to do the same.
NRMA submitted that, at the time of the motor accident, Mrs Morris was working for Mountain Autos Pty Limited for 15 hours per week for $570 gross per week plus superannuation of $54.15. She was working with Penrith Autos Pty Limited for 10 hours per week for $550 gross per week plus superannuation of $55.22. In early July 2020, she received a pay rise to $650 per week with the latter employer. NRMA calculated Mrs Morris’ income from the time of the motor accident to the time she returned to work at $95,397.75 inclusive of superannuation. Mrs Morris did not disagree with this calculation. NRMA paid the sum of $22,728.20 inclusive of Fox v Wood damages, leaving a balance of $72,669.55, less Mrs Morris’ earnings of $60,010, resulting in a shortfall of $12,659.55, which NRMA has rounded up to $13,000.
In respect of future economic loss, NRMA submitted that Mrs Morris was already at retirement age but was still wanting to work until about age 70. She is currently coping with her pre-injury hours and duties. Accordingly, NRMA has allowed a buffer of $10,000 based on Mrs Morris’ age, ongoing symptoms and pre-existing continuing medical comorbidities that could come into play in the future in respect of her work capacity.
NRMA advised that the proposed settlement of $273,000 is not subject to any deductions, that is, the net payment to Mrs Morris, if the settlement is approved, will be $273,000.
During the teleconference on 24 January 2022, Mrs Morris acknowledged the matters referred to in [47] and [52] above.
Section 1.4 of the MAI Act defines non-economic loss as pain and suffering, loss of amenities of life, loss of expectation of life and disfigurement.
In accordance with sections 4.13 and 4.22 of the MAI Act, non-economic loss damages are capped and indexed annually. The current maximum amount for non-economic loss damages is capped at $595,000. Non-economic loss damages are to be assessed in accordance with common law principles, subject to the cap referred to above.
NRMA submitted that Mrs Morris’ age at the time of an assessment of damages is a matter a Member of the Commission ought to consider when determining the appropriate amount of non-economic loss damages: Reece v Reece.[12] However, a claimant’s age is only one of many relevant factors in determining the quantum of non-economic loss.
[12] Reece v Reece [1994] NSWCA 259.
I have taken Mrs Morris’ age into consideration. Mrs Morris is currently 67 years of age and on the Medium Life Expectancies, Australia, 2020 table prepared by Cumpston Sarjeant Pty Limited and based on the projections published by the Australian Bureau of Statistics, she has a life expectancy of 21 years to live with the physical impacts of the motor accident.
I have taken into consideration the nature and extent of Mrs Morris’ physical injuries as a result of the motor accident. The physical injuries sustained have had a significant impact on her life in general.
The quantum of damages for non-economic loss must be fair and reasonable compensation for the injuries received and disabilities caused and must be proportionate to the situation of the claimant: RACQ Insurance Limited v Motor Accidents Authority of NSW(No 2).[13]
[13] RACQ Insurance Limited v Motor Accidents Authority of NSW(No 2) [2014] NSW SC 1126.
I am satisfied that the sum of $250,000 is within the range of damages likely to be awarded for non-economic loss if this matter had progressed to an assessment hearing before a Member of the Commission.
I am also satisfied that the allowance for past economic loss ($13,000) and the buffer for future economic loss ($10,000) are amounts within the range of damages likely to be awarded if this matter had progressed to an assessment hearing before a Member of the Commission.
Conclusion
I find that the requirements of s 6.23(1) of the MAI Act have been satisfied, in that, Mrs Morris’ degree of permanent impairment as a result of the injuries caused by the motor accident has been agreed to be greater than 10%.
I am satisfied that 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 the Commission, taking into account the nature and extent of the claim and the injuries, the disabilities, the impairments and the losses sustained by Mrs Morris, and taking into account there are no deductions to be made from the proposed settlement.
I am satisfied that Mrs Morris understands that she is entitled to be represented in respect of the claim by an Australian legal practitioner but does not wish to do so.
I am satisfied that Mrs Morris understands the binding nature and effect of the proposed settlement and that she will be precluded from making a further claim for damages arising out of the motor accident but is entitled to ongoing treatment and care needs for life. Whilst NRMA 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 am satisfied that Mrs Morris is willing to accept the proposed settlement.
Accordingly, under s 6.23(2)(b) of the MAI Act, I approve the settlement of Mrs Morris’ claim for damages in the total sum of $273,000.
Anthony Scarcella
Member (Motor Accidents Division)
Personal Injury Commission
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