Leydon v Insurance Australia Limited t/as NRMA Insurance
[2023] NSWPICMR 7
•7 February 2023
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| Citation: | Leydon v Insurance Australia Limited t/as NRMA Insurance [2023] NSWPICMR 7 |
| ClaimanT: | Jonathon Leydon |
| Insurer: | Insurance Australia Limited t/as NRMA Insurance |
| Merit Reviewer: | Brett Williams |
| DATE OF DECISION: | 7 February 2023 |
CATCHWORDS: | MOTOR ACCIDENTS- Motor Accident Injuries Act 2017; merit review; whether the insurer was entitled to suspend payment of weekly benefits under section 3.15(7); where certificate of fitness relied on by claimant related to a period that was more than 90 days before the certificate was provided by the claimant to the insurer contrary to section 3.15(5); Held – while section 3.15(5) resulted in the certificate of fitness being of no effect, having failed to issue a suspension notice as required by clause 4.58 of the Motor Accident Guidelines, the insurer was not entitled to suspend the claimant’s weekly payments under section 3.15(7); reviewable decision set aside; matter remitted to the insurer. |
| Determinations made: | CERTIFICATE OF DETERMINATION 1. NRMA’s decision of 18 October 2022 is set aside. 2. The matter is remitted to NRMA to determine Mr Leydon’s entitlements under Division 3.3 of the Motor Accident Injuries Act 2017. |
STATEMENT OF REASONS
background
Jonathon Leydon was injured in a motor accident on the M5, Bexley, on 6 January 2022 (the accident). Following the accident, Mr Leydon made an application for personal injury benefits (statutory benefits) under the Motor Accident Injuries Act 2017 (MAI Act) on Insurance Australia Limited t/as NRMA Insurance (NRMA).
NRMA accepted liability for the statutory benefits claim for the first 26 weeks after the accident. Liability to pay statutory benefits after 26 weeks from the accident was denied on 28 April 2022, NRMA having determined that Mr Leydon’s only injuries resulting from the accident were minor injuries.
A dispute has arisen between Mr Leydon and NRMA about NRMA’s decision on 18 October 2022 not to pay him weekly benefits on the basis that he had failed to comply with s 3.15 of the MAI Act (the dispute).
An internal review of the insurer’s decision was sought by Mr Leydon. The insurer’s decision was affirmed by an internal reviewer on 7 November 2022.
Mr Leydon commenced these proceedings on 23 December 2022. The dispute is a merit review matter that falls within the terms of Sch 2 cl 1(d) of the MAI Act. I am determining the dispute in my capacity as a merit reviewer.
evidence
I have considered the evidence lodged with the Commission by the parties in the proceedings. A summary of evidence follows.
By letter to Mr Leydon dated 9 February 2022 NRMA confirmed that he was entitled to receive weekly income loss payments for the periods he was unable to work due to his injuries. Among other things, the letter states:
“Your entitlement to weekly income loss payments also depends on your doctor confirming your incapacity for work, so it’s important to continue providing certificates of fitness from your doctor, as well as continuing with your treatment and rehabilitation.”
By letter dated 10 February 2022, NRMA informed Mr Leydon that it accepted liability to pay statutory benefits for “up to 26 weeks” from the date of the accident. The letter states that, with respect to weekly benefits, “[NRMA] can only make income loss payments to you if we’ve received a certificate for fitness from your doctor to support your incapacity for work”.
The evidence includes certificates of fitness from Dr Gunawardena dated 2 February 2022 and 9 March 2022. The 2 February 2022 certificate covered the period 2 February 2022 to 2 March 2022. The 9 March 2022 certificate covered the period 2 March 2022 to 30 March 2022. NRMA paid Mr Leydon weekly payments of statutory benefits for the period 6 January 2022 to 30 March 2022.
The evidence includes a letter from Dr Gunawardena to NRMA dated 9 March 2022, in which the doctor states that Mr Leydon was unfit for any work from 6 January 2022 to 2 February 2022.
In an email dated 21 March 2022, NRMA advised Mr Leydon that his certificate of fitness for work would expire on 30 March 2022. The email states that he “will need to provide a valid up-to date certificate to assist [NRMA]…with coordinating [his] … ongoing income support payments…”.
The email also states that:
“You will need to continue to obtain valid certificates at least once every 28 days, or when your circumstances have changed. If you require a certificate covering a longer period, please contact me as soon as possible.”
Under the heading “What happens if I don’t have a valid certificate?” the email states:
“Your weekly benefits may be suspended if a valid Certificate of Fitness has not been received after your certificate expires. You can see Section 3.15(6) of the Motor Accident Injuries Act for more information.”
Attached to the email is a blank certificate of fitness.
On 28 April 2022 NRMA provided Mr Leydon a liability notice for benefits after 26 weeks. The notice states that NRMA had determined that his claim for statutory benefits after 26 weeks had been declined on the basis that he had “been assessed as having a minor injury”. The notice also records that Mr Leydon was not considered to be at fault for the accident.
By email dated 13 October 2022, Mr Leydon provided NRMA with a certificate of fitness from Dr Gunawardena dated 12 October 2022. The certificate covers the period 30 March 2022 to 30 June 2022, and records that Mr Leydon had capacity for some type of work for full hours during that period.
In an email dated 18 October 2022 NRMA informed Mr Leydon that it was “unable to accept the certificate” from Dr Gunawardena dated 12 October 2022. The email sets out s 3.15(5), notes that the certificate was signed on 12 October 2022, and states that NRMA was “unable to process [w]eekly [b]enefit[s]” after 30 March 2022.
NRMA’s decision, contained in its email to Mr Leydon dated 18 October 2022, is the reviewable decision for the purposes of these proceedings. As I discuss later in these reasons, the effect of the reviewable decision was to suspend payment of weekly payments of statutory benefits to Mr Leydon.
Mr Leydon sought an internal review of the reviewable decision. On 7 November 2022 an internal reviewer affirmed the insurer’s decision. The internal reviewer determined that Mr Leydon had not provided a certificate of fitness in accordance with s 3.15 of the MAI Act and that, accordingly, he was not entitled to payments of weekly benefits from 30 March 2022 to 6 July 2022 (the end of the period 26 weeks after the accident).
STATUTORY PROVISIONS
The provision in the MAI Act central to this dispute is s 3.15, which states as follows:
“3.15 Requirements for evidence as to fitness for work
(1) An injured person must provide to the insurer—
(a) certificates of fitness for work in accordance with this section in respect of the period in respect of which the person is entitled to weekly payments of statutory benefits under this Division, and
(b) a declaration in accordance with the Motor Accident Guidelines as to whether or not the person is engaged in any form of employment or voluntary work for which he or she receives or is entitled to receive payment in money or otherwise or has been so engaged at any time since last providing a certificate under this section.
(2) If a decision to reject a claim for weekly payments of statutory benefits or to cease weekly payments of statutory benefits is set aside, a person is not required to comply with this section in respect of any period from the date that the decision took effect until the day on which the decision is set aside.
(3) A certificate of fitness for work must—
(a) for a first certificate provided by the injured person to the insurer—be a certificate given by a treating medical practitioner in accordance with the Motor Accident Guidelines, and
(a1) for a second or subsequent certificate provided by the injured person to the insurer—be a certificate that complies with the requirements specified in the Motor Accident Guidelines, including the form of the certificate, and
(b) certify as to the person’s fitness for work and whether the person has current fitness for work or has no current fitness for work during the period, not exceeding 28 days, stated in the certificate, and
(c) specify the expected duration of the person’s unfitness for work.
(3A) To avoid doubt, certificates referred to in subsection (3)(a) and (a1) constitute medical certificates as to an injured person’s fitness for work for the purposes of this Act.
(4) A certificate of fitness for work may cover a period exceeding 28 days if—
(a) the person giving the certificate states in the certificate the special reasons why the certificate covers the longer period, and
(b) the insurer is satisfied that, for the special reasons stated, the certificate should be accepted.
(5) A certificate of fitness for work is of no effect to the extent that it relates to a period that is more than 90 days before the certificate is provided by the injured person to the insurer.
(6) An insurer is not required to make weekly payments of statutory benefits to which a person is entitled to under this Division until the person has complied with subsection (1).
(7) If a person fails to comply with a requirement under this section within 7 days, or another period prescribed by the regulations, after the requirement is communicated to the person by the insurer, the insurer may, subject to the Motor Accident Guidelines, suspend payment of weekly payments of statutory benefits to the person under this Division for the period the failure to comply continues.
(8) The person forfeits the person’s entitlement to weekly payments of statutory benefits during the period of a suspension.”
When NRMA made the reviewable decision on 18 October 2022, version 8.2 of the Guidelines (Guidelines) was in force. The Guidelines address non-compliance with providing evidence of fitness for work in clauses 4.57 – 4.59. Those clauses are in the following terms:
“Non-compliance with providing evidence of fitness for work
4.57 Before an insurer can suspend weekly payments for failure of the claimant to comply with requirements for evidence as to fitness for work, the insurer must:
(a) contact the claimant (via the claimant’s preferred method of communication) to ensure that the claimant is aware of their duty to provide this evidence
(b) clearly state to the claimant the consequences of not providing the evidence
(c) provide the claimant with a reasonable time within which to comply
(d) if the claimant is a participant in the Lifetime Care & Support Scheme, the insurer must contact the Lifetime Care & Support Authority of NSW before any potential adverse decision is made
(e) provide the claimant with contact details of the Authority.
4.58 If the claimant continues to fail to comply without a reasonable excuse, a suspension notice giving the claimant seven calendar days to comply must be sent in writing.
4.59 The suspension notice must clearly state the insurer’s reasons for suspending weekly payments, actions the claimant must take to avoid suspension of their weekly payments and the claimant’s rights of review. A copy of this notice must be provided to the claimant’s legal representative where the claimant is legally represented.”
preliminary conference
A preliminary conference was held on 1 February 2022. Mr Leydon attended as did Ms Crnobrnja, on behalf of NRMA. I explained my role as a merit reviewer and confirmed the nature of the dispute.
Mr Leydon confirmed that he had been paid weekly payments of statutory benefits for the period 6 January 2022 to 30 March 2022.
I explained to Mr Leydon that his entitlements to statutory benefits under the MAI Act were governed by the provisions of that Act. I confirmed that NRMA’s position was that, as a consequence of s 3.15(5), the certificate of fitness from Dr Gunawardena dated 12 October 2022 did not comply with s 3.15(5) and was of no effect. As the certificate of fitness was of not effect, NRMA’s position was that Mr Leydon was not entitled to weekly benefits from 30 March 2022 to 30 June 2022.
Mr Leydon told me that he had been unable to obtain a certificate of fitness earlier than 12 October 2022 due to health issues and the distance between his home and Dr Gunawardena’s practice.
Mr Leydon and Ms Crnobrnja agreed that the dispute can be determined on the papers.
on the papers
The parties agreed to the proceedings being determined on the papers. Having considered both s 52 of the Personal Injury Commission Act2020 (PIC Act) and Procedural Direction PIC2 I have concluded that the matter can be determined on the papers. I am satisfied that sufficient information is available to allow me to determine the dispute without holding a formal hearing.
determination
The decision under review in these proceedings is NRMA’s decision of 18 October 2022. By that decision, NRMA determined that it was “unable to accept the certificate” of fitness from Dr Gunawardena dated 12 October 2022 and that it was “unable to process [w]eekly [b]enefit[s]” after 30 March 2022. It was this decision that was the subject of the internal review decision dated 7 November 2022.
I am satisfied that NRMA considered that it had suspended payment of weekly payments to Mr Leydon after 30 March 2022. In this regard, correspondence from the internal reviewer to Mr Leydon dated 24 October 2022 states that the internal reviewer would review NRMA’s decision “…in relation to the suspension of [his] weekly payments of statutory benefits”.
Further, by letter dated 7 November 2022, the internal reviewer informed Mr Leydon that they had “completed a review of the decision dated 18 October 2022…in relation to the suspension of [his] weekly payments of statutory benefits”. The internal reviewer’s reasons include a number of findings under the heading “Suspension of Weekly Benefits”.
Although the manner by which NRMA characterised its decision of 18 October 2022 is not determinative, I find that the practical effect of this decision was to suspend weekly payments of statutory benefits under Division 3.3 to Mr Leydon after 30 March 2022 .
For the suspension to have been lawful, it needed to be effected by NRMA in accordance with s 3.15(7) of the MAI Act. In my view, s 3.15(7) required NRMA to communicate to Mr Leydon that he needed to provide it with a valid certificate of fitness, as required by s 3.15(1), if he wanted to be paid weekly payments of statutory benefits after 30 March 2022, when the certificate dated 9 March 2022 expired. I find that NRMA did communicate this requirement to Mr Leydon in its email dated 21 March 2022.
I find that Mr Leydon did not comply with the requirement, under s 3.15, to provide NRMA with a certificate of fitness for work, after his existing certificate of fitness expired on 30 March 2022, within seven days after the requirement to do so was communicated to him by NRMA on 21 March 2022.
Further, I find that the certificate of fitness from Dr Gunawardena dated 12 October 2022 was of no effect because:
(a) the certificate covered the period 30 March 2022 to 30 June 2022;
(b) the certificate was provided to NRMA on 13 October 2022, and
(c) the certificate related to a period that was more than 90 days before it was provided to NRMA.[1]
[1] Section 3.15(5) MAI Act.
This in turn means that Mr Leydon had not provided a certificate of fitness for work for any period after 30 March 2022, as he was required to do if he wished to be paid weekly payments of statutory benefits.
This, however, is not the end of the matter. Section 3.15(7) states that an insurer may suspend payment of weekly payments of statutory benefits subject to the Motor Accident Guidelines. Clauses 4.57 to 4.59 of the Guidelines are set out earlier in these reasons.
With respect to clause 4.57, I find that NRMA:
(a) contacted Mr Leydon by email on 21 March 2022 to ensure that he was aware of his duty to provide a valid certificate of capacity: cl 4.57(a)
(b) clearly stated to Mr Leydon in the email of 21 March 2022 that the consequence of not providing a valid certificate of fitness was that weekly benefits may be suspended: cl 4.57(b)
(c) provided Mr Leydon with a reasonable time within which to comply with the requirement that he provide it a certificate of fitness for work in accordance with s 3.15: cl 4.57(c). In this regard, I find that providing Mr Leydon with eight days notice of the need for him to provide a certificate of fitness was reasonable.
Clauses 4.57(d) and (e) of the Guidelines are not relevant to the dispute as Mr Leydon is not a participant in the Lifetime Care & Support Scheme.
I have determined, however, that NRMA did not satisfy clauses 4.58 and 4.59 of the Guidelines before it decided, on 18 October 2022, to suspend payment of weekly payments of statutory benefits to Mr Leydon after 30 March 2022.
Clause 4.58 of the Guidelines required NRMA to issue Mr Leydon with a suspension notice, in writing, giving him seven calendar days to comply with the requirement to provide it with a certificate of fitness.
Clause 4.59 of the Guidelines states that a suspension notice must clearly state the insurer’s reasons for suspending weekly payments, actions the claimant must take to avoid suspension of their weekly payments and the claimant’s rights of review.
In short, cl 4.58 of the Guidelines required NRMA to provide Mr Leydon with a valid suspension notice, after it had complied with cl 4.57 of the Guidelines, and after Mr Leydon had failed to comply with the requirement to provide a certificate of fitness that satisfied s 3.15.
While I have found that NRMA’s email of 21 March 2022 satisfied cl 4.57, I am not satisfied that NRMA issued Mr Leydon with a suspension notice before it purported to suspend weekly payments of statutory benefits on 18 October 2022, as it was required to do: cl 4.58 of the Guidelines.
I find that, having failed to issue a suspension notice as required by clause 4.58 of the Guidelines, NRMA was not entitled to suspend Mr Leydon’s weekly payments under s 3.15(7) of the MAI Act.
Given my findings, NRMA’s decision of 18 October 2022 is set aside.
The matter is remitted to NRMA to determine Mr Leydon’s entitlements under Division 3.3 of the MAI Act.
0
0