Liu v Allianz
[2022] NSWPICMR 14
•25 February 2022
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| CITATION: | Liu v Allianz [2022] NSWPICMR 14 |
| CLAIMANT: | Dongshuai Liu |
| INSURER: | Allianz |
| MERIT REVIEWER: | Katherine Ruschen |
| DATE OF DECISION: | 25 February 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Merit review; dispute about payment of weekly benefits under Division 3.3 of the Motor Accident Injuries Act 2017 (MAI Act); the meaning of earner schedule 1, clause 2; whether the claimant is an earner; burden of proof; whether sufficient evidence to establish earner; section 6.24 of the MAI Act duty to co-operate; failure to co-operate; Held– the reviewable decision is affirmed. |
| DETERMINATIONS MADE: | The reviewable decision is about the amount of weekly payments of statutory benefits that are payable under Division 3.3 of the Motor Accident Injuries Act 2017 (the MAI Act), and is therefore a merit review matter under Schedule 2(1)(a) of the MAI Act. 1. The reviewable decision is: (a) set aside; (b) the claimant is determined to be an earner within the meaning in schedule 1, clause 2 of the MAI Act; (c) the claimant’s pre-accident weekly earnings (PAWE) under schedule 1, clause 4(1) is $551.54; (d) for the purpose of assisting in calculation of the difference between the claimant’s PAWE and post-accident earning capacity under section 3.6 and/or 3.7 of the MAI Act the claimant is to provide to the insurer a complete copy of his bank account statements for the period 9 September 2021 to date within 7 days of the date of this decision; (e) should the claimant provide further evidence relevant to assessment of PAWE the insurer is to conduct a fresh internal review as to calculation of PAWE based on that further evidence together with the evidence available to date. |
Issued under section 7.13(4) of the Motor Accident Injuries Act2017
BACKGROUND
There is a dispute between Dongshuai Liu (the claimant) and the insurer about the amount of weekly payments of statutory benefits that are payable under Division 3.3 of the MAI Act, specifically whether the claimant is an earner and therefore entitled to weekly benefits.
The claimant was involved in a motor accident on 24 August 2021.
The claimant is legally represented.
The claimant lodged an application for statutory benefits.
On 29 September 2021 the insurer determined that the claimant was not an earner in accordance with clause 2 of schedule 1 of the MAI Act and therefore was not entitled to weekly benefits under section 3.6 of the MAI Act.
The claimant applied for an internal review of the 29 September 2021 decision that he was not an earner.
By internal review decision dated 2 November 2021 the insurer maintained their decision that the claimant was not an earner.
The claimant applied for a merit review of the internal review decision of 2 November 2021.
SUBMISSIONS
The claimant contends he was employed by YRAN Pty Limited (YRAN) as a gyprocker and has submitted the following documents in support of his merit review application:
(a) his application for statutory benefits which provides limited employment details;
(b) his bank statements for the period 2 July 2020 to 8 September 2021;
(c) a company extract for YRAN;
(d) a drivers’ licence for “Heng Wang”;
(e) bank statements for YRAN for the period 1 July 2020 to 30 December 2020 and 1 July 2021 to 30 December 2021, and
(f) a screenshot of transactions from 7 April 2021 to 1 May 2021 from a business bank account.
Despite being legally represented the claimant has not provided any detailed submissions. The claimant’s submissions are limited to a statement in his merit review application that he disagrees with the insurer’s decision that he is not an earner.
The insurer submits there is insufficient evidence upon which one could be satisfied the claimant is an earner in accordance with the MAI Act and/or that there is insufficient evidence of earnings in the relevant pre-accident period such that the claimant’s PAWE are nil.
REASONS
Legislation
The definition of earner under the MAI Act is set out in clause 2 of Schedule 1 as follows:
“Meaning of ‘earner’
A person who is injured as a result of a motor accident is an
‘earner’ if the person is at least 15 years of age and who--
(a) was employed or self-employed (whether or not full-time)--
(i) at any time during the 8 weeks immediately preceding the motor accident, or
(ii) during a period or periods equal to at least 13 weeks during the year immediately preceding the motor accident, or
(iii) during a period or periods equal to at least 26 weeks during the 2 years immediately preceding the motor accident,
and, at the date of the motor accident, had not retired permanently from all employment, or
(b) before the motor accident, had entered into an arrangement (whether or not an enforceable contract)--
(i) with an employer or other person to undertake employment, or
(ii) to commence business as a self-employed person,
at a particular time and place, or
(c) was, immediately before the motor accident, receiving a weekly payment or other payment in respect of loss of earnings under this Act or the Workers Compensation Act 1987.”
The issues for consideration are:
(a) whether there is sufficient evidence to establish the claimant is an earner within the meaning in clause 2, Schedule 1, and
(b) if so, calculation of the claimant’s PAWE.
The onus is on the claimant to provide sufficient evidence to establish he is an earner and to establish PAWE.
Pursuant to section 6.24 of the MAI Act the claimant has a duty to fully co-operate with the insurer. Section 6.24 relevantly provides:
“Duty of claimant to co-operate with other party
(1) A claimant must co-operate fully in respect of the claim with the other party to the claim (being the insurer on the claim or, if there is no insurer, the person against whom the claim is made) for the purpose of giving the other party sufficient information--
(a) to be satisfied as to the validity of the claim and, in particular, to assess whether the claim or any part of the claim, may be fraudulent, and
(b) to be able to make an early assessment of liability, and
(c) to be able to make an informed offer of settlement in the case of a claim for damages.
(2) In particular, the claimant must comply with any reasonable request by the other party--
(a) to furnish specified information (in addition to the information furnished in the claim) or to produce specified documents or records, or
(b) to provide a photograph of and evidence as to the identity of the claimant.
(3) The reasonableness of a request may be assessed having regard to criteria including the following--
(a) the amount of time the claimant needs to comply with the request,
(b) whether the information sought is cogent and relevant to a determination of liability or quantum of loss, having regard to the nature of the claim,
(c) the amount of information which has already been supplied to or is available to an insurer to enable liability and quantum of loss to be assessed and an offer of settlement made,
(d) how onerous it will be for the claimant to comply with the request,
(e) whether the information is privileged,
(f) whether the information sought is sufficiently specified,
(g) the time of the request and whether the claimant will be delayed in commencing proceedings for damages by complying with the request.
(4) ....”
The claimant has not fully co-operated with the insurer by reason of the following:
(a) a failure to properly and fully complete the employer details section in his application for statutory benefits, and
(b) a failure to provide information reasonably requested by the insurer.
The obligation on the claimant to cooperate under section 6.24 is mandatory. Where a claimant fails to provide sufficient documents and/or fails to provide relevant documents requested by the insurer they potentially do so at their own peril given they bear the onus of establishing a valid claim for statutory benefits. As stated in section 6.24(1)(a) the claimant must provide sufficient information to the insurer for the insurer “to be satisfied as to the validity of the claim”. In this case, the information needs to be sufficient to be satisfied the claimant is an earner for the purpose of the MAI Act.
As merit reviewer my role is to determine what is the correct and preferable decision based on the material before me. The parties may provide further documents or information for the purpose of a merit review. The claimant has provided further documents for the merit review, namely bank records of YRAN, a company search for YRAN, a screenshot of transactions for an unidentified bank account and a drivers’ license for Heng Wang.
It is understood the claimant is unable to provide tax returns or notices of assessment issued by the ATO, as he does not have a tax file number and has not paid any tax on his alleged earnings. On the claimant’s contention he earned significant income over at least two financial years (probably more). The absence of a tax file number indicates he failed to declare this income to the ATO in breach of taxation laws. There is also the possibility that he does not have permission to work in Australia, if he is unable to obtain a tax file number.
The claimant has not provided any explanation for the absence of typical documents expected in an employment arrangement such as payslips or other such wage records issued by the employer. On the evidence currently available it can reasonably be inferred that the claimant entered into a “cash in hand” type arrangement with YRAN. The reasons for this are speculative but might include, for example, that the claimant does not have a visa permit to work in Australia.
Does the evidence establish the claimant was an earner?
In considering the available evidence I note:
(a) evidence of probable employment comprises:
(i)the claimant’s statement in the application for statutory benefits that he worked full time as a gyprocker for YRAN earning $1,530 per week;
(ii)bank statements showing transfers into the claimant’s account with various descriptions, some of which include the word “salary”, and
(iii)bank statements for YRAN showing payments which correspond with most of the transfers relied upon by the claimant in his own bank statements and also include the word “salary” in the description.
(b) there is a company extract which shows YRAN was registered in 2019 and as of December 2021 was the subject of ASIC initiated strike-off action;
(c) there is a drivers’ license for Heng Wang bearing the same name and date of birth as the director of YRAN but a different address to the address for Heng Wang in the company extract;
(d) there is a screen shot of bank transactions for a limited period. The screenshot does not identify the account holder’s name;
(e) there is some inconsistency in the claimant’s evidence, including:
(i)some bank transfers have different descriptions regarding the payer and in some cases, do not identify the payer, and
(ii)even if one accepts all transactions relied on by the claimant are earnings, they do not support his contention in his application for personal injury benefits that he earned $1,530 per week. Total payments in the 52 week pre-accident period are $61,980 which is only $1,191 per week.
(f) absent evidence to the contrary and having regard to the fact the claimant did not have a tax file number and therefore his employer would not have been able to deduct pay as you go tax instalments it must be inferred that any wage payments into the claimant’s bank account are gross (that is, before tax) payments.
The claimant must establish on the balance of probabilities that he was an earner within the meaning in clause 2 of schedule 1. As noted, section 6.24 requires the claimant to provide sufficient information to be “satisfied as to the validity of the claim”. To be satisfied as to the validity of the claim one does not need to be satisfied beyond reasonable doubt. The requirement that one must be “satisfied as to the validity of the claim” is consistent with the civil standard of proof that one must be satisfied on the balance of probabilities.
Whilst the MAI Act requires “verification” of some matters, namely verification of expenses for treatment and care (section 3.27) and verification of the motor accident (sections 6.8 and 6.9) it does not require a standard of proof akin to “verification” in so far as earner status is concerned. Accordingly, as with any civil matter the standard of proof is on the balance of probabilities. I therefore must be comfortably satisfied on the evidence that it is more likely than not that the claimant was an earner within the meaning of schedule 1, clause 2.
On the claimant’s bank statements alone I could not be comfortably satisfied that the claimant was employed or self-employed at any relevant time prior to the motor accident. However, the claimant has provided further documents. Although the documents continue to be somewhat limited and do not include the usual employment records one would expect they point to a probable cash in hand arrangement. The absence of a tax file number for the claimant and the breach of tax obligations by both employer and employee in this circumstance would explain why formal records such as payslips were not created by the employer. Whether the arrangement was unlawful, including whether the claimant has citizenship, residency or visa permission to work in Australia may be a relevant consideration for other matters arising under the MAI Act, but it is not relevant to the discreet issue of whether he is an earner. The claimant may be an earner even if his status as earner was unlawful.
Having considered the totality of the documents carefully I am satisfied on the balance of probabilities that the claimant likely received payment of wages from YRAN during the 8 weeks immediately preceding the motor accident and/or during a period or periods equal to at least 13 weeks during the year immediately preceding the accident. Accordingly, he meets the definition of earner in schedule 1, clause 2 of the MAI Act. In reaching this conclusion
I have had regard to the following:(a) the claimant’s evidence that he worked as a gyprocker for YRAN;
(b) the ASIC company extract recording that YRAN is the subject of strike-off action by ASIC and that ASIC mail to YRAN has been returned to sender. This supports an inference that YRAN did not operate all company business legitimately, including it likely did not keep proper payroll records. This would also explain the claimant’s inability to contact YRAN at the insurer’s request in recent times;
(c) the YRAN bank records which support most of the transactions in the claimant’s bank records;
(d) the reference to “salary” in the description in both the outgoing payments from YRAN’s account and the incoming payments into the claimant’s account, and
(e) the absence of any rebuttal evidence that might displace the claimant’s evidence that he was an employee of YRAN.
Pre-accident weekly earnings
I have carefully examined the bank records of the claimant and YRAN and the screenshot of an unnamed business transaction account. I make the following observations:
Date
Claimant’s bank statements
Supported by YRAN bank statements?
Established as wages on balance?
Amount to be included in PAWE
11/7/20
$3,630
Yes
Yes
$0 (falls outside pre-accident period)
2/8/20
$2,700
Yes
Yes
$0 (falls outside pre-accident period)
23/8/20
$3,780
Yes
Yes
$3,780
13/9/20
$4,050
Yes
Yes
$4,050
10/10/20
$4,050
Yes
Yes
$4,050
1/11/20
$4,050
Yes
Yes
$4,050
22/11/20
$3,510
Yes
Yes
$3,510
12/12/20
$3,780
No
No
$0
31/1/21
$3,500
No
No
$0
21/2/21
$3,700
No
No
$0
20/3/21
$4,320
No
No
$0
10/4/21
$3,900
No – payment appears to have come from a different account, not YRAN’s account. There is no evidence of the owner of this account. It is understood the claimant contends it belongs to Heng Wang, director of YRAN. Even if this is the case, there is no explanation as to why discreet payments were not made from the usual YRAN account. Accordingly, I am not comfortably satisfied that this payment represents wages. It is equally probable that the payment was for something else.
No
$0
2/5/21
$4,180
As above.
No
$0
23/5/21
$4,650
No
No
$0
13/6/21
$5,270
No – payer is identified as “Hao Yin” and there is no evidence of employment with Hao Yin.
No
$0
4/7/21
$4,650
Yes
Yes
$4,650
22/8/21
$4,590
Yes
Yes
$4,590
Total gross earnings on balance in the 12 months before the day of the accident (24 August 2020 to 23 August 2021)
$28,680
I am not comfortably satisfied on the evidence that the payments I have not allowed above represent payment of wages to the claimant by YRAN, or any other employer because:
(a) the transactions are not supported by any independent evidence;
(b) the descriptions vary, including that some reference names that do not appear to be related to YRAN, and
(c) there are similar sized deposit amounts into the claimant’s account, which the claimant states are not wages. The probability that the deposits I have not allowed also do not represent wages arises in the circumstances and is not outweighed by the probability that they are wages. The two probabilities are at least equal meaning the claimant has not discharged his burden of proof in relation to these transactions.
There is no suggestion by either party or in the evidence that the claimant’s PAWE falls for consideration under any of the exceptions in schedule 1, clause 4(2) or clause 4(3). Accordingly, the claimant’s PAWE is to be determined under clause 4(1), which provides:
"Pre-accident weekly earnings”, in relation to an earner who is injured as a result of a motor accident, means the weekly average of the gross earnings received by the earner as an earner during the 12 months immediately before the day on which the motor accident occurred...”
The motor accident occurred on 24 August 2021 and accordingly, the pre-accident period under clause 4(1) is 24 August 2020 to 23 August 2021.
The wages received by the claimant on 11 July 2020 and 2 August 2020, although established on balance, must therefore be disregarded as they fall outside the pre-accident period. Only payments received as an earner within the pre-accident period contribute to calculation of PAWE under clause 4(1). Similarly, any wage payments received after 23 August 2021 are disregarded.
On the basis I have determined the claimant has not established on balance that payments into his bank account between 12 December 2020 and 13 June 2021 are wages these amounts are not included in calculation of the claimant’s PAWE. As noted above I am not comfortably satisfied on the balance of probabilities, based on the evidence before me, that these payments are wages.
As per the above table the total of the claimant’s gross earnings in the period 24 August 2020 to 23 August 2021, which have been established on the balance of probabilities, is $28,680. The claimant’s PAWE is therefore $551.54 ($28,680 divided by 52 weeks).
Although I have determined PAWE on the material before me, the primary basis of this merit review application is the substantive dispute as to whether the claimant is an earner. Whilst it necessarily follows from the insurer’s internal review decision that the insurer has determined PAWE to be nil, given the nature of the substantive dispute the parties may not yet have fully considered their respective positions in relation to calculation of PAWE. Accordingly, it is appropriate that the claimant have an opportunity to provide any further evidence relevant to assessment of PAWE. Should the claimant take this opportunity and provide further evidence to the insurer, the insurer is to carry out any further investigations arising and conduct a fresh internal review to determine the amount of the claimant’s PAWE on the basis the claimant has established, in this merit review, that he is an earner. The issue for any further internal review is therefore limited to recalculation of PAWE based on any further relevant evidence, unless of course other issues arise that impact payment of weekly benefits (for example section 3.21 or the question of post-accident earning capacity).
Lastly, given the apparent “cash in hand” type arrangement between the claimant and YRAN it would be prudent to require the claimant to provide complete copies of his bank statements from 9 September 2021 to date to confirm he did not receive any post-accident earnings from YRAN or any other employer/contractor for the purpose of calculating the difference between PAWE and post-accident earning capacity under section 3.6 and/or 3.7 of the MAI Act.
Presumably the claimant will also need to obtain and provide to the insurer a valid tax file number in his name to enable payment of weekly benefits to the claimant or otherwise disclose to the insurer whether he is lawfully permitted to work in Australia.
CONCLUSION
The reviewable decision is:
(a) set aside;
(b) the claimant is determined to be an earner within the meaning in schedule 1, clause 2 of the MAI Act;
(c) the claimant’s PAWE under schedule 1, clause 4(1) is $551.54;
(d) for the purpose of assisting in calculation of the difference between the claimant’s PAWE and post-accident earning capacity under section 3.6 and/or 3.7 of the MAI Act the claimant is to provide to the insurer a complete copy of his bank account statements for the period 9 September 2021 to date within seven days of the date of this decision, and
(a) should the claimant provide further evidence relevant to assessment of PAWE the insurer is to conduct a fresh internal review as to calculation of PAWE based on that further evidence together with the evidence available to date.
LEGISLATION AND GUIDELINES
In making this decision, I have considered the following:
· The application, reply and supporting documentation;
· The MAI Act;
· Motor Accident Guidelines, and
· Motor Accident Injuries Regulation 2017.
Katherine Ruschen
Merit Reviewer
Personal Injury Commission
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