Majstorovic v AAI Limited t/as GIO
[2023] NSWPIC 185
•5 April 2023
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | Majstorovic v AAI Limited t/as GIO [2023] NSWPIC 185 |
| Claimant: | Nick Majstorovic |
| insurer: | AAI Limited t/as GIO |
| Member: | Hugh Macken |
| DATE OF DECISION: | 5 April 2023 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; non-economic loss; onus to establish economic loss; Fox v Wood; costs and disbursements; claimant is a 55-year-old man who was injured in a motor vehicle accident; the claim is for past and future economic loss including loss of superannuation benefits and non-economic loss; employment by Sydney Trains as a Signal Area Controller; Held – claimant’s legal costs assessed; breach of duty of care and the claimant sustained injury loss and damage as a result of that breach of duty; order for damages and costs. |
| determinations made: | CERTIFICATE OF DETERMINATION Issued under section 94 (5) of the Motor Accident Insurance Act 2017 Assessment of Claim for Damages made in accordance with section 94 of the Act 1. I assess the Claimant’s legal costs and disbursements in accordance with the Motor Accident Insurance Act 2017 in accordance with the attached sheet in the sum of $72,835.16. 2. On the issue of liability for the claim, GIO’s insured owed a duty of care to the Claimant, breached that duty of care and the Claimant sustained injury loss and damage as a result of that breach of duty. 3. I specify the amount of damages for this claim as $1,576,139.40 which includes the statutory benefits paid by the insurer. 4. The amount of the Claimant’s costs, taking into account the amount of damages assessed in respect of this claim, assessed in accordance with the Act is $72,835.16 inclusive of GST. |
STATEMENT OF REASONS
INTRODUCTION
The claimant is a 55 year old man who was injured in a motor vehicle accident which occurred on 23 May 2018. The vehicle in which he was travelling was struck on the driver’s side by the insured’s vehicle in what has been described as an “side swipe”.
The insurer has conceded, following 3 surgical procedures to the lumbar spine which have been found to be injuries arising out of the motor vehicle accident, that the claimant is entitled to non-economic loss.
The claimant, who was employed by Sydney Trains at the date of the accident, has not returned to work. Accordingly, the claim is for past and future economic loss including loss of superannuation benefits and non-economic loss.
There are a number of factors both in relation to the claimant, his employment and the medical material which will have a significant effect on the assessment of this claim noting the very significant difference between the submissions as to quantum made by the parties.
The insurance company has paid past wage loss in the sum of $496,139.40. The parties agree that of this figure $85,000 ought to be allowed for tax paid on past wage loss (Fox v Wood).
The claimant is a 55 year old man who, I accept, was in fairly good health prior to the accident. He states, and I accept, that he pursued interests including photography, (Sydney bands) cooking, gardening and outdoor activities.
Whilst the claimant had been, generally, in previous good health he had, for a protracted period of time, been prescribed anti-depressants following the earlier break down of a long-term relationship.
He had also suffered a fracture to his hand from which he basically recovered. More tellingly he had, in 2013 and again in 2016, problems relating to torn supraspinatus in his shoulder. He had had treatment for these injuries as recently as 2016 and, in 2020, suffered an exacerbation of these injuries.
At the assessment conference I found the claimant to be generally a credible witness. He was questioned at length about the history he had given the medico-legal practitioners who have examined him, particularly in relation to his shoulder. In my view he did answer these honestly although it can be fairly said that he is something of a poor historian. The effect of the history, and his occasional omissions as to the precise detail of his prior shoulder injuries, has been that some of the medico-legal reports do not completely consider all aspects of the claimant’s pre-existing or post-accident difficulties.
The claimant’s employment
10. The claimant was employed as a Signal Area Controller (Gate 3) at the time of the accident. In addition to this the claimant was performing an acting supervisory role
“in which I would be called on to fill in for my supervisor when he was absent”.
The claimant stated:
“I would have pursued promotion to the position of Manager Signalling Operations (MSO) and/or Train Service Delivery Manager.”
11. He states, and there is nothing to suggest otherwise, that:
“I would have kept working to at least age 70”.
12. The submissions made by the insurer make an allowance for the claimant’s net loss from the date of accident to date with an increase of about $40 net per annum which, it submits, is about a 2% annual salary increase. The insurer suggests that the figure ought to be higher and noting an increase of about 5% per annum primarily consequent on a loss of promotional and vocational opportunities should the claimant have been promoted within Sydney Trains.
13. In my view, notwithstanding the somewhat equivocal statement of Louie Samardzioski dated 18 February 2023 I am not satisfied that the claimant has made out that such a promotion would have occurred. That is, that on the balance of probabilities, the claimant would have been promoted to a management role, be it MSO or Train Service Delivery Manager, in the post-accident period.
14. That said, the claimant was functioning well at his job. He was performing 10-15 hours of overtime each week. I accept the statement of Mr Samardzioski that:
“Most people average about 96-100 hours per fortnight but more hours are available for those willing to work them.”
15. I further accept:
“that there is nothing stopping workers in Signalling Complex working into their 70’s provided they are in good health.”
16. In respect to the claimant’s future employment with Sydney Trains, but for the accident, I accept that the claimant’s earnings would have increased. He was clearly seen as a very experienced employee who was good at his job. He was well respected at work and had been promoted to a position of higher responsibility before the accident. It follows, on the balance of probabilities, that such additional responsibilities, and with it increased remuneration would have come to the claimant.
Medical material
17. Both parties agree that the claimant’s injuries exceed the 10% whole person impairment. The claimant has undergone 3 surgical procedures to his lumbar spine which have left him quite disabled. He states, and I accept:
“I can’t sit, I have got to stand, I have got to lie down.”
18. During the assessment conference he was clearly in some distress and needed to take a break to stretch his leg.
19. Following a lumbar spinal surgery he most recently underwent removal of the fixation device in his lumbar spine in August 2021. The report of Dr M. Assem states:
“It is unlikely that he will return to any form of remunerative employment.”
20. I have no difficulty in accepting that the claimant is considerably disabled consequent on the motor vehicle accident. The insurer concedes this. The contentious medical issue between the parties is whether or not he suffered an underlying condition in his low back, congenital pars defects, which would have given him symptoms irrespective of the motor vehicle accident.
21. The report of Dr Shattwell dated 23 December 2022 states that the claimant:
“would have developed symptoms from his lumbar spinal degenerative disc disease whether or not the accident described had occurred.”
22. This position was re-iterated by Dr Keller who refers to:
“100% deductible from his prior condition.”
23. The report of Dr Charles New states:
“If there was anything to be deducted, again this would be one tenth.”
24. I accept the claimant was troubled with a lumbar spinal condition which, though asymptomatic, could have had an adverse effect on his physical capacities as the years went by. This is a possibility which ought to be considered and ought to be put no higher than that.
25. The claimant also sought to include some ongoing shoulder injuries which he contends arise from undertaking a rehabilitation program. He states that in about October 2019 upon his return from Greece, he was undertaking exercise and sustained pain to both shoulders. As was dealt with at the assessment conference there were numerous attendances with medical practitioners in the months following this before there is any documentary evidence of a shoulder injury. That is, he attended doctors in October 2019, 4 times in November 2019, twice in December 2019, 3 times in January 2020 and before there is finally a mention of it on 11 February 2020 as “worsening left shoulder pain 3 months? Cause.”
26. The claimant goes on to state:
“Dr Gupta advised me that I should have surgery for a right rotator cuff repair.”
27. I am not satisfied that the claimant has established that the shoulder injury is an injury arising directly out of the accident. He had previously had shoulder problems in 2013 and 2016. He was a number of years after the accident that the shoulder problems complained. The onus is on the claimant to establish the cause of the injury. It may be that the injury developed over time. It certainly was a difficulty which the claimant suffered from prior to the accident. The absence of any material supporting the onset of injury for some 4 months after its onset supports the insurer’s contention that it is not an injury which arises either out of the motor vehicle accident or as a direct result of a specific incident which occurred whilst the claimant was undergoing rehabilitation exercises in respect to his lumbar spinal condition.
28. The claimant alleged that he has suffered a significant psychological injury. At the assessment conference he agreed that he has not been attended a psychologist or psychiatrist since the accident. He also agreed that he had been prescribed Zoloft, an antidepressant medication, prior to the accident although subsequent to the accident his dosage had been increased. The claimant sought to rely upon a report of Dr Rastogi dated 11 June 2021. This noted his current symptomology, an extensive work history and gave a diagnosis of a major depressive order with chronic pain disorder and alcohol abuse disorder.
29. The insurer relies upon a report of Dr G. Vickery dated 30 May 2022 who states that the claimant:
“did not report there was any depression however there was some anxiety regarding his current medical symptoms.”
He goes on to say:
“There are no psychological injuries due to the motor vehicle accident.”
30. I accept that the claimant is not happy with his current circumstances. He has gone from a long life of full employment to a life where he is now significantly disabled, currently not working and has concerns about his future. That said, I do not accept that the material, particularly the medical material supports this contention of psychiatric injury noting that he has not attended either a psychologist or psychiatrist in respect to any ongoing psychiatric disability. I accept the insurer’s submissions that the claimant has not suffered a psychological or psychiatric injury consequent on the motor vehicle accident other than a feeling of general malaise and unhappiness in what can fairly be described a significant and disabling back condition.
Non-economic loss
31. The claimant continues to suffer significant physical problems consequent on the injury. The insurer submitted that an appropriate figure for non-economic loss was $250,000 whilst the claimant submitted that an appropriate figure would be $450,000.
32. The significance of the injuries on the claimant ought not be understated. They have had consequences on both his capacity to work as well as greatly eroding his self-esteem. He has difficulties sitting for prolonged periods of time. He describes the pain as unrelenting. He contends that he is anxious and depressed much of the time. In general that his life has taken a very significant turn for the worse as a consequence of the significant lumbar spinal injury he sustained in the accident and the subsequent surgical procedure.
33. In all the circumstances I assess the claimant’s non-economic loss in the sum of $300,000.
Past economic loss
34. The calculations in respect to past economic loss are simply that. The claimant has not worked since the accident and, as my assessment of the claimant on the medical material bears out, I accept that he has been unable to work since the accident. The insurer’s submissions suggest an allowance ought to be made on the basis of a loss of promotion which they contend on the balance of probabilities the claimant would have received but for the accident and accordingly economic loss ought to be allowed of a figure in the order of $442,447 noting past economic loss of between $1,675 per week and $1,875 per week currently. Their further submission was that this figure ought to be significantly reduced to take into account the claimant’s lumbar spine becoming symptomatic regardless of the accident, the shoulder symptoms developing subsequent to the accident and a residual earning capacity which the claimant has not exercised.
35. In my view there is some merit in these submissions put by the insurer. Similarly, there is significant material to show that the claimant could have earned significantly more had he been able to continue in his employment. This would be partly as a result of pay increases beyond that which the insurer makes an allowance for, noting the claimant could have continued to at least act on the higher duties which he was performing at the time of the accident and, as the material bears out, the availability of significant overtime.
36. Further, the figures identified by the insurer do not take into account the claimant’s entitlement to a Fox v Wood component of the insurer’s payments nor the benefit which would accrue through employer superannuation contributions.
37. I do not accept the claimant’s submissions that his pay would have increased by some $500 net per week between 2018 and 2022. This was put on the basis that he would have achieved career advancement and promotions which, as I have set our above I do not accept.
38. Noting the above, and in particular the vagaries associated with trying to calculate the period in which the claimant would have acted in higher duties, what amount of overtime would have been available to him and what the reality of comparable wage earners to the position that of the claimant would have been I consider it appropriate to provide a buffer for past economic loss noting the uncertainties associated with such calculations but generally accepting the calculations made by the insurer without the deduction.
39. In my view taking these figures and adding the calculations of about 12% for future loss of superannuation benefits I assess the claimant’s past economic loss in the sum of $130,000. I note this figure is in addition to the payments made by the insurer totalling $496,139.40. This figure takes into account additional losses associated with loss of some wage increases and loss of earnings together with the allowance for Fox v Wood and superannuation.
Future economic loss
40. The claimant states, and there is no evidence to specifically contradict his assertion, that:
“there is no forced retirement age, and I would have kept working to at least age 70. Many Sydney Train employees continue working into their seventies.”
41. This assertion was supported by Louis Samardzioski who stated:
“There is nothing stopping workers in the Signal’s Complex working into their seventies provided they are in good health.”
42. Ordinarily, and if the claimant was never to work again solely as a consequence of the injury sustained in this accident, future economic loss could be worked out with some precision. That said, there are number of additional factors which need to be taken into account. Firstly, the claimant does have a residual earning capacity. He is significantly disabled but it would not accord with the reality to simply assert that at the age of 55 he has no capacity to undertake any type of remunerative employment again. He is significantly disabled and quite unhappy with his circumstances but, as I have indicated above, he has a solid work ethic and a history of employment for basically all his adult life. He still has skills to offer a prospective employer although it is fair to say that he is very greatly diminished in the skills that he can offer prospective employers consequent on his debilitating back condition.
43. Secondly, there are other factors which may have had an adverse effect on his earning capacity in any event. In particular he has some ongoing shoulder problems which have an adverse effect on his capacity to undertake day to day activities. Thirdly, noting that he was intending to work to age 70, other non-accident related health factors, such as his pre-existing lumbar spinal condition, may have come into play in respect to his work life longevity.
44. The primary difficulty with the claimant returning to his employment is the injuries sustained in the accident of 23 May 2018. That said, noting the vagaries associated with any such calculation in my view it is appropriate to allow a buffer loosely based on a 70% of his net earnings and allowed to age 70 with an increased reduction for vicissitudes of 25%. To this figure would need to be added the losses associated with his employer superannuation contributions.
45. There is significant uncertainty that surrounds such calculations as is inherent when attempting to ascertain intangible such as residual earning capacity, effects of non-accident-related medical conditions and variable working conditions such as availability of overtime and the like.
46. Noting these matters I assess the claimant’s future economic loss, including loss of superannuation benefits in the sum of $650,000.
Assessment of Damages Summary
47. I assess the claim as follows on the findings set out above:
Non-economic loss $300,000.00
Economic losses
·Past loss of earnings (incl. superannuation and Fox v Wood) $ 626,139.40
·Future loss of earnings (incl. superannuation) $ 650,000.00
Total of economic losses and non-economic loss $1,576,139.40
Total Damages Assessed $1,576,139.40
The claimant’s economic loss is to be reduced by, and the insurer is to have credit for, the following payments:
Statutory Benefits $496,139.40
Conclusion
Costs and Disbursements
48. I assess the Claimant’s legal costs and disbursements in accordance with the Motor Accident Insurance Act 2017 in accordance with the attached sheet in the sum of $72,835.16.
49. On the issue of liability for the claim, GIO’s insured owed a duty of care to the Claimant, breached that duty of care and the Claimant sustained injury loss and damage as a result of that breach of duty.
50. I specify the amount of damages for this claim as $1,576,139.40 which includes the statutory benefits paid by the insurer.
51. The amount of the Claimant’s costs, taking into account the amount of damages assessed in respect of this claim, assessed in accordance with the Act is $72,835.16 inclusive of GST.
Legislation
In making my decision I have considered the following legislation and guidelines:
·Motor Accident Insurance Act 2017
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