Mazry v Insurance Australia Limited t/as NRMA Insurance
[2025] NSWPICMR 28
•24 September 2025
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
CITATION: | Mazry v Insurance Australia Limited t/as NRMA Insurance [2025] NSWPICMR 28 |
CLAIMANT: | Sam Mazry |
INSURER: | Insurance Australia Limited t/as NRMA |
MERIT REVIEWER: | Jeremy Lum |
DATE OF DECISION: | 24 September 2025 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; no dispute claimant is an earner and was injured in the motor accident; whether claimant entitled to weekly payments of statutory benefits; calculation of pre-accident weekly earnings (PAWE); whether claimant received director fees from the company; absence of personal income tax return; company tax documents do not include director fees; Held –not satisfied the claimant was paid director fees; PAWE calculated as nil; insurer’s reviewable decision affirmed. |
DETERMINATIONS MADE: | CERTIFICATE The reviewable decision is about the calculation of the claimant’s pre-accident weekly earnings (PAWE) which concerns 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. I make the following determinations: 1. The reviewable decision of the insurer is affirmed. A brief statement setting out my reasons for the decision is set out below. |
STATEMENT OF REASONS
BACKGROUND
Mr Sam Mazry (the claimant) was involved in a motor accident on 22 August 2024.
The claimant says he sustained injuries to his neck, right shoulder, back, right knee, right ankle as well as shock and anxiety as a result of the motor accident.
The claimant made a claim for statutory benefits with Insurance Australia Limited t/as NRMA (the insurer), the third-party insurer of the vehicle that he says caused the accident.
At the time of the motor accident, the claimant was sole director and shareholder of the company Justmed Medical Fitouts Pty Ltd (the company).
The insurer was satisfied that the claimant was an earner[1] and in a decision dated
11 September 2024, made interim weekly payments of compensation in the amount of $572.88 per week. This was done while the insurer gathered information regarding the claimant’s pre-accident weekly earnings (PAWE).[1] Only a person who was an earner when injured is entitled to statutory benefits under Division 3.3 of the MAI Act.
On 27 November 2024, the insurer made a decision calculating the claimant’s PAWE in the amount of $nil. Following a request from the claimant, the insurer conducted an internal review and, in a decision dated 17 December 2024, affirmed its decision that the claimant’s PAWE is $nil. These decisions of the insurer comprise of the “reviewable decision”.
The claimant subsequently lodged an application for merit review of the insurer’s reviewable decision at the Personal Injury Commission (Commission). I have been asked to deal with the application as the Merit Reviewer.
DECISION UNDER REVIEW
As mentioned above, the decision under review is the insurer’s reviewable decision which calculated the claimant’s PAWE at $nil.
The insurer noted that the claimant provided his company’s tax return for the year ended 30 June 2024, profit and loss statement for the year ended 30 June 2024 and business activity statements for July 2023 to June 2024.
The claimant noted that the company’s business activity statement for the periods September 2023 and October 2023 indicate total salary and wages of $3,000 have been paid per period.
The insurer stated that it had requested the claimant’s individual tax return for the year ended June 2024, payslips for the months September 2023 and October 2023 or any bank statements during these periods to verify that he was in receipt of this salary or wage.
The insurer noted that to date, the claimant had not provided the above information.
The insurer referred to the merit review decision in Patton v Allianz v Australia Insurance Limited (No 1)[2] (Patton) where it concluded that:
(a) even where a claimant is the sole director and owner of a company through which they exercise their earning capacity, at law it is the company that carries on the relevant business (as a company is a separate legal entity), not the claimant, and
(b) therefore, when calculating a claimant’s PAWE in those circumstances, the claimant’s “earnings” are the amounts received as remuneration by the claimant from the company (e.g. wages / director’s fees etc.), rather than the proceeds (i.e. the profits) of the relevant business.
[2] [2022] NSWPICMR 45.
The insurer concluded that in accordance with the decision in Patton, it found the claimant’s PAWE to be $nil.
CLAIMANT’S POSITION
Background
The claimant stated that the company provides design, build and fit out services to general practitioners (GP), specialists, pharmacies and other health care providers.
There was a total of three employees in the company.
The claimant’s role was to manage projects, conduct site inspections, organise tradies, order building material and other business management duties.
He said that upon completion of a job, an invoice would be issued and payment was made by the customer either directly into the bank account of the business via bank transfer or via EFTPOS payment.
Claimant’s earnings
The claimant says his company made a total gross profit of $1,639,039.76 as evidenced by the business’ Profit and Loss Statement for the year ending
30 June 2024.From those profits, the claimant was paid a director’s fee of $188,650. The claimant therefore submits his earnings were $3,627.88 for the 52-week period before the motor accident ($188,650 / 52).
Statement of claimant dated 21 March 2025
The claimant says he paid himself a wage from the business profits into three bank accounts, comprising of two personal accounts and one joint account with his wife. The bank transfer description was “Project Management” which reflects one of the functions of his role as director. There were also transfers made from the company’s bank account number ending 261 into his personal account.
From 22 August 2023 to 21 August 2024, the claimant says he was paid $52,451.82 (personal account No1), $354,736.80 (personal account No2) and $116,027.70 (joint account). This totalled $523,214 which was $10,061.80 per week (before tax) for the 52 weeks before the accident.
The claimant also stated that he has not lodged personal tax returns for the relevant period.
Supplementary statement of claimant dated 26 May 2025
In the supplementary statement, the claimant confirms that he made $188,650 (or $3,627.88 per week) from his personal exertion as director of the company for the year ending 30 June 2024.
The claimant says there are two copies of the 2024 Profit and Loss Statement with the correct one being that which contains the director fees. He says the previous one was “amended due to accounting errors”.
Profit and Loss Statements
There are two company Profit and Loss Statements for the year ended 30 June 2024. These indicate a total trading income of just over $3m with cost of goods sold totalling approximately $1.38m. The operating expenses are itemised and total $1.58m for the first statement and $1.39m for the second statement.
The only difference between the two statements is the inclusion of “director fees” for the amount $188,650 for one of the statements.
To account for the “director fees”, the net profit of the company was therefore reduced accordingly from one statement to the other – $246,732.73 to $58,082.73.
St George bank – company bank account statements
This shows all transactions in the relevant period with yellow highlighted transactions of deposits made out of the company account and Osko Deposits with the description “Project Management”. There were also two highlighted transactions with the description “Loan.”
INSURER’S POSITION
The insurer says the claimant is an earner and is therefore entitled to statutory weekly benefits. The calculation of the claimant’s PAWE is the 12 months immediately before the day of the motor accident and confirmed that the period for the calculation is from 22 August 2023 to 21 August 2024 (the relevant period).
The insurer relies on two reports prepared by forensic accountant Mr Lance Kahler, CPA, from Vincents:
· report with attachments dated 5 December 2024, and
· supplementary report with attachments dated 5 August 2025.
The insurer notes that the total wages reported in the Company’s Business Account Statements for September 2023 and October 2023 was $6,000 (comprising of $3,000 each month). The insurer submits that while it is possible the wages reported in the company’s BAS were payments of wages and/or director fees to the claimant, the claimant has not provided his individual tax return for the year ended 30 June 2024 or any payslips or bank statements to verify the receipt of those payments.
The insurer noted that the following documents were requested but not provided:
· if the company maintains digital accounting records (e.g. Xero, MYOB etc), a profit and loss report for the period from 22 August 2023 to
21 August 2024;· Mr Mazry’s individual tax returns for the years ended 30 June 2023 and 2024, and
· if the company paid Mr Mazry salary and wages, copies of Mr Mazry’s payslips from 1 July 2023 to 21 August 2024 and his personal bank account statements to which wages were paid for that period.
The insurer further noted that of the bank statements provided in the merit review application, there are no identifying features – such as account holder’s name, address, or account number – that would confirm they belong to Mr Mazry. As such the insurer submits that it is unable to rely on these documents in order to verify whether Mr Mazry received any wages or director fees from the company.
The insurer maintains that the claimant’s PAWE should be calculated at $nil.
RELEVANT LEGISLATION
Division 3.3 of the MAI Act deals with an injured persons entitlement to weekly payments of statutory benefits.
Sections 3.6 and 3.7 sets out an entitlement to weekly payments calculated with reference to the “pre-accident weekly earnings.”
Schedule 1 of the MAI Act sets out the definitions relating to “earner” and “pre-accident weekly earnings” for the purposes of statutory weekly payments under Division 3.3.
Pursuant to Schedule 1, cl 4 of the MAI Act, PAWE means:
“(1) ‘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...”
DISPUTE RESOLUTION
Preliminary conferences were held with the parties on 23 June 2025 and
18 August 2025.The following matters were agreed:
(a) the claimant was a self-employed sole director and shareholder of the company;
(b) the claimant was an “earner” for the purposes of the definition in schedule 1 of the MAI Act, and
(c) the calculation of the claimant’s PAWE falls under Schedule 1, cl 4(1) of the MAI Act (reproduced above in paragraph 39).
I indicated that it was unclear from the provided bank account statements what amounts the claimant actually received as wages or director fees. I also noted that the BAS only states that wages were paid in the amount of $6,000 for the months of September and October 2023.
The claimant subsequently clarified in a statement dated 16 July 2025 that the $6,000 recorded in the BAS referred to wages paid to a worker whom the claimant had for a short period of time as a subcontractor. He says his own earnings were not recorded in the BAS and that his accountant has properly reflected his director fees as per the Profit and Loss Statement.
The claimant also provided complete bank statements for his two joint accounts with his wife for the relevant period.
The claimant further submitted that “the structure of his business was quite informal and his bookkeeping was not kept in the order of a traditional business”.
The claimant confirmed that he has not lodged a 2024 tax return to date.
The claimant submits that the lack of reference made in the claimant’s bank statement description to “director fees” should not be a basis to calculate the claimant’s PAWE at $0. The claimant says he is entitled to manage his funds according to his personal preferences.
MERIT REVIEW
In determining the merit review, the Merit Reviewer is to decide what the correct and preferable decision is having regard to the material before the Merit Reviewer including any relevant factual material and the applicable written or unwritten law.[3]
[3] Section 7.13(1) of the MAI Act.
The Merit Reviewer may exercise all the functions under the MAI Act on the insurer.[4]
[4] Section 7.13(2) of the MAI Act.
In determining a merit review application, the Merit Reviewer may decide:
(a) to affirm the reviewable decision; or
(b) to vary the reviewable decision; or
(c) to set aside the reviewable decision and make a decision in substitution for the reviewable decision the merit reviewer set aside, or
(d) to set aside the reviewable decision and remit the matter for reconsideration by the insurer in accordance with any directions of the merit reviewer.[5]
[5] Section 7.13(3) of the MAI Act.
The Merit Reviewer is to issue the parties with a certificate as to the determination and is to attach a brief statement to the certificate setting out the reviewer’s reasons for the determination.[6]
CONSIDERATION OF THE ISSUES
[6] Section 7.13(4) of the MAI Act.
I note that there is no dispute that the claimant is an earner and was injured as a result of the motor accident. He is therefore entitled to statutory benefits.
The issue to be decided is whether the claimant received earnings in the form of director fees and if so, how much, in order to calculate his PAWE in accordance with Schedule 1, cl 4 of the MAI Act for the relevant period.
As stated earlier, the claimant is the sole director and shareholder of the company.
Although I am not bound by the decisions of previous Merit Reviewers or Merit Review Panels, I see no reason to depart from the findings of Patton. Namely, that it is the company that carries on the relevant business as a separate legal entity. The claimant’s earnings are the amounts received as renumeration from the company as director fees and not the profits of the business.
I note that the claimant’s submissions do not appear to cavil with the application of Patton, as the claimant acknowledges the original sum of $523,214 cannot be claimed as his own gross earnings received from personal exertion, “but includes other profits made by the business received outside of his personal contributions to the business”.[7]
[7] At paragraphs 6 and 7 of the additional submissions dated 18 August 2025.
The claimant maintains that he was in receipt of $188,650 for his personal exertion for the 52 weeks before the motor accident and relies on the company’s amended Profit and Loss Statement.
The relevant bank account statements that are before me are:
company accounts:
·Justmed Medical Fit outs St George account ending in 261, single page, covering the period 8 February 2025 to 7 March 2025, and
·Justmed Constructions Pty Ltd St George account ending in 417, covering the period from 3 June 2023 to 2 September 2024.
personal joint accounts:
·St George joint account held by Mr Mazry and Mrs A El Masri ending in 562, covering the period from 4 May 2023 to 3 November 2024, and
·St George joint account held by Mr Mazry and Mrs A El Masri ending in 478, also covering the period from 4 May 2023 to
3 November 2024.
The payments made into account ending 562
For the claimant’s joint account ending in 562, I note that there are regular deposits ranging from $800 to $1,500 made throughout the 12 months before the accident. These deposits are highlighted yellow by the claimant in the bank statements provided for the relevant period. The description is “Internet Deposit” and are all from the Justmed Medical Fit outs account ending 261[8].
[8] With the exception of payment dated 30 March 2024 which was from Justmed Constructions Pty Ltd account ending 417.
I accept the insurer’s submission that the payments made do not specifically state that the payments are for “director fees”. The claimant says this, however, should not be a basis to calculate the claimant’s PAWE at $nil. The claimant argues that he is entitled to manage his funds according to his personal preference(s) and should not reflect his PAWE.
I accept that there are deposits made from the company account ending 261 to the claimant’s joint account ending 562. The payments received in the relevant period total $50,200.
I note that the regularity of the payments and the consistency of the amounts paid supports the claimant’s contention that the deposits could be earnings received.
However, there is documented evidence to argue against the claimant’s position that the amounts paid are in fact earnings received by the claimant as an earner.
First, the claimant is the company’s sole director and shareholder and received director fees as payment for his personal exertion. To date, there is no company constitution or any other document that sets out how or when the claimant was to be renumerated.
Second, if the deposits made from the company into the claimant’s joint account are in fact payments of director fees, this should be appropriately stated in the description. As noted above, the transaction description only says “Internet Deposit” which could comprise of any type of payment made into the claimant’s joint account.
Third, the claimant has not provided the company’s bank statement for the account ending 261 to verify the transactions made out of the account and into either of the claimant’s joint accounts. Only the first page is provided and this refers to a 2025 statement that is outside of the relevant period.
Fourth, the claimant has not provided any official personal tax documents (such as an income tax return for any year) to show amounts were paid to him as director fees by the company.
Fifth, there is a notable absence of director fees in the original company Profit and Loss Statement. It is unconceivable that an amount of this magnitude ($188,650) could be simply left out of the original ledger due to “accounting errors”.
Sixth, and perhaps the most fatal to the claimant’s position, is the absence of any director fees (or any salaries/wages paid) in the official company tax documentation, namely the 2024 company tax return and in the monthly activity statements. As held in Patten, as company director, the claimant’s earnings are the amounts received as renumeration from the company as director fees. As the company did not pay director fees, the claimant’s position cannot be maintained or justified.
I therefore cannot be satisfied, on balance, that the amounts made into the claimant’s joint bank account ending 562 constituted earnings received by the claimant as an earner for the relevant period.
The payments made into account ending 478
This is also a joint account held in the name of the claimant and his wife. The claimant claims amounts paid as cheque deposits ($49,507), Grays ($41,082) and James Talari Pty Ltd ($20,000) as income from his personal exertion.
I note that these payments are irregular, do not contain any reference to director fees and there is no supporting documentation to indicate that they are earnings received by the claimant as an earner.
For the same above reasons for the account ending 562, I am not satisfied the amounts constitute earnings received by the claimant as an earner for the relevant period.
The payments made into account ending 417
The payments made into this account were either internet or Osko deposits with the description “Project Management”. While the claimant describes his duties as including project management, the account ending 417 is a company account and are not therefore amounts received by the claimant as renumeration from the company as director fees.
CALCULATION OF PAWE
On the information before me, the correct and preferable decision is that the claimant’s PAWE is $nil.
The insurer’s reviewable decision is therefore affirmed.
Should the claimant have additional information to substantiate the amounts claimed as his earnings, he can provide this documentation to the insurer who can make a new decision on his statutory entitlements.
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