QBE Insurance (Australia) Limited v Wallace
[2024] NSWPIC 21
•17 January 2024
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | QBE Insurance (Australia) Limited v Wallace [2024] NSWPIC 21 |
| CLAIMANT: | Katie Wallace |
| INSURER: | QBE |
| MEMBER: | Shana Radnan |
| DATE OF DECISION: | 17 January 2024 |
| CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; settlement approval $306,447; 24-year-old female; past and future economic only; future loss buffer $250,000. whole person impairment (WPI) 0% for psychological injuries; physical injuries WPI 5%; lumbar injury ongoing pain, impact on lifting capacity; section 6.23; Held – proposed settlement is just, fair and reasonable; settlement approved. |
| DETERMINATIONS MADE: | CERTIFICATE Settlement approval 1. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017. 2. The proposed settlement complies with cl 7.37 of the Guidelines. |
STATEMENT OF REASONS
INTRODUCTION
On 11 September 2019, Katie Anne Wallace (the claimant) was a passenger in a vehicle which swerved to avoid a kangaroo and lost control and ended up in a ditch near the intersection of Panai Avenue and Newell Highway at Dubbo.
The claimant sustained injuries in the accident. She was taken to Dubbo Base Hospital by Ambulance and was discharged on 19 September 2019. She lodged an application for personal injury benefits (document A3) on 18 September 2019.
Ambulance records (document A12) confirmed the claimant’s initial injuries so too the hospital discharge records.
Police attended the scene.
The claimant remained under the care of her general practitioner for review and management Dr Sunil Jacob.
The claimant has made a claim against QBE (the insurer) of the at fault vehicle, for lump sum damages in an application for common law damages dated 4 September 2021 (document A4). By liability Notice (document A15) dated 23 November 2021, the insurer wholly admitted liability for the common law damages claim.
The claimant claimed that she sustained injury in the accident to the following areas of her body:
(a) L1 vertebral crush injury with retropulsed fragment extending 5mm into the spinal canal.
The insurer has accepted that the claimant had sustained non-threshold injuries and pursuant to Division 3.4 of the Motor Accident Injuries Act 2017 (the MAI Act) she is entitled to payment of reasonable treatment if required.
The insurer relied upon the medico-legal assessment undertaken by Dr Raymond Wallace and his report dated 10 June 2022 (A8). He opined that the lumbar condition was caused by the accident. She did not require operative intervention and would not benefits three years post injury from ongoing physiotherapy or exercise physiology. He considered her condition as guarded. He considered her condition had stabilised and made an assessment of 5% whole person impairment.
He further opined that she had no evidence of ongoing disability at her lumbar spine on clinical examination when examining her on 7 June 2022. He considered she was fit to return to pre-injury duties as a barmaid working 30 hours per week.
Further medical assessments were undertaken by Dr Vickery (A9) for psychological injuries. He opined that she may have a somatoform chronic pain disorder but found it unrelated to the accident. He commented that “There is a positive prognosis for improvement and recovery with psychological counselling and attending the Royal North Shore Pain programme.” He assessed her whole person impairment as 0%.
The claimant and the insurer have agreed to settle the claim for lump sum damages in the sum of $306,447. The initial application referred to a settlement offer made by the insurer on 12 and 31 October 2023 in the sum of $255,000. The insurer increased its offer to $306,447 after further negotiations between the parties took place after the preliminary conference of
6 December 2023. The claimant and insurer were requested to review future economic loss in the light of Dr Wallace considering her prognosis as “guarded.” The insurer agreed to revisit their offer.On 13 December 2023 the insurer confirmed the basis of this latter offer was as follows:
(a) Past economic loss total $56,447:
(i)weekly payments $41,976.21;
(ii)past superannuation (12%) $5,500, and
(iii)tax paid on statutory benefits $947.
(b) Future economic $250,000 inclusive of superannuation:
A further preliminary conference took place on 19 December 2023 with the claimant, her mother and Mr Lal. The claimant was questioned as to her understanding of the settlement, the finality of a settlement and confirmed she wished to accept the amended offer and for me to approve the settlement. The parties requested that I approve the amended terms of settlement.
As the claimant is not represented by a lawyer, the settlement must be approved in accordance with the MAI Act and relevant Guidelines.
JURISDICTION OF THE PERSONAL INJURY COMMISSION
The Personal Injury Commission (Commission) was established on 1 March 2021.
I am a Member of the Motor Accidents Division of the Commission. Clause 14(A)(1) of the Personal Injury Commission Regulation 2020 designates the application “pre-establishment proceedings” and cl 14(D) empowers me to determine these proceedings.
Because of the date of the accident cl 14(D)(3)(b) provides that the MAI Act and the Motor Accident Guidelines (the Guidelines) apply to this matter.
THE RELEVANT LAW
Under ss 6.23(2) and (3) of the MAI Act before the Commission may approve the settlement of a claim for damages, it must be satisfied that the proposed settlement complies with any of the requirements of the MAI Act or the Motor Accident Guidelines.
Clause 7.37 of the Guidelines states I must be satisfied as to the following:
“(a) (deleted)
(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, and
(c) the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner
(d) The claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.”
DOCUMENTS CONSIDERED
I had regard to the following relevant documents contained in evidence bundle which included the following:
Liability:
· application for statutory benefits dated 18 September 2019;
· application for common law damages dated 4 September 2021;
· liability notice dated 23 November 2021, and
· whole person impairment letter dated 12 October 2023 (document A6).
Medico-legal opinion:
· report of Dr Raymond Wallace orthopaedic surgeon medico-legal dated
10 June 2022(document A8);· report of Dr Graham Vickery psychiatrist dated 16 August 2022 (document A9), and
· adapt program report dated 24 May 2023.
Economic loss material:
· particulars (document A10);
· certificates of capacity (document A11);
· statutory payments made (document A7), and
· earning capacity assessment.
Settlement documents:
· initial draft settlement agreement (document A6), and
· amended settlement agreement dated 13 December 2023.
REVIEW OF THE EVIDENCE
Statement of the claimant
The claimant provided a details response to requested particulars (document A10).
Review of this information gave details of the pain and suffering the claimant has experienced as a consequence of her injuries. The claimant has not been able to participate in her regular social and recreational activities due to her ongoing lumbar pain.
She has experienced ongoing panic attacks and anxiety.
She has not been able to return to bar tending and has managed to obtain alternate employment as an administrative assistant.
Her ability to work on farms is now unsuitable as she is restricted in her capacity to lift item and has a restriction to 10kg and the work would be too heavy for her to undertake. Her family have now sold their farm and her opportunity to work within the family business is no longer available.
INJURIES
The clinical records produced in the matter confirm that the claimant initially sustained the following injuries:
· injury to her lumbar spine, and
· psychological injury due to chronic pain.
I note the assessments of Drs Wallace and Vickery and accept that the medical evidence does not support any entitlement to non-economic loss. Whilst the claimant is unable to obtain damages for her pain and suffering, I acknowledge that the injuries have had a profound affect upon her.
The ADAPT discharge report dated 24 May 2023 confirms the claimant’s increased capacity.
The report noted:
“She reports working full-time hours (34hrs) despite pain. ..Ms Wallace’s increased activity levels and goal achievement are consistent and effective use of program strategies ..Ms Wallace reports making good progress with reducing her social anxiety and continues to see her local psychologist.”
ECONOMIC LOSS
Past economic loss
At the date of the accident the claimant was working part-time as a casual bar tender at Dubbo RSL. She left school aged 15 completing year 10.
She held a desire to work in the agricultural sector and spent two years at Tocal Agricultural College between 2016 and 2017 obtaining Certificates III and IV in Agriculture. She had also obtained Certificate II in animal studies hoping to work upon the family farm.
Due to devastating droughts the claimant was forced to obtain employment outside the farm before the motor vehicle accident.
It was always her intention to return to agriculture some time in the future when conditions in that industry improved. When this would take place is unknown due to the significant variable with the industry and impact of climate and market factors.
The claimant as at the date of the accident was earning $520 gross weekly as a bar attendant. She was working approximately 30 hours each week at a local RSL club. Statutory payments were made in accordance with s 4A of the Motor Accident Injuries Indexation Order 2017 and the amount increased to $746 net per week.
Post accident she has been deemed fit to return to work by Dr Wallace in her pre-injury duties as a bar tender from an orthopaedic perspective. Dr Vickery found no impairment to earning capacity from psychological injuries.
The insurer assessed past loss in the sum of $50,000, past superannuation in the sum of $5,500 and tax paid of $947.
Statutory payments made to date amounted to the sum of $41,976.21 which the insurer seeks credit.
Total past losses were agreed in the sum of $56,447.
Future economic loss
The claimant is currently in full-time work and the insurer has accepted that she will have ongoing restrictions in obtaining work in farm related activities due to her lumbar spine pain.
The claimant turns 24 in February and has a further 43 years until retirement. Whilst
Dr Vickery found no impairment and Dr Wallace considered her fit to return to pre-injury duties, it has been accepted by the insurer that her ongoing pain and restriction on activities of lifting no more than 10 kg, she will likely suffer future economic loss.A buffer of $250,000 inclusive of superannuation losses was the sum agreed to by the claimant and the insurer.
SHOULD I APPROVE THE SETTLEMENT
I am satisfied that the amounts allocated in the settlement for past and future economic losses accord with the evidence provided by the claimant and the insurer in this matter and are within the range of likely potential damages assessment for the claim were the matter to be assessed by a Member of the Commission, taking into account the nature and extent of the claim and the injuries, disabilities, impairments and losses sustained by the claimant.
The injuries sustained in the subject accident have ongoing impact which will be lifelong. Pain management and ongoing psychological session has improved the claimant’s ability to undertake work and social activities The claimant has limited ongoing treatment needs and in majority she has made a significant recovery from the injuries sustained. The ongoing lumbar pain will be aggravated from time to time by over exertion or activity.
The past economic losses were supported by medical certificates for the period immediately post-accident and the claimant received statutory benefits at the time. The statutory amount was an increase on her pre-injury earning capacity. I am satisfied that the past and future losses accord with the claimant most likely circumstances but for the accident.
The claimant is aware that from her settlement the insurer will deduct the already paid statutory benefits in the sum of $41,976.21 and that she will receive the balance in sum of $264,470.79.
In assessing future economic loss, I must have regard to the provisions of s 4.7 of the MAI Act which states no allowance may be made for future loss of earning capacity unless the claimant establishes that the accident has caused a change in her most likely future circumstances.
In cases such as Medlin v State Government Insurance Commission (1995) 185 CLR and Husher v Husher (1999) 197 CLR 138, the High Court confirmed that the fundamental questions to be determined in a case such as this, are whether the claimant has sustained a loss or diminution in her earning capacity and, if so, whether that loss or diminution will result in economic loss. The circumstances in this matter accord with the most likely circumstances but for the accident. The allowance of a buffer for future economic loss is appropriate where a weekly sum cannot be established.
I am satisfied that the claimant is aware of her right to claim any ongoing treatment needs if approved by the insurer.
There is no known Centrelink payback and no monies to Medicare owing under the Health and Other Services (Compensation) Act 1995 (Cwlth) from the settlement sum. If any charge is raised the insurer will pay the charge as a treatment expense in addition to the settlement sum. The only deduction would be the statutory weekly payments already made to date in the sum of $41,976.21.
I advised the claimant if a charge is raised by Medicare in respect of treatment expenses paid by Medicare relating to the injury, she should refer the matter to the insurer to pay that charge as part of their obligation to pay reasonable treatment costs.
CONCLUSION
I am satisfied the proposed settlement of $306,447 is just, fair and reasonable and within the range of likely potential damages assessments if the claim was to proceed to assessment by a Member of the Commission taking into account the nature and extent of the claim, the injuries, disabilities, impairments and losses sustained by the claimant.
I am satisfied the claimant was aware she could seek legal advice but chose not to avail herself of legal representation.
I am satisfied the claimant understands the binding nature of the settlement and that she will be precluded from making a further claim for damages arising out of the accident.
I am satisfied the claimant was willing to accept the proposed settlement and her decision to accept it was of her own volition.
I am satisfied the claimant is aware that from the proceeds a sum of $41,976.21 will be deducted as prepaid statutory benefits.
Accordingly, pursuant to s 6.23(2)(b) of the MAI Act I approve the settlement of the claimant’s claim for damages.
Legislation
In making my decision I have considered the following legislation and guidelines:
· MAI Act;
· Motor Accident Injuries Regulation 2017, Personal Injury Commission Regulation 2020, Motor Accidents and Workers Compensation Legislation Amendment Regulation 2020, and
· Motor Accident Guidelines 2017/Personal Injury Commission Rules 2021.
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