Watmore v AAI Limited t/as GIO
[2022] NSWPIC 461
•16 August 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | Watmore v AAI Limited t/as GIO [2022] NSWPIC 461 |
| Claimant: | Thomas Watmore |
| insurer: | AAI Limited trading as GIO |
| Member: | Susan McTegg |
| DATE OF DECISION: | 16 August 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Settlement approval; economic loss; femoroacetabular impingement; torn anterosuperior labrum; approval of settlement; section 6.23 of the Motor Accident Injuries Act 2017; liability admitted; self-employed construction landscaper; 24 years of age; femoroacetabular impingement with a torn anterosuperior labrum; three weeks off work; minimal treatment; no opinion as to future prognosis; possibility of arthritis; past and future economic loss only; Held — settlement approved in the sum of $27,366. |
| determinations made: | Issued under s 6.23 of the Motor Accident Injuries Act 2017 1. This proposed settlement is approved. 2. The proposed settlement is approved under s 6.23(2)(b) of the Motor Accident Injuries Act 2017 (the MAI Act). 3. The proposed settlement complies with clause 7.37 of the Motor Accident Guidelines |
INTRODUCTION
On 10 August 2018 Mr Thomas Watmore (the claimant) was the driver of a Hino truck that was hit by a car travelling on the incorrect side of the road (the accident). As a result, Mr Watmore sustained injury.
The claimant has made a common law claim against AAI Limited trading as GIO (the insurer) the insurer of the at fault vehicle, for lump sum damages.
The insurer accepted liability for the claimant’s claim for statutory benefits and has paid statutory benefits to, or on behalf of the claimant.
The insurer has accepted that the claimant had non-minor injuries.
The claimant and the insurer have agreed to settle the claim for lump sum damages for the sum of $27,366. The insurer will be entitled to credit in the sum of $1,514.64 in respect of statutory benefits already paid to the claimant leaving the claimant with a balance of $24,851.36.
The offer is calculated as follows:
· Past economic loss $7,366
· Future economic loss $20,000
No allowance has been made for non-economic loss where the claimant has not been able to establish that he has sustained a whole person impairment (WPI) greater than 10%.
The allowance for past economic loss is calculated as follows:
· past loss of wages (3 weeks x $1,994) $5,982;
· income tax payments paid on statutory benefits $ 711, and
· superannuation calculated at 11.25% $ 673.
The amount allowed by way of buffer for future economic loss is the sum of $20,000 inclusive of superannuation.
Because the claimant is not represented by a lawyer, his settlement must be approved in accordance with the Motor Accident Injuries Act 2017 (the MAI Act).
The insurer lodged the application for approval of the settlement, and it was referred to me for consideration. I held a teleconference on 16 August 2022. The claimant participated in person accompanied by his mother Ms Lisa Watmore. The insurer was represented by Mr Ian Izzard.
JURISDICTION
The Personal Injury Commission (the Commission) was established on 1 March 2021 and the Dispute Resolution Service was abolished by cl 3 of Part 2, Division 2, Schedule 1 to the Personal Injury Commission Act 2020.
I am a Member of the Motor Accidents Division of the Commission. Clause 14A (1) of the Personal Injury Commission Regulation 2020 designates the application “pre-establishment proceedings” and cl 14D empowers me to determine those proceedings.
Because of the date of the accident cl 14D(3)(b) provides that the MAI Act and the Motor Accident Guidelines (the Guidelines) continue to apply.
DOCUMENTS REVIEWED
In considering this application for approval I reviewed the following documents:
· insurer’s submissions dated 7 September 2021:
· insurers submissions dated 18 July 2022;
· Application for personal injury benefits dated 2 September 2018;
· Application for Damages under Common Law dated 11 August 2021;
· report of the NSW Police Service;
· medical certificate of Dr Thomas Yu dated 25 September 2018;
· MRI of the left hip and X-ray of the orbits dated 17 August 2018;
· referral letter to Dubbo Base Hospital Fracture Clinic dated 31 August 2018;
· referral letter from Dr Bin Mo to Mr Peter Farmer dated 5 December 2018;
· Liability Notice – claim for damages dated 19 January 2022;
· correspondence from Slater & Gordon dated 5 May 2022;
· settlement offer from insurer dated 31 May 2022;
· list of statutory weekly payments dated 18 July 2022;
· profit and Loss statement for financial year 2017-2018;
· various email communications between the claimant and the insurer, and
· Draft Agreement for Release.
THE RELEVANT LAW
Section 6.23(1) of the MAI Act provides a claim for damages cannot be settled within two years after the accident unless the degree of permanent impairment of the injured person caused by the accident is greater than 10%.
Section 6.23(2) and (3) of the MAI Act requires approval of the settlement and I am not to approve the settlement unless I am satisfied it complies with any of the requirements of the MAI Act or the Guidelines.
Clause 7.37 of the Guidelines states I must be satisfied as to the following:
“(a) the proposed settlement satisfies the timing requirements in s 6.23(1) of the MAI Act;
(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 a claims assessor, 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;
(c) the claimant understands that they are entitled to be represented in respect of the claim by an Australian legal practitioner; and
(d) the claimant understands the nature and effect of the proposed settlement and is willing to accept the proposed settlement.”
REVIEW OF THE EVIDENCE
The claimant is now 24 years of age, and he was 20 years of age at the time of the accident.
The claimant was self-employed as a construction landscaper at the time of the accident.
The claimant was represented by Slater & Gordon Lawyers. On 5 May 2022 Slater & Gordon confirmed they no longer acted for the claimant and did not make any claim for payment of legal costs.
The claimant has not received any Centrelink benefits.
In the financial year preceding the motor accident, the claimant’s business generated sales of $184,568.50 and a gross profit of $106,335.03. The insurer suggests the claimant earnt approximately $1,994 net per week at the time of the accident.
The insurer understood following the accident, the claimant was absent from work for 21 days, although he continued to supervise his apprentice. Thereafter, the claimant resumed his pre-accident work.
The claimant received payment of statutory weekly payments of $1,514.64 for the period 4 October 2018 to 23 October 2018 which includes $711 paid to the Australian Taxation Office by way of income tax.
It is apparent from the communication with the insurer that there was frustration expressed by the claimant with the claims process. The claimant’s mother Lisa Watmore assisted in the provision of documents. On several occasions Mr Watmore referred to the failure of the insurer’s representative to respond promptly and a request was made for the claim to be transferred to another claims advisor. However, the records also suggest Mr Watmore did not provide proof of income material to verify his pre-accident weekly earnings, nor did he provide medical certificates.
The medical evidence
Following the accident on 10 August 2018 the claimant attended Wyoming Medical and Dental Health Clinic where he saw Dr Thomas Yu who referred him for an MRI scan.
Mr Watmore underwent an MRI of the left hip and an X-ray of the orbits on 17 August 2018. The MRI demonstrated features of femoroacetabular impingement with a torn anterosuperior labrum. The X-ray of the orbits failed to note any radiopaque foreign body. He also underwent an MRI of the lumbar spine which Dr Ediriweera reported showed degenerative changes.
On 31 August 2018 Dr Ediriweera referred Mr Watmore to the Orthopaedic Clinic at Dubbo Base Hospital noting he was still complaining of pain to both groins and to the right thigh.
In a Medical Certificate dated 25 September 2018 Dr Yu diagnosed a femoroacetabular impingement with a torn anterosuperior labrum.
On 5 December 2018 Dr Bin Mo referred Mr Watmore to Mr Peter Farmer, physiotherapist.
Teleconference
Mr Watmore informed me he did not attend the Orthopaedic Clinic at Dubbo Base Hospital, he returned to the Central Coast and sought treatment there.
Mr Watmore saw Mr Farmer on three occasions and paid for that treatment himself. Mr Izzard informed Mr Watmore that if he was to send the receipts or proof of payment to the insurer he would be reimbursed for those expenses.
Mr Watmore informed me he had no further treatment. He followed the recommended exercises to strengthen the hip area. He said it is not 100% and is a weak spot. However, he has returned to full time employment.
Mr Watmore informed me he did not wish to see any further doctors and was not interested in seeing a doctor for the purposes of obtaining an assessment as to his injury and the long term likely impact of his injury. He understood he may develop arthritis as a result of the injury.
I informed Mr Watmore that his right to have his reasonable and necessary treatment expenses was ongoing, although after five years the claim will be handled by the Lifetime Care and Support Scheme. I reiterated that the settlement only extinguished his rights in relation to wage loss and non-economic loss, not his treatment expenses.
I discussed with Mr Watmore the allowance for past economic loss. He informed me he was off work full time for about three weeks, and he then worked on and off for another three weeks. He said he found it necessary to not only supervise his apprentice during this time but to use the services of sub-contractors. He said he no longer had access to any records showing payments to sub-contractors. Mr Watmore subsequently became bankrupt, not because of an inability to work due to his injury, but because of the loss of his truck as a result of the accident, difficulties keeping staff and the impact of COVID 19. I explained it was difficult for the insurer to consider a claim for replacement labour in the absence of records. Mr Watmore has now recommenced business as a construction landscaper.
Mr Watmore understood the calculation of past economic loss and the basis of the allowance for future economic loss.
He was previously represented by Slater & Gordon Lawyers but informed me he did not wish to seek further legal advice about his claim or this settlement.
Mr Watmore also confirmed he had not received any benefits from Centrelink.
Mr Watmore confirmed he sought approval of the settlement and understood he would receive the sum of $25,851.36 from the settlement.
SHOULD I APPROVE THE SETTLEMENT
I am satisfied the allowance for past economic loss having regard to the available evidence and I am satisfied Mr Watmore understands how that allowance for past economic loss was calculated.
The insurer has allowed a buffer of $20,000 inclusive of superannuation benefits for the future impairment of the claimant’s earning capacity.
I understand there is the possibility Mr Watmore could develop arthritis as a result of the injury. He is currently only 24 years of age with a working life of 43 years.
In the absence of any clear evidence as to the future prognosis of the claimant’s injury and noting his reluctance to obtain further medical evidence I consider the allowance of $20,000 inclusive of loss of superannuation benefits to be appropriate.
Mr Watmore informed me that he understood that settlement of his claim for damages meant that he could not revisit the claim for non-economic loss or economic loss at a future date if his condition deteriorates or impacts his future earning capacity.
I am satisfied that the claimant is aware of his right to have his reasonable and necessary treatment expenses paid for the remainder of his life as a member of the Lifetime Care and Support scheme.
Mr Izzard confirmed that the insurer did not propose to make any deduction from the settlement for payment to Medicare where it did not include any allowance for treatment expenses. However, he also agreed the insurer would be responsible for payment of any reasonable and necessary treatment expenses paid by Medicare and causally related to the accident in the unlikely event a charge is raised.
I am of the view that the sum of $27,366 is within the range of likely potential damages assessments if the claim was to proceed to assessment taking into account the nature and extent of the claim, the injuries, disabilities, impairments and losses sustained by the claim.
I confirm the sum of $1,514.64 will be deducted from the settlement sum in respect of statutory benefits previously paid to the claimant.
Mr Watmore was aware that he would receive the sum of $25,851.36 out of this settlement.
CONCLUSION
I find the timing requirements of s 6.23(1) of the MAI Act satisfied where it is more than two years since the accident.
I am satisfied the proposed settlement is just, fair and reasonable and within the range of likely potential damages assessments if the claim was to proceed to assessment 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 is aware he can seek legal advice but does not wish to do so.
I am satisfied the claimant understands the binding nature of the settlement and that he will be precluded from making a further claim for damages arising out of the accident.
I am satisfied the claimant is willing to accept the proposed settlement.Accordingly, pursuant to s 6.23(2(b) of the MAI Act I approve the settlement of this claim for damages.
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