Young and Military Rehabilitation and Compensation Commission

[2012] AATA 17

Administrative Appeals Tribunal

DECISION AND REASONS FOR DECISION [2012] AATA 17

ADMINISTRATIVE APPEALS TRIBUNAL      )

)          No 2010/2919

GENERAL ADMINISTRATIVE  DIVISION		)
Re		ANTHONY YOUNG

Applicant

And MILITARY REHABILITATION AND COMPENSATION COMMISSION

Respondent

DECISION

Tribunal The Hon R J Groom AO (Deputy President)

Date16 January 2012

PlaceHobart

Decision The decision under review is affirmed.

[Sgd Hon R J Groom]

Deputy President

CATCHWORDS

COMPENSATION - claim for costs incurred in modification of vehicle - because of injury employee only able to drive automatic vehicles - purchase of automatic vehicles - whether "modification" of vehicles - decision under review affirmed

Safety Rehabilitation and Compensation Act 1988, s 39(1) and (2)

Stephenson and Comcare [2005] AATA 434

REASONS FOR DECISION

16 January 2012 The Hon R J Groom AO (Deputy President)      

INTRODUCTION

1.      This is an application by Mr Anthony Young for a review of a decision made by a Delegate of the Military Rehabilitation and Compensation Commission on 13 May 2010.

2.      In that reviewable decision the Delegate affirmed an earlier decision of 23 April 2010 refusing Mr Young’s request for compensation for the cost of the modification of three motor vehicles under section 39(1) of the Safety Rehabilitation and Compensation Act 1988 (“the Act”).

3.      Mr Young had served in the Royal Australian Air Force from 1 June 1981 until 20 November 1986.  On 10 May 1983 he made a claim for compensation in respect of Guillain Barre´ Syndrome.  Liability for this condition was accepted on 22 January 1985.  Because of medical conditions arising out of his defence service Mr Young is receiving a Special Rate of pension under the Veterans’ Entitlements Act 1986.

4.      It is not in dispute in these proceedings, and the Tribunal so finds, that because of his accepted medical impairment it is necessary for Mr Young to drive only vehicles fitted with automatic transmission. 

5.      Mr Young applied for compensation for the cost of modifying the vehicles by letter dated 26 March 2010. (T52)   Attached to that letter was correspondence from Mr Stephen Martin, General Sales Manager at Tilford Pty Ltd, specifying three vehicles Mr Young had purchased, namely a Ford Explorer purchased on 7 February 1999, a Ford Ranger purchased on 15 November 2007 and a Ford XR6 purchased on 1 February 2009.  The letter from Tilford Pty Ltd indicated that the additional total cost incurred in purchasing the three automatic vehicles rather than purchasing manual transmission vehicles was $6,000.00.  The claim by Mr Young is confined to these three vehicles and the $6,000.00 additional cost of purchasing them.

6.      At the hearing Mr Skinner, the advocate appearing for the applicant, contended that the claim related to nine vehicles purchased by Mr Young since 1997.  However both the decision of 23 April 2010 and the reconsideration decision of 13 May 2010 were concerned with the compensation claim of $6,000.00 being the costs alleged to have been incurred by Mr Young in making modifications to three vehicles only.  Therefore it is those vehicles and those costs which are the subject of this review. 

7.      Section 39(1) of the Act provides as follows:

“39  Compensation payable in respect of certain alterations etc.

(1)  Where:

(a)  an employee suffers an injury resulting in an impairment; and

(b)  the employee is undertaking, or has completed, a rehabilitation program or   has been assessed as not capable of undertaking such a program;

the relevant authority is liable to pay compensation of such amount as is reasonable in respect of the costs, payable by the employee, of:

(c)  any alteration of the employee’s place of residence or place of work;

(d)  any modifications of a vehicle or article used by the employee; or

(e)  any aids or appliances for the use of the employee, or the repair or replacement of such aids or appliances;

being alterations, modifications or aids or appliances reasonably required by the employee, having regard to the nature of the employee’s impairment and, where appropriate, the requirements of the rehabilitation program”.

THE ISSUE

8.      It is quite properly conceded by the respondent, and agreed by the Tribunal, that Mr Young satisfies sub-sections 1(a) and (b) of section 39.   Indeed the Tribunal is satisfied on the material before it that Mr Young has suffered an injury resulting in an impairment and that he has completed a rehabilitation program. 

The principal issue for determination is therefore whether the purchase of a vehicle with automatic transmission is within the meaning of the words “… modifications of a vehicle … used by the employee” in section 39(1)(d) of the Act.

If there was such a modification then there is the further question as to whether Mr Young had actually incurred additional cost in purchasing automatic rather than manual vehicles.

9.      The word “modifications” in section 39 should be given its ordinary meaning namely “the action of making changes in an object without altering the essential nature; the state of being thus changed; partial alteration”.  (Shorter Oxford Dictionary 3rd Edition).  “Partial alteration” (Macquarie Dictionary 5^th Edition).

10.     Section 39(1)(d) plainly requires that the vehicle used, or to be used, by the employee is changed or altered in some way in order to make it suitable for the use of the injured employee bearing in mind the nature of his or her impairment.

11.     Mr Martin in his oral evidence confirmed that various types of modifications can be made to vehicles including “seating modifications” and “modifications for wheelchair lifts” as well as changing “… brake pedals and accelerator pedals from side to side”.  If such alterations are reasonably required to satisfy the special needs of an employee suffering an impairment, then obviously additional costs would be incurred over and above the normal costs of purchasing the vehicle.  In the Tribunal’s view those types of modifications or alterations would clearly be “modifications” within the meaning of section 39(1)(d) of the Act.  But of course here the issue is whether the mere purchase of a vehicle manufactured with automatic transmission is a “modification” within the meaning to be given to that word as it appears in section 39(1)(d).

12.     The evidence before the Tribunal establishes that vehicles are originally manufactured by car markers principally as either automatic or manual vehicles.  In an overall sense automatic passenger vehicles are now more common than manual vehicles.  When asked what percentage of Tilford’s sales of new cars were automatic and manual Mr Martin said:  “look, today if we looked across at our entire sales across all models we would probably say 60% auto, 40% manual”.  (Transcript page 15)

13.     Automatic vehicles are therefore readily available in the market place.  In statistics issued by the Federal Chamber of Automotive Industries (Exhibit R5) of all passenger vehicles sold in Australia in 1995, 70.4% were automatic and 29.5% manual.  There is a third column (Continuous VAR.) of 5.3%.   By the year 2011 there had been little change in the statistics with automatic vehicles making up 70.5% of all passenger vehicles sales.  So automatic vehicles are in reality common fare and are readily available from manufacturers without the need for any modifications to be undertaken. 

14.     In considering whether the purchase of an automatic vehicle is a modification the Tribunal is assisted by the reasoning of Deputy President Purvis in Stephenson and Comcare [2005] AATA 434 (13 May 2005). The Tribunal in that case considered a compensation claim under section 39(1)(c) of the Act and decided that the acquisition of a new residence was not an “… alteration of the employee’s place of residence” nor was it the “modification” of “an article”.

15.     After considering all of the material before it the Tribunal concludes that the mere purchase by Mr Young of new automatic vehicles cannot be said to be a “modification” of those vehicles within the meaning of section 39(1)(d) of the Act.

16.     Although not essential to this decision the Tribunal nevertheless points out that compensation is only payable under section 39(1)(d) of the Act if an employee actually incurs additional costs as a direct result of the making of necessary modifications to a vehicle.  In this case it is not at all clear that Mr Young did in fact incur additional costs in purchasing the automatic transmission vehicles.

17.     Mr Martin said in evidence that the difference in the purchase price of an automatic vehicle over a manual was $2,000.00.  That was plainly a general indication of the cost differential which would obviously not apply in each individual case.  He also said that when an automatic car was traded in it would attract an additional return of “between $1,000.00 and $2,000.00”.  If the cost of purchase was an extra $2,000.00 but when traded in an additional $2,000.00 was received then the net cost would obviously be nil.  It could be seen that the legislature was mindful of the need to ascertain the true net cost of any modification.  (See section 39(2)(f) of the Act). 

It is also relevant that in this particular case Mr Young benefited from special deals provided by Tilford Pty Ltd.  He was able to purchase two of the three automatic vehicles, namely the Ford Ranger and the Ford XR6, below the recommended retail price of the same type of manual vehicle.  There is no direct evidence available of the actual cost of purchasing the Ford Explorer in 1999. 

There was simply insufficient evidence before the Tribunal  to satisfy it that Mr Young suffered a true net loss in purchasing the automatic transmission vehicles.

18.     As already indicated the Tribunal finds that the purchase of the new automatic vehicles was not a “modification” of those vehicles.  There was no other “modification” of the vehicles which would provide Mr Young with an entitlement to compensation under section 39(1)(d) of the Act.

DECISION

19.     The decision under review is affirmed.

I certify that the 19 preceding paragraphs are a true copy  the reasons for the decision herein of The Hon R J Groom AO (Deputy President)

Signed: R Hunt - Associate

Date/s of Hearing   10 November 2011
Date of Decision   16 January 2012
Advocate for the Applicant        David Skinner, Returned Services League  
Solicitor for the Respondent      David Wilson, Australian Government Solicitor