Accident Compensation Corporation v Monk
[2012] NZCA 615
•20 December 2012
| IN THE COURT OF APPEAL OF NEW ZEALAND |
| CA148/2012 [2012] NZCA 615 |
| BETWEEN ACCIDENT COMPENSATION CORPORATION |
| AND STACY ANN MONK |
| Hearing: 14 November 2012 |
| Court: Arnold, French and Miller JJ |
| Counsel: C J Hlavac and M M Ahern for Appellant |
| Judgment: 20 December 2012 at 12.30 pm |
JUDGMENT OF THE COURT
A We answer the question stated as follows:
Where a person suffers mental injury because of physical injury, and the physical injury is a necessary part or ordinary consequence of treatment received by that person, the mental injury is a personal injury for which there is cover under s 20 of the Accident Compensation Act 2001.
BThe appellant is to pay the respondent’s costs as for a standard appeal on a band A basis and usual disbursements, with provision for one counsel.
____________________________________________________________________
REASONS OF THE COURT
(Given by Miller J)
Introduction
Ms Monk underwent a lumbar puncture, a procedure in which a hypodermic needle is inserted into the spine to draw off cerebrospinal fluid for testing. There was nothing untoward about the physical procedure, which was carried out at Christchurch Hospital on 27 February 2008, but she experienced severe pain during it and partial paralysis in her legs and the right side of her body immediately afterward. That trauma may have caused conversion disorder, a mental injury that leads her to experience ongoing neurological symptoms in her legs. She still suffers weakness in her right leg and poor sensation and control in her left.
The Accident Compensation Corporation (ACC) denied Ms Monk’s claim for cover, saying that she did not suffer a qualifying personal injury.
Under the Accident Compensation Act 2001, a mental injury may be covered where the person concerned suffered it because of her physical injuries. The question for us is whether the physical injury that led to the mental injury must itself be covered under the Act. The parties agree that Ms Monk’s lumbar puncture, which might be considered a physical injury, is excluded from cover, for it was a necessary part of her treatment and was carried out appropriately.
The High Court has stated the following question of law:[1]
If a person suffers mental injury because of physical injury, where the physical injury is a necessary part of or ordinary consequence of the treatment received by that person, is the mental injury a personal injury for which there is cover under s 20 of the Accident Compensation Act 2001.
The legislation
[1]Monk v Accident Compensation Corporation HC Wellington CIV-2011-485-997, 24 February 2012.
The question is one of statutory interpretation, so we turn at once to the legislation. Section 20(1) of the Accident Compensation Act 2001 provides cover for personal injuries:
20Cover for personal injury suffered in New Zealand (except mental injury caused by certain criminal acts or work-related mental injury)
(1) A person has cover for a personal injury if—
...
(b)the personal injury is any of the kinds of injuries described in section 26(1)(a) or (b) or (c) or (e); and
(c)the personal injury is described in any of the paragraphs in subsection (2).
The kinds of injuries relevantly described in s 26(1) are:
26 Personal injury
(1) Personal injury means —
(a) the death of a person; or
(b)physical injuries suffered by a person, including, for example, a strain or a sprain; or
(c)mental injury suffered by a person because of physical injuries suffered by the person; or
(d)mental injury suffered by a person in the circumstances described in s 21; or
…
(e)damage (other than wear and tear) to dentures or prostheses that replace a part of the human body.
It will be seen that personal injury includes “mental injury suffered ... because of physical injuries”. The legislation does not define “physical injury”, but “mental injury” means “a clinically significant behavioural, cognitive, or psychological dysfunction”.[2]
[2]Accident Compensation Act 2001, s 27.
The personal injuries relevantly described in s 20(2) are:
(a) personal injury caused by an accident to the person:
(b)personal injury that is treatment injury suffered by the person:
…
(d)personal injury that is a consequence of treatment given to the person for another personal injury for which the person has cover:[3]
…
[3]Neither counsel attached significance to this provision.
In addition, s 20(4) provides:
(4)A person who suffers personal injury that is mental injury in circumstances described in section 21 [cover for mental injury caused by certain criminal acts] has cover under section 21, but not under this section.
Section 25 defines “accident”. The definition excludes treatment given by or at the direction of a registered health professional, and “treatment” receives an extended definition in s 33. However, the Act does cover personal injury caused by treatment where the injury is not a necessary part or ordinary consequence of the treatment. It does so by including (in s 20(2)(b), and so in s 20(1)) a “personal injury that is a treatment injury” suffered by the person.
“Treatment injury” is defined in s 32(1):
32 Treatment injury
(1) Treatment injury means personal injury that is—
(a) suffered by a person—
(i)seeking treatment from 1 or more registered health professionals; or
(ii)receiving treatment from, or at the direction of, 1 or more registered health professionals; [and] …
…
(b) caused by treatment; and
(c)not a necessary part, or ordinary consequence, of the treatment, taking into account all the circumstances of the treatment, including—
(i)the person’s underlying health condition at the time of the treatment; and
(ii) the clinical knowledge at the time of the treatment.
Ms Monk accepts that the lumbar puncture is not a treatment injury as defined, but she claims that her mental injury is a separate personal injury which resulted from the lumbar puncture, a physical injury, and so qualifies as a treatment injury.
The decisions below
In the District Court Judge Beattie found that the lumbar puncture was done normally and there was no evidence that it caused any physical damage. Nor was there any physiological cause for the conversion disorder, which is a recognised condition and as such was capable of being a mental injury.[4] However, Ms Monk’s mental injury was not covered. The Judge reasoned that a mental injury is covered only if it resulted from a physical injury that was both separate from the treatment and not a necessary part or ordinary consequence of it.
[4]Monk v Accident Compensation Corporation [2010] NZACC 46.
A question of law was stated for the opinion of the High Court.[5] Mallon J answered it in Ms Monk’s favour.[6] We quote the relevant part of the Judge’s reasons in full:
[5]Monk v Accident Compensation Corporation [2011] NZACC 148. The question was stated a little differently from that stated before us, although nothing turns on it. The question was “whether a mental injury arising out of proper medical treatment, so that the physical injury aspect of that treatment does not constitute a treatment injury, is nevertheless a treatment injury arising as an accident out of a personal injury” (at [32]).
[6] Monk v Accident Compensation Corporation [2012] NZAR 1 (HC) at [21].
[16] The difficulty with the Corporation’s submission is that s 20 defines the requirements for cover whereas s 26 defines what constitutes a “personal injury”. The term “personal injury” is used in s 20(2) and in s 32 and, on a plain reading of those sections, this must refer back to the personal injury as defined in s 26. The sections therefore work as follows.
[17] If there are physical injuries then that is one kind of “personal injury” (as defined in s 26) that is covered (under s 20) unless some other exclusion applies. By way of example, if a person has surgery they may suffer physical injuries in that bodily harm or damage may occur (eg if the surgery involves cutting the skin and underlying tissue). Those physical injuries would qualify as a “personal injury” under s 26(1)(b) and therefore would meet the second requirement for cover (s 20(1)(b)). However they would not have cover because they would not meet the third requirement (s 20(1)(c)). That is because the physical injuries from the surgery are not an “accident” (s 20(2)(a)), and they are not “treatment injury” (s 20(2)(b)), because the physical injuries are a necessary part of the treatment (s 32(1)(c)).
[18] Another kind of “personal injury” (as defined in s 26) that meets the second requirement for cover (s 20(1)(b)) is a “mental injury suffered by a person because of physical injuries suffered by the person” (s 26(1)(c)). If a person suffers a mental injury because of surgery (which involved bodily harm or damage) then this would meet the second requirement for cover. That “personal injury” would also need to meet the third requirement for cover (s 20(1)(c)). It would meet that requirement as “personal injury that is treatment injury” (s 20(2)(b)) providing it met the definition in s 32. That definition requires there to be a “personal injury” (in this example, the mental injury suffered because of the surgery injuries) suffered by a person seeking treatment (the surgery), caused by the treatment (the surgery) and which is not a necessary part of or an ordinary consequence of the treatment (mental injury suffered because of surgery injuries is unlikely to be a necessary or ordinary consequence of the treatment).
[19] I therefore consider that the plain words of the sections do not support the submission advanced by the Corporation. I accept that the legislature intended to limit cover for mental injuries after the decision in Accident Compensation Corporation v E so that “mental injury” alone is not covered unless it meets one of the specific exceptions to this. Outside the specific exceptions, the scope of the cover is limited by:
(a)requiring that there be “physical injuries” which cause the mental injury; and
(b)the mental injury caused by physical injuries must either be caused by an accident (which in the case of physical injuries from treatment will not usually be the case unless the mental injury arises from some mistake in the treatment) or be a treatment injury (as defined).
(Footnotes omitted.)
Accordingly, the Judge held that a mental injury suffered because of physical injury can be covered as a treatment injury although the physical injury was a necessary or ordinary consequence of the treatment.
ACC’s appeal
The parties invited us to assume that the lumbar puncture was a physical injury under s 26(1)(c). ACC reserves its position on that point, and does not accept that the lumbar puncture caused Ms Monk’s present symptoms. Those matters remain to be argued if we answer the question of law in her favour.
Mr Hlavac contended that Parliament has clearly provided cover for mental injury in very particular circumstances only. Relevantly, mental injury is covered only where a physical injury causes it. Parliament cannot have intended to exclude cover for a physical injury resulting from treatment yet provide cover for the mental consequences of such treatment. So the mental and physical injury must each satisfy s 32(1): that is, they must be suffered by a person seeking treatment, must be caused by the treatment, and must not be a necessary part or ordinary consequence of the treatment.
Ms Wilson responded that while a physical injury is a prerequisite, the legislation actually covers the mental injury. The physical injury need not be separately covered. This conclusion follows from the plain language of the legislation, its principles and its object. In this case the treatment injury, conversion disorder, is covered because it was additional to and separate from the physical injury (insertion of a needle) inherent in a lumbar puncture.
Discussion
As noted above, the legislation does not define “physical injury”. However, the term has been defined judicially as bodily harm or damage having some appreciable and not wholly transitory impact on the person.[7] So the ordinary meaning of the statutory language is that any such physical injury suffices for the purposes of s 26(1)(c). That is, a mental injury may be covered although the separate physical injury from which it results is not.
[7]Allenby v H [2012] NZSC 33, [2012] 3 NZLR 425 at [56].
Further, such qualifying mental injury is a necessary but not sufficient requirement of cover. The mental injury must also be (relevantly) a treatment injury or the result of an accident. It is the mental injury, not the underlying physical injury, that must meet these express requirements.
As Mr Hlavac frankly conceded, ACC’s contrary construction requires us to read words into the legislation to limit the meaning of “physical injuries” in s 26(1)(c). He attributed the omission of these words to Parliamentary oversight, and appealed to the well-established principle that even where the statutory language seems clear its meaning should be checked against its purpose and context.[8] Counsel sought to locate this purpose in the legislative history.
[8]Commerce Commission v Fonterra Co-Operative Group Ltd [2007] NZSC 36, [2007] 3 NZLR 767 at [22].
We turn to the history. Under former legislation, the Accident Compensation Act 1982, the term “personal injury by accident” included the “physical and mental consequences of any such injury or of the accident”.[9] In Accident Compensation Corporation v E, a senior staff member in a large organisation suffered a breakdown while on a gruelling management course.[10] She had no prior history of mental illness. This Court accepted that “accident” includes the unexpected consequences of an intended activity, and further held that mental consequences might qualify as a personal injury by accident although not accompanied by any physical injury.
[9]Accident Compensation Act 1982, s 2(1) (repealed).
[10]Accident Compensation Corporation v E [1992] 2 NZLR 426 (CA).
The legislature responded by changing the definition of personal injury when passing the Accident Rehabilitation and Compensation Insurance Act 1992. That Act provided that mental injury would be covered only where it resulted from physical injury.[11] That remains the position under the 2001 Act, which admits only a few specific exceptions.[12] We readily accept that the legislative history demonstrates a clear Parliamentary intention to cover mental injury only if it arises from physical injury.[13]
[11] Accident Rehabilitation and Compensation Insurance Act 1992, s 4(1) (repealed).
[12]Sections 21(1) (mental injury resulting from certain criminal acts) and 21B (mental injury resulting from a single traumatic event at work).
[13]HarrildvDirector of Proceedings [2003] 3 NZLR 289 (CA) at [71]-[72].
However, ACC’s proposition that the physical injury that caused the mental one must itself be covered rests on an assumption that the legislature meant to undo ACC v E entirely. The record suggests otherwise. It indicates that the original amendment was intended only to limit claims for some mental injuries, notably workplace stress, which might otherwise have been made after ACC v E. In a 1991 report a Ministerial Working Party on the Accident Compensation Corporation and Incapacity stated:[14]
Stress ... is a principal cause of escalating costs of workers compensation overseas. The ACC has advised that to date it has kept stress cover out of the current scheme on the grounds that it is not a form of personal injury by accident but is a consequence of a gradual process. The ACC has also argued that stress is not an occupational disease in that the work-place is not the only source of stress. In the ACC’s view, stress is attributable to a variety of sources. The courts have in general supported this view, although some very recent decisions have breached the boundary between stress and personal injury by accident.
The Working Party has noted the ACC’s views. We have concluded that stress should not be included as part of the mandated insurance scheme and in particular not part of the work scheme. Its inclusion in the latter would seem to be inconsistent with the principle noted above.
We also recommend that physical injury should be present before mental injury is covered for essentially the same reasons. While this may give an appearance of arbitrariness, this requirement is necessary in order to avoid stress claims entering “through the back door”.
[14]Report of the Ministerial Working Party on the Accident Compensation Corporation and Incapacity (1991) at [362]–[364].
A paper by the then Minister of Labour, the Honourable Bill Birch, noted the Working Party’s recommendation and its reasoning that the physical injury requirement would prevent stress claims, and concluded that “[t]he Government supports this view”.[15]
[15]W F Birch Accident Compensation: A Fairer Scheme (Office of the Minister of Labour, Wellington, 1991) at 32.
The Law Commission report preceding the introduction of the Accident Rehabilitation and Compensation Insurance Bill did not recommend, or even discuss, restricting the scope of mental injury claims.[16] Further, the Hansard debates say little about the new definition of personal injury. When introducing the Bill, the Minister simply stated “[t]he definition of personal injury in particular will overcome the problems of boundary shifting and costs arising from a lack of appropriate definitions under the existing legislation.”[17] No direct mention was made of cover for mental injuries. The Select Committee report is also unhelpful.[18]
[16]Law Commission Personal Injury: Prevention and Recovery (NZLC R4, 1988).
[17](19 November 1991) 520 NZPD 5389.
[18]The Select Committee report is very short and simply recommends that the Bill be passed with the amendments shown. There is no discussion of the contents of the Bill.
It appears, then, that the restriction on mental injury claims must have originated with the Ministerial Working Party and been adopted in the Bill. The legislative history indicates that Parliament sought only to prevent workplace stress claims. That purpose does not indicate that the physical injury required under s 26(1)(c) must itself be covered.
Mr Hlavac next pointed to s 119, which excludes cover for self-inflicted personal injury, arguing that unless ACC’s analysis is adopted a person might claim for mental injury resulting from a self-inflicted physical injury. But ACC would presumably answer such a claim by contending that the underlying physical injury and the mental injury are both positively excluded in that case. Section 119(1)(a) excludes any personal injury – including any qualifying mental injury - that a claimant causes to be inflicted upon himself or herself.[19]
[19]DMTH v Accident Compensation Corporation [2004] NZAR 385 (HC) at [22].
Counsel highlighted what he submitted are absurd consequences should ACC’s construction not be adopted. He submitted that the legislature cannot have intended to cover mental injury resulting from a wholly trivial physical injury, such as a blood test. But as noted above, physical injury has been judicially defined to require that the injury must have some appreciable and not wholly transitory effect. Indeed, in this case ACC has reserved its position on whether a lumbar puncture is a physical injury at all. And the more trivial the physical injury, the harder it may be to show that it caused the mental one. Each case must be considered on its merits. On the record before us it would be speculative to suggest that absurd results will follow, or floodgates open, should ACC’s construction not be adopted. If such consequences do follow, it is for Parliament to make any necessary policy changes.
Finally, Mr Hlavac suggested that anomalies will result unless ACC’s construction is adopted. He used the example of a competent cancer diagnosis that turns out to be mistaken but which causes a mental illness in the meantime, such mental illness not being an ordinary consequence of the diagnosis. (A diagnosis is treatment under the legislation.) He argued that because the diagnosis in this assumed case involved no physical treatment the claimant would not be covered for the mental injury, while a claimant such as Ms Monk could claim for her mental injury because it resulted from physical treatment. But anomalies are common at the margins of the accident compensation scheme and they are seldom instructive, especially in the absence of evidence that they occur regularly in practice.[20]
Decision
[20]Accident Compensation Corporation v D [2008] NZCA 576 at [69].
A mental injury may be covered under s 26(1)(c) of the 2001 Act only if it results from a physical injury, and the mental injury must further result from an accident or qualify as a treatment injury. Like Mallon J, we are not persuaded that the ordinary meaning of the statutory language or the object of the legislation further requires that the physical injury be defined as a physical injury that is itself covered.
We accordingly answer the question posed as follows:
Where a person suffers mental injury because of physical injury, and the physical injury is a necessary part or ordinary consequence of treatment received by that person, the mental injury is a personal injury for which there is cover under s 20 of the Accident Compensation Act 2001.
ACC is to pay Ms Monk’s costs as for a standard appeal on a band A basis and usual disbursements, with provision for one counsel.
Solicitors:
Young Hunter, Christchurch for Appellant
John Miller Law, Wellington for Respondent
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