J v Accident Compensation Corporation
[2017] NZCA 441
•9 October 2017 at 9.30 am
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IN THE COURT OF APPEAL OF NEW ZEALAND
CA616/2016 [2017] NZCA 441
BETWEEN J
Appellant
AND
ACCIDENT COMPENSATION CORPORATION
Respondent
Hearing: 14 June 2017 Court:
Kós P, Cooper and Asher JJ
Counsel:
A C Beck for Appellant
A S Butler and M W McMenamin for RespondentJudgment:
9 October 2017 at 9.30 am
JUDGMENT OF THE COURT
A The appeal is dismissed.
B There is no order for costs.
REASONS
Cooper and Asher JJ [1] Kós P (dissenting) [50]
J v ACCIDENT COMPENSATION CORPORATION [2017] NZCA 441 [9 October 2017]
COOPER AND ASHER JJ
(Given by Asher J)
[1] This case concerns the limits to the entitlements provided by the Accident Compensation Act 2001 (the Act). The appellant, Ms J, became pregnant following a failed sterilisation. There has been no question in these proceedings about cover under the Act for her pregnancy, childbirth and physical recovery from childbirth. The Accident Compensation Corporation (ACC) has however refused Ms J’s claim for weekly loss of earnings compensation for having to stay at home after her recovery to care for her child. It takes the position that entitlements end when the physical consequences of childbirth to the mind and body are fully healed. The question in this appeal is whether that refusal by ACC was correct.
[2] We record that the practical reality of the situation is that the issue is not a choice between government support for Ms J or no support at all. Ms J has indeed been receiving weekly compensation from Work and Income New Zealand (WINZ) as a solo mother. However, as is often the case when issues of ACC coverage arise, if she qualifies for loss of earnings compensation under the Act, that compensation will be considerably greater than that which is available from WINZ.
Background
[3] We set out the background facts, which are uncontroversial, drawing them from the summary in the High Court judgment.1
[4] On 23 April 1998, Ms J underwent a sterilisation operation. That sterilisation operation failed because clips that should have been attached to the fallopian tube were instead attached to the bladder wall reflection. On 6 April 2006, Ms J became aware that she was pregnant. Her child was born in early June 2006.
[5] Ms J’s original claim for cover for the pregnancy following the failed
sterilisation was declined by ACC on 18 August 2006. That decision was quashed
1 Accident Compensation Corporation v J [2016] NZHC 1683 at [2]. This summary was recorded as being taken from the submissions of counsel for ACC.
on review on 20 December 2007. ACC’s appeal was upheld in the District Court,2 in light of the then leading authority of the Court of Appeal in Accident Compensation Corporation v D, and ACC’s original decision was restored.3 However, following the decision of the Supreme Court in Allenby v H, in which it was held that there was cover under the Act for pregnancy following medical misadventure, ACC accepted Ms J’s renewed claim for cover on 31 August 2012.4
[6] Ms J was granted cover for her pregnancy. ACC has explained that this is the period which begins with conception, and includes the physiological impacts of pregnancy. It can include the physical or mental effects of the pregnancy and ends when those physical or mental effects cease to operate (usually shortly after the birth of the child). In Ms J’s case, she was granted cover for the physical effects but not the mental effects of her pregnancy.
[7] On 28 March 2013 ACC determined that Ms J was entitled to weekly compensation for the period 15 May 2006 to 27 July 2006, and paid her backdated weekly compensation for that period. Ms J was considered to be entitled to weekly compensation for that period because she was unable to work because of her pregnancy during that time. Ms J sought review of the decision to end compensation on 27 July 2006, which was dismissed on 3 September 2013. Ms J appealed.
[8] On 31 July 2015 Judge Powell in the District Court allowed Ms J’s appeal, quashed the reviewer’s decision of 3 September 2013, and set aside ACC’s decision dated 28 March 2013.5
[9] On 22 July 2016 Nation J in the High Court allowed ACC’s appeal, finding that cover was limited to the physical effects of Ms J’s pregnancy and confirming as
correct the reviewer’s decision of 3 September 2013.6
2 Accident Compensation Corporation v [J] DC Wellington 54/2010, 8 April 2010.
3 Accident Compensation Corporation v D [2008] NZCA 576 at [54].
4 Allenby v H [2012] NZSC 33, [2012] 3 NZLR 425.
5 J v Accident Compensation Corporation [2015] NZACC 222 at [19].
6 Accident Compensation Corporation v J, above n 1, at [73]–[74].
[10] On 18 November 2016 Nation J granted leave to Ms J to appeal to this Court on the following questions of law:7
(a) Would it be inconsistent with the scheme of the Act governing entitlement to weekly compensation to extend cover to a mother who is entitled to cover for her pregnancy beyond the period when she is suffering the physical effects of the pregnancy?
(b) In terms of s 103(2) of the Act, can a person be “unable” to engage in pre-injury employment on grounds other than physical or mental inability?
(c) Does the Act require that pregnancy, as an injury, stop at the birth of the child?
(d) Should s 103(2) be interpreted so as to allow a claimant to establish an inability to engage in employment because of the consequences of a pregnancy, namely the birth of a child, independent from the physical effects of the pregnancy itself?
Entitlements under the Act
[11] Section 100(1)(a) of the Act provides that a claimant who was an earner prior to his or her personal injury, and is now incapacitated under s 103(2), is entitled to weekly compensation. Section 103 of the Act provides:
103Corporation to determine incapacity of claimant who, at time of personal injury, was earner or on unpaid parental leave
(1) The Corporation must determine under this section the incapacity of—
(a) a claimant who was an earner at the time he or she suffered the personal injury:
(b) a claimant who was on unpaid parental leave at the time he or she suffered the personal injury.
(2) The question that the Corporation must determine is whether the claimant is unable, because of his or her personal injury, to engage in employment in which he or she was employed when he or she suffered the personal injury.
(3) If the answer under subsection (2) is that the claimant is unable to engage in such employment, the claimant is incapacitated for employment.
7 J v Accident Compensation Corporation [2016] NZHC 2769 at [28].
(4) The references in subsections (1) and (2) to a personal injury are references to a personal injury for which the person has cover under this Act.
(5) Subsection (4) is for the avoidance of doubt. (Emphasis added.)
[12] On the one hand, Ms J’s child was plainly a consequence of the “personal injury” of pregnancy. Because of the pregnancy, Ms J has a child, which has inhibited her ability to engage in employment. On the other, Ms J’s child is not part of the “injury” of pregnancy insofar as it has physically or mentally affected Ms J. Ms J has recovered. Is simple causation enough? If so, Ms J would be entitled to entitlements under s 103(2) because the failed sterilisation gave rise to a baby being born; but for the pregnancy, the child would not exist. Or, must the barrier that is preventing the claimant from working be part of an ongoing physical or mental injury?
Interpretive approach
[13] The approach to interpreting the Act is well-established. McGrath J stated in
Harrild v Director of Proceedings:8
[130] The policy of successive accident compensation statutes in New Zealand, including the 2001 Act, has been to provide compensation for persons suffering personal injury without requiring that they show fault to establish their entitlement. The legislative bar to suits at common law is the consequence of the universal nature of coverage under the legislation. A “generous, unniggardly interpretation” of what was personal injury by accident under earlier accident compensation legislation was seen by this Court as in keeping with that legislative policy: Accident Compensation Corporation v Mitchell [1992] 2 NZLR 436 at 438 per Richardson J. I regard that approach to interpretation as unaffected by the narrower approach to defining personal injury since the 1992 Act. …
[14] We accept Mr Beck’s submission for Ms J that there should be a generous and unniggardly approach to the interpretation of the Act. Nevertheless that approach does not displace the primacy of s 5 of the Interpretation Act 1999, which directs courts to ascertain meaning from the text of an enactment in the light of its
purpose.
8 Harrild v Director of Proceedings [2003] 3 NZLR 289 (CA).
[15] It is important to note that the Act does not purport to replicate tort law and its damages regime. While s 317(1) provides that no person may bring proceedings independently of the Act for damages arising out of personal injury (with limited exceptions), the Act “does not purport to grant to the injured person complete restitutio in integrum as that [was] understood, in the old law”.9 The Supreme Court
in Davies v Police stated:10
Consistently with the origins of the accident compensation system, the benefits provided under the system, for reasons of affordability and the public interest in providing incentives to rehabilitation, were not set to be a complete indemnity. Claimants are to receive “during their rehabilitation” compensation for loss which is “fair” rather than full. That is a central plank in the “social contract” implemented through the legislation and its predecessors.
[16] In any event, as we set out later, it is by no means clear that Ms J could successfully claim for damages in New Zealand for wages lost as a consequence of her looking after her child.
Allenby v H
[17] As we have set out, Ms J was granted cover for her pregnancy following the Supreme Court’s decision in Allenby v H.11 The Supreme Court reasoned that, given that impregnation from rape was the physical consequence of an “accident” under the accident compensation legislation and therefore a covered personal injury, it followed that impregnation following a failed sterilisation was also a personal injury (resulting from “medical misadventure”).12 Blanchard J for the majority said:13
The development of the foetus following impregnation occurs because of the medical error, just as in the case of the undetected tumour. It causes significant physical changes to the woman’s anatomy, which of course occur naturally but still cause discomfort and, at least ultimately, pain and suffering. If a disease or infection consequential on medical misadventure can be classified by the statute as a personal injury, it does not involve any greater stretching of language to similarly include a pregnancy which has the same cause.
9 A P Blair Accident Compensation in New Zealand (2nd ed, Butterworths, Wellington, 1983) at 1, quoted by this Court in Accident Compensation Corporation v Algie [2016] NZCA 120, [2016]
3 NZLR 59 at [28].
10 Davies v Police [2009] NZSC 47, [2009] 3 NZLR 189 at [18] (footnotes omitted).
11 Allenby v H, above n 4.
12 At [76].
13 At [80].
[18] Tipping J observed in relation to the bodily changes following pregnancy, that this was an injury for the purposes of the Act:14
In both cases (rape and failed sterilisation) the bodily changes which ensue qualify as personal injury. They are apt to cause a substantial degree of physical discomfort and, quite often, substantial pain and suffering. The changes produce bodily sensations which are of much greater consequence and duration than the examples given of a strain or a sprain.
[19] The judgments in Allenby, in determining there was cover, referred to the physical effects of a pregnancy on a claimant. There was no reference to entitlements being available following recovery from the physical and mental effects of pregnancy.
The scheme of the Accident Compensation Act
[20] An emphasis on the physical and mental effects of personal injury on the claimant can be seen throughout the Act. Relevantly, the Act in referring to its purpose in s 3 states:
3 Purpose
The purpose of this Act is to enhance the public good and reinforce the social contract represented by the first accident compensation scheme by providing for a fair and sustainable scheme for managing personal injury that has, as its overriding goals, minimising both the overall incidence of injury in the community, and the impact of injury on the community (including economic, social, and personal costs), through—
…
(c) ensuring that, where injuries occur, the Corporation’s primary focus should be on rehabilitation with the goal of achieving an appropriate quality of life through the provision of entitlements that restores to the maximum practicable extent a claimant’s health, independence, and participation:
(d) ensuring that, during their rehabilitation, claimants receive fair compensation for loss from injury, including fair determination of weekly compensation and, where appropriate, lump sums for permanent impairment:
…
(Emphasis added.)
14 At [88].
[21] The references to “injury”, “rehabilitation” and “permanent impairment” are suggestive of a concern with minimising the physical and mental effects of an injury. This reflects the fact that there are four categories of cover in the Act all stemming from personal injury as defined. There is personal injury from accident,15 personal injury from treatment,16 personal injury from employment-related disease or infection17 and limited cover for mental injury as defined.18
[22] “Personal injury” is defined at s 26. The section is important, because under s 103(2) the claimant must be unable to work because of “his or her personal injury”. Section 26 provides:
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 section 21; or
(da) work-related mental injury that is suffered by a person in the circumstances described in section 21B; or
(e) damage (other than wear and tear) to dentures or prostheses that replace a part of the human body.
(1A) Personal injury includes any degree of hearing loss that is 6% or more of binaural hearing loss caused by a personal injury described in section 20(2).
(1B) Personal injury does not include any degree of hearing loss caused by—
(a) a personal injury other than a personal injury described in section 20(2); or
(b) the ageing process; or
15 Accident Compensation Act 2001, s 20(2)(a) and (g).
16 Section 20(2)(b), (c), (d), (f), (h) and (i).
17 Section 20(e) and (j).
18 Sections 21, 21A, 21B, 26(1)(c)–(da) and sch 3.
(c) any other factors.
(2) Personal injury does not include personal injury caused wholly or substantially by a gradual process, disease, or infection unless it is personal injury of a kind described in section 20(2)(e) to (h).
(3) Personal injury does not include a cardiovascular or cerebrovascular episode unless it is personal injury of a kind described in section 20(2)(i) or (j).
(4) Personal injury does not include—
(a) personal injury caused wholly or substantially by the ageing process; or
(b) personal injury to teeth or dentures caused by the natural use of those teeth or dentures.
(5) For the purposes of subsection (1)(e) and to avoid doubt, prostheses
does not include hearing aids, spectacles, or contact lenses.
[23] It is significant that s 26(1)(b) refers to “physical injuries suffered by a person, including, for example, a strain or a sprain”. In s 26(1B)–(4), personal injury is stated not to include a variety of conditions including disease or infection, cardiovascular episodes and ageing. The injuries defined are of a physical or mental type, and there is nothing in the section that suggests that “personal injury” should have a wider reach.
[24] Thus the purpose provision of the Act, and the definition of personal injury, imply an emphasis on physical or mental injuries to the claimant. When it comes to pt 4 and entitlements and related matters, s 69(1) sets out the entitlements as follows:
69 Entitlements provided under this Act
(1) The entitlements provided under this Act are—
(a) rehabilitation, comprising treatment, social rehabilitation, and vocational rehabilitation:
(b) first week compensation: (c) weekly compensation:
(d) lump sum compensation for permanent impairment:
(e) funeral grants, survivors’ grants, weekly compensation for the spouse or partner, children and other dependants of a deceased claimant, and child care payments.
[25] An entitlement to weekly compensation turns on the claimant’s “incapacity” for employment.19 Section 69(1), in addition to providing for weekly compensation, refers to lump sum compensation for permanent impairment. It is relevant to note that “impairment” is defined in s 6 as something relating to “any body part, organ system, or organ function”. Consistent with the rest of the Act, the focus is on entitlements for injury suffered to the body of the claimant. The question is whether the claimant is “unable, because of her personal injury, to engage in work…”.20
[26] We accept the submission of Mr Butler for ACC that the statutory provisions relating to weekly compensation demonstrate that the scheme puts medical assessments at its centre. When determining whether a claimant is “unable, because of his or her personal injury” to engage in employment under s 103(2), ACC “must
consider an assessment undertaken by a medical practitioner or nurse practitioner”.21
Likewise, an assessment of whether a claimant is “vocationally independent”, and therefore no longer entitled to weekly compensation, involves an occupational assessment under cl 25 of sch 1 and a medical assessment under cl 28 of sch 1.22 In addition, a claimant who receives any entitlement has certain obligations including, when reasonably required to do so, providing ACC with a certificate by a registered health professional, authorising ACC to obtain medical records relevant to the claim, and undergoing a medical assessment.23 These provisions strongly suggest that the scheme is concerned with physical and mental barriers to employment.
[27] Likewise, the provisions relating to vocational rehabilitation demonstrate that the scheme is designed to facilitate rehabilitation to medically sustainable employment. If ACC determines that a claimant is likely to need vocational rehabilitation, it must prepare an individual rehabilitation plan in consultation with the claimant.24 The purpose of vocational rehabilitation is to help a claimant maintain employment, obtain employment, or regain or acquire vocational
independence.25 An assessment of a claimant’s vocational rehabilitation needs must
19 Section 100.
20 Section 105(1)–(2).
21 Section 102(2)(a).
22 Sections 108(1) and 112.
23 Section 72(1).
24 Section 75.
25 Section 80.
consist of an occupational assessment to identify the types of work that may be appropriate for the claimant, and an initial medical assessment to determine whether the types of work identified are “medically sustainable” for the claimant.26 Again, the focus is on addressing medical barriers to employment.
[28] The Act also provides that ACC is liable to provide key aspects of social rehabilitation, including child care.27 The purpose of social rehabilitation is set out in s 79: it is to assist in restoring a claimant’s independence to the maximum extent practicable. The child care is independent child care paid for and provided by ACC rather than by the claimant or anyone in their household. This is the opposite of a mother being paid to look after a child, and is another indication that the Act is
strictly focused on addressing physical and mental medical barriers to employment and does not view parental barriers to employment in the same way.
[29] Section 103(2) must be interpreted against that background.
Interpretation of s 103(2)
[30] In approaching the question of interpretation, we acknowledge the unique nature of this type of claim. The arrival of a child after a pregnancy is not an event easily compared to any other. There is no obvious analogy in the ACC provisions to the requirements of bringing up a child, and no other event referred to in the Act is comparable.
[31] Under s 103(2) the claimant must be “unable, because of his or her personal injury” to engage in the employment enjoyed by the claimant when the personal injury was suffered. The background that we have set out shows that the Act is concerned with the physical and mental effects of an injury. It follows that in s 103(2), the combination of the words “unable”, “because of” and “personal injury”, refer to an inability to work arising from something that has happened to the
claimant’s body or mind.
26 Section 89.
27 Section 81(1)(c).
[32] Most often, after the birth of a child, a woman is not able to work for a period because of her pregnancy and the childbirth itself. The claimant’s physical or mental capacity for employment is limited because of the impact of the pregnancy and birth on the body and/or mind. Once the mother is physically and mentally recovered, she will not be unable to work any more “because of” her pregnancy. She will no longer be pregnant and have no physical or mental symptoms of the pregnancy. Her inability to work will arise because of the need to provide care for the child. Ms J is not unable to work because of her personal injury. She is unable to work because she has a dependent child. This point is aptly illustrated by substituting the words “personal injury” in s 103(2) with the actual personal injury in question, in this case “pregnancy”. Ms J is not “unable, because of her pregnancy” to engage in employment. The pregnancy is complete; Ms J has recovered.
[33] As we have set out above, medical assessments are a core part of the weekly entitlements scheme. Yet the information to be derived from a medical assessment would serve no useful purpose in Ms J’s circumstances. Indeed, she herself may be in perfect health. The barrier to her returning to employment is not any ongoing personal injury to herself, but the existence of a child following her pregnancy. Nonetheless, the provisions of the Act discussed above would demand that Ms J undergo a medical examination, and the results of that examination would be a mandatory consideration for ACC in determining Ms J’s eligibility for weekly compensation under s 103(2). That state of affairs would be inefficient and nonsensical, and in our view is a further demonstration that the compensation sought by Ms J goes beyond what is contemplated by the Act.
[34] The entitlement to weekly compensation is one of five different entitlements, stated in s 69(1). The Act’s provisions dealing with rehabilitation (ss 75–96) are distinct from those dealing with weekly compensation (ss 100–106). Whether an injury is seen as healed or not healed, if there is vocational independence as determined under s 107 of the Act, a person no longer has an incapacity for employment.
[35] Mr Beck put it to us that Ms J’s position was akin to a professional footballer
losing his leg in a car accident; the wound will heal but his incapacity to play
professional football will continue. But there is a key difference. The footballer continues to suffer an injury, the loss of the leg. Ms J, in contrast, has recovered entirely from her pregnancy. Under s 103(2) the footballer would be “unable, because of his personal injury, to engage in employment in which he was employed when he suffered the personal injury”. No personal injury would so constrain Ms J.
[36] We have considered Mr Beck’s submission that the question is one of causation, and that is where the Court’s enquiry should focus. We accept that the failed sterilisation has caused Ms J’s child to come into existence, and that Ms J’s withdrawal from employment to care for the child is in that sense “caused” by the personal injury. However the Act does not state or imply that all earnings-related losses arising from a personal injury are recoverable. It is the inability to work flowing from the “injury” that is referred to in s 103(2) and, as we have set out, there is no injury stopping Ms J from working. Put differently, Ms J is prevented from working because of a consequence of her personal injury; she is not unable to work
because of the personal injury itself.28 We agree with Stephen Todd’s comment that
“[t]he statute is concerned with physical injury to the mother, not the economic
consequences of the relationship between parent and child”.29
[37] We accept that s 103(2) is broadly worded, and does not explicitly link entitlements to the physical and mental effects of an injury. We also acknowledge the need to construe the statute in a generous and unniggardly way. The wording of the statute may not lend itself quite so naturally to a personal injury such as pregnancy, which is unique. Indeed, in a scheme with as broad a coverage as the Act, it is unlikely that the provisions of the statute will work utterly congruously with every possible personal injury. The Supreme Court’s judgment in Allenby is an example of a generous interpretation overcoming such difficulties where pregnancy is concerned. However, for the reasons discussed above, we consider that the scheme of the Act relating to entitlements focuses squarely on medical barriers to employment. Bearing in mind our obligation in s 5 of the Interpretation Act to
ascertain the meaning of s 103(2) from its text in the light of its purpose, including
28 See also the discussion in Stephen Todd (ed) The Law of Torts in New Zealand (7th ed, Thomson
Reuters, Wellington, 2016) at 59–60.
29 Stephen Todd “Accidental Conception and Accident Compensation” (2012) Journal of
Professional Negligence 196 at 205.
by reference to the scheme of the Act, we feel unable to interpret s 103(2) in the manner suggested for Ms J.
[38] Mr Beck submitted that if Ms J’s claim was held not to be covered by the Act, then her common law rights must remain. He observed that the prospect of a common law claim sitting alongside claims under the Act was unattractive, and that a resurgence of common law claims should be avoided and provided a good reason for accepting that Ms J had cover. There is a statutory bar in s 317(1) prohibiting persons from bringing proceedings in New Zealand “for damages arising directly or
indirectly” out of personal injury covered by the Act.30
[39] In our view it is by no means clear that Ms J would be entitled to the equivalent of weekly compensation under the common law, assuming (without determining the issue which was not argued before us) that s 317 did not apply. In McFarlane v Tayside Health Board the House of Lords, while accepting that there could be recovery for the pain and inconvenience of pregnancy and childbirth, unanimously held that the costs of raising a child born as a result of medical
negligence were not recoverable.31 This decision was unanimously followed the
House of Lords in Rees v Darlington Memorial Hospital NHS Trust.32 A similar position has been reached in Ireland and Canada.33 In contrast, in Cattanach v Melchior it was held by a majority of four to three in the High Court of Australia that if a couple became the parents of an unintended but
healthy child following a failed sterilisation, a court could award damages against the doctor for the costs of raising and maintaining the child in certain circumstances.34 In New South Wales, South Australia and Queensland legislation
has reversed that position.35
30 Stephen Todd takes the view that claims such as that of Ms J would not be affected by s 317.
See Stephen Todd, above n 29, at 208.
31 McFarlane v Tayside Health Board [2000] 2 AC 59 (HL).
32 Rees v Darlington Memorial Hospital NHS Trust [2003] UKHL 52, [2004] 1 AC 309.
33 Byrne v Ryan [2007] IEHC 207, [2009] 4 IR 542; MY v Boutros [2002] 6 WWR 463 (ABQB);
Bevilacqua v Altenkirk 2004 BCSC 945; and Mummery v Olsson [2001] OJ No 226 (Ont Sup Ct).
34 Cattanach v Melchior [2003] HCA 38, (2003) 215 CLR 1.
35 See Civil Liability Act 2003 (Qld), ss 49A and 49B; Civil Liability Act 2002 (NSW), ss 70 –71; and Law Reform (Ipp Recommendations) Act 2004 (SA), s 58 inserting s 67 into the Civil Liability Act 1936 (SA).
[40] Although these cases concerned claims for the costs of raising a child, and were therefore broader than Ms J’s claim for weekly loss of earnings, they demonstrate the complexity of the common law in this area. The reasons given in the decisions vary significantly. However, the decisions cited reveal three broad considerations that have been taken into account in those courts. First, the law regards the arrival of a healthy child as a blessing. The costs associated with bringing up that child are regarded as outweighed by the joy and mutual love and affection that the child brings. Second, there are significant challenges associated with quantifying the cost of bringing up a child. Third, the potential scope of liability for the medical practitioner at fault is disproportionate to the duties undertaken and the extent of the negligence. There are also the practical consequences of allowing recovery. These include whether the father of the child, or a relative who takes responsibility for the child’s care, is able to claim. There is also the fact that all mothers respond differently to the responsibilities of child care, for example by utilising maternity leave or by engaging in full time work with third party care for the child during the working day.
[41] Although the overseas case law and the considerations we have just mentioned have no direct bearing on the interpretive exercise that we are asked to undertake, they are relevant insofar as they demonstrate the uncertain outcome of any claim Ms J could have at common law. We do not see the fact that there is cover available under tort law in some states of Australia as assisting the arguments for
Ms J.36 The fact that there is no recovery for such claims in most common law
jurisdictions, and the split in Australia, leaves us entirely uncertain whether the costs of raising and maintaining a child would be recoverable from a negligent health professional in New Zealand. We are therefore not convinced by the argument that Ms J should be granted cover because the Act has replaced her ability to successfully sue for damages at common law. Further, it remains possible that Ms J has a claim which is not barred by the Act.
[42] We are satisfied that what is sought by Ms J goes beyond that which is
contemplated by the Act. Importantly, we do not accept that “loss spreading” of this
36 We also note the position taken in Todd, above n 28, at 409–410 that the arguments against an award of damages for the costs of raising a child are compelling.
type is required by the aims and purposes of the scheme, or indeed that it is manifestly equitable. It is not the purpose of entitlements to compensate for all consequences that may follow an accident. The entitlements are rather to assuage income loss for the period of recovery from injury or, if the consequences are permanent, through assessment of the losses arising from that permanent impairment. Ms J’s claim steps beyond the requirement for an ongoing injury to the person. Where a claimant requires no rehabilitation and where there is no issue about the health of that claimant, the claimant is not eligible for an entitlement; to provide such entitlement would be to go further than the purposes of the Act as we have discussed.
[43] Ms J has recovered from pregnancy. She is neither physically nor mentally impaired by it. There is no medical assessment indicating that her physical or mental capacity for employment is currently limited. In these circumstances it is not possible to say that Ms J is unable to work because of the personal injury of pregnancy. We do not consider that Ms J is unable to engage in employment because of an inability arising from personal injury in the sense envisaged by s 103(2) of the Act.
Conclusion
[44] We conclude that s 103(2) does not entitle Ms J to weekly compensation for being unable to work because of her need to care for her child. Ms J has now recovered from the pregnancy. She is not injured. She requires no rehabilitation. Therefore she is not entitled to weekly compensation under s 103(2).
[45] We emphasise that our decision has nothing to do with Ms J’s personal circumstances, which we have not referred to. Ms J may be seen as deserving support but Parliament, through legislation, dictates the extent of that support from the public purse. It is our job to interpret that legislation as best we can, to give effect to Parliament’s intention. In our judgment, the cover created by the Act plainly does not extend to loss of earnings compensation when a healthy mother is bringing up a child.
[46] Thus, we agree with the decision of Nation J. Returning to the questions of law before the Court, these questions are answered as follows:
(a) Yes: it is inconsistent with the scheme of the Act governing entitlement to weekly compensation to hold that a mother, who is granted cover for her pregnancy, is entitled to weekly compensation beyond the period when she is suffering the physical or mental effects of the pregnancy.
(b)No: for the purposes of s 103(2) of the Act, a person cannot be considered to be “unable” to engage in pre-injury employment on grounds other than physical or mental inability.
…
(d)No: s 103(2) should not be interpreted so as to allow a claimant to establish an inability to engage in employment because of the consequences of a pregnancy, namely the birth of a child, independent from the physical effects of the pregnancy itself.
We do not answer (c) as no party has suggested that the physical and mental effects of pregnancy necessarily stop at the moment of the birth of a child.
Result
[47] The appeal is dismissed.
[48] The questions of law that properly arise are answered as set out at [46].
[49] Ms J is on legal aid and ACC does not seek costs. There is therefore no order for costs.
KÓS P
[50] I dissent.
[51] It is common ground that the failed sterilisation caused Ms J an injury for which she has cover under the Act. A baby is the natural consequence of the injury. The need to care for the baby is also a natural consequence of the injury. The inability of the mother to engage in her former employment, because of the need to care for the baby, may be a third natural consequence of the injury. On the evidence, that was the situation Ms J found herself in. In my view she was entitled to periodic compensation for incapacity under s 103(2) for so long as the need to care for the child precluded her return to employment.
[52] In Accident Compensation Corporation v Mitchell Richardson J observed that the proper approach to construing the Act was that it be given a “generous and unniggardly” construction.37 We endorsed that approach in Harrild v Director of Proceedings.38 The importance of this principle lies where more than one available
interpretation exists.39 If the Act is unavoidably niggardly or ungenerous, that is
that. But if a reasonable choice presents, the more generous path should be taken.
[53] The unstated premise for choosing the more generous path is that the Act not only gives, but takes away. As the Chief Justice noted in Harrild:
[19] The policy of the legislation is to provide comprehensive cover to compensate for personal injury, including mental injury which results from physical injury, in replacement of the remedies previously available under the common law. I agree with Keith and McGrath JJ that the legislative policy is not to be undermined by an ungenerous or niggardly approach to the scope of the cover provided.
In Accident Compensation Corporation v Ambros we noted that the aim of the accident compensation regime is not to assign blame but, at the broadest level of generality, to promote distributive rather than corrective justice by spreading the economic consequences of negligent conduct over the whole community and to
provide compensation for injury (regardless of fault).40 We continued:41
37 Accident Compensation Corporation v Mitchell [1992] 2 NZLR 436 (CA) at 438.
38 Harrild v Director of Proceedings, above n 8, at [19]. See also at [37] and [130].
39 Estate of Priddle v Accident Compensation Corporation CA223/05, 19 October 2006 at [57]; Harrild v Director of Proceedings, above n 8, at [131]; and Accident Compensation Corporation v Vandy [2011] 2 NZLR 131 (HC) at [24].
40 Accident Compensation Corporation v Ambros [2007] NZCA 304, [2008] 1 NZLR 340 at [25].
41 At [25].
This is often described as a social contract: in return for the loss of the right to sue for personal injury, the community shares the cost of the injury …
[54] The objective of comprehensive cover for personal injury by accident has been diminished by legislative reform over the years, creating instead an uneasy patchwork between accident compensation entitlements, social security and public health benefits, each with very different economic results.42 Yet, where cover exists, the bar against personal injury litigation remains comprehensive.43 In reckoning the terms of the social contract wrought by statute, Richardson J’s remarks remain
pertinent.
Injury
[55] Ms J suffered a personal injury for which she has cover. That is common ground.
[56] It is now recognised that pregnancy and childbirth following a failed sterilisation operation can be a “personal injury” for which there is cover under the Act.44 Forty years ago, in L v M, Cooke J doubted that could be so.45 But at a later stage in the same proceeding the Accident Compensation Commission, as it then was, accepted that pregnancy could (and there, did) constitute personal injury by accident. The mother subsequently made a claim for expenses incurred in the
maintenance of the child for the first six years of his life. The rejection of that claim by the Accident Compensation Corporation, as it then became, was upheld by Jefferies J in the High Court.46 The question was whether those expenses were “actual and reasonable expenses and proved loss necessarily and directly resulting from the injury”. After expressing scepticism at ACC’s conclusion that pregnancy and birth were an “injury” at all, Jefferies J concluded that upon the birth of a normal healthy child the injury “is entirely healed”.47 The Judge held that if the injury was
healed, there could by definition be no further expense or loss resulting from the
42 In the present case Ms J’s social security benefits were approximately 40 per cent of the accident
compensation she had obtained in the District Court but lost in the High Court.
43 Accident Compensation Act, s 317(1).
44 Section 26.
45 L v M [1979] 2 NZLR 519 (CA) at 529–530.
46 XY v Accident Compensation Corporation (1984) 4 NZAR 219 (HC).
47 At 223.
injury. While the need to make the payments resulted from events amounting to injury:48
In short, most parents would say maintenance is not an expense or loss, and the payment of maintenance for one’s child is not necessarily and directly resulting from the birth but from the state of parenthood which inevitably involves financial sacrifice.
[57] I am unable in 2017 to agree with that conclusion. It may well reflect different social conditions prevailing over thirty years ago when the judgment was delivered. But in part it seems to reflect an inference that a claim for the costs caused by the need to care for a child born in such circumstances is adventitious and inconsistent with the proper discharge of parental duties. I would draw the contrary inference. Claimants are simply maintaining that the social contract represented by the accident compensation legislation should assist them with the costs of maintaining a dependent child whose existence is the direct consequence of a personal injury for which they have cover for so long as the need to care for the
child precludes the mother’s return to work.49
[58] In 1992 there was significant legislative amendment with the Accident Rehabilitation and Compensation Insurance Act 1992 (1992 Act). The legislative history is discussed in the judgment of Blanchard J in Allenby v H.50 The
1992 Act gave cover for “personal injury … caused by an accident”, but defined “accident” in s 3 as a specific event or series of events involving the application of force external to the human body. A series of District Court decisions then held that pregnancies resulting from failed sterilisations were not personal injuries within the
1992 Act. But in Accident Compensation Corporation v D, Mallon J took a different view.51 As Mallon J put it:52
… when viewed from the perspective of the woman’s body in its pregnant state compared with its pre-pregnant state I consider the physical impacts are capable of being described as an “injury”.
48 At 224.
49 See also the discussion of Cattanach v Melchior, above n 34, at [68]–[70] of this judgment.
50 Allenby v H, above n 4, at [39]–[48].
51 Accident Compensation Corporation v D [2007] NZAR 679 (HC).
52 At [76].
The Court of Appeal reversed that decision on the basis that the 1992 Act had confined cover and that the requisite “injury” now required some harm or damage.53
William Young P dissented.
[59] Allenby v H overturned the Court of Appeal decision in Accident Compensation Corporation v D and concluded pregnancy by way of a failed sterilisation procedure did amount to a “personal injury” by way of “physical injury” within the meaning ascribed to those words in s 26 of the Act.54 Tipping J regarded it to be “self-evident” that the purpose of a sterilisation operation is a desire to avoid pregnancy.55 He had little difficulty arriving at the now trite conclusion that pregnancy by way of medical misadventure (now referred to as “treatment injury”), does amount to a “physical injury”.56 His Honour went on to say he was unpersuaded by the argument pregnancy is a “natural process” and necessary for the survival of the human species.57 A woman seeking to avoid the natural consequence of pregnancy by way of a medical procedure suffers a physical injury when those natural consequences follow medical misadventure.58 As he noted, the same answer to whether pregnancy itself was a “physical injury” had to be given where the cause was failed sterilisation as where it was rape. In each case the pregnancy was an “accident”. The consequent bodily changes associated with pregnancy were the same, and would involve substantial physical discomfort and often substantial pain and suffering.
Incapacity
[60] The question we are concerned with is that posed by s 103(2): for how long was Ms J unable, because of her personal injury, to enga ge in employment in which she was employed when she suffered the personal injury?
[61] The question is not, we may note, simply how long Ms J's personal injury continued for. The focus of the question is incapacity rather than injury.
53 Accident Compensation Corporation v D, above n 3, at [55].
54 Allenby v H, above n 4.
55 At [86].
56 At [87]–[88].
57 At [89].
58 At [89].
Conceptually these are different enquiries. Injury and incapacity are not necessarily coextensive. The body may be healed, but the incapacity may endure.59 An example was given in argument. A professional footballer is injured in a motor accident and loses his lower leg. The leg wound will eventually heal, but the incapacity to engage in his former employment will continue.
[62] Similarly, rehabilitation and injury are not necessarily coextensive. It does not follow that because an injury has healed, there is no longer a rehabilitation need. As s 3(c) makes clear, ACC’s “primary focus” is on rehabilitation:
... with the goal of achieving an appropriate quality of life through the provision of entitlements that restores to the maximum practicable extent a claimant’s health, independence and participation.
(Emphasis added.)
So the Act is not solely concerned with a claimant’s health. Entitlement depends here on incapacity, and that is a more complex question than simply whether the injury has come to an end. Often, perhaps generally, that will be so. But not necessarily, and I do not think Parliament intended to exclude the irregular event where incapacity endures beyond injury.
[63] The drafting premise of s 103(2) is not that incapacity and injury are coextensive. Had Parliament intended that, it could easily have said so. As Judge Powell noted, ACC’s position in effect reads into s 103(2) the italicised words that follow: “because of the physical effects of his or her personal injury”.60
[64] Was Ms J still incapacitated from renewing her employment “because of her personal injury” the day after she was discharged from maternity care? In my view the answer must be “yes”, as a simple matter of direct causation. Ms J was both legally and morally obliged to care for her child. She could not just ignore it and go out to work. But for her personal injury — a physical injury by way of pregnancy and childbirth in turn caused by a treatment injury — she would be able to return to work. Some injuries deduct — such as the footballer in [61] who lost his leg. Some
are neutral. Ms J’s is the unusual case of the injury that adds. For Ms J the
59 And in some contrary cases the period of incapacity may be shorter than the period of injury.
60 J v Accident Compensation Corporation, above n 5, at [14].
ever-present baby is as much an employment-incapacitating consequence of her injury as the footballer’s ever-absent leg is for him. Put another way, “but for” her pregnancy and childbirth she would have been able to engage in her employment.61
Ms J is unable to return to her previous employment “because of her personal injury”
in terms of s 103(2).
[65] The majority suggest — at [32] — that Ms J’s inability to work is because of her need to care for the baby, not because of her personal injury. They illustrate this proposition by substituting the words “personal injury” in s 103(2) with the actual personal injury here, and suggest using the word “pregnancy”. They continue:
Ms J is not “unable, because of her pregnancy” to engage in employment.
The pregnancy is complete; Ms J has recovered.
However, the personal injury here was pregnancy and childbirth. Let us substitute, then, the later of those events. Is Ms J unable because of childbirth to engage in employment? A different answer commends itself. The presence of the baby is the incontestable and permanent consequence of the injury suffered by Ms J.
[66] Here, the unusual and unfortunate circumstances of Ms J meant she could not make child care arrangements that would enable her return to work. The father of the child did not assist her. She had no one, for example a family member, who was willing or able to assist with child care. She did not have financial resources that would permit her to cease working for a time and care for her child. She could not afford to pay for child care because she could obtain work only at the lowest paid rates.
[67] It would be wrong to suggest that it is those adverse circumstances that mean Ms J is incapacitated from employment, rather than the presence of the baby (and, therefore, the injury). Ms J is no more under an obligation to make those arrangements than she would be to procure an abortion of the foetus or the adoption of the child. Many women will have the ability to make child care arrangements with family or a paid provider. The ability to make such arrangements relieves the
incapacity. The inability to make such arrangements does not cause the incapacity.
61 Accident Compensation Corporation v Ambros, above n 40, at [24].
The incapacity is a direct consequence of the injury that caused the birth of a child that needs to be cared for.62
[68] The decision of the High Court of Australia in Cattanach v Melchior is particularly relevant to this discussion for two reasons.63
[69] First, Cattanach v Melchior held that damages for the cost of raising and maintaining a child born after a negligently conducted tubal ligation procedure were recoverable from the surgeon and his employer.64 That is, such costs were clearly foreseeable losses, and they were recoverable at common law. In reaching that conclusion the High Court of Australia differed from the contrary conclusion of the House of Lords in McFarlane v Tayside Health Board.65 None of this is to say that a child is a bad thing to receive. But when careful and lawful steps have been taken to avert conception, and the negligent conduct of a medical procedure has frustrated those steps, the consequent costs of maintaining a child may very fairly be vested on the surgeon rather than the parents.
[70] Secondly, whether such a conclusion would be reached in New Zealand is uncertain. I venture to say that on the present and progressive state of this country’s law of torts, it is entirely likely that Cattanach v Melchior would be followed here.66
Because Ms J has cover for the personal injury, she is unlikely to be able to pursue a claim for compensatory damages against the surgeon.67 For Ms J, given her lack of options, the effect of that denial is acutely difficult. Despite the fact that she has suffered personal injury for which she has cover under the Act, as the result of a treatment injury, her entitlement to post-discharge assistance is set at the same
depleted domestic purposes benefit level that would apply if none of this had
62 It is for these reasons I respectfully depart from Stephen Todd’s views: above n 29, at 206.
Whether a woman is able to work does not depend on variables; the child is a constant likely to inhibit resumption of the former employment. But third party considerations may (or may not) relieve that state of affairs. Here they did not.
63 Cattanach v Melchior, above n 34. The Court split four to three, McHugh, Gummow, Kirby and
Callinan JJ being the majority and Gleeson CJ, Hayne and Haydon JJ dissenting.
64 At [92], [181] and [303].
65 McFarlane v Tayside Health Board, above n 31.
66 I note that New South Wales, Queensland and South Australia have legislated to alter the application of Cattanach v Melchior. See above n 35.
67 Accident Compensation Act, s 317(1).
happened to her and the baby was an ordinary conception for which the state assumes substantially less economic responsibility.
[71] Finally, unlike the majority I do not think the statutory requirement for medical and vocational assessment is definitive of the meaning of incapacity. Entitlement to weekly compensation depends on the claimant’s incapacity for employment and lack of vocational independence.68 Incapacity may be assessed from time to time.69 Vocational independence is determined under s 100(2)(d) and s 107. While medical practitioner reporting contributes to both assessments, and will
be determinative in most cases, I do not read these provisions as confining the issue to the claimant’s state of health. To the contrary, vocational independence involves rehabilitative analysis which, as we have seen from s 3(c), is a matter of “independence and participation” as well as health. And s 107(3) requires the claimant’s needs “and any injury-related barriers” to be considered. The issues are broader than just the claimant’s state of health as reported by a doctor.
Conclusion
[72] Ms J’s circumstances are highly unusual. The personal injury she suffered (and for which she has cover under the Act) resulted directly in continuous obligations of child care. Claimants whose cover may extend to child care are likely confined to victims of rape and patients who suffer a treatment injury on a failed sterilisation procedure. In Ms J’s case those child care obligations were, for a significant period, unrelieved by family or paid provider assistance or the child entering school, any of which would have enabled her to resume her former employment. For so long as that state of affairs continued I consider Ms J was unable to engage in her former employment because of her personal injury and is thereby entitled to weekly compensation. I would therefore have allowed Ms J’s appeal.
Solicitors:
Peter Sara, Dunedin for Appellant
Russell McVeagh, Wellington for Respondent
68 Section 100.
69 Sections 100(2) and 102.
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