AB v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT Decision No. 177 1967 HELD AT WELLINGTON IN THE MATTER of The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an Appeal pursuant to Section 91 of the Act BETWEEN AB Appellant (Appeal No. DCA 207/96) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 19th day of May 1996 NAME OF APPELLANT NOT TO BE PUBLISHED APPEARANCES E P Peters for appellant A R Davie for respondent DECISION OF JUDGE D A ONGLEY This appeal concerns the effect of a election notice under s 147(3) of the Accident Rehabilitation and Compensation Insurance Act 1992 in respect of a lump sum payment for a claim that was not specified in the notice. The appellant who is now aged 35, suffered sexual abuse by her older brother over a period of time from as early as 1977. She described a rape when she was 18, also involving her brother, but that being a specific assault for which a separate compensation claim could have been maintained. The appellant was so troubled by the effects of the abuse that she did not disclose it until an occasion at about Easter 1992 when she was being attended by a doctor for severe spinal pain suffered in an accident in 1991 which was quite separate from the sexual abuse. After making the disclosure, the appellant undertook a period of counselling sessions in 1992 but she did not complete the Corporation's standard M46 form which usually initiates the opening of a paper file. There is no record of a claim against the Corporation by the doctor for medical fees, but the Corporation located a record of counselling payments beginning on 10 September 1992. The appellant had lodged an accident compensation claim in respect of her 1991 back injury and she had received payments under that claim. At the time of the commencement of the 1992 Act, the Corporation advertised the requirement for all applications and elections for lump sum compensation payments to be made before 1 April 1993 and it sent out election forms by post to claimants who could qualify for lump sum payments after repeal of the Accident Compensation Act 1982. The Corporation had created a file in respect of the back injury claim but not in respect of the sexual abuse claim. The appellant did receive a blank election form in the post. It appears likely that the form was sent to her because the Corporation had a file relating to her back injury claim. The appellant was also aware of that claim. She filled in the lump sum election form but she did not specify to which claim the form was intended to relate. She dated the form 11 February 1992, but it is common ground that she wrote down the year wrongly and she meant 1993. The form was received by the Corporation on 12 February 1993 in time to qualify as a valid election of lump sum compensation. The Corporation connected the election form with the only file that it had open, that is to say the file relating to the back injury claim. Lump sum compensation for that claim was duly processed and a payment was made to the appellant. The appellant signed an M46 form of claim for cover and treatment expenses on 28 June 1993 and the Corporation received the claim on 1 June 1993. The injury was not described, but was simply referred to as "sensitive claim" and the date of injury was given as 1966. On 10 June 1993 Corporation staff recorded a note of an enquiry about the abuse claim. From the note, it appears that the enquiry was made by the appellant's counsellor. The appellant wrote on 15 June 1993. The terms of that letter were later considered to be highly relevant to a decision whether the election form could be regarded as having any connection with the sexual abuse claim. It is set out in full: "I recently put in a claim because I have been a victim of sexual abuse. I rung up to inquiry what sort of payout I would receive and I was told if I was lucky about $4 a week. The reason I never put in a claim earlier was I was under the impression you had to go to Court to receive the lump sum payout. Since the offenders were my brother and the Mongrel Mob I obviously could not do this I personally believe people that have suffered sexual abuse have a 100% disability especially when it has occurred about nine times as is the case with me. I have had various nervous breakdowns as a result of these rapes and have been addicted to valium for the last ten years to try and blot this out. Also I have never been able to have a normal sexual relationship with a man. These memories and nightmares will haunt me for the rest of my life and I think sufferers of rape and child abuse should definitely be given the $10,000 pain and suffering payout (even paid out weekly) as these innocent people have to suffer a lifetime of hell." The Corporation replied on 17 June 1993 that the claim did not qualify for lump sum payment. No specific reference was made to the election form, probably because Corporation staff did not even suspect that the form which the appellant had sent in had anything to do with the abuse claim. The appellant's solicitor then followed up her enquiry and the Corporation asked for full information about the sexual abuse claim. The counsellor did not provide a report until August 1993 in which she referred to sexual abuse by the claimant's brother from four to five years of age, a rape by three gang members when she was 18, and a rape by the father of her child in 1985 when she would have been aged 23. The claim was accepted in September 1993 by a letter which did not specify whether the acceptance related to the single claim contained in the M46 form, or to the three or more possible claims to which the counsellor referred. The possibility that the appellant had advanced multiple claims has not been argued on this appeal. It proceeded on the basis that there was one claim, consistent with the claim for cover dated 28 May 1993. That seems to be the correct position. The Corporation wrote to the appellant's solicitors on 3 April 1995 confirming that a claim was lodged on 27 February 1992 but declining lump sum compensation because no election notice was received by 31 March 1993. There is a computer record of a claim lodged on 27 February 1992 but there is no corresponding document on the file. The date is earlier that the commencement of counselling on 10 September 1992. The source of the computer record seems to be unknown and it is not directly relevant to the issues in this appeal. The Corporation has not argued that there was no valid claim in respect of personal injury by sexual assault lodged before 1 October 1992. The point which the appellant makes is that the Corporation had two active claims for which a lump sum election could have been made. When the Corporation received the form of election in February 1993 it could have been connected with either of the claims, but was connected with the back injury claim only because that was more obvious to Corporation staff who were able to locate a paper file. The effect of the notice in terms of the statutory scheme should not be regulated by an accident of internal administration. It has not been argued, in this appeal, that the election notice should be allocated to claims in order of lodgement of claims for cover or in order of dates of accident. Either it applied to both the claims or neither of them. It is arguable that it applied to neither of the claims because it did not contain any indication to identify a particular claim. But the Corporation did not reject it. The appellant's communication to the Corporation purported to be an election, and the Corporation received the document without disputing that it was an election. In fact, the respondent still acknowledges that it is an election, but insists that it was an election connected with the claim to which Corporation staff allocated it. That is as much as to say that the Corporation had a power to complete the election by deciding what claim it related to. But it could not be right that the Corporation could complete the election. It might, on the other hand, have contacted the appellant and asked for clarification. The appellant might have told the Corporation, as she now does, that it related to both claims. What - 4 - is the effect in the present case where the Corporation did not question the election and the appellant did not inform the Corporation which claim it related to? The effective words on the form are "I hereby wish to elect my entitlement to be paid as - lump sum". The wording there applied to the appellant's entitlement. Globally, her entitlement included an entitlement to assessment of lump sum compensation in relation to two claims. There is no material before the Court to indicate whether the back injury claim had been advanced to such a stage that her entitlement to that claim was available in priority to her sexual abuse claim. Her "entitlement" was capable of referring to all her various lump sum entitlements or to only one. It has been accepted in other decisions on appeal that a single notice may apply to more than one claim. In any individual case a decision in relation to an election must depend on the nature of the notice, its content and the circumstances in which it is lodged. The Corporation's initial evaluation of the difficulty was conveyed in a letter of 30 June 1995 to the appellant's solicitors as follows "I refer to your faxed letter of 29 June 1995 with attached election notice. You queried if the election notice is acceptable in relation to Ms Ball's sensitive issue claim. Unfortunately this election notice relates to claim number 79/92/436059, a claim lodged for back strain in 1992. Election notices are not generalised across all claims a person may have lodged unless the election notice specifically states the claim numbers or something to the effect that the claimant wishes the notice to be applied to all current claims. As you can see this does not apply in Ms Ball's case and in fact her sexual abuse claim was lodged after her claim for back strain. This decision carries with it the usual review rights which must be lodged within one month of the date of this letter. The copy of this notice is useful however in that it indicates that Ms Ball was aware of this requirement in February 1992. I trust this finally clarifies the situation in regards this claim." The solicitors then applied for a review. In a letter of 20 September 1995 Mr Peters wrote to the Corporation clarifying the appellant's mistake in dating the form with the year "1992" and pointing out the consequent error in assuming that she was aware of the requirement in February 1992. He also questioned the Corporation's groundless assumption that the election referred to another claim and submitted that it was not tenable for the Corporation to assert that the appellant, knowing full well that she had various claims with the Corporation, would wish to claim lump sum compensation in respect of one claim but not in respect of others. The Corporation then responded by letter of 28 September 1995 as follows: "Election notices can be specific to a claim or broad banded across several claims but it has been the Corporation's policy that if claim numbers are not specified on the notice then the notice does not apply to more than the claim against which it was lodged. We note your client's election notice was never fully completed at the date of lodgement, she entered neither her name or claim number, however she did sign it. - 5- The Corporation accepts she made an error in the date and that the notice was lodged in February 1993, after the lodgement of her sexual abuse claim. However, this does not alter the fact that no claim number or numbers were noted and the Corporation's view is that this election notice was lodged in relation to the back injury claim only." Before the review hearing, the Corporation looked again at its decision and confirmed it in a more detailed letter from the National Units Manager to Mr Peters on 19 February 1996. Mr Peters then made extensive written submissions. The Review Officer concluded that the election notice was ineffective because it did not specify a claim. He said that the Corporation accepted it as being an election notice for her back injury. He said that he found her letter of 15 June 1997 particularly relevant as an indication that the claimant had admitted that she had not lodged a lump sum claim in relation to the sensitive issue claim before the time expired, hence the election related only to her sensitive issue claim. The Review Officer's decision followed reasoning similar to the opinion of the National Units manager in the letter of 19 February 1996 which also relied heavily on the appellants letter of 15 June 1997. I accept Mr Peters submission that the letter did not convey any clear acknowledgement that the appellant had not put in a claim before May 1993 for the following reasons: 1. The Corporation had already accepted that she had put in a claim in February 1992, although there was no claim document on her file. 2. The reference to having recently put in a claim did not refer specifically to May 1993 and could well have been intended to refer to the recent time of her claim in 1992 by comparison with the beginning of the abuse which was in 1966, and 3. The statement in her letter about the reasons why she never put in a claim earlier could well have meant that she had not put in a claim during a long period of years when she was discouraged by a belief that she would have to give evidence in a Court. It is likely that the appellant had only a rudimentary understanding of the claims processes. She knew the Corporation regarded her as being too late in some respect and the letter was a rather vague attempt at justification as well as an expression of indignation. It is quite unfair to analyse in the same way as a formal document. The claimant's own intention can be of only limited relevance if it was not communicated to the Corporation. There may well be an argument, as the respondent contended, that an intention not to make an election in relation to a particular claim could prevent an election being connected with that claim. In any case the June letter does not clearly evince such an intention. The appellant told the Review Officer that she intended the election notice to relate to both claims. The letter does not clearly contradict that evidence and it should be accepted. I return to consider the difficulty that the claimant's intention was not declared to the Corporation in any way other than by the filing of the single notice of election. If it is regarded as a global form of election there would be an unfortunate but logical - 6- consequence that claimants would have been better advised to avoid specifying particular claims when making elections. A notice with statutory effect must be expected at least to have enough particularisation to avoid uncertainty. If a non- specific notice could have the effect of an election, a claimant could find her rights determined in a manner that was not intended. On the other hand, the Corporation scrutinised election notices and could have declined to accept a notice or asked for particulars in case of doubt. It would not really be likely that claimants would think to benefit by sending in non-specific forms. The relevant parts of s 147 are as follows: 147. Compensation for non-economic loss - (1) Where any person had an entitlement to compensation under ... section 78 or section 79 of the Accident Compensation Act 1982 but has not received that compensation and makes written application for that compensation before the Ist day of April 1993, that person shall be entitled to payment ..... (2) Where any person has suffered personal injury by accident to which the Accident Compensation Act 1972 or the Accident Compensation Act 1982 applies, and - (a) That person has an entitlement to compensation under ... section 78 or section 79 of the Accident Compensation Act 1982 in respect of that personal injury, but has not received any payment under any of those sections in respect of that personal injury; and (b) That person would have an entitlement to an independence allowance under this Act if the personal injury had been suffered on the Ist day of July 1992 - that person shall be entitled to elect in writing, not later than the 3 1st day of March 1993, to receive either his or her entitlement under section 119 or section 120 of the Accident Compensation Act 1972 or section 78 or section 79 of the Accident Compensation Act 1982, or an independence allowance under and subject to the conditions of this Act, but not both. Subsection (3) deems an election to have been made in favour of an independence allowance in default of another election. It is therefore imperative to make a written election under s 147(2) to avoid a deemed election of an independence allowance. By its very nature, a written election may amount to a written application for compensation. The requirement of s 147(1), to make written application for lump sum compensation, does not appear to envisage anything that is not implicit in a written statement electing to receive it in preference to an independence allowance. That view of the section does not render s 147(1) redundant, because a claimant could conceivably apply for lump sum compensation but defer making an election. That course was quite likely to occur in relation to many claims where a claim for cover was made before the new Act came into force. On the other hand, a claimant could hardly make an election to receive lump sum compensation without at the same time declaring, by implication, a wish to receive that compensation. For those reasons, I do not think that the present claim is able to be rejected just because there was no separate claim in writing for lump sum compensation. The problem of judging the meaning and purpose of the written notice presents the same difficulty whether it is considered as an election notice or a written application. The question of its lack of information remains central. A significant feature of this case is that the notice was accepted by the Corporation when it was received by the Porirua branch on 12 February 1993. Corporation staff did not question it or return it for clarification during the period of six weeks before the end of March. Clearly it was intended as an election and it was received as an election. The subject matter of the election was referred to by the words on the form: "I hereby wish to elect my entitlement to be paid as: Lump sum" "My entitlement" could be read as referring to a general entitlement, referring to entitlement over more than one claim, that is to say an entitlement in respect of any claims. It would have been otherwise if the claimant had limited the meaning by inserting a particular claim number. Through misunderstanding this notice was lodged and received without a proper attempt to ascertain whether it was limited to a particular claim. It was capable of conveying an intention to elect lump sum compensation instead of an independence allowance in respect of all claims. If it was considered, at the time it was received, on the basis that the claimant had two claims, both of which qualified for lump sum compensation, and if it was known that she submitted only one election form, then the reasonable view would have been that the form should be taken as covering two claims. If the Corporation was not prepared to accept the form as relating to any claims under which the claimant was entitled to lump sum compensation, then the form should not have be accepted without further enquiry. It is crucial to the appellant's claim that the form was in fact accepted by the Corporation. No enquiry was made because the Corporation staff member, understandably, was aware of only one claim and made an assumption. In its corporate activity, for some purposes the Corporation must be assumed to have knowledge of all matters which are, or should be, contained in its records. The circumstances of the receipt of this election have to be regarded not on the basis of what one staff member understood, but on the basis of the knowledge attributable to the Corporation. So in these circumstances, the act of one staff member could have unintended consequences I find that the proper view of the election form, in the circumstances as they are now known, is that it was lodged and received in respect of all claims where entitlement to lump sum compensation existed. Furthermore, the form itself consists of an election and an implicit application for lump sum payment. It could not possibly be regarded as an election to receive lump compensation for which a written application might later be made. If the Corporation had rejected it, then the result could have been different. But, through error or assumption, the Corporation did not reject the election. It must therefore be taken to have accepted the appellant's election to receive lump sum compensation in respect of any claim which qualified for such an election. At the same time, the election left no doubt that the appellant wished to claim lump sum compensation in respect of any claim which qualified, and the form, meager as it was, conveyed that desire. If the form of the application was stipulated by the Act, the appellant would no doubt have little chance of succeeding. But where - 8. the only statutory requirement is that the application and election must be in writing, it is a question of the meaning and intent of the writing. In the absence of evidence that the appellant did not know she had two active claims, the only sensible construction of the writing is that she intended it to relate to all of her claims. For those reasons the appeal is allowed and the appellant is entitled to assessment of lump sum compensation in respect of her claim of 27 February 1992 for compensation for sexual abuse. The appellant will have costs of $800. DATED at WELLINGTON this 26 day of August 1997 D A Ongley District Court Judge