McKenzie v Accident Compensation Corporation

IN THE DISTRICT COURT HELD AT WELLINGTON Decision No. 135/2004 UNDER The Injury Prevention, Rehabilitation, and Compensation Act 2001 AND IN THE MATTER of an appeal pursuant to Section 149 of the Act BETWEEN ANGUS ROSS McKENZIE of Warkworth Appellant (Appeal No. AI 416/02) AND - ACCIDENT COMPENSATION CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARING at AUCKLAND on 8 April 2004 APPEARANCES/COUNSEL H. Hunt for appellant F. Becroft for respondent RESERVED JUDGMENT OF JUDGE J. CADENHEAD The Issue [1] At issue is a decision by the Accident Compensation respondent (“the Corporation”) dated 1 March 2002 declining the appellant’s request for funding to assist with retraining. https://openlawnz-my.sharepoint.com/personal/andrew_openlaw_nz/Documents/ACC Decisions (DC appeals)/2004/135- 2004.doc AE Narrative of Facts [2] The appellant has cover for a right shoulder injury sustained on 5 March 1999. The claim was not lodged until 31 May 1999 at which point the respondent considered and approved the funding for surgery to the shoulder. [3] The appellant then requested weekly compensation and provided the respondent with medical certification of incapacity. [4] On 25 January 2000 the respondent declined the appellant’s request for weekly compensation on the basis that he was not employed at the date of his accident and incapacity. [5] The appellant applied for a review of that decision on 18 March 2000. The review was heard on 26 May 2000 before Kate Lethbridge, Reviewer. Ms Lethbridge issued a decision on 2 August 2000 dismissing the appellant’s application. The reviewer found that there was no evidence of employee status beyond 3 March 1999. The reviewer made reference to a pending action before the Employment Relations Authority, by the appellant, against his former employer. [6] On 11 June 2001 the Employment Tribunal issued a decision against the appellant’s former employer awarding the appellant the equivalent of one week’s salary plus interest. [7] On 6 July 2001 the appellant forwarded a copy of that decision to the respondent and asked that his claim for compensation to be reconsidered. [8] The appellant’s file was accordingly reopened and on 17 September 2001 the respondent issued a decision indicating that the appellant was a deemed earner as at 5 March 1999, and was therefore entitled to weekly compensation. The calculation was made and compensation was backdated and paid for the period 5 March 1999 to 4 December 1999. [9] On 1 December 2001 the appellant wrote to the respondent and asked whether there was any additional assistance available to him. 135-2004 2 [10] Subsequently the respondent sent the appellant an application for an independence allowance, and a general guide to entitlements under the legislation. [11] On 28 December 2001 the appellant completed a Request for Assistance Form stating:- “I require total retraining as the industry I was formerly employed in has completely changed or been eradicated and I now have no recognisable qualification due to the time processing previous claims with ACC”. [12] On 29 January 2002 the appellant wrote to the respondent once more indicating that any retraining available would be appreciated. [13] On 5 February 2002 the respondent wrote to the appellant and advised that the respondent can only provide vocational assistance to a claimant who is entitled to weekly compensation. As the appellant was not in receipt or entitled to weekly compensation at that point in time the respondent was unable to provide vocational rehabilitation. [14] On 11 February 2002 the appellant wrote to the respondent once more stating:- “The retrospective action of payment of weekly compensation clearly establishes in law that I had coverage for the claimed injury. It is a bit rich now for the Corporation to now claim that other entitlements that also existed at the time of my injury cannot now be actioned when this situation was brought about by the Corporation’s original intransigence. I look forward to an application for vocational retraining by return post.” [15] On 1 March 2002 the respondent issued a decision reiterating that under current legislation the respondent could not provide vocational assistance to an appellant who is not entitled to weekly compensation. [16] On the same day the appellant applied for a review of the respondent’s decision. [17] The review was heard on 23 July 2002 before Mr Carter, Reviewer. Mr Carter issued a decision on 31 July 2002 dismissing the appellant’s application. [18] A notice of appeal was filed against the respondent’s decision thereafter. 135-2004 3 The Review Decision [19] The relevant reasoning of the reviewer reads as follows:- “At the hearing, Mr Hunt acknowledged that a strict interpretation of Clause 53 prevented payment of vocational rehabilitation entitlements now, because Mr McKenzie is no longer entitled to weekly compensation. However he submitted that in fairness, a strict interpretation should not be adopted. However this is not so much a case of the Corporation’s interpreting the statute strictly, as it is a matter of the statute itself not providing any discretion in Section 53 which the Corporation can exercise. Mr McKenzie is no longer certified as being unable to return to his pre-incapacity employment, and so he is no longer entitled to weekly compensation. Such an entitlement is the pre-requisite for vocational rehabilitation, and it is not met. Clause 55 states at sub-clause 1 that, in deciding whether to provide vocational rehabilitation, the insurer must have regard to the matters in Clause 56(1). These are whether the rehabilitation is likely to achieve its purpose, whether it is likely to be cost-effective, and whether it is appropriate in the circumstances. (In deciding whether it is appropriate, the insurer must consider the hierarchy in Clause 55(2). Now, three years later, it is no longer practical for the criteria in Clause 56 to be applied. There is another reason given for the Corporation’s decision, set out in the penultimate paragraph of the Corporation’s submission. This is that the need for retraining has not arisen because of Mr McKenzie’s injury, but because technological change has eliminated his trade of Photolithographer. If his trade was still available in the job market, he could return to it. The elimination of a job through technological change may not be always be a reason for declining vocational rehabilitation. For example, when an injured person is incapacitated for a long time and the change happens during that time, vocational rehabilitation may still be able to be provided. But in Mr McKenzie’s case, the technological change and consequent disappearance of his trade was under way when his incapacity began. For those three reasons, Mr McKenzie’s application for review is unsuccessful and the Corporation’s decision is confirmed.” The Law and Legal Principles [20] At the heart of this appeal is the construction to be given to the statutory regime existing at the time. As the appellant made his application for vocational assistance in late 2001 and the respondent issued a decision in respect of the matter on 1 March 2002, the relevant legislation is the 1998 Act, which was in force at that time. [21] Clauses 53-57 of Schedule 1 of the 1998 Act provide:- 135-2004 4 “53. Application of clauses 54 to 57 – Clauses 54 to 57 apply to an insured who – (a) Has suffered personal injury for which he or she has cover; and (b) Is- (i) Entitled to weekly compensation; or (ii) Likely, unless he or she has vocational rehabilitation, to be entitled to weekly compensation; or (iii) On parental leave under the Parental Leave and Employment Protection act 1987. 54. Purpose of vocational rehabilitation – The purpose of vocational rehabilitation is to help an insured to, as appropriate, - (a) Maintain employment; or (b) Obtain employment; or (c) Regain or acquire a capacity for work. 55. Hierarchy of considerations – (1) In deciding whether to provide vocational rehabilitation, the insurer must have regard to the matters in clause 56(1). (2) In deciding what vocational rehabilitation is appropriate for the insured to achieve the purpose of vocational rehabilitation under clause 54, the insurer must consider- (a) Whether it is reasonably practicable to return the insured to the same employment in which the insured was engaged, and with the employer who was employing the insured, when the insured’s incapacity commenced; and (b) If it is not, whether it is reasonably practicable to return the insured to an employment of a different kind with that employer; and (c) If it is not, whether it is reasonably practicable to return the insured to the employment in which the insured was engaged when the insured’s incapacity commenced, but with a different employer; and (d) If it is not, whether it is reasonably practicable to return the insured to a different employment with a different employer, in which the insured is able to use his or her experience, education, or training; and (e) If it is not, whether it is reasonably practicable to help the insured use as many of his or her pre-injury skills to obtain employment as possible. 56. Vocational rehabilitation: matters to which insurer to have regard – (1) In deciding whether to provide vocational rehabilitation, the insurer must have regard to- 135-2004 5 (a) Whether the vocational rehabilitation is likely to achieve its purpose; and (b) Whether the vocational rehabilitation is likely to be cost-effective having regard to the likelihood that costs of entitlements under this schedule will be reduced as a result of the provision of vocational rehabilitation; and (c) Whether the vocational rehabilitation is appropriate in the circumstances. (2) The insurer is liable to provide the vocational rehabilitation for the minimum period necessary to achieve its purpose, but is not liable to provide any vocational rehabilitation for longer than 3 years, which need not be consecutive. (3) This clause is subject to any regulations made under section 402. 57. Vocational rehabilitation may start or resume if circumstances change – (1) The insurer may, at any time, decide whether or not there has been a change of circumstances affecting the insured’s need for vocational rehabilitation. (2) If the insure decides that there has been such a change, the insurer and the insured may agree to the modification of the insured’s individual rehabilitation plan to reflect the changed circumstances. (3) An insure may resume providing vocational rehabilitation under the insured’s individual rehabilitation plan, with any agreed modifications, to an insured who- (a) Had vocational rehabilitation; and (b) As a result, obtained employment; but (c) Is unable to maintain the employment because of his or her incapacity. (4) This clause is subject to clause 56(2) and (3).” The Respondent Submits [22] The provisions dealing with vocational rehabilitation are to be dealt with under the 1998 Act (“the Act”), which is governed by Schedule 1 at Clauses 53 to 57. There is no other legislative framework that enables vocational rehabilitation retraining other than those provisions. [23] Pursuant to clause 53 of Schedule 1, clauses 54-57 only apply to an insured who has:- “(a) suffered a personal injury for which he or she has cover; and is (i) entitled to weekly compensation 135-2004 6 (ii) likely, unless he or she has vocational rehabilitation, to be entitled to weekly compensation; or (iii) on parental leave under the Parental Leave and Employment Protection Act 1987.” [24] It is submitted that the appellant does not meet the criteria as set out in Clause 53 of Schedule 1 of the Act. The appellant had returned to gainful employment and was no longer entitled or likely to be entitled to weekly compensation, nor was he on parental leave under the Parental Leave and Employment Protection Act 1987. [25] It is submitted that clause 53 of Schedule 1 does not provide any discretion to the respondent to consider the vocational retraining of a claimant who is not in receipt of weekly compensation. [26] Whilst it is not necessary to consider the specifics of clauses 54-57, it is noted that the purpose of vocational rehabilitation as set out under clause 54 of Schedule 1 is to bring a claimant to a stage where he or she can obtain or regain employment. In this case as the appellant had already regained employment, the purpose of vocational assistance was, therefore defunct. The provisions of vocational rehabilitation under the legislation had no applicability to the appellant. The Submissions of the Appellant [27] The appellant submits that the appellant suffered his shoulder injury on 5 March 1999 and lodged his claim on 31 May 1999. As a result of that application the respondent funded surgery. The appellant was incapacitated from 5 March 1999 to 5 December 1999. Weekly compensation was declined by both the respondent and on review on the basis that he could not fulfil the criteria set out in section 44 of the Act. Following a successful action before the Employment Relations Authority the earlier decisions were reversed and the appellant retrospectively received weekly compensation for the period of his incapacity from 5 March 1999 to 5 December 1999. [28] On 1 December 2001 the appellant wrote enquiring about additional entitlements. The appellant points the administrative delays in the early history of his claim. He submits that these delays have impacted on his ability to apply for the assistance that he seeks by way retraining. The submissions are that if the appellant 135-2004 7 had been correctly assessed for compensation then over the period of delay he could have applied for the benefit that he now seeks. [29] It is not disputed that the appellant could not satisfy the statutory requirement, as the time of his application the appellant was not in receipt of weekly compensation. Decision [30] I sympathise with plight of the appellant, however I am bound by the statutory criteria for imposing the right to the entitlement for rehabilitation assistance. The statutory condition imposed by section 53 provides that in addition to cover for the personal injury that the applicant must at the date of application be entitled to weekly compensation. Clause 54 of the Schedule provides that the purpose of vocational rehabilitation is to help an applicant maintain employment, or obtain employment or to regain or acquire a capacity to work. These purposes are judged at the date of the application. Indeed, clause 57 provides that if the circumstances change the needs of the applicant can be modified to meet the applicant’s changed circumstances. [31] The issue, is therefore, not what the appellant may have received by way of entitlement between March and December 1999, but what his position was at the date of his application. Clearly at the application date he did not meet the statutory criteria, and, therefore, there was no jurisdiction to award the benefit applied for. For these reasons the appeal is dismissed. There will be no order as to costs. DATED at WELLINGTON this ……4th...… day of ………May………. 2004 (J. Cadenhead) District Court Judge 135-2004 8