Teal v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT Decision No. 1 195 HELD AT PALMERSTON NORTH 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 GARRY JAMES TEAL 6-9-94-0215 Appellant (Appeal No. DCA 113/94) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 12th day of December 1994 APPEARANCES Mr A Rowlett for appellant Mr A D Fawcett for respondent DECISION OF JUDGE D A ONGLEY The issue on this appeal concerned the interpretation of r 13 of the Accident Rehabilitation and Compensation Insurance (Aids and Appliances) Regulations 1992 the 1992 Regulations'. The appellant applied for the provision of ancillary equipment and "consumable items" for the operation of a T.E.N.S. machine, a transcutaneous electrical nerve stimulator, which had been provided by the Corporation. The machine is designed to alleviate pain by electrical impulses transmitted through electrodes placed on the skin. The Corporation's power to provide the machine is found in the Accident Compensation (Prescribed Artificial Limbs, Aids and Prosthetic Appliances Costs) Regulations 1990 ('the 1990 Regulations'). The 1990 regulations were continued in force by s 179(4) of the Accident Rehabilitation and Compensation Insurance Act 1992. The 1992 Regulations have three schedules. Reg 7 of those regulations states that the items specified in the first two schedules cannot be provided under the 1990 - 2 - Regulations, and that the items specified in the third schedule cannot be provided under the 1992 Regulations but may be provided under the 1990 Regulations While the 1990 regulations provide for the cost of a T.E.N.S. machine to be met by the Corporation, they do not provide for consumables such as batteries, disposable electrodes and gel. They provide only for "the costs payable by any claimant for any item (and its normal repair or renewal)". The appellant applied for the cost of consumable items under r 13 of the 1992 Regulations, which provide: "13. Maintenance, repair, running costs, and consumable items - (1) Subject to this regulation, neither the Corporation nor an exempt employer shall be responsible for the maintenance, repair, insurance, or running costs of any aid or appliance or for the cost of replacing any consumable items used in association with any aid or applicant. (2) The Corporation or exempt employer shall meet the maintenance or repair costs of any aid or appliance or the costs of replacing consumable items used in association with any aid or appliance where the sum of those costs exceeds $200 in arty 12-month period. The provision for payment by the Corporation of costs after $200 is mandatory, not discretionary. Reg 2 of the 1992 Regulations states: "'Aid or appliance' means a manufactured item for use in New Zealand likely to assist a person with a disability to achieve independence. " If a literal approach is to be taken to the meaning of r 13, it would include replacement of consumable items for any aid or appliance whether or not it had first been provided by the Corporation under one of the sets of regulations. Such an interpretation would leave no limit on the possible expenditure. A claimant might purchase a sophisticated aid requiring very expensive consumables and turn to the Corporation to pay the annual cost. The Corporation could not apply any yardstick of reasonableness or cost effectiveness. That result is clearly beyond the purposes and objects of the Accident Rehabilitation and Compensation Insurance Act 1992 the long title of which is "An Act to establish an insurance-based scheme to rehabilitate and compensate in an equitable and financially affordable manner those persons who suffer personal injury". The rehabilitative scheme of the Act focuses on reasonable contributions to costs and an open ended requirement for the Corporation to pay would be contrary to the scheme of the Act. The appellant submits that the intention of r 13 is to provide for the ongoing costs of all aids and appliances which are provided by the Corporation whether under the 1990 regulations or the 1992 regulations. The answer is not to be found in r 3 which governs the application of the regulations. It stipulates only that the regulations shall apply to any application received on or after the 1st day of July 1992 from a claimant for payment for an aid or appliance. Reg 7 refers to the schedules of the regulations. The first schedule list aids and appliances that the Corporation may approve, but does not limit the scope of aids and appliances that may be approved. All payments must be assessed and approved by the - 3- Corporation in accordance with rr 4, 5 and 9, so that a claimant has no right to determine what payments should be made by the Corporation. The second schedule lists aids and appliances that the Corporation shall not approve except where it is satisfied that the payment is a cost effective alternative to paying future costs of attendant care, home help or child care. The third schedule lists items which may not be provided under these regulations. Further limitations are contained in r 8. Reg 8(1) prevents the Corporation from approving payment for any aid or appliance which the Corporation considers is not necessary for the claimant to achieve independence in daily living or is not required as a direct result of personal injury to the claimant. Reg 8(2) limits approvals after 13 weeks following the accident unless in accordance with a rehabilitation programme. Reg 8(3) limits payments within the 13 week period. Reg 8(4) prevents small claims where the total value is under $100. Reg 8(5) controls repeated claims within 3 years. Reg (6) prevents excessive payments. Reg 11 sets ceilings for certain payments occurring within any 3 year period. It is to be noted that throughout the regulations the expression "aid or appliance" is used generally and without words limiting the items to those provided under the 1992 regulations. That comprehensive mode of expression does not cause any ambiguity where it is used in regulations that themselves legislate limitations on payment. It is only where there is an authorising regulation without an inbuilt limitation that the apparently wide form of words causes difficulty. Reg 10 which provides for hiring aids or appliances would be such a case but it expressly applies the regulations to hiring of aids and appliances and therefore appears to apply the procedure of assessment and approval contained in the other parts of the 1992 regulations. Only r 13 suffers from doubt by virtue of the unrestricted description of aids or appliances. There is no apparent reason for r 13 to provide for unrestricted payment in complete contrast with the limitations built into the rest of the regulations. I conclude that r 13 must have been intended at least to confine the costs of maintenance, repair etc to the costs relating to items which had been provided by the Corporation or which the Corporation could provide under the regulations. The difficulty is to discern whether the intention was to confine payment to aids and appliances originally provided under the 1992 regulations, or to permit some broader but reasonably limited provisions. If the former, then it would have been simple for the drafter to add after the words "aid or appliance" the words "the purchase of which has been approved under these regulations". If the latter, the drafter could have added for example the words "purchased or provided by the Corporation". The provision of consumables is not covered by the 1990 regulations. The 1990 regulations have no schedules. They provide for payment by the Corporation of the cost of any item where it is prescribed by a registered specialist so long as it is for personal injury suffered by the claimant. The 1992 regulations exclude schedule I and II items from its purview, otherwise the range of possible items is open ended. There are some special rules in relation to hearing aids and implants. The cost payable by the Corporation extends to normal repair or renewal, but not to maintenance, insurance, running costs or replacement of consumable items (all being available provisions under r 13 of the 1992 regulations). - 4- There is no cross-over or mutuality between the two set of regulations. The only regulation which is expressly applicable to each set of regulations is r 7(4) and (5) of the 1992 regulations which makes the schedule items exclusive to one set of regulations or the other. There is some possible overlapping because payment for a non-schedule item might be authorised under either set of regulations if it meets the necessary tests. The rationale for the two separate sets of regulations is not obvious. The difference is probably that the 1990 regulations concern items prescribed by medical specialists for essentially medical reasons while the 1992 regulations are connected more directly with social rehabilitation. If that is the distinguishing feature, then it provides no logical justification for wider provision for ongoing costs for items provided under the 1992 regulations. There is logical justification for the appellant's argument that the wider provision for ongoing costs should apply to all items provided under either set of regulations. But the individuality of the separate sets of regulations precludes the conclusion that the 1992 regulations were intended to apply the ongoing cost provisions to any wider category of aids or appliances that those which were provided under the 1992 regulations. I conclude that the ongoing costs authorised in r 13 were intended to be confined to the costs connected with items which may be provided by the Corporation under the 1992 regulations. For the sake of uniformity and fairness perhaps consideration should be given to extending the ongoing cost provision in the 1990 regulations or amalgamating the two sets in an appropriate way. For the reasons that I have stated the appeal is dismissed. 10 th DATED at WELLINGTON this day of January 1995 D A Ongley District Court Judge