Watson v Accident Rehabilitation and Compensation Insurance Corporation

Decision no . 16/96 IN THE DISTRICT COURT DCA No. 149/95 HELD AT WELLINGTON UNDER THE Accident Rehabilitation and Compensation Insurance Act 1992 46/ 95 0307 AND IN THE MATTER of an appeal pursuant to Section 91 of the Act BETWEEN J.A.R. WATSON APPELLANT AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION RESPONDENT Heard at Auckland: 13 December 1995 Date of Decision The appellant in person T.J. Gibbons as Counsel for the respondent RESERVED DECISION OF JUDGE J.W. IMRIE I find that the appeal fails. Introduction: The issue in this appeal is whether the appellant is entitled to receive lump sum compensation pursuant to s. 147. 2 . The appellant suffered a back injury on 23 April 1991 while employed by the Ministry of Transport. His employment was transferred to the New Zealand Police in July 1992. He has now been medically retired from the New Zealand Police. Since the accident he has received treatment from Dr Orr, and a physiotherapist. For a considerable time following the accident his doctor hoped that his back would improve, but he has never been able to stop receiving treatment and suffers persistent back pain. The Corporation paid for his treatment, but he was not told by it that he may also be entitled to lump sum compensation. He was not aware that he would have to make a specific application before a specific date if he wanted lump sum compensation. He received no advice from the Corporation that he was eligible for a transport allowance, nor that he was eligible for a lump sum. He has been told by his case managers that the Corporation advertised the requirements for lump sum compensation but he did not see any of the advertisements, and he said that even if he had he would not have known that he may be entitled to lump sum compensation because the Corporation had not told him that he might be. In March 1994, after a new case manager was assigned, he was told he might be eligible for an independence allowance (and a transport allowance). He was not told that he might also be entitled to a lump sum. He applied for an independence allowance on 25 March 1994, and was assessed on 10 April 1994 and found to have a disability score of 24.8. The first mention of lump sum compensation on the Corporation's file is a file note dated 13 May 1994 which refers to a query from the appellant about an application for lump sum compensation which he said he had filed a year 3. earlier. There is no application on the file, and the appellant said he did not keep a copy of the application. There may have been a misunderstanding on the part of the Corporation officer, as the appellant does not claim that he ever filed an application for lump sum compensation. In a letter dated 21 August 1994 to the Corporation the appellant states he was not aware of his entitlement to lump sum compensation, and would have applied for it if he had been notified by the Corporation of his entitlement. In a further letter dated 20 September 1994, the appellant advised the Corporation that he had not applied for lump sum compensation before the cut-off date as he was still under treatment for his back and believed that he could not apply until his doctors had told him that he was going to get better. By letter dated 10 February 1995, the Corporation advised the appellant that it had declined his request for validation of a lump sum election issue. By application dated 27 April 1995, the appellant applied for a review of the Corporation's decision saying that he was never notified that he was entitled to claim lump sum compensation. The review was heard on 6 June 1995. In her decision dated 15 June, the Review Officer reviewed the history on the file, and referred to s. 147 and said that the Act is clear that in order to be eligible for a lump sum payment a claimant had to have applied for a lump sum payment prior to 1 April 1993, and must have supplied a written election to the Corporation to receive lump sum compensation rather than an independence allowance. She said that the 4. Corporation had no option but to decline the application for lump sum compensation, and the review was unsuccessful. Mr Watson appealed by notice of appeal dated 23 June 1995, stating that the Corporation had not compensated him fairly for his injury and had not fully and fairly informed him of his entitlements after his injury. Mr Watson filed on 3 October 1995 written submissions through his solicitors. Mr Watson was unable to attend the hearing of the appeal on 18 October because of ill health. Ms N.L. Smith appeared for the Corporation and presented submissions in writing. A copy of those submissions was forwarded to Mr Watson and the hearing of the appeal was adjourned until 13 December. Mr Watson attended the hearing on 13 December and discussed his written submissions and Ms Gibson presented a written synopsis of submissions for the respondent, together with copies of the authorities referred to in her submissions. Submissions: In his written submissions Mr Watson reviewed the history of his case, and made a number of points including:- (1) In August 1994, he asked that his independence allowance be back-dated to thirteen weeks after his accident in April 1991. The reason for that request was that he had never been notified that he might be entitled to an independence allowance prior to March 1994. By letter dated 21 October 5. 1994, the Corporation accepted that it had not advised him of his entitlements, and agreed to back-date the payment of an independence allowance to 1 July 1992. Mr Watson said that if the Corporation can accept that it breached its statutory duty in not advising him earlier that he was entitled to receive an independence allowance, it should also accept that it breached its statutory duty in not advising him until March 1994 that he might be entitled to a lump sum, and that he had to make a specific application for it before 1 April 1993, and it should pay his entitlement to lump sum compensation. The long title to the Act "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 by accident" should be interpreted in light of the fact that the Accident Compensation Acts replaces the right to sue for damages for personal injury, and accordingly the Act should be interpreted so as not to unnecessarily deprive persons of statutory compensation when they have no other right of redress. (3) In respect of s. 147:- (a) It should be kept in mind when construing s. 147 that the purpose of the transitional provisions as a whole is to preserve, for a specified period, the right to claim compensation under the 1972 and 1982 Acts for those previously entitled to receive it. (b) Decided cases which have considered s. 147 have placed an overly restrictive interpretation on the section. Whether a claim for cover was also written application for lump sum compensation was held to depend on the wording of the 6 . particular claim form completed by the applicant. That disregards the position under the earlier Acts when to establish eligibility for compensation, it was only necessary to apply for cover by filing a claim. The Corporation then took upon itself the responsibility of determining a claimant's eligibility for particular compensation, and of requiring any additional information. The appellant submitted that the distinction drawn between a "claim" and a "written application" does not accord with the words' normal usages and does not do justice to the spirit of the Act. (d) The responsibility for the wording of the claim form and its appropriateness for compensation rests with the Corporation and not with the complainant. (e) Any requirement for more specific paper work places a duty on the Corporation to ensure that persons who would come within s. 147 if they had filled in the more appropriate specific applications forms were not excluded by reason only that they were not advised to complete the extra forms. Section 64 of the Act contemplates that it is the Corporation which has the responsibility for collecting such specific and relevant information and documentation as it requires. The claimant's responsibility is to provide the information and complete any documentation when requested to do so. (f) Claimants cannot reasonably be expected to know, without assistance from the Corporation, exactly what their entitlements 7 . are under the statutory scheme, and what the Corporation's formal requirements entail. (g) The intention of s. 147(2) is to provide the right to forego lump sum compensation under the 1982 Act in favour of an independence allowance under the 1992 Act. An election need only be made if an independence allowance is the form of compensation preferred. The requirement of a written application for lump sum compensation (subsection (1)) and the election to receive an independence allowance (subsection (2)) are in the alternative. In her submissions Ms Gibbons submitted first that the appellant has not . complied with the provisions of s. 147. The Corporation accepted that by completing the C1 advice of injury form dated 28 August 1992, the appellant lodged a claim for compensation before 1 October 1992 as required by subsection (2A). However, the appellant did not:- (a) Make a written application for lump sum compensation prior to 1 April 1993 as required by s. 147(1) or (b) Elect in writing not later than 31 March 1993 to receive lump sum compensation as required under s. 147(2). Ms Gibbons submitted that:- (1) The argument that a claimant should not have to comply with s. 147 if he was not aware of its requirements has been considered in a number of cases 8 . which make it clear that the reason that the complainant does not comply with s. 147 makes no difference. (2) The C1 advice of injury form was not an application for lump sum compensation. It is no more than a general claim for personal injury by accident. No part of the form refers to any application for entitlements that may arise under the Act. There is no reference to lump sum compensation. (3) The submission on behalf of the appellant that it is necessary to make an election only if the claimant wishes to receive the independence allowance does not accord with s. 147(3). Conclusion on Section 147: My conclusion is that the appellant is not entitled to lump sum compensation because he did not make a written application for that compensation before 1 April 1993 as required by subsection (1), and because he did not elect in writing not later than 31 March 1993 to receive lump sum compensation. It is not necessary for me to set out in this decision extracts from previous appeal decisions covering those points. The appellant is familiar with them and has referred to them in his submissions. * It may be that the appellant has a cause of action against the Corporation outside the Act because of the appellant's failure to advise him of its requirements in relation to s. 147. However, that is a question for the appellant and his legal advisers. 9. Section 156: At the hearing on 13 December I advised the appellant and Ms Gibbons that in another appeal I had been asked to decide if s. 156 allowed the Corporation to pay lump sum compensation in a case where the appellant was not entitled under s. 147 to lump sum compensation. It was agreed that I should consider s. 156 as well for the purposes of this appeal but did not wish to make submissions on s. 156. I have now given my decision on that other appeal (Williams v ARCIC DCA 165/95). Section 156 reads:- "156. Functions, duties, and powers of Corporation - (1) The Corporation shall perform such functions and duties and have such powers as are conferred or imposed on it by or under this or any other Act. (2) The Corporation shall also have such powers as are necessary or expedient to enable it to perform its functions and duties. (3) Without limiting subsection (2) of this section, the Corporation has power to contract with the Crown, any department of State, or any other person or organisation for the performance of any of its functions or duties or the exercise of any of its powers." My conclusion is that while s. 156(2) gives the Corporation such powers as are necessary or expedient to enable it to perform its functions and duties under the Act those functions and duties do not include making payments which are not authorised under the Act. In this case the appellant has not 10. brought himself within s. 147 of the Act so as to entitle him to lump sum compensation. To the contrary, pursuant to s. 147(3) the appellant is deemed to have elected to receive an independence allowance under and subject to the conditions of s.54. Accordingly the Corporation is not authorised by s. 156(2) to pay lump sum compensation in this case. Conclusion: The appeal fails. Leave is reserved to the Corporation to apply for costs. District Court Judge