Whare v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT ROTORUA Decision No. 80 / 96 UNDER The Accident Rehabilitation and Compensation Insurance Act 1992 AND 58 95 / 24 58 IN THE MATTER of an appeal pursuant to section 91 of the Act BETWEEN JOANNE OLIVE WHARE of Rotorua Appellant (Appeal No. DCA 3/96) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 26th day of August 1996 APPEARANCES Ms S M Kissling for appellant MS R F Irving for respondent DECISION OF JUDGE A W MIDDLETON The principal issue in this appeal is whether the appellant is entitled to earnings related compensation as a result of the failure of the respondent to conduct a review hearing within three months of it being lodged with the respondent on 30 November 1994. While I have stated the principal issue the file discloses peripheral matters which have to be considered in relation to this appeal. The facts which give rise to the appeal are that the appellant was assaulted in January 1986 when she suffered a blow to her right eye and which subsequently developed double vision which has not settled despite two operations. The 2 respondent accepted the appellant's claim for cover and paid her various entitlements, together with an award under s.78 of the Accident Compensation Act 1982 on the basis of an assessment of a 30 percent permanent functional impairment. Subsequently in 1994 the respondent received an opinion from Mr Craven, a neurologist, in which he said that the appellant's double vision was as a result of a medical condition and not a result of the 1986 accident. Accordingly on 6 October 1994 the respondent advised the appellant that because it was understood that she then suffered from a non-accident related condition further entitlements to compensation would cease as from 19 October 1994. The appellant through her solicitor lodged an application for review of that decision on 30 November 1994 in which she requested that cover be reinstated and that she receive earnings related compensation and further other requests for various items of compensation which are not relevant to this-appeal. The appellant then submitted a report from Dr Singh which contradicted the opinion of Mr Craven. As a result of that information the respondent notified the appellant that pursuant to s.67A of the Accident Rehabilitation and Compensation Insurance Act 1992, it proposed to amend its earlier decision of 6 October 1994 by reinstating cover. There appears to be some dispute as to how that information was communicated to the appellant and her solicitor. The respondent contends that the communication was made by telephone in February 1995 which is denied by the appellant. However, it was confirmed by letter dated 6 March 1995. That letter advised the appellant that her entitlements would continue as if the decision of 6 October 1994 had not been made. The appellant through her solicitor notified the respondent that she did not accept that the respondent was entitled to revoke its decision under s.67A of the 1992 Act and contended that by virtue of s.90(9) the appellant was entitled to assume that a decision had been made in her favour with the result that she was entitled to be paid earnings related compensation under the 1992 Act. On 30 May 1995 the respondent notified the appellant that it was then in a position to consider an application for earnings related compensation and had made a decision that she had no entitlement because there was insufficient medical information in support of her claim. The appellant lodged a further application for review of that decision on 24 July 1995. A review hearing took place on 12 October 1995 and in his decision the review officer has stated that the issue before him was the respondent's decision of 30 May 1995. While submissions had been made in relation to s.90(9) and the failure to hold the review hearing within 3 months of application the review officer appears not to have been concerned with that issue and found that on the basis that there was insufficient medical evidence the decision of the respondent on 30 May 1995 should be upheld. Ms Kissling submitted: 3 1. That the failure of the respondent to undertake the review in respect of the appellant's application of 29 November 1994 meant that the review should be deemed to be determined in favour of the appellant with the result that it was binding on both parties and that the appellant was therefore entitled to payment of earnings related compensation because of her request for that relief in the application for review. 2. That it was not open to the respondent to then attempt to revoke its decision of 6 October 1994 pursuant to s.67 A by its letter dated 6 March 1995. 3. That a revocation pursuant to s.67 A and a determination under s.90(9) do not have the same effect because pursuant to s.90(3) a determination under s.90(9) is binding on all parties whereas a decision under s.67A can only be challenged on review. 4. That the finding of the review officer that s.90(9) had no application and that there was no entitlement to earnings related compensation was incorrect. Ms Irving submitted: 1. That s.67 A permits the respondent at any time to revise a decision as made if that decision has been made in error or mistake or by reason that fresh evidence is available which requires the decision to be amended. 2. That on 16 February 1995 the respondent made a decision under s.67A with the result that it revoked the decision made on 6 October 1994 before the provisions of s.90(9) could be deemed to have come into effect. That this result was notified to the appellant's solicitor (although as I have previously stated this is denied by the appellant's solicitor), but was subsequently confirmed by the letter of 6 March 1995. 3. That the respondent was entitled to revise its decision under s.67A on the basis of the fresh medical evidence. 4. That because of that decision s.90(9) did not come into effect as the respondent had revised its decision and notified the appellant's solicitor prior to the expiration of the three month period. 5. That pursuant to the decision in Tito v ARCIC (13/96) if s.90(9) applies to this appeal the respondent cannot be required to do something which is outside its powers. That the respondent had no power to make payment of earnings related compensation because there was no medical evidence to support such a claim. I consider that there is considerable doubt that the Court should accept that the respondent's decision apparently made in February 1995 but not communicated 4 by letter to the appellant until 6 March 1995, should be accepted in support of a claim that s.90(9) cannot be invoked. I do not consider that a decision of this importance, if it was communicated by telephone to the appellant's solicitor prior to the end of February 1995 was proper notice of a serious decision of the respondent. I consider that at that time the appellant was entitled to accept pursuant to s.90(9) that the application for review was determined in her favour. However, that does not mean that because her application for review included the specific claims which she wished to make a determination in her favour could be said to result in the success of those claims. I consider that the determination pursuant to s.90(9) was merely a decision made in favour of the appellant in respect of the decision of the respondent made on 6 October 1994 which was cancellation of cover. I consider that the result of the determination is merely that the appellant is entitled to a reinstatement of cover and not to the various items which she listed as being the entitlements she perceived should follow. Those claims would have to be the subject of separate decisions, the appellant having been found to be entitled to cover. The decision of the respondent of 6 February 1995 that it decided to revoke its previous decision under s.67A does not take the situation any further as the result is the same as my finding that the appellant was entitled to cover pursuant to s.90(9). Subsequently, the issue of entitlement to earnings related compensation was considered by the respondent and the application was declined pursuant to its letter of 30 May 1995 on the grounds that there was insufficient medical certification that the appellant's injuries precluded her from working. I am concerned that because the appellant's attention has been diverted from the real issue by the assumption that she had established entitlement to earnings related compensation because of the determination under s.90(9), no specific request appears to have been made of the specialists involved as to how the injuries affected her ability to work. This in fact appears to be conceded by Ms Kissling in her submission No. 33 in which she stated: "There is no question that the appellant has not provided regular medical certificates from the date of accident certifying her inability to work. As stated before, the appellant was only advised of her entitlement in 1994 and immediately provided the letter from Dr Fletcher." Unfortunately the letter from Dr Fletcher does not specify whether or not the appellant's problems precluded her from working. On an examination of the file there appears to be a considerable reference to the appellant's inability to work and the need for home help and other assistance which may indicate an inability to work because of her injuries. In the interests of justice I consider that the question of entitlement to earnings related compensation should be referred back to the respondent with the direction that a full medical report be obtained with the 5 specific request that it be the object of the report to ascertain whether and by how much the appellant's ability to work is affected by her injury. Accordingly the file will be returned to the respondent for that purpose and hopefully the matter can be resolved without further reference to the Court. DATED at WELLINGTON this 12 day of September : 1996 A W Middleton District Court Judge dc3-96.doc(rd)