Jamieson v Accident Compensation Corporation

IN THE DISTRICT COURT AT TAURANGA [2015] NZACC 295 ACR 452/13 UNDER THE ACCIDENT COMPENSATION ACT 2001 IN THE MATTER OF AN APPEAL UNDER SECTION 149 OF THE ACT BETWEEN LORRAINE LUCY JAMIESON Appellant AND ACCIDENT COMPENSATION CORPORATION Respondent Hearing: 20 August 2015 with reply submissions filed 27 August 2015 Appearances: The appellant in person F Becroft for the respondent Judgment: 29 September 2015 RESERVED JUDGMENT OF JUDGE A N MACLEAN [1] This case involves a decision by the respondent dated 10 October 2012 advising the appellant that she was eligible for a combined independence allowance based on a 60 percent whole person impairment ("WPI") backdated to 16 September 1999. The decision advised that the backdated allowance could be paid in a lump sum after an adjustment for a "previously paid for 25% impairment". The appellant challenges both the way the 60% calculation was made and the deduction. She is also concerned that there has been some confusion within the respondent regarding other files for her and the implications of that. [2] At a review on 8 July 2013 a reviewer upheld the respondent's decision from which this appeal has been brought. Background [3] This appeal is the culmination of over 20 years of interaction between the parties, in relation to back injuries sustained in December 1993 and June 1994. The first injury occurred which is the primary focus in this appeal, happened, as it is described in the initial claim form while "moving a plant tub to sweep leaves from behind it-I had to lift it slightly and felt pain..." which progressed initially as non- operative treatment but later in July 1994 (removal presumed disc prolapse at L3/4 level), to surgical treatment. The focus of attention in this appeal is on the effects of the first accident (initially recorded by the respondent in 1993 as "strain lower back/spine and subsequently as "Lumbar disc prolapse with cauda equine compression" ("CES") under claim number E2926892/002. For completeness, there were other files for the appellant including those with suffix 001 (accident 29/2/92), 003 (the June 1994 accident). [4] For the purposes of this decision, it is not necessary to traverse in detail the progress of the claim through the 1990s and early part of this century which included a variety of assessments, reviews, District Court appeal, and declined application for leave to appeal to the High Court. Through that process a number of impairment assessments were carried out including: By Dr Bernard on 1 1 March 1999 who, after applying the AMA guides to impairment 4" edition ("AMA 4") concluded a 50% WPI including a rating for a diagnosed cauda equina like syndrome without bowel impairment and cauda equina syndrome ("CES") with bowel impairment. A revision by a Dr Shoemac suggesting a WPI of around 10 percent WPI. A further revision as a consequence by Dr Bernard to 25 percent. A further assessment by Dr Fong confirming 25 percent, albeit with a different calculation method. A WPI by a Mr Partridge in May 2002 suggesting "at least a 45% but more properly 55%" That was critiqued by Dr Morris, Corporate Medical Advisor of the respondent in August 2002 opining it should be "10 percent combined with 17 percent which is the 25 percent that Mr Fong concluded". [5] There is no point in traversing the detail of the mechanism by which those various WPIs were calculated primarily because the assessments were done under different rules and the appellant herself does not have concerns about them. WPI in issue now is that of Dr Paul Noonan following an examination on 2 October 2012, of 60 percent. [6] Turning to a little more detailed history of some issues; on 17 May 2004 the respondent issued a cover decision for chronic lumbar back pain and the sequelae of CES. [7] That then went through a review procedure and in 2005 solicitors then acting for the appellant, sought to have the respondent revisit previous independence allowance decisions and revert back to a 50% WPI based on the new cover decision, to which the respondent said that acknowledgement of cover for CES did not affect the correctness of a 25% WPI. 8] Through 2006 to 2009, another solicitor on behalf of the appellant, having sought a revision of a 1999 independence allowance decision which was declined but without review rights lodged a judicial review to the High Court. 9] In the result, following negotiations between further solicitors acting for the appellant and a Mr Barnett for the respondent, a settlement was reached which is recorded by His Honour Priestley J in a minute dated 24 August 2011 which, after making reference to a consent memorandum (no copy of which has been tabled) closed the appeal. Key points from that minute noted: A Consent memorandum was prepared by counsel for the appellant and signed by counsel for the respondent. The appellant had in the meantime suffered a stroke and "at some uncertain date has purported to withdraw her consent to the agreement". That counsel for the appellant sought leave to withdraw as he could not obtain "coherent instructions" (because the appellant had suffered a stroke). His Honour noted "I am satisfied there is a concluded settlement negotiated by counsel in terms of their respective retainers. The appeal is thus at an end". That the agreement noted by Priestly J was that the appellant "is to be reassessed by the first defendant (the respondent in the present case) and any rights she may have to challenge the new assessment are unaffected. That the assessment was to be carried out 'in accordance with the law'. Issues [10] One of the complications in this case is to determine the scope and effect of the purported settlement and in particular what "law" applies. 1 1] That is because, although there is reference at various points to memoranda, the only evidence before this Court, apart from the High Court minutes, is correspondence between respective counsel. [12] Interpretation of that, has implications for the exercise of analysing another issue that has been raised, as to whether the respondent has reached its contested decision based on the wrong version of the Act, raising potential issues in terms of the transitional provisions of the Accident Compensation Act 2001( "the 2001 Act"), alleged misapplication of part 4 and the related schedules of the Accident Insurance Act 1998 Act ("the 1988 Act "), and the extent to which the provisions of the Accident Rehabilitation & Compensation Insurance Act 1992 (the "1992 Act", particularly ss 54 and 54A, ("the 1992 Act") applying that context the appellant asserts that the 25% deduction is not allowable and should be treated as a payment made in error under file claim 003 and falling within s 390(5). What was the "Settlement" [13] Absent anything else, the only evidence this Court has relevant to this aspect is: An initial letter of 11 March 2011 from counsel for the respondent (Alistair Barnett) to counsel for the appellant (Alex Hope). I now advise I have instructions to propose settlement of this application for judicial review. The proposal is that a fresh assessment will be undertaken to replace that made in 1999. The assessment will be made using the AMA guides and the handbook. The Corporation will then issue a new decision which will be reviewable under the Act. The application for judicial review is to be discontinued forthwith. Then a further letter of 4 April 2011 from Mr Barnett which starts by referring to a letter of the same date from Mr Hope, which also is not tabled. That letter included: The decision will be revoked and replaced with a new decision. ... as a new or replacement decision it will be made under the 1998 Act and the Regulations then applying. Notwithstanding that the handbook did not apply until the advent of the 2001 Act - as advised the decision will be made using the handbook. That is something Mrs Jamieson has asked for. As advised the decision will be reviewable. The new decision will replace the original decision which will be revoked, Thus any increase in the entitlement will be backdated. The new assessment will involve a new medical examination. Any material you consider relevant will be placed before the assessor. Likewise any materials the ACC consider relevant will go to the assessor. Mrs Jamieson has cover for the sequelae of cauda equina syndrome (refer ACC letter 17 May 2004) and this cover is unaffected by the proposed new decision. A response to that from Mr Hope of 21 June 2011. A further memorandum of 27 July 2011 from Mr Hope to Mr Barnett setting out some questions from the appellant. A further letter of 2 August 201 1 from Mr Barnett to Mr Hope. Then follows the minute of Priestley J referred to earlier. [14] The letter from Mr Hope of 21 June 2011, after making reference to "my memorandum of 21 June 2010"(which has not been tabled"), made some further proposals. Key aspects are: The cover decision of 17 May 2004 needs to correctly state the injury rather than describe the effects. The cover should be described as being for" a disc prolapse and left L3 nerve root compression". The cover and entitlements for the 1 1 December 1993 injury need to be recorded against number E926892-002. That whilst all relevant medical information and records should be made available to the assessor he was not to be provided with any previous ACC assessments or advice letters or in particular not any of the reports from Drs Bernard, Shoemac, Morris and Fong nor any of the review or Court decisions. That the assessment must include the impairments caused by the accidental injury on 11 December 1993 only. It must not include any non injury related or nonexistent impairments. [15] The supplementary questions in the letter of 27 July 201 1 from Mr Hope, as will be noted later, introduces some themes which still resonate in this appeal. They include the following questions that it seems may have been raised about that time by the appellant to her solicitor : What law requires that pre 1 July 1999 injuries are assessed and combined. What law requires Mrs Jamieson to have the 2002 injury included in the assessment. Is the new assessment being offered as a new transitional arrangement under the 1998 Act. Will it assess her impairments as at 1999. Will there be a reimbursement of arrears. [16] The response letter from Mr Barnett of 2 August 2011 included: The ACC is proposing to revise a decision made on 14 May 1999 so what is required is to make it in terms of the Act then applying. Thus the 1992 Act applies and on the claims history I take it to be there is no preceding covering injury with any material impairments so no legal or factual issues arise about a combined assessment, that is it would be a single assessment for a single injury in 1993. It is appropriate that the assessor should have all subsequent medical records and is aware that a 15 percent lump sum was paid out on a back injury in 2002 but the correct approach is to exclude that injury from the physical assessment made. A combined assessment is not required. Mrs Jamieson will be assessed as at May 1999 on the 1993 back injury and she herself acknowledges no material permanent impairment from the 1994 injury. The law doesn't require the 2002 injury to be included but as a matter of medical assessment the assessor is going to have to make sure that impairments now present are not ones arising from that injury. One way or another the 15 percent WPI for the 2002 injury logically cannot be part of a prior injury. It is to be made under the 1992 Act as that was in force when the decision was made. Having seen the assessment of the WPI on the 2002 injury it is expressly in respect of the December 2002 injury. [17] The above is the only evidence the Court has as to the settlement between the parties. There are some ramifications flowing from that particularly with regard to one of the central contested issues in this appeal, namely the relevant legislation to apply. The Respondent's Position with Regard to the Applicable Law 18] The respondent submits now (notwithstanding the statement in the correspondence referred to above of Mr Barnett, that the 1992 Act applies) that in fact the 2001 Act is the starting point. [19] Further, that the applicable section is s 377(1) of the 2001 Act linked with s 441 and 442 of the 1988 Act. [20] Key parts of s 377 state, in respect of independence allowances for personal injury suffered before 1 July 1999: (1) On commencement of this section, sections 441 and 442 of the Accident Insurance Act 1998 cease to have effect. (2) A person who suffered personal injury before 1 July 1999 is entitled to be assessed for an independence allowance under Part 4 of Schedule 1 of the Accident Insurance Act 1998 irrespective of when the claim for cover for the personal injury was or is lodged, subject to the modifications set out in subsection (3). (3) The modifications are that: (a) Any assessment or reassessment must be done on the basis of whole person impairment for the combined effect of all injuries suffered before 1 July 1999 for which the person has cover and (b) The percentage of impairment for which any lump sum compensation was received under section 119 of the Accident Compensation Act 1972 or section 78 of the Accident Compensation Act 1982 or both must be deducted from the percentage of combined whole-person impairment assessed in accordance with paragraph (a). [21] Based on that, the respondent's submission is that each of the appellant's injuries suffered before 1 July 1999, is required to have the impairment ratings combined and that only one independence allowance is payable in respect of any number of injuries. [22] The respondent further submits, that the provisions relating to assessment are contained as per s 377(2) in Part 4 of Schedule 1 clauses 58 to 61 namely that the assessment is to be by an assessor applying AMA 4 and the ACC user handbook to it What is the Appellant's Position on the Law [23] The appellant says the 1992 Act should apply and points to s 351 of the 2001 Act which states: "A former Act, or a section in a former Act, applied by or under any of sections 352 to 400, applies as if the Act or section had not been repealed". [24] Accordingly she submits that utilising ss 441 and 442 of the 1998 Act and the schedule provisions referred to earlier, purporting to be done pursuant to s 377(1) of the 2001 Act, is an error. [25] Instead the appellant submits that s 351 and s 390 of the 2001 Act applies. [26] Section 351 states 'a former Act , applied by or under any of the sections 352 to 400 applies as the Act or Section had not been repealed . [27] The relevant provisions of's 390 are: (1) The Corporation may revise decision specified in subsection (2) if it appears to the Corporation that the decision was made in error, whatever the reason for the error. (2) The decisions are the following decisions made before the commencement of this Act: (a) Decisions made by the Corporation ... (3) In revising a decision, the Corporation must apply the Act that applied at the time, when the decision was being revised was made. (4) The Corporation may revise a decision that by operation of s 66(1) of the Accident Insurance Act 1998 it has accepted a claim. (5) However if the Corporation issues a decision in reliance on subs (4) the Corporation may not recover from the claimant any payments made by it in respect of the claim, before the date of revision ... (6) A revision may a) Amend the original decision or Revoke the original decision and substitute a new decision. (7 ) Every amendment to a decision and every substituted decision is a fresh decision. [28] Accordingly the appellant's position is that the provisions of s 351 (continuation of former Act), and s 390 read in conjunction with as she puts it "the terms and conditions and legislation agreed to in writing by ACC per letter of 2 August 2011 mean that the applicable law comes from s 54 and 54A of the 1992 Act". Also s 63(4) of the 1992 Act, on the basis that it required any payment of an allowance must be preceded by a written itemised and signed application. Her point is that she has never filed a claim in respect of the 1994 injury and the Corporation have been for a long time confusing other non related claims and incorporating them in the present claim. Her further point is that the respondent wrongly paid out claim 003 without that written approval. [29] Also that it is inappropriate to deduct the WPI lump sum already paid from the settlement amount because it is an irrevocable earlier payment made in error [30] In her final written submission which accompanied a letter received on 27 August after the hearing, together with documentation regarding the settlement agreement referred to earlier in the minute of Priestley J (which as it happened and she noted in her letter) in fact were in the respondent's bundle which she had not seen before the hearing, the appellant noted that she "remained concerned that the validity of the new ACC decision may well be in question since it has been conceded that this was issued in reliance on the 1998 Act, and on s 377 of the 2001 Act, neither of which were in force or applicable to my original 4 March 1999 reassessment, nor the 14 May 1999 AC decision on my independence allowance entitlement" Analysis and Discussion [31] The material parts of s 54 of the 1992 Act require, as with the 2001 Act provision for an independence allowance provided that a degree of disability of 10% or more exists and that the allowance is to be carried out pursuant to scales prescribed under that Act, or in the absence of scales the American Medical Association Guides to the Evaluation of Permanent Impairment (Second edition) and provides for reassessment from time to time at intervals of not less than five years. [32] Section 54A provided that if payments had been made for the purpose of an entitlement for an independence allowance under earlier Acts, i.e. the Accident Compensation Act 1972 or the Accident Compensation Act 1982, any such impairment assessment was to be deducted from the person's impairment as assessed under the 1992 Act. [33] Aside from the issue of the deduction of the previous WPI, the major issue is centred on the correct approach in implementation of the High Court facilitated settlement. [34] Critical in the determination of this is the observation of Priestley J that the assessment must be carried out in accordance with the law. [35] Although Mr Barnett's letter of 2 August 2011 spoke about the assessment being "made under the 1992 Act as that was in force when the decision was made" it is clear from the earlier letter of 4 April 201 1 that the proposal was to start again with a new or replacement decision and that "notwithstanding that the handbook did not apply until the advent of the 2001 Act - as advised the decision will be made using the handbook". [36] That then means that the issue becomes whether or not the provisions of the handbook in relation to the AMA Code have been correctly applied by Dr Noonan. [37] As many previous cases such as Anderson v ACC, King v ACC' and W have noted analysis and application of the relevant handbook and AMA Code provisions are a matter for the properly qualified medical practitioners who work in this area and courts will not interfere or question an assessment unless there is clear and compelling evidence that the assessment has been made incorrectly or the criteria of the AMA Codes has not been followed. [38] The question then arises as to whether the appellant has demonstrated some material flaw or omission whether by expert evidence or otherwise. There is no counter expert opinion, only that of the appellant. [39] The issues relevant that she raises are that Dr Noonan failed to take into account L3 nerve root impairment but it is clear from a careful reading of Dr Noonan's assessment that he did take into account the functional limitations arising from the defects from L3 to S2. [40] Other issues that the appellant raised in addition to the proposition of incorrect legislation being applied included failure to obtain a peer review and the deduction question mentioned earlier. [41] In fact in terms of a peer review there is a confirmation from Professor Mccormack as to Dr Noonan's rating. So far as the elaborate argument that the appellant presented regarding the issue of the applicable Act, much of that is a side issue because the starting point is that what is being challenged now is an assessment made after the 2001 Act has come into force. The High Court facilitated settlement does not change the reality that the assessment had to be carried out either as a matter of law and/or as a matter of settlement under the applicable AMA Code and handbook and that was done. So far as the question of the deduction is concerned both under previous legislation and under the current legislation it is clear that a whole person impairment as carried out in this case must take into account all preceding injury and relevant factors prior to 1 July 1991 pursuant to s 377(1) of the (286/99) IN (4/2004) (284/04) 2001 Act. That section linking as it does with ss 441 and 442 of the 1998 Act make it clear in particular in s 441(3)(c): Any assessment under clause 60 of Schedule 1 or reassessment under clause 61 of Schedule 1 must be done on the basis of whole person impairment for the combined effect of all his or her personal injuries covered by the former Acts, and only one independence allowance is payable for all those injuries. [42] In other words regardless of whatever file referencing system was used within the respondents (and indeed it seems some degree of confusion internally) the reality is that the assessor had to take into account the previous 25 percent allowance and deduct it from the latest assessment. It matters not that that payment happened to be cross referenced with a different file number for which, as the appellant concedes, there was no entitlement as the reality is it was paid in relation to the same underlying 1993 injury as it evolved and must be taken into account. [43] There were some other issues which need not be canvassed now. [44] Firstly on the question of interest, the appellant acknowledged at the hearing that the respondent and the reviewer were correct when they stated that there is no provision for payment of interest on a lump sum WPI payment for an independence allowance (see La Belle' ...). [45] Nor is there any issue seriously taken with the reviewer's decision that there was no jurisdiction to cover the appellant for costs entailed with the judicial review proceedings that resulted in the High Court mediated settlement. [46] Accordingly the appeal is dismissed. There is no issue as to costs. Judge A N Maclean District Court Judge 49/06 ACR 452-13-Jamieson