Bojesen-Trepka v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT TAURANGA Decision No. 232 /97 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 MARK HOLTEN BOJESEN-TREPKA DCA 73/97 Appellant AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 29th day of October 1997 APPEARANCES: No appearance of appellant Ms L Rice for respondent DECISION OF JUDGE MJ BEATTIE This appeal was scheduled for hearing on Wednesday 29 October 1997 at 11.30 am and the record notes that the appellant was duly advised of the time, date and place of that hearing. The appellant did not appear but the 2 respondent was represented by Ms Rice. A hearing as such did not take place because of the non-appearance of the appellant however, I informed counsel for the respondent that the appellant had provided submissions to the Court in support of his appeal and that in those circumstances I would deal with this appeal on the papers. Counsel for the respondent indicated that she had nothing further to add to the written submissions which had been filed and which had been served on the appellant save to provide the Court with a copy of a High Court decision ARCIC v P J Walsh a decision of His Honour Justice Salmon Auckland High Court (HC 38/96). Accordingly, I now propose to deal with this appeal on the papers, as filed. The issue in this appeal is whether the Corporation is required to or has authority to reimburse the appellant for private hospital, surgery and treatment costs undertaken by the appellant without the prior knowledge or consent of the respondent. Background Facts On 25 October 1995 the appellant then aged 37 suffered a torn bicep muscle in his left arm playing touch rugby. He lodged a claim for treatment for same with the Corporation and cover was accepted. In the letter of advice of acceptance of cover the appellant was advised of what his entitlements and obligations were and in particular: "Important Points You Need To Know 3 Private hospital treatment must be approved in writing before the treatment is given. ACC is unable to give an approval after the treatment." I think that the rest of the narrative of background facts is best encapsulated in the letter of the appellant of 9 April 1996 to the Corporation which reads as follows: "Dear Sir The purpose of this letter is to outline the events which have required me to retrospectively claim moneys from ACC under section 62. Last October (1995) while playing touch rugby I injured my arm, and on seeing my GP, was advised that I had done some serious bicep damage. He then referred me to a specialist (Mr MacDiarmid) who in turn advised me that I would be able to consult with him on February 8 1996. In the meantime (Dec. 1995) with my arm getting progressively worse, I was advised that there was only a two month window from the time of the accident in which to operate - if I was to regain the use of my left arm. On hearing this I contacted Mr. MacDiarmid who agreed to see me on Dec. 20. When I saw him at 1 p.m. - he confirmed that the damage was extremely severe, and in fact that I had completely torn the bicep muscle / tendon away from the bone; and that it was already potentially past the time for a successful operation. As chance would have it he was operating that afternoon, and agreed to do me, if a bed could be found. Fortunately there was, and one hour later I was under the knife. 4 Because of the immediacy of the operation, Mr. MacDiarmid failed to alert ACC that I was to have a surgical procedure, and when I claimed the ACC portion through our medical insurers (Southern Cross) I was told that it was too late. Indeed Southern Cross also say that they will not pay - because ACC have not / will not contribute their portion. In the meantime I am left holding the baby. I would therefor(sic) be most grateful if you would consider a retrospective claim under section 62. The costs incurred were: (copies of invoices attached) Mr MacDiarmid $ 585.50 Tauranga Anaesthetic Centre $ 415.16 Norfolk Hospital $1580.52 Thank you for your consideration of this matter." By letter dated 17 April 1996 to the Appellant the Corporation advised: "As the cost of private surgery needs to be approved prior to surgery, the application is therefore declined." It was that decision which the appellant sought to have reviewed. The Review Officer's decision stated that although the surgeon's letter to the Corporation indicated that the surgery was carried out due to a degree of urgency to enable the appellant to get a reasonably good result, that situation is not covered under either clause 4(a) or (b) of Regulation 11 of the Accident Compensation (Specialist's costs) Regulations No.2 1990. The Corporation's decision to decline payment was confirmed. 5 In his written submissions to the Court the appellant stated that: "Because of the immediacy of the operation Mr MacDiarmid failed to alert ACC that I was to have a surgical procedure, and when I claimed the ACC portion (20%) of the costs from Mr MacDiarmid, the Tauranga Anaesthetic Clinic and Norfolk Hospital. I was told that ACC would not pay because ACC had not given an approval in writing.." The appellant submits that Regulation 11 commits the Corporation to make payment as the Norfolk Hospital is a licenced hospital and that the procedure was necessary for the due restoration of the claimant to his principal economic activity. He further contends that general approval for treatment was given in the letter of approval of claim of 1 May 1996. The appellant also raises a moral argument namely that having regard to the background and the circumstances under which surgery was undertaken, there was no reasonable opportunity for Mr MacDiarmid to obtain prior approval having regard to the fact that the operation was done one hour after consultation. Counsel for the respondent submits that the Corporation has no authority to accept the appellant's application for payment of his surgery costs. The Corporation is only authorised to make payment for treatment in accordance with the regulations and that clause 11 of the Regulations provides that the Corporation must not make any payment in respect of any procedure specified in Part II of the schedule unless: a) The treatment is provided i) In a licenced hospital; or 6 ii) In the case of items marked in the schedule with an asterisk(*) in the registered specialist rooms AND b) The prior approval of the Corporation to the performance of the procedure has been obtained. Counsel submitted that the appellant's circumstances do not come within the exceptions in clause 11 (4) in that the procedure was not a procedure mentioned in Part II of the schedule that is marked with a cross(+) and it was not a procedure that is discovered to be necessary to perform and is performed during the course of any approved treatment. Repair biceps tendon in Part II of the schedule is not marked with a cross(+). Relevant Statutory Provisions Section 27(1) of the Accident Rehabilitation and Compensation Insurance Act 1992 ("the Act") provides that: 27. Treatment and physical rehabilitation --- (1) The Corporation shall contribute to the cost of any treatment, service, physical rehabilitation, related transport, or certificate (in this section called a purchased service), in respect of personal injury that is covered by this Act. -- (a) To the extent required or permitted by regulations made under this Act; or (6 ) Pursuant to an agreement, contract, or arrangement entered into under section 29A of this Act. 7 Clause 11 of the Regulations states that: 11. Conditions applying to payments for surgical procedures (1) The Corporation shall not make any payment in respect of any procedure specified in Part II of the Schedule to these regulations unless- (a) The treatment is provided - (i) In a licensed hospital; or (ii) In the case of items marked in the Schedule with an asterisk (*), in the registered specialist's rooms; and b) The prior approval of the Corporation to the performance of the procedure has been obtained. (2) Except as provided in subReg(3) of this regulation, the Corporation shall not give the approval referred to in subReg (1) of this regulation unless it is satisfied that it is necessary for the due restoration of the claimant to his or her principal economic activity or would enable the claimant to undertake remunerated employment that the treatment be provided. (3) The Corporation shall give the approval referred to in subReg (1) of this regulation where --- (a) The procedure is specified in Part II of the Schedule to these regulations under the heading "Plastic Surgical Procedures"; and 8 (b) The Corporation is satisfied. after obtaining such assessments as the Corporation considers necessary (which assessments shall be obtained at the expense of the Corporation), that without the Completion of the procedure the claimant would not be able to participate in the normal social activities that might be expected for that claimant. (4 ) Nothing in this regulation shall apply in respect of --- (a) Any procedure in Part II of the Schedule to these regulations that is marked with a cross(+); or (b) Any procedure that is discovered to be necessary to perform, and is performed, during the course of any approved treatment. Decision The evidence is clear that the appellant was aware, prior to having the surgery, that if he wished the Corporation to pay for private hospital surgical treatment then the Corporation's prior approval for such treatment would be required. Whilst there may well have been reasonably pressing reasons why the appellant required the surgery he did, there is no evidence to suggest that his physical condition was deteriorating by the hour and it would have been quite possible to have obtained the prior approval and have the treatment re- scheduled for sometime after that approval had been given. The regulations are quite clear and section 27 of the Act makes it equally clear that the ability of the Corporation to make payment for any treatment 9 service or other claim can only be made if the Act or Regulations made under it permit. The Act does not grant the Corporation any general discretionary power and this Court on several occasions has been obliged to state that if the provisions of the Act do not allow for payment then such payment cannot be made. Such is the case irrespective of any moral force of the argument of the claimant. This very issue was considered by the High Court in ARCIC v Walsh (HC 38/96) where Justice Salmon was called upon to consider whether Regulation 11 must be read so as to provide for emergencies. He found that such an interpretation of the Regulation could not be made. At page 4 of his judgement the Learned Judge stated: "In my view the words are perfectly clear. This does not seem to me to be a case where it is appropriate to read words into the Statute such as was done by the learned District Court Judge. The principles that apply to such a case have been referred to by our Court of Appeal in R v Wall [1983] NZLR 238 at 240 and are set out in more detail in two decisions of the House of Lords. In Stock v Frank Jones (Tipton) Lid [1978] 1 WLR 231 Lord Scarman said at page 239: If the words used by Parliament are plain, there is no room for the "anomalies" test, unless the consequences are so absurd that, without going outside the statute, one can see that Parliament must have made a drafting mistake. If words "have been inadvertently used." it is legitimate for the court to substitute what is apt to avoid the intention of the legislature being defeated: per Mackinnon L.J. in Sutherland Publishing Co. Ltd v Caxton Publishing Co. Ltd [1938] Ch. 174, 201. This is an acceptable exception to the general rule that plain language excludes a consideration of anomalies, i.e. mischievous or absurd consequences. If a study of the statute as a whole leads inexorably to the conclusion that Parliament has erred in its choice of words, e.g. used "and" when "or" was clearly intended. the courts can, and must. eliminate the error by interpretation. But mere "manifest 10 absurdity" is not enough: it must be an error (of commission or omission) which in its context defeats the intention of the Act." Accordingly then, for the reason that there is no statutory power given to the Corporation to make payment by approving treatment retrospectively, this appeal must be dismissed. DATED at WELLINGTON on this /8 th day of November 1997 death M J Beattie District Court Judge Bojesen.doc(gm)