Grace v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT Decision No. / /2 195 HELD AT AUCKLAND 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 MISTY GRACE Appellant 43/ 95/ 6264 (Appeal No. DCA 43/95) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent DECISION OF JUDGE D A ONGLEY ON THE PAPERS This appeal concerned a claim for contribution to the purchase of a vehicle under Accident Rehabilitation and Compensation Insurance (Social Rehabilitation - Purchase and Modification of Vehicles) Regulations 1992 when the Corporation had already contributed to the purchase of a vehicle within the preceding five years. This appeal was called on 4 July 1995 in the District Court at Auckland. Notice had been given to the appellant's representative Ms C Wilson at the People's Centre. The response to enquiries indicated that Ms Wilson was no longer at the centre and arrangements for other representation had not been made in time, although the notice of hearing had been issued on 16 June 1995 leaving over two weeks before the hearing date. Because a proper opportunity for hearing oral argument had apparently been given, rather than deciding the appeal without receiving submissions from the appellant I directed that the appeal be heard on the papers. When filing written submissions Ms Wilson then said in a letter to the Court that she had not in fact received notice of the hearing date. No further application was made for another hearing and this decision is delivered after receiving those submissions and submissions in reply from the respondent. - 2 - The short facts as stated by the Review Officer were these. Misty Grace is now aged 17. She was seriously injured in a hit and run accident at the age of 4. In February 1991 the appellant's mother applied under the Accident Compensation Act 1982 for a suspensory loan to purchase a suitable vehicle for Misty's transport. She chose a 1983 Mitsubishi Star Wagon. It was inspected and thought to be suitable for modification for its intended purpose. The Corporation advanced $10,000 on a suspensory loan. The vehicle was purchased but it was found that suitable modifications would be very expensive and so none were carried out. It proved unreliable and Misty's parents spent a good deal of money on repairs. In 1994, when they were finding it increasingly difficult to fit Misty into the Wagon they applied to the Corporation for a contribution to an alternative vehicle. On 10 November 1994 the Corporation wrote to Misty: "I have received a letter form the solicitor at Head Office about the vehicle loan. The decision is that you may use the van as a trade in (in which case the loan could be written off) for another vehicle. The difference between the trade-in and the new vehicle would have to be covered by you and we would not be able to contribute. In addition, should the van be traded in, we would not be able to contribute towards the purchase of a new vehicle in February 1996 as you would already have one. Should you decide to trade the van in, we will be able to pay up to $5,000 for the necessary modifications. Please note that this modifications grant cannot be included in the purchase price of the car." That letter contained the Corporation's decision, although a later letter repeated or clarified the conditions restricting the Corporation's contribution. Counsel for the appellant argued, both at the review and on this appeal, that the advance made by the Corporation in 1991 for the purchase of a vehicle was not in accordance with the Act, the vehicle being unsuitable for modification. It was submitted that a consequence of the non-complying advance was that it could not be taken into account in a way that limited the power of the Corporation to make an authorised advance in 1994, or otherwise within five years of the first advance. As a general assertion that cannot be accepted. There is no evidence that the Corporation acted ultra vires or in bad faith. It simply acted on incorrect advice that the vehicle was able to be modified. The fault apparently lay with the person who furnished the advice. There is no authority for a broad proposition that the Corporation's act was therefore a nullity and must be disregarded. The answer to the question whether the Corporation has power to make a further advance within five years must be sought in the Act and the Accident Rehabilitation and Compensation Insurance Purchase and Modification of Vehicles Regulations 1992. Reg 9(4) and (5) of those regulations provides as follows: "9. Conditions of approval - .... . (4) Subject to subclause (5) of this regulation and in accordance with section 26(5) of the Act, no approval for the purchase of and modification to a vehicle shall be given by the Corporation ... where the Corporation ... - 3 - (pursuant to these regulations), or the Accident Compensation Corporation pursuant to the Accident Compensation Act 1982), has within 5 years of the date of the application for payment for the purchase of and modification to a vehicle under these regulations, contributed towards the cost of the purchase of and modification to a vehicle owned by the claimant or a person transporting the claimant. (5) The Corporation or exempt employer may given approval in respect of the purchase of and modification to a vehicle within 5 years of the purchase of and modification to a vehicle in respect of which the Corporation or exempt employer or the Accident Compensation Corporation has contributed, where the Corporation or exempt employer is satisfied that such purchase of and modification to a vehicle is necessary to ensure the claimant to obtain or maintain employment, and the purchase of an modification to a vehicle is expected to be cost-effective for the Corporation or exempt employer. (6) For the purposes of subclauses (4) and (5) of this regulation and section 26(5) (a) of the Act, each interval of 5 years shall commence on the date after the date on which either the purchase was made or the modifications were completed whichever is the later. Ms Wilson submitted that a further contribution is not prevented by r 9 because the expression "purchase of and modification" restricts the application of the regulations to cases where both a purchase and modification has occurred. That submission overlooked r 2 which defines the same expression: "Purchase of and modification to a vehicle' includes the purchase of a vehicle, the purchase of and modification to a vehicle, and modification to a vehicle" It is evident that the expression has been used deliberately in r 9 to include either purchase or modification or a combination of the two. The regulations are issued pursuant to s 26 of the Act which includes purchase of, and modifications to motor vehicles and other means of transport as an element of social rehabilitation in subsection (4). Section 26 continues: '(5) The Corporation may provide or meet the cost of modifications to residential premises or purchase of or modifications to motor vehicles in respect of any rehabilitation programme at intervals of - (a) Not more frequently than 5 years; or (b) Less than 5 years only if the Corporation is satisfied that such purchase or modifications are necessary to enable the disabled person to obtain or maintain employment, and are expected to be cost-effective for the Corporation. (6) Nothing in subsection (5) of this section shall be so construed as to oblige the Corporation to provide or meet the cost of any purchase or modifications within or outside any 5-year period. (7) No payment in respect of any item referred to in subsection (4) of this section may be made by the Corporation other than under this section. Those statutory limitations are repeated in the regulations. This is not a case where s 26(5)(b) is said to apply. Clearly the Corporation has no power to make any contribution during the five year period. Whether there is a remedy against the person who caused the error in the first place is outside the scope of this decision. This Court is limited to dealing with the short question of the Corporation's power to make a further contribution within the five year period. For the above reasons the appeal is dismissed. DATED at WELLINGTON this 41 day of October 1995 D A Ongley District Court Judge