Furness v Accident Rehabilitation and Compensation Insurance Corporation

Decision No: 16/ 95 IN THE DISTRICT COURT DCA No. 37/94 HELD AT AUCKLAND UNDER The Accident Rehabilitation and Compensation Insurance Act 1992 AND 49-94+ 1235 IN THE MATTER of an appeal pursuant to Section 91 of the Act BETWEEN NEIL HENRY FURNESS APPELLANT AND THE ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION RESPONDENT Date of Hearing: 25 October 1994 Date of Decision: 21 February 1995 Counsel: Appellant in person Pauline Zumbach for the respondent RESERVED DECISION OF JUDGE J.H. LOVELL-SMITH The issue in this appeal is whether the appellant is entitled to receive weekly compensation. 2. The appellant suffered personal injury by accident on 30 July 1993 when he was struck by a motor car while riding his motor cycle. He fractured his right thigh bone. At the time he was a trainee teacher. The appellant applied for loss of earnings and his application was in terms of "a loss of potential earnings benefits". On 19 August 1993, the appellant wrote to the Corporation as follows:- "I have not been able to do any form of employment. I am a student and was intending working part-time to help support my wife and our five children. My wife works part-time as a nurse." A client officer at the Corporation's Auckland branch had noted that the appellant's student allowance had been stopped because his wife earned in excess of $12,000 per annum. The Corporation declined to change its decision under s.46 of the 1992 Act. The appellant was advised in writing by the respondent on 25 August 1993 that he was not entitled to receive weekly compensation benefits. The appellant applied for a review on the grounds that he was no longer receiving the student allowance and he needed to work part-time to supplement his wife's part-time income in order to support their family. At the review hearing, the appellant emphasised that the accident was not his fault but as a result he had suffered considerably. He had been a Telecom technician and had been made redundant. Because his wife earned over $11,800 he could no longer receive the student allowance, and he had used 3. that money to pay his mortgage. He was not able to apply to the Department of Social Welfare for a sickness benefit. The Review Officer concluded that the provisions of s.46 of the Act did not apply to the appellant because of his age. Further, that s.44 of the Act had no application to the appellant. The application for review was unsuccessful. The relevant sections in the Accident Rehabilitation and Compensation Insurance Act 1992 are as follows:- "37. Test of incapacity - For the purposes of this Part of this Act, whether or not a person to whom this Act applies is incapacitated shall be determined by whether or not the person is, by reason of his or her personal injury, for the time being unable to engage in employment in which the person was engaged when the personal injury occurred or, where any of sections 44, 45, 46, or 49 of this Act applies, any other employment for which the person is qualified by reason of experience, education, or training, or any combination of them. 39. Compensation for loss of earnings payable to earners for incapacity generally - (1) The weekly compensation for loss of earnings payable to an earner who is incapacitated as a result of personal injury in respect of any period to which section 38 of this Act does not apply is 80 percent of the earner's weekly earnings. (2) The compensation for loss of earnings payable under this section shall be paid by the Corporation. 4. 44. Extension of entitlement to compensation for loss of earnings - (1) Where a person has ceased to be a employee, the person shall be deemed to continue to be an employee for the purposes of this Part of this Act if (a) The person had been an employee within 14 days before the commencement of the incapacity; and (b) The person had been an employee for a continuous period of not less than 12 months immediately before that 14-day period; and (c) But for the incapacity, the person would have been an employee within 3 months after the commencement of the incapacity. 46. Compensation for loss of potential earning capacity payable to person in respect of incapacity resulting from personal injury suffered before attaining 18 years or age or while studying - (1) Compensation for loss of potential earning capacity shall be payable in respect of a person who - (a) Suffered personal injury before attaining the age of 18 years or while engaged in full- time study or training which has been continuous since before the person attained the age of 18 years; and (b) Has attained the age of 18 years and is incapacitated by that personal injury; and (c) In any case where that person's degree of incapacity has been determined under 5. section 51 of this Act, has a capacity for work of less than 85 percent as determined in accordance with the scales prescribed by regulations made under this Act; and (d) Does not have weekly earnings in excess of $245 [248.36] or, in the case of a person who has not attained the age of 20 years, does not have weekly earnings in excess of $196 [198.69]; and (e) Is not engaged in full-time study or training; and (f) Has been incapacitated for more than 6 months." No C15 medical certificate had been issued confirming that the appellant is unfit for work or fit for selected work only. Ms Zumbach submitted the appellant did not meet the test of incapacity for the purpose of s.37 as there was no indication on the file as to exactly when the appellant was "incapacitated". She contended that it could not be said that he was incapacitated from the date of injury on 30 July 1993 because he was apparently able to continue at Teacher's College until the end of the educational year. The appellant produced a letter from Dr Richard Stirling, a general practitioner, dated 25 October 1994:- "I support Mr Furness in his appeal over compensation for his fractured right neck femur of 30 July 1993, ACC-H539474. His hip causes on-going pain at times in his sleep and on first 6. moving around in the morning. He needs to use rails on steps and cannot run now. This latter is significant in a teacher who has hoped to major in physical education and has been a keen sports coach. His interest is bee keeping is rendered difficult in needing assistance with lifting now." There is no doubt that the appellant's life has changed as a result of the accident through no fault of his own. He was a sportsman intending to be a physical education teacher before the accident. This career is no longer open to him as a result of his injury. He has difficulty pursuing his interest in bee keeping. After the injury he continued at Teachers College but in pain and on crutches. He finds it "incredible" that he should be disadvantaged because of his age. The Review Officer took the date of injury as the alleged date of incapacity. Ms Zumbach, for the respondent concluded that this was for the sake of convenience. On that date the appellant was a trainee teacher in receipt of a student allowance. According to the evidence it was apparent that the appellant was able to continue as a trainee teacher notwithstanding his injury. It therefore could not be said that the appellant was by reason of his personal injury, for the time being unable to engage in employment in which he was engaged when the personal injury occurred. Student allowances are specifically excluded from the definition of "earnings" and Earnings Definitions Regulations which provide that earnings as an employee does not include any student allowance. Ms Zumbach contended it could not be said that the appellant has a loss of earnings in terms of s.39. In her view at the date of the appellant's alleged incapacity he was not in receipt of "earnings as an employee". 7. Furthermore, the appellant had not been an employee within fourteen days before the commencement of the incapacity, nor had he been an employee for a continuous period not less than twelve months immediately before the period of incapacity, nor, but for the incapacity, would he have been an employee within three months after the commencement of the incapacity . Ms Zumbach further submitted that s.46 of the compensation of loss of potential earnings has no application to the appellant as the provisions in subsection (1) are cumulative. The appellant must have suffered his personal injury before attaining the age of eighteen years or while engaged in full-time study or training which had been continuous since before the person attained the age of eighteen years as a first requirement for cover under this section.. As the appellant was 45 when he suffered his injury, that section has no application to him. I agree with the respondent's decision of that the appellant does not meet the test of incapacity. At the date of injury, which I accept was the date of incapacity, the appellant was a trainee teacher in receipt of a student allowance and student allowances are specifically excluded from the Earnings Definitions Regulations. At the date of his incapacity the appellant was not in receipt of "earnings as an employee". Section 44 does not apply because the appellant had not been an employee of Telecom within fourteen days before the commencement of the incapacity, nor had he been an employee for a continuous period not less than twelve months immediately before the period of incapacity, so but for the incapacity would he have been an employee within three months before the commencement of the incapacity. 8 . Section 46 which refers to compensation for loss of potential earning capacity suffered before attaining eighteen years of age or while studying. I agree that s. 46(1)(a) excludes the appellant because of his age. The appeal is therefore dismissed. There will be no order for costs. (Jane H. Lovell-Smith) District Court Judge