No MAS Certificate Required in 151Z Claims by Michael Lamproglou | May 2006
On 26 April 2006, the NSW Court of Appeal handed down its decision in Fuller v K & J Trucks (2006) NSWCA 88. The Court considered the relevance of the Medical Assessment Service (“MAS”) under the Motor Accidents Compensation Act 1999 (NSW) (“MACA”) in the context of a claim for indemnity under Section 151Z of the Workers Compensation Act 1987 (NSW) (“WCA”). The decision is a win for workers compensation insurers and their insureds and will undoubtedly have a significant impact on the outcome of many recovery claims.
Facts Christopher Kearney (“the worker”) was injured in a motor vehicle accident on 19 April 2000 while riding his motorcycle home from work. The worker was travelling along a dirt road when his motorcycle collided with a four-wheel-drive vehicle travelling in the opposite direction. The worker’s employer, K & J Trucks, paid workers compensation to the worker. The worker did not bring proceedings against Mr Fuller (“the defendant”) claiming damages; if he had done so, his claim would have been regulated by the MACA. K & J Trucks brought proceedings against the defendant seeking an indemnity under Section 151Z(1)(d) of the WCA in respect of the compensation paid to the worker. The claim was heard in the District Court by Judge Sidis who found in favour of K & J Trucks. Critical to the decision was a finding that the worker’s notional damages (the theoretical amount he would have received had he sued the defendant) included a component for Non-Economic Loss. As K & J Trucks’ claim for indemnity was limited to the amount of the notional damages, this allowed the employer to recover a greater amount of its workers compensation payments.
Evidence In order to establish a notional entitlement to Non-Economic Loss damages, K & J Trucks relied on a report of Dr Ashwell who assessed the worker as having a 23% whole person impairment (“WPI”). No other evidence on the issue was tendered and Judge Sidis accepted the assessment.
Appeal The defendant appealed on the basis that Judge Sidis had incorrectly allowed a Non-Economic Loss component in the notional assessment of damages, in the absence of a MAS Certificate stating that the worker suffered a WPI of greater than 10%.
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The Decision Justice Bryson, with whom Justices Handley and Ipp agreed, found that: •
The medical assessment process under Part 3.4 of the MACA applies only to a claim for damages by a worker.
•
The absence of a MAS Certificate under Section 131 of the MACA does not preclude an allowance for Non-Economic Loss in the notional assessment of damages in the context of a claim for recovery under Section 151Z(1)(d) of the WCA.
Implications The decision represents a significant breakthrough for workers compensation insurers. The inaccessibility of the Motor Accidents Authority’s assessment process and the absence of a MAS Certificate will no longer restrict the pool of notional damages from which compensation is recoverable. In light of the decision, it is now imperative that workers compensation insurers obtain an assessment of WPI in accordance with the American Medical Association Guidelines to Permanent Impairment 4 (“AMA 4”) to support recovery claims.
For more information please contact: Michael Lamproglou Senior Associate T: 02 8257 5723 michael.lamproglou@turkslegal.com.au
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