Category: Cases

ACC v Kearney (Interest on Back-Dated Weekly Compensation)

Accident Compensation Corporation (ACC) v Robert Kearney
Court of Appeal 15 April 2010.

On 13 February 1985, Mr Robert Kearney suffered injuries to his wrist and femur in a motor accident. Because of the accident Mr Kearney was unable to return to work as a saw doctor. Mr Kearney retrained as a pastor. In 1991, ACC advised Mr Kearney that they were terminating his weekly compensation payments as he was now able to resume full time employment as a pastor.

In 2003, Mr Kearney appealed the 1991 decision. The Review Officer held that ACC had unlawfully cancelled Mr Kearney’s compensation. This was because under the 1982 act a complainant was to receive compensation if they could not do the job they held prior to injury. Because of this, Mr Kearney was awarded a backdated sum. The issue in this case was whether Mr Kearney should receive interest on this payment, and if so when should it be backdated to.

The Review Officer held that interest was payable from 19 August 2003. ACC reasoned that this was the time that they had received all information necessary to enable calculation of the payment.

Mr Kearney submitted that he believed the interest should be paid from 1 June 1992, “as and when the payments are due.”

The decision: There were concerns over whether it was s 72 of the Accident Rehabilitation and Compensation Act 1992, s 101 of the Accident Insurance Act 1998 or s 114 of the Accident Compensation Act 2001 that covered Mr Kearney’s interest payments.

The judges found that all three acts covered the payment for the years that they were in force. However, the judges stated that, “for present purposes, the three provisions [were] identical”.

Chambers J, believed these sections entitled Mr Kearney to interest from, “1 month after the Corporation…has received all information necessary to enable the insurer to calculate”, a payment. ACC stated that the date they received all information was 19 August 2003 and that this is when interest should be applied from. While Mr Kearney believed that the date interest should be charged from was 31 July 1991 when payments were ceased because at that time they had all the information they required to make payments.

Chambers J, agreed with Mr Kearney because ACC was solely to blame for Mr Kearney not receiving compensation. Chambers J, believed that in deciding how the provision should be read one must look to the intention of parliament. The judge did not believe parliament would have intended “the Corporation to be able to represent to an accident victim it (wrongly) did not need any further information, and then later be able to take advantage of that error. In short Parliament would not have envisaged a situation where the Corporation sought to benefit from its own wrong.”

Conclusion: s. 72 of the Accident Rehabilitation and Compensation Insurance Act 1992, s. 101 of the Accident Insurance Act 1998 and s 114 of the Injury Prevention, Rehabilitation and Compensation Act 2001 are substantially similar. Where ACC is at fault they should not be able to benefit from their own wrong doing.

Cases Referred to:
Accident Compensation Corporation v Broadbelt [1990] 3 NZLR 169 (CA)- interest is only payable if authorised by statute.
Unwin v Accident Rehabilitation and Compensation Insurance Corporation DC Wellington 21/97 14 February 1997 – the 1992 act can backdate interest to prior to the act.
Robinson v Accident Compensation Corporation [2007] NZAR 193 (CA) s 72 of the 1992 Act, s. 101 of the 1998 Act, and s 114 of the 2001 Act use “materially the same language”.
Salt v Governor of Pitcairn and Associated Islands [2008] NZCA 128, [2008] 3 NZLR 193- Parliament would not envisage a situation where someone could benefit from their own wrong.

ACC v Vandy (Incapacitated while Unemployed)

Accident Compensation Corporation (ACC) v Dominique Vandy
High Court Wellington November 2010

Ms Vandy, injured her hip in 2003 at the age of 12 when she fell from a horse. After leaving school she entered employment. While in this employment Ms Vandy suffered an aggravation of her earlier injury. The injury incapacitated Ms Vandy from further employment.

ACC declined Ms Vandy’s application for weekly compensation because she was not in employment at the time of injury in 2003 and therefore did not fulfil s. 103 of the act. It was ACC’s belief that for a claimant to be paid weekly compensation under the Accident Compensation Act, they must have been in employment at the time of their original incapacitation.

Decision: Gendall J, stated, that s.100 of the Accident Compensation Act is a cumulative section; For a claimant to receive weekly entitlements they must also be covered by s.103(2) and clause 32 schedule 1 of the Act. s.100 outlines who is entitled under the Act and that they must be incapacitated (“unable to engage in employment”) within the meaning of s.103 (2) of the act (“in which he or she was employed when he or she suffered personal injury”).

In light of these provisions someone may be unemployed but factually incapacitated yet they would not come within the terms of the Act. Gendall J, noted that there was unfairness in this legislation however he noted that s 37 was amended in 1993, and that at this time, including non-earners who were later incapacitated was considered as a policy option but it was not adopted.

Conclusion: Based on the legislation, the judge believed that weekly payments could not be claimed for unless the claimant had been in employment at the time of their incapacitation. The judge stated that in reading the provisions “the meaning of the statutory provisions can be interpreted in only one direction, despite understandable notions of what might be ‘fair’ in an individual case, the remedy if there is one has to be provided by parliament.

Cases Referred to: Giltrap v Accident Compensation Corporation DC Wellington 141/2006, 9 June 2006. Gendall J, affirmed this case stating that the requirements in s100 (10(a) are clearly cumulative. One is that the claimant was incapacitated within the meaning of s. 103(2). The other is eligibility under cl 32.

Bonsor v ACC

Bonsor v ACC
Wellington District Court 2010

On 1 September 2008, 67 year old Mr Garnett Bonsor tripped and fell, falling heavily on his left arm and shoulder, immediately experiencing pain in his shoulder. ACC granted cover for a left rotator cuff sprain, although the symptoms of pain and limited function continued despite treatment. It was recommended he undergo surgery, which ACC declined to fund on 17 April 2009 based on the decision of ACC’s Clinical Advisory Panel, which stated “the most likely cause for the client’s condition requiring surgery is a long standing pre-existing outlet impingement syndrome with a probable contribution from age-related intrinsic tendon degeneration”. Mr Bonsor was unsuccessful in his review of ACC’s decision, and he appealed to the District Court.

Judge Beattie found the following points persuasive:

  • The writer of the report of the Clinical Advisory Panel had not personally examined Mr Bonsor, nor had he personally examined Mr Bonsor’s x-rays.
  • Mr Bonsor had no history of pain prior to the accident, which would have been evident had there been a “long standing pre-existing outlet impingement syndrome”.
  • Mr Swan’s, Orthopaedic Surgeon, opinion the fact there was some degeneration in Mr Bonsor’s shoulder is quite normal for a shoulder of that age, which would not require surgery. There is good evidence that these kinds of changes are not necessarily symptomatic or functionally limiting.

Judge Beattie allowed the appeal, on the strength of Mr Swan’s evidence, that there was a causal link between the injury and the need for surgery, which was requested to relieve Mr Bonsor’s symptoms and repair the tear.

His honour concludes that “the Court has now heard and considered a significant number of cases on appeal where the respondent’s decision to decline to fund surgery is based essentially on the fact that the claimant’s shoulder is displaying aspects of degeneration commensurate with age.” He further states that ACC is “very quick to seize on that identified state of affairs and use it as a reason for declinature”.

As a side note, Judge Beattie also comments on the original claim for cover; although the claim was for a “left rotator cuff sprain”, His Honour concludes that GP’s are often only able to give a general diagnosis, and it is not until after an investigation examination following radiological input that a detailed identification of the injury can be established. On that basis, Judge Beattie concludes that it is open to the Court to identify, based on the medical evidence, precisely what the nature and extent of the injury suffered was. The Court is not bound to the description of the injury in the original claim.