The Motor Accident Injuries Act 2017 commences operation on 1 December 2017.
There are two types of payment regimes for persons making a claim for injuries suffered in a motor vehicle accident in the use of or operation of a vehicle on a road in New South Wales.
The two regimes are a claim for “statutory benefits” or a claim for “damages”.
Statutory benefits are payable whether there is fault or not, such payments include weekly payments for total or partial loss of earnings and benefits for treatment and care including gratuitous domestic duties.
An injured person is not entitled to statutory benefits if compensation under the Workers Compensation Act 1987 is payable to the injured person in respect of the injury concerned. (Expect more claims to be made to worker’s compensation insurers in respect to such injuries ).
There is a provision which states that insurers under this act and the Worker’s Compensation Act 1987 “may exchange information for the purpose of facilitating the proper operation of this section”. There is no specific provision providing for reimbursement by the worker’s compensation insurer to the CTP insurer for statutory benefits payments made by the CTP insurer up to the date of the Workers Compensation Insurer takes over the claim management. (Keep an eye out for requests for reimbursement which ought to be rejected without a legal basis supporting the claim for reimbursement).
“Damages” is defined as “means damages (within the meaning of the Civil Liability Act 2002) in respect of the death or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of a vehicle, but does not include a statutory benefit.”
The only damages that may be awarded are:
(a) Damages for economic loss as permissible by Division 4.2 and
(b) Damages for non-economic loss a permitted by Division 4.3.
No damages may be awarded to an injured person if the person’s only injuries resulting from the motor accident were “minor injuries”.
Minor injuries are defined as:
(a) A soft tissue injury,
(b) A minor psychological or psychiatric injury.
No damages for non-economic loss may be awarded in respect of an injury unless the degree of impairmentof the impaired person as a result of the injury, caused by the motor accident is greater than 10%.
The maximum damages for non-economic loss is $520,000.
Contributory negligence – the common law and enacted law as to contributory negligence apply to an award for damages in respect to a motor vehicle accident, except as provided specifically in the Act, including as to, for example, “drink driving, etc.”, where mandatory contributory negligence will be applied.
A claim for damages by an injured person cannot be settled within two years after a motor vehicle accident unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%. (Query if the provision will be relevant to a court hearing a recovery claim within two years of the date of the accident in circumstances where the 10% threshold has not been reached).
It appears that, whereas in the past, claims for indemnity could have been made for minor injuries, they no longer can – as the “damages” amount up to which indemnity can be sought will be $0 as “statutory benefits” are specifically defined as not being “damages”.
The damages regime is also more restrictive in terms of allowable heads of damage and limitations in calculating such damages. Accordingly, it is now more likely that the indemnity sum will be less than the total amount of workers compensation payments made, and by greater margin.
There are specific requirements for cooperation between Workers Compensation Insurers and CTP Insurers. In the spirit of that cooperation, during the initial period after 1 December 2017, care ought to be taken to ensure that Workers Compensation Insurers rights to indemnity are appropriately enforced and “grey areas” clarified through clear thinking Claims Managers based on expert legal advice.
The expert 151Z Indemnity Team at Hicksons would be glad to provide any assistance which may be needed to ensure that compliance is made with icare’s requirements moving forward.
Post by Murray Pacemski