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Accident Compensation Cases

Kuru v Accident Rehabilitation and Compensation Insurance Corporation (DC, 17/07/98)

Judgment Text

DECISION OF JUDGE A W MIDDLETON ON THE PAPERS 
Judge A W Middleton
This appeal was set down for hearing at Christchurch on 24 June 1998 when I was advised that the appellant had told the Registrar that he would not be appearing. Ms Long provided me a synopsis of the respondent's submissions which had already been provided to the appellant and the appellant had provided written submissions. Accordingly, I propose to issue a decision on the papers. 
The issue on appeal is whether the appellant is entitled to the payment of interest on the payment of earnings related compensation made to him in July 1995. 
The facts which give rise to the appeal are that while on duty as a Police Constable on 17 July 1983, the appellant suffered personal injuries in an accident when his motorcycle collided with a car. The appellant remained fully unfit for work between 17 July and 10 October 1983 and was certified fit for selected work on 11 October 1983. The respondent paid earnings related compensation for the period during which the appellant was unable to work. 
As a result of the injuries he sustained the appellant was paid lump sum compensation under the provisions of the Accident Compensation Act 1982. 
On 29 April 1991 the appellant inquired from the respondent whether he was entitled to continue to receive earnings related compensation as he had been discharged from the Police on 29 December 1987 as the hand which he had injured in the accident had not fully recovered. The respondent received confirmation from the Police that the appellant had ceased normal duties in October 1987 and had left the Police Force because of the problems arising out of his injury. On 5 September 1991 the respondent notified the appellant that it would resume payment of earnings related compensation backdated to 9 May 1991, being the date of the certificate confirming his incapacity for employment. The respondent further stated that it would not backdate the earnings related compensation beyond 9 May 1991. The appellant lodged an application for review of that decision on 30 March 1993. 
In a decision issued on 18 May 1995 the Review Officer held that the appellant was entitled to receive earnings related compensation from the date of his cessation of employment with the Police until 9 May 1991. When that decision was issued the respondent calculated the arrears and notified the appellant's solicitor that before payment could be made it was necessary to obtain confirmation from the New Zealand Income Support Service as to the amount of benefit payment that would be required to be refunded to it before it could make any payment. The respondent was notified on 6 July 1995 by Income Support Services that the net refund amounted to $44,814.24 for benefit paid to the appellant between 29 December 1987 and 8 May 1991. On 17 July 1995 the respondent notified the appellant of the amount which would be paid and full arrears were paid on 18 and 19 July 1995. On 17 July 1995 the appellant inquired whether he was entitled to interest on the arrears which he had received in July 1995. On 18 July 1997 the respondent notified the appellant that as it was unable to assess the amount due to him until it had received the information from New Zealand Income Support Service on 6 July 1995 and had made the correct payment to him, within one month from that date, the respondent was not obliged to pay interest under section 72 of the Accident Rehabilitation and Compensation Insurance Act 1992. The appellant applied for a review of that decision and the Review Officer held that the respondent's decision was correct. It is against that decision which the appellant now appeals. 
The appellant has submitted that the principal reason for leaving the Police Force was the condition of his right hand and wrist following the accident. The appellant submitted that when he had discussed arrears with his solicitor the solicitor had indicated that the amount of earnings related compensation together with interest would be considerable as a result of which the appellant sold his house in order to pay the solicitor a retainer in order to handle his case. He said that as a result of the solicitor being involved, he was found to be entitled to payment of earnings related compensation between December 1987 and May 1991. The appellant considers that the strain of pursuing the claim caused him to be hospitalised. The appellant submits that the respondent had failed in its duty by not paying earnings related compensation in 1988 thus making him reliant on New Zealand Income Support Service. He submitted that the respondent should have been aware of its commitment to him. He submitted that he considers he has suffered inhuman treatment. 
The respondent's submissions are that while the earlier review found that the appellant was entitled to the payment of earnings related compensation for the period between December 1987 and May 1991, that was a decision made in relation to the provisions of the Accident Compensation Act 1982. That a similar position arose in the appeal in SB (105/96) in which this Court held that entitlements under the 1982 Act did not constitute weekly compensation under the 1992 Act which might entitle that appellant to payment of interest pursuant to section 72 of the 1992 Act. The 1982 Act makes no provision for the payment of interest and the Court should therefore follow the decision in SB and decline the appeal. 
While it is clear that the appellant has been upset by the process through which he had to go in order to obtain reinstatement of earnings related compensation from the date of his disengagement from the Police Force, the issue before me is whether that entitlement also includes an entitlement to the payment of interest. As I have said there is no provision in the Accident Compensation Act 1982 by which the respondent can be required to pay interest on any outstanding entitlements. Section 72 of the 1992 Act states: 
“72.
Payment of interest where Corporation or exempt employer makes late payment of compensation based on weekly earnings--- 
Where any payment of compensation based on weekly earnings to which a claimant is entitled is not paid by the Corporation within 1 month after the Corporation has received all information necessary to enable calculation of the payment, interest shall be paid on the amount payable by the Corporation at the rate for the time being prescribed by or for the purposes of section 87 of the Judicature Act 1908 from the date on which payment should have been made to the date on which it is made. ”
As I have mentioned in relation to the respondent's submissions, the Court held in the appeal of SB that earnings related compensation paid under the 1982 Act are not “weekly earnings” assessed under the 1992 Act and that there is therefore no entitlement to payment of interest on that amount. Alternatively, if that is not the situation, I agree with the respondent's submission that immediately upon it ascertaining the amount required to be refunded to New Zealand Income Support Service the respondent paid the balance due to the appellant within the period of one month as is required under section 72 of the 1992 Act. 
The position then is that under the 1982 Act the respondent does not have the power to pay interest. If I am wrong in holding that the principle enunciated in SB apply then I hold that because the respondent complied with the requirement of section 72 of the 1992 Act, to pay the appellant his full entitlement within one month of it receiving all the information necessary to make the calculation then the appellant is not entitled to interest under that section. 
The appeal is dismissed. 

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