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Accident Compensation Cases

Smith v Accident Compensation Corporation (DC, 29/01/16)

Judgment Text

Judge A N MacLean
This appeal is from a review decision of 19 January 2015 which, as the reviewer noted, arises: 
From an overpayment of weekly compensation originally received by the appellant in 2000, and 
A linked procedural issue in respect of alleged non compliance with s 137 of the Act creating a deemed decision. 
The central issue is whether or not there had been a valid application for review lodged which could in turn trigger the deemed decision provisions, then potentially leading to examination of what the actual deemed decision might be. 
The essential background facts are not in dispute and as set out in the review decision include: 
The appellant sustained multiple injuries in a motor vehicle accident in May 1998. 
He received weekly compensation until 2000 when an investigation revealed that he had been working whilst in receipt of receiving weekly compensation and had failed to advise the respondent. 
Weekly compensation ceased in October 2000. 
The appellant was prosecuted and sentenced in the District Court with the overpayment of weekly compensation being found by the Court to be $51,318.78. 
In November 2002 the respondent advised the appellant that he had an outstanding debt for that amount and stated: 
“We write to advise you that ACC is to withhold the independence allowance due to be paid to you in early December this year. ACC will continue to do so until the debt is repaid or a Court rules otherwise. If you can provide information to me that this has a significant adverse impact on your financial position then we may alter this decision. ”
There was no response to that letter. 
On 23 January 2003 the Waitakere District Court entered judgment by default for the sum of $51,517.81 which with costs and disbursements rose to $52,077.81. 
The respondent withheld entitlement until it became apparent in August 2007 that the appellant had closed his bank account and left his last known address. It seems he had gone to Ireland. 
The understanding of the respondent was that in 2014 following return to New Zealand he made enquiries through his advocate about his entitlements. In fact, in Court it was explained to me by Mr Heperi that the appellant had in fact returned from Ireland some time earlier. 
After correspondence between Mr Heperi and the respondent, an email was sent dated 3 July 2014 from the respondent to Mr Heperi stating: 
“The debt remaining has been updated. The outstanding debt was $42,944.96. As George was owed an IA arrears (for the period 27 August 2007? 17 August 2014) of $14,863.86 the balance of the debt remaining is now $28,081.28. I have requested the ongoing independence allowance payments to be raised against the debt. ”
Following receipt of that information an application for review based on the email of 3 July 2014 was submitted. For a variety of reasons, allocation of a reviewer was not made in accordance with s 137(2) of the Act until 4 December 2014 by which time the three months allowed by s 146(1)(a) had expired. 
The Appellant's Position 
Mr Heperi raised a number of points some of which can be dealt with quite shortly. However, the essential aspect of the submissions before me was the same as before the reviewer, namely that because of non compliance with s 146(1)(a) a deemed decision arose and that instead of proceeding to a review the respondent should have accepted that it was bound by a deemed decision and should repay the arrears of independence allowance. 
The submission made was that the email of 3 July 2014 was a “decision” made by ACC to withhold the arrears of weekly compensation. While it seems that before the reviewer the submission had been that it was irrelevant as to whether or not the email was a decision, by the hearing before me it was clear that the focus of the appellant is primarily on the concept of the deemed decision. 
For completeness, other points raised by the appellant include the following: 
That there was no evidence that a debt had ever been established. This can be dealt with quite shortly. Clearly there is both the criminal jurisdiction decision of the Waitakere District Court and the judgment by default, neither of which have been appealed. 
Mr Heperi also raised a question at the end of the hearing as whether the “Statute of Limitations” might have some application. This too is not an issue as Section 12(3) of the Limitation Act 2010 makes it clear that time does not run on a Judgement. 
There seemed to also some suggestion that in some way generally the procedure adopted by the respondent as a whole was unfair to the appellant with some discussion about whether he was totally aware of the reality of the Court judgments and/or had been served with the necessary papers. It is not necessary to go into that. It is quite clear from perusal of the bundle of documents that not only was a proper legal process followed with a proper legal outcome but the appellant was either aware or chose not to follow up on the implications of the Court proceedings. 
At the hearing I pressed the appellant's advocate as to precisely what outcome he was seeking and he clarified that essentially it is that the respondent should forthwith pay $14,863.86 namely the independence allowance arrears that had accrued over the period 27 August 2007 to 17 August 2014 and that some form of renegotiation should be entered into about resolving the outstanding overpayment because, while it seems that before the reviewer and at least initially before me, there was some suggestion that the total debt had no legal standing in fact that position is untenable and is not now being pursued. 
The Respondent's Position 
The respondent's primary position is that the email decision of 3 July 2004 was not a reviewable decision but essentially simply an arithmetical clarification calculation following a review of the internal book keeping procedures that had been carried out by the respondent on the basis that all contact with the appellant had been lost in or around 2007. Papers in the bundle of documents make it abundantly clear what happened, including the fact that the appellant was aware of what was going on or chose not to investigate further. 
As a fall back position the respondent's position was that if the 3 July email was a decision, in the absence of any viable alternative calculation showing the arithmetic to be wrong that there was nothing to “deem”
Analysis and Discussion 
Cases such as Howard v ACC1
| X |Footnote: 1
and Briggs v ACC2
| X |Footnote: 2
make it clear that if there is not a compliant application for review there can be no deemed decision. 
“Decision” is defined in s 6 and covers a range of determinations including whether or not there is cover, classification of an accident and the like and in subparagraphs (c), (d) and (e) decisions about provision of entitlements, what entitlements will be provided and the level of entitlement. 
It is clear that in this case the July 2014 email was none of those things. It was simply an arithmetical calculation starting with the unchallengeable proposition of a total debt of over $50,000 and then netting off accruing entitlements that whilst they had initially been written off for sound practical reasons on an internal basis, were then in effect reinstated to bring the situation back up to date. It is clearly not a decision in terms of s 6. 
Based on that interpretation of the situation there is no need to move to the question of what if any sort of deemed decision should be made because there is clearly no jurisdiction to make one. Even if there were, that would entail the appellant establishing some error in the arithmetical calculation, which he has not done, and in any event, to move from that to then directing that in the face of a still considerable debt owing to the respondent, it should nevertheless pay out over $14,000 at this stage is untenable. 
Accordingly the appeal is dismissed. There is no issue as to costs. 


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