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Accident Compensation Cases

Knight v Accident Compensation Corporation (DC, 30/09/16)

Judgment Text

RESERVED JUDGMENT OF JUDGE L G POWELL 
Judge L G Powell
[1]
The present appeal involves a transport for independence claim made by the appellant, Laraine Knight, in March 2015, and declined by the Corporation on 5 June 2015. 
[2]
Ms Knight's 2015 claim was not the first time she had sought transport assistance from the Corporation. A 1990 application resulted in a contribution of $1,000 towards the purchase of an automatic vehicle after an assessment had identified that “an automatic vehicle would be far more suitable considering [her] injury than the manual vehicle [she] currently own[s]”
[3]
Likewise, in 2006 Ms Knight sought further assistance, this time for the Corporation to reimburse her costs of upgrading to a 2001 Mitsubishi RVR. An assessment carried out by Jeannet Penney on 28 June 2006 confirmed Ms Knight had a range of injury related needs which required her to have a vehicle with: 
A seat height of 64 centimetres. 
Automatic transmission. 
Power steering. 
Electrics, central locking. 
[4]
As those requirements were met by Ms Knight's previous vehicle (a 1996 Mitsubishi RVR) the 2006 application for assistance was declined, although at mediation following an application for review the Corporation subsequently contributed an ex gratia payment of $10,500 towards Ms Knight's purchase of her new vehicle. 
[5]
Ms Knight's present request for transport assistance was commenced with an email from Ms Knight on 17 March 2015 which, among a range of matters stated: 
“I need to know how much ACC will pay for me to get a newer car as my present is 14yrs old and I will NOT get another WOF as rust has formed on the part of the chassis that stops the motor from falling out - and don't you dare tell me I need an assessment as what I need is a better car that will enable me to carry a wheel chair plus luggage etc and I need it now!!! 
I have the choice of 2 — both 2014 with under 1,000 genuine ks I need an answer today as to how much I can spend so that my children can bring it up here from Auckland over Easter Weekend — (please). ”
[Emphasis in original] 
[6]
Further emails followed between Ms Knight and Stacey Townshend, a team manager for the Corporation who at the time was standing in as Ms Knight's case manager. In the course of this corrspondence Ms Knight advised that: 
“I need ACC approval A.S.A.P. for payment of a car that I have fond that suits my requirements i.e. my back problems and the need to take a wheelchair everywhere. 
The car I have chosen is a 2014 KIA automatic 5 door hatch almost identical to the 2001 Mitsubishi RVR I have at present which will NOT get another warrant; and 
a)
I must have a reliable and safe car to drive; and 
b)
As you are aware, the 1982 legislation allows for ACC to pay for a reliable and safe vehicle; and 
c)
I need it now. ”
[Emphasis in original] 
[7]
Ms Townshend arranged for a transport for independence assessment to take place, with the assessment undertaken by David Peacock, occupational therapist, completed on 22 May 2015. Mr Peacock confirmed that Ms Knight required “a vehicle with the following design features … that would meet [her] assessed injury related needs”
“a)
Automatic transmission 
b)
Power steering 
c)
Medium seat base height (minimum of 600mm from the ground) for ease of vehicle transfers 
d)
Flat, level entry boot cavity (i.e. absence of boot lip or recess) 
e)
External rear view mirrors ”
[8]
Mr Peacock also commented: 
“In 2006 ACC contributed to the retrospective purchase of Lorraine's 2001 Mitsubishi RVR with automatic transmission. Lorraine complete a Transport for Independence assessment the same year which indicated she was safe to drive this vehicle with respect to her injury related limitations. 
Lorraine advised the assessor that she sold the 2001 Mitsubishi RVR approximately 3 weeks ago. She declined to disclose the dollar amount that it sold for, but did indicate she had been quoted between $1000-$1800 as trade in value. Lorraine advised the assessor that she is currently reliant on friends to provide access to provide transport and achieve community access. 
Lorraine reported that her 2001 Mitsubishi RVR was no longer suitable for the following reasons: 
It was becoming more expensive to maintain and repair due to overall age and condition 
It may not have passed the next Warrant of Fitness (WoF) as there was no spare tyre and it needed three replacement tyres. ”
[9]
Mr Peacock concluded his report by noting that there were issues with the boot height of Ms Knight's preferred KIA Cerato which may have meant it was not suitable given her injury related needs. He then noted he had advised Ms Knight: 
“▪
Financial assistance towards the purchase of a vehicle would be at ACC's discretion. 
She may be required to submit a record of vehicle maintenance and a comprehensive report outlining the mechanical condition of the 2001 Mitsubishi RVR prior to the sale. ”
[10]
After subsequently clarifying with Mr Peacock that the vehicle design features he identified could “be found on some factory standard vehicles” Ms Townshend wrote to Ms Knight on 5 June 2015 declining her application and advising in particular: 
“Your current need for a vehicle appears primarily non-injury related and rather reflects a generic need for transportation. While you have some mobility considerations (for example your use of a wheelchair and limited mobility with your left knee) these do not reflect injury related needs and the Transport for Independence Report we obtained identified that a standard vehicle will meet your needs. ACC can only consider the funding of a vehicle when there is both a need and this need is due to a covered injury. 
Additionally, we're unable to approve your application because the vehicle which you disposed of was meeting your injury related needs. Both the assesssor and yourself have confirmed this. 
You asked me to provide the relevant sections of the Act, these follow: 
Accident Compensation Act 1001, schedule 1, part 1 clause 22(1)(b): 
The Corporation is not required to purchase, or contribute to the purchase of a motor vehicle if the claimant, or person proposing to transport the claimant disposed of a vehicle, after the claimant's personal injury, that may have been able to be modified in order to assist in restoring the claimant's independence. 
Accident Compensation Act 2001, schedule 1, part 1 clause 22(2)(b) 
The Corporation is not required to meet the cost of maintenance or repair of a vehicle or modification to a vehicle, or registration, insurance, or other running costs. ”
[11]
Mr Knight challenged the decision but it was upheld at review, and Ms Knight has now appealed. 
Transport for Independence 
[12]
The vehicle sought by Ms Knight comes within the definition of ‘transport for independence’ defined in clause 12 of Schedule 1 to the Accident Compensation Act 2001 as being: 
transport for independence— 
(a)
means assistance with the cost of, for example,— 
(i)
escorted travel by vehicle: 
(ii)
modifying a vehicle: 
(iii)
purchasing a vehicle: 
(iv)
travelling by public transport: 
(v)
travelling by taxi; and 
(b)
includes driver's licence retraining, for a claimant who previously had a driver's licence. ”
[13]
Transport for independence forms one of the eight categories known as “the key aspect of social rehabilitation” in terms of s 81(1) of the Act. Section 81(3) provides that the Corporation is liable to provide a key aspect to social rehabilitation to a claimant if the conditions in s 81(4) are met. Those conditions are that: 
“81
Corporation's liability to provide key aspects of social rehabilitation 
 
(4)
The conditions are— 
(a)
a claimant is assessed or reassessed under section 84 as needing the key aspect; and 
(b)
the provision of the key aspect is in accordance with the Corporation's assessment of it under whichever of clauses 13 to 22 of Schedule 1 are relevant; and 
(c)
the Corporation considers that the key aspect— 
(i)
is required as a direct consequence of the personal injury for which the claimant has cover; and 
(ii)
is for the purpose set out in section 79; and 
(iii)
is necessary and appropriate, and of the quality required, for that purpose; and 
(iv)
is of a type normally provided by a rehabilitation provider; and 
(d)
the provision of the key aspect has been agreed in the claimant's individual rehabilitation plan, if a plan has been agreed. ”
[14]
In terms of s 81(4)(a), s 84 of the Act provides that the following matters are to be taken into account in any assessment or reassessment: 
“84
Assessment and reassessment of need for social rehabilitation 
 
(4)
The matters to be taken into account in an assessment or reassessment include— 
(a)
the level of independence a claimant had before suffering the personal injury: 
(b)
the level of independence a claimant has after suffering the personal injury: 
(c)
the limitations suffered by a claimant as a result of the personal injury: 
(d)
the kinds of social rehabilitation that are appropriate for a claimant to minimise those limitations: 
(e)
the rehabilitation outcome that would be achieved by providing particular social rehabilitation: 
(f)
the alternatives and options available for providing particular social rehabilitation so as to achieve the relevant rehabilitation outcome in the most cost effective way: 
(g)
any social rehabilitation (not provided as vocational rehabilitation) that may reasonably be provided to enable a claimant who is entitled to vocational rehabilitation to participate in employment: 
(h)
the geographical location in which a claimant lives: 
(i)
in the case of a reassessment,— 
(i)
whether any item that the Corporation provided for the purposes of social rehabilitation is in such a condition as to need replacing: 
(ii)
changes in the claimant's condition or circumstances since the last assessment was undertaken. ”
[15]
Likewise in terms of s 81(4)(b) the relevant clauses for the purposes of a decision on Transport for Independence are clauses 21 and 22 of Schedule 1 to the Act and these provide: 
“21
Transport for independence: matters to which Corporation must have regard 
(1)
In deciding whether to provide or contribute to the cost of transport for independence, the Corporation must have regard to— 
(a)
any rehabilitation outcome that would be achieved by providing it; and 
(b)
the cost, and the relevant benefit, to the claimant of the transport for independence service for which the claimant has lodged a claim; and 
(c)
the difficulties faced by the claimant in doing the following in relation to the transport used by the claimant before his or her personal injury, without the transport for independence service for which he or she has lodged a claim: 
(i)
driving or operating the vehicle: 
(ii)
gaining access to the vehicle: 
(iii)
enjoying freedom and safety of movement in the vehicle: 
(iv)
travelling as a passenger in the vehicle: 
(v)
transporting any essential mobility equipment in the vehicle; and 
(d)
the need for the claimant to own or have access to a vehicle, having regard to the times at which and the frequency with which the claimant is likely to need that form of transport; and 
(e)
alternative means of transport available to the claimant; and 
(f)
the effect that modifications, or purchase, of a vehicle will have on the likelihood of the claimant obtaining and retaining employment; and 
(g)
the existing vehicle or vehicles owned or used by the claimant; and 
(h)
whether and when the limitations caused by the claimant's personal injury are expected to improve; and 
(i)
any plans and quotes an appropriately qualified person provides for proposed modifications to, or for the purchase of, a vehicle. 
(2)
The Corporation may require the claimant to satisfy the Corporation of the matters set out in subclause (3) or subclause (4) before the Corporation approves the modification or purchase for which the claimant has lodged a claim. 
(3)
The Corporation may require the claimant to satisfy the Corporation that a vehicle will be modified in such a way that it— 
(a)
will be able to be issued with a warrant of fitness; and 
(b)
will— 
(i)
comply with regulations made under the Transport (Vehicle Standards) Regulations 1990; or 
(ii)
comply with any alternative standards prescribed under regulation 6 of those regulations; or 
(iii)
be issued with an exemption under those regulations. 
(4)
If a claimant wishes to drive a modified or newly purchased vehicle, the Corporation may require the claimant to satisfy the Corporation that he or she is likely to be able to drive the vehicle safely, and be legally permitted to drive it. 
22
Transport for independence: rights and responsibilities 
(1)
The Corporation is not required to purchase, or contribute to the purchase of, a motor vehicle if the claimant, or a person proposing to transport the claimant,— 
(a)
owns or part owns or has the use of a vehicle that may be modified in order to assist in restoring the claimant's independence; or 
(b)
disposed of a vehicle, after the claimant's personal injury, that may have been able to be modified in order to assist in restoring the claimant's independence. 
(2)
The Corporation is— 
(a)
not liable— 
(i)
to ensure that the claimant pays any person that sells the vehicle or undertakes the modifications; or 
(ii)
to pay that person directly, if the claimant does not pay: 
(b)
not required to meet the cost of maintenance or repair of any vehicle or modification to a vehicle, or for registration, licensing fees, insurance, or other running costs: 
(c)
not required to meet the cost of removing any vehicle modifications no longer required or for restoring any vehicle to its former state: 
(d)
not liable for any loss of resale value resulting from modifications to any vehicle: 
(e)
not required to contribute to the cost of replacing a vehicle for whose purchase or modification the Corporation has already contributed, unless the replacement is necessary for the claimant to maintain independence: 
(f)
not required to contribute to a replacement under paragraph (e) if the claimant's need for a replacement vehicle arises because the claimant— 
(i)
has not maintained or insured the existing vehicle; or 
(ii)
has, without a reasonable excuse, disposed of the existing vehicle. 
(3)
In determining the amount to be paid in respect of a vehicle, the Corporation may take into account the value of any other motor vehicle owned by the claimant, if the claimant previously used the vehicle on a regular basis. 
(4)
The Corporation must— 
(a)
make payments for the purchase of, or modification to, a vehicle to the claimant, unless the claimant requests otherwise; and 
(b)
make the payment by way of an outright grant. 
(5)
The Corporation is not entitled to recover any payment made to the claimant if— 
(a)
the claimant no longer requires the vehicle modifications; or 
(b)
the vehicle is disposed of or destroyed. ”
[16]
Finally, with regard to the decisions made by the Corporation, as such decisions made under the social rehabilitation provisions of the Act involve the Corporation exercising its discretion, the case law is well established (particularly in the Supreme Court decision of K v B1
| X |Footnote: 1
[2010] NZSC 112 
) that the exercise of the Corporation's discretion can only be challenged where the Corporation has made an error of law, has failed to take into account some relevant matter, has taken into account an irrelevant matter, or the decision was plainly wrong. 
The Case for the Corporation 
[17]
Ms Becroft for the Corporation submitted the Corporation's decision was correct. First, it was Ms Becroft's submission that there was no obvious injury related need for a particular vehicle “that would distinguish [Ms Knight] from anyone of the non-injured general population” and that as a result Ms Knight's request “has as such been inappropriately directed at the Corporation”
[18]
Ms Becroft's second submission was that because Ms Knight had disposed of her previous vehicle prior to the assessment the Corporation was not required to provide a further contribution. In particular: 
“[Ms Knight] did so because she believed that the vehicle was at the end of its economic life. The problem though with that disposal is that it meant that the assessor was not in a position where he could consider the suitability of the vehicle, or indeed the question of whether the vehicle was at the end of its economic life. The Corporation was then in a position that it could not be certain that the vehicle had reached the end of its economic life. In those circumstances, it is submitted that the Appellant's need for a new vehicle now arises because she disposed of her existing vehicle without a reasonable excuse (as per clause 22(f)(ii)). Even if the Appellant believed that her vehicle was at the end of its economic life, it seems unreasonable for her to dispose of the vehicle, thereby preventing the Corporation from considering that issue, three weeks prior to the vehicle assessment being undertaken. ”
Discussion and Analysis 
[19]
The starting point for my analysis are the terms of the Corporation's decision set out at [10] above. It is immediately apparent that the Corporation's decision is internally inconsistent. On the one hand Ms Townshend stated, consistent with Ms Becroft's submission at the hearing before me, that Ms Knight had no injury related needs while at the same time noting in the second part of the Corporation's reasons for its decision “the vehicle which [Ms Knight] disposed of was meeting [her] injury related needs”
[20]
It can in fact not be disputed that Ms Knight has been assessed as having injury related needs. As even the brief summary set out above makes clear assessments in both 1990 and 2006, as well as Mr Peacock's assessment in 2015, concluded Ms Knight had injury related needs, and there is in fact no contrary evidence before the Court to undermine any of these assessments. 
[21]
Likewise the suggestion made by Ms Townshend that “a standard vehicle will meet [Ms Knight's] needs” is quite irrelevant to the Corporation's decision-making process. In many cases no modifications to vehicles will be necessary when the injury related need can be addressed through provision of or contribution to a vehicle with automatic transmission, power steering, seat height and/or appropriate storage space, and indeed this was Mr Peacock's conclusion in this case. 
[22]
Taken together it is clear that the first part of the Corporation's decision was clearly wrong. 
[23]
Similar problems apply to the second part of the Corporation's decision that the Corporation could not approve Ms Knight's application “because the vehicle which [she] disposed of was meeting [her] injury related needs”. The fact that a claimant has an existing vehicle, whether contributed to by the Corporation or not, is not in any way an absolute barrier to the Corporation contributing Transport for Independence assistance. Instead it is a matter for both the assessor and the Corporation to consider. Specifically pursuant to s 84(4)(i)(i) of the Act an assessor is required to consider in the case of a reassessment “whether any items that the Corporation provided for the purposes of social rehabilitation is in such a condition as to need replacement”. Likewise the Corporation in making a decision on transport for independence is required to “have regard to … existing vehicles”2
| X |Footnote: 2
Clause 21(1)(g) 
while clause 22(2)(e) confirms that a replacement vehicle “for whose purchase or modification the Corporation has already contributed” can be provided if “the replacement is necessary for the claimant to maintain independence”
[24]
The specific references in the decisions to clause 22(1)(b) and 22(2)(b) also do not assist the Corporation. As set out at [15] above, clause 22(1)(b) relates to the disposal of a vehicle “after the personal injury” which “may have been able to be modified in order to assist in restoring the claimant's independence”. There is no suggestion in the evidence that modifications were either contemplated or necessary to Ms Knight's previous vehicle, given in its unmodified form it was meeting Ms Knight's needs. Instead the subclause appears to be directed at claimants who dispose of a car that, following an injury, is no longer suitable when modifications could address the suitability of issues. Such considerations are however clearly not relevant in this case, given Ms Knight had purchased the car in question long after her injury in order to meet her injury-related needs. Likewise the second specific subclause mentioned in the decision, clause 22(2)(b) does no more than confirm that the responsibility for the costs of a vehicle rest with a claimant like Ms Knight, which is neither disputed nor relevant in the present case. 
[25]
The second limb of Ms Becroft's submission and in particular her reliance upon clause 22(2)(f)(ii) (which was not mentioned in the decision) raises more serious issues, that the Corporation is “not required to contribute [to] a replacement vehicle if the need … arises because the claimant … has, without a reasonable excuse disposed of the existing vehicle”. As Ms Becroft submitted the fact Ms Knight disposed of the vehicle prevented the Corporation from considering either whether the vehicle was at the end of its economic life, or whether the vehicle had to be replaced because it had not been maintained by Ms Knight.3
| X |Footnote: 3
Clause 22(2)(f)(i) 
 
[26]
The problem with this submission is that it was not the basis upon which the Corporation made its decision and that there is instead no evidence that the Corporation through Ms Townshend considered clause 22(2)(f) at all. Quite clearly in determining whether Ms Knight had a “reasonable excuse” for selling the vehicle the Corporation would have to form a view as to whether her view that her existing vehicle had been too expensive to maintain and would not have got another warrant of fitness amounted to a reasonable excuse for disposing of the vehicle at that point. In determining that issue the Corporation could, as Mr Peacock noted, have required Ms Knight to provide evidence of the maintenance undertaken and/or a report on the condition of the car prior to its disposal, but no attempt appears to have been made to obtain such information from Ms Knight. 
[27]
It follows that the second limb of the Corporation's decision is also deficient. Taken together I am therefore satisfied that the Corporation's decision is both clearly wrong and failed to correctly apply the statutory framework. As a result the appeal must be allowed. 
Decision 
[28]
The appeal is allowed. The review decision dated 23 December 2015 is quashed and the Corporation's decision of 5 June 2015 set aside. The Corporation is directed to reconsider Ms Knight's application on the basis that Mr Peacock clearly identified that Ms Knight had injury related needs, while paying particular regard to the matters set out in clauses 21 and 22 (and clause 22(2)(e) and (f) in particular) before issuing a new decision, which will have fresh review rights. 
[29]
Ms Knight is also entitled to a contribution to her costs to the extent that these have been incurred, as well as payment of her and Mr Reilly's reasonable disbursements for attending the hearing in Whangarei. If costs and/or disbursements cannot be agreed within one month I will determine the issue following the filing of memoranda. 


[2010] NZSC 112 
Clause 21(1)(g) 
Clause 22(2)(f)(i) 

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