Legal Issues - Personal Injury Claims

What are legitimate grounds for compensation?
By Matthew Goold

There has been considerable media attention recently concerning compensation awarded to persons who have made claims for personal injuries including; the surfer against Waverley Council where the swimmer dived into the surf, and the person who was assaulted whilst robbing a hotel where they received awards for personal injuries. Whilst the law must be in step with public opinion, many media commentators and politicians chose to ignore why the law awards compensation to injured people. It may even be said that recent media attention displays a lack of compassion when dealing with the impact that avoidable injury has on the lives of ordinary Australians. Very few media commentators and even fewer politicians suffer the misfortune of being seriously injured. Many injuries suffered by average Australians are either work related or alternatively, occur on the road or in circumstances where the injury arises because another person has failed to act carefully.

The current ‘buzz term’ espoused by the media and by certain politicians is that people need to be responsible for their own actions. Are they inferring that people allow themselves to be injured just so they can claim compensation? Injured persons should not be vilified and portrayed as ‘bludgers’ who are just making a claim because they want a free ride. Before the public is entitled to be outraged at the compensation paid to injured persons, Australian society must look at the law that has been developed by the courts over the last century which is designed to protect the rights of injured persons and to award them compensation when their rights are violated. Many people erroneously believe that if a person suffers an injury, then compensation is payable. This is wrong. Apart from workers compensation, for compensation to be payable at law, an injury must be caused to another person.

An injury can be caused because of a wrongful act or because somebody failed to prevent the injury from occurring. Every person owes a duty of care not to cause avoidable harm to others. The law says that a person must not breach this duty of care. If they do then that person has been negligent. A person, health professional, company or council is negligent at law only because they have failed to prevent avoidable harm occurring to another person. Compensation is not designed to punish the wrongdoer or enrich the victim. Other than in workers compensation cases, the law does not award compensation just because a person suffers an injury. It is only where the injury arises because another person has breached their duty of care and thereby caused the injury to occur or failed to take steps to prevent the injury from occurring that compensation may be payable.

The amount of compensation payable does not depend on how the injury occurred, nor is it designed to punish the wrongdoer. Compensation is paid to put the injured person back into the same position (in financial terms) that he would have been if he had not been injured. Injured persons sometimes fail to fully recover from a serious injury and when this occurs, they do not regain the same degree of health, physical or mental functionality that they enjoyed before the injury was caused to them. Before we all condemn the Court and the lawyers for the outrageous awards that are being proposed in respect to personal injuries matters we must look behind the verdicts to the facts.

As a general rule in personal injuries actions we must look at two things:

Has there been a breach in an obligation or a duty, and if such a breach has been established, has the injured person suffered loss and damages as a result? In many cases there may well have been a breach in a duty owed but the damages do not flow. For example, a man attended a public hospital with an ankle injury. The ankle at that particular time was swollen and he waited some hours before he saw a practitioner at the emergency department. After seeing the doctor the injury was not X-rayed. The ankle was clearly swollen and he was sent home from hospital with two painkillers and not given any further treatment. He was told at the time that if he had any further problems he should consult his own general practitioner the following week. Being in intense pain by Monday the gentleman saw his GP who arranged an X-ray. The X-ray showed a fracture to the right ankle and it was then plastered. There was no additional damage. In other words, the failure by the hospital to properly identify the fracture did not increase the damage to the ankle.

The amount of compensation paid also differs from case to case. Consider for example the case where a banker and a bricklayer are travelling home in a taxi after having dinner together. The cab driver takes a corner at excessive speed and a serious accident occurs. The cab driver is negligent and has insurance. The banker and the bricklayer suffer exactly the same injuries, namely, some bruising, a broken hip and a badly mangled lower left arm and hand. For both the banker and the bricklayer the bruising heals and so does the broken hip, but their mangled left arms are such they have to be amputated. Do they receive the same amount of compensation? Probably not, because the banker can still be a banker despite the amputation, but the bricklayer can’t lay bricks with just one arm. As such, the bricklayer will incur substantial financial loss in the future because he has lost his earning capacity and as such, he will probably receive more compensation than the banker.

Injured people are compensated; for past economic loss, (that is, wages lost up until the date of trial), for future economic loss (if there is any), general damages for pain and suffering (although recent government legislation severely limits this, and an amount for past and future hospital and medical expenses. They may also be awarded an amount for domestic assistance. State Governments in recent months have sought to limit access to the amount of compensation payable. When the media headlines an occasional multi-million dollar compensation pay out, the intelligent public should look at how the amount of compensation has been determined. The compensation is designed simply to put the injured person back into the same situation that they would have been in but for the injury. The courts will not allow (except in very exceptional cases) punitive damages. Punitive damages are awarded to punish the wrongdoer for his wrongful action. Punitive damages are very common in the USA but they do not form part of the Australian legal system. The amount of compensation paid to persons injured in America is substantially greater then the compensation paid under Australian law.

Recent changes by various State governments have limited the amount of compensation payable. These changes have occurred because the insurance companies substantially increased premiums subsequent to the collapse of HIH. These increases were substantial and rightly or wrongly, various governments and industry groups used the media to put forward the argument that compensation pay outs in this country were ridiculous and needed to be hauled in - in addition, the government and the media attributed part of the blame to lawyers. Various State governments vehemently deny that the numerous recent changes to legislation relating to public liability claims, motor vehicle claims and workers compensation claims disadvantage ordinary Australians. Of course, only time will tell whether these changes will serve to protect the public interest or the god of profit. The reality is that persons who are injured and who are not adequately compensated because of government legislation, will over time, become one of Australia’s poor and our social security system will have to pick up the burden If you are injured by someone and if you suffer loss and damage then you should obtain competent and experienced legal advice to guide you through the maze of legislative changes so that you obtain just compensation benefit.

Despite the media opining that we are heading this way, Australia is not turning into another United States. Prudent lawyers do not commence actions that are without merit. In fact, in New South Wales, we must now file documents to say that our client’s claim has merit. If you have been involved in any personal injuries action be it a slip and fall, motor vehicle, workers compensation, or medical negligence action you must obtain appropriate legal advice. The commencement of these actions are governed by strict and limited timetables. That is, you only have a limited amount of time in which to commence them. Each State and Territory has differing timetables. In new South Wales for example, you should be aware that if you wish to make a claim in respect to a motor vehicle accident you have six months in which to file your claim form. You then have three years in which to bring the proceedings. And during those three years you must obtain certificates from a number of different instrumentalities. Quick action is good action. The reality is that if you obtain competent and informed legal opinion expeditiously then you too can have ‘peace of mind’.

Matthew Goold is a Team Leader of the personal injuries section at MBP Legal