The recent decision of Mathews v QBE Insurance (Australia) Limited [2022] NSWPIC 226 decided by the Personal Injury Commission (“Commission”) highlights the obligations on claimants and how a failure to seek work might limit the recovery of damages for income loss.
Mr Mathews, aged 57 years old, was riding his motor bike through an intersection when he was T-boned on his right side by a car failing to stop at a red light. He suffered significant physical and psychological injuries and was unable to return to work as a truck driver.
Although the insurer, QBE Insurance, agreed that Mr Mathews suffered impairment due to the accident, including to his past and future economic earning capacity, the insurer disputed the extent of those damages, as Mr Mathews had allegedly failed to mitigate his loss by applying for any employment following the accident. Medical reports had stated that Mr Mathews had a restricted capacity to engage in part-time sedentary work.
It is a requirement that claimants undertake reasonable steps to mitigate their loss.
The Commission noted that whilst the claimant “may have a theoretical earning capacity, the insurer must prove that real jobs exist, such as are suitable to the claimant’s circumstances, in an accessible labour market.” The Commission decided in this case that “given his age, his multiple disability and considerable impairments, that any job applications would be futile.” “His physical and psychological impairments place him at considerable disadvantage in the open labour market.” Future economic loss was claimed based on total incapacity until Mr Mathews’ reached 67 years, being the statutory retirement age.
The Commission assessed Mr Mathews damages as non-economic loss (pain and suffering) as $285,00, past economic loss at $221,725, past superannuation at $24,385, Fox and Woods compensation at $28,370 and future economic loss as $400,000. Total damages awarded were $959,484.75, with a reduction of $230,780.84 for payments already made by insurer. On top of that the insurer would have been required to pay Mr Mathews legal costs.
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