Qld compo law review: promise forgotten?
Brisbane injury compensation lawyer Mark O'Connor challenges Queensland Attorney-General Kerry Shine to explain why he has not publicly followed up his February 2007 promise to review the
Brisbane injury compensation lawyer Mark O'Connor challenges Queensland Attorney-General Kerry Shine to explain why he has not publicly followed up his February 2007 promise to review the state's restrictive injury compensation laws.
It has become a legal iniquity, the way injury compensation laws in Queensland were savaged by the State Government in 2002 and 2003.
A sophisticated fear-mongering campaign driven by insurers and blaming lawyers and litigation rates for huge losses in the insurance industry, such as the collapse of HIH, drove the state Government into ill-conceived and draconian measures to rein in personal injury claims.
Personal injury lawyers were branded as “ambulance chasers” and injury victims seeking compensation were smeared as greedy. Lawyers and claimants were an easy target and easier for the public to comprehend than the inner complexities of the insurance industry, which was largely responsible for its own financial woes at the time.
In Queensland the personal injury compensation landscape was radically changed with the Personal Injury Proceedings Act 2002 ( PIPA) and the Civil Liability Act a year later. The amounts payable to injury victims were slashed and a claims threshold imposed which effectively made it uneconomic for people to pursue less serious claims. Insurers were the big winners.
Attendant with PIPA was a crackdown on lawyers’ advertising personal injury services, especially “no win, no fee” methods – restrictions which continue to this day. It is iniquitous that there are no restrictions on advertising methods employed by the insurance industry.
Since then, Queensland’s injury compensation laws have effectively subsidised insurance companies, and because the five-year-old compensation laws were not inflation-linked, victims are still being paid in December 2003 dollars. This means people are receiving in real dollars much less than they would have received even five years ago
This travesty is long overdue for review, yet in state Government circles, injury compensation laws are a subject never to be acknowledged or publicly discussed.
Attorney-General Kerry Shine briefly raised hope of an overhaul of the laws after the former solicitor was appointed Attorney in late 2006.
He publicly criticised Queensland’s personal injury laws in early 2007, saying they prevented injured people getting justice, while insurance companies profited.
Significantly, he was reported as saying he would consider proposals to make Queensland’s injury compensation system fairer to ensure people got compensation, especially for minor injuries.
However nothing publicly has come of his remarks about overhauling the legislation.
Since then all we have had is an ominous silence and it’s time to remind the Attorney-General of his remarks, and his lack of action.
Mr Shine, who entered Queensland’s Parliament after a career as a solicitor, is reminded of his earlier reported remarks when he stated there was a basic right of people to seek damages for a wrong done to them, and the compensation laws imposed in 2003 did away with that in many cases, especially for smaller claims.
Punitive compensation laws were imposed in 2002 and late 2003 and since then insurers’ profits have soared, while victims have been comprehensively disadvantaged.
Thousands of valid small claims never got off the ground because of the restrictive laws which played right into the pocket of the insurers, who pocketed the premiums while protected by state legislation.
Queensland’s Chief Justice, Paul de Jersey, called for a reform to Queensland’s compensation laws in 2005 but previous Attorneys-General had ignored his advice.
Finally Mr Shine reportedly said he thought the balance went too far, but in the past year and a half he has produced nothing to show what he is doing about it.
We have a compensation system now based on a pre-determined value for specific body parts. Unless claimants have a claim for economic loss, claims might not be viable. A slightly injured pensioner will receive very little because they have no economic loss. The system ignores the impact on their lives, the suffering or nightmares which may haunt them forever. Officially, there’s no value for this so no compensation. It’s cruel.
Under the current compensation system, injuries are ranked on a scale of 1 to 100, with each assigned a dollar value. General damages were capped at $250,000 and court costs were limited to $2500 on payouts between $30,000 and $50,000 and could not be awarded on payouts less than $30,000.
A study of relevant examples of the injury scale values from the Civil Liability Regulations 2003 set out a specific range of compensation payments for various injuries, assessed on a points basis with a dollar value accorded.
Among the examples are:
• Soft tissue “whiplash” type injury to the cervical spine causing 8 per cent loss of whole person impairment – 10 points, $11,000.
• Minor lung injury (eg pulmonary embolism requiring anticoagulant therapy for less than one year) – Zero to five points; nil dollars to $5000.
• Moderate facial injury (fracture of jaw causing permanent effects such as difficulty opening the mouth or eating) – six to 13 points; $6200 to $15,200.
• Moderate eye injury (minor but permanent impairment of vision in one eye including double vision that is minor and intermittent) – six to 10 points; $6200 to $11,000.
• Moderate tinnitus or hearing loss or both – six to 10 points; $6200 to $11,000.
• Total loss of taste or smell or both – six to nine points; $6200 to $9800.
• Loss of part or all of penis - five to 25 points; $5000 to $35,000.
• Loss of one testicle – two to 10 points; $2000 to $11,000.
• Infertility causing moderate effects – nine to 15 points; $9800 to $18,000.
• Moderate injury to kidneys (eg loss of one kidney with no damage to the other kidney) – 11 to 18 points; $12,400 to $22,800.
• Moderate bowel injury (eg injury causing permanent bowel damage or an eventual return to natural bowel function and control after a temporary colostomy for less than three months) – seven to 18 points; $7400 to $22,800.
Before the law was changed a person suffering a certain degree of whiplash injury from a car crash might receive compensation in the range of $20,000 to $30,000. Under the current law they would be lucky to receive $11, 000.
The tragedy is that the $11,000 a person might get today is the exact same sum they would have received in 2003. So in real dollar terms, victims are even worse off.
An example of a client illustrates the state of our PI laws. This man suffered permanent injuries as a passenger in a car crash, but his pain and suffering payout was pegged at less than $18,000.
This is pitiful and about half of what he would have received before the Civil Liability Act. Because the legislation works off a points scale to assess compensation, it uses an impersonal scale to assign a dollar value to body parts.
This man was hospitalised for several days, suffered a collapsed lung, permanent kidney damage, a contusion to the spleen, permanent arm, neck and spinal injuries and a psychiatric injury, and still his pain and suffering payout was pegged at less than $18,000.
The Civil Liability Act compensation scheme terribly undervalues human suffering. In a perverse twist, however, there is no restriction upon the amount which can be claimed for panel damage to cars.
The situation is often made worse by the insistence of insurers that settlements often contain a confidentiality clause. In other words, insurers want to muzzle the clients so other claimants won’t try and pursue a claim.
Restrictions on lawyer advertising further reduce the public’s right to know about their insurance compensation rights. The Civil Liability Act is a form of fiscal punishment on accident and injury victims. It is unfair, unrealistic and harsh.
Compensation under the Civil Liability Act could be as much as two thirds less than what people would have been entitled to under the previous compensation system. The Attorney-General has had more than long enough to evaluate the iniquities of Queensland’s injury compensation laws.
An amendment to the regulation which sets the injury points scale has recently been passed by the Queensland Parliament. Although the Civil Liability Amendment Regulation ( No.1 ) 2008 makes some changes to the description of injuries and marginal variation to the potential dollar value of compensation claimants may receive , it makes no change of substance to the underlying inequities of the system under which injured persons receive less now for damages for their pain , suffering and permanent impairment than they received in 2002 .
When the PIPA laws were introduced, they were made retrospective. These new changes will not take effect until 1 July 2009 and apparently will not be made retrospective.
This is further evidence that the system continues to be designed to favour the insurers.
In the world of injury compo in Queensland the old adage holds true– the more things change, the more they stay the same.
Mark O’Connor is a partner and injury compensation lawyer with prominent Brisbane law firm Bennett and Philp Solicitors.