IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV BETWEEN VERONICA WEIR Appellant

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1 IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY CIV BETWEEN VERONICA WEIR Appellant AND ACCIDENT COMPENSATION CORPORATION Respondent Hearing: 15 July 2004 Appearances: J Miller & S A Thistoll for Appellant A Barnett for Respondent Judgment: 18 August 2004 RESERVED JUDGMENT OF MILLER J 1. On 24 May 2002, the respondent ( ACC ) completed an individual rehabilitation plan ( IRP ) for the appellant, Mrs Veronica Weir. The IRP was prepared under s.75 of the Injury Prevention, Rehabilitation, and Compensation Act 2001 ( the Act ). 2. The IRP provided for an outcome, being return to work or work readiness. 3. Mrs Weir says that ACC s decision to provide for return to work in the IRP is reviewable under s.134 of the Act, which allows Mrs Weir to apply to an ACC-appointed reviewer for a review of any of its decisions on the claim. ACC contends that inclusion of a work readiness goal in the IRP is an administrative step having nothing to do with Mrs Weir s entitlements under the Act, and accordingly is not reviewable. 4. A reviewer agreed with ACC, as did Judge Middleton on appeal to the District Court. Leave was granted to appeal to this Court on a question of law under s.162 of the Act. Factual background 5. Mrs Weir suffers chronic pain as a result of a medical misadventure suffered ten years ago. It is common ground that she has cover under the Act for this injury, in respect of which she is in receipt of weekly earnings compensation. 6. Until 2002, her rehabilitation focused on social rehabilitation. An IRP prepared under the Accident Insurance Act 1998 in 2000 established a goal of regaining independence in everyday activities. 7. In May 2002, however, Mrs Weir s case manager at ACC initiated an IRP the goal of which was return to work or work readiness. It provided that this outcome was to be achieved by 30 June Mrs Weir and her case manager signed the IRP.

2 8. The IRP also provided for specific interventions. The case manager was to obtain an update from Mrs Weir s general practitioner. Mrs Weir was to increase her exercise by commencing a regular walking programme. Lastly, the case manager and Mrs Weir were to meet before 30 June to review these reports and make further plans. 9. The IRP contained the following rehabilitation declaration: I understand that the ACC will: meet my rehabilitation needs in accordance with the Injury Prevention, Rehabilitation and Compensation Act 2001 (the Act) provide rehabilitation to help me lead as normal a life as possible in view of my personal injury help me where possible to meet the objectives of this plan I accept that I have to take personal responsibility for my rehabilitation, and I will actively participate in this rehabilitation plan that has been developed with ACC. I acknowledge that this plan: identifies my entitlements, needs and suitable rehabilitation services is binding once I have signed it and it has been accepted by ACC. However, I realise that the plan may change by negotiated agreement in the future, and this will be recorded with further signatures. My Case Manager has provided information explaining the relevant sections of the Act, my review rights and Privacy Legislation. This was discussed with me during the preparation of this plan. I understand that if I unreasonably refuse or fail to agree or comply with this plan, ACC may decline to provide entitlements. 10. Although the IRP provided that the outcome was to be achieved by 30 June, it is clear that the case manager intended only that progress would be reviewed by that date. The case manager acknowledged at the time that the goal of return to work or work readiness was a long-term goal. I add that a further IRP was signed in August 2002, and that IRP is not in issue. 11. On 14 August 2002 Mrs Weir applied for review of the IRP under s.134 of the Act. Mrs Weir did so because she takes issue with ACC s change of focus from regaining independence to gaining capacity for work. The reviewer dismissed the application in a decision dated 3 October Mrs Weir appealed to the District Court, and her appeal was dismissed in a decision dated 27 March The Judge held that ACC had not made a reviewable decision by agreeing, with Mrs Weir, to the IRP of May To put this decision in context it is necessary to outline a number of the Act s provisions. The legislation (a) Entitlement to weekly compensation 12. A claimant who has cover under the Act and who lodges a claim for weekly compensation is entitled under s.100 to receive it if ACC determines that she is incapacitated, in the sense that she is unable because of her personal injury to engage in employment in which she was employed when she suffered the injury, and she qualified as an earner at the time she was

3 incapacitated. Under s.102, ACC may review the claimant s incapacity from time to time. In doing so it must consider an assessment by a registered medical practitioner and may obtain any professional, technical, specialised or other advice from any person it considers appropriate. (b) Vocational rehabilitation as both entitlement and obligation 13. Rehabilitation appears in s.69 as the first in a list of entitlements that include various forms of compensation. But rehabilitation differs from other entitlements. The Act s purpose statement provides that where injuries occur, rehabilitation is to be ACC s primary focus, with fair compensation being paid during rehabilitation. And rehabilitation is intended to remove the need for compensation. It is accordingly both an entitlement and an obligation. Section 70 of the Act provides: A claimant who has suffered personal injury for which he or she has cover (a) is entitled to be provided by the Corporation with rehabilitation, to the extent provided by this Act, to assist in restoring the claimant's health, independence, and participation to the maximum extent practicable; but (b) is responsible for his or her own rehabilitation to the extent practicable having regard to the consequences of his or her personal injury. 14. In the case of a claimant in receipt of weekly compensation, ACC is liable under s.85 to provide vocational rehabilitation, to the extent provided by the Act, whether or not she applied for it, and the claimant must co-operate or risk loss of compensation. Section 72 requires the claimant to co-operate with ACC in the preparation of an IRP, and s.117 allows ACC to suspend or decline compensation if the claimant fails to agree to an IRP or comply with it. [c] Obligation to prepare IRP 15. Although ACC is liable to provide rehabilitation, the content of its obligation in any given case depends on whether the claimant needs rehabilitation and, if so, in what form. Rehabilitation : (a) means a process of active change and support with the goal of restoring, to the extent provided under section 70, a claimant's health, independence, and participation; and (b) comprises treatment, social rehabilitation, and vocational rehabilitation 16. Section 75 of the Act requires that ACC must, within 13 weeks after accepting a claim for cover, determine whether the claimant is likely to need social or vocational rehabilitation after the 13 weeks have ended. If so, it must prepare an IRP in consultation with the claimant. IRP: (a) means a plan under section 75 that provides for a claimant to receive rehabilitation that will assist in accordance with section 70 in restoring the claimant's health, independence, and participation to the maximum practicable extent 17. ACC may include provision for treatment in the IRP. After an IRP is agreed, ACC is liable to provide the claimant with rehabilitation in accordance with the IRP and schedule 1 of the Act, but only to the extent that ACC has specified which services it will provide under the

4 plan; section 76(4). (d) IRP must reflect assessment of claimant s vocational rehabilitation needs 18. In preparing an IRP, ACC is obliged under s.77 to assess the claimant s need for rehabilitation having regard to the purposes of social and vocational rehabilitation. The purpose of vocational rehabilitation is set out in s.80. (1) The purpose of vocational rehabilitation is to help a claimant to, as appropriate, (a) maintain employment; or (b) obtain employment; or regain or acquire vocational independence. (2) Without limiting subsection (1), the provision of vocational rehabilitation includes the provision of activities for the purpose of maintaining or obtaining employment that is (a) suitable for the claimant; and (b) appropriate for the claimant's levels of training and experience. 19. Section 77(2) provides that: An individual rehabilitation plan must (a) identify the claimant's needs for rehabilitation; and (b) identify the assessments to be done; and identify services appropriate to those needs, whether or not the Corporation is liable to provide any or all of those services; and (d) specify which of the services identified under paragraph that the Corporation will provide, pay for, or contribute to. 20. For the purposes of identifying the claimant s needs for vocational rehabilitation, ACC is required to comply with ss of the Act unless the claimant s needs are solely related to maintaining employment. Section 89 provides for an initial occupational assessment to identify the types of work that may be appropriate for the claimant, and an initial medical assessment to determine whether the types of work identified by the occupational assessor are likely to be medically sustainable for the claimant. 21. An assessor whom ACC considers has qualifications and experience appropriate to any particular case must undertake the occupational assessment. The assessor is required to take into account information provided by the Corporation and the claimant, discuss with the claimant all of the types of work that are available in New Zealand and suitable for her, and consider any comments that she makes about those types of work. 22. The medical assessor must be a registered medical practitioner who holds vocational registration under the Medical Practitioners Act 1995 and who also has an interest, and proven work experience, in disability management in the workplace or occupational rehabilitation. The medical assessor must also have at least five years experience in general practice and possess certain other qualifications. 23. The Act accordingly envisages that the initial occupational assessment and initial medical assessment will inform ACC s assessment of the claimant s vocational rehabilitation needs for the purposes of the IRP prepared under s.75 and s.77.

5 24. Although ACC is obliged to assess the claimant s needs using occupational and medical assessments, it has a discretion whether to provide vocational rehabilitation and, if so, in what form. Its discretion is controlled by sections 86 and 87. (e) Review of ACC decisions 25. The Act provides for review of ACC decisions by an ACC-appointed reviewer, who is required to act independently, with a right of appeal to the District Court. Section 134(1) of the Act provides: A claimant may apply to the Corporation for a review of (a) any of its decisions on the claim: (b) any delay in processing the claim for entitlement that the claimant believes is an unreasonable delay: any of its decisions under the Code on a complaint by the claimant. 26. A decision includes all or any of the following decisions by ACC: (a) a decision whether or not a claimant has cover: (b) a decision about the classification of the personal injury a claimant has suffered (for example, a work-related personal injury or a motor vehicle injury): a decision whether or not the Corporation will provide any entitlements to a claimant: (d) a decision about which entitlements the Corporation will provide to a claimant: (e) a decision about the level of any entitlements to be provided: (f) a decision relating to the levy payable by a particular levy payer: (g) a decision made under the Code about a claimant's complaint 27. This definition is enlarged upon by Clause 9 of Schedule 1. That schedule sets out a process for providing information to a claimant about rehabilitation and the process of developing an IRP, and securing the claimant s agreement to the IRP. Clause 8 provides that if, after a reasonable time, a claimant declines to agree to the IRP, ACC may advise the claimant that it is finalised and the IRP is then to be regarded as if the claimant had agreed to it. When the IRP is agreed or finalised, ACC must implement it. Clause 9 of schedule 1 provides: (1) For the purposes of Part 5 of this Act, the Corporation makes a decision when (a) the claimant agrees to an [IRP]; or (b) the Corporation advises the claimant that [an IRP] has been finalised. (2) The fact that a claimant has agreed to [an IRP] does not affect his or her rights to make a review application under Part 5 of this Act with respect to the [IRP]. 28. The right of review of s.134(1)(a) relates to any of ACC s decisions on the claim. Claim means a claim under s.48, which provides: A person who wishes to claim under this Act must lodge a claim with the Corporation for (a) cover for his or her personal injury; or (b) cover, and a specified entitlement, for his or her personal injury; or a specified entitlement for his or her personal injury, once the Corporation has accepted the person has cover for the personal injury. Questions

6 29. In granting leave to appeal under s.162 of the Act, Judge Cadenhead determined that two questions of law arose: The first issue is whether Clause 9 itself confers a discrete right of review, independent of sections 134 and 48 of the Act. In short, may there be a right of review concerning an individual rehabilitation plan even if no entitlements are in issue. The second issue is whether or not the purposes set out in the individual rehabilitation plan affected any entitlements previously conferred upon the appellant, and whether or not the stated purposes contravened sections 86 and 87 of the Act. Issue 1: Whether IRP is reviewable 30. Judge Middleton held that an IRP, although a decision in terms of clause 9 of schedule 1, is not a decision on the claim for the purposes of s.134(1)(a). The learned Judge reasoned that a claim for the purposes of s.48 of the Act refers to a claim for cover or for a specified entitlement. An IRP does not in itself provide any entitlements. Accordingly, it is not a decision on the claim, and Mrs Weir was not entitled to apply for review. (a) Submissions 31. Mr Barnett essentially adopted the Judge s reasoning. He also emphasised that the IRP s stated outcome of return to work or work readiness in this case was a long-term goal. Mrs Weir was not at risk of losing her weekly compensation entitlement unless she became fit to return to her pre-accident employment or she achieved vocational independence, as determined under the statutory process in s of the Act. Any such decision would be reviewable. 32. Further, Mr Barnett contended that the Act must be administered in a way which does not result in a right of review for every administrative decision made by ACC. He conceded that a decision to provide or deny an entitlement that is recorded in an IRP is reviewable but submitted that the IRP itself is not. If the IRP can be reviewed, administration of the Act would become moribund. 33. For Mrs Weir, Mr Miller submitted that clause 9 of schedule 1 defines an IRP as a decision for the purposes of the Act, and it would not do so unless rights attached to it. He emphasised that rehabilitation is of central importance, and that an IRP may have consequences for a claimant long before a decision is made to withdraw weekly compensation. Claimants have learned to be wary of case managers bearing gifts in the form of offers of rehabilitation. ACC s decision to impose a goal of return to work or work readiness is likely to be the first step on a path that would lead to Mrs Weir being deprived of compensation, either because she was deemed under s.86 to be capable of some sort of work or because ACC might conclude that her inability to work was the product of some other cause. In the latter case, ACC might deem the claimant to be suited to work which was manifestly impossible - the legless tapdancer phenomenon referred to in Kenyon v ACC (Wellington High Court, AP 258/00, 19 December 2001, Fisher J). He pointed to the provisions of the Act that force a claimant to co-operate in the preparation of an IRP, and the consequences if the claimant fails to do so. He emphasised the effective power these

7 provisions give a case manager over the individual claimant. (b) Discussion 34. There was no dispute that an IRP is deemed to be a decision made by ACC at the point when the claimant agrees to it or ACC advises her that the IRP has been finalised pursuant to clauses 8 and 9 of schedule 1. The question is whether it is a decision on the claim for purposes of s Judge Middleton held that the claim referred to in s.134 is that described in s.48. His reasoning focused on the fact that the claim under s.48, in the case of a person who has cover, must be for an entitlement. He held that this IRP did not provide for any entitlement. 36. However, the introductory words of s.48 make it clear that a claim is lodged by a person who wishes to claim under the Act for cover or a specified entitlement. In this case, Mrs Weir lodged a claim for cover and weekly compensation, which is an entitlement under ss.69 and 100. The claimant defines what it is that is sought. Mrs Weir claimed weekly compensation as envisaged by s.100, which speaks of a claimant who has cover and lodges a claim for weekly compensation. The IRP was not a claim. Rather, the IRP was a decision made in the context of Mrs Weir s continuing claim for cover and weekly compensation. It may eventually lead to the entitlement being removed following Mrs Weir s successful rehabilitation, and it will of course lead to rehabilitation being undertaken in the meantime. 37. Plainly Mrs Weir s claim was lodged some years before the IRP was prepared. However, s.102 allows ACC to revisit a claimant s incapacity from time to time, and ss.78 and 88 envisage that an IRP will be updated, and vocational rehabilitation modified, periodically. Section 134(1)(a) allows a claimant to apply for a review of any of ACC s decisions on the claim. The section envisages a number of decisions on a single claim. 38. It follows that it is immaterial that the IRP in this case did not itself provide for the grant or loss of any specific entitlement. Mr Barnett contended that the IRP was only a preliminary step, in that it simply provided for a goal. However, the IRP was by definition a decision, whatever its content, and it did not stand in isolation. Rather, it related to Mrs Weir s claim for weekly compensation. In any event, Mrs Weir was entitled to regard the change in the goal as significant, in that it signalled a decision by ACC to prepare her for loss of compensation and to undertake vocational rehabilitation in the meantime. Indeed, it began that process by providing for a walking programme. 39. It is not necessary to deal with Mr Miller s alternative argument that the IRP was a claim for purposes of s.48 because it deals by definition with rehabilitation, which is an entitlement. 40. In answer to Mr Barnett s point that this decision would open up ACC s administration to constant review, several points may be made. The first is that an IRP is not simply an administrative process. The statute prescribes it, and it is of central importance to the

8 statutory goal of rehabilitation. Statutory obligations surround it. Second, it remains the case that only decisions, as defined in s.6 and clause 9 of schedule 1, are reviewable. Third, it is impossible to overlook the fact that an IRP is expressly defined as a decision in clause 9, which does not distinguish between IRP s that provide for or remove entitlements and those that do not. 41. I have considered decisions made under the 1998 Act: O Donnell v Accident Compensation Corporation (Wellington District Court, 139/2002, 22 May 2002, Judge Willy), Howard v Accident Compensation Corporation (Christchurch District Court, 267/2002, 26 September 2002, Judge Beattie). I have not found them helpful. As Mr Miller pointed out, cl.9 in Schedule 1 to the 2001 Act is in different terms to cl.34 in the 1998 Act, which preserved the right of review in respect of entitlements provided in the IRP notwithstanding the claimant s agreement to the IRP. Conclusion 42. I conclude that the IRP in this case is reviewable, not because there is an independent right of review in clause 9 but because it was a decision on the claim for the purposes of s.134(1)(a). The claim referred to is that lodged by Mrs Weir under s.48 for an entitlement in the form of weekly compensation. Issue 2: Whether IRP complied with ss.86 and As explained in argument, the second issue identified by Judge Cadenhead is directed to the question whether the IRP contravened the Act s provisions dealing with the process for preparing an IRP. Sections 86 and 87 require ACC, when considering vocational rehabilitation, to have regard to considerations including whether the claimant is fit for her original work, or for other work that may utilise her skills, and the appropriateness of any given rehabilitation. [/b](a) Submissions 44. Mr Miller contended that ACC was not entitled to prepare an IRP providing for a change in goal without first undertaking occupational and medical assessments under ss The change in goal is a significant step in itself, and will lead in time to loss of compensation. 45. Mr Barnett responded that the IRP provided for no specific interventions but only for a goal. The occupational and medical assessments provided for in ss89-96 will be undertaken at the appropriate time, and Mrs Weir does not risk losing her compensation until then. Any decision by ACC to terminate compensation will be reviewable. (b) Discussion 46. The process followed in this case was appropriate to an IRP in that Mrs Weir s case manager used the ACC form, which contains the declaration referred to in paragraph 9 above, and procured Mrs Weir s consent to the IRP. I have no doubt that it was intended to be an IRP, to which Mrs Weir was to make a commitment.

9 47. However, there was no attempt to comply with s.77, which requires ACC to assess the claimant s needs for rehabilitation when preparing an IRP. With respect to vocational rehabilitation, an assessment must be made under ss Where an IRP has previously been prepared, ACC s obligation is to update it under s.78 to reflect the outcome of assessments done and progress made under the plan. I record that the case was not presented to me on the basis that ACC was merely updating a previous IRP and therefore did not have to undertake a formal assessment. Although IRP s had been prepared in the past, it appears that no formal vocational assessment had been done, because the goal had been one of regaining independence. Conclusion 48. I conclude that the IRP in this case did not comply with the Act, in that the goal of return to work or work readiness was adopted without benefit of any formal assessment under s.77. I accept that ACC would have arranged vocational rehabilitation before terminating weekly compensation, but the Act envisages that ACC must assess a claimant s needs for rehabilitation at the time the IRP is prepared. No such assessment was undertaken. [b]decision 49. I answer the questions stated by Judge Cadenhead as follows: a) Question 1: the IRP in this case was a decision on the claim for purposes of s.134(1)(a), and was reviewable under s.134. b) Question 2: the IRP in this case did not comply with the Act, in that the goal of return to work or work readiness was adopted without any assessment of the claimant s needs for rehabilitation under s.77. Such assessment should have been undertaken when the IRP was prepared. I answer this question on the assumption that ACC had not previously undertaken a vocational rehabilitation assessment under s.77 and ss Delivered at 8.30 am this 18th day of August F Miller J Solicitors: John Miller Law, Wellington for Appellant Broadmore Barnett, Wellington for Respondent

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