AHH v Allianz Australia Insurance Limited [2019] NSWDRS MR 195

Jurisdiction Merit Review
CatchwordsPAWE – cleaner – earner – bank deposits – earning continuously – tax returns – objects of the Act
Legislation cited Motor Accident Injuries Act 2017 (NSW) ss ss 1.3(2)(a), 1.3(2)(g), 1.3(4), 1.3(5), 7.13(4), 8.10(3), div 3.3, Schedule 1 clause 2, Schedule 1 clause 4, Schedule 2(1)(a)
Motor Accident Injuries Regulation 2017
Motor Accident Guidelines 2017 
Cases cited


Text cited N/A
Parties AHH – Claimant
Allianz Australia Insurance– Insurer 
Disclaimer This decision has been edited to remove all Unique Personal Identification including the name of the Claimant.

Merit Review Certificate

Reasons for Determination


1.   The Claimant was injured in a motor vehicle accident on 25 July 2019. At the time of the accident he was employed as a cleaner. He has not worked since 16 August 2019 on the advice of his general practitioner.

2.   The Insurer accepted the Claimant’s claim under the Motor Accident Injuries Act 2017 (“the Act”).  In their correspondence to the Claimant dated 28 August 2019 they accept liability for his claim for statutory benefits from the date of the accident for up to 26 weeks.

3.   There is no dispute that the Claimant is an earner as defined by Schedule 1, Clause 2 of the Act. In an email exchanged between the Claimant’s legal representatives and the Insurer dated 16 and 17 September 2019, in answer to questions, the Claimant’s solicitor gave the following particulars in summary: -

3.1  The Claimant’s ABN number

3.2   There is no profit or loss statement

3.3   Expenses include petrol approximately $100.00 per week and one-off expenses $280.00 for uniform and shoes.

3.4   Income is included in bank statements

3.5   Services provided from 30 May 2019

3.6   There are no BAS for the relevant period.

4.   On 18 September 2019 after the Insurer revised the above particulars, additional details and documents were requested.  The Claimant’s solicitor responded in an email dated 19 September 2019 in summary as follows: -

4.1   The Claimant experienced delay in registering an ABN and did not hold an ABN from 10 May 2019 to 10 August 2019.

4.2   Income earned is reflected in his bank statements and earned no funds outside these amounts.

4.3   He was unemployed from 24 May 2018 to 28 May 2019.

4.4   Cash deposit of $20.00 was made to open a bank account and $1,000.00 was from NRMA Insurance for an air conditioner home repair.

4.5   There are no BAS for 2018 because the Claimant was unemployed.

5.   They attach a tax return for 30 June 2019 and confirm the Claimant was employed through an employment agency performing forklift contract work around 2015 but stopped this work around 2016 and was unemployed from 2016 to May 2019. He had no employees.

6.   However, an earlier letter from Turner Freeman Lawyers to the Insurer dated 9 September 2019 says “Our client is a self-employed forklift operator and subcontracts his services “.

7.   This dispute is in relation to the calculation of the Claimant’s pre -accident weekly earning “PAWE”.  The amounts of the PAWE effects the amount of weekly payment of statutory benefits. On 28 August 2019 the Insurer determined that the Claimant’s pre accident weekly earnings to be $207.60.  In September 2019 an internal review was conducted resulting in an increase of the Claimant’s PAWE to $257.51.

8.   The Claimant has applied for a Merit Review by the Dispute Resolution Service (“DRS”) on 1 October 2019.


9.   In conducting my review, I have considered the following legislation and guidelines:

a.   Motor Accident Injuries Act 2017 (NSW) (“the Act”)

b.   Motor Accident Guidelines effective 13 July 2018 (“the Guidelines”)

c.   Motor Accident Injuries Regulation 2017 (NSW) (“the Regulation”)

Pre-Accident Weekly Earnings

10.   The fundamental issue in dispute between the parties is what provision of the Act should the Claimant’s PAWE be determined.  PAWE is defined under Schedule 1, Clause 4 of the Act.

11.   Subclause 1 of clause 4 provides: -

“Pre-Accident weekly earnings”, In relation to an earner who is injured as a result of a motor vehicle accident, means the weekly average of the gross earnings received by the earner as an earner during the 12 months immediately before the day on which the accident occurred, unless Subclause (2) applies.

12.   The Claimant says Schedule 1 Clause 4 of Subclause 2 applies.

13.   Subclause 2 provides

a.   If, on the day of the motor accident, the earner was earning continuously, but had not been earning continuously for at least 12 months – the weekly average of the gross earnings received by the earner as an earner during the period of when the earner started to earn continuously to immediately before the day of the motor accident.

14.   The Insurer has based its calculation of PAWE on the Claimant’s Notice of Assessment and the Claimant individual taxation return 2019.  Adopting these amounts, and applying Clause 4 of Schedule 1 Subclause (1) the Claimant’s PAWE received during the 12 months before the day of the accident the Insurer has calculated the amounts as follows: -

Part A

Income between 24 July 2018 – 30 June 2018 (341 out of 365 days)

$10,000.00 (extracted from individual tax return) ÷ 365 day $27.40

$27.40 x 341 days = $9, 342.47

Part B

Income between 1 July 2019 to 24 July 2019 (24 out of 365 days)

The below amounts are derived from the Claimant’s St George Bank Account

1 July 2019 - $ 960.00

8 July 2019 - $1,152.00

17 July 2019 - $1,056.00

22 July 2019 - $ 880.00

Total =        $4,048.00

Part C

$9,342.47 (Part A) plus $4,048.00(Part B) = $13,390.47

Part D

$13,390.47 ÷ 52 weeks = $257.51

15.   The Claimant’s primary submission is that in the circumstances an analysis of the total earnings averaged over 12 months would result in a calculation of pre-injury average weekly earnings that would not provide the most accurate assessment of the Claimant’s likely earnings but for the injury.

16.   Further, the Claimant says it is clear from Schedule 2 that pre-accident weekly earnings should be calculated as an average of the earnings in that period that the earner was earning continuously not as an average of the entire 12-month period.

17.   Also, the Claimant says there is no dispute the Claimant was only employed for a short period of time prior to the motor vehicle accident.  This is not agreed by the Insurer.  The Claimant says that his bank statement shows periodic deposits made by “the employer “.  The deposits appear to commence on 29 May 2019 and continued to just after the motor accident which occurred on 25 July 2019.

18.   The Claimant says in this period he received $9,694.00 gross payment.  He has calculated this to be a 9-week period and on that basis, he says pre-accident weekly earnings should be assessed at no less than $1,077.11 gross per week.

19.   The Claimant says he did not earn any income outside the amounts reflected in the bank statement found at A8.

20.   Therefore, the Claimant says it should be accepted and determined in accordance with section 3.6 of the Act that the Claimant’s PAWE is $1,077.11.

21.   He says Subclause 4(2) applies.

22.   The Claimant then relies on deposits shown in his St George Statement of Account.  This account was opened on 28 May 2019.  The deposits reflected in that statement prior to accident are as follows: -

a. 29 May 2019 - $1,950.00

b. 10 June 2019 - $1,056.00

c. 24 June 2019 - $1,056.00

d.  1 July 2019 - $   960.00

e.  8 July 2019 -     $1,152.00

f.  15 July 2019 -    $1,056.00

g.  17 July 2019 -   $1,000.00

h.  22 July 2019 -   $   880.00

Total =                    $9,110.00

23.   The number of weeks in which this period relates is 54 days ÷ 7 = 7.7 weeks.  Therefore, he says the PAWE is $1,183.11.

24.   The Claimant’s calculation includes payments made after the motor vehicle accident which are not relevant.

25.   The dispute is whether the Claimant was working continuously between 25 July 2018 and 25 July 2019 or if he had periods with no work, and as such “had not been earning continuously for at least 12 months…”, Subclause 4(2)(a).

26.   I accept his original taxation return 2019 disclosures income amounting to $10,795.00 which includes $795.00 interest, however there is insufficient information contained therein to support the Insurer’s suggestion that the taxation documents clearly confirm that the Claimant was employed prior to May 2019.  In my material there is no evidence to support the proposition that the Claimant was employed or self-employed prior to May 2019.

27.   On examination of the Claimant’s taxation returns it was apparent to me that the Claimant’s answers to the Insurer’s particulars were incorrect.  As a result, I asked the Claimant’s solicitor, through DRS, to provide me with an explanation as follows: -

27.1   The Claimant lodged a 2018 – 2019 tax return which lists income during this period as $10,000.00 (not including $795.00 interest).

27.2   Throughout correspondence and submissions, the Claimant denies any income (in fact was unemployed) until 29 May 2019.

27.3   The gross income he received according to his bank statements from 29 May 2019 to    20 June 2019 is $4,062.00.

27.4   He says from this income, $100.00 per week are petrol expenses plus shoes and uniform which has to be deducted therefore his gross earnings are $4,062.00 less $400.00 petrol and $280.00 for shoes and uniforms which leaves $3,382.00 gross. This deduction has not been claimed in his 2019 tax return.

27.5   If the Claimant’s taxable income for 2018-2019 financial year was $10,000.00 as reflected in his return, please provide evidence of the balance of income amounting to either $5,938.00 (after deductions) or $6,618.00 (before deductions).

28.   In response the Claimant provided to me through his solicitor and an amended tax return dated 30 June 2019. The reason for the amendment is stated as “He declared his income in an initial tax return was to August. So, the real income to 30 June 2019 was $4,766.00.”

29.   In response the Insurer submits no weight be given to the amended return as it does not include the tax payer’s signature nor has a Notice of Assessment been issued.

30.   In response, I have received a Notice of Assessment for year ending 30 June 2019 which refers to the amended taxable income which is $5,561.00 issued by the Australian Taxation Office.

31.   In fairness to the Insurer they were invited to comment on the Notice of Assessment referred to above.  No further response to the filed amended tax return was received.

32.   Having lodged an amended tax return and the Taxation Office issue of a Notice of Assessment for 30 June 2019, I accept the Claimant was unemployed prior to 29 May 2019.  Although the Insurer maintains its submission that the Claimant was employed for 12 months prior to May 2019, I have no evidence from them that this is in fact the true position.

33.   The best evidence is the Notice of Assessment.  The income reflected is $5,561.00 which is income earned from 29 May 2019 to 30 June 2019.

34.   As there was no evidence the Claimant was earning continuously for at least 6 months from the date of accident, I accept Subclause 2 in paragraph 13 of this decision applies.

35.   The calculation according to the Notice of Assessment and bank deposits, I have set out below: -

Part A

35.1 4.72 weeks from 29 May 2019 -30 June 2019

35.2 $5,561.00 ÷ 4.72 weeks = $1,178.18 per week (rounded up)

Part B

35.3 Bank deposits from 1 July 2019 to 22 July 2019 = $4,048.00
Part C

35.4 (.2) +(.3) = $9,609.00

Part D

35.5 1 July 2019 to 22 July 2019 = 3.14 weeks

35.6 4.72 weeks + 3.14 weeks = 7.86 weeks

Part E

35.7 $9,609.00 ÷7.86 weeks = $1,222.52 (rounded up)

36. In considering my determination of this merit review, I have also considered the objects of the Act and in particular Sections 1.3(2)(a), 1.3(2)(g), 1.3(4) and 1.3(5) which provide;

(2) for the purpose, the objects of this Act are as follows: -
(a)   To encourage early and appropriate treatment and care to achieve optimum recovery of persons from injury sustained in motor accidents and to maximise their return to work or other activities;

(g)   To encourage the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes;

(4) In the interpretation of a provision of this Act or the regulations, a construction that would promote the objects of this Act or the provisions is to be preferred to a construction that would not promote those objects

(5)   In the exercise of a discretion conferred by a provision of this Act or the regulations, the person exercising the discretion must do so in the way that would best promote the object of this Act or of the provision concerned.

37.   I am satisfied that $1,222.52 per week is the correct and preferable decision in respect of the continuous PAWE received by the Claimant from May 2019 to 25 July 2019.

38.   I find that the Claimant’s PAWE is $1,222.52.

Replacement Determination

39.   My replacement determination of the Merit Review is as follows: -

Reviewable decision is set aside and the following decision is made in substitution for the reviewable decision

  • The amount of the Claimant’s PAWE is $1,222.52.
  • Effective Date: This determination takes effect on 16 August 2019.  The Insurer is to pay the Claimant the difference between what they have paid and was entitled to be paid in accordance with the decision above.

Legal Costs

40.   The Claimant’s representatives have made an application for legal costs amounting to $1,160.28.

41.  Necessary and reasonable costs are recoverable in respect to disputes in connection with statutory benefits only if permitted by the regulations or DRS, s.8.10(3) of the Act. Subsection 4 of 8.11 provides that DRS can permit legal costs if the Claimant is under a legal disability or exceptional circumstances apply.   I do not consider legal costs are recoverable as the Claimant is not under a legal disability nor am I satisfied, exceptional circumstances apply.

Elyse White
Merit Reviewer, Dispute Resolution Service