Increased rental expenses are compensable as a 'medical service' within the meaning of the Transport Accident Act 1986 (Vic)

In Issue

Whether increased rental expenses are compensable under the Transport Accident Act 1986 (Vic)

The Background

On 8 November 2014, the applicant, then a 12 year old boy, sustained catastrophic injuries when the stationary motorcycle on which he was travelling as a passenger, was struck by a 4-wheel drive. The applicant was rendered a ventilator dependent quadriplegic and is fully dependent on carers for all activities of daily living.

As a result of his injuries, the applicant requires more substantial accommodation than he needed before the accident so as to accommodate his mother (his primary carer), other carers and the equipment necessary for the applicant’s survival and care including heating and cooling facilities as prescribed by his doctors and the essential back up equipment necessary to keep the applicant alive. He claimed the cost of such increased expenses from the respondent.

The Decision at Trial

The trial judge affirmed the respondent's rejection of the claim. The court held that the accommodation could not be characterised as being ‘part and parcel’ of the provision of medical equipment and services as required by earlier decisions. Instead, the accommodation was a separate ‘service’ notwithstanding that its availability was critical for the equipment and services to be used.

The Issues on Appeal

In issue was the proper construction of ss 3 and 60 of the Transport Accident Act 1986 (Vic) (the Act).

The Decision on Appeal

The Court of Appeal rejected the applicant’s arguments that the earlier cases, particularly TAC v Salcedo [2003] VSCA 226, should be overruled or had been misapplied. The trial judge was correct to apply Salcedo and to find that the applicant’s claim did not fall within the defined terms of ‘disability service’ or ‘rehabilitation service’.

The applicant altered the emphasis of his argument on appeal and this meant the central issue was whether the rent associated with the additional accommodation required was capable of constituting the provision of something needed to ‘operate, run, maintain or repair’ life saving and life preserving equipment within the definition of ‘medical service’ in s3 of the Act.

The Court of Appeal held that as a matter of ordinary language, if additional rental space is needed to run and maintain necessary medical equipment, then provision of such space, constitutes a ‘medical service’ and the applicant was entitled to recover his reasonable costs. The context of the Act and its legislative purpose and history also supported this construction of the definition of ‘medical services’.

Implications for you

As a result of this decision, TAC will now be liable for increased accommodation costs arising from motor vehicle accidents. The court noted with implicit approval that that the respondent’s position on the appeal was not to avoid liability for legitimate compensation but instead to seek clarification of its powers to make the payments in issue.

DLZ v TAC [2017] VSCA 134