ACC faces huge compo bill for halted payouts

Last updated 05:00 22/07/2014

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A multi-million dollar windfall is waiting to be claimed by as many as 1500 accident victims for interest on wrongly halted weekly compensation payments dating back decades.

The Court of Appeal in Wellington ruled against Accident Compensation Corporation in May last year, forcing it to pay interest on late payments of weekly compensation that it reimbursed accident victims after earlier incorrectly suspending their payments.

ACC revealed in documents released under the Official Information Act that it predicted the case could cost it $7.5 million to $30m.

It identified 2600 people as "potentially eligible" for the interest payouts but only 1096 had applied for them to date and it had paid out $6.3m to 795 successful claimants.

Wellington ACC lawyer John Miller, who took the representative case on behalf of Auckland accident victim Kenneth Miller, urged people to contact ACC to check if they were owed money from overdue interest.

"If they had late payments from ACC at any time, they should contact ACC and if they have any problems, they should contact us."

He said it was a significant legal win that clarified the law.

One of ACC's documents released last week was a report to its executive by an unnamed policy analyst in May last year that noted the Kenneth Miller decision highlighted the importance of ensuring it used well-considered and sound information before stopping clients' weekly compensation.

"ACC needs to be mindful that if it makes decisions to suspend weekly compensation based on insufficient information or evidence, that the decision, if overturned, will effectively also come with a financial penalty for ACC," the report says.

It stated ACC was liable to pay interest if it wrongly interpreted the law, misinterpreted medical advice or received ambiguous medical advice that led to it cancelling compensation that later proved wrong.

ACC had set up a panel to identify eligible accident victims but admitted that it would be difficult to find them all.

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- The Dominion Post

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