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In March 2021, an orthopaedic surgeon replaced a patient’s hip. Unfortunately, the patient suffered a postoperative infection requiring several subsequent operations. Through the dispute tribunal, the patient sought a refund of the fee paid to the surgeon, alleging that the surgeon was negligent during the operation.
This article considers whether a claim for negligence brought under the provisions of the Consumer Guarantees Act 1993 (CGA) can succeed.
There is a complex interface between the Accident Compensation Act 2001 (ACA) and CGA that needs to be considered.
New Zealand’s accident compensation scheme provides cover for personal injuries for New Zealand citizens and residents and to temporary visitors to New Zealand. Under the ACA, accidental injuries include personal injuries suffered during the course of treatment by a registered health professional. This is referred to as a ‘treatment injury’. Section 32 of the ACA outlines what constitutes a treatment injury, while section 33 defines treatment in this context. Examples include:
administering treatment or prophylaxis
diagnosing a medical condition
decisions relating to treatment
failing to provide treatment or provide it in a timely manner
obtaining or failing to obtain consent from a person to undergo treatment
equipment failure (except fair wear and tear)
use of policies, process, and support systems which support treatment
Registered health professionals in New Zealand cannot be sued in negligence for compensatory damages arising directly or indirectly out of personal injury covered by the ACA. This is known as the ‘statutory bar to sue’ and is expressly provided for in section 317 of the ACA.
However, proceedings can be brought against registered health professionals for exemplary damages for conduct that has resulted in personal injury, but only if they serve a punitive, not a compensatory purpose. Exemplary damages will only be awarded in cases where the defendant ‘deliberately and outrageously ran a consciously appreciated risk of causing personal injury to the plaintiff’. 1 Whether running such a risk should be regarded as outrageous will depend on the degree of risk that was appreciated and the seriousness of the personal injury that was foreseen as likely to ensue if the risk materialised. The case law is clear, the threshold for exemplary damages is high, reserved for the most outrageous cases only.
The statutory bar to sue (provided by section 317 of the ACA) also precludes claims against registered health professionals brought against them independently of the ACA. However, the law stipulates that certain proceedings can be held under jurisdictions other than the courts. For example, an aggrieved person (or their representative) can bring proceedings against a health practitioner if there has been a breach of the Code of Health and Disability Services Consumers’ Right as a result of treatment, in the Human Rights Review Tribunal. Complaints can also be made to the Office of the Privacy Commissioner and Health and Disability Commissioner. These avenues are important because they provide a means of redressing alleged negligence and substandard care.
The CGA protects the consumers’ rights through a series of guarantees which sellers automatically make to consumers when any goods or services are purchased for personal use. As a minimum, the goods must be of acceptable quality and fit for a particular purpose, while the services must be performed with reasonable care and skill, be fit for the particular purpose they were supplied and at an agreed or reasonable price (if no price or pricing formula has been previously agreed).
If a problem cannot be fixed, the consumer can claim compensation through the dispute tribunal for the decrease in the value of the product or service and may also claim for any reasonably foreseeable extra loss that results from the initial problem.
In the case of the orthopaedic surgeon and the hip replacement, outlined above, the patient alleged that there was a commercial aspect in their transaction with the surgeon and, as the patient did not receive value for what he or she had paid for and cannot receive adequate monetary compensation from ACC, the patient’s rights under the CGA have not been met. Therefore, the question arises whether the statutory bar to seek damages prohibits the patient’s right to receive a refund under the CGA. If successful, the claim would essentially circumvent the section 317 statutory bar.
In his deliberation, the judge opined that patient’s request for restitution was in essence, a claim for damages framed under the CGA and as such, it was barred under section 317 of the ACA. Accordingly, the claim was struck out on the basis that the disputes tribunal did not have jurisdiction.
This decision confirmed the statutory bar to sue registered health professionals for negligence, provided by section 317 of the ACA, even when claims against them are brought independently of the ACA.
Reference
Susan Couch v the Attorney General — Courts of New Zealand (courtsofnz.govt.nz)