Red tape reduction removes Stat Dec for rejecting claims

Legal Directions

Section 129(5) of the Workers Compensation Act 1951 (ACT) previously provided: ‘If the insurer rejects the claim 28 days or later after the claim is given to the insurer, the notice must include a statutory declaration explaining why the insurer is rejecting the claim’.

The Red Tape Reduction Legislation Amendment Act 2016 (ACT) gave rise to amendments to section 129 effective from 27 April 2016. A statutory declaration is no longer required to be provided in order to reject a workers compensation claim after 28 days with 8 weeks’ notice. Instead, a ‘statement’ will suffice. That removes the need for a qualified witness and reduces administrative burden. The penalties for providing a false statutory declaration no longer apply; however, section 337 of the Criminal Code 2002 (ACT) makes it an offence to make a false or misleading statement.

Section 129(5) now says: ‘If the insurer rejects the claim 28 days or later after the claim is given to the insurer, the notice must include a statement explaining why the insurer is rejecting the claim. Note It is an offence to make a false or misleading statement, give false or misleading information or produce a false or misleading document (see Criminal Code, pt 3.4).’

The Red Tape Reduction Bill is part of a regular series of Red Tape Reduction Legislation Amendment Bills (the Bills) designed to address regulatory requirements that add unnecessary administrative and compliance costs for business, the community and government. The Bill includes amendments to streamline legislation for removing the need for a statutory declaration in a variety of instances, including rejecting workers compensation claims.

The requirement under the Statutory Declarations Act 1993 (Cth) for statutory declarations to be countersigned by an authorised witness before submission created an unnecessary administrative burden. Furthermore, the requirements for authorised witnesses made statutory declarations incompatible with the development of online processing, for example with replacement drivers licences.

The statutory declaration is replaced by a standard declaration. While the penalty for a false or misleading declaration under the Statutory Declarations Act 1993 (Cth) will no longer apply, it will still be an offence under the Criminal Code 2002 (ACT) to give false or misleading information to the Territory or in compliance or purported compliance with a Territory law.

Section 337 of the Criminal Code 2002 (ACT) provides:

Making false or misleading statements

(1)   A person commits an offence if—

(a)   the person makes a statement (whether orally, in a document or in any other way); and

(b)   the statement is false or misleading; and

(c)   the person knows that the statement—

(i)  is false or misleading; or

(ii) omits anything without which the statement is false or misleading; and

(d)   the statement is made in or in relation to an application or claim for a statutory entitlement or a benefit …

Maximum penalty: 100 penalty units, imprisonment for 1 year or both.

There is a similar provision in relation to a person who is reckless about whether the statement is false or misleading; or omits anything without which the statement is false or misleading, with a maximum penalty of 50 penalty units, imprisonment for six months or both.

As such, although a statutory declaration is no longer required, it remains imperative to ensure that the statement of reasons provided for rejecting a claim contains information that is true, well-reasoned and supported by evidence, and does not omit anything relevant to the decision that is known to the insurer.

Authored by Emma Reilly, Partner, Canberra.


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