The Agency may issue a notice requiring the participant to seek compensation.

The Agency may suspend or delay a participant’s access to NDIS supports until this has occurred.  Alternatively, the Agency may take control of the participant’s claim to compensation.

Interpretation of Terms

Compensation

Compensation refers to a payment for personal injury [s11] that includes payment for some or all of the costs of support for the person. Tip

Compensation covers lump sums or periodic payments made within or outside Australia. [s11(2)(a)]

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Liability

The Act separates claims a participant may make into:

  • compensation under a scheme of compensation under a Commonwealth, State or Territory law [s105(2)]; or
  • compensation not under a scheme of compensation under a Commonwealth, State or Territory law [s105(4)]

Action to claim Compensation

Requirement to claim

The Agency may require a participant to take action to claim compensation before the participant will be given access to support under the scheme if [s104]:

  • the Agency believes the participant is entitled to compensation;
  • the participant has taken no or no reasonable action to claim or obtain the compensation; and
  • it is reasonable for the participant to take this action.

Tip

Whether the Agency considers it reasonable for a participant to take action to obtain compensation depends on:

  • the factors listed in [s104(3)]; and
  • whether the Agency believes the participant has reasonable prospects of success in obtaining the compensation. [s104 (4)].

If the Agency considers that it is reasonable for the participant to take action, the Agency may require the participant to do this within 28 days. [s104 (5)]

Failure to claim

If the participant does not take the required action within this period, the Agency may:

  • for Commonwealth, State or Territory Scheme actions [s105(2)]:
    • if a plan is in effect, suspend the participant’s plan; or
    • if a plan is not yet in effect, begin preparing a participant’s plan, but restrict the plan coming into effect until the required action is taken
    • for other actions [s105(4)]:
      • take action to claim or obtain compensation in the name of the participant; or
      • take over the conduct of any existing claim

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Agency recovery of compensation

The Agency may recover compensation owing to the participant by:

  • taking over a participant’s claim; or
  • recovering amounts from past judgments or settlements.

Amounts recoverable through making or taking over a claim

Any amount obtained as a result of a claim made or taken over by the Agency, must be paid to the Agency. The Agency will make the following deductions [s105B]:

  • an amount equal to the total of all NDIS amounts paid to the participant; and
  • the amount of any costs incidental to the claim paid by the Agency.

The remainder is paid to the participant.

The Agency has the authority to [105A(2)]:

  • take whatever steps are appropriate to end the claim;
  • if the claim is before a court , settle the proceedings with or without judgment; and
  • take steps necessary to enforce a judgment.

The participant must sign any documents relevant to a claim taken over by the Agency, including settlement documents. [s105A (3)] If the participant does not sign, the Agency may appoint a representative to sign unless the claim is before a court or tribunal. In this case, the Agency may apply to the court for an order requiring the participant to sign. [s105A (4)]

Amounts recoverable from previous judgments

The Agency is able to recover an amount from the participant’s previous claim if [s106 (1)]:

  • compensation is awarded for  personal injury;
  • before the judgment, NDIS amounts had been paid to the participant; and
  • the judgment specifies that a portion  of the compensation is for supports of the kind funded by the NDIS.

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The amount the Agency is able to recover depends on [s106 (2)]:

  • any reduction applied to compensation by judgment, for example, for contributory negligence;
  • the difference between NDIS payments made and the amount of compensation paid; and
  • amounts paid in accordance with  certain statutory compensation provisions.

The recoverable amount is treated as a debt owed by the participant to the Agency. [s108]

Tip

It is important to note that the Agency may waive a debt owed under special circumstances. [s195]

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Tip

Amounts recoverable from consent judgments or settlements

The Agency is able to recover an amount from the participant if [s107 (1)]:

  • an amount of compensation has been fixed under a consent judgment or settlement for  the participant’s personal injury; and
  • before the judgment or settlement, NDIS payments had been made.

The amount recoverable depends on [s107(2)]:

  • the sum of past NDIS amounts, reduced by any reduction due to contributory negligence etc; and
  • any payments made under other statutory schemes.

The recoverable amount is treated as a debt owed by the participant to the Agency. [s108]

Tip

It is important to note that the Agency may waive a debt owed under special circumstances. [s195]

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Recovery from potential compensation payers and insurers

The Agency is able to issue a potential compensation payer or insurer with a notice that they are required to pay an amount to the Agency.

If the Agency issues this notice, the compensation payer, or potential compensation payer, is not liable to the participant while the notice is in effect. [s112 (1)]

If the person or insurance company pays the Agency the amount liable for the injury to the participant, such payment discharges the person or company’s liability to the participant and the participant’s liability to the Agency. [s113]


Last Modified: June 28, 2013