AWE or Average Weekly Earnings
These terms are abbreviations for average weekly total earnings of adult male full-time employees in Australia. In this Report, this amount has been assumed to be $420 (Consulting Actuary’s estimate at 30 June 1984). 1
Common Law
The common law is the body of legal rules developed by the courts on the basis of judicial custom and precedent. It is distinguished from statute law, which is contained in legislation enacted by Parliament.
Common Law Negligence Action
A common law negligence action may be brought by a person (the plaintiff who has been injured as the result of the fault of another person (the defendant). The plaintiff in such an action claims damages for the loss sustained. The term is used in this Report to include statutory modifications to the common law, such as legislation allowing the dependents of the deceased person to claim damages for loss resulting from the death.
Compensable
The term “compensable” refers to a person I s entitlement to be compensated for losses or other ill effects of an injury.
Contract
A contract is an agreement between two or more people, which is intended to be legally enforceable.
Damages
This term refers (among other things) to the monetary compensation which may be awarded to the plaintiff by a court in a common law negligence action.
Disability
Disability is a measurable functional limitation or loss resulting from either a physical or mental impairment. 2 See also Handicap and Impairment.
Economic Loss
Economic loss refers to those consequences of an injury which have a monetary equivalent such as loss of wages or medical expenses. See also Non-Economic Loss.
Fault
Fault refers to the breach of a duty owed by one person to another, such as the duty to act carefully so as to avoid injury.
Funded Scheme
A funded insurance scheme is one in which the premiums collected in any given year are sufficient to meet all claims arising from accidents in that year, whether or not payments are actually made in that year. Under a fully funded scheme, the insurer should set aside reserves sufficient with investment income, to meet the estimated cost of outstanding claims. See also Pay-As-You-Go Scheme.
Handicap
Handicap is a social disadvantage resulting from an impairment or disability that limits or prevents the fulfilment of the role which is normal for an individual. 3 See also Disability and Impairment.
Impairment
Impairment is a medical term for anatomical loss or loss of bodily or mental function The interaction between disability, handicap and impairment can be explained in the following manner. Impairment is the medical condition-, disability is the functional effect-, and handicap is the social consequence. See also Disability and Handicap.
Incapacity
Incapacity in this Report refers to a person’s inability to undertake paid work (employment or self-employment) arising from a disability.
Negligence
The term negligence can be used to describe a person’s failure to act carefully. It also refers to the common law negligence action. To succeed in such an action it is necessary to prove that the defendant has failed to act carefully.
No-Fault Compensation
No-fault compensation is provided in a scheme for accident victims or their families without the need for a claimant to prove that the accident was caused by another person’s fault. In a no-fault compensation scheme, it is not usually necessary to take legal proceedings in order to make a claim for compensation.
Non-Economic Loss
Non-economic loss refers to those consequences of an injury which have no monetary equivalent. The non-economic loss compensated at common law includes pain and suffering, loss of amenities and enjoyment of life and loss of expectation of life. See also Economic Loss.
Pay-As-You-Go Scheme
Pay-as-you-go insurance scheme operates on a cash flow basis, premium, income in each year being the source of pay-outs for that year. No substantial reserves are maintained to take account of outstanding claims, the cost of which must be met in future years. See also Funded Scheme.
Set-Off
This word is used in two different ways. In an action to recover money, a set-off is a cross-claim for money by the defendant which, if successful, will extinguish the whole or part of the plaintiff’s claim. Secondly, the term can be used in an action for damages where the plaintiff has received benefits from other sources as a result of the injury in respect of which the legal proceedings are brought. If those benefits are subtracted from the damages otherwise recoverable, they are said to have been “set off”. The term is generally used in the second sense in this Report.
Strict Liability
A tort of strict liability is one which does not depend upon proving that the defendant was at fault in order to establish liability. A person may therefore be liable to pay damages in a tort of strict liability even though he or she has acted with all reasonable care.
Table of Maims
This phrase refers to a table which specifies the amount of compensation payable to a person for particular injuries, such as the loss of a limb. A table of this kind is used in the New South Wales workers’ compensation system for non-economic loss.
Tort
Tort is a civil right of action for damages available to a person sustaining injury or loss as the result of the acts or omissions of another person. A tort does not include a breach of duty arising from a contract.
FOOTNOTES
1. Actuary’s Report, para.2.6.
2. For further definitions of this term, see Australian Bureau of Statistics, Handicapped Persons Survey 1981, Cat No.4343.0, p.173; and Australian Council for Rehabilitation of Disabled and the International Year of Disabled Persons National Committee of Non-Government Organisations, Income Security Policies for Mentally and Physically Disabled People in Australia (Discussion Paper 1981) para.2.3.
3. See Australian Bureau of Statistics, note 2 above, p.174.
