Compensation to relatives claims

The amount of compensation that can be claimed on the death of a loved one depends on the circumstances of how the injury was sustained. This also affects the legislation which may apply, although compensation to relatives in New South Wales is mainly governed by the Compensation to Relatives Act 1897 (NSW).

A compensation to relatives claim can cover economic losses, including lost wages, earnings and superannuation. It can also cover medical and funeral expenses.

In addition, if psychological injuries – such as depression or post-traumatic stress - were sustained by you or by family members of the deceased as a result of the shock of your loved one’s death, you may be entitled to bring a compensation claim in your own right. This will be assessed similarly to a personal injury claim, with damages able to be claimed for economic and non-economic losses, as well as medical expenses.

The courts have a wide discretion afforded to them in assessing how compensation to relatives claims are assessed, in what can often be a difficult exercise. It is difficult to predict with any degree of certainty how a court may decide on the various pieces of evidence that make up a dependency claim. Stacks lawyers can help you decide the best methods to use in calculating a dependency claim, depending on your circumstances.

Stacks are “no win no fee” lawyers for many types of compensation claims. To find out more if that arrangement can apply to your claim, or if you need to speak to a personal injury lawyer about a compensation to relatives claim, please call us today.

To find out more about the types of personal injury claims that Stacks Law Firm can assist you with, please visit these pages:

Who can bring a compensation to relatives claim?

The Compensation to Relatives Act determines who can bring a claim in respect of a wrongful death of a relative. The parties may include the spouse, children and any other close relatives of the deceased, or anyone who was financially dependent on the person at the time of their death. Only one action is permitted. Once damages are determined, the amount will be divided among the parties to the action, in amounts to be decided by the court.

If your claim is unsuccessful, however, you may still be required in certain circumstances to pay the professional fees and disbursements incurred by your opponent. We will not pass on to you the costs we incurred running the case.

If you decide to stop your claim or move your claim to another law firm, you may need to pay the costs of running your claim up to that point.

What can be claimed in a compensation to relatives claim?

Compensation to relatives claims can cover economic losses, such as lost wages or earnings (including pensions) and superannuation, as well as losses incurred through medical and funeral expenses. The principle behind the loss of financial support is that the relative would have expected to derive a benefit from the deceased, had the accident not occurred and had the deceased lived.

This loss of income and financial benefit can be claimed into the future, and does not need to be based on a legal entitlement, but merely that the claimant had an expectation of voluntary contribution from the deceased.

Compensation claims can cover domestic services claims, for example, household chores or services that had been provided by the deceased. It can also cover nervous shock claims, which are for psychological injuries sustained by family members as a result of their relative’s death. Claims for nervous shock can similarly cover economic and non-economic losses, for your own medical expenses and lost earnings as a result of your relative’s death.

How are dependency claims calculated?

Establishing dependency claims can be complicated, as there are a number of methodologies used by the court to determine dependency claims. The courts have noted on numerous occasions that an assessment of dependency claims cannot be made by any meaningful arithmetical or actuarial calculation. However, some reasonable inferences and assessments must be made in order to reach a reasonable assessment of damages.

The first step is to calculate the probable earnings of the deceased. This is calculated in a similar way to economic loss in any personal injury matter. The second step is to establish the dependency of the claimants on the deceased relative’s income, taking into account children under the age of 18 and the length of time they will require support.

One of the most common methods used by the court is to rely upon the average expenditure of all groups in the Household Expenditure Survey performed by the Australian Bureau of Statistics. However, where the deceased’s income is significantly higher or lower than average, an alternative method could be considered, such as referencing payments made from the deceased’s estate following the death, or by providing an established history of expenditure, supported by loan or mortgage repayments and bank statements, for example.

Stacks lawyers can help you to determine the best method for calculating dependency claims, based on your relevant circumstances.

What can be claimed with domestic services?

Claims can also be made by relatives for domestic services that were previously provided by the deceased, such as for household maintenance, babysitting and handyman tasks. If the deceased had trade qualifications, the commercial value of those services could be claimed on the basis that those services would have been carried out by the deceased at no cost to the relatives, if not for the accident.

What about estate benefits and third party payment offsets?

In taking into account the loss of financial benefits you have suffered, it will be necessary to offset any “benefits” that you have obtained as a result of the death. This most often includes any amounts recovered in relation to the deceased’s estate.

By way of basic example, if your dependency claim equates to $400,000, but you received $300,000 from the estate, your dependency claim will be reduced by the amount of this benefit to $100,000.

Similarly, if you receive financial support from a third person, such as a new spouse, this financial benefit must be offset against the amount of the loss you claim arising from the death.

How are insurance policies (eg life insurance) dealt with in terms of an estate benefit?

While ordinarily benefits received by dependents following a death must be taken into account when calculating the dependency claim, this excludes insurance policies and superannuation payouts, whether they are the form of a life insurance policy, income protection, life assurance or payment from a superannuation fund.

These payments are not treated as estate benefits or third party payments. In other words, receipt of these payments will not reduce the claimable damages.

How is the matrimonial home dealt with in terms of an estate benefit?

In accordance with a number of court decisions, including the High Court in Parker v Commonwealth and other similar authorities, the general rule is that no deduction to a spouse’s damages is made in relation to the passage of a matrimonial home owned by the deceased. This is because the remaining spouse merely continues to enjoy as an owner what he or she previously enjoyed as a spouse.

There are some exceptions to this rule, and it is important to seek legal advice in relation to your particular circumstances before a claim is made.

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No hidden fees

We’ll always be honest and upfront. We’ll look you straight in the eye and agree on a plan before moving forward.

Deep expertise

We know the ropes and our professionals have expertise specific to every legal situation—many are Accredited Specialists.

Practical advice not legalese

We speak clearly and directly, so you understand our advice and can make decisions with confidence.

Network of local offices

We’re local to wherever you are, and our offices are owned and operated by friendly, local professionals, proud of their communities.

Real client care

We genuinely care about our clients. It’s the core of who we are and has been since the first practice was opened by ER Stack on the NSW Mid-North Coast in 1931.

Progressive practise

We make the process easy for you with the latest tech to keep services cost effective—and you in control.