What is the Arik Decision and Why is It Important?

When you’re injured and seeking compensation in Victoria, a Medical Panel assessment can determine whether you qualify for damages. In 2023, a Court of Appeal decision known as the Arik decision changed how Medical Panels assess lower limb injuries – impacting every WorkCover, TAC, and public liability claim in Victoria.

But what is Arik, and how does it affect your ability to reach the compensation thresholds? In this guide, we’ll share everything you need to know.

Key Insights

• The Arik decision (Vicinity Centres PM Pty Ltd v Arik [2023] VSCA 295) is a Victorian Court of Appeal ruling about how Medical Panels should assess lower limb impairments using the AMA Guides
• The Court ruled that Medical Panels can use the “highest impairment” method rather than combining all ranges of motion deficits when assessing hip injuries
• This decision affects whether injured Victorians meet the impairment thresholds needed to claim compensation for pain and injuries
• It applies to all personal injury claims in Victoria, whether you’re injured at work, in a transport accident, or in a public place

What is the Arik Decision?

The Arik decision refers to the Victorian Court of Appeal case Vicinity Centres PM Pty Ltd v Arik [2023] VSCA 295, decided on 5 December 2023. Ms Arik had slipped and fallen at Broadmeadows Shopping Centre on 1 December 2019, suffering a hip injury. When she tried to claim compensation under the Wrongs Act, a Medical Panel assessed her whole person impairment (WPI) at 4% – below the 5% threshold needed to claim damages for pain and suffering.

Here’s where Arik becomes crucial: Ms Arik challenged the Medical Panel’s assessment method through judicial review. She argued the Panel had incorrectly interpreted section 3.2e of the American Medical Association Guides to the Evaluation of Permanent Impairment 4th Edition (the AMA Guides), which Victorian Medical Panels use to assess all injury claims.

The case travelled through three court levels:

1. Supreme Court (March 2023): Justice Richards found the Medical Panel had not applied the AMA Guides properly, stating it should have combined all ranges of motion restrictions rather than taking the highest rating. Under this approach, Ms Arik’s WPI would have been 14%.
2. Court of Appeal (December 2023): By majority, the Court of Appeal overturned the Supreme Court’s decision, holding that the Medical Panel’s assessment was in accordance with the Guides. The Panel’s method (taking the most severe impairment rating) was acceptable.
3. High Court (May 2024): On 9 May 2024, the High Court refused an application by Ms Arik for special leave to appeal from the Court of Appeal’s judgment.

Understanding the Arik decision means recognising it’s the final word on how Medical Panels assess lower limb injuries in Victoria (at least for now).

The Key Legal Issue: Combining vs Highest Impairment

The technical question at the heart of what Arik is seems narrow, but its impact is massive. When a Medical Panel assesses a hip injury, they measure range of motion in multiple directions – flexion, extension, abduction, adduction, and rotation. Each direction can be classified as mild, moderate, or severe impairment.

The Medical Panel assessed Ms Arik’s injured hip and found five planes of motion were impacted: two were “moderate” and three were “mild”. They then took the highest classification (moderate) and assigned her 4% WPI based on that single rating.

Ms Arik’s legal team argued this was wrong. They contended that each impairment of range of motion should have been combined, consistent with other sections of the AMA Guides that state, “if the patient has several impairments of the same lower extremity part, the whole-person estimates for the impairments are combined”.

The difference is enormous:

• Highest impairment method: 4% WPI (below threshold)
• Combined method: 14% WPI (well above threshold)

The Court of Appeal majority sided with the Medical Panel’s approach. They held that the Guides, on a proper construction and taking into account their context, did not require all impacted planes of motion to be assigned an impairment figure and then added together.

Why Arik Decisions Are Important for Injured Victorians

Why Arik decisions are important comes down to one word: thresholds. In Victoria, you can’t claim compensation for pain and suffering or loss of enjoyment of life unless your injuries meet specific whole person impairment thresholds:

• Wrongs Act claims (public liability, medical negligence): More than 5% WPI for most injuries
• WorkCover serious injury claims: 30% WPI or significant impairment of a body function
• TAC serious injury claims: Serious long-term impairment or loss of body function

The AMA Guides are used to assess impairment for all injury types in Victoria, whether you’re injured in a public space, at work, or in a transport accident. The Arik decision affects every one of these claims.

Understanding why the Arik decision is important means recognising that this case determines whether thousands of injured Victorians will qualify for compensation.

How the Arik Decision Affects Your Claim Today

Now that the High Court has refused to hear the appeal, the Arik decision is settled law in Victoria. Here’s what it means if you’re pursuing a personal injury claim:

For Lower Limb Injuries

If you’ve injured your hip, knee, or ankle and you’re assessed by a Medical Panel, they’ll use the “highest impairment” method when evaluating range of motion restrictions. Your WPI percentage will likely be lower than if all your movement restrictions were combined.

For Other Body Parts

The Arik decision specifically addressed lower extremity assessments under section 3.2e of the AMA Guides. The methodology for assessing other body parts hasn’t changed. However, the Court’s reasoning about how to interpret the AMA Guides could influence future cases involving other body systems.

For Workplace Injuries

If you’re a workplace injury lawyer with a Melbourne client, the Arik decision affects whether you’ll reach the 30% WPI threshold for a WorkCover serious injury application. Lower limb injuries assessed using the “highest impairment” method may not reach this threshold as easily.

For TAC Claims

The decision impacts whether you’ll meet the definition of serious injury for fair compensation for transport accidents. Lower limb injuries resulting from car accidents are common, and how your impairment is assessed can significantly impact the value of your entire claim.

For Public Liability Claims

Under the Wrongs Act 2015 amendments, you need more than 5% WPI to claim compensation for pain and suffering. The Arik decision makes it harder for some lower limb injuries to reach this threshold.

The practical impact? You need experienced legal representation who understands how Medical Panels apply the AMA Guides post-Arik. Your lawyer should review any Medical Panel assessment carefully, checking that measurements were taken correctly and that the Panel applied the methodology consistently with the Court of Appeal’s interpretation.

Get Expert Guidance on Your Injury Claim

The Arik decision shows how technical legal interpretations can have massive real-world consequences for injured people. A difference in how you measure a hip injury can mean the difference between qualifying for compensation and walking away with nothing.

Medical Panel assessments can determine whether your claim succeeds or fails. After the Arik decision, it’s more important than ever to have legal representation that understands how impairment thresholds work across WorkCover, TAC, and Wrongs Act personal injury claims.

At Henry Carus + Associates, we’ve helped hundreds of injured Victorians navigate the Medical Panel process and challenge assessments that don’t accurately reflect their injuries. If you’ve been injured and you’re concerned about reaching impairment thresholds, we’ll review your medical evidence, advise you on your prospects, and fight to ensure you receive every dollar you’re entitled to.