Overpayments and recoveries
The TAC will consider recovery of no-fault benefits and common law damages in accordance with the guidelines below.
There are a number of situations where the TAC has the right to recover amounts paid in respect of injury or death resulting from a transport accident.
Recovery of overpayments
What is an overpayment?
An overpayment occurs when a payment is made by the TAC in respect of a claim or services provided directly to the TAC which is more than the amount which is due.
Who can the TAC seek recovery of an overpayment from?
The TAC may recover an overpayment from a:
- service provider
When will an overpayment be recovered?
The TAC may recover an overpayment caused by:
- incorrect or incomplete information being supplied
- errors made by the TAC, such as data entry errors or duplicate payments (the payment is processed twice)
- the client, service provider, supplier or contractor is slow (or fails) to advise of a change in circumstances
- the TAC is slow (or fails) to process a change in circumstances
- deception or fraud.
How will a person be notified of an overpayment?
If the TAC believes an overpayment has occurred it will generally send a letter informing:
- that an overpayment has occurred and explaining the reason why
- of the amount overpaid and how it is calculated
- who to contact at the TAC to discuss the method of repayment.
In cases where an overpayment has occurred because of fraud, the TAC can recover the overpayment in criminal proceedings. Refer to the TAC Compliance and Enforcement policy.
Transport Accident Act 1986 reference:s.116 and s.117A
Recovery of no-fault benefits from non-TAC indemnified party
Can the TAC seek recovery from other parties?
The TAC pays benefits regardless of fault but when an accident is caused by a party not indemnified by the TAC, the TAC can recover its no-fault payments from the non-TAC indemnified party. The amount that can be recovered is limited to the extent of that party's fault for the accident.
Transport Accident Act 1986 reference: s.104(1)
The parties from whom the TAC commonly seeks recovery include:
- drivers and owners of Commonwealth and Interstate registered vehicles (i.e. the accident is caused by a vehicle registered in another State, Territory or by the Commonwealth)
- drivers and owners of other unindemnified vehicles (i.e. vehicles where the transport accident charge has not been paid)
- owners of domestic or farm animals (e.g. an accident is caused by a cow wandering on to a road)
- authorities responsible for road design and maintenance (e.g. an accident is caused by incorrect signage or a dangerous road surface)
- motor vehicle repairers and manufacturers (e.g. an accident is caused by a defective part or poor mechanical workmanship).
Recovery of common law damages (unauthorised or intoxicated drivers)
Can the TAC recover from a driver who is not authorised to use the vehicle which has caused the accident?
The TAC can recover the amount of the common law award or settlement and costs from the driver providing the driver did not have reasonable grounds for believing that the owner had given authority to use the vehicle.
For example, the TAC can recover from the driver of a stolen vehicle who has caused an accident which injures another person.
Transport Accident Act 1986 reference: s.102(1)
Can the TAC recover from a driver who is convicted of certain offences as a result of the accident circumstances?
The TAC can recover the amount of the common law award or settlement and costs from the driver if the conviction is for:
- an offence involving alcohol or drugs under section 49(1)(a) of the Road Safety Act 1986, such as being in charge of a motor vehicle while intoxicated and being incapable of having proper control of the vehicle, or
- a serious indictable offence as defined in section 325 of the Crimes Act 1958, such as culpable driving or dangerous driving causing death or serious injury.
Transport Accident Act reference: s. 102(2)
What is an unindemnified vehicle?
A motor vehicle is unindemnified if it is a Victorian motor vehicle and no transport accident charge has been paid to cover the date of the transport accident. The transport accident charge must be paid prior to the expiry date or within 28 calendar days of the expiry date of the registration of the motor vehicle. Refer to the Indemnity provided by the Transport Accident Charge policy and the VicRoads website.
Can the TAC recover if a vehicle does not have a current transport accident charge?
In Victoria the transport accident charge is payable at the same time that the motor vehicle's registration is due. A vehicle is unindemnified if the transport accident charge has not been paid. Refer to the Indemnity provided by the Transport Accident Charge policy. Transport Accident Act 1986 reference: s.94(1)
If an accident has been caused by the driving of an unindemnified motor vehicle the TAC is required to pay common law damages directly to the injured person. The TAC can then recover the amount of the common law award or settlement and its legal costs from the driver or owner of the unindemnified vehicle. Transport Accident Act 1986 reference: s.96(3)
When will the TAC not seek to recover from the driver or owner of an unindemnified motor vehicle?
Unless the TAC has the right to recover under other sections of the TAA 1986, the TAC will not seek to recover from:
- the owner of a motor vehicle if the reason for the vehicle being unindemnified was through no fault of the owner. Transport Accident Act 1986 reference: s.96(4)(a)
- the driver if the driver had reasonable grounds to believe that the vehicle was indemnified (although this does not apply if the driver is convicted in relation to the accident of a drink-driving offence). For example, an employer informs an employee that a charge has been paid in respect of a vehicle which the employee is asked to drive. Transport Accident Act 1986 s.96(4)(b)(ii)
Recovery of no-fault benefits from awards made outside of Victoria
Can the TAC recover from a person who has two claims in two jurisdictions for the same accident?
A person cannot be compensated twice for injuries received in the same accident. The TAC may recover the payments it has made in relation to a claim where the injured person receives or is about to receive compensation or damages for a claim made in a place outside of Victoria. A place outside of Victoria refers to interstate, the commonwealth or overseas. A place outside of Victoria can include a claim made with an interstate insurer, or a law of the Commonwealth such as the Consumer and Competition Act 2010. Transport Accident Act 1986 reference: s.42(3)
For example, a driver of Victorian vehicle might receive injuries in an accident in NSW. The driver can claim compensation from the TAC but may also be able to claim compensation or damages in NSW. If the driver has received TAC compensation then the TAC may recover that amount if the driver later obtains compensation or damages from a third party in NSW (such as the driver of a NSW registered vehicle).
Refer to the Interstate (Non Victorian) accidents policy.