Are Personal Injury Claim Settlements Confidential?

People who are injured are rightly concerned about what information becomes publicly available when they make a personal injury compensation claim. Sometimes, this is because of the unfortunate stigma that can be associated with compensation claims, and sometimes an injured person will not want their friends, family, work colleagues or neighbours knowing if they received compensation, and how much they received.

So as personal injury experts we are frequently asked, “who gets to find out about my personal injury compensation claim?”

Part of the answer to this question depends on whether the claim for compensation resolves by way of a settlement agreement, or by way of a judgment from a Court, where the matter went to a hearing.

Court hearings are stressful, costly and, unless the Court sees a good reason for keeping the Court closed or the proceedings confidential, they are also public. Along with many other types of Court hearings, personal injury claim hearings are also frequently reported on by journalists and open to the public to attend.

The legal system in Victoria operates on the assumption of “open justice”, meaning that Court cases are to be held in pubic unless there are exceptional circumstances.

So, if a Court awards an injured person compensation, there is nothing to stop the decision of the judge or the jury being on the front of the newspaper the next day.

Court hearings are rare in personal injury compensation claims, meaning that the vast majority of people injured in Victoria have their claims resolve prior to going to a full hearing.

Most compensation claims resolve by negotiation (also called a “settlement”). Settlements can occur at any time before a Court reaches its decision, and can be made between parties at any stage in a case – even before Court documents have been lodged.

Settlements for personal injury compensation claims generally come with terms and conditions which the injured person accepts in return for the payment of compensation. The settlement and its terms and conditions are usually captured in a Deed of Release, which is signed by all parties to the claim.

Some terms and conditions in a Deed of Release are common. For instance, there may be a requirement that the injured person is prevented from making future compensation claims in relation to the same injuries.

Others terms and conditions are less common. For instance, there may be a requirement that the injured person will not “disparage” (or say negative things) about the Defendant.

The terms of a Deed of Release are up to the parties to agree – although some of the common terms will be considered “non-negotiable” by Defendants and their insurers in Victorian personal injury claims.

Confidentiality clauses in personal injury Deeds of Release are very common. Most prevent the injured person from disclosing the terms of the settlement (i.e the fact that they got compensation, or the amount of compensation) except as required by law. Other terms may prevent the injured person from disclosing the personal injury claim at all.

A breach of these terms can result in a Defendant seeking to reclaim compensation from the injured person for breach of the Deed.

Even if a compensation settlement does not come with a requirement of confidentiality, you should still tell as few people as possible.

We’ve seen a number of occasions where compensation which is meant to last a lifetime is wasted or spent by “new friends” taking advantage of the injured person.

Generally, it is a good idea for you to tell your accountant or financial advisor about the compensation, because there can be tax consequences and tax effective ways to invest the compensation amount. If you don’t have a financial advisor or accountant, you should get one and seek advice about investment of the compensation.

You should also tell any lawyers you have engaged – for instance, your compensation claim may affect the legal advice given to you in relation to your Will, family law or other areas of your legal life.

Lastly, if you are a Centrelink recipient or NDIS participant, you should inform them of your compensation award. Receiving compensation as a result of a personal injury can impact your entitlement to Centrelink and NDIS benefits.

The law in this area is complex. Poor or incomplete advice in relation to the resolution of your personal injury compensation claim can result in you receiving less compensation in your hand, and can result in you having to repay money after the claim is resolved.

Get expert advice in relation to your potential claim for compensation to ensure that you’re been guided in the right direction.