Broad causation test reinforces NDIA recovery powers

A decision by the Administrative Review Tribunal on 21 November 2025 reinforces the entitlement of the National Disability Insurance Agency (NDIA) to recover payment for previous National Disability Insurance Scheme (NDIS) supports following settlement, when it is determined that the impairment of the plaintiff was "to any extent" caused by the alleged personal injury at the centre of their compensation claim.

Background

Susanne Jenkins (Applicant), a recipient of NDIS funding due to a right leg amputation and obesity, issued proceedings in the District Court of Western Australia against her orthopaedic surgeon for alleged negligence causing personal injury, including the amputation. The claim was settled out of court by way of a deed of release, which denied liability but provided the Applicant with compensation. The deed included provisions for reimbursement to the NDIA.

The NDIA issued a recovery notice to the surgeon's insurer, seeking reimbursement of $296,810.33 for NDIS supports provided to the Applicant up to the day before the date of settlement.

The Applicant challenged this, arguing as follows.

• Her amputation was likely inevitable regardless of any negligence by the surgeon.
• The compensation she received should not be treated as payment for NDIS supports but rather characterised as compensation for "other consequences of her personal injuries", including "pain, suffering, and disability", which would arguably fall beyond the scope of s 107(1) of the National Disability Insurance Scheme Act 2013 (Cth) (Act).
• There was no causal link between the alleged negligence and her impairment.

Expert reports in the underlying proceeding were tendered, which mostly concluded that earlier intervention by the surgeon had a less than 50% chance of saving the Applicant's leg.

Key findings

The Tribunal considered whether the NDIA's decision to recover the cost of NDIS supports was consistent with the Act. The key consideration was whether the impairment was caused "to any extent" by the alleged injury, regardless of whether liability was admitted.

The Tribunal found that the NDIA can recover funds it has expended from the participant's NDIS supports for an impairment that was caused, to any extent, by a personal injury and causation on the "balance of probabilities" need not be satisfied.

As such, the compensation settlement, even with the denial of liability, was found to be linked to the injury and subsequent impairment. As such, the Recovery Notice in the sum of $296,810.33 was not set aside.

Conclusion

Ultimately, the Tribunal affirmed the NDIA's decision to recover the cost of NDIS supports. A settlement that denies liability does not prevent the NDIA from seeking recovery of support costs, as the Tribunal found that a causal link between the injury and impairment, even if small, is enough to satisfy the statutory requirement under s107(1)(a) of the Act.

Take away

This case applies a broad test of causation to demonstrate that a connection between a plaintiff's injury and subsequent impairment is enough to maintain recovery for NDIS supports, even if the connection is not established "on the balance of probabilities" and liability has been denied.

This case highlights the difficulties that can arise in the context of a settlement when a plaintiff has settled their claim but is also liable for a significant NDIA repayment, which is not reduced to account for matters such as liability risk or causation. It will be important for plaintiffs' claims to be properly and realistically articulated from the outset with respect to the primary injuries claimed and particulars of special damage to promote meaningful settlement negotiations and avoid plaintiffs being surprised by a recovery notice.

While providing reassurance for defendants and insurers that plaintiffs will not be permitted to "double dip", this case could make settlement negotiations more challenging if there is a significant repayment owing to the NDIA that must be repaid out of any settlement sum.

The authors acknowledge and thank Ava Conway, Paralegal's contribution to the article.