A woman who was violently abused as a baby is appealing an ACC decision not to give her cover because she has no memory of what happened.
In a newly-released appeal decision, the District Court in Wellington sided with ACC. The woman's lawyer, John Miller, has filed an appeal in the High Court.
Mr Miller said it was a test case that could open the law up to other claimants affected by historical abuse or injuries.
In 1979, when the woman was three months old, her skull was found to be broken and x-rays showed it was highly likely both her legs had also suffered fractures.
Doctors considered it lucky she did not suffer brain damage.
She was placed in foster care and by the age of two her injuries had healed.
At five, her foster parents told her about the abuse and her injuries.
In 2012, she told a psychiatrist all her life she has believed her birth mother "wanted her dead".
She now suffers from depression, a psychological pain disorder, and has been unable to hold down a steady job. Her name is suppressed.
After ACC declined her application for cover, she took her case to the District Court.
A doctor has diagnosed her past injuries and abuse as contributing to her depressive disorder.
"The adoptive mother appears to have made an early link between the original injuries from the birth mother; every time she took her along for childhood consultations regarding the childhood onset leg pain that she experienced, the early physical abuse/injuries were mentioned," the doctor said.
"[This] had a significant psychological impact on her from a young age - from the time she was told about it by the adoptive parents. The way this information was handled and relayed to her was possibly/probably done with insufficient awareness of the psychological impact on a young person who was already in a relationship with birth mother, the original perpetrator".
Her lawyer, John Miller, told the District Court she "is reminded daily and thinks about the physical injuries she suffered and the consequences of these physical injuries, and this is what causes her mental injury".
However, Judge Denese Henare ruled a "direct causative link must exist between the physical injury and the mental injury in order to achieve cover".
"In this case, there is no connection between the physical injury and the mental injury because the appellant has no recollection or memory of the physical injuries."
Mr Miller said he was disappointed, but prepared to take the case "all the way" as he feels ACC does not fully take into account the psychological effects of injuries.
"ACC has adopted quite a narrow and restrictive interpretation of the law by saying a mental injury must be directly caused by a physical injury," he said.
"The Court of Appeal really needs to look at this."
Health system absolved of blame
Mr Miller also argued the case should have been judged under the law according to the old 1972 ACC Act, rather than the current, and "stricter", 2001 Act.
Despite her application not being filed before 2001, Mr Miller told the court what is now known as the Ministry of Social Development should have applied for ACC cover when the woman was a baby.
"There is no doubt the medical records show the woman comes within the older legislation... the fact an application wasn't made on her behalf as a state ward shows a failing by the Government to help her," he said.
However, the District Court also ruled the woman was treated appropriately within the public health system.
There is no date yet for the appeal in the High Court.