AAI Limited t/as GIO v McCrohon
[2025] NSWPIC 190
•1 May 2025
| CERTIFICATE OF DETERMINATION OF MEMBER | |
| CITATION: | AAI Limited t/as GIO v McCrohon [2025] NSWPIC 190 |
| CLAIMANT: | Louis John McCrohon |
| INSURER: | AAI Limited t/as GIO |
| SENIOR MEMBER: | Brett Williams |
| DATE OF DECISION: | 1 May 2025 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017 (MAI Act); statutory benefits disputes involving sections 1.9, 3.1, 3.11, 3.28, and 3.39 of the MAI Act and section 30 of the Civil Liability Act 2002; factual dispute about circumstances of accident; proceedings settled between the parties; costs order sought by claimant under section 8.10(4) and by insurer under section 8.3(4) of the MAI Act; San v Rumble (No 2), Ho v Professional Services Review Committee No 295, AAI Ltd trading as GIO v Moon, and Grinter v CIC Allianz Insurance Limited applied; Held – exceptional circumstances exist that justify payment of the claimant’s costs; payment of the reasonable and necessary legal costs incurred by the claimant in connection with the proceedings in accordance with section 8.10(4)(b) of the MAI Act permitted; payment of the insurer’s reasonable legal costs permitted. |
| DETERMINATIONS MADE: | Exceptional circumstances exist that justify payment of the claimant’s costs; payment of the reasonable and necessary legal costs incurred by the claimant in connection with the proceedings in accordance with s 8.10(4)(b) of the MAI Act permitted. Payment of the insurer’s reasonable legal costs permitted under s 8.3(4) of the MAI Act. |
REASONS AND ORDERS
These proceedings were commenced by AAI Limited t/as GIO (insurer) and relate to a claim for statutory benefits made by Louis McCrohon (claimant) under the Motor Accident Injuries Act 2017 (MAI Act) following an accident at Goulburn on 28 January 2021 (accident).
The proceedings are listed for hearing on 13 May 2025, and involve disputes about:
(a) whether ss 1.9 and 3.1 of the MAI Act are engaged;
(b) whether, for the purposes of s 3.11 and s 3.28 of the MAI Act, the accident was caused wholly or mostly by the fault of the claimant;
(c) the application of s 3.39 of the MAI Act, and
(d) whether s 30 of the Civil Liability Act 2002 applies to the claim.
In addition to these legal disputes, there is a factual dispute about the circumstances in which the accident occurred.
Preliminary conferences were conducted on 4 November 2024 and 10 February 2025. NSW Police have produced documents under direction, including body worn camera footage recorded at the scene of the accident.
The parties have informed the Commission that the matters in dispute have been resolved. The proceedings were listed today to confirm the orders sought by the parties, including orders with respect to costs.
As the orders sought with respect to costs involve the exercise of a discretion by the Commission my reasons for making those orders follow. The orders were made after hearing oral submissions from the parties in relation to costs. Neither party objected to the costs order sought by the other.
The parties agreed that rather than the proceedings being dismissed, as initially proposed, they are discontinued by the insurer.
COSTS
Claimant’s costs
The claimant seeks an order under s 8.10(4) of the MAI Act permitting payment of the reasonable and necessary legal costs he incurred in connection with the proceedings over and above those permitted by the regulations.
The Commission can make the order sought by the claimant only if satisfied that exceptional circumstances exist that justify payment of the costs he has incurred: s 8.10(4) MAI Act.
To be “exceptional circumstances” the circumstances must be unusual or out of the ordinary, whether as a result of qualitative or quantitative factors. The case need not be one that is unique, unprecedented, or very rare. The question is determined on the basis of the facts of the individual case: San v Rumble (No 2) [2007] NSWCA 259 at [67].
Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors, or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional: Ho v Professional Services Review Committee No 295 [2007] FCA 388 at [26].
In AAI Ltd trading as GIO v Moon [2020] NSWSC 714, Wright J said that s 8.10(4) of the MAI Act can be seen as designed to deal with particular, unusual situations where the maximum costs fixed by the Regulations may not be adequate. Wright J held at [99] that:
“…other cases can be envisaged which are exceptional, because they involve an unusual degree of factual or legal complexity or for some other reason, and this requires the incurring of more substantial legal costs by a claimant. These cases fall within s 8.10(4).”
I have taken into consideration:
(a) the factual matters in dispute;
(b) the legal issues in dispute, and
(c) my assessment of the legal work undertaken in connection with the proceedings, including the preparation of written submissions.
I have also taken into consideration that the claimant was represented by Senior Counsel. I am satisfied that retention of Senior Counsel by the claimant was appropriate, reasonable and necessary having regard to the complexity of the matters in dispute.
All these matters, when taken together, have led me to the conclusion that exceptional circumstances exist that justify payment of the claimant’s costs.
The Commission permits the payment of the reasonable and necessary legal costs incurred by the claimant in connection with these proceedings in accordance with s 8.10(4)(b) of the MAI Act.
Insurer’s costs
The insurer seeks a costs order under s 8.3(4) of the MAI Act and relies on the reasons of Wright J in Moon at [127]-[128]. The insurer argues that, having regard to the complex legal and factual issues that arose in the proceedings, the Commission should exercise its discretion to make the order it seeks.
In Grinter v CIC Allianz Insurance Limited [2024] NSWPIC 267 Member McTegg said this:
“[150]… In circumstances where it has been found that exceptional circumstances exist so as to justify an order in favour of the claimant under s 8.10(4)(b) it is also appropriate to exercise its discretion under s 8.3(4). Indeed, that is an appropriate yardstick by which to assess whether the Commission’s discretion should be exercised.”
I respectfully agree with Member McTegg.
I am satisfied that for the purposes of s 8.3(4) of the MAI Act, the Commission should permit payment of the insurer’s reasonable legal costs for legal services provided to it in connection with the proceedings. The circumstances that I have earlier found constitute “exceptional circumstances” for the purposes of s 8.10(4)(b) underpin my finding in this regard.
ORDERS AND NOTATIONS
I note that the statutory benefits dispute has resolved.
The proceedings are discontinued.
The hearing on 13 May 2025 is vacated.
Payment of the reasonable and necessary legal costs incurred by the claimant in connection with the proceedings over and above those permitted by the regulations is permitted under s 8.10(4) of the MAI Act.
For the purposes of s 8.3(4) of the MAI Act payment of the insurer’s reasonable legal costs for legal services provided to it in connection with the proceedings is permitted.
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