AAI Ltd v Hoblos

AAI Limited, the insurer, brought an application to the Supreme Court of New South Wales to determine if a psychological injury suffered by Ms Hoblos met the threshold criteria for compensation under the Motor Accident Injuries Act 2017. Ms Hoblos had been involved in four motor accidents within a short timeframe, with a prior history of psychological issues. The court needed to ascertain whether these injuries met the statutory definition of a "threshold injury" under the Act and whether the insurer was liable to provide compensation.

The court examined the statutory framework and case law to determine the test for causation of psychological injury in motor accident claims. It considered the principles set out in the SIRA Motor Accidents Guidelines (Version 9.1, commencement on 1 April 2023) and the applicability of common law principles. It rejected the argument that the principles in State Government Insurance Office v Oakley should apply, instead favouring the approach in Slade v Insurance Australia Ltd. The court also referred to Briggs v IAG Ltd (No 2) and the observations of Windeyer J in Federal Broom Co Pty Ltd v Semlitch. The decision hinged on whether Ms Hoblos's psychological injury was a "direct consequence" of the motor accidents, and whether these accidents were a "significant contributing factor" to her condition.

The court concluded that Ms Hoblos's psychological injury did meet the criteria for a threshold injury under the Act. The multiple motor accidents, occurring in a short period and coupled with her prior psychological history, were deemed to have a significant contribution to her current condition. Therefore, the insurer was found liable to provide compensation. The original assessment that revoked the claim was revoked by the court, and the insurer was ordered to pay compensation for the psychological injury sustained by Ms Hoblos.