Abo v AAI Ltd t/as GIO
[2021] NSWPICMR 21
•18 June 2021
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| CITATION: | ABO v AAI Ltd t/as GIO [2021] NSWPICMR 21 |
| APPLICANT: | ABO |
| RESPONDENT: | AAI Ltd t/as GIO |
| MERIT REVIEWER: | Brett Williams |
| DATE OF DECISION: | 18 June 2021 |
| CATCHWORDS: | MOTOR ACCIDENTS- Merit review; statutory benefits in respect of death under section 3.1 of the Motor Accident Injuries Act 2017; grandmother died as a result of injuries; claimant a minor; psychological injury; close family member under the Civil Liability Act (CLA); Adjustment Disorder; “close member of the family”; parental responsibility; grandmother had prominent role in the girl’s upbringing and well-being; a single mother; day-to-day parental responsibility; consideration of the relationship in question as a whole is required; ‘second parent’ satisfies s 30(5)(c) of the CLA; Held- insurer is not entitled to refuse payment of statutory benefits; legal costs; exceptional circumstances exist. |
| DETERMINATIONS MADE: | 1. The Insurer’s decision of 17 July 2020 is set aside. 2. ABO is a close member of the family of the late KP for the purposes of s 30(2)(b) of the Civil Liability Act 2002. 3. The Insurer is not entitled to refuse payment of statutory benefits to ABO in accordance with Part 3 of the Civil Liability Act 2002 as applied by s 3.39 of the Motor Accident Injuries Act 2017. 4. ABO is entitled to recover statutory benefits for pure mental harm arising from mental or nervous shock in connection with the death of KP in a motor accident on 1 April 2020 in accordance with Part 3 of the Motor Accident Injuries Act 2017. 5. ABO is entitled to recover from the Insurer her reasonable and necessary legal costs in connection with this merit review matter in the amount of $5,000 plus GST. |
BACKGROUND
The claim
On the morning of 1 April 2020 KP was riding a bicycle through a roundabout located at the intersection of George, Hereford and Stanley Streets, Bathurst, when a vehicle collided with her (’the accident’). KP died as a result of injuries sustained in the accident.[1]
[1] A notice issued by the Coroners Court on 5 May 2020 recorded that the direct cause of KP’s death was a traumatic brain injury. The notice also recorded that the inquest into KP’s death had been suspended as the Coroner had formed an opinion that the evidence established an indictable offence against a known person. The known person was the driver of the vehicle involved in the accident.
ABO is KP’s granddaughter. Following the death of her grandmother, ABO, a minor, developed a psychological injury that required treatment[2]. She subsequently submitted a claim for statutory benefits under the Motor Accident Injuries Act 2017 (MAI Act) to AAI Limited t/as GIO, the insurer of the at fault vehicle involved in the accident (‘the Insurer’).
[2] Certificate of Capacity and Fitness of Dr J.M Corbett-Jones dated 21 May 2020. Dr Corbett-Jones certified that ABO suffered psychological injury as a result of her grandmother’s death. He diagnosed Adjustment Disorder and recommended psychological counselling.
By letter dated 29 June 2020 the Insurer denied ABO’s claim on the basis that she was not a close member of KP’s family for the purposes of s 30(2)(b) of the Civil Liability Act 2002 (CLA).
An internal review of the Insurer’s decision was issued on 17 July 2020. The internal reviewer determined that:
(a) ABO does not meet the definition of ‘close family member’ in accordance with the Civil Liability Act 2002 (NSW).
(b) The statutory benefits claim up to 26 weeks from the date of the accident for the pure mental harm claim lodged pursuant to Part 3 of the CLA is denied.
(c) ABO is not entitled to the payment of weekly benefits and may not recover treatment and care expenses.
Implicit in the Insurer’s decision is that the psychological injury ABO suffered constituted ‘mental harm’ for the purposes of the MAI Act and CLA. The Insurer has not disputed that ABO suffers from Adjustment Disorder as a consequence of her grandmother’s death.
The critical issue for determination is whether ABO satisfies s 30(5)(c) of the CLA and is therefore a close member of the family of KP for the purposes of s 30(2)(b) of the CLA. If so, she will be entitled to benefits in accordance with Part 3 of the MAI Act.
Transitional matters
The Personal Injury Commission (the PIC) was established on 1 March 2021. These proceedings were commenced on 25 February 2021, before the PIC was established. In accordance with Sch 1 Part 2 cl 14A and cl 14B of the PIC Act 2020, they constitute pending proceedings and pre-establishment proceedings that I am empowered to determine.
The proceedings
The dispute constitutes a merit review matter for purposes of Part 7 Division 7.4 of the MAI Act.[3]
[3] Sch 2 cl 1(t) MAI Act.
At a teleconference held on 6 May 2021 the parties agreed that the matter should be determined on the papers. Having considered s 52 of the Personal Injury Commission Act 2020 and Procedural Direction PIC2, I am satisfied that sufficient information has been supplied in connection with the dispute and that the proceedings can be determined on the papers.
RELEVANT STATUTORY PROVISIONS
Claims for statutory benefits are governed by Part 3 of the MAI Act. Section 3.1 is the gateway to accessing statutory benefits. The section reads as follows:
“3.1 Statutory benefits payable in respect of death or injury resulting from motor accident
(1) If the death of or injury to a person results from a motor accident in this State, statutory benefits are payable in respect of the death or injury as provided by this Part.
(2) Statutory benefits are payable (except as otherwise provided by this Part)-
(a) whether or not the motor accident was caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle, or
(b) even if the motor accident was caused by the fault of the person to whom the statutory benefits are payable.”
Statutory benefits are payable subject to the other provisions in Pt 3.
ABO’s psychological injury constitutes mental harm. As a result, s 3.39 of the MAI Act applies to her claim. That provision states:
“3.39 Limitation on statutory benefits in relation to certain mental harm
Part 3 (Mental harm) of the Civil Liability Act 2002 applies to the payment of statutory benefits under this Part in connection with an injury in the SPe way as it applies to the award of damages in connection with an injury, subject to any necessary modifications and to any modifications prescribed by the regulations.”
The regulations referred to in s 3.39 are found in Pt 3 cl 8 of the Motor Accident Injuries Regulation 2017. There is nothing in the Regulations that is relevant to the resolution of this dispute.
Central to the dispute in these proceedings are s 30(2) and (5) of the CLA. s30 states relevantly as follows:
“30 Limitation on recovery for pure mental harm arising from shock
(1) This section applies to the liability of a person (“the defendant” ) for pure mental harm to a person ("the plaintiff") arising wholly or partly from mental or nervous shock in connection with another person ("the victim") being killed, injured or put in peril by the act or omission of the defendant.
(2) The plaintiff is not entitled to recover damages for pure mental harm unless--
(a) the plaintiff witnessed, at the scene, the victim being killed, injured or put in peril, or
(b) the plaintiff is a close member of the family of the victim.
(3) …
(4) …
(5) In this section--
"close member of the family" of a victim means--
(a) a parent of the victim or other person with parental responsibility for the victim, or
(b) the spouse or partner of the victim, or
(c) a child or stepchild of the victim or any other person for whom the victim has parental responsibility, or
(d) a brother, sister, half-brother or half-sister, or stepbrother or stepsister of the victim.
"spouse or partner" means--
(a) the person to whom the victim is legally married (including the husband or wife of the victim), or
(b) a de facto partner,
but where more than one person would so qualify as a spouse or partner, means only the last person to so qualify.”
While s 30(2) refers to ‘damages’ that word should be replaced, for the purposes of this dispute, with the term ‘statutory benefits’.[4] The provision limits the class of person who can recover statutory benefits for pure mental harm. Because she does not satisfy s 30(2)(a) of the CLA, ABO must establish that she was a close member of the family of KP in order to satisfy s 30(2) and establish an entitlement to recover statutory benefits. This means that she must come within one of the defined categories contained in s 30(5).
[4] Section 3.39 states that Pt 3 of the CLA applies to the payment of statutory benefits under that Part in the SPe way as it applies to the award of damages in connection with an injury, subject to any necessary modifications. Replacing the word ‘damages’ with the term ‘statutory benefits’ is such a necessary modification.
ABO argues that she satisfies s 30(5)(c), in that she was a person for whom KP had parental responsibility. The Insurer argues to the contrary.
THE EVIDENCE
ABO’s statement
In support of her claim, ABO provided a statement dated 27 May 2021. Therein she states, relevantly:
“4. I am the daughter of SP and granddaughter of KP. I referred to my grandmother as Omar.
5. I would see and speak with Omar, every day.
6. Omar lived across the road from school and every day we would go to her house and she would feed us, and take us to karate, and take us to mum’s shop. In the mornings, I would go to her house before school, before the bell went.
7. I went to the pool with Omar almost every day in summer. I just enjoyed spending time with her.
8. Each afternoon, Omar would help by taking us shopping, or taking us to karate or going to the pool. She would make us dinner a lot as mum worked late. She would buy us clothes if we needed them.
9. Omar was like a second mum to me. As mum was a single mum and working long hours in the barber shop, Omar was like a second parent to ABN and myself.
10. There are no words to describe how I felt when I found out about Omar’s passing. It all happened so quickly, it was hard to process.
11. I had about 6 weeks off school at the start and I am not going to school as much. I now find it hard to get things done and concentrate on home work and things like that. I assume it has impacted on my grades, although I have not got my reports yet.
12. I feel unmotivated.
13. Sometimes I become sad and teary, and more than I like to admit.
14. I sometimes get cranky and frustrated, for not having Omar around to talk to.
…”
In addition to her own statement, ABO relies on statements from the following:
(a) Joint statement of JY, SK, MM, MR, MW and BH (joint statement), undated.
(b) EP (undated).
(c) SK (undated).
(d) RW dated 30 June 2020.
(e) WH (undated).
(f) Dr Corbett-Jones dated 18 June 2020.
(g) Her mother, SP, dated 27 May 2021.
I have read and considered all the statements. While I do not intend to re-produce the statements in full, the following extracts drawn from the statements will assist in understanding the context in which the dispute arises and the reasons for my decision.
(a) “KP supported her daughter, SP (a single parent), who took over the running of the hairdressing business in its operation but most especially in looking after SP’s teenage daughters, ABN and ABO. Without KP’s commitment the girls would have been relegated to latch-key children. The girls came to KP’s home each afternoon after school and would always engage actively with them. KP was also available to provide support for SP when either of the girls was ill.
This unwavering commitment on KP’s part has built a firm bond between them. In the event of an emergency KP would drop whatever she was engaged in and come to the rescue. KP was the primary carer for the girls during school holidays. She provided a clear ethical framework for the girls blended with a wry sense of humour to maintain a strong connection.”[5]
[5] Joint statement.
(b) “She was however most devoted to her family, and had a very close relationship with her daughter SP and her two granddaughters ABO and ABN who lived in Bathurst. SP is a single parent, and works full time to support her girls and KP became her main support with regards to helping raise the children and provide extra assistance. KP played a prominent role in the girl’s upbringing and well-being. She saw them every day, before and after school 5 days a week, plus regular weekends visit’s and overnight stays. She was a committed and consistent influence and was helping shape their future by providing another strong role model in their life…
She was also the primary contact for the girl’s school and outside school activities, including karate, gym and swimming 3-4 times a week…
During the period of school holidays, she became their primary care giver, looking after them and often taking them away including trips to the Gold Coast, Sydney and Melbourne…”[6]
[6] Statement of EP.
(c) “KP went well beyond what would normally be regarded as the expectation in caring, mentoring and generally serving as a rock to her daughter SP (a single mother and owner of a busy small business), and her grand daughters, ABN and ABO.
KP looked after ABN and ABO every afternoon after school and during each school holidays. This was clearly vital to SP in enabling her to operate and grow her business, particularly with the great reassurance knowing that her daughters were in the loving care of her mother.
As the vibrant and energetic person she was KP did not regard these occasions as simple baby-sitting times; she seized upon them as opportunities to impart life lessons, ethical guidance along with intellectual stimulation. This interaction was peppered with exercise and jobs for the girls, all the time delivered with KP’s wicked sense of humour. Unsurprisingly this combination of so many hours together, close collaboration, wise counsel consistently spiced up with fun, wisdom and unrelenting commitment to her daughter and grand daughters built a powerful bond.
Rather than being a grand parent, who can give the kids back when the going gets tough KP was their second parent. On one occasion when ABN badly injured her hand KP took on the problem organising, attending medical appointments with ABN, both in Sydney and in Bathurst, while providing strong emotional support to her grand daughter through the ordeal. This level of care and engagement had the additional benefit of freeing SP to operate her business with the confidence that her child was receiving the best possible support through this trying time.”[7]
[7] Statement of SK.
(d) “KP was vibrant, active and joint carer in a parental role to her two grandchildren ABO and ABN, as KP was the pivotal second parent to her grandchildren…While SP took on the responsibility to work and generate income as a single parent, KP took on the responsibilities of looking after ABO and ABN for when SP was not able to meet ABO and ABN’s commitments due to SP’s work responsibilities. ABO and ABN’s father had remarried and has four children to his second marriage leaving little time in external support to ABO and ABN, KP stepped in for SP to fill this loss for ABO and ABN’s.
Responsibilities that I personally witnessed KP taking on for ABO and ABN extended to picking up and dropping off at high school …KP would care for them after school and also ensure that ABO and ABN have obtained black belts, a feat that would not have been made possible without the parental dedication of KP.
I personally witnessed KPs presence for years bringing ABO and ABN to Karate lessons and waiting and encouraging her granddaughters from the sitting area in the Karate Dojo. I myself have trained at the same Karate club that ABO and ABN train with for over 15 years and I have watched ABO and ABN train hard throughout the years and push themselves to physical and emotional limits to achieve their black belt status. Without KPs assistance this would not have been possible. I would often sit and chat with KP during lesson breaks and KP always had food prepared for ABO and ABN and I admired KPs love and dedication she would display to her granddaughter every time. KP was there not just to meet the physical needs, but also was an emotional support for her granddaughter while SP worked to meet the financial commitments needed to support her family.
The sudden loss of KP has not only been a devastating emotional loss to all of KPs family members who loved her dearly, but has also placed SP, ABO and ABN into an unexpected financial situation. KPs sudden death has brought on financial hardship and pressure for SP as the parental role that KP undertook to support her family has now been fully placed on SP. SP has had to cut back her working hours by reducing the number of days that she can work at the barbers, while now taking on the responsibilities that KP managed for SP while she was working. I know this to be the case as I have attended the barber shop where KP first originally cut my hair until her retirement, when SP took over the role. I have been in close contact with SP through her role as my barber and SP’s shifts have been cut back significantly due to KP’s sudden passing.[8][8] Statement of RW dated 30 June 2020.
(e) “I have known KP for more than forty years….
To state that KP was just close to her grandchildren, ABO and ABN would be an understatement. KP’s daughter SP has been a single parent for most of her daughters lives so KP’s role was not just that of grandmother. She functioned as another parent. ABO and ABN spent much of their lives with their Grandmother KP whom they loved very much.
KP picked them up from school, helped them with homework, brought them to training (she was a constant presence at the Dojo), prepared their meals and tucked them into bed at night. She helped them to set goals and encouraged them to do the work to achieve them. She had the wisdom to know when they needed a cuddle and when they just needed to get a push back onto the training mat. KP spent lots of time talking and listening to ABO and ABN.”[9]
[9] Statement of WH
(f) “This is to certify that as the General Practitioner for KP and SP, and ABN and ABO; I was aware of the care that was provided for the two daughters by their Grandmother, KP.
She was the person to accompany them to medical appointments and I was aware from general discussions that KP was deeply and inherently involved in their day to day care.”[10]
[10] Statement of Dr Corbett-Jones dated 18 June 2020.
In her statement dated 27 May 2021, ABO’s mother SP provided the following evidence:
“5. I am a small business owner, being a Barber. I own xxx Barbers located at yyy Street, Bathurst. Mum opened the business in 1991. I took over the business about 8 years ago and started managing it, and I took ownership of it, about 2 years ago…
6. Leading up to mum’s passing on 1 April 2020, I was working 6 days a week Monday to Saturday. I would start about 8.30am and finish around 5.30pm but not leave the shop until around 6.30pm or 7.00pm. I also employed two staff. One of them, had been there for 2 years, and the other, I got in September 2019…
12. I would see mum every day. In the mornings, the girls would go to mum’s house before school as their school is located across the road from her house. During the day, mum would come into the shop and bring me in coffees and lunch. Mum would pick the kids up from school each day and I would pick the kids up from mums, most afternoons/evenings. Mum would cook for me and the girls, and we would have dinner at her place most evenings…
13. Mum and I were very close. She was definitely my plus one, as far as parenting goes, and I would have described her as my best friend…
15. Financially, I relied on mum quite a lot, and she bought a lot of the kids clothing wise, and do the grocery shopping for us as well. Money wise, she spent on the kids really, which helped me a lot and she would feed us basically every day…
50 I was relying on mum to help me raise the kids. Being a single mum is hard and now I have no support, and feel like I am going to fail essentially. I relied on mum so much, emotionally, financially and physically, even with things like driving the kids around, and now everything is so much harder. It was never meant to be like this.”
SUBMISSIONS
ABO’s submissions
The submissions relied on by ABO with respect to the substantive issues are dated 1 June 2021. In summary, she submits that:
(a) The evidence is unequivocal in confirming that KP had day-to-day parental responsibility for ABO.
(b) The definition to which the insurer refers is contained within s 61B of the Family Law Act 1975 (FLA). However, importantly, that definition contains the words ‘In this Part’ at the commencement of the definition within that section. This means that the definition being relied upon by the Insurer, as the definition for the purposes of the CLA, is itself self-limiting to only being the definition in respect of Part VII of the FLA. There is nothing within the FLA which states the definition therein applies to the CLA. There is nothing within the CLA which directs the reader to the FLA.
(c) The Insurer’s reliance upon the FLA to define parental responsibility has been selectively chosen as the definition contained within the FLA appears to support the Insurer’s proposition. That proposition, however, has several shortcomings for the following reasons:
(i)The purpose of the definition within the FLA is to clearly define that the natural parents of the child have parental rights unless there has been some other form of legal intervention.
(ii)This is completely inconsistent with the wording of s 30(5)(c) of the CLA as that section describes a close family member as either a child or stepchild (consistent with the family law definition) but then it goes on to say that it also includes any other person for whom the victim has parental responsibility.
(iii)The specific wording within s 30 in the alternative is not filial for a specific reason; it is to allow the court or assessor to consider all of the facts before them, utilise common sense and exercise their discretion.
(d) The Insurer has been unable to locate any common law specifically dealing with this issue under s 30(5)(c). If they were able to locate SPe, they would have presumably relied upon such authority instead of the definition within the FLA.
(e) While unable to locate specific case law addressing s 30(5)(c), there is High Court authority which supports the proposition that KP having parental responsibility for her enlivens the discretion allowed under s 30(5)(c).
(f) The following comments of McHugh J in Gifford v Strang Patrick Stevedoring Pty Ltd [2003] HCA 33 are referred to:
“48. It is the closeness and affection of the relationship – rather than the legal status of the relationship – which is relevant in determining whether a duty is owed to the person suffering psychiatric harm. The relationship between two friends who have lived together for many years may be closer and more loving than that of two siblings. There is no policy justification for preventing a claim for nervous shock by a person who is not a family member but who has a close and loving relationship with the person harmed or put in peril. In a claim for nervous shock at common law, the reasonable foresight of the defendant extends to all those with whom the victim has or had a close and loving relationship.”
(g) In making this important point McHugh J also referred in his judgment to the comments of Lord Keith of Kinkel in Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310 as follows:
"The kinds of relationship which may involve close ties of love and affection are numerous, and it is the existence of such ties which leads to mental disturbance when the loved one suffers a catastrophe. They may be present in family relationships or those of close friendship … It is common knowledge that such ties exist, and reasonably foreseeable that those bound by them may in certain circumstances be at real risk of psychiatric illness if the loved one is injured or put in peril. The closeness of the tie would, however, require to be proved by a plaintiff, though no doubt being capable of being presumed in appropriate cases.”
(h) There is no doubt the claim falls directly into the category of claims upon which both McHugh J and Lord Keith were referring in their judgments.
(i) She has unequivocally proven by copious evidence her significantly close relationship with KP and the fact that KP had parental responsibility for her.
(j) The first step to determine the meaning of parental responsibility within the CLA is to look at the Act itself. However, it contains no specific definition.
(k) The next step is to look at the common law for guidance and interpretation. Neither party has been able to locate a precedent which would provide guidance as to the specific term of parental responsibility within the context of the CLA. There is, however, High Court authority for the proposition that the parental responsibility relationship between ABO and KP is specifically the type of relationship that has been accepted for many years in Australia as a nervous shock claim. There is nothing within the CLA that excludes the relationship between ABO and KP once it is accepted that KP had parental responsibility for ABO.
(l) Once the Insurer accepted KP had parental responsibility for ABO, and could not locate any definition within the CLA or any precedent which set out the definition, it should have accepted the claim, instead of looking for favourable definitions within the FLA.
(m) At all material times KP had parental responsibility for ABO. Therefore, ABO is entitled to bring her claim as a close family member pursuant to s 30(5)(c) of the CLA.
The Insurer’s submissions
The Insurer has provided submissions dated 29 March 2021 and 8 June 2021. The following is a summary of those submissions.
(a) Section 30 of the CLA prescribes that a claim for pure mental harm arising from shock can only be made if you have either witnessed the accident or if you are a close family member of the victim. As ABO did not witness the subject accident, the entitlement to a pure mental harm claim is dependent on whether her relationship with KP falls within the scope of a ‘close member of the family’ of KP.
(b) Section 30(5) of the CLA defines a close member of the family of a victim as a child or stepchild of the victim or any other person for whom the victim has ‘parental responsibility’ (c) or ‘a brother, sister, half-brother or half-sister, or stepbrother or stepsister of the victim’(d).
(c) The statements and references documented in the ‘Facts’ section of the internal review decision undoubtedly evidences KP’s support and dedication to ABO’s upbringing and wellbeing, which resulted in a strong bond. The statements and references provided detail the multitude of parental responsibilities that KP took on, including caring ‘before and after school 5 days a week’, being the ‘primary contact’ for school and outside activities and the main caregiver during school holidays where she looked after ABO and took her on trips. KP assumed responsibilities such as driving to and supervising extra-curricular activities and took a proactive and enthusiastic approach in ensuring ABO received support as required. The statements are consistent that KP’s death has had a significant emotional impact, as well as a financial burden on ABO’s mother as the ‘parental role that KP undertook to support the family has now been fully placed on SP’.
(d) Although the Insurer accepts the assertion that KP occupied the role of a ‘second parent’, ‘parental responsibility’ in the context of the CLA is limited to its legal denotation. Under Family Law legislation, ‘parental responsibility’ means all the duties, powers, responsibilities, and authority, which, by law, parents have in relation to children. Unless a court order specifically provides to the contrary, each parent of a child under 18 years of age has parental responsibility. Unlike parents, Family Law legislation does not make any presumptions in relation to parental responsibility in relation to grandparents.
(e) In effect, s 30 of the CLA establishes a clear limitation on those persons who can bring a claim for pure mental harm. That is, the application of ‘parental responsibility’ is limited to the legally vested responsibility imbued on a child’s parents.
(f) The Insurer is therefore barred from applying discretion in the reading of what ‘parental responsibility’ constitutes. As such, the Insurer is therefore of the view that despite the undoubtedly close relationship with KP and the parental ‘role’ she assumed, the absence of legally vested ‘parental responsibility’ excludes ABO from the definition of a ‘close family member’ under the CLA.
(g) The decision of the GIO Claims Team to deny the statutory benefits claim for pure mental harm pursuant to Part 3 of the CLA ought to stand.
(h) In its submissions, the Insurer also refers to the reasons provided by the internal reviewer, including the following:
“It is therefore clear that a strong bond had been established between you and the deceased, who had occupied a central role in your upbringing and care. Although the writer accepts the assertion that the deceased occupied the role of a ‘second parent’, ‘parental responsibility’ in the context of the Civil Liability Act is limited to its legal denotation…”.
Consideration
As recorded earlier in these reasons, the critical issue for me to determine is whether ABO was a person for whom KP had parental responsibility in accordance with s 30(5)(c) of the CLA.
There is no relevant definition of ‘parental responsibility’ contained in either the CLA or the MAI Act. Neither party has been able to identify any authority that addresses the construction of the term for the purposes of s 30(5)(c).
ABO submits that it is a factual issue that must be determined on a case by case basis. The Insurer submits that the definition contained in the FLA should be applied.
Does the FLA definition apply?
Section 61B of the FLA is found in Part VII Division 2 of the FLA. That Division deals with the concept of parental responsibility including, in particular: what parental responsibility is; and who has parental responsibility[11] for the purposes of the FLA. The section is in the following terms:
“61B Meaning of parental responsibility
In this Part, parental responsibility, in relation to a child, means all the duties, powers, responsibilities and authority which, by law, parents have in relation to children.”
[11] s 61A FLA
The definition explicitly states that it relates to Pt VII of the FLA, commencing with the words “In this Part…”.
ABO submits that as the definition in s 61B commences with the words ‘In this Part’ it is self-limiting and only applies to Pt VII of the FLA. I agree. In my view, the definition of ‘parental responsibility’ in s 61B of the FLA relates to entirely different subject matter, and is applied in an entirely different context, to the term as it is used in s 30 of the CLA. Although it may be stating the obvious, the s 61B definition is applied in a family law context while the use of the term in s 30 is in the context of a claim for compensation for mental harm. The subject matter to which the term is applied is materially different, as are the two Acts.
Part 3 of the CLA, including s 30, is incorporated into Part 3 of the MAI Act. ABO’s claim has been made under the MAI Act. The subject matter, rights and duties dealt with in the MAI Act, like the CLA, are very different to those addressed in the FLA. By way of illustration, the objects of the MAI Act include “…to encourage early and appropriate treatment and care to achieve optimum recovery of persons from injuries sustained in motor accidents…”.[12] This is not subject matter to which the FLA is directed.
[12] See s 1.3(2)(a).
I agree with ABO’s submission that the words ‘…or any other person for whom the victim has parental responsibility’ in s 30(5)(c) is intentionally not filial to allow the issue to be determined on a case by case basis.
Unlike Pt 3 of the CLA[13], the definition of ‘parental responsibility’ found in s 61B of the FLA is not expressly said to apply to a statutory benefits claim under Pt 3 of the MAI Act, claims for statutory benefits being governed by that Part[14].
[13] Ref s 3.39 MAI Act.
[14] See AAI Limited trading asGIO v Moon [2020] NSWSC 714 (Moon) at [31].
Section 61B is not explicitly incorporated into s 30 of the CLA. There is no reference in that regard in either the FLA or the CLA. Further, in my view the definition is not implicitly incorporated into s 30.
Having regard to all these matters, I have concluded that that the definition of ‘parental responsibility’ in s 61B of the FLA does not apply to the claim.
Was ABO a person for whom KP had parental responsibility?
It is neither possible nor appropriate for me to definitively define ‘parental responsibility’ for the purposes of s 30(5)(c) of the CLA. Nor is it possible for me to formulate an exhaustive list of matters or indicia that should be taken into account when determining the question. Looking to individual factors or elements in isolation will never tell the whole story. Consideration of the relationship in question as a whole is required. The question should be determined on a case by case basis.
In my view, the question of whether ABO was a person for whom KP had parental responsibility is to be determined by reference to the totality of their relationship. I agree with the Insurer’s submission that:
“The statements and references provided detail the multitude of parental responsibilities that the deceased assumed, including caring ‘before and after school 5 days a week’, being the ‘primary contact’ for school and outside activities and the main caregiver during school holidays where she looked after the Claimant and took them on trips. The deceased assumed responsibilities such as driving to and supervising extra-curricular activities and took a proactive and enthusiastic approach in ensuring the Claimant received support as required. The statements are consistent in reporting that the death of the deceased has imparted a significant emotional impact, as well as a financial burden on the Claimant’s mother as the ‘parental role that KP undertook to support the family has now been fully placed on SP’.”[15]
[15] See Insurer’s submissions 29 March 2021 at par 16 and 8 June 2021 at par 9.
I also agree with the Insurer that KP occupied the role of a ‘second parent’ to ABO.[16] Although not determinative of the issue, a number of the statements relied on by ABO refer to KP taking on ‘the role of a parent’.
[16] See Insurer’s submissions 29 March 2021 at par 17 and 8 June 2021 at par 10.
Important context is provided by RW in his statement of 30 June 2020 as follows:
“ABO and ABN’s father had remarried and has four children to his second marriage leaving little time in external support to ABO and ABN, KP stepped in for SP to fill this loss for ABO and ABN’s. KP filled the void left by the absence of ABO’s father.”
When looked at in the context of SP raising ABO and her sister as a single mother, the following matters, when taken together, have led me to conclude that at the time of her death KP did have, and took, parental responsibility for ABO:
(a) KP prepared her meals.
(b) KP provided her with moral and ethical guidance.
(c) KP took her to and from school.
(d) KP took her to sporting events, including karate.
(e) KP ‘tucked her in to bed at night’.
(f) KP took care of her when she was unwell.
(g) KP helped ABO set and achieve goals.
(h) KP was instrumental in developing ABO’s character.
(i) KP was a role model to ABO.
(j) KP looked after ABO so that ABO’s mother, SP, could generate income for the family.
(k) KP was her primary carer during school holidays.
(l) KP would accompany her to medical appointments and was “deeply and inherently” involved in her day to day care.
(m) SP relied on KP to help her raise ABO.
I am satisfied that the role played by KP in ABO’s life was such that ABO was a person for whom KP had parental responsibility at the time of her death. I find that, for all intents and purposes, KP fulfilled the role of a second parent to ABO. The responsibilities she took for ABO were consistent with those typically reserved to a parent. Those responsibilities ranged from clothing and feeding her to providing moral and ethical guidance. The responsibilities KP took for ABO allowed ABO’s mother SP to run her business. KP made a critical contribution to the running of the household
I find that ABO satisfies s 30(5)(c) of the CLA. As a corollary, I find that ABO is a “close member of the family” of KP for the purposes of s 30(2)(b) of the CLA.
The Insurer is not entitled to refuse payment of statutory benefits to ABO in accordance with Part 3 of the Civil Liability Act 2002 as applied by s 3.39 of the Motor Accident Injuries Act 2017. Having satisfied s 30(2)(b) of the CLA ABO is entitled to recover statutory benefits in accordance with, and subject to, Pt 3 of the MAI Act.
Legal costs
ABO seeks an order that the Insurer pay her legal costs in connection with the claim. She argues that:
(a) She is entitled to an award for her costs and disbursements beyond the regulated fees prescribed by the MAI Act and Regulations.
(b) In accordance with Moon she is entitled to an award for her costs and disbursements regardless of whether she is successful or unsuccessful in these proceedings.
(c) In accordance with Moon and s 8.10 (4)(b), exceptional circumstances exist which allow the Commission to permit the payment of her legal costs above the regulated costs.
(d) The following factors exist which can be considered as exceptional circumstances:
(i)The claim gives rise to a complex set of factual and legal circumstances which are outside the ordinary.
(ii)The Insurer denied liability on the basis that ABO was not a close family member within the meaning of s 30 of the CLA.
(iii)Following this denial, she was required to obtain statements to prove and substantiate her claim. The totality of this task would have taken not less than four to five hours.
(iv)In addition to the statements, she was required to also obtain numerous other factual evidence documents to support and substantiate the relationship.
(v)The basis of the denial by the Insurer, their internal review certificate and their submissions required her lawyers to undertake significant case law research which took in the order of two to three hours to complete to ascertain whether any significant precedent existed to easily clarify the dispute between the parties.
(vi)A significant amount of legal work was required in relation to the proceedings including the initial application, teleconference, multiple teleconferences with the Claimant, the Claimant’s tutor, witnesses, correspondence and drafting very detailed submissions which were eight pages in total.
(e) The legal work required and undertaken in the prosecution of this dispute has exceeded the maximum costs allowed under the regulations by many multiples. The time taken in total for this dispute would exceed 10 hours.
(f) There are clear exceptional circumstances that exist in relation to this application. An order is sought pursuant to s 8.10 (4)(b) of the MAI Act.
The Insurer has not made any submissions in relation to costs.
ABO is entitled to recover from the Insurer the reasonable and necessary legal costs, and other costs and expenses, incurred by her in connection with the claim[17] but only if payment is permitted by the Regulations or the Commission.
[17] See s 8.10(1).
This matter is a merit review matter[18] and a ‘regulated merit review matter’.[19] The Regulations allow for payment of legal services provided in relation to the matter up to a maximum of 16 monetary units[20]. The present regulated maximum for legal costs is $1,660.00.[21]
[18] Sch 2 cl 1(t) MAI Act.
[19] Sch 1 cl 1(2)(d) of Regulations 2017.
[20] Sch 1 cl 1(1).
[21] 16 x $103.76.
The Commission can permit payment of legal costs incurred by ABO but only if satisfied that she is under a legal disability or exceptional circumstances exist that justify payment of legal costs incurred by her.[22]
[22] Section 8.10(4).
In my view, both pre-conditions are met. ABO is a minor. Accordingly, s 8.10(4)(a) applies as she is a person under legal incapacity[23]. Further, I have concluded that exceptional circumstances exist such that s 8.10(4)(b) is also satisfied.
[23] Being a child under the age of 18 years. See definition of ‘person under legal incapacity’ in s 3 Civil Procedure Act 2005
While not purporting to cover the field in relation to what constitutes ‘exceptional circumstances’ for the purposes of s 8.10(4)(b), Wright J in Moon[24] held that the:
“…power to permit payment of costs can be seen as designed to deal with particular, unusual situations where the maximum costs fixed by the regulations may not be adequate.”
[24] Moon at [97]. (see footnote 13 above)
He went on to say at [99]:
“…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).”
The following considerations have led me to the conclusion that exceptional circumstances exist:
(a) The dispute involved an unusual degree of factual and legal complexity. Neither party was able to identify any authority addressing the s 30(5)(c) CLA issue.
(b) Significant legal work, including research and the preparation of statements, was required.
(c) Detailed submissions were provided, including with respect to the application of s 61B of the FLA to the claim.
Taking all these matters into account I have determined that ABO’s reasonable and necessary legal costs in relation to this matter are $5,000 plus GST. She is entitled to recover those costs from the Insurer.
Brett Williams
Member – Motor Accidents Division | Merit Reviewer
Personal Injury Commission
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