ACI v AAI Limited t/as GIO - [2021] NSWPICMR 36

CERTIFICATE OF DETERMINATION OF MERIT REVIEWER
CITATION:	ACI v AAI Limited t/as GIO [2021] NSWPICMR 36
CLAIMANT:	ACI
INSURER:	AAI Limited t/as GIO
MERIT REVIEWER:	Terence O'Riain
DATE OF DECISION:	17 August 2021
CATCHWORDS:	MOTOR ACCIDENTS- Merit Review; whether for the purposes of section 8.10 of the Motor Accident Injuries Act 2017, claimant’s legal costs and expenses incurred are reasonable and necessary; Medical Assessor assessed claimant; claimant’s lawyers’ tax invoice seeking maximum costs under Motor Accidents Injuries Regulation 2017; insurer claimed costs claimed were excessive; providing claimant’s statement to Medical Assessor not reasonable or necessary; insurer offered part of maximum costs; reduced availability of costs discourages legal participation; costs not contingent on successful outcome; fixed costs; legal costs; lack of exceptional circumstances under section 8.10(4)(a); no costs for merit review; Held- insurer’s decision set aside, costs assessed at maximum for medical assessment.
DETERMINATIONS MADE:	The reviewable decision is about whether for the purposes of section 8.10 of the Act costs and expenses incurred by ACI are reasonable and necessary and is therefore a merit review matter under Schedule 2(1) (aa) of the Motor Accident Injuries Act2017 (the MAI Act). 1. The reviewable decision is set aside and in substitute the decision is to pay ACI costs to the maximum regulated amount. 2. The amount of the Claimant’s costs assessed in accordance with the Motor Accident Injuries Regulation 2017 is $1,826 inclusive of GST.

Background

There is a dispute between ACI’s lawyer and the insurer about whether for the purposes of section 8.10 of the MAI Act costs and expenses incurred by ACI are reasonable and necessary.
In accordance with Sch. 2 cl.1(aa) of the MAI Act the costs dispute is a merit review matter.
I am satisfied that sufficient information has been supplied to the Commission in connection with the dispute and that the proceedings can be determined on the papers.
On 1 June 2018 ACI was injured in a motor accident (the accident) as a passenger.
On 21 October 2019 the Claimant’s lawyers lodged a dispute with the DRS to assess whether or not the Claimant had a minor injury to decide if benefits would continue past 26 weeks in accordance with ss 3.11 and 3.28 of the MAI Act.
This was against a background of the Claimant seeking an internal review outcome ACI’s injury status.
ACI, among other injuries, instructed his legal representatives to allege that the accident had caused a right hip fracture and soft tissue injuries.
The fracture if accepted would have led to an assessment that would have satisfied the sections regarding continuing benefits.
The insurer’s decision was delayed due to the pressure of other requests for internal reviews, which lead to ACI’s lawyers proceeding to the DRS, MAS to expedite resolution.

On 22 September 2020, Medical Assessor Home issued his minor injury assessment of the Claimant, determining that accident did not cause the Claimant’s right hip injuries.
The Claimant’s legal representatives issued a tax invoice dated 18 November 2020 to the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] NSWPICMR 36
Decision Date: 17 August 2021

CaseChat Overview and Summary

In the matter of ACI versus AAI Limited trading as GIO, the dispute was centred on the interpretation and application of section 8.10 of the Motor Accident Injuries Act 2017. The respondent, AAI Limited, had assessed the legal costs and expenses incurred by the claimant as being less than the maximum allowed under the Motor Accidents Injuries Regulation 2017. The claimant, represented by their lawyers, argued that the costs should be assessed at the maximum regulated amount. The case was brought before the court for a merit review to determine whether the insurer's decision to limit the costs was reasonable and necessary, as required by the legislation.

The court had to decide whether the claimant's legal costs and expenses were reasonable and necessary for the purposes of section 8.10 of the Motor Accident Injuries Act 2017. The key legal issues included the determination of what constitutes reasonable and necessary costs, the role of the Medical Assessor in assessing such costs, and the impact of the insurer's decision on the claimant's ability to seek legal representation. The court also had to consider whether there were any exceptional circumstances under section 8.10(4)(a) that would warrant a deviation from the maximum regulated amount.

In reaching its decision, the court found that the claimant's lawyers' tax invoice seeking the maximum costs under the Motor Accidents Injuries Regulation 2017 was reasonable and necessary for the purposes of section 8.10 of the Motor Accident Injuries Act 2017. The court held that providing the claimant's statement to the Medical Assessor was not reasonable or necessary, but this did not affect the overall assessment of the costs. The court also noted that the insurer's decision to offer only part of the maximum costs would discourage legal participation, as the costs were not contingent on the successful outcome of the claim. The court set aside the insurer's decision and assessed the claimant's costs at the maximum regulated amount, finding that there were no exceptional circumstances under section 8.10(4)(a) that would warrant a deviation from this amount. The court's decision was based on the principle that fixed costs do not necessarily preclude them from being reasonable and necessary.

The final orders of the court were that the reviewable decision of the insurer was set aside, and in its place, the decision was to assess the claimant's costs at the maximum regulated amount. The amount of the claimant's costs assessed in accordance with the Motor Accident Injuries Regulation 2017 was $1,826 inclusive of GST. The court considered the application, reply, and supporting documentation in making its decision. The court's ruling was based on the principle that the claimant's legal costs and expenses were reasonable and necessary for the purposes of section 8.10 of the Motor Accident Injuries Act 2017, and that the insurer's decision to limit the costs was not in line with the legislation.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

The reviewable decision is set aside and in substitute the decision is to assess ACI costs at the maximum regulated amount. The amount of the Claimant’s costs assessed in accordance with the Motor Accident Injuries Regulation 2017 is $1,826 inclusive of GST. In making this decision, I have considered the following:· The application, reply and supporting documentation· the MAI Act

Ratio Decidendi

Legal Principle Established

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