Allen v AAI Limited t/as GIO
[2023] NSWPICMR 48
•8 September 2023
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| CITATION: | Allen v AAI Limited t/as GIO [2023] NSWPICMR 48 |
| CLAIMANT: | Joshua Allen |
| INSURER: | AAI Limited t/as GIO |
| MERIT REVIEWER: | Terence O'Riain |
| DATE OF DECISION: | 8 September 2023 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; costs; reasonable and necessary costs; under schedule 2(1) (aa); statutory benefits; permanent impairment and treatment disputes; section 3.27; regulated costs; damages claim resolved; on the papers; correct and preferable; claimant presses for payment of 50% of disbursements which claimant submits were referable in equal amounts to settled damages claim and the treatment dispute, which is a statutory matter under clause 8.10 of the Motor Accident Injuries Regulation 2017; insurer's submits disbursements were resolved on an inclusive of costs basis in the damages settlement; Merit Reviewer does not have jurisdiction to assess and award legal costs for a permanent impairment dispute; permanent impairment application costs ‘dispute’ cannot be referred to the Commission; Held – Merit Reviewers do not have jurisdiction to determine costs dispute connected with whole person impairment assessment; application is without substance because the matters in dispute have been resolved between the parties; proceedings dismissed under section 54(b) of the Personal Injury Commission Act 2020 and Rule 77(b)(iv) of the Personal Injury Commission Rules 2021. |
DETERMINATIONS MADE: | CERTIFICATE Issued under section 7.13(4) of the Motor Accident Injuries Act 2017 1. The proceedings are dismissed. |
REASONS
BACKGROUND
This is a merit review application in respect of a treatment dispute about psychological treatment and Motor Accidents Injuries Regulation 2017 Schedule 1, Part 2 (1) (the Regulation). The professional costs aspect of this dispute have been settled, but the claimant presses for payment of 50% of the disbursements claimed at $2262.75 plus GST. The claimant says that the disbursements were referable in equal amounts to a settled damages claim and the treatment dispute, which is a statutory matter under cl 8.10 of the regulation.
In respect of the alleged disbursements for the treatment dispute, the insurer submits the same disbursements were submitted with the permanent impairment dispute, which were submitted with the damages claim and paid when that claim settled on
23 February 2023.The claimant's argument in his submissions was that the insurer did not have an express discussion about whether the permanent impairment costs and disbursements were included in the damages claim. The insurer's attitude is that these costs and disbursements were contemplated and that the damages claim was resolved on an inclusive of costs basis.
The insurer has referred to earlier Personal Injury Commission (Commission) decisions[1], which confirm that merit reviewers do not have jurisdiction to deal with costs dispute arising from damages claims.
[1] Veli v AAI Limited t/as AAMI [2021] NSWPICMR 50, Foroosh v QBE (Insurance) Australia Limited [2022] NSWPICMR 57.
The claimant submitted merit reviewers have jurisdiction under the regulations in respect of permanent impairment disputes.
The claimant submitted that the Motor Accident Injuries Act 2017 (the MAI Act) actually sets up a different cost regime to the situation existing under the Motor Accidents Compensation Act 1999 (the MAC Act) and earlier motor accidents legislation, whereby settlement always contemplated inclusive of costs approach.
I directed that brief submissions be provided. This was done in accordance with the timetable set out in the teleconference report on 7 August 2023.
On the papers
Section 52(3) of the Personal Injury Commission Act 2020 (the PIC Act) provides:
“(3) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act and enabling legislation without holding any conference or formal hearing.”
Having regard to Procedural Directions PIC2 – Determination of matters ‘on the papers'; the documents that are before me, and with the parties’ submissions, I am satisfied that I will have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
SUBMISSIONS
Claimant’s submissions
Treatment dispute
The claimant claims for 50% of the disbursements set out in invoices attached to the application on the basis that those items relate equally to the treatment dispute and the psychological injury component of the claimant's permanent impairment dispute, 50% being in the sum of $1,131.38.
Medical Assessor Samuell determined both disputes. He provided Certificates dated 20 September 2022 in respect of permanent impairment and 6 March 2023 in respect of treatment and care following after he examined the claimant 11 August 2022.
The claimant relied upon the totality of the claimant's prior psychiatric treatment and medico-legal records for the purposes of both Applications and disputes.
Medical Assessor Samuell referred to all of the material submitted to him for the purposes of issuing his Certificates.
Permanent impairment dispute
The claimant submits that s 8.10 provides for recovery of costs in relation to claims for statutory benefits. Section 8.10 does not provide that there is no other entitlement to recover legal costs under the MAI Act.
Section 8.10 is merely intended to set out the legal costs recovery provisions as they relate to claims for statutory benefits.
Section 7.17 of the Act defines a medical dispute as including a dispute between a claimant and an insurer about a medical assessment matter.
The MAI Act provides in Schedule 2, at cl 2 - Medical assessment matters, that medical assessment matters for the purposes of Part 7 (Dispute Resolution) include the degree of permanent impairment of the injured person.
Division 7.5 of the MAI Act makes provision with respect to medical assessment, including medical dispute.
Schedule 1 of the Regulation provides for costs for legal services.
Part 1 at cl 2 of the Regulation provides for maximum costs for legal services in connection with a medical assessment under Division 7.5 of the Act at 16 monetary units (to a maximum of 60 monetary units per claim).
Schedule 2 at Part 2 then goes on to make provision for additional costs for claims for damages.
The Regulation makes a clear distinction between the costs in relation to medical disputes and the costs relating to claims for damages.
The claimant submits that the permanent impairment dispute legal costs are not, as the insurer submits, to be assessed with damages assessment costs.
Insurer’s submissions
Schedule 2 (1) (aa) of the MAI Act provides the Merit Reviewer’s jurisdiction to assess legal costs: (aa) whether for the purposes of section 8.10 (Recovery of costs and expenses in relation to claims for statutory benefits) the costs and expenses incurred by the claimant are reasonable and necessary.
The insurer submits that the Merit Reviewer does not have jurisdiction to assess and award legal costs for a Permanent Impairment dispute, as s 8.10 of the MAI Act only empowers a Merit Reviewer to consider legal costs for a statutory benefits claim.
Costs in relation to a permanent impairment (WPI) application are assessed at the damages assessment stage pursuant to s 7.37 of the MAI Act (much in the same way as the 1999 Scheme for recovery of MAS dispute legal costs operated).
As the damages claim has settled, the Permanent Impairment Application costs ‘dispute’ cannot be referred to the Commission.
The claimant submits the Regulations distinguishes between costs in relation to medical disputes and the costs relating to damages however has failed to identify any relevant authority which supports the allegation that costs for the permanent impairment dispute arises independently from an assessment of damages.
The Merit Reviewer does not have jurisdiction to assess and award legal costs for a permanent impairment dispute. There is no provision in Schedule 2 of the Act which prescribes it as a merit review matter, a dispute in relation to the costs of a permanent impairment dispute to establish an entitlement to damages for non-economic loss.
The claimant has failed to address the fact that s 8.10 of the MAI Act relates expressly to costs for statutory benefits claims.
Non-economic loss is a head of damage, and not a statutory benefit. Legal costs and disbursements connected with damages claims are dealt with under s 7.37. This empowers a Member to assess costs when damages claim are resolved in the Commission. Once the damages claim has settled, the ‘dispute’ as to costs for the permanent impairment assessment cannot be referred to the Commission.
The insurer maintains the application is without merit and ought to be dismissed.
OUTCOME
The cost disputes come before me in my capacity as a Merit Reviewer in accordance with Schedule 2, cl 1(aa) of the MAI Act. That provision empowers me to determine whether for the purposes of s 8.10 the costs and expenses incurred by the claimant in connection with a statutory benefits claim are reasonable and necessary.
Section 8.10(1) states:
“8.10 Recovery of costs and expenses in relation to claims for statutory benefits
(1) A claimant for statutory benefits is (subject to this section) entitled to recover from the insurer against whom the claim is made the reasonable and necessary legal costs, and other costs and expenses, incurred by the claimant in connection with the claim. Other costs and expenses include the cost of medical and other tests and reports.…”
Schedule 2, cl 1(aa) of the MAI Act, which is the clause a Merit Reviewer would rely on to resolve a cost dispute refers to s 8.10 which does not empower a Merit Reviewer to determine damages claim costs.
The fact that the Medical Assessor certificates used one assessment to resolve a permanent impairment dispute on damages with a treatment dispute cannot change the permanent impairment dispute to a statutory benefits costs dispute.
It was also apparent that despite the claimant’s submissions, a medical dispute which resolved the claimant’s entitlement to non-economic loss, and where the disbursements are offered as part of the damages settlement means the disbursements are to be resolved as part of the damages claim.
The disbursement costs were resolved totally when the damages claim was settled on an inclusive of costs basis.
Section 7.37 allows the Commission, when assessing damages, to also assess the claimant’s costs (including costs for legal services and fees for medico-legal services) in the matter. The disbursements schedule was provided to the insurer during the damages negotiations so that aspect of the legal costs was resolved when the damages dispute settled.
Section 7.37 does not apply to the costs in dispute in these proceedings. I am not assessing damages under Division 7.6 of the MAI Act.
I find that I do not have jurisdiction to determine the costs dispute connected with the whole person impairment assessment. Further the application is without substance because the matters in dispute have been resolved between the parties. The proceedings are dismissed in accordance with s 54(b) of the PIC Act and Rule 77(b)(iv) of the Commission Rules.
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