Allianz Australia Insurance Limited v Crazzi

[2006] NSWSC 1090

Reported Decision: 68 NSWLR 266

New South Wales

Supreme Court

CITATION:	Allianz Australia Insurance Limited v Crazzi and Others [2006] NSWSC 1090 This decision has been amended. Please see the end of the judgment for a list of the amendments.
HEARING DATE(S):	29 August 2006
JUDGMENT DATE :	18 October 2006
JUDGMENT OF:	Johnson J at 1
DECISION:	1. Summons dismissed; 2. Plaintiff to pay the costs of the First Defendant; 3. No order as to the costs of the Second and Third Defendants.
CATCHWORDS:	ADMINISTRATIVE LAW - claim for prerogative and declaratory relief - claims assessment system under Motor Accident Compensation Act 1999 - relationships between claims assessment and medical assessment provisions in Act - assessment conference before assessor - insurer admits liability - claim for interest deferred by assessor at suggestion of insurer - assessor purports to issue s.94 certificate of damages and statement of reasons without hearing and determining claim for interest - - whether denial of procedural fairness and jurisdictional error - claimant applies to assessor to consider claim for interest and issue s.94 certificate and reasons - whether assessor functus officio - power of Principal Claims Assessor to rectify "obvious error" under s.94(6) - meaning of "obvious error" - status of guidelines issued under Act - insurer seeks further medical assessment of claimant under s.62 - whether assessor may complete exercise of jurisdiction and issue s.94 certificate - if so, whether assessor bound to have regard to factual circumstances at time when certificate and reasons issue - assessor issues s.94 certificate and reasons - claimant accepts damages under s.95(2)(b) as contained in s.94 certificate and reasons - claim for prerogative and declaratory relief by insurer contending that s.94 certificate and reasons are null and void - no basis for relief established - relief to be refused, in any event, on discretionary grounds
LEGISLATION CITED:	Motor Accident Compensation Act 1999 Motor Accident Insurance Act 1994 (Qld) Interpretation Act 1987 Administrative Decisions Tribunal Act 1997 (NSW) Administrative Appeals Tribunal Act 1975 (Cth) Probation and Parole Act 1983 Commercial Arbitration Act 1984 Workplace Injury Management and Workers Compensation Act 1998 Migration Act 1958 (Cth) Supreme Court Act 1970 Aboriginal Land Rights (Northern Territory) Act 1976 (Cth)
CASES CITED:	R v Australian Broadcasting Tribunal; Ex part Hardiman (1980) 144 CLR 13 Longhurst v Hunt [2004] NSWCA 91 Zurich Australian Insurance Limited v Motor Accidents Authority of NSW [2006] NSWSC 845 Richards v Richards [2006] NSWSC 140 Lee v Yang [2006] NSWCA 214 NRMA Insurance Limited v Motor Accidents Authority of NSW (2004) 61 NSWLR 264 Collector of Customs v Agfa-Gevaert Pty Limited (1995-1996) 186 CLR 389 State of NSW v Macquarie Bank Ltd (1992) 30 NSWLR 307 Coleman v Gray (1994) 55 FCR 412 Hodgson v Crane (2002) 55 NSWLR 199 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 Autodesk Inc v Dyason [No. 2] (1992-1993) 176 CLR 300 De L v Director-General, NSW Department of Community Services [No. 2] [1997] 190 CLR 207 DJL v Central Authority (2000) 201 CLR 226 Lunn v The Cardiff Coal Company (No. 2) [2003] NSWSC 25 Standard Commodities Pty Limited v Society Socinter department Centragel [2005] NSWSC 493 NSW Insurance Ministerial Corporation v Elkins (1998) 45 NSWLR 8 L Shaddock & Associates Pty Limited v Parramatta City Council [No. 2] (1983) 151 CLR 590 Gould v Vaggelas (1983-1985) 157 CLR 271 Storey & Keers Pty Limited v Johnstone (1987) 9 NSWLR 446 Elyard Corporation Pty Limited v DDB Needham Sydney Pty Limited (1995) 61 FCR 385 Sakr v Mercantile Mutual Insurance [2000] NSWCA 266 Roads and Traffic Authority v Palmer (No. 2) [2005] NSWCA 140 J Aron Corporation v Newmont Yandal Operations [2006] NSWSC 849 Abigroup Limited v Avignano (1992) 39 FCR 74 Bonnici v Ku-Ring-Gai Municipal Council [2001] NSWSC 1124 PM Sulcs & Associates Pty Limited v Daihatsu Australia Pty Limited [2001] NSWSC 798 Firearm Distributors Pty Limited v Carson (2001) 2 QdR 26 Plaintiff S157/2002 v Commonwealth of Australia (2003) 211 CLR 476 Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 Hazim v Secretary, Department of Family and Community Services (2002) 68 ALD 39 Johnson v Veterans’ Review Board (2005) 41 AAR 120 Riley v Parole Board of NSW (1985) 3 NSWLR 606 Larkin v Parole Board (1987) 10 NSWLR 57 Promenade Investments Pty Limited v State of New South Wales (1992) 26 NSWLR 203 Merza v Registrar of the Workers Compensation Commission [2006] NSWSC 939 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Chandler v Alberta Association of Architects (1989) 2 SCR 848 Jadwan Pty Limited v Secretary, Department of Health and Aged Care (2003) 145 FCR 1 Von Lieven v Stewart (1990) 21 NSWLR 52 Craig v South Australia (1994-1995) 184 CLR 163 Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 Brodyn Pty Limited v Davenport (2004) 61 NSWLR 421 French v Sydney Turf Club Ltd (No. 2) [2003] NSWADTAP 54 Ainsworth v Criminal Justice Commission (1991-1992) 175 CLR 564 Houssein v Under Secretary Department of Industrial Relations (1982) 148 CLR 88 Hornsby Shire Council v Porter (1990) 19 NSWLR 716 Minister for Aboriginal Affairs v Peko-Wallsend Limited (1985-1986) 162 CLR 24 Ambulance Service of NSW v Daniel [2004] NSWCA 406 R v Ross-Jones; Ex parte Green (1984) 156 CLR 185 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 The King v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Limited (1949) 78 CLR 389 Zuanic v Gyro-Tech (Australia) Pty Ltd (In Liquidation) [2006] NSWSC 738 Peko-Wallsend Limited v Minister for Aboriginal Affairs (1985) 5 FCR 532 Tepko Pty Limited v Water Board (2001) 206 CLR 1
PARTIES:	Allianz Australia Insurance Limited (Plaintiff) Franco Crazzi (First Defendant) Motor Accidents Authority of New South Wales (Second Defendant) Mark Joseph Flynn (Third Defendant)
FILE NUMBER(S):	SC 11929/2006
COUNSEL:	Mr A Robertson SC; Mr W Fitzsimmons (Plaintiff) Mr GR Petty SC; Mr DJ Hooke (First Defendant) Mr MA Robinson (Second Defendant) Submitting appearance (Third Defendant)
SOLICITORS:	Ferguson Lawyers (Plaintiff) Beilby Poulden Costello (First Defendant) Robert Dawson - MAA (Second and Third Defendants)
LOWER COURT DATE OF DECISION:	---
LOWER COURT MEDIUM NEUTRAL CITATION:	---

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

Johnson J

18 October 2006

11929/06 Allianz Australia Insurance Limited v Franco Crazzi and Others

JUDGMENT

1 JOHNSON J: By Summons filed on 28 April 2006, Allianz Australia Insurance Limited (“Allianz”) seeks prerogative and declaratory relief with respect to a certificate dated 23 March 2006 issued in favour of Franco Crazzi, the First Defendant, by the Third Defendant, Mark Joseph Flynn, in his capacity as an assessor for the Second Defendant, the Motor Accidents Authority of New South Wales (“MAA”) under s.94 Motor Accident Compensation Act 1999 (“MAC Act”).

2 Allianz submits that the certificate is invalid and void, and ought be set aside on and from the date when it was issued. Allianz contends that an assessment of damages made in favour of Mr Crazzi on 23 March 2006 pursuant to s.94 MAC Act should likewise be declared invalid and void, and set aside on and from the date when it was made.

An Overview of the Case

3 On 3 July 2001, Mr Crazzi was injured in a motor vehicle accident. He brought a claim for compensation under the New South Wales statutory scheme. The insurer, Allianz, admitted liability. An assessment hearing was scheduled before a statutory assessor. Allianz applied for the hearing to be adjourned for the purpose of further medical assessment of Mr Crazzi. The assessor declined to adjourn the matter and the hearing proceeded. At the suggestion of counsel for Allianz during the hearing, the assessor deferred Mr Crazzi’s claim for interest until the other heads of damages had been assessed. However, the assessor overlooked this aspect and proceeded, in due course, to issue a statutory certificate awarding damages and costs to Mr Crazzi. Under the statutory scheme, Mr Crazzi had 21 days to accept the assessed figure, otherwise he would have to take his chances by way of court proceedings with a costs penalty if he did not do better than the sum contained in the certificate. The assessor was reminded that the claim for interest was outstanding. The 21-day period passed whilst the parties debated in correspondence what should be done.

4 The assessor accepted that he had fallen into jurisdictional error and that he could issue a certificate after determining the interest claim. Allianz said he could not do this but, even if he could, the step should not be taken until after any further medical assessment was complete. However, the assessor issued a certificate after considering the interest claim. Mr Crazzi accepted the assessment in this certificate within the 21-day period. Allianz now challenges the issue of the second certificate.

The Present Hearing

5 At the hearing of the Summons, Mr A Robertson SC and Mr WM Fitzsimmons appeared for Allianz. Mr GR Petty SC and Mr DJ Hooke appeared for Mr Crazzi. Despite the MAA filing a submitting appearance, Mr MA Robinson of counsel sought leave to appear for the MAA pursuant to Rule 6.11(2) Uniform Civil Procedure Rules to make written and oral submissions on the powers and procedures of the MAA in accordance with the principles in R v Australian Broadcasting Tribunal; Ex part Hardiman (1980) 144 CLR 13 at 35-36. Given the nature of the issues raised in the proceedings, I granted Mr Robinson leave to make limited submissions on behalf of the MAA. It was common ground that a number of the issues raised in the present proceedings are novel and have significance with respect to the functions of assessors under the MAC Act. I note that a submitting appearance was filed on behalf of Assessor Flynn.

6 The issues falling for determination in these proceedings include the following:

(a) whether it is open to an assessor under the MAC Act, who has purported to issue a s.94 certificate and statement of reasons in circumstances involving jurisdictional error, to remedy the defect by completing the exercise of jurisdiction and issuing a certificate and statement of reasons;

(b) the proper construction of s.94(6) MAC Act and whether the power in the Principal Claims Assessor to correct an “obvious error” under s.94(6) is confined to errors apparent on the face of the s.94 certificate and statement of reasons;

(c) whether the presence of s.94(6) in the MAC Act operates, by negative implication, to exclude the self-help remedy which might otherwise have been available to an assessor who purports to issue a certificate and statement of reasons in circumstances involving jurisdictional error;

(d) whether, in the event that an assessor is able to remedy the matter, after jurisdictional error, by issuing a s.94 certificate and statement of reasons, he or she is bound to have regard to the facts and circumstances as they stand at the time when the remedial certificate and statement of reasons issues;

(e) the interrelationship between the medical assessment provisions and claims assessment provisions within the MAC Act and, in particular, whether a claims assessor ought defer an assessment conference or hearing, and the issue of a s.94 certificate and statement of reasons, whilst application is on foot (or approval has been given) for further medical assessment of the claimant.

The Compensation Scheme under the MAC Act

7 Before turning to the facts of this case, it is appropriate to place the matter in its statutory context.

Some General Features of the Statutory Scheme

8 The MAC Act took effect in respect of motor accidents which occurred after 4 October 1999. There is an elaborate objects clause in s.5:

“ Objects of Act

(1) The objects of this Act are as follows:


(a) to encourage early and appropriate treatment and rehabilitation to achieve optimum recovery from injuries sustained in motor accidents, and to provide appropriately for the future needs of those with ongoing disabilities,

(b) to provide compensation for compensable injuries sustained in motor accidents, and to encourage the early resolution of compensation claims,

(c) to promote competition in the setting of premiums for third-party policies, and to provide the Authority with a prudential role to ensure against market failure,

(d) to keep premiums affordable, recognising that third-party bodily insurance is compulsory for all owners of motor vehicles registered in New South Wales,

(e) to keep premiums affordable, in particular, by limiting the amount of compensation payable for non-economic loss in cases of relatively minor injuries, while preserving principles of full compensation for those with severe injuries involving ongoing impairment and disabilities,

(f) to ensure that insurers charge premiums that fully fund their anticipated liability,

(g) to deter fraud in connection with compulsory third-party insurance.

(2) It must be acknowledged in the application and administration of this Act:


(a) that participants in the scheme under this Act have shared and integrated roles with the overall aim of benefiting all members of the motoring public by keeping the overall costs of the scheme within reasonable bounds so as to keep premiums affordable, and

(b) that the law (both the enacted law and the common law) relating to the assessment of damages in claims made under this Act should be interpreted and applied in a way that acknowledges the clear legislative intention to restrict the level of non-economic loss compensation in cases of minor injuries, and
(c) that:

(i) the premium pool from which each insurer pays claims consists at any given time of a finite amount of money, and

(ii) insurers are obliged under this Act to charge premiums that will fully fund their anticipated liability, and

(iii) the preparation of fully funded premiums requires a large measure of stability and predictability regarding the likely future number and cost of claims arising under policies sold once the premium is in place, and

(iv) the stability and predictability referred to in subparagraph (iii) require consistent and stable application of the law, and

(d) that insurers, as receivers of public money that is compulsorily levied, should account for their profit margins, and their records should be available to the Authority to ensure that accountability.”

It has been observed that one of the purposes of the MAC Act is to contain costs in the motor accident field in relation to premiums payable under the relevant statutory scheme: Longhurst v Hunt [2004] NSWCA 91 at paragraphs 8, 68-72.

9 Section 6 MAC Act makes express provision for a purposive construction to be given to provisions of the Act:

“ Interpretation and application of Act by reference to objects

(1) In the interpretation of a provision of this Act or the regulations, a construction that would promote the objects of this Act or the provision is to be preferred to a construction that would not promote those objects.

(2) In the exercise of a discretion conferred by a provision of this Act or the regulations, the person exercising the discretion must do so in the way that would best promote the objects of this Act or of the provision concerned.”

A purposive construction was given to s.133(3) MAC Act (which restricts damages for non-economic loss) by reference to the statutory objects in ss.5(1)(e), 5(2)(a), 5(2)(b) and 6 MAC Act: Longhurst v Hunt at paragraph 69.

10 In Zurich Australian Insurance Limited v Motor Accidents Authority of NSW [2006] NSWSC 845, Hoeben J provided a helpful summary of the legislative scheme under the MAC Act at paragraphs 22-26:

“22 An important feature of the Act is that it restricted access to damages for non-economic loss (ss131-134). Non-economic loss would not be awarded unless the degree of permanent impairment of the injured person was greater than 10% whole person impairment (s131). That assessment was to be made in accordance with the medical guidelines issues by the Authority. Where injuries were assessed at greater than 10% whole of person permanent impairment, common law principles in relation to the assessment of damages for non-economic loss would apply although s134 sets a maximum indexed amount.

23 The Act introduced a new system of medical assessments (ss57-65) by the Medical Assessment Service (MAS). Where there was a dispute as to the level of permanent impairment, that dispute was referred to and determined by a medical assessor in accordance with the provisions of the Act. Those medical assessors must issue a certificate in relation to their finding on the matter referred. A Court’s capacity to review, reject or substitute such a certificate was limited (s61(4)). The medical assessor’s decision as to permanent impairment was binding on the parties.

24 The Act created a Claims Assessment and Resolution Service (CARS) (ss90-95). CARS dealt with liability and damages disputes. Like the approach to damages for non-economic loss, these provisions were a significant departure from previous legislation relating to motor accidents in that this process of assessment was administrative and not judicial.

25 Assessors are appointed by the Authority but are not subject to the control or direction of the Authority in relation to their decisions (s105). An assessor’s decision on liability is not binding but an assessment on quantum is binding on the insurer if the insurer accepts that liability and also on the claimant if the claimant accepts the assessment within twenty one days of the issue of the Certificate of Determination. ( Lee v Yang [2006] NSWCA 214.) The assessors may hold conferences with all relevant parties in attendance and with the relevant experts in attendance or hold separate assessment conferences in private with any of them or, where an assessor is satisfied that sufficient information has been supplied, without holding any assessment conferences or other formal hearing at all (s104).

26 The Act recognised that there would be claims which would be exempted from CARS assessment (s92). Claims which are exempted from CARS assessment are issued with a certificate to enable court proceedings to be commenced thus bypassing the CARS procedure. A further novel feature of the Act was that access to the courts was significantly restricted by comparison with previous legislation in relation to motor accidents.”

The Claims Assessment System

11 Claims Assessors are officers of the MAA designated as such within the meaning of s.99 MAC Act. They are officers within the Claims Assessment and Resolution Service (“CARS”), which is itself a “unit” of the MAA established pursuant to s.98 MAC Act.

12 Claims assessors have limited civil protection under s.103(1) and are subject to the general control and direction of the Principal Claims Assessor in the exercise of their functions (s.105(3)) but not in relation to the actual making of particular assessments (s.105(2)).

13 Claims assessors have one primary duty - to assess claims referred to the MAA by the claimant or the insurer (s.90) which are then, in turn, referred to the claims assessor by the Principal Claims Assessor pursuant to s.93 MAC Act. The duty is expressed in s.94(1) of the Act. Sections 94 and 95 are of central importance to this case, and are set out hereunder:

“94 Assessment of claims

(1) The claims assessor is, in respect of a claim referred to the assessor for assessment, to make an assessment of:

(a) the issue of liability for the claim (unless the insurer has accepted liability), and

(b) the amount of damages for that liability.
(2) Such an assessment is to be made having regard to such information as is conveniently available to the claims assessor, even if one or more of the parties to the assessment does not co-operate or ceases to co-operate.

(3) The assessment is to specify an amount of damages.

(4) The claims assessor must, as soon as practicable, after an assessment issue the insurer and claimant with a certificate as to the assessment.

(5) The claims assessor is to attach a brief statement to the certificate, setting out the assessor’s reasons for the assessment.

(6) If the Principal Claims Assessor is satisfied that a certificate as to an assessment or a statement attached to the certificate contains an obvious error, the Principal Claims Assessor may issue, or approve of the claims assessor issuing, a replacement certificate or statement to correct the error.
95 Status of assessments


(1) An assessment under this Part of the issue of liability for a claim is not binding on any party to the assessment.

(2) An assessment under this Part of the amount of damages for liability under a claim is binding on the insurer, and the insurer must pay to the claimant the amount of damages specified in the certificate as to the assessment if:

(a) the insurer accepts that liability under the claim, and

(b) the claimant accepts that amount of damages in settlement of the claim within 21 days after the certificate of assessment is issued.
Note. If the amount of damages is not accepted by the claimant within that period, section 151 makes provision with respect to liability for legal costs incurred after the certificate of assessment was issued.
(3) It is a condition of an insurer’s licence under Part 7.1 that the insurer complies with this section.”

14 In Richards v Richards [2006] NSWSC 140, Malpass AsJ observed, at paragraph 8, that the effect of s.95 MAC Act was to create a “unique concept” whereby, if the requirements of s.95(2)(a) and (b) are satisfied, an assessment of the amount of damages for liability under a claim creates a “deemed offer” which may be accepted by the claimant.

15 In Lee v Yang [2006] NSWCA 214, Giles JA (Hodgson and Ipp JJA agreeing) at paragraphs 26-28, referred to the CARS provisions in Part 4.4 MAC Act, in the context of the stated objects of the Act, including the encouragement of early resolution of claims to compensation for injuries sustained in motor accidents: s.5(1)(b). The process of assessment, including ss.94 and 95, was to be viewed against a background where a costs penalty existed under s.151 MAC Act if the claimant did not accept the amount of damages assessed in settlement of the claim within 21 days after the certificate is issued.

16 The power to make regulations concerning, inter alia, the making of assessments is contained in s.97 MAC Act. While there are no such regulations at present, there are regulations regarding costs assessments: Part 3 of Motor Accidents Compensation Regulation 2005.

17 By s.106(1), claims assessments under Part 4.4 MAC Act (ss.88-106) are “subject to relevant provisions of MAA Claims Assessment Guidelines relating to those assessments”. Under s.69(1) MAC Act, the MAA may issue guidelines “with respect to procedures for the assessment of claims under Part 4.4 and associated matters”. Guidelines establishing procedures for assessing claims were promulgated in June 2002 and are styled “Claims Assessment Guidelines”. These Guidelines may be characterised as delegated legislation, in the same way as the MAA Medical Guidelines under s.44 MAC Act: NRMA Insurance Limited v Motor Accidents Authority of NSW (2004) 61 NSWLR 264 at 267 [10]-[14], 269-270 [26]-[28]. As delegated legislation, the Claims Assessment Guidelines cannot affect the proper construction of the MAC Act or limit rights conferred by the Act; they exist to indicate how relevant assessments are generally carried out: NRMA Insurance Limited at 270 [28]; Pearce and Geddes, Statutory Interpretation in Australia, 6th edn, 2006, at [3.41]; and are subordinate legislation in the nature of regulations: Zurich Australian Insurance Ltd v Motor Accidents Authority of NSW at paragraph 28. The general principles relating to the interpretation of Acts of Parliament are equally applicable to the interpretation of delegated legislation: Collector of Customs v Agfa-Gevaert Pty Limited (1995-1996) 186 CLR 389 at 398. The normal purpose of subordinate legislation is to give effect to the provisions of the parent statute: State of NSW v Macquarie Bank Ltd (1992) 30 NSWLR 307 at 320. Subordinate legislation is typically designed to carry into effect the expressed intention of the legislature in ways incidental to the execution of the statue itself: State of NSW v Macquarie Bank at 321. It is appropriate to look beyond the MAC Act to the Guidelines to ascertain the overall statutory scheme: Coleman v Gray (1994) 55 FCR 412 at 423.

18 A further understanding of the powers and functions of a claims assessor may be derived from Chapters 10 to 17 of the Claims Assessment Guidelines (as they stood prior to 1 May 2006). Of particular relevance for present purposes are Chapters 12, 13, 16 and 17 which provide as follows:

“Chapter 12. PRELIMINARY ASSESSMENT

12.1 The Preliminary Assessment arranged in accordance with clause 9.1 above is to be conducted within 15 days of the date of the letter advising the parties of the allocation (or re-allocation in the case of a conflict) of a matter to an assessor.

12.2 At the preliminary assessment, the assessor is to review the file to:


12.2.1 Determine whether the matter is suitable for assessment; and

12.2.2 Determine whether other documentation or information is required as set out in clause 11.9 above; and

12.2.3 Determine the way in which an assessment is to proceed as set out in clause 10.6 above; and

12.2.4 Conduct the preliminary conference.

12.3 The Preliminary Conference may be conducted by way of:


12.3.1 A three-way telephone conversation (teleconference) between the assessor, the claimant (or the claimant's legal representative or agent) and the insurer (or the insurer's legal representative or agent); or

12.3.2 A face to face conference between the assessor, the claimant (or the claimant's legal representative or agent) and the insurer (or the insurer's legal representative or agent).


12.4 If a party is represented, then the legal representative or agent with day to day conduct of the claim must, as far as is practicable be available for the preliminary conference. In the case of an insurer, the claims officer with day to day conduct of the claim must, as far as is practicable be available for the preliminary conference.

12.5 If any party is, without reasonable excuse, unavailable at the time of the preliminary conference then the assessor may conduct the preliminary conference in the absence of the party.

12.6 The assessor must within 10 days of the preliminary conference advise the parties in writing:


12.6.1 Of the way in which the assessment is to proceed under clause 10.6; and

12.6.2 What further documentation or information is required under clause 11.1; and

12.6.3 Of any other decisions made or directions given at the preliminary conference.


12.7 During the course of a preliminary assessment the assessor shall not enquire about the amount of any offers made by either party. An assessor shall not be disqualified from assessing a matter because the assessor becomes aware in any manner of the amount of any offer.

Chapter 13. ASSESSMENT CONFERENCE

13.1 Where the assessor notifies the parties of an intention to conduct an assessment conference the parties must advise the assessor and the other party within 10 days of the notification:


13.1.1. Whether or not they will be represented by an agent or legal practitioner and as far as is practicable the name of the legal practitioner or agent;

13.1.2 If an agent is to represent the party, the extent of the agent's authority;

13.1.3 Whether or not an interpreter is required and if so the language; and

13.1.4 The names of any witnesses who the party wishes to call to give evidence.


13.2 The assessor may require the presentation of the respective cases of the parties to be limited to the periods of time that the assessor determines are reasonably necessary for the fair and adequate presentation of the cases.

13.3 The assessor may require the parties to the assessment submit to the assessor and to any other party to the assessment, prior to the assessment conference, a signed statement or statutory declaration detailing the evidence to be given by any witness to be called.

13.4 The assessor shall determine the manner in which evidence is presented at an assessment conference, subject to:


13.4.1 Each party is to be given an opportunity to address the assessor on any issue in dispute and to put to the assessor any questions that the party seeks that the assessor ask or any areas that the party wants the assessor to explore;

13.4.2 The examination of parties and witnesses is by the assessor and questions to other parties or witness may only be put as directed by the assessor;

13.4.3 The assessor may, on the application of a party allow the questioning of a witness by that party's legal representative or agent;

13.4.4 The assessor may question any witness to such extent as the assessor thinks proper in order to elicit information relevant to matter; and

13.4.5 The assessor cannot compel any witness to answer any question put in the conference but may have regard to the failure of a witness to answer a question in the determination of the assessment.


13.5 The assessor may adjourn a conference to any time and place on reasonable grounds, including but not limited to allowing the parties to negotiate a settlement.

13.6 The assessor may conclude the conference to give effect to any agreed settlement reached by the parties.

13.7 During the course of an assessment the assessor shall not enquire about the amount of any offers made by either party. An assessor shall not be disqualified from assessing a matter because the assessor becomes aware in any manner of the amount of any offer.

13.8 A party shall not be entitled to call before an assessor oral evidence of a medical practitioner or other expert without the leave of the assessor.

13.9 An assessor (other than a Senior Assessor) may not take into consideration in respect of the case of each party, reports (excluding reports from treating practitioners) from;


13.9.1 More than one medical expert in any specialty (unless there is a substantial issue as to a matter referred to in section 58(1)(c) or (d) of the Act – in which case 2 medical expert reports in any specialty relevant to the injury concerned may be allowed) and

13.9.2 2 experts in the same field of any other kind.

13.10 An assessor, including a Senior Assessor, may take into account a greater number of experts reports in the matter but should consider:


13.10.1 The objects of the Act; and

13.10.2 Clause 14(1) and (2) of the Motor Accidents Compensation Regulation (No 2) 1999; and

13.10.3 Fairness to both parties.

…

Chapter 16. CERTIFICATE AND STATEMENT OF REASONS

16.1 Upon completion of the assessment the assessor is to issue a certificate under section 92, 94 or 96.

16.2 A copy of the certificate and any statement of reasons is to be provided to the PCA and each party within 10 days of the conclusion of any assessment conference or in the absence of any assessment conference, within 10 days of the provision by the parties of all information and documentation sought by the assessor at the preliminary conference.

16.3 A certificate under section 92(1)(b), 94 or 96 is to have attached to it a statement of the reasons for the assessment. The statement of reasons is to set out:


16.3.1 The findings on material questions of fact; and

16.3.2 The assessor's understanding of the applicable law; and

16.3.3 A list of any documents tendered or submitted to the assessor at or before the assessment conference but not listed in the application or reply forms; and
16.3.4 A brief description of any oral evidence given; and

16.3.4 [sic] The reasoning processes that lead the Assessor to the conclusions made

16.3.5 In the case of an assessment certificate pursuant to section 94, the assessor must specify an amount of damages and the manner of determining an amount of damages.


16.4 The assessor may at any time issue a certificate in accordance with an agreed settlement, provided the terms of the agreed settlement are reduced to writing, signed by or on behalf of the parties and lodged with the assessor, and the assessor is satisfied that the terms of the agreed settlement are matters upon which the assessor has power to make an assessment. In these circumstances the assessor need not provide a statement of reasons.

Chapter 17. CORRECTIONS

17.1 In accordance with section 94(6), if the PCA is satisfied that there is an obvious error in a certificate as to an assessment or in the statement attached to the certificate, the PCA or the assessor may issue a replacement certificate or statement.

17.2 If the certificate or statement of reasons is altered, the altered certificate or statement is taken to be the decision of the assessor or the reasons for the decision.

17.3 Examples of obvious errors in the certificate or statement of reasons are where:


17.3.1 There is an obvious clerical or typographical error in the certificate or statement of reasons, or

17.3.2 There is an error arising from an accidental slip or omission, or

17.3.3 There is a defect of form, or

17.3.4 There is an inconsistency between the decision and the statement of reasons.

17.4 If the certificate or statement of reasons is altered, the PCA must provide the parties with a copy of the altered certificate or statement of reasons within 5 days of the PCA making the alteration.”

19 Under s.93 MAC Act, the Principal Claims Assessor is responsible for making arrangements as to the claims assessor who is to assess any particular claim, or class of claims, that are not exempt from assessment.

20 Under the Guidelines, a claims assessor notifies the parties of the way in which the assessment is to proceed. An assessment conference or hearing is usually held where both parties appear to give “evidence” (as referred to in Guideline 13.4). Witnesses for the parties may appear and give evidence. However, only the claims assessor may question witnesses and they cannot be compelled to answer: Guideline 13.4. A party’s legal representative or agent may question a witness, but only with leave of the claims assessor. In addition, there are limits to the number of medical expert reports that an assessor may take into account: Guideline 13.9.

The Facts

21 As will be seen, there is little or no dispute as to relevant facts. Rather, controversy exists with respect to the legal consequences of certain events.

22 The evidentiary foundation for the following narrative flows almost entirely from the tender bundle (“TB”) which accompanied the affidavit of Stephen John Ferguson sworn 15 May 2006, read in Allianz’s case. Mr Petty SC read, in Mr Crazzi’s case, affidavits of Scott Hall-Johnston sworn 31 May 2006 and 24 August 2006. No deponent was required for cross-examination.

A Motor Vehicle Accident on 3 July 2001

23 As at 3 July 2001, Allianz was the third-party insurer for the purposes of the Motor Accident Insurance Act 1994 (Qld) of vehicle registered number 297-CSW (Qld). On 3 July 2001, Mr Crazzi was injured in New South Wales as a result of the negligent driving of that vehicle.

24 On 19 October 2001, Mr Crazzi made a claim for damages pursuant to the MAC Act. On 25 August 2004, Mr Crazzi made application for medical assessment of his whole-person impairment pursuant to Part 3.4 MAC Act. In due course, he was assessed by Dr Peter Jackson, a musculo-skeletal physician and medical assessor under the MAC Act. A Certificate of Determination issued on 28 January 2005 certifying under s.61(9) MAC Act that injuries to Mr Crazzi’s right wrist, right shoulder and back caused by the motor accident of 3 July 2001 gave rise to a whole-person impairment which, in total, was greater than 10%.

Procedural Steps Leading to Assessment Hearing

25 The MAA referred the matter to Assessor Flynn for assessment pursuant to Part 4.4 MAC Act. On 19 July 2005, a first preliminary conference took place before Assessor Flynn. Allianz admitted liability. Assessor Flynn gave directions under s.100 MAC Act in preparation for hearing of the assessment and directed that a further preliminary conference take place on 1 November 2005.

26 On 8 September 2005, the solicitors for Allianz wrote to Mr Crazzi’s solicitors informing them that arrangements had been made for examination of Mr Crazzi by Dr D Lovell, psychiatrist, and Dr T Blue, orthopaedic surgeon.

27 Under cover of letter dated 14 October 2005, Mr Crazzi’s solicitors served upon the solicitors for Allianz an outline of submissions with respect to assessment of damages.

28 In a report dated 20 October 2005, Dr Blue reported on his examination of Mr Crazzi on 17 October 2005. Dr Blue concluded that Mr Crazzi suffered from a zero whole-person impairment of his cervical spine and lumbar spine with a similar conclusion with respect to his right wrist. In relation to Mr Crazzi’s right shoulder, Dr Blue assessed him as suffering from a 16% impairment of his right upper limb which equated to a 10% whole-person impairment (TB72).

29 The further preliminary conference took place before Assessor Flynn on 1 November 2005. Further directions were given in preparation for hearing and an assessment conference was fixed to take place at 10.00 am on 7 December 2005. Assessor Flynn’s report of 7 November 2005 informed the parties of his directions, including the following statement (TB74-75):

“The parties should be aware that I do not intend to issue a draft set of reasons and then seek submissions on costs. I intend to issue a final certificate and reasons. If no submissions on costs and disbursements are received my assessment of the claimant’s costs will be limited to the professional costs as provided for in the costs regulations. If the insurer seeks to rely on any offers made, the insurer should provide details of those offers in a sealed envelope marked ‘Offers - Relevant to Costs’ along with the material in direction 2 above.”

30 By report dated 8 November 2005, Dr Lovell certified that Mr Crazzi had an eight percent whole-person psychiatric impairment attributable to the accident of 3 July 2001 (TB87).

31 On 17 November 2005, the solicitors for Allianz lodged an application with the MAA for a further medical assessment of Mr Crazzi under s.62 MAC Act. On the same day, Assessor Flynn was informed of this application and a request was made to him to adjourn the general assessment scheduled for 7 December 2005 until the outcome of the application for a further medical assessment was known. The application for further medical assessment was based upon Dr Blue’s report. Dr Blue had assigned a 10% whole-person impairment to Mr Crazzi.

32 The purpose of Allianz seeking a further medical assessment of Mr Crazzi under s.62 MAC Act may be found by reference to provisions in the Act imposing impairment thresholds for an award of damages for non-economic loss. As noted earlier in this judgment, s.131 MAC Act provides that no damages may be awarded for non-economic loss unless the degree of permanent impairment of the injured person as a result of injury caused by the motor accident is greater than 10%.

33 Assessor Flynn conducted a further preliminary conference on 1 December 2005. After hearing submissions from the parties, Assessor Flynn refused the insurer’s adjournment application and provided written reasons to the parties for this decision which included the following (TB111-112):

“I refer to the further preliminary conference conducted in respect of this matter on 1 December 2005.
I note the insurer, in light of the lodgement of a MAS 4A sought to adjourn the assessment hearing scheduled in this matter for 7 December 2005.
I note the advice of the insurer’s solicitor that there is no additional primary material sought to be relied on in support of the MAS Application except for a medico-legal opinion of Dr Tony Blue.
I note the Application is strenuously opposed by the claimant.
I note it is not the domain of a CARS Assessor to enquire as to the merits of the MAS Application but forever conscious of the fact that this matter has been fixed for hearing for some time and I am obliged under the Guidelines to provide a decision on or before 21 December 2005 I do not believe it is appropriate in the circumstances to vacate the assessment hearing.
In my view, there is sufficient material available to me to assess this matter, nor is there sufficient medical information before me that would suggest that there would be any material or more importantly significant change in the medical assessments to warrant an adjournment of the hearing.
In my view, a claimant who has been the subject of a MAS Assessment can and should be entitled to a hearing of his case within a reasonable period of time and in this regard I note this matter was fixed for assessment hearing on 7 December 2005 when the matter was listed for directions on 7 November 2005 and more importantly the insurer consented to the matter being fixed at this time.
In this regard, I note the insurer has been provided with a report from its own psychiatrist confirming the claimant is suffering an 8% whole person impairment due to injuries arising out of the subject accident.”

Assessment Hearing on 7 December 2005

34 At the assessment hearing before Assessor Flynn on 7 December 2005, Mr Hooke of counsel appeared for Mr Crazzi and Mr Fitzsimmons of counsel appeared for Allianz. At the commencement of the hearing, Mr Fitzsimmons renewed the adjournment application, which was refused by the Assessor. The hearing proceeded and, at the conclusion of evidence, Assessor Flynn invited the parties to speak to their written submissions. I find that, during the course of submissions, Mr Hooke said words to the following effect:

“I also wish to make submissions in relation to a claim for interest.”

Mr Fitzsimmons replied to the following effect:

“That matter should be dealt with when the other matters have been determined. We will then be in a better position to deal with it.”

Assessor Flynn then said words to the following effect:

“What do you say about that Mr Hooke?”

Having obtained instructions to consent to this course, Mr Hooke said words to the following effect:

“If that is the way the insurer wants to deal with it and you are happy to deal with it that way Mr Assessor, then we are content with that. It can probably be addressed by written submissions when draft reasons are available.”


According to unchallenged evidence in the form of an affidavit from Mr Crazzi’s solicitor, Assessor Flynn nodded his head at this point and said words to the effect of “OK” or “I agree” .

The Assessor’s Purported Certificate and Reasons of 30 December 2005

35 On 23 December 2005, an unsigned form of certificate and statement of reasons were supplied to the parties, but it is now common ground that these did not constitute a certificate and statement of reasons for the purposes of s.94 MAC Act and ought be disregarded.

36 On 30 December 2005, Assessor Flynn wrote to the parties in the following terms:

“A copy of the final Certificate and Statement of Reasons is attached, the original of which has been forwarded to CARS this instant.”

37 Accompanying that letter was a purported certificate under s.94 MAC Act assessing the amount of damages in respect of Mr Crazzi’s claim in the sum of $786,006.40 and assessing his costs in the sum of $54,196.73 inclusive of GST. The certificate dated 30 December 2005 was accompanied by a statement of reasons for decision purportedly issued under s.94(5) MAC Act, comprising 35 pages. Both were signed by Assessor Flynn. It was also common ground before me that the certificate and statement of reasons dated 30 December 2005 were intended by Assessor Flynn to be, at the time of issue, a certificate and statement issued for the purposes of s.94 MAC Act.

The Claim for Interest is Overlooked

38 Both the certificate and statement of reasons of 30 December 2005 were silent on the question of interest. There was no statement that an application for interest remained outstanding. There was no mention of the agreement between counsel for Mr Crazzi and Allianz at the assessment hearing on 7 December 2005, acceded to by Assessor Flynn, that the question of interest could be considered separately and after the determination of other issues involved in the assessment of damages.

39 Mr Crazzi’s “claim” was a claim for damages (see definition of “claim” in s.3 MAC Act). As liability had been accepted by Allianz, Assessor Flynn was required to make an assessment of the amount of damages for that liability: s.94(1)(b). The assessment of damages fell to be determined by application of Chapter 5 (ss.122-146) MAC Act. A claim for interest was to be determined in accordance with the limited statutory entitlement to interest in s.137 MAC Act. The proper construction of s.94, and the provisions in Part 5 MAC Act, supports a conclusion that any award of interest under s.137 ought be included in the s.94 certificate and statement of reasons as part of the assessment of damages. However, the parties had invited the Assessor in this case to deal separately and later with the interest application and on 7 December 2005, the Assessor acceded to such an approach.

40 Implicit in this approach was a common understanding and expectation that a s.94 certificate and statement of reasons would not issue until the claim for interest was heard and determined. Accordingly, the 21-day period under s.95(2)(b) MAC Act would not commence to run until the interest claim was determined and a s.94 certificate and reasons had issued.

41 However, the Assessor did not characterise the certificate and statement of reasons of 30 December 2005 as draft documents. On their face, the documents purported to deal to finality with Mr Crazzi’s claim for damages and costs.

Some Findings in the Reasons of 30 December 2005

42 In the statement of reasons dated 30 December 2005, Assessor Flynn noted that counsel for the insurer had supplied him with the report of Dr Blue dated 20 October 2005 and reports of Dr Derrick Lovell dated 8 November and 5 December 2005 (TB168), and an extract from Dr Blue’s report was incorporated in the reasons (TB168-169). Assessor Flynn referred to the submission for Allianz that a further medical assessment of Mr Crazzi ought be undertaken, and that an assessment of damages for non-economic loss under s.131 MAC Act should not occur until that further assessment had been made (TB179-180).

43 It is noteworthy that counsel for Mr Crazzi submitted to Assessor Flynn that the sum of $200,000.00 should be awarded for non-economic loss (TB63). Counsel for Allianz submitted to Assessor Flynn that, subject to a determination of the insurer’s application for further medical assessment, Mr Crazzi ought be assessed in respect of non-economic loss in the amount of $120,000.00 (TB116, 179-180).

44 In his statement of reasons of 30 December 2005, Assessor Flynn said with respect to the claim for non-economic loss (TB180):

“In my view, the accurate method of assessing the claimant's entitlement for non-economic loss is one where I need to be cognisant of the following matters:

- his age;

- the nature and extent of his injuries and continuing disabilities;

- the nature and extent of his pre-injury activities;

- the extent to which these activities have been restricted as a consequence of his injuries.

Prior to the accident, the claimant was healthy and was an active fulltime member of the work force who looked forward to continuing on with his active lifestyle for a significant period. I have no reason whatsoever to doubt the validity of these objectives particularly in circumstances where for all intents and purposes he was untouched in relation to any credit issue that might relate to these matters as a consequence of being questioned by very experienced counsel briefed for the insurer during the course of the assessment hearing.”

45 The Assessor then referred to principles in Hodgson v Crane (2002) 55 NSWLR 199 concerning assessment of damages for non-economic loss under the MAC Act. Assessor Flynn concluded that part of his statement of reasons relating to non-economic loss in the following way (TB182-183):

“In the circumstances I am completely satisfied that the claimant has not sought to embellish his symptoms and he provides a very reliable and truthful version of his disabilities.

I have no doubt whatsoever that the claimant has sustained serious injuries which have significantly impacted upon his lifestyle and there is no doubt that by reference to the medical evidence that it is a trauma that is permanent and he will be troubled with an ongoing disability for the balance of his lifetime.

Having regard to all of these matters, it is my view that an appropriate award for non-economic loss in the circumstances is $140,000.00.”

46 At the conclusion of the statement of reasons, Assessor Flynn summarised his assessment of damages in the following way (TB198):

“I assess the claim as follows on the basis set out above:
- Non-economic loss $140,000.00
- Past economic loss $150,420.00
- Future economic loss $308,975.00
- Past Treatment expenses (agreed) $ 4,801.40
- Future treatment expenses $ 25,000.00
- Past care expenses or
gratuitous assistance $ 56,810.00
- Future care expenses or
gratuitous assistance $100,000.00

TOTAL $786,006.40”

47 I note that the allowance of $308,975.00 for future economic loss involves a typographical or calculation error which is apparent from an earlier part of the statement of reasons (TB191). The sum which Assessor Flynn intended to allow for future economic loss was, in fact, $308,524.50. I will return to this aspect later in this judgment.

48 If the certificate issued by Assessor Flynn on 30 December 2005 constituted a “certificate of assessment” for the purposes of ss.94 and 95 MAC Act, then significant consequences would flow if Mr Crazzi did not accept the amount of damages in settlement of his claim within 21 days after the certificate of assessment issued: s.95(2)(b) MAC Act.

The Assessor is Reminded of the Claim for Interest

49 Unsurprisingly, given the approach to the claim for interest adopted at the hearing of 7 December 2005, Mr Crazzi’s solicitor wrote to Assessor Flynn on 9 January 2006 in the following terms (TB202):

“We thank you for your letter of the 30th of December 2005 enclosing Certificate and Reasons.

We note that at the conclusion of the assessment conference the claimant flagged an entitlement to interest on the award. Mr Fitzsimmons of Counsel indicated that that issue would be properly dealt with after the reasons had been published.

The insurer has made no offer of settlement and we wish to make application for an award of interest.
We are currently preparing Submissions and will forward same in the near future.
In the event that it is appropriate to make application in another manner would you kindly advise.”

50 On 10 January 2006, the solicitors for Allianz wrote to the Medical Assessment Services section of the MAA seeking an early response with respect to the request for further medical assessment of Mr Crazzi “as this matter has proceeded through a CARS General Assessment and the outcome of our application may affect the award” (TB203).

51 On 12 January 2006, the solicitors for Mr Crazzi supplied Assessor Flynn and the solicitors for Allianz with a written submission on interest by way of “application under the slip rule” (TB204-209). The written submission contended as well that an erroneous approach had been taken by the Assessor to calculation of damages for loss of superannuation contributions and for past economic loss to the date of calculation of damages as at 30 December 2005. It was submitted that the assessment of damages for economic loss should be varied to allow the sum of $155,762.00 for past economic loss (including superannuation) and the sum of $315,318.00 for future economic loss (including superannuation), leading to a total sum of damages in the sum of $797,691.40 (TB207).

52 With respect to the claim for interest, counsel for Mr Crazzi submitted (TB207-208):

“2.1 The awarding of interest is governed by Section 137 of the Motor Accidents Compensation Act 1999. In relation to the present claim, interest is only available to the Claimant on damages for past economic loss. Interest can only be awarded in the circumstances identified in Section 137(4) of that Act.

2.2 The Insurer has never made any offer to the Claimant in respect of his entitlement to damages. The Insurer did not even offer the Claimant the amount it submitted should be awarded to him.

2.3 It is submitted that in these circumstances the Claimant is entitled to interest on the damages for past economic loss pursuant to Section 137(4)(a)(i) of the Motor Accidents Compensation Act 1999. As to the approach to such a provision see Marsland v Andjelic (No.2) (1993) 32 NSWLR 649 at 651-652 per Kirby P and Meagher JA, esp. at 652B-E.

2.4 The rate at which interest is to be awarded is three quarters of the rate prescribed for the purposes of Section 95 of the Supreme Court Act 1970 in respect of the relevant periods. The subject accident occurred on 3 July 2001 and economic loss was sustained commencing on 5 July 2001. The rate prescribed for the purposes of Section 95 of the Supreme Court Act 1970 was 10% per annum from 5 July 2001 to 28 February 2002 and 9% per annum thereafter. Three quarters of the average rate of that period is 6.85% per annum. The period is almost precisely 4½ years.

2.5 Interest on past economic loss of $155,762 at 6.85% per annum for 4½ years totals $48,014. It is submitted that this amount should be added to the damages previously assessed (in accordance with the submissions above) in the sum of $797,691.40 to produce a total award of $845,705.40.”

53 It was then submitted that, allowing for the adjustment and interest referred to in the submission, an appropriate reassessment in relation to Mr Crazzi’s costs ought be made in accordance with a schedule annexed to the submission (TB208-209).

54 It was common ground before me that the letter of 9 January 2006 from Mr Crazzi’s solicitors did not constitute an acceptance of the amount of damages in the purported certificate of assessment of 30 December 2005 for the purposes of s.95(2)(b) MAC Act. I raised with senior counsel for Allianz and Mr Crazzi the question whether this letter involved an acceptance of the primary calculations contained in the certificate and statement of reasons, subject to the interest application which the parties had agreed ought be considered separately and after the determination of other heads of damages. There is no prescribed form for acceptance of a certificate of assessment for the purposes of s.95(2)(b) MAC Act.

55 It might be thought that a beneficial construction ought be given to the provisions in s.95(2)(b) so that an express or implied acceptance of the assessment of damages as contained in the certificate ought suffice. However, it is not necessary to consider this issue further given that senior counsel for Allianz and Mr Crazzi both contended that the actions of Mr Crazzi’s solicitors in the letter of 9 January 2006 and thereafter did not constitute an implied acceptance of the assessment. In any event, it is clear that the written submissions supplied to the Assessor on 12 January 2006 sought to dispute the basis for calculation of aspects of the damages quite apart from the question of interest.

56 I approach the resolution of the present proceedings upon the basis that there was no acceptance by Mr Crazzi for the purposes of s.95(2)(b) MAC Act, of the damages set out in the purported certificate of assessment dated 30 December 2005.

Solicitors for Allianz Correspond with the Principal Claims Assessor

57 The response of the solicitors for Allianz to the letter of 9 January 2006 was to write to Assessor Flynn, on 23 January 2006, a letter which included the following (TB210):

“We are instructed to put the matter before the Principal Assessor given the provisions of Section 94(6) and we request that you not proceed further until the Principal Assessor has dealt with it.”

58 I observe, at this point, that the solicitors for Allianz were not approaching the matter upon the basis that the purported certificate of assessment of 30 December 2005 had, with the passing of the 21-day period, moved beyond reach of Mr Crazzi by way of acceptance under s.95(2)(b) MAC Act. Allianz was approaching the matter upon the basis that there were issues for the Principal Claims Assessor to consider in the exercise of her statutory function under s.94(6) of the Act. I will return, in due course, to consider this provision and its proper construction.

59 By letter dated 24 January 2006, the solicitors for Allianz wrote to Ms Belinda Cassidy, the Principal Claims Assessor, a letter described as a “Section 94(6) application” (TB211-213). Allianz ventilated a number of matters including that Assessor Flynn had no jurisdiction to entertain an application for calculation of superannuation and for the addition of interest and that it was for Mr Crazzi to make a s.94(6) application to the Principal Claims Assessor in that respect. The letter proposed the following approach (TB213):

“You might think that the appropriate course for the moment is to direct the Assessor to refer the Claimant's application to you to be dealt with in accordance with Section 94(6). It may be relevant to the exercise of your power under Section 94(6) to note that there has been no acceptance within the meaning of Section 95(2)(b).

In the meantime our client's application is for a Section 94(6) amendment of the Certificate of 23 December 2005 as to the amount for past domestic assistance. On page 30 of his Reasons the Assessor has indicated a finding that the appropriate allowance is ‘within the vicinity of $40,000’ but his assessment of damages includes a figure of $56,810. That is the amount of the Claimant's claim which the Assessor found was ‘slightly excessive’. In our client's submission the amount should be reduced to $40,000.”

Mr Crazzi Referred for Further Medical Assessment

60 On 24 January 2006, Ms Annika Brinsley, Case Manager, Motor Accidents Assessment Service within the MAA, informed the solicitors for Allianz that a determination had been made that Mr Crazzi was eligible for a further medical assessment under s.62(1)(a) MAC Act upon the basis that additional information relevant to the injuries had been provided (TB214). Section 62 provides as follows:

“62 Referral of matter for further medical assessment

(1) A matter referred for assessment under this Part may be referred again on one or more further occasions in accordance with this Part:


(a) by any party to the medical dispute, but only on the grounds of the deterioration of the injury or additional relevant information about the injury, or

(b) by a court or claims assessor.

207 In the present case, the Assessor had exercised his statutory function under s.94 MAC Act virtually to completion. He was not bound to defer the issue of a s.94 certificate pending the further medical assessment process. It was open to the Assessor to consider and determine the sole remaining question and to then issue a s.94 certificate and statement of reasons, as he did, on 23 March 2006.

208 Allianz has not demonstrated an entitlement to relief as claimed in the Summons.

Discretionary Factors

209 In view of the conclusions which I have reached in respect to the claim by Allianz, it is not strictly necessary to deal with the question of discretion. However, since the matter was fully argued before me, I propose to make some observations concerning this aspect of the case.

210 In the event that some basis for relief had been demonstrated, Mr Petty SC made forceful submissions that there were discretionary reasons as to why that relief ought be refused in any event. He pointed, in particular, to the fact that the origin of the present controversy stemmed from the submission of Allianz, on 7 December 2005, that Mr Crazzi’s claim for interest be considered separately and at a later time after other aspects of his claim for damages had been assessed. Mr Crazzi’s counsel agreed to this proposal which was accepted by the Assessor. Had counsel for Allianz not advanced this proposal, the hearing would have been completed on 7 December 2005 and Assessor Flynn would have issued a certificate dealing with all aspects of the claim. It would have been open to Mr Crazzi to accept the sum of damages assessed in that certificate under s.95(2)(b) MAC Act.

211 Mr Petty SC points to other events which, he submits, are relevant to the exercise of discretion. Once the purported certificate and statement of reasons dated 30 December 2005 had issued, it being immediately clear that the Assessor had overlooked the interest claim, the solicitors for Allianz engaged in correspondence which was not calculated to foster a just and quick resolution of the problem. Allianz did not contend that the 21-day period was running from 30 December 2005 until after this prospect was raised by the Principal Claims Assessor. It was then, for the first time, that Allianz contended that the time for Mr Crazzi to accept the purported certificate had expired.

212 Mr Crazzi accepted the s.94 certificate of 23 March 2006. If that certificate was declared void, and the purported certificate of 30 December 2005 stood, Mr Crazzi would be out of time to accept the assessment contained in that certificate. Mr Petty SC points to the duty upon an insurer under s.80(1) MAC Act which provides:

“It is the duty of an Insurer to endeavour to resolve a claim, by settlement or otherwise, as justly and expeditiously as possible.”

213 It is a condition of an insurer’s licence to comply with this duty: s.80(2). Mr Petty SC submits that the actions of Allianz in this case do not sit comfortably with the statutory duty cast upon the insurer under this provision.

214 Mr Petty SC submits that, if Allianz succeeds in setting aside the certificate of 23 March 2006, that result will defeat the implementation of a proposal which its own counsel made at the assessment conference on 7 December 2005 and thus the Court should not lend its hand to such a result.

215 Put shortly, Mr Petty SC submitted that Allianz had brought all of this upon itself and that it should not benefit from a state of affairs which it generated, even if a technical legal entitlement to relief could be demonstrated.

216 Mr Robertson SC submitted that no basis had been demonstrated for the discretionary refusal of relief if Allianz was otherwise entitled to its remedy.

217 It will be recalled that I determined that s.94(6) was not available to remedy the problem in this case. What occurred here resulted from a jurisdictional error involving a denial of procedural fairness and a failure by the Assessor to exercise his jurisdiction under s.94 MAC Act.

218 If, however, I am wrong in this respect and s.94(6) did apply, I would decline relief to Allianz on discretionary grounds.

219 It would be expected that Allianz should have promptly acknowledged the obvious mistake made in its favour and should have co-operated in having the mistaken order vacated: Ambulance Service of NSW v Daniel [2004] NSWCA 406 at paragraph 7.

220 If s.94(6) was an available pathway to remedy the Assessor’s failure to hear and determine the claim for interest, it would have been inevitable that the Principal Claims Assessor would have approved of the claims assessor issuing a replacement certificate or statement of reasons to correct the error. Assessor Flynn would have heard and determined the claim for interest and issued a fresh certificate disposing of all aspects of Mr Crazzi’s claim.

221 At the same time, it would have been open to the Principal Claims Assessor to approve of Assessor Flynn correcting the calculation error in the replacement certificate and statement of reasons. If these steps had been taken, the 21-day period provided for in s.95(2)(b) MAC Act would not have commenced to run until Assessor Flynn had issued a s.94 certificate and statement of reasons remedying these errors and completing the exercise of his statutory function.

222 Ultimately, that is precisely what has happened in this case. Assessor Flynn completed the exercise of his jurisdiction and, after considering the claim for interest, determined not to allow it. Mr Crazzi accepted the assessment contained in the s.94 certificate which issued following Assessor Flynn’s completion of his statutory function.

223 Alternatively, if Allianz had demonstrated that Assessor Flynn had fallen into jurisdictional error in his approach to the s.62 medical assessment issue, in issuing the s.94 certificate and statement of reasons on 23 March 2006, the same discretionary factors, in my view, would stand in the way of the grant of relied sought in the Summons.

224 There is no closed category of cases in which prerogative relief may be refused on discretionary grounds. Likewise, the power to grant declaratory relief is discretionary and it is neither possible nor desirable to fetter the power by laying down rules as to the manner of its exercise: Ainsworth v Criminal Justice Commission at 581-582. Although it has been said that prerogative relief will issue almost as of right, relief may be refused if, in all the circumstances, that seems the proper course: R v Ross-Jones; Ex parte Green (1984) 156 CLR 185 at 194; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 106 [52], 137 [149], 144 [172]; Aronson, Dyer and Groves, Judicial Review of Administrative Action, 3rd edn, 2004, pages 714-719, 736-745, 787-788, 789-793.

225 The principles applicable to the exercise of discretion where relief is sought under s.69 Supreme Court Act 1970 appear in The King v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Limited (1949) 78 CLR 389 at 400 where Latham CJ, Rich, Dixon, McTiernan and Webb JJ said:

“… The writ of mandamus is not a writ of right nor is it issued as of course. There are well recognised grounds upon which the court may, in its discretion, withhold the remedy.

For example the writ may not be granted if a more convenient and satisfactory remedy exists, if no useful result could ensue, if the party has been guilty of unwarrantable delay or if there has been bad faith on the part of the applicant, either in the transaction out of which the duty to be enforced arises or towards the court to which the application is made. The court’s discretion is judicial and if the refusal of a definite public duty is established, the writ issues unless circumstances appear making it just that the remedy should be withheld. The question whether there are any grounds for refusing the remedy will be discussed after the question of the jurisdiction of the Court of Conciliation and Arbitration has been considered.”

226 In Zuanic v Gyro-Tech (Australia) Pty Ltd (In Liquidation) [2006] NSWSC 738 at paragraphs 75-78, Hoeben J indicated that, if the Plaintiff had established an entitlement to prerogative and declaratory relief, such relief would have been refused in any event on discretionary grounds applying the Ozone Theatres principle.

227 It has been said that the Court may refuse to exercise its discretion to grant prerogative relief to an applicant if the applicant’s conduct has been unmeritorious (Wade, Administrative Law, 1982, 5th edn, pages 477, 591), blameworthy (Peko-Wallsend Limited v Minister for Aboriginal Affairs (1985) 5 FCR 532 at 541-3, 560-561, 569) or the applicant acquiesced in the conduct of the proceedings in which he is complaining (Aronson, Dyer and Groves, above at page 718; Sykes, Lanham and Tracey, General Principles of Administrative Law, 1989, 3rd edn, page 240).

228 In my view, there are features of this case which would operate against the grant of a discretionary remedy to Allianz if it had established a technical basis for such relief. It is clear that Allianz was dissatisfied with the Assessor’s refusal of the adjournment applications made prior to and at the assessment conference on 7 December 2005. Those were decisions, however, which lay within the Assessor’s discretionary powers. The assessment hearing proceeded on the merits and Allianz participated fully in it. The hearing was completed except for the claim for interest which Allianz proposed ought be dealt with at a later time.

229 Since 30 December 2005, Allianz has adopted a stance, or stances, designed to advance its own interests to the detriment of Mr Crazzi’s interest. This is to be expected in disputed insurance claims, even under a statutory scheme such as that contained in the MAC Act. However, there is a somewhat opportunistic element revealed in the way in which Allianz has approached the problems which have evolved from its own submission that the claims assessment process should be fragmented.

230 In the context of application of the slip rule to cure an obvious mistake, Hodgson JA (Sheller and Beazley JJA agreeing) observed in Ambulance Service of NSW v Daniel, at paragraph 7, that a party should have promptly acknowledged an obvious mistake made in its favour and should have co-operated in having the mistake and order vacated. In my view, this proposition may be called in aid by Mr Crazzi in the present case with respect to the approach which Allianz ought to have taken immediately after it became apparent, on 30 December 2005, that Assessor Flynn had overlooked the claim for interest which had been deferred on the application of Allianz.

231 In the result, the certificate and statement of reasons which issued on 23 March 2006 operated to the advantage of Allianz in a number of respects. Firstly, it had the opportunity to resist the claim for interest by reference to the offer of settlement made on 6 February 2006. Allianz would not have been able to adopt this stance if the claim for interest had been argued on 7 December 2005. Secondly, there was a correction of a calculation error which reduced the award of damages to be paid by Allianz. The fact that this calculation error was capable of being remedied under s.94(6) MAC Act ought not, for discretionary reasons, assist Allianz in these proceedings.

232 I am conscious that, by February 2006, a further medical assessment under s.62 MAC Act had been approved. No doubt, Allianz wished to maximise the prospect that the s.62 process might thereafter operate to its financial advantage. However, Allianz was only in a position to agitate that issue after 30 December 2005 because of the fragmentation of the assessment process which Allianz had itself initiated, followed by the Assessor’s failure to hear and determine the interest claim.

233 The disadvantages which may flow from fragmentation of civil litigation, including unexpected complications, have been emphasised: Tepko Pty Limited v Water Board (2001) 206 CLR 1 at 55. The present case highlights the additional potential for complication where part of a claim for damages under the MAC Act is placed to one side for consideration separately from the balance of the claim. It is apparent that the claims assessment process under Part 4.4 MAC Act envisages a single decision-making process by an assessor leading to the issue of a single s.94 certificate and statement of reasons. Had that approach been adhered to in the present case, the present controversy could have been avoided.

Conclusion

234 I am not satisfied that Allianz has demonstrated an entitlement to the declaratory and prerogative relief sought in the Summons. A consequence of this conclusion is that the certificate issued by Assessor Flynn on 23 March 2006 is valid and that Mr Crazzi has accepted that certificate for the purposes of s.95(2)(b) MAC Act.

235 I make the following orders:

(a) Summons dismissed;

(b) the Plaintiff is ordered to pay the costs of the First Defendant;

(c) no order as to the costs of the Second and Third Defendants.

**********

09/10/2007 - In paragraph 5, there was an incorrect reference to a provision under the Uniform Civil Procedure Rules 2005 - Paragraph(s) Paragraph 5