Allianz Australia Insurance Limited v Estate of the Late Summer Abawi

[2025] NSWCA 85

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Allianz Australia Insurance Limited v Estate of the Late Summer Abawi [2025] NSWCA 85

Hearing dates:

11 March 2025

Date of orders:

02 May 2025

Decision date:

02 May 2025

Before:

Kirk JA at [1];
Adamson JA at [78];
Stern JA at [80]

Decision:

(1) The second respondent is to be identified as the Personal Injury Commission Review Panel in lieu of the names of the members constituting the panel.

(2) Leave to appeal is granted.

(3) Appeal allowed.

(4) Set aside so much of the order made by Griffiths AJA on 4 October 2024 as dismissed the summons filed on 4 June 2024 and in lieu thereof order:

(a) The decision of the second defendant made on 15 March 2024 is set aside.

(b) In place of that decision, the Certificate of Assessor Home dated 5 October 2022 is confirmed.

(5) The appellant is to pay the first respondent’s costs of the appeal.

Catchwords:

STATUTORY INTERPRETATION – extrinsic material – significance of delegated legislation to construction of a statute – relevance to statutory construction of legislative facts and claims asserted from the bar table – multiple statutory purposes – issue determined by textual considerations where none of the purposive and contextual arguments raised assists greatly to resolve construction issue

TRAFFIC LAW AND TRANSPORT – traffic law – motor accident legislation – definition of “threshold injury” – injury to the skin which is not also an injury to nerves is a soft tissue injury

Legislation Cited:

Interpretation Act 1987 (NSW), s 34(2)

Motor Accident Injuries Act 2017 (NSW), ss 1.3, 1.4(1), 1.6, 3.11, 3.28, 4.1, 4.4, 7.1, 7.17, Sch 2 cl 2(e)

Motor Accident Injuries Regulation 2017 (NSW)

Motor Accident Guidelines

Cases Cited:

Abawi v Allianz Australia Insurance Limited [2024] NSWPICMP 158

ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1; [2014] HCA 18

Al-Khafaji v Insurance Australia Limited t/as NRMA Insurance [2022] NSWPICMP 519

Cheers v Mid Coast Council [2024] NSWSC 1553

Dhupar v AAI Limited t/as GIO [2023] NSWPICMP 99

Eastman v The Queen (2000) 203 CLR 1; [2000] HCA 29

Eftikhari v AAI Limited t/as AAMI [2023] NSWPICMP 93

Elazac Pty Ltd v Commissioner of Patents (1994) 53 FCR 86

Great Fingall Consolidated Ltd v Sheehan (1905) 3 CLR 176; [1905] HCA 43

Maloney v The Queen (2013) 252 CLR 168; [2013] HCA 28

Nazari v AAI Limited t/as GIO (No 2) [2023] NSWPICMP 62

PIPE Networks Pty Ltd v Commonwealth Superannuation Corporation (2013) 212 FCR 542; [2013] FCA 444

Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1; [2012] HCA 46

SkyCity Adelaide Pty Ltd v Treasurer of South Australia [2024] HCA 37; (2024) 98 ALJR 1273

White v Commissioner of Police [2024] NSWSC 219; (2024) 329 IR 323

Wilcox Mofflin Ltd v New South Wales (1952) 85 CLR 488; [1952] HCA 17

Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; [2002] HCA 9

Texts Cited:

DC Pearce, Statutory Interpretation in Australia (LexisNexis, 10th edn, 2024)

Macquarie Dictionary, online ed

P Herzfeld and T Prince, Interpretation (Lawbook, 3rd edn, 2024)

State Insurance Regulatory Authority, Review of Minor Injury Definition in the NSW CTP Scheme, (2020)

Category:

Principal judgment

Parties:

Allianz Australia Insurance Limited (Applicant)
The Estate of the Late Summer Abawi (First respondent)
Personal Injury Commission Review Panel (Second respondent)
The President of the Personal Injury Commission of New South Wales (Third respondent)

Representation:

Counsel:
P Herzfeld SC / J Gumbert (Applicant)
A Stone SC / J Magee (First respondent)

Solicitors:
McInnes Wilson Lawyers (Applicant)
Phil Banister Pty Ltd (First respondent)

File Number(s):

2024/374574

Publication restriction:

Nil

 Decision under appeal 

Court or tribunal:

Supreme Court

Jurisdiction:

Common Law

Citation:

Allianz Australia Insurance Limited v The Estate of the Late Summer Abawi [2024] NSWSC 1245

Date of Decision:

4 October 2024

Before:

Griffiths AJA

File Number(s):

2024/206923

HEADNOTE

[This headnote is not to be read as part of the judgment]

In a motor vehicle accident in 2017, Ms Summer Abawi suffered various injuries including superficial lacerations to each wrist. She passed away in 2021 for reasons unrelated to the accident. Her claim was pursued by her estate (the estate). The applicant (Allianz) was the compulsory third party insurer of the vehicle at fault. It asserted, relevantly, that Ms Abawi’s injuries were all “minor injuries” (the pre-2023 label for “threshold injuries”) for the purposes of s 1.6 of the Motor Accident Injuries Act 2017 (NSW) (the Act). If that is so, there is a limitation on the estate’s ability to claim statutory benefits and damages. A medical assessor of the Personal Injury Commission determined that each of Ms Abawi’s injuries was a minor injury. A review panel concluded that the lacerations to the skin on Ms Abawi’s wrists were not threshold injuries. Allianz sought judicial review of that decision in the Supreme Court, which dismissed the application.

The sole issue on appeal was whether an injury to the skin (which is not also an injury to nerves) is a “soft tissue injury” as defined in s 1.6 of the Act.

The Court (per Kirk JA, Adamson and Stern JJA agreeing) allowed the appeal and held:

1. The word “other” in the text “other structures or organs” qualifies both “structures” and “organs”: at [33]. If the definition is understood to mean tissue performing certain functions with respect to other structures or other organs, then it is clear that both the structures and the organs referred to may themselves be tissue. The natural reading of the text then is that organs are capable of being soft tissue within the meaning of the definition, contrary to the construction advocated by the estate, subject to consideration of the “connects, supports or surrounds” limitation. Most organs are excluded not because they cannot be soft tissue per se, but because they fall outside that functional requirement: at [34].

2. The words “connects” and “surrounds” are naturally best understood as denoting a physical relationship: at [36]. Connecting, supporting or surrounding other structures or organs in a physical sense should be a significant and characteristic feature of the tissue in question, that is, sufficient to warrant that tissue being characterised as having that physical function: at [38].

3. The matter should not be remitted to the review panel for determination because first, the estate concedes that if the Court accepts Allianz’s construction (as it has) then skin should be characterised as soft tissue; second, whilst the estate asserted that the issue of whether the lacerations in question may have involved any injury to nerve endings should be remitted, there is no reason to doubt the medical assessor’s conclusion as to the absence of evidence of nerve damage: at [72]-[74].

Per Kirk JA, Stern JA agreeing, Adamson JA not deciding:

4. Neither the Motor Accident Injuries Regulation 2017 (NSW) nor the Motor Accident Guidelines can be taken into account in construing s 1.6(2) of the Act: at [47]. Delegated legislation or a statutory guideline which did not exist when the statute was being enacted, and the relevant content of which was not otherwise foreshadowed to the Parliament, cannot properly be regarded as throwing light on Parliament’s intentions: at [50].

Great Fingall Consolidated Ltd v Sheehan (1905) 3 CLR 176; [1905] HCA 43; Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1; [2012] HCA 46; Elazac Pty Ltd v Commissioner of Patents (1994) 53 FCR 86; PIPE Networks Pty Ltd v Commonwealth Superannuation Corporation (2013) 212 FCR 542; [2013] FCA 444, referred to.

5. Allianz’s floodgates argument, which depends on a factual premise asserted from the bar table that in almost every car accident there will be a skin injury, is unpersuasive: at [53]. Not only is the evidence Allianz cited insufficient, some material it provided to the Court undermined its argument: at [54].

Wilcox Mofflin Ltd v New South Wales (1952) 85 CLR 488; [1952] HCA 17; Eastman v The Queen (2000) 203 CLR 1; [2000] HCA 29; Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; [2002] HCA 9; Maloney v The Queen (2013) 252 CLR 168; [2013] HCA 28, referred to.

6. An acceptance of the significance of an object of the Act as stated in s 1.3(2)(d) says nothing as to how the definition of soft tissue injuries should be construed: at [59]. For much the same reason the opposite view citing other purposes of the Act should also be rejected: at [60].

ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1; [2014] HCA 18, referred to.

7. Any uncertainty created by assessing whether there has been an injury to nerves is simply a consequence of the statutory choice to enact that exclusion. These are matters capable of medical assessment: at [67]. There are some odd and anomalous effects of the definitions of the Act whichever way the definition at issue is construed. The existence of such anomalies does not assist in construing that definition: at [69]. In sum, none of the purposive and contextual arguments raised by the primary judge or the parties do much to assist to resolve the construction issue. The issue falls to be determined by the textual considerations which support the construction put by Allianz: at [70].

JUDGMENT

1. KIRK JA: The sole issue in this appeal is whether an injury to the skin (which is not also an injury to nerves) is a “soft tissue injury” as defined in s 1.6 of the Motor Accident Injuries Act 2017 (NSW) (the Act). The issue has been considered by a number of review panels of the Personal Injury Commission in recent times, reaching different answers, and with even those panels reaching the same conclusion adopting different reasoning to each other: Al-Khafaji v Insurance Australia Limited t/as NRMA Insurance [2022] NSWPICMP 519 at [98]; Nazari v AAI Limited t/as GIO (No 2) [2023] NSWPICMP 62 at [70]-[79]; Eftikhari v AAI Limited t/as AAMI [2023] NSWPICMP 93 at [116]-[127]; Dhupar v AAI Limited t/as GIO [2023] NSWPICMP 99 at [77]-[129].

2. The review panel in this matter concluded that the answer was “no”, because skin did not fall within the description of “soft tissue”: Abawi v Allianz Australia Insurance Limited [2024] NSWPICMP 158 (RP) at [43]-[65]. The issue then came before the primary judge, Griffiths AJA, by way of judicial review. His Honour reached the same conclusion albeit for somewhat different reasons to those given by the panel under review: Allianz Australia Insurance Limited v The Estate of the Late Summer Abawi [2024] NSWSC 1245 (J). As his Honour observed, the issue is far from straightforward.

3. In my view the answer is “yes”; an injury to skin which is not an injury to nerves is, of itself, a soft tissue injury in the sense defined in the Act. It should be noted that the arguments of both sides had evolved from what was put below.

4. The particular case in which the question arises requires leave to appeal because of the limited value of what is at stake. It is clear that the case raises an issue of principle and of general public importance. The applicant, an insurer (Allianz), accepted that that characterisation is of little practical consequence to the first respondent (the estate). It therefore offered as a condition of leave to appeal to pay the costs of the estate and not to seek to vary the costs order made below. That was an appropriate position for it to adopt. Leave to appeal should be granted on the basis accepted by the applicant. The appeal should be upheld.

5. In what follows I first set out the context in which the issue arises, then address the text of the provision, before considering arguments as to its context and purpose, and finally turning to two consequential factual issues.

Background

6. Ms Summer Abawi was injured in a motor vehicle accident in this State on 8 December 2017. The injuries she claimed to have suffered as a result were whiplash, aggravation of prior neck and lower back injuries, injuries to her shoulders, and superficial lacerations of the skin on both of her wrists. An ambulance report after the accident stated that there was a 3 cm superficial laceration to each wrist, with the left wrist marked by abrasion and swelling.

7. Ms Abawi passed away in 2021 for reasons unrelated to the accident. Her claim was pursued by her estate.

8. Allianz was the compulsory third party insurer of the vehicle at fault. It did not accept that she had suffered all of the claimed injuries in the accident and in any event asserted that they were all “minor injuries” for the purposes of s 1.6 of the Act (the previous label for “threshold injuries”).

9. The significance of such a characterisation is that if the claimant’s only injuries fall into that category then they are disentitled, first, from receiving statutory benefits for loss of earnings and for treatment and care expenses incurred after 52 weeks (see ss 3.11 and 3.28 of the Act) and, second, from obtaining damages (see ss 4.1 and 4.4 of the Act). The notion thus serves as a limitation on the ability to claim statutory benefits and damages. Despite the change in label, it remains apparent that the purpose of the notion is to filter out liability for certain minor injuries.

10. The dispute as to cause and characterisation of the injuries was a “medical dispute” under the Act: see s 7.1, s 7.17, and Sch 2, cl 2(e). It was referred to the Personal Injury Commission for determination. On 5 October 2022 Medical Assessor Dr Alan Home determined (on the papers) that each of Ms Abawi’s injuries was a minor injury for the purpose of the Act as it then stood. The estate sought a review of that determination.

11. The label “minor injuries” in s 1.6 was altered to “threshold injuries” by an amendment to the Act passed in 2022 which took effect on 1 April 2023. The definition was not otherwise changed. The review panel proceeded on the basis that the issue before it was whether or not the injuries were “threshold injuries” rather than “minor injuries”. I note that the parties proceeded, both in this Court and the Court below, on the basis that the amended version of the provision was what was relevant. I will do likewise.

12. The review panel was constituted by a member of the Motor Accidents Division and two medical assessors. On 15 March 2024 it determined that whilst the rest of Ms Abawi’s injuries were properly characterised as threshold injuries under s 1.6, the lacerations to the skin on each of her wrists were not. The panel’s reasons concluded as follows:

[64] To exclude an injury to the skin because it “connects, supports or surrounds other structures” is inconsistent with the meaning intended to be ascribed to this threshold’s provision’s phraseology when read in the statutory context, which is evidently concerned with the exclusion of soft tissue injuries sustained to the connective tissues of the musculoskeletal system, which do not involve injury to nerves or a complete or partial rupture of tendons, ligaments, menisci or cartilage.

[65] Accordingly, lacerations to the skin would not be a threshold injury.

13. Allianz sought judicial review of the decision in the Supreme Court. Griffiths AJA dismissed the application.

Text

14. Section 1.6 of the Act provides as follows:

1.6 Meaning of “threshold injury”

(1) For the purposes of this Act, a threshold injury is, subject to this section, one or more of the following—

(a) a soft tissue injury,

(b) a psychological or psychiatric injury that is not a recognised psychiatric illness.

(2) A soft tissue injury is (subject to this section) an injury to tissue that connects, supports or surrounds other structures or organs of the body (such as muscles, tendons, ligaments, menisci, cartilage, fascia, fibrous tissues, fat, blood vessels and synovial membranes), but not an injury to nerves or a complete or partial rupture of tendons, ligaments, menisci or cartilage.

(3) (Repealed)

(4) The regulations may—

(a) exclude a specified injury from being a threshold injury for the purposes of this Act, or

(b) include a specified injury as a threshold injury for the purposes of this Act.

(5) The Motor Accident Guidelines may make provision for or with respect to the assessment of whether an injury is a threshold injury for the purposes of this Act.

(6) Subsection (5) does not enable the Motor Accident Guidelines to make provision for or with respect to the resolution of disputes by the Commission or medical assessor.

15. The issue is whether skin falls within the phrase in subs (2) of “tissue that connects, supports or surrounds other structures or organs of the body”. Skin is not included in the list of examples in the words in brackets in the definition (“such as muscles …”) nor is it included in the stated exclusions (“nerves …”).

Some points of agreement

16. The parties agreed on some significant points. Allianz accepted the following anatomical explanation given by the review panel in this matter as sufficient for current purposes:

[52] … The human body is a single organism, but it is made up of billions of smaller structures of four major kinds: cells, tissues, organs, and systems. A tissue is a group of many similar cells (though sometimes composed of a few related types) that work together to perform a specific function. An organ is an anatomically distinct structure of the body composed of two or more tissue types so arranged that together they can perform a special function. A system is an organisation of varying numbers and kinds of organs so arranged that together they can perform complex functions for the body.

17. The parties agreed that skin is both tissue and an organ.

18. The estate did not dispute that skin supports or surrounds organs of the body. It thus accepted that skin falls within the ordinary meaning of the words employed in the definition of “soft tissue injury” in s 1.6(2).

19. Both sides accepted that organs such as the heart and the brain can be said at least in one sense to support other structures or organs of the body. They agreed that the Parliament cannot have intended that those organs be regarded as soft tissue within the meaning of s 1.6. Thus although neither side conceded that their construction sought to read the key phrase in a limited way, in fact both constructions did so.

The competing constructions

20. The primary judge did not articulate a general construction of the key phrase in s 1.6(2). No doubt that reflected how the case was argued below. Instead, his Honour gave a range of reasons for expressing his agreement with the review panel’s “ultimate conclusion that, properly construed, an injury to skin is not a ‘soft tissue injury’ for the purposes of the definition” (J [66]).

21. In this Court the estate’s construction was that the definition does not extend to organs. That being so, organs such as the heart and the brain could not fall within the definition. The review panel in this matter adopted that sort of construction: RP [52] and [55]-[57]. The estate claimed that this was also “the central aspect” of the reasoning of the primary judge, referring to something his Honour said at J [63]. Allianz disputed that his Honour’s reasons should be understood in that way, referring to what his Honour said at J [63(3)] and [66]. It is unnecessary to address which understanding of his Honour’s reasons is correct. The issue is what construction of the provision is correct.

22. The construction put by the estate involves reading the definition as though it contained words to this effect: “tissue other than organs that connects, supports or surrounds other structures or organs of the body”. The estate had initially argued that it was sufficient to support its conclusion that the word “other” in this phrase did not qualify “organs”. However, it came to accept that it was then necessary to take the further step of reading down the earlier words in the definition so as not to apply to organs – a step it said was supported by its argument that “other” did not qualify “organs”.

20. Allianz’s construction was initially put as follows in this Court:

The operative part of the definition restricts the soft tissue concerned to that which “connects, supports or surrounds” other structures or organs of the body. That directs attention to tissue which has as its dominant feature the function of doing one or more of those three things. This then excludes most organ tissue, as the purpose and function of organs is not generally to “connect, support or surround” other structures or organs.

24. In the course of argument Allianz accepted that the reference to “purpose” was inapposite, potentially raising, as it did, metaphysical questions. Its focus then became whether the dominant or primary feature of the tissue in question was to perform the function of connecting, supporting or surrounding other structures or organs. In the course of argument the notion of dominant/primary was also qualified, as explained below.

25. Allianz also submitted that the notion of “support” – alike with “connect” and “surround” – was to be understood in a physical, not biological, sense. Thus although the heart and the brain might readily be understood to provide biological support to all other parts of the body, they did not fall within the definition because their dominant feature was not to provide physical support to other structures or organs.

26. The estate argued that Allianz’s construction involved placing an “unwarranted gloss” on the statutory text. Yet, as noted, both side’s constructions seek to read the definition down. Both are exercises in statutory construction, seeking to identify the meaning of the words used as understood in their context.

27. The parties’ constructions are not far apart in practical terms. The estate’s argument is not inconsistent with understanding the definition in a functional sense (even though it criticises referring to the dominant, primary or significant feature); it is just that tissue found in or comprising organs is excluded. Conversely, Allianz’s construction would exclude most organs, as it acknowledged, because in general they will perform their own specific function, rather than serving in a significant way the function of connecting, supporting or surrounding other structures or organs. Indeed, although it is not necessary to decide the point, it may well be that the only practical difference between the two constructions is with respect to skin.

Analysis

28. Allianz referred to two dictionary definitions of “soft tissue” to the effect of being tissue that is soft rather than bone or cartilage. It said that this “would be expected to include skin”. The High Court has recently confirmed the permissibility of considering the ordinary meaning of words used in a statutory definition as part of the statutory context: SkyCity Adelaide Pty Ltd v Treasurer of South Australia [2024] HCA 37; (2024) 98 ALJR 1273 at [32]. However, as the estate pointed out, accepting a working definition of “soft tissue” as “tissue that is soft” does not greatly advance debate. Indeed, in Allianz’s submissions to the primary judge it had provided some further definitions from public sources. As his Honour noted – consistently with the submission made to him by Allianz – skin was included in the definition of “soft tissue” in some sources but not others (at J [54]). Such definitions of “soft tissue” can be set aside.

29. As explained, the parties accepted the review panel’s description of “tissue” as “a group of many similar cells (though sometimes composed of a few related types) that work together to perform a specific function” (RP [52]). This notion identifies the grouping of cells by reference to their function. The review panel’s description of an organ was also a functional one: “an anatomically distinct structure of the body composed of two or more tissue types so arranged that together they can perform a special function” (ibid; emphasis added). That understanding is consistent with the relevant Macquarie Dictionary definition of “organ”, that is, “a part or member, as the heart, having some specific function”. And the review panel’s explanation of “system” was again functional: “an organisation of varying numbers and kinds of organs so arranged that together they can perform complex functions for the body” (RP [52]). The key notions at play here, thus, are all functional in nature.

30. There was some dispute as to what the word “structures” encompasses. Both sides seemed to accept that the notion was unclear. Allianz argued that it likely overlaps with organs. The estate submitted that one structure is the spine, and suggested the notion also included the neck, legs, arms and possibly the skull. It is unnecessary to resolve the issue here.

31. The description of “soft tissue” in s 1.6(2) seeks to delineate a subgroup of human tissue. The key words “connects, supports or surrounds” all describe the role played by that tissue. They address the nature of the function served by the type of tissue in question. That understanding is consistent with the functional nature of the concepts at issue. It lends some support to Allianz’s functional focus.

32. The estate’s approach can also be understood in functional terms, but with organs excluded. The estate called in aid the statement in Dhupar at [109] that it was “non-sensical that an injury to an organ could fall within the scope of an injury to ‘tissue that connects, supports or surrounds’ itself”. There was some argument about whether the review panel in that matter was simply making a point about an organ supporting (etc) itself. Regardless, the point the estate was asserting was that the definition in s 1.6(2) was directed to soft tissue other than organs.

33. A critical issue – the estate called it “the real dispute” – then becomes whether the word “other” in the text “other structures or organs” only qualifies “structures” (as the estate argued) or also “organs” (as Allianz argued). It is best understood as qualifying both. The words “connects, supports or surrounds” identify the function played by the tissue in question with respect to something else. The something else is identified by the following words: “other structures or organs of the body”. The word “other” distinguishes the tissue in question from the something else. In so doing, it also recognises that the something else – the structures or organs – may itself be tissue. It thus naturally applies to both notions. Moreover, the structures in question are structures of the body. So, too, are the organs. Thus the set of words “other structures or organs of the body” must be read together, again indicating that the word “other” qualifies both structures and organs.

34. This understanding of the statutory words renders the estate’s argument unsustainable. If the definition is understood to mean tissue performing certain functions with respect to other structures or other organs, then it is clear that both the structures and the organs referred to may themselves be tissue. The natural reading of the text then is that organs are capable of being soft tissue within the meaning of the definition, subject to consideration of the “connects, supports or surrounds” limitation. Most organs are excluded not because they cannot be soft tissue per se, but because they fall outside that functional requirement (see above at [27]).

35. As for the nature of those functional words, in a broad sense many parts of the body “connect” other structures or organs. All parts of the body are connected in one way or another to other parts. Some tissue will surround other structures or organs. And much tissue plays a role in supporting other structures or organs in a biological sense. Yet a broad understanding of these concepts tends to undermine any significance they would have in delimiting what types of tissue are identified as soft tissue, thus defeating the very point of the words being deployed.

36. Those three functional words need not be read in that way. The words “connects” and “surrounds” are naturally best understood as denoting a physical relationship. The word “support” is less clear. It can mean “to maintain (a person … etc) by supplying with things necessary to existence; provide for” (Macquarie Dictionary). The term may also have a more restrictive meaning of a physical kind: “to bear or hold up (a load, mass, structure, part, etc)”, and “to sustain or withstand (weight, etc) without giving way” (ibid). The heart and the brain provide support to all other parts of the body in the first type of sense but not in the second. The use of the three words “connects, supports or surrounds” together tends to suggest a physical focus.

37. Moreover, given a choice between reading the words “connects, supports or surrounds” as playing a significant or an insignificant role in the definition, the answer is clear. It is those words which have the central role to play in delineating the types of tissue encompassed by the provision. That work is not done by the words in brackets, let alone by the exclusions. As Allianz pointed out, the types of tissue identified in brackets in the definition are examples which may be soft tissue; they are not necessarily soft tissue. The examples include “muscles”. Yet the heart can be described as a muscle, and there is no dispute it is not encompassed by the definition. The same might be said of the tongue. The examples thus throw some, but limited, light on the sorts of body components meant to be included in the definition. Nor do the exclusions at the end of the definition – an injury to nerves or a complete or partial rupture of tendons, ligaments, menisci or cartilage – throw significant light on the issue.

38. Thus the words “connects, supports or surrounds” can and should be read as identifying a physical function. Of course human tissue is always adjacent to other tissue, thus any tissue component is likely to play some role in physically connecting, supporting or surrounding other tissue. It was for that reason that Allianz initially argued that the words should be understood as referring to the dominant or primary function of the tissue in question. In the course of argument this position evolved, as Allianz accepted that “lots of tissues have multiple functions”. Its position ended up being, in effect, that connecting, supporting or surrounding other structures or organs in a physical sense should be a significant and characteristic feature of the tissue in question, that is, sufficient to warrant that tissue being characterised as having that physical function. That understanding should be accepted.

39. The contrary textual considerations identified by the estate and the primary judge do not suffice to outweigh the force of these considerations. The estate argued that Allianz’s construction involved reading the words “connects, supports or surrounds” conjunctively rather than disjunctively. That is not so. On the text, tissue can be soft tissue if its function is to connect, support or surround other structures or organs in a physical sense.

40. One point that does favour the estate’s construction is that on its face it appears to have the virtue of relative simplicity and certainty. As senior counsel for Allianz accepted, there is a general understanding as to what is on the list of human organs – saying that “the number of organs which is widely recognised is 78” – even if there may be some room for argument at the borders (certain types of muscle are included in common lists of organs, which could create some possible tension with the words in bracket in the definition in s 1.6(2) on the estate’s construction, but it is not necessary to consider that point further). In contrast, the construction put by Allianz may require an evaluative judgment of a medical nature as to the physical function of some human tissue. That being said, the judgment does not appear likely to be difficult in most cases, especially once the issue is expressed in terms of a significant and characteristic feature rather than assessing what is a dominant or primary function. As already noted, in practice most human organs will generally have some distinct, specific and readily identifiable function, and any role they play in acting to connect, support or surround other structures or organs in a physical sense is unlikely to be a sufficiently significant feature as to warrant bearing that characterisation.

41. The most important consideration in the primary judge’s view was that skin was not specifically mentioned in the inclusions in the brackets in the definition. Given “the frequency with which skin injuries figure in motor accident claims”, his Honour suggested that if skin had been meant to be included then it could readily have been included in that list (quotation from J [51]; see generally [50]-[57]). Yet it could equally be said that skin could readily have been included in the exclusions at the end of the definition if the Parliament had meant not to include this common type of injury. Moreover, as explained, the inclusionary list in the brackets does not identify types of tissue which are necessarily soft tissue, but rather the sorts of tissue that can be. The list is also expressed in non-exhaustive terms: “such as muscles …”. In my respectful view the set of examples in brackets does not have the significance attributed to it by his Honour.

42. His Honour further reasoned that “the common trait or theme of the parenthesised examples (ie, muscles, tendons, ligaments etc) is that each is a connective tissue which has a unique and important role to play in orthopaedic injuries” (J [58], see also [60]). Allianz submitted that one thing that the definition of soft tissue certainly does not involve is bones and the skeletal system. The estate did not seek to defend this aspect of his Honour’s reasons.

43. The primary judge suggested that the fact that the definition of “soft tissue injury” in s 1.6(2) commences with the qualification “subject to this section” gave potential significance to the Regulations and Guidelines in construing the meaning of “soft tissue injury” (J [62]). Whether or not those sources have contextual relevance is discussed below. Section 1.6(4) provides that the regulations may include or exclude a specified injury as a threshold injury. Section 1.6(5) states that the Guidelines “may make provision for or with respect to the assessment of whether an injury is a threshold injury for the purposes of this Act”. As to the latter, it is only directed to how injuries are to be assessed; the Guidelines are not authorised to identify what injuries are or are not threshold injuries. As to the former, that the Government of the day is authorised to add or subtract from what is included in the definition says nothing as to what the definition should be understood to mean.

44. The textual considerations identified by the primary judge thus do not outweigh those considerations indicating that the definition in s 1.6(2) should be understood as identifying soft tissue as tissue a significant and characteristic feature of which is connecting, supporting or surrounding other structures or organs in a physical sense, such as to warrant that tissue being characterised as having that function. The question then is whether purposive or contextual considerations lead to a different conclusion.

Context and purpose

45. Seven main issues were raised on this front.

46. First, the primary judge considered that “a construction of the definition as a whole which views it as applying to orthopaedic or musculoskeletal injuries” gains some support from surrounding contextual material (citation omitted):

[61] For what it is worth, it might also be noted, as a matter of context, that this view gains further support from the Motor Accident Injuries Regulation 2017 (NSW) (Regulations) and the Motor Accident Guidelines (Guidelines) which, as the Review Panel noted at [51], “focus on the clinical features of injury to these qualifying connective tissues typical of musculoskeletal injuries, e.g. injury to spinal nerve root as determined by the presence of radicular signs or radiculopathy”. … The Regulations and Guidelines form part of an overall scheme, together with the Act, which can cast some light on the proper construction of the definition of “soft tissue injury”.

47. I respectfully disagree that either the Regulations or the Guidelines can be taken into account in construing s 1.6(2) of the Act. In what follows on this point I substantially repeat the analysis in White v Commissioner of Police [2024] NSWSC 219; (2024) 329 IR 323 at [101]-[104]. In general it is impermissible to construe an Act using delegated legislation made under that Act: eg Great Fingall Consolidated Ltd v Sheehan (1905) 3 CLR 176 at 184; [1905] HCA 43. In Elazac Pty Ltd v Commissioner of Patents (1994) 53 FCR 86, at 90, Heerey J quoted and applied a statement by Lord Lowry that regulations can be used as an aid in construction of the parent Act where the Act “provides a framework built on contemporaneously prepared regulations”. Similarly, it has been suggested that subordinate legislation can “assist in properly construing any ambiguity in an Act when the subordinate legislation has been promulgated at the same time as the Act and forms part of a statutory scheme”: PIPE Networks Pty Ltd v Commonwealth Superannuation Corporation (2013) 212 FCR 542; [2013] FCA 444 at [93] (Tracey J). However, there is some lack of clarity as to what contemporaneous means in this context, and there are some conflicting views on the issue as a whole: note DC Pearce, Statutory Interpretation in Australia (LexisNexis, 10th edn, 2024) at [3.57]; cf P Herzfeld and T Prince, Interpretation (Lawbook, 3rd edn, 2024) at [8.390].

48. In Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1; [2012] HCA 46, at [56], French CJ said (citation omitted):

Generally speaking an Act, which does not provide for its own modification by operation of regulations made under it, is not to be construed by reference to those regulations. That would be a case of the tail wagging the dog. That general principle does not exclude the possibility that a regulatory scheme proposed and explained at the time that Parliament enacted the Act under which the scheme was to be made could constitute material relevant to determination of the statutory purpose.

49. Thus his Honour suggested that the draft regulations would need to have been in the contemplation of the Parliament when the Act was passed to be a relevant aid. In the same case Heydon J arguably took a broader view (at [324]).

50. I respectfully agree with French CJ. Employing regulations to construe the Act is in effect to use them as an extrinsic source. It is notable that all of the extrinsic material identified in s 34(2) of the Interpretation Act 1987 (NSW) as permissible aids to interpretation must, in one way or another, have been available to at least one of the Houses of Parliament when the legislation in question was being enacted. In this context, I do not see how delegated legislation or a statutory guideline which did not exist when the statute was being enacted, and the relevant content of which was not otherwise foreshadowed to the Parliament, can properly be regarded as throwing light on Parliament’s intentions.

51. Here, there is no suggestion that either the Regulation or Guideline was drafted prior to enactment of the Act in 2017, let alone made available to the Parliament when the Act was being enacted. Neither ministerial second reading speech in either chamber suggested that those documents existed at that time. Nor is there such a suggestion in the explanatory note for the bill. The fact that they were in place when the heading to the section was changed in 2022 is of no great significance given the very minor nature of the change then made. The same may be said of minor changes made to the section in 2020 consequent upon the creation of the Personal Injury Commission. In my respectful view the primary judge erred in taking them into account in construing the definition in s 1.6 of the Act.

49. Second, Allianz gave much emphasis in its submissions to a floodgates argument. It said:

The primary judge’s construction of s 1.6(2) has the effect in practice of reading the provision out of existence. Common experience indicates that in almost every case where there is a soft tissue injury such as would fit within the primary judge’s narrowed definition, there would also be some cut, scratch or bruise, all of which are injuries to the skin. The ease with which that could be asserted by claimants and the difficulty of contradiction would tend to make this an inevitability. All of those cases would then be cases where the injured person has suffered a non-threshold injury, and all of those claimants (who were plainly intended to be caught by the soft tissue injury definition) would be entitled to extended statutory benefits and damages. This is not just an anomaly (as the primary judge suggested), but rather, it would render the entire provision practically inoperative.

53. The argument is unpersuasive. It depends on a factual premise that in almost every car accident there will be a skin injury. That proposition was asserted from the bar table, and reference was made to skin abrasions caused by airbags. Bruising was also referred to, caused for example by a seatbelt. But in the end Allianz declined to suggest that bruising would necessarily constitute a skin injury.

54. It can readily be accepted that skin injuries may be a frequent occurrence in motor accidents. That does not mean that they are an invariable consequence. Allianz pointed to no evidence in support of its claim other than identifying two recent decisions of the Personal Injury Commission which had involved skin injuries. That says little about the thousands of motor vehicle accidents occurring in this State every year. Not only did Allianz point to no other evidence, some material it provided to the Court undermined its argument. The State Insurance Regulatory Authority published in 2020 a document entitled “Review of Minor Injury Definition in the NSW CTP Scheme” (SIRA Report). That document refers to an earlier report by the John Walsh Centre for Rehabilitation Research. The SIRA Report said the following (at p 31):

In its report, the John Walsh Centre for Rehabilitation Research … found that 19% of the claims it reviewed included a skin type injury. There were both minor and non-minor skin injuries among this sample:

Bruising, abrasion, haematoma, superficial injury (16%)

Minor Injury: 37

Non-Minor Injury: 22

Laceration, cut, open wound (3%) [In the report this point was formatted as a dot point, seemingly erroneously]

Minor Injury: 3

Non-Minor Injury: 7

This indicates that the minor injury provisions do not prevent differentiating between minor and non-minor injury claims involving skin injuries. Also, the minor injury definition adequately deals with skin and scarring injuries. The number of disputes involving skin and scarring as an issue is low (less than 10). In practice, skin and scarring issues are not presenting a significant issue for the scheme at this stage. Nonetheless, SIRA will continue monitoring claims with skin injuries, disputes that relate to skin injuries and whether additional guidance is required at a later stage.

55. Thus such evidence as there was before the Court suggested that only in 19% of cases was there a “skin type injury”. Allianz suggested that that rate would go up if the primary judge’s construction prevailed. That might be right, but that possibility does not come close to establishing that skin injuries will invariably occur such as to render the threshold injury test “abortive”, as Allianz asserted.

56. Courts are not limited by the rules of evidence in relation to “legislative facts” which assist to construe, and consider the validity of, legislation: see eg Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460; [2002] HCA 9 at [62]-[70] (McHugh J); Maloney v The Queen (2013) 252 CLR 168; [2013] HCA 28 at [351]-[353] (Gageler J). Thus the High Court may receive and consider materials going to such facts even though it is unable to receive further evidence on appeal: note Eastman v The Queen (2000) 203 CLR 1; [2000] HCA 29. In Woods McHugh J referred to data from the Australian Bureau of Statistics. As noted, here such data as the Court has to hand is contrary to Allianz’s claim. Sources for legislative facts can include “statements made at the bar and from general knowledge and experience of Australian affairs”, that is, matters falling within the bounds of judicial notice: Wilcox Mofflin Ltd v New South Wales (1952) 85 CLR 488 at 507; [1952] HCA 17 (Dixon, McTiernan and Fullagar JJ); see also Woods at [66]; Maloney at [353]. But, obviously enough, that does not mean that a court is bound to accept any factual claim made from the bar table. The “ultimate criterion governing the use of information from any source is that a court is able to consider the material sufficiently probative of the legislative fact to be found”: Maloney at [353].

57. Here Allianz’s factual claim cannot be said to be beyond reasonable question, indeed it is contrary to such evidence as is before the Court. I do not accept it. The floodgates argument made by Allianz is not made out.

58. Third, Allianz emphasised that s 1.3 of the Act sets out its objects, and these include the following in s 1.3(2)(d) (emphasis added):

to keep premiums for third-party policies affordable by ensuring that profits achieved by insurers do not exceed the amount that is sufficient to underwrite the relevant risk and by limiting benefits payable for soft tissue injuries and psychological or psychiatric injuries that are not recognised psychiatric illnesses.

59. The difficulty with the submission is that an acceptance of the significance of this object says nothing as to how the definition of soft tissue injuries should be construed. If the suggestion is that this object requires that the definition must be read in an expansive way so as to increase the reach of the limiting effect of the definition then I disagree. As the primary judge said:

[68] … Why approach the task of statutory construction here by reference to that particular object and not by reference to other competing objects, such as those stated in ss 1.3(2)(a) and (b) (ie, encouraging early and appropriate treatment and care to achieve optimum recovery and providing early and ongoing financial support for injured persons)? As has been repeatedly emphasised, a purposive approach is of limited value in a particular statutory framework which has competing objects and purposes.

60. Conversely, for much the same reason I would also reject the opposite view taken by the review panel in this matter (at RP [47(a)]) to the effect that because it considered the Act “beneficial legislation” an “exacting” approach should be taken to the construction of s 1.6(2): note ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1; [2014] HCA 18 at [29].

61. Allianz’s argument on this point in the end seemed to depend upon saying that were the primary judge’s construction accepted then the object in s 1.3(2)(d) would be defeated because the limiting effect of the soft tissue definition would be rendered abortive. Thus the third argument converged with the second, which I have already rejected.

62. Fourth, Allianz said that the SIRA Report supported its construction, and asserted that that view had implicitly been accepted by the Parliament when it made the very minor change to the label applied in s 1.6 in 2022. The latter proposition is not without difficulties (see J [82]) but it is not necessary to address it. The minor premise is not made out. As the estate argued, the points on p 31 of the SIRA Report referred to by Allianz “aren’t really an explanation as to how it works, as much as a regurgitation of the statutory formula”. After those points the Report said:

SIRA will continue to monitor skin and scarring injuries and promote application of the minor injury provisions consistent with the above. SIRA will consider further guidance where appropriate to address concerns or confusion around skin and scarring injuries.

63. Neither there nor anywhere else did it address whether and why injury to skin was or was not a “minor injury”. It may be that the Allianz-type construction was implicit in its discussion but it cannot be said to have been pellucidly clear.

64. Fifth, senior counsel for the estate asserted that the context in which the soft tissue aspect of the Act was introduced was a concern about “claim farming practices” whereby lawyers encourage injured persons with a soft tissue whiplash injury to pursue compensation claims. That assertion might be right, although no material supporting the contention was identified. Even if it explains the motivation for introducing the minor/threshold injuries element, it does little to advance debate on the issue of construction presented by the words employed in the definition in s 1.6(2).

65. Sixth, the estate sought to argue that Allianz’s construction created some uncertainty with respect to injuries to nerve damage, which uncertainty was unlikely to have been intended. It was responding to this argument of Allianz (citations omitted):

the fact that injury to skin is included in the definition does not lead to [the] outcome that severe injuries such as deep lacerations will always be no more than soft tissue injuries. That is because of the exclusion at the end of s 1.6(2) of “an injury to nerves”. It will be a question of fact in each case as to whether the severity of the skin injury is such that the skin’s nerve supply has been injured ...

66. These points made by Allianz can be accepted. They are a consequence of accepting its construction. Significant skin injuries – caused by burns or road rash for instance – may well fall outside the definition of soft tissue injuries because they involve “an injury to nerves”.

67. On that basis senior counsel for the estate argued that “you will have a much greater degree of disputation and uncertainty if you’re having to look at every laceration”, asking rhetorically whether “[i]f it takes a millimetre off the end of a nerve ending has there now been injury to a nerve?”. There is some force in these arguments. Ultimately, however, the fact that assessing whether there has been an injury to nerves creates some uncertainty is simply a consequence of the statutory choice to enact that exclusion. These are matters capable of medical assessment, as illustrated by the review panel’s discussion in Dhupar at [130]-[132].

68. Seventh, there was some reference in argument to anomalies in the operation of the definition. Notably, “injury” is defined in s 1.4(1) of the Act to include “damage to artificial members, eyes or teeth, crutches or other aids or spectacle glasses”. A chipped tooth or some damaged glasses would suffice to establish an injury that was not a threshold injury. However, as the primary judge explained:

[70] As the [estate] correctly pointed out, the Act contains many anomalous policy outcomes, including the fact that the definition of “injury” in s 1.4 includes “damage to artificial members, eyes or teeth, crutches or other aids or spectacle glasses”. I accept [Allianz’s] submission that this anomaly should not be allowed to inform the proper construction of s 1.6(2). The anomaly relates to the fact that this part of the definition of “injury” long pre-dates the concept of “threshold injury”. It can be traced back to the definition of “bodily injury” in the Motor Vehicles (Third Party Insurance) Act 1942 (NSW), which was substantially repeated in subsequent iterations. It appears to have been retained in the present Act to provide continuity.

69. There are some odd and anomalous effects of the definitions of the Act whichever way the definition at issue is construed. As senior counsel for the estate colourfully put it, “[t]he idea that your crutch in the boot of the car being injured could somehow qualify you inside the car for a claim for statutory benefits and damages is embarrassing”. The existence of such anomalies does not assist in construing that definition. Neither construction put by the parties here itself leads to odd or anomalous results. As Allianz argued, that the “threshold injuries” filter does not exclude all minor injuries does not undermine its role in filtering a significant proportion of such injuries.

70. In sum, none of the purposive and contextual arguments raised by the primary judge or the parties do much to assist to resolve the construction issue. The rejection of the arguments put by Allianz on this front does not support the estate’s argument; it merely removes from consideration further points Allianz sought to rely on. The issue falls to be determined by the textual considerations identified above which, as explained, support the construction put by Allianz.

71. Thus the definition in s 1.6(2) should be understood as identifying soft tissue as tissue a significant and characteristic feature of which is connecting, supporting or surrounding other structures or organs in a physical sense, such as to warrant that tissue being characterised as having that function. That is not likely to include most organs. Whether or not it includes skin is a matter to which I now turn.

Two consequential issues of fact

72. A factual issue arises as to whether a significant and characteristic function of skin is to connect, support or surround other structures or organs. As the review panel noted in this matter, skin serves a number of functions (RP [62]-[63]). In that context, senior counsel for the estate was asked whether he considered the issue sufficiently disputable that the matter should be remitted to the review panel for a determination on this issue. In the end he did not seek remittal on the point. He indicated that if the Court accepted Allianz’s construction then skin should be characterised as soft tissue within the meaning of s 1.6(2): see, to the same effect, Dhupar at [111]-[129].

73. The estate raised a further factual matter, submitting that “neither Assessor Home nor the review panel considered whether the nature and extent of the scarring that the late Ms Abawi experienced may have involved any injury to nerve endings”. On that basis it did assert that the matter should be remitted to the review panel if the appeal was to be upheld. The assessor and the panel had to rely on medical records, rather than an examination, of Ms Abawi. The assessor concluded that “[t]here is no evidence of injuries to the nerves” in either wrist. He also found that the lacerations to the left wrist were not caused by the motor accident – a finding with which the review panel disagreed. Regardless of that issue, the assessor did not dispute that Ms Abawi did have lacerations to her left wrist; his finding related to how they were caused. There is no reason to doubt his conclusion as to the absence of evidence of nerve damage. The review panel did not suggest to the contrary.

74. There thus is no reason for the matter to be remitted to the review panel.

Conclusion and orders

75. Allianz succeeds on its statutory construction argument and the appeal should be upheld. As a consequence the review panel’s decision overturning Assessor Home’s decision was in error based, as it was, on the construction put by the estate. That decision must itself be overturned and Assessor Home’s conclusion reinstated. As noted, Allianz appropriately agreed to pay the estate’s costs both in this Court and the court below as a condition of obtaining leave to appeal.

76. An issue arises as to the naming of parties. The second respondent was named below, and in Allianz’s summons seeking leave to appeal, by identifying the members of the review panel. Allianz submitted that that was inappropriate and contrary to authority, according to which the reference should be made to the review panel itself: see, eg, Cheers v Mid Coast Council [2024] NSWSC 1553 at [85]-[86]. The estate agreed. An order should be made accordingly.

77. The orders of the Court should be as follows:

1. The second respondent is to be identified as the Personal Injury Commission Review Panel in lieu of the names of the members constituting the panel.

2. Leave to appeal is granted.

3. Appeal allowed.

4. Set aside so much of the order made by Griffiths AJA on 4 October 2024 as dismissed the summons filed on 4 June 2024 and in lieu thereof order:

1. The decision of the second defendant made on 15 March 2024 is set aside.

2. In place of that decision, the Certificate of Assessor Home dated 5 October 2022 is confirmed.

5. The appellant is to pay the first respondent’s costs of the appeal.

78. ADAMSON JA: I have had the benefit of reading the reasons of Kirk JA in draft with which I substantially agree.

79. I consider the textual considerations referred to by Kirk JA in [31]-[38], which Mr Herzfeld SC, who appeared for the appellant with Ms Gumbert, advanced on behalf of the appellant, to be compelling. The consequence of this Court’s acceptance of the construction for which the appellant contended is that the appeal ought be allowed and the ancillary orders sought by the appellant ought be made. For the reasons given by Kirk JA at [72]-[74], there is no need for the matter to be remitted to the review panel. I agree with his Honour’s conclusions and proposed orders at [75]-[77].

80. STERN JA: I agree with Kirk JA.

**********

Decision last updated: 02 May 2025