Chih v AAI Limited t/as AAMI - [2025] NSWPICMR 9

CERTIFICATE OF DETERMINATION OF MERIT REVIEWER
CITATION:	Chih v AAI Limited t/as AAMI [2025] NSWPICMR 9
CLAIMANT:	Cheng-Hsueh Chih
INSURER:	AAI Limited t/as AAMI
MERIT REVIEWER:	Elizabeth Medland
DATE OF DECISION:	17 March 2025
CATCHWORDS:	MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; application to set aside insurer’s decision regarding payment of legal costs in respect of a medical assessment; claimant submitted that the insurer had no statutory right to assert that payment of costs should be anything less than the maximum regulated fee of 16 monetary units; Held – the “maximum” regulated legal costs for a medical dispute does not represent the mandatory amount recoverable for legal costs; section 8.10 specifies an entitlement to “reasonable and necessary” legal costs; determined on the evidence that reasonable and necessary legal costs total $600 plus GST.
DETERMINATIONS MADE:	CERTIFICATE 1. The reviewable decision is set aside. 2. The amount of the claimant’s costs assessed in accordance with the Motor Accident Injuries Act 2017 is $600 plus GST.

STATEMENT OF REASONS

INTRODUCTION

The subject dispute relates to a claim for legal costs arising from an application lodged with the Personal Injury Commission (Commission) for assessment of a dispute as to whether the injuries caused by the motor accident are threshold injury for the purposes of the Motor Accident Injuries Act2017 (MAI Act).
That dispute proceeded to assessment as a medical assessment matter. Following the determination, the claimant’s legal representatives forwarded a tax invoice dated

19 September 2024 to AAI Limited t/as AAMI (the insurer) for 16 monetary units ($2,111.30 inclusive of GST) and disbursements.
The legal representatives of the insurer forwarded a letter dated 14 November 2024 rejected payment of the legal fees and instead applied their own assessment of legal costs, being a proposal of 8 monetary units, in the sum of $956.68.
I held a teleconference with the parties on 11 February 2025 wherein both parties confirmed that no further information/documentation is to be relied upon and it was appropriate that I determine the matter on the papers.

LEGISLATIVE FRAMEWORK

The dispute that gives rise to the claim for legal costs is a medical assessment matter under Schedule 2(2)(e) of the MAI Act.
The dispute is deemed a merit review matter under Schedule 2(1)(aa) of the MAI Act which specifies the dispute to encompass “whether for the purposes of section 8.10 (Recovery of costs and expenses in relation to claims for statutory benefits) the costs and expenses incurred by the claimant are reasonable and necessary.”
Section 8.10 of the MAI Act provides relevantly as follows:
“(1) A claimant for statutory benefits is (subject to this section) entitled to recover from the insurer against whom the claim is made the reasonable and necessary legal costs, and other costs and expenses, incurred by the claimant in connection with the claim. Other costs and expenses include the cost of medical and other tests and reports.
(2) The regulations may make provision for or with respect to fixing the maximum costs and expenses…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2025] NSWPICMR 9
Decision Date: 17 March 2025

CaseChat Overview and Summary

The case of Chih v AAI Limited t/as AAMI involved a dispute concerning the payment of legal costs in relation to a motor accident injury. The claimant sought to challenge a decision by the insurer, AAMI, regarding the amount of legal costs to be paid for a medical assessment. The case was heard in the relevant court where the claimant argued that AAMI was not entitled to set an amount lower than the maximum regulated fee of 16 monetary units.

The primary legal issue before the court was whether the statutory maximum regulated fee for legal costs in a medical dispute under the Motor Accident Injuries Act 2017 represented the mandatory amount recoverable, or whether the insurer could determine a lower amount based on what it deemed "reasonable and necessary." The claimant maintained that the statutory maximum was the minimum allowable, while AAMI argued for the application of a lesser amount.

The court examined the relevant statutory provisions and concluded that the "maximum" regulated legal costs do not signify the mandatory amount recoverable for legal costs. Rather, the court determined that section 8.10 of the Motor Accident Injuries Act 2017 provides an entitlement to "reasonable and necessary" legal costs. Based on the evidence presented, the court found that the reasonable and necessary legal costs amounted to $600 plus GST. This decision clarified the scope of the insurer's discretion in determining the amount of legal costs payable for a medical assessment under the Act.

Orders