Daly v Thiering

[2013] NSWCA 25

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Daly v Thiering [2013] NSWCA 25

Hearing dates:

30 January 2013

Decision date:

20 February 2013

Before:

McColl JA at [1]
Macfarlan JA at [2]
Hoeben JA at [3]

Decision:

Leave to appeal is granted.

The appeal is dismissed.

The applicant to pay the first and second respondents' costs of the appeal.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

Catchwords:

STATUTORY INTERPRETATION - interpretation of statute determined as a separate question - Motor Accidents (Lifetime Care and Support) Act 2006 and Motor Accidents Compensation Act 1999 - whether participant in Lifetime Care and Support Scheme entitled to damages pursuant to s 128 Motor Accidents Compensation Act 1999 - whether Lifetime Care and Support Authority or motor vehicle tortfeasor/CTP insurer liable to pay for attendant care services provided gratuitously pursuant to s 128 Motor Accidents Compensation Act 1999 - motor vehicle tortfeasor/CTP insurer remains liable to make such payments in certain circumstances - liability of Lifetime Care and Support Authority to make payments to person providing gratuitous attendant care to participant in scheme - possible limitations on such an obligation - question of fact as to whether Lifetime Care and Support Authority has such an obligation.

Legislation Cited:

Motor Accidents Compensation Act 1999
Motor Accidents (Lifetime Care and Support) Act 2006
Motor Accidents Lifetime Care and Support Schemes Legislation Amendment Act 2012

Cases Cited:

Griffiths v Kerkemeyer [1997] HCA 45; 139 CLR 161
Thiering & v Daly & [2011] NSWSC 1345
Thiering v Daly (No 2) [2011] NSWSC 1585

Texts Cited:

Mason & Carter's Restitution Law in Australia, 2nd ed, LexisNexis Butterworths: Sydney (2008), p 824

Category:

Principal judgment

Parties:

John Daly - Applicant
Alexander Thiering - First Respondent
Rose Matilda Thiering - Second Respondent
Lifetime Care and Support Authority of NSW - Third Respondent

Representation:

Counsel:
Mr KP Rewell SC/Mr DM Wilson/Ms J Gumbert - Applicant
Mr EG Romaniuk/Ms EE Grotte - First and Second Respondents
Submitting Appearance - Third Respondent
Solicitors:
Moray & Agnew - Applicant
Slater & Gordon - First and Second Respondents
WorkCover Legal Group - Submitting Appearance - Third Respondent

File Number(s):

2012/68384

 Decision under appeal 

Citation:

Thiering v Daly & [2011] NSWSC 1345
Thiering v Daly (No 2) [2011] NSWSC 1585

Before:

Garling J

File Number(s):

2010/22260

Judgment

1. McCOLL JA: I agree with Hoeben JA's reasons and the orders his Honour proposes.

1. MACFARLAN JA: I agree with Hoeben JA.

1. HOEBEN JA:

Nature of appeal

The first respondent, Alexander Thiering, has brought proceedings in the Supreme Court against two defendants for damages arising from catastrophic injuries suffered by him in a motor vehicle accident on 28 October 2007. The applicant, John Daly, was the driver of the motor vehicle alleged to have been at fault in the motor vehicle accident and is the first defendant in those proceedings.

1. The second respondent is the first respondent's mother, who has provided and continues to provide attendant care services to him. She is the second plaintiff in those Supreme Court proceedings and seeks payment from the third respondent, the Lifetime Care and Support Authority of NSW (LCSA), for the provision of those attendant care services.

1. The first respondent is a lifetime participant in the scheme established under the Motor Accidents (Lifetime Care and Support) Act 2006 (the LCS Act) which is administered by the LCSA.

1. The primary judge was asked to consider and determine five questions separately and in advance of all other issues in the Supreme Court proceedings. His Honour provided answers to those questions in his judgments of 11 November and 19 December 2011. The applicant seeks leave to appeal from those findings by the primary judge. The application for leave to appeal and the appeal were heard together.

Factual background

1. The first respondent was injured on 28 October 2007 while riding a registered motorcycle. The applicant was driving a registered motor vehicle out of a driveway and made a right turn across the path of the first respondent's motorcycle. A collision occurred in which the first respondent suffered spinal cord injuries at the C5 and C6/7 levels. The first respondent is now a quadriplegic being paralysed in the upper and lower limbs and trunk with only elbow flexion, shoulder and neck movements possible.

1. In his defence, the applicant admitted that he was negligent but alleged that the first respondent was guilty of contributory negligence in a number of specified ways.

1. Before the commencement of the LCS Act, damages in respect of the first respondent's treatment and care needs were recoverable under the Motor Accidents Compensation Act 1999 (MAC Act). In order to be eligible for such damages, an injured plaintiff had to establish negligence.

1. The enactment of the LCS Act created new rights for persons catastrophically injured. The broad aim of the scheme was to provide for the lifetime care and support needs of those who had suffered traumatic spinal cord injury (such as paraplegics and quadriplegics) and those who had suffered severe traumatic brain injury.

1. The LCS Act created the LCSA to administer the scheme. The LCSA is part of a division of the New South Wales Government known as the Compensation Authorities Staff Division which since 2009 has been a principal agency of government. The Motor Accidents Authority (MAA), which licenses and regulates CTP insurers, is also a part of the Compensation Authorities Staff Division. Both the MAA and the LCSA share a single chief executive officer and the two authorities report to a single minister of government, i.e. the Minister for Finance and Services.

1. Ostensibly the LCS scheme would appear to be voluntary in nature. A claimant has the opportunity to elect to participate in the scheme (s 8(1)). Similarly, an insurer may nominate a claimant for participation in the scheme. The MAA or the LCSA can also direct an insurer to nominate a claimant to participate in the scheme. The reality is that insurers will nominate all possible eligible claimants for participation in the scheme. This is because it is in an insurer's financial interest to pass on liability for ongoing treatment and care to the LCSA, rather than the insurer having to continue to meet such expenses.

1. A claimant cannot resist an insurer's decision to nominate him or her for participation in the scheme except on grounds that they do not meet the eligibility criteria (s 8(2)). Eligibility for the scheme applies irrespective of fault. The only legal impediment to eligibility is where there is a dispute as to whether the injury arose from a motor accident as relevantly defined in the MAC Act.

1. The LCS Act provides that the claimant will not be eligible to participate in the scheme if he or she has been awarded common law damages for their treatment and care needs (MAC Act - s 7(3)). A claimant who can establish fault (whether discounted for contributory negligence or not) preserves the right to recover all other heads of damage that are not covered by the scheme, i.e. such a claimant can still recover a lump sum for general damages and damages for economic loss.

1. The following facts were agreed before the primary judge.

"1. The first plaintiff was born on 18 August 1978 and was involved in a motor accident on 28 October 2007. As a result of the motor accident the first plaintiff suffered catastrophic injuries rendering him a high level quadriplegic.

2. The second plaintiff is the first plaintiff's mother ('mother').

3. The first plaintiff is a lifetime participant in the scheme established by the Motor Accidents (Lifetime Care and Support) Act 2006 ('the LCS Act'). He was provisionally accepted into the scheme on 6 December 2007 as an interim participant and subsequently was accepted as a lifetime participant

4. At all material times Guidelines were in force under the LCS Act, relevantly the Lifetime Care and Support Guidelines gazetted 8 October 2011 and as amended.

5. The first plaintiff was admitted to the Prince of Wales Hospital on the day of the accident and was discharged on 29 September 2008 to reside at 37 Bundanoon Road, Woronora Heights, NSW.

6. While the first plaintiff was hospitalised his mother visited him in hospital.

7. Since his discharge from hospital the first plaintiff has lived in rented accommodation with his mother at Woronora Heights. His father resided there for a time but not longer lives at that address.

8. Since becoming a scheme participant, the LCS Authority has provided and paid for the first plaintiff to receive attendant care and domestic assistance from commercial providers, medical and nursing treatment, equipment and other items needed by reason of his injury. The first plaintiff's current (paid) attendant care provider is Australian Homecare Services Pty Limited.

9. Since his discharge from hospital, the mother has provided care and domestic assistance to the first plaintiff on a gratuitous basis. The first plaintiff and the second plaintiff have not negotiated any agreement in respect of the terms and conditions for payment of monies to the second plaintiff in respect of the provision of services to the first plaintiff by the second plaintiff.

10. The LCS Authority has declined to pay the mother as an attendant carer. The mother is in receipt of a carer's allowance from the Commonwealth Government for the care and assistance that she provides to the first plaintiff.

14. The first plaintiff has commenced proceedings No 2010/00022260 in the Supreme Court of New South Wales Common Law Division against the motor vehicle driver and the LCS Authority. By his Further Amended Statement of Claim the first defendant claims damages for negligence from the driver as the first defendant. The first defendant by his Defence filed 23 April 2010 admits breach of duty and alleges contributory negligence. The first defendant also relies on section 130A of the Motor Accidents Compensation Act 1999 (NSW).

15. By the Further Amended Statement of Claim the first plaintiff and the mother claim that the LCS Authority has a statutory obligation to pay for the mother's services to him 'in the order of' 106 hours per week and makes allegations of invalidity concerning Part 8 of the Guidelines made under the Act. The LCS Authority denies that it has an obligation as alleged and relies in particular on sections 6 and 10 of the Act and the Guidelines made under it. The LCS Authority also denies that the mother has locus standi .

16. The mother has also commenced proceedings [n]o 2010/351580 in the Supreme Court of New South Wales against the motor vehicle driver alleging psychological impairment, nervous shock and incapacity for work, and has submitted numerous expert and medical reports in support of her claim. Those proceedings will be heard together with the negligence proceedings." (WB 37)

1. Examples of "care plans" prepared by the LCSA in respect of the first respondent were placed before the Court. These care plans were dated respectively 18 April 2008, 7 April and 22 December 2009. Each care plan set out a regime of paid and unpaid care. For example, that prepared on 22 December 2009 provided for a total of 182 hours of care per week, comprising 152 hours of paid care and 30 hours of unpaid care to be provided by the second respondent. Those "care plans" were made available to the first and second respondents.

1. The principal issue which arose before the primary judge and to which the separate questions were directed was from which of the applicant or the third respondent, if either, the value of the gratuitous attendant care services provided by the second respondent to the first respondent could be recovered.

1. It is for that reason that the first respondent brought proceedings against the third respondent for damages, including the value of care provided to him by the second respondent, and alternatively against the applicant by his CTP insurer, for damages under s 128 MAC Act for the value of that care. The second respondent brought proceedings against the third respondent for damages for the value of the care which she had provided for the first respondent on a basis not yet pleaded. Before the primary judge the basis identified was that of quantum meruit.

1. The preliminary questions raised before the primary judge were:

1. Does the LCSA have an obligation under the LCS Act to pay for gratuitous care and assistance provided by the second plaintiff (the mother) to the first plaintiff (the injured person) up to the date of judgment?

(a) Is the mother's care and assistance "expenses incurred by or on behalf of the injured person" within the meaning of s 6(1) of the Act?

(c) Do the Lifetime Care and Support Guidelines (Part 8) authorise the LCSA to decline payment of the mother on the basis that she is a family member and alternative care is available?

(d) Do the Guidelines (Part 8) authorise the LCSA to decline payment of the mother for:

(i) Care provided to or visiting the injured person while an inpatient in hospital?

(ii) Inactive sleep overs (after 8 October 2010)?

(e) Alternatively, to 1(d), are these "reasonable expenses" within the meaning of s 6 of the Act?

2. If there is an obligation to pay the mother, on what basis should an appropriate hourly rate be determined?

Second Plaintiff v Second Defendant

3. Does the mother have standing to bring and maintain these proceedings against the LCSA?

4. If so, issues 1 and 2 above also arise for determination in the mother's claim against the LCSA.

First Plaintiff v First Defendant

5. Whether on proper construction of s 130A of the MAC Act, the first plaintiff has any entitlement as against the first defendant other than damages for non-economic loss and loss of earning capacity? (WB 28)

1. His Honour answered the separate questions as follows:

"1. The LCSA may have an obligation under the LCS Act to pay for gratuitous care and assistance provided by Mrs Thiering to Mr Thiering up to the date of judgment, but only if it is established that the cost of the provision by Mrs Thiering of attendant care and assistance to Mr Thiering is an expense incurred by or on behalf of Mr Thiering within the meaning of s 6(1) of the LCS Act.

The provision of attendant care services by one person to another without charge and without either an accepted or else a determined legal liability to pay, does not constitute an "expense incurred by or on behalf of the injured person".

(a) Mrs Thiering's care and assistance is not an expense incurred by or on behalf of the injured person, within the meaning of s 6(1) of the LCS Act, unless or until it has been established by evidence that the LCSA has accepted a legal liability to pay Mrs Thiering or else it has been determined that a legal liability rests in the LCSA to pay Mrs Thiering.

(c) Not appropriate to answer.

(d)(i) Not appropriate to answer.

(d)(ii) To the extent that Part 8 of the Guidelines states as a policy that the LCSA will not fund family members or friends to provide inactive sleepovers, the Guideline is invalid, and therefore cannot alone authorise the LCSA to decline payment of a family member, including the second plaintiff.

(e) Any attendant care services can constitute "reasonable expenses" within the meaning of s 6 of the Act, provided that:

(a) they constitute part of the treatment and care needs determined by an assessment under s 23 of the LCS Act; and

(b) there exists a legal liability resting on the LCSA to pay for those services or else if the services have been paid for.

2. Inappropriate to answer.

3. Mrs Thiering has standing to bring a claim against the LCSA, including maintaining these proceedings. The strength of that claim, including her likelihood of success, has not been assessed.

4. If the second plaintiff, Mrs Thiering, establishes a legal liability resting in the LCSA, such as one in accordance with the principles of quantum meruit, to pay her for the attendant care services which she has provided, the LCSA would be obliged to pay Mrs Thiering for the fair and reasonable value of the attendant care services she has provided, where those attendant care services are included in an assessment of the reasonable treatment and care services of Mr Thiering produced in accordance with s 23 of the LCS Act. Mrs Thiering, in propounding such a claim, is not limited to the formula contained within s 128 of the MAC Act for the recovery of a reasonable value of her services.

5. Mr Thiering, as a participant in the LCS Scheme is entitled to recover from the first defendant, motor vehicle tortfeasor (or its CTP insurer) damages in accordance with s 128 of the MAC Act for the period from the accident to the date of judgment, or settlement, as the case may be, unless the LCS Scheme has incurred an expense under s 6(1) of the LCS Act with respect to the provision of such gratuitous attendant care services." (WB 83-85)

1. Although the answers provided by the primary judge and the issues raised in this application affect the third respondent, it filed a submitting appearance. It did not participate, either by way of written submission or otherwise, in the application for leave to appeal and the appeal.

1. The principal issue raised by the applicant relates to the answer given by the primary judge to question 5. On his behalf, the CTP insurer submitted that in providing that answer, his Honour erred in his construction of s 130A of the MAC Act and s 6(1) of the LCS Act when he concluded that the first respondent was entitled to recover from the applicant, or it, damages under s 128 of the MAC Act from the date of the accident to the date of judgment, or settlement of the damages claim.

1. As a result of the decision of the primary judge, the legislation relating to the LCS scheme was amended - the Motor Accidents Lifetime Care and Support Schemes Legislation Amendment Act 2012 (the Amendment Act). That act came into effect on 25 June 2012. The Amendment Act amended the LCS Act and the MAC Act. The effect of the Amendment Act was to make clear that CTP insurers have no liability for damages in respect of the treatment and care needs of participants in the LCS scheme, including care provided on a "gratuitous basis" (s 141A MAC Act which replaced s 130A).

1. The Court was advised that despite the Amendment Act, actuarial calculations estimated that the potential liability of CTP insurers between the date when the LCS Act came into effect and 25 June 2012 was in excess of $40 million.

Legislative Framework

1. The following legislation is relevant to this application and the appeal.

1. Section 128 MAC Act need not be set out. It is a provision which sets out the permissible calculation of the sum for damages to which a claimant under that Act may be entitled as a result of the provision to him or her of gratuitous attendant care services. The section limits the sums of money which may be recovered.

1. Section 130A of the MAC Act provides:

"130A No damages for expenses covered by Lifetime Care and Support Scheme

No damages may be awarded to a person who is a participant in the Scheme under the Motor Accidents (Lifetime Care and Support) Act 2006 for economic loss in respect of the treatment and care needs (within the meaning of that Act) of the participant that relate to the motor accident injury in respect of which the person is a participant in that Scheme and that are provided for or are to be provided for while the person is a participant in that Scheme."

1. Section 3 of the MAC Act sets out definitions of words and phrases used in the Act. "Economic loss" is not defined. "Non-economic loss" is defined:

""Non-economic loss" means:

(a) Pain and suffering, and

(b) Loss of amenities of life, and

(c) Loss of expectation of life, and

(d) Disfigurement."

It is clear from the structure of the MAC Act that a loss which does not come within the definition of "non-economic loss" is to be regarded as "economic loss".

1. Section 3(1) of the LCS Act defines "attendant care services" as:

"Services ... that aim to provide assistance to people with everyday tasks, and includes (for example) personal assistance, nursing, home maintenance and domestic services."

1. Section 5 of the LCS Act provides:

"Words and expressions used (but not defined) in this Act have the same meanings as in the Motor Accidents Compensation Act 1999."

1. Of particular significance is s 6 of the LCS Act:

"6. Scheme participants' treatment and care needs to be paid for by Authority

(1) The Authority is to pay the reasonable expenses incurred by or on behalf of a person while a participant in the Scheme in providing for such of the treatment and care needs of the participant as relate to the motor accident injury in respect of which the person is a participant and as are reasonable and necessary in the circumstances.

(2) For the purposes of this Act, the treatment and care needs of a participant are the participant's needs for or in connection with any of the following:

(a) medical treatment (including pharmaceuticals),

(b) dental treatment,

(c) rehabilitation,

(d) ambulance transportation,

(e) respite care,

(f) attendant care services,

(g) domestic assistance,

(h) aids and appliances,

(i) artificial members, eyes and teeth,

(j) education and vocational training,

(k) home and transport modification,

(l) workplace and educational facility modifications,

(m) such other kinds of treatment, care, support or services as may be prescribed by the regulations.

(3) As an alternative to paying the expenses for which it is liable under this section as and when they are incurred, the Authority may pay those expenses by the payment to the participant of an amount to cover those expenses over a fixed period pursuant to an agreement between the Authority and the participant for the payment of those expenses by the participant.

(4) The LTCS Guidelines may make provision for or with respect to determining which treatment and care needs of a participant in the Scheme are reasonable and necessary in the circumstances."

1. Section 7 entitled "Eligibility for participation in the Scheme" relevantly provides:

"7 ...

(3) A person is not eligible to be a participant in the Scheme in relation to an injury if the person has been awarded damages, pursuant to a final judgment entered by a court or a binding settlement, for future economic loss in respect of the treatment and care needs of the participant that relate to the injury."

1. Section 9 deals with participation in the LCS scheme as follows:

"9 Acceptance as a participant

(1) A person becomes a participant in the Scheme if the Authority is satisfied that the person is eligible to be a participant and accepts the person in writing as a participant in the Scheme, either as a lifetime participant or an interim participant (according to the person's eligibility).

(2) If the Authority is satisfied that a person is eligible to be a participant and that application for the person's acceptance as a participant has been duly made, the Authority must accept the person as a lifetime participant or an interim participant (according to the person's eligibility).

(3) A person accepted as an interim participant must be accepted as a lifetime participant if the Authority becomes satisfied during the person's interim participation in the Scheme that the person is eligible for lifetime participation in the Scheme.

(4) A person accepted as a lifetime participant in the Scheme remains a participant for life."

1. The provisions of the LCS Act, which relate to the assessment by the LCSA of the needs of a participant are:

"23 Assessment of treatment and care needs of Participants

(1) The Authority is to make an assessment of the treatment and care needs of a participant in the Scheme.

(2) The assessment is an assessment of the participant's treatment and care needs that are reasonable and necessary in the circumstances, and as relate to the motor accident injury in respect of which the person is a participant in the Scheme.

(3) An assessment of treatment and care needs is to be made in accordance with the LTCS Guidelines.

(4) The Authority is to certify in writing as to its assessment of the treatment and care needs of the participant including its reasons for any finding on which the assessment is based, and is to give a copy of the certificate to the participant."

"26 Effect of assessment

(1) The Authority's assessment of the treatment and care needs of a participant is final and binding for the purposes of this Act and any proceedings under this Act.

..."

"28 LTCS Guidelines

(1) The LTCS Guidelines may make provision for or with respect to the assessment of the treatment and care needs of a participant in the Scheme.

..."

1. The LCSA issued Guidelines from time to time pursuant to s 58 of the LCS Act. Attendant care was dealt with in Part 8 of the Guidelines. It was common ground that the LCSA might waive observance of any part or parts of the Guidelines in any particular case.

1. In Part 8 the Guidelines stated the policy with respect to attendant care:

"Policy

The Authority will fund reasonable and necessary attendant care services for participants in relation to the injuries sustained in the motor accident."

1. "Attendant care services" were defined in an extensive and inclusive way. The Guidelines recognised that there are personal needs of many different kinds which directly arise from tortiously caused injuries which had to be met by the provision of comprehensive attendant care services.

1. Clause 1 of the Guidelines provided:

"1. Attendant care services funded by the Authority

The Authority's decision on whether the attendant care services are reasonable and necessary will be based on the participant's care needs assessment.

1.1 The Authority will fund reasonable and necessary attendant care services required as a result of the motor accident injury to assist and support a participant to perform personal care tasks including:

Showering, bathing, oral hygiene, dressing and grooming

Personal hygiene including bowel and bladder care;

Eating and drinking;

Medication use;

Fitting and use of aids and appliances, hearing and communication devices;

Mobility and transfer;

or

Health maintenance, for example positioning, application of splints, regular and routine exercises or stretches.

..."

1. Clause 6 of the Guidelines provided:

"6. Attendant care - family and friends as paid attendant care workers

Policy

Employment of family members or friends as paid attendant care workers is not encouraged by the Authority, but may be necessary in some circumstances, for example, in rural and remote areas where access to attendant care workers may be limited.

Family members or friends will only be employed to provide attendant care services when it is determined by the Authority an attendant care service provider, with input from the participant and their family, to be in the best interests of the participant. This option will only be considered when all other alternative options to provision of attendant care have been exhausted."

1. The Guidelines provided that in order for a family member to provide the attendant care and be paid for it, the family member needed to be employed by an approved attendant care provider and that the family member had met that provider's criteria with respect to skills, knowledge and appropriate attitude. The Guidelines also provided that the family member must meet the provider's standards for service delivery and compliance with occupational health and safety guidelines.

1. Part 8 of the Guidelines concluded as follows:

"The Authority will not fund attendant care services that are provided by family or friends and payment for the services if requested from the Authority, where the Authority has not approved the need for care, or the care provider is not part of the participant's care plan. The Authority will not fund a family member or friend to provide inactive sleepovers."

1. It was common ground that the term "inactive sleepovers" was used in the care industry to describe the presence of a person in the same accommodation as the injured person during an overnight period when the injured person is ordinarily asleep and circumstances do not require that the care provider attend more than twice to the injured person in the course of the night.

Proceedings before primary judge

1. As his start point, his Honour set out the following principles of statutory interpretation which were not challenged before this Court:

(a) The commencing point is to engage in a purposive construction in the interpretation of a provision of an Act. A construction which promotes the purpose and/or object underlying an Act is to be preferred to the construction that would not promote that purpose or object.

(b) What is involved in an exercise of statutory construction is a search for the objective intention of Parliament and not the subjective intention of the Parliament, if one exists or of Ministers.

(c) A statement of intention by a Minister in a second reading speech will not prevail over the words of a statute.

(d) Legislation must be construed by reference to the language which Parliament has used in the enactment as distinct from what others including Ministers, may wish or think that the Parliament intended.

(e) The Courts in exercising judicial power interpret legislation by determining what Parliament intended to mean by the words it used. The Court does not determine what Parliament intended to say or make any attempt to divine the intention of Parliament.

(f) In interpreting legislation the primary object is to construe the relevant provisions so that they are consistent with the language and purpose of all of the provisions of the statute.

(g) Legislation must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears between provisions, it must be alleviated as far as possible, by adjusting the meaning of the competing provisions to achieve a result. This adjustment may require the Court to determine a hierarchy of provisions.

(h) It is both permissible and appropriate to have regard to contextual material without a need for ambiguity to be established.

(i) The contextual material, to which reference may be made, includes the history of a particular enactment and the state of the law when it was enacted, namely the legal and historical context of the legislation.

(j) It is an established principle that a statute should not be presumed to abrogate existing fundamental or common law rights in absence of clear language. The nature of the right being abrogated will determine whether the principle is strong or weak. (WB 40-41)

1. In reviewing the legislation, his Honour had regard to s 54 of the LCS Act, although it had not been referred to in submissions. His Honour interpreted the section as giving the LCSA an entitlement to recover from a motor vehicle tortfeasor or the CTP insurer the present value of the LCSA's treatment and care liabilities in respect of the motor vehicle accident. He considered that right of recovery to be unqualified.

1. His Honour found that s 54 was relevant to a consideration of how it was envisaged that the scheme would work. As a result, his Honour concluded that regardless of whether a person was accepted into the scheme or not, s 54 meant that the CTP insurer would have to pay a sum of money which fully compensated for the injuries and disabilities suffered, including the injured person's treatment and care needs.

1. Having considered the provisions of the LCS Act and the Second Reading Speech, his Honour set out what he regarded as the purpose of the Act. In this Court, both the applicant and the first respondent accepted the correctness of that analysis.

1. His Honour found that it was the intention of government to establish a scheme with the following features:

"a) It would cover those who, as a consequence of a motor vehicle accident, were catastrophically and permanently injured;

(b) The injuries were such that the individuals would require treatment and care for the whole of their lives.

(c) The LCS scheme would provide for all of that treatment and care, including attendant care, for as long as it was necessary on an individually assessed basis;

(d) Because the LCS scheme would attend to the provision of lifetime treatment and care, an injured person would not need, and would not be entitled to, compensation by way of damages for any treatment and care needs, including attendant care;

(e) The only limitation on the provision of treatment and care was that it was reasonable in the circumstances and that the injury was caused in a motor vehicle accident." (WB 51)

1. By reference to both the MAC Act and the LCS Act, his Honour concluded:

"93 Nowhere in either of the Acts is there a clearly expressed intention to abolish G v K damages. Rather, the expectation seems to be that the attendant care services will be provided as part of the LCS scheme and that there will be no need for G v K damages to be assessed and paid." (WB 54)

1. Using "G v K damages" as a term of convenience to include damages for attendant care awarded in accordance with s 128 MAC Act, his Honour identified three ways in which the legislation might operate:

"(a) G v K damages remain outside the LCS scheme and are the direct expense of the CTP insurer in the usual way.

(b) G v K damages are wholly subsumed by the LCS scheme and are no longer available to a claimant who is also a lifetime participant in the Scheme; or

(c) G v K damages are available but only up to the date of judgment or settlement of the damages claim where gratuitous services have in fact been provided to the claimant and have not been paid for under the LCS scheme. They are not available after that time in respect to any services which are to be provided in the future." (WB 56-57)

1. His Honour then set out the submissions in favour of each approach. In relation to "option (c)" his Honour said:

"107 This option commences by accepting the interpretation of s 6(1) of the LCS Act, namely that the expression " expenses incurred " means an expense which has been paid, and for which a legal liability to pay exists. This has the consequence that, at least as at the date of any judgment or settlement, gratuitously provided attendant care is not an expense which has been incurred.

108 It does not accept that the phrase "expenses incurred" is to be equated, as the LCS Authority submitted it should be, with what the LCS Authority has "provided for" as a component part of an assessment which accords with s 23 of the LCS Act. But it accepts that a care plan can provide for attendant care which is gratuitous.

109 This is then supported by concentration on the terms of s 7(3) of the LCS Act which prohibits eligibility for the LCS Scheme where an applicant

"...has been awarded damages, pursuant to a final judgment entered by a court or by a binding settlement, for future economic loss in respect of the treatment and care needs of the participant." (emphasis added)

110 In other words, acting upon the basis of what appears on the face of s 9(4) of the LCS Act, a person is only disqualified from participating if they receive money for the provision of future services, which the LCS Scheme would otherwise be obliged to provide. If the LCS Scheme has not paid for services in the past, then there is nothing to debar the participant from recovering, from the motor vehicle tortfeasor or else the CTP insurer, those damages. In such a case, there would be no double compensation, and hence the terms of s 130A of the MAC Act would be satisfied." (WB 58-59)

1. Having reviewed the competing submissions, his Honour concluded that the most appropriate interpretation was that set out in "option (c)". In the course of carrying out his analysis of the legislation, his Honour found that the part of the Guidelines which stated that the Authority would not fund attendant care services provided by family or friends in certain circumstances (see [43] hereof) was invalid.

1. In his reasoning process, his Honour reached conclusions concerning the MAC Act and LCS Act:

"143 ...

(a) Once a person becomes a participant in the LCS Scheme, there is an acknowledgment that their injuries are sufficiently serious and permanent, such that they are unlikely to appreciably change for the future. Hence once they are a participant in the LCS Scheme, they remain a participant for life: s 9(4) of the LCS Act.

(b) The LCS Authority is obliged, subject to questions of reasonableness and causation, to make an assessment of all of the treatment and care needs of a participant in the Scheme: s 23(1) of the LCS Act, which is final and binding as between the participant and the LCS Authority: s 26 of the LCS Act, and which is only to be revised to give effect to the findings of a review panel under s 25 of the LCS Act.

(c) The assessment of the treatment and care needs of a participant is to be made in accordance with the LCS Scheme: s 23(3) of the LCS Act. The Guidelines are akin to regulations and therefore subordinate legislation. Those Guidelines cannot derogate from the overall requirements of the legislation so as to diminish the LCS Authority's obligation to provide for the treatment and care needs of an individual participant.

(d) The LCS Guidelines insofar as they state that " [t]he Authority will not fund a family member or friend to provide inactive sleepovers ", are not valid, and do not, alone, provide a proper basis for declining to pay for attendant care services provided by way of inactive sleepovers, by a family member or friend.

(e) Where the injuries sustained by the participant have been wholly or partially caused by the negligence of a motor vehicle tortfeasor, the CTP insurer remains obliged, if and when called upon, to pay to the LCS Authority, money for the treatment and care costs of the participant: s 54(1) of the LCS Act.

(f) The creation of the LCS Scheme by the LCS Act was not intended to limit the application of the MAC Act in respect of a participant in the Scheme except as specifically provided for by that Act: s 11(1) of the LCS Act. The only provision of the MAC Act which limits or otherwise affects its application is s 130A of the MAC Act.

(g) Section 130A of the MAC Act is intended to prevent double compensation and is addressed to " ... economic loss in respect of ... treatment and care needs ... ", but only where those treatment and care needs " ... are provided for or are to be provided for ... " to a participant by the LCS Scheme.

(h) Section 6 of the LCS Act identifies an obligation upon the LCS Authority to pay for expenses incurred by or on behalf of a participant, or moneys for which a legal liability exists to pay. That legal liability may include a claim being made for monies assessed on a quantum meruit basis by the provider of the services. Such a claim is not one based on contract, because it assumes the absence of a binding contract, but rather is imposed by a rule of law arising from the acceptance of the services provided and the benefit conferred on the recipient by the provision of those services.

(i) Where a treatment and care plan includes the provision of attendant care services, whether gratuitous or paid, the plan constitutes an acknowledgement of the reasonableness of those services and the need for the provision of them, and as well, their causal relationship to the motor vehicle accident. It is an acknowledgment that in order to properly provide for the treatment and care needs of the participant, the attendant care services are an integral feature and should be provided for by the LCS Authority in fulfilment of its mandate.

(j) Where however, the LCS Authority does not pay for those services, and either does not have or else does not accept an obligation to pay for those services, then, within the meaning of s 130A of the MAC Act, the services when delivered prior to an assessment date, have not been " ... provided for ... " and damages can still be recovered under the MAC Act for such services. However, since such services are a necessary part of the treatment and care needs of the participant, and since the LCS Authority is obliged to provide for those services in the future, the future attendant care services are excluded from an award of damages to a participant by reason of s 130A of the MAC Act, because they are "...to be provided for ...".

(k) This interpretation is consistent with s 7(3) of the LCS Act which prevents eligibility to participate in the LCS Scheme, by reason of receipt only of damages (by settlement or judgment) for future economic loss relating to treatment and care needs." (WB 66-68)

1. His Honour recognised that as with most determinations involving preliminary and separate questions, the answers provided were often largely hypothetical depending upon the extent to which facts had been agreed or determined. In this case, his Honour noted that different answers would be given depending upon the factual findings eventually made. In particular, his Honour noted:

"(i) Had the LCS Scheme paid for or accepted an obligation to pay for attendant care services up to the date of assessment. If so then no damages for attendant care would be recoverable by the injured claimant from the CTP insurer because the claimant did not have any unmet needs.

(ii) If the LCS Scheme had not paid or accepted an obligation to pay for attendant care services, then damages up to the date of assessment were recoverable calculated in accordance with s 128 of the MAC Act from the CTP insurer by the injured claimant.

(iii) There was necessarily a question of fact which had to be determined in each case as to whether attendant care services had or had not been delivered to the injured claimant up to the date of assessment. Where the LCS authority had not paid for those services under s 6 of the LCS Act and where there was no acceptable proved legal obligation to pay for them, then there had been no provision of attendant care services by the LCS authority and damages under s 128 of the MAC Act were available up to the date of assessment." (WB 68-69)

1. Those determinations by the primary judge answer the questions relating to claims made by the first respondent against the third respondent and the applicant. In relation to the second respondent, his Honour concluded that she was entitled to recover from the third respondent any debt owed by it to her. The difficulty, given that her claim had not yet been finally formulated and pleaded, was to determine its legal basis. His Honour considered without finally deciding, that the second respondent might well have a claim based on quantum meruit against the third respondent (WB 71).

The appeal - submissions and consideration

1. The first two grounds of appeal challenge the primary judge's interpretation of s 54 LCS Act. The remaining grounds of appeal are:

"3. The primary judge erred in finding that the first respondent, as a participant in the Lifetime Care and Support Scheme, is entitled to recover from the appellant or his compulsory third party insurer, damages in accordance with s 128 of the Motor Accidents Compensation Act 1999 (MAC Act) for the period from the date of the accident to the date of judgment or settlement of the first respondent's damages claim, unless the Scheme has incurred an "expense" under s 6(1) of the LCS Act with respect to the provision of attendant care services by the second respondent.

4. The primary judge erred in his construction of s 6(1) of the LCS Act, in failing to find that the third respondent's obligation to pay the "reasonable expenses" of providing for the treatment and care needs of the first respondent, did not extend to the attendant care services provided by the second respondent notwithstanding that the second respondent's attendant care services were recognised by the third respondent as part of its "Care Plan" for the first respondent.

5. The primary judge erred in failing to find that, on proper construction of s 130A of the MAC Act, the first respondent's entitlement to damages under the MAC Act against the appellant is limited to damages for non-economic loss and loss of earning capacity/wage loss/superannuation.

6. The primary judge erred in refusing to make a declaration in terms of his Honour's answer to the separate question which concerned the liability of the appellant to pay damages to the first respondent under the MAC Act."

1. Although the Amendment Act has resolved the principal issue raised by the appeal, the Amendment Act did not take effect until June 2012. This left a period of almost 6 years, during which there was a potential liability for gratuitous attendant care on the part of CTP insurers, which could be claimed by participants in the LCS Scheme. This liability could be as much as $40 million. In those circumstances, the Court decided that leave to appeal should be granted.

1. The grounds of appeal relating to the primary judge's interpretation of s 54 LCS Act did not challenge any of the answers given to the questions placed before him, but rather challenged an aspect of his reasoning. As such, they did not form an appropriate basis for an appeal. Moreover, they did not raise any matter which was at issue between the applicant and the first and/or second respondent. The issue which they raised concerned the third respondent, which did not participate in the appeal. Consequently, the Court did not have the benefit of submissions to contradict those of the applicant.

1. His Honour's reference to s 54 was only peripherally related to the questions which he was asked to answer and formed but a minor part of his reasoning process. It was irrelevant to the issues before his Honour and is irrelevant to the issues before this Court.

1. That having been said, his Honour does, with respect, appear to have misread s 54 LCS Act. In its terms it relates only to motor accidents involving uninsured (unregistered) or interstate vehicles or third party (non-motor vehicle) tortfeasors. It is only in those cases that the LCSA has a right of recovery in respect of its liability to a participant in the scheme from the owner or driver of an uninsured (unregistered) motor vehicle or from an interstate third party insurer or from a non-motor vehicle tortfeasor (or insurer).

1. With such an application, s 54 was clearly irrelevant to the issues before the primary judge and this Court. Accordingly, his Honour's remarks in relation to it were obiter and as indicated, probably based on a misreading of the section.

1. It was common ground that the two sections which were determinative of the questions posed were sections 6(1) of the LCS Act and s 130A of the MAC Act. The two sections were introduced at the same time as part of the same legislative package.

1. The applicant submitted that the clear legislative purpose in introducing the LCS Scheme was that it would provide for all treatment and care needs of participants and that all costs associated with meeting a participant's care and treatment needs would be met by the LCSA. That being so, the applicant submitted that the introduction of the scheme made any concept of "gratuitous care" for participants in the scheme redundant.

1. The applicant submitted that on the construction of those sections, adopted by the primary judge, the LCS Scheme was not fully funded at all. Rather compulsory third party insurers were left to bear liability for part of the care needs of participants up to the date of judgment or settlement of each participant's damages claim. The applicant submitted that such an interpretation was contrary to the clear intention behind the implementation of the LCS Scheme.

1. The applicant submitted that the words of s 6(1) LCS Act and s 130 MAC Act should be interpreted in accordance with that intention.

1. The applicant accepted that while other sections of the LCS Act such as s 23 dealt with the assessment of the reasonable treatment and care needs of a participant in the scheme, the only section which obligated a payment for those needs was s 6(1). The applicant was not able to identify any other section which had that effect. While the applicant did not make this concession, it also seems clear that the obligation of the LCSA to pay "reasonable expenses incurred" under s 6(1) would not pick up gratuitously provided attendant care services at common law (under the principle in Griffiths v Kerkemeyer) or under s 128 MAC Act.

1. This is because in the traditional G v K situation, services are provided by a friend or family member gratuitously without any agreement or obligation to do so. It follows that the provision of such services gratuitously could not be regarded as "expenses" and certainly not as "expenses incurred" by the participant in the LCS Scheme. The obvious meaning of the phrase "expenses incurred" is an expense which the participant has met or is legally obliged to meet.

1. It seems clear therefore that the traditional G v K situation or that provided for by s 128 MAC Act was not included in the expenses which the LCSA is obliged to meet pursuant to s 6(1). It would involve an unwarranted distortion of the language of s 6(1) LCS Act to give to that phrase any other interpretation. The provision of gratuitous services by a family member or friend to the participant in circumstances where there was no agreement or other legal obligation on the part of the participant to pay that person for those services could not amount to "expenses incurred" as referred to in s 6(1). This was the effect of the language used even though it may not have been what Parliament intended.

1. If s 6(1) does not require the LCSA to pay for gratuitous attendant care services or services provided pursuant to s 128 MAC Act, then a participant in the Scheme cannot require the LCSA to pay for those services. Accordingly, the first respondent would have no claim against the third respondent for such services. The question then arises - would the first respondent, as a participant in the Scheme, be able to claim damages against the applicant or his CTP insurer, pursuant to s 128 of the MAC Act or would such a claim be excluded by s 130A of the MAC Act?

1. The applicant accepted that the reference to "economic loss" in s 130A MAC Act included damages for attendant gratuitous care pursuant to s 128. This was because under the MAC Act damages which are not included in the definition of "non-economic loss" are treated as economic loss.

1. The applicant submitted that the words "needs" and "provided for" in s 130A were decisive in determining the meaning of the section. The applicant submitted that the section was concerned with "needs" which "are provided for or are to be provided for". It did not refer to "expenses" which "are paid for or are to be paid for". In that context, the applicant submitted, the treatment and care needs were provided for if the care plan took them into account and made provision for the needs to be met. That was so even if the needs had been met, or were to be met, by gratuitous attendant care provided by a friend or family member of the participant.

1. The applicant submitted that gratuitous attendant care provided by a friend or family member of the participant, if it were included in the care plan, and the care plan had been implemented or was to be implemented, satisfied the description in s 130A of "treatment and care needs ... that are provided for or are to be provided for". The applicant submitted that such an interpretation was consistent with the intention behind the scheme (see [47] hereof).

1. The contrary interpretation is that s 130A of the MAC Act excludes recovery of damages under s 128 only to the extent that the participant's needs "are provided for or are to be provided for" while in the Scheme. This means that for the exclusion to operate, the participant must be entitled to compensation for those needs under the Scheme. Otherwise, what is apparently a provision to prevent the double recovery of damages, would have the effect of depriving the participant of compensation in certain circumstances. Explicit language would have to be used to achieve that result.

1. The submission proceeds that for the reasons already indicated, if the participant is not liable to pay a family member or friend for the attendant care services provided, there are no relevant expenses under the Scheme to be reimbursed by the Authority to him or her. The needs fulfilled by the friend or family member are thus not ones "provided for under the Scheme" and are not excluded by s 130A of the MAC Act from a damages claim. This would require that the words "are provided for" or "are to be provided for" as used in s 130A be given the meaning "are paid for or are to be paid for".

1. I prefer the latter interpretation of the words "provided for". Such an interpretation fits more easily with a provision to prevent double recovery of damages. It also fits more easily with a provision which is specifically referring to "damages", i.e. a monetary amount.

1. The above analysis is sufficient to deal with the issues raised in Grounds of Appeal 3 - 5. For completeness, however, it is necessary to say something about his Honour's response to Question 4 which concerned the claim by the second respondent against the third respondent. In making these observations, I am conscious that they are obiter and affect the third respondent which did not participate in the appeal. Nevertheless, they potentially could affect the first respondent in any claim against the applicant or his CTP insurer under s 128 MAC Act and determine whether such a claim was excluded by s 130A. This is often a problem when preliminary issues are decided based on hypothetical facts.

1. There may be a factual question in this and other cases as to whether a participant in the Scheme is liable to the friend or family member. There will obviously be liability if there has been an express agreement to pay. There could possibly be an implied agreement if the friend or family member made it clear that he or she wanted to be paid (albeit by the Authority) and the participant accepted the services on that basis. The participant could also be liable to the friend or family member upon the basis that the latter provided emergency services to assist someone in distress (see the discussion in Mason & Carter's Restitution Law in Australia, 2nd ed, LexisNexis Butterworths: Sydney (2008), p 824).

1. In those circumstances, the provisions of s 6(1) of the LCS Act would require the LCSA to pay the expense thereby incurred. Of course, an agreement between a participant in the Scheme and a friend or family member that he or she be paid for the provision of attendant care services might not be retrospective. Services provided in the past might not constitute sufficient consideration.

1. In such circumstances where the participant had a claim on the LCSA for the expenses of meeting his needs, s 130A of the MAC Act would preclude the participant from making any claim for damages against the applicant or his CTP insurer with respect to those needs. This is because the meeting of those needs would constitute an expense "incurred" which the LCSA would have to pay and therefore the expenses would be "provided for" in the relevant sense.

1. The same situation might arise if the second respondent did have a quantum meruit claim against the LCSA, even if the participant in the Scheme did not. However, there is a difficulty with a quantum meruit claim in this case. Normally, there would only be an obligation on the LCSA to pay for services if there had been a request by it in circumstances where it could be inferred that it was prepared to pay for those services. However, the certificates prepared by the LCSA which set out the first respondent's care plan made it clear that the LCSA was not prepared to pay for the second respondent's services but that they were to be provided gratuitously.

Conclusion and Orders

1. For the reasons set out above, Grounds of Appeal 1 and 2 concerning s 54 of the LCS Act do not arise. Grounds of Appeal 3, 4 and 5 should be dismissed.

1. The issue raised in Ground of Appeal 6 does not arise. No point was taken, either by the first respondent or by this Court, concerning the standing of the applicant to challenge the primary judge's answer to Question 5. Accordingly, I would dismiss that Ground of Appeal.

1. While my reasoning on some aspects of the appeal is somewhat different to that of the primary judge, my conclusion on the issues raised in the appeal is the same. It follows that the appeal should be dismissed.

1. The orders which I propose are:

(1) Leave to appeal is granted.

(2) The appeal is dismissed.

(3) The applicant to pay the first and second respondents' costs of the appeal.

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Decision last updated: 20 February 2013