Gordian RunOff Limited v Dimos

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Gordian RunOff Limited v Dimos [2024] NSWPIC 532
CLAIMANT:	Effie Dimos
INSURER:	Gordian RunOff
MEMBER:	Allan Cowley
DATE OF DECISION:	4 September 2024
CATCHWORDS:	MOTOR ACCIDENTS - Motor Accidents Compensation Act 1999; discretionary exemption under section 92(1)(b); application for assessment of damages for past and future economic loss; discretionary exemption sought by insurer on basis that claimant has made false and misleading statements as to the nature of the injuries and economic losses; mild traumatic brain injury, soft tissue injuries, and psychological injury alleged as a result of a head-on collision where claimant was asleep as a passenger ; third-party witnesses require cross examination and cannot be compelled to attend the Personal Injury Commission (the Commission) but may be compelled by subpoena; Held – matter not suitable for assessment at the Commission; recommendation to issue a Certificate of Exemption; recommendation subsequently approved by the Division Head, as the President’s delegate.

INTRODUCTION

The Insurer is seeking discretionary exemption of this matter from the Personal Injury Commission (PIC) pursuant to Section 92(1)(b) of the Motor Accidents Compensation Act 1999 (“The Act”).
The Claimant has made Application for Assessment of Damages at the PIC, and the matter has been allocated to me for assessment.
The Insurer has now made this Application for Discretionary Exemption from the PIC on the basis that the Claimant has made false and misleading statements in relation to this claim. Specifically, the Insurer contends that the Claimant has made false and misleading statements as to the nature of the injuries she had allegedly suffered, and the economic losses she has sustained.
The Insurer submits that in light of the false and misleading statements it contends have been made by the Claimant, this claim is not suitable for assessment at the PIC.
The Claimant denies she has made false and misleading statements at any stage and opposes the matter being exempted.
The Insurer made their Application for Exemption on 7 August 2024 and I therefore directed that the Claimant should make Written Submissions in Reply by 28 August 2024. which was done as directed.
Having read the written submissions I then convened a further PC on 4 September where the parties put further oral submissions.

LEGISLATIVE CONTEXT

Section 92(1)(b) of the Act provides that a Claim is exempt from assessment if a member has made a preliminary assessment of the claim and has determined (with the approval of the Divisional Head of the Motor Accidents Division of the PIC) that it is not suitable for assessment.
Sully J at paragraph 37 in Allianz Australia Limited v Motor Accidents Authority NSW & Ors [2006] NSWSC 1096 (the “Lorusso” matter) stated that what is required of a member is “simple, succinct and clear” reasons. When making a preliminary assessment of this Claimant, a member is required to take into account all of the circumstances of the claim at the time of his/her consideration and in particular, in this instance Clause 14.16.10 of the Claims Assessment Guidelines (“the Guidelines”).
As well as the Guidelines a member must also consider when exercising his/her discretionary judgment, the objects of the Act as set out in Section 5 of the Act, any relevant case law and his/her experience.
The statutory question a member must ask is whether the claim is or is not suitable for assessment under Part 4.4 of the Act. When answering this question, a member must consider as well as any other relevant considerations. In this instance the ground invoked is Clause 14.16.10.
An Insurer will rely on Section 117 of the Act referrable to false claims and clause 14.16.10 of the Guidelines referrable to the allegation that a person has made a false or misleading statement(s).

RELEVANT CASELAW

This area of the Act and the guidelines has been considered many times by the Supreme Court.
In Zurich Australia Insurance Limited v NAA and Another [2006] NSWSC 845 (“Zurich”) Hoeben J noted that the provision of exemptions meant [53]” …There will be some claims which are exempt from assessment, but they will be in the minority and be the exception… Hoeben J’s decision in Zurich was followed by Sully J in Lorusso where he said at [37] “What is fairly to be expected of the Assessor is that there should be available a statement, one simple, succinct and clear to reference which either an appellate court or other court of competent jurisdiction can test logically and according to correct principle whether the Assessor’s decision is supported by a process of reasoning that is supportable in law and in fact”.
In Insurance Australia Limited trading as NRMA Insurance vs Motor Accident Authority of NSW and Ors; Kelly v Motor Accidents Authority of NSW and Another [2007] NSWCA 314, Spiegelman CJ concluded that Hoeben J was correct when he identified exemptions as being in the minority of cases and that the scheme envisages “the vast majority of cases will be determined by Claims Assessors” and that the important objectives of the Act is to “keep premiums affordable” and that the objective of the Act is to minimise the cost the dispute resolution process.
How an Assessor is to determine an Application for Exemption has been considered in five Supreme Court decisions.
The first was the decision of Allianz Australia Insurance Limited v Tarabay [2013] NSWSC 141 (“Tarabay”) where there was an allegation that with respect to the Claimant’s employment history a document had been forged. The Insurer made an Application for Exemption which the Claims Assessor refused and the Insurer appealed. Rothman J identified that the Assessor had asked herself the wrong question and said “the issue that was before the Assessor was whether the exemption should be granted. The question that has been answered is whether Allianz has proved fraud. That is not the question that was before the Assessor”. In Insurance Australia Limited NRMA Insurance v Banos [2013] NSWSC 1519 (“Banos”) Campbell J stated at para 42;
“In a case like the present where only cl14.16.11 is invoked, the Claims Assessor will fall into jurisdictional error if he or she purports to decide whether the Claimant, or some other person, has in fact made a false or misleading statement in a material particular in relation to the injuries, loss or damage sustained by the Claimant, at least except in the rarest of cases where it is so clear that a person has not made such a false or misleading statement as to be beyond argument.”
Campbell J in Banos helpfully identifies a number of relevant considerations when exercising the administrative discretion to exempt the claim or not;
“s43. When deciding the statutory question in a case that turns upon whether a person has made a false and misleading statement, the following considerations are likely to be relevant. I do not mean to be exhaustive:
(a)      the Act contemplates that the great majority of disputes will be resolved by the assessment process, and not in court;
(b)      however, the consideration that s.92 provides for both mandatory exemptions and discretionary exemptions provides a clear legislative guidepost that appropriate cases should be "redirected" to the court system at an early time by way of preliminary determination;
(c)                 a primary question will be, having regard to the nature of the issue raised, whether both parties can be afforded a hearing (assessment conference) which is in a practical sense fair having regard to the nature of the allegation raised;
(d)      a related question will be which mode of hearing will resolve the dispute more efficiently and effectively, bearing in mind the comparative limitations and advantages of an assessment conference on the one hand, and a court hearing on the other. Advantages of the latter may include a better opportunity for proper and fair cross-examination of witnesses whose credit is to be impugned and the greater availability of cross-examination of medical experts on the material which may call a claimant's reliability into question;
(e)      as it is clear the claimant's credit will be called into question, a consideration of whether it is in the public interest that such an examination occur in open court;
(f)       Finally, but by no means least, the consideration that it is not mandatory, whenever a credit issue is raised, to decide that the claim is not suitable for assessment under Part 4.4.”
The decision of Insurance Australia Limited trading as NRMA v Milton [2016] NSWSC 1521 (“Milton”) is also relevant when considering whether an allegation of false or misleading statement has been made. Beech-Jones J in Milton stated at para 27;
“Ultimately, the test to be applied is that stated in s92(1)(b) of the MAC Act. Nothing in s92(1)(b) or the guidelines suggest that the mere making of an allegation by an Insurer of the making or a false or misleading statement, even one that is fully particularised, necessarily leads to a conclusion the claim is not suitable for assessment. To the contrary, the notation to cl14.16.11 suggest that the Assessor is able to, and perhaps should, obtain particulars of the allegation as part of an evaluation as to whether the making of the allegation warrants the conclusion that the matter is or is not suitable for assessment”.
In Insurance Australia trading as NRMA Insurance v Taylor [2017] NSWSC 507 (“Taylor”) Davies J considered both Banos and Tarabay. In Taylor the Claimant had denied in the claim form and to eight medico-legal doctors and medical assessors, any previous accident or relevant medical history. However records from the physiotherapist indicated that was not the case.
Davies J in Taylor made the important point that it is not just the fact that the Insurer has made an allegation that should trigger the exemption of the claim. Once the allegation is made, the Assessor must make enquiries in order to undertake an evaluation of whether the particular allegation in particular being considered renders the claim suitable or not suitable for assessment. In para 38 he said;
“…Although, as Tarabay and Banos make clear, it is an error for the Assessor to make a determination about whether a statement is false or misleading, it is difficult to see how an Assessor would be in error in forming some sort of preliminary view, and it is difficult to see how the Assessor would not have to form such a preliminary view, about the allegation to determine whether the claim is not suitable for assessment; Insurance Australia Limited trading as NRMA Insurance Limited v Milton [2016] NSWSC 1521 at [26-27]. As Campbell J makes clear at [43f] in Banos It is not sufficient that an allegation alone has been made for the discretion to be exercised that a claim is not suitable for assessment. Something more will be needed. Cl17.3 also points to the view that the seriousness of what has been alleged must be a consideration. Justice Campbell allowed for the rare position [39] and [42] that the Assessor could determine that person clearly has not made such a false and misleading statement that points also the forming of a preliminary view”.
As Davies J said in Taylor it is not just the fact that an Insurer has made an allegation of false or misleading statement(s) that triggers the administrative discretion to be exercised that a claim is not suitable for assessment. Something more is needed. A Claims Assessor must address and evaluate the nature, the extent and the seriousness of the allegations said to be false or misleading and these considerations will inform the making of the administrative discretionary decision.
A recent decision is that of IAG Limited trading as NRMA Insurance v Abiad [2018] NSWSC 1422 (“Abiad”).
In Abiad Harrison J quashed the orders of the Claims Assessor and remitted the exemption applications of the Insurer for allocation to a different Claims Assessor to be determined “in accordance with the law”.
These were claims by both husband and wife determined to be heard together. The Insurer alleged that the husband made false or misleading statements referrable to his need to use a walking stick, prior injuries and loss of consciousness. The Insurer alleged that the wife made false or misleading statements referrable to pre-existing depression, pre-existing back pain, lawn mowing prior to the accident and inability to walk to the shops.
Harrison J held at para 76 “It is not the role of a Claims Assessor to second guess an Insurer’s allegations that a Claimant has made a false or misleading claim. S92(1)(b) and cl14.16.11 implicitly recognise that in an appropriate case an Insurer’s claims ought to be tested in a courtroom and be exposed to the type of forensic examination that the assessment process, to some extent at least, cannot necessarily provide. Much has been written about this already and it is unnecessary to expand upon it here. The simple proposition is that the Claims Assessor’s task when an application has been made is to assess the allegation and whether it is not suitable for assessment under the relevant Part. The Assessor’s role is not to determine the truth or even the strength of the Insurer’s allegation para 77 in my opinion, error is established in the present case either because there has been a constructive failure on the part of the Assessor to exercise his jurisdiction or because he has not currently dealt with the question that he ought to have asked. The question that he was required to answer was whether the claims were not suitable for assessment on the basis that there was an allegation that the first or second defendants had made false or misleading statements in a material particular in relation to their injuries”.
A further recent case was the decision of IAG Limited trading as NRMA Insurance v Khaled and ors [2019] NSWSC 320 with the decision given ex tempore on 21 March 2019.
Bellow J held that the Assessor wrongly refused the Insurer’s Application for Exemption on the basis the Assessor had failed to ask the correct question, had failed to provide adequate reasons and that there was an error of law or jurisdictional error on the part of the Assessor and referred the matter back to the PCA for a further consideration of the Exemption Application by a different Assessor. I note in that matter there was no contradictor and all defendants including the Claimant submitted to the determination of the court.
FACTUAL CIRCUMSTANCES
The Claimant was a passenger in her husband’s BMW convertible sedan on 20 February 2015. At the time she was asleep lying down in the front of the vehicle. It was 11.00 pm at night. There was heavy rain. As her husband proceeded through an intersection on Macquarie Street Sydney at Bent Street a taxi turned in front of them such that they had a head on collision.
Ms Dimos does not recall much of the accident and her extraction but she was taken by ambulance to St Vincent’s Hospital where she was treated in ED. Eventually she discharged herself because she was in fear of some of the other patients that night.
She complained of extreme pain such that she had to stay at home and be cared for. She did not return to work as an interior designer at Coco Republic and submits that she has not been able to work since that date. As a consequence, she alleges economic loss for past and future wage loss of over $1.2M.
She complained of spinal injuries.
The Claimant alleges the following injuries:
1.Mild traumatic brain injury, diffuse axonal injury, post concussive syndrome, mild neurocognitive disorder, chronic post traumatic headache / migraine.
2.Soft tissue injuries to the neck, back, chest, abdomen, right hip and right leg.
3.Psychological injury.
On 21 December 2018 MAS Assessor Moloney found that the Claimant had sustained a soft tissue injury to the cervical spine but assessed her whole person impairment at 0%. She continues to complain of headaches, although the Insurer alleges that they pre-existed the accident.
On 17 March 2020 MAS Assessor Parmegiani found that the Claimant suffered from a persistent depressive disorder and assessed her as having 17% whole person impairment.
The Insurer sought a review of that determination but was unsuccessful. The Insurer has now conceded that the Claimant is entitled to non-economic loss in relation to that psychiatric impairment.
The Insurer disputes that the Claimant has suffered a traumatic brain injury.
On 4 March 2024 I held a Preliminary Conference in which the Claimant sought a hearing date.
The Insurer objected on the basis that Particulars and Authorities had been outstanding from some 3 years. On the basis that the matter be set down for Hearing at a date some time into the future the Claimant undertook to respond to those Particulars. I directed that the Claimant reply to all outstanding Particulars and Authorities by 26 March 2024. I made further Directions as to the preparation of the matter for Hearing including that the Claimant supply a bundle of documents upon which they relied by 13 August 2024 and the Insurer by 3 September 2024 and otherwise set the matter down for Hearing at 1 Oxford Street on 17 September 2024.
On 7 August 2024 the Insurer made an Application for Exemption from Assessment at the Personal Injury Commission. The Insurer’s submissions are annexed hereto and marked “A”.
As directed the Claimant prepared written submissions in reply opposing the Application for Exemption dated 28 August 2024 which are annexed hereto and marked “B”.
The Insurer made further submissions in reply dated 2 September 2024 which I have annexed and marked “C”.
I note that the Insurer has raised several issues and in particular allegations that the Claimant has made a false and misleading statement in relation to 14.16.10 of the Guidelines.
The Claimant maintains that she has not been able to work since the date of the accident.
Pursuant to a Direction for Production the Insurer obtained documents produced by ING (Australia) Limited (ING) which suggest that the Claimant worked full-time as a sales manager with GTC Medical Pty Ltd trading as Medical Weightless Institute (GTC Medical) from 10 August 2015 to at least 17 April 2016. The documents show that the Claimant intended to purchase a property in Queensland and an Application for a loan was prepared by Yellow Brick Road Wealth Management, presumably on the Claimant’s instructions in which she sought a loan of $354,000 plus LMI to purchase a property worth $385,000 and maintained that she was working full-time for GTC Medical since August 2015. The Insurer maintains that that is fraudulent conduct by the Claimant.
Secondly that the Insurer obtained documents produced by Real Insurance which revealed that the Claimant lodged a Claim with her Income Protection Insurer, Real Insurance, on 17 March 2015 claiming that as a result of the accident she was unable to work when in fact she had obtained full time employment with GTC Medical. She received benefits of $6,000 each month for the 6 months limitation under the Policy. The Insurer maintains that the Claimant has made false and misleading statements to Real Insurance for financial gain as set out in their first submissions.
The Claimant has filed a damages schedule as of 15 August 2022 seeking $3,197,000 in damages which includes $944,403 for past economic loss as at that date, $1,326,415 for future economic loss, $141,120 for past gratuitous assistance and $293,038 for future domestic assistance on a commercial basis.
I have reviewed all of the submissions and all of the relevant documents.
The question is not whether this matter can be dealt with in the PIC or whether the claim is not suitable for assessment. See Section 92(1)(b) of the Act and the reasoning in Khaled (Supra).
It seems to me that several third-party witnesses in particular will have to be cross examined and there is no way to compel those witnesses to attend a PIC. Further that the powers of a Court to issue and obtain responses from Subpoenas is far more effective than Notices to Produce issued to third parties by the PIC. I note in particular that there are several pages of bank documents which are yet to be produced by the claimant and which may shed light on issues before any proceedings. The Insurer needs the opportunity to properly and fairly cross examine witnesses whose credit is to be impugned. Some witnesses may wish to have the benefit concerning self-incrimination which is not available at the PIC.

MY CONSIDERATION

The Claims Assessment Guidelines provide guidance as to whether a matter is suitable for assessment as set out in Chapter 14.16. The question of what is “suitable” was considered in IAG Limited Trading as NRMA Insurance v Khaled & Ors [2019] NSWSC 320. The Insurer has raised issues of complexity, liability and credit, which I have also considered in relation to 14.16 of the Guidelines.

The parties contemplate that there will be numerous witnesses and perhaps a conclave of the expert witnesses which would be inappropriate in an assessment at the PIC. No issue has been raised concerning interstate witnesses but with the passage of time that could also become a matter for consideration.
I also note that there may be a procedural issue pertaining to a late claim and the Claimant may need to seek the Court’s leave to commence proceedings given that leave of the Court must be granted pursuant to Section 109(3) of the Act where proceedings commenced more than 3 years after the subject accident.

THE SUBJECT CLAIM

54.Having considered both parties submissions and considered all of the evidence that has been submitted thus far by the parties, in my assessment this matter is not suitable for assessment at the PIC. I recommend the President of the PIC issue a Certificate of Exemption in this matter.

In accordance with s 92(1)(b) of the Motor Accidents Compensation Act 1999, the Division Head (Motor Accident Division) as Delegate of the President, on 1 October 2024, approved Member Alan Cowley’s recommendation that the claim is not suitable for assessment.

[2024] NSWPIC 532

4 September 2024