Insurance Australia Group Limited t/as NRMA Insurance v Saraceni

Case •

[2020] NSWSC 1045

•

10 August 2020

No judgment structure available for this case.

Supreme Court


New South Wales

Medium Neutral Citation: Insurance Australia Group Limited t/as NRMA Insurance v Saraceni [2020] NSWSC 1045
Hearing dates: 31 July 2019
Date of orders: 10 August 2020
Decision date: 10 August 2020
Jurisdiction:Common Law
Before: Walton J
Decision:

The plaintiff shall bring in short minutes of order reflecting this judgment within 7 days of the publication of this judgment.

Catchwords:

ADMINISTRATIVE LAW – judicial review – Motor Accidents Compensation Act – motor vehicle accident – medical review panel – medical assessments – review panel decision – Motor Accident Permanent Impairment Guidelines – legal consequences non-adherence to guidelines – findings of inconsistencies – inconsistencies not brought to first defendant’s attention – inconsistencies contemplated by guidelines – duty to provide procedural fairness – materiality – reasons for determination – whether review panel failed to set out lawful reasons – whether decision was vitiated by legal unreasonableness – errors of law – whether jurisdictional error – whether constructive failure to exercise jurisdiction – appeal upheld – costs follow the event – orders

COSTS – Suitors' Fund Act 1951 – eligibility to be granted indemnity certificate – indemnity certificate – certificate granted

Legislation Cited:

Interpretation Act 1987 (NSW)

Motor Accidents Compensation Act 1999 (NSW)

State Insurance and Care Governance Act 2015

Supreme Court Act 1970 (NSW)

Workplace Injury Management and Workers Compensation Act 1998 (NSW)

Supreme Court Act 1970 (NSW)

Cases Cited:

AB v Judicial Commission of New South Wales (Conduct Division) (2018) 365 ALR 163; [2018] NSWCA 264

Ali v AAI Ltd (2016) 757 MVR 502; [2016] NSWCA 110

Allianz Australia Insurance Ltd v Rutland (2015) 73 MVR 211; [2015] NSWCA 328

Boyce v Allianz Australia Insurance Ltd (2018) 96 NSWLR 356; [2018] NSWCA 22

Campbelltown City Council v Vegan (2006) 67 NSWLR 372; [2006] NSWCA 284

Dominice v Allianz Australia Insurance Ltd (2017) 81 MVR 249; [2017] NSWCA 171

Frost v Kourouche (2014) 86 NSWLR 214; [2014] NSWCA 39

Garcia v MAA (2009) 54 MVR 102; [2009] NSWSC 1056

Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123; [2018] HCA 34

IAG Limited v Sleiman (2017) 82 MVR 1; [2017] NSWSC 1346

Kirk v Industrial Court of New South Wales (2010) 239 CLR 531; [2010] HCA 1

Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421; [2019] HCA 3

Minister for Immigration and Ethnic Affairs v Liang (1996) 185 CLR 259; [1996] HCA 6

Minister for Immigration v Li (2013) 249 CLR 332; [2013] HCA 18

NRMA Insurance Ltd v Motor Accidents Authority NSW (2004) 61 NSWLR 264; [2004] NSWSC 56

Partridge v IAG Limited t/as NRMA Insurance (2019) 89 MVR 36; [2019] NSWSC 127

Pham v NRMA Insurance Ltd (2014) 66 MVR 152; [2014] NSWCA 22

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28

Rodger v De Gelder (2015) 71 MVR 514

Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22; [2015] HCA 51

Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43

Zurich Australia Insurance Limited v Drca (2018) 87 MVR 100; [2018] NSWSC 1945

Category:Principal judgment
Parties:

Insurance Australia Group Limited t/as NRMA Insurance (Plaintiff)

Eduardo Saraceni (First Defendant)

State Insurance Regulatory Authority (Second Defendant)

Thomas Newlyn, in his capacity as a medical assessor appointed by the Second Defendant comprising the Medical Review Panel; Samson Roberts, in his capacity as a medical assessor appointed by the Second Defendant comprising the Medical Review Panel; and Peter Anderson, in his capacity as a medical assessor appointed bv the Second Defendant comprising the Medical Review Panel (Third Defendant)
Representation:

Counsel:
J Gumbert (Plaintiff)
M Robinson SC with J Lucy (First Defendant)

Solicitors:
Moray & Agnew Lawyers (Plaintiff)
CBD Law (First Defendant)
Crown Solicitor’s Office (Second and Third Defendants)
File Number(s): 2019/70134

Judgment

  1. HIS HONOUR: By a further amended summons filed in Court on 31 July 2019, Insurance Australia Group Ltd, trading as NRMA Insurance (“the plaintiff”) sought orders in the supervisory jurisdiction of this Court in the nature of certiorari, or alternatively, setting aside and declaring invalid a decision (and/or medical assessment and Review Panel Certificate) of a Medical Review Panel dated 4 December 2018. That Medical Review Panel was comprised of three medical assessors appointed by the State Insurance Regulatory Authority (“SIRA”): Dr Thomas Newlyn (Chairperson), Dr Samson Roberts and Dr Peter Anderson. Drs Newlyn, Roberts and Anderson, in their capacity as medical assessors, were listed jointly as the third defendant. The plaintiff also sought an order in the nature of a mandamus, remitting the matter the subject of the Review Panel decision and the Review Panel Certificate to the SIRA for reallocating to a different constituted review panel and other relief, if necessary.

FACTUAL BACKGROUND

  1. These proceedings arise from a claim by Mr Eduardo Saraceni (“the first defendant”) for damages under the Motor Accidents Compensation Act 1999 (NSW) (“the Act”) for injuries allegedly caused by a motor vehicle accident on 28 October 2016.

  2. The first defendant suffered from post-traumatic stress disorder (“PTSD”) as a result of the accident.

  3. The plaintiff is the Compulsory Third Party (“CTP”) insurer of the vehicle at fault in the accident.

  4. The second defendant, SIRA, is a State government agency which administers the entire CTP insurance and compensation scheme under the Act.

  5. The third defendant is the medical assessors that comprised the Medical Review Panel, constituted under s 63 of the Act. Medical assessors are appointed under s 59 of the Act, and are part of the Medical Assessment Service (“the MAS”), a unit established pursuant to s 57A of the Act.

  6. There was a medical dispute regarding the first defendant’s degree of whole person impairment pursuant to s 58(1)(d) of the Act, such that his entitlement to damages for non-economic loss, pursuant to s 131 of the Act, was in issue.

  7. On 13 July 2017, Dr Peter Snowdon provided a medico-legal report assessing the first defendant as having 22% whole person impairment.

  8. On 26 November 2017, Dr Matthew Jones provided a medico-legal report assessing the first defendant as having 5% whole person impairment.

  9. The first defendant applied to the MAS for an assessment of a permanent impairment dispute on 11 December 2017. Included in that application was a form indicating that the first defendant had assessed his difficulty in concentrating at 4 (“extremely”).

  10. The first defendant was assessed by medical assessor, Dr Alan D Jager (hereinafter, “Assessor Jager”). Assessor Jager provided a certificate under Pt 3.4 of the Act on 28 March 2018 stating that the first defendant’s PTSD gave rise to a permanent impairment which was not greater than 10%. (Assessor Jager assessed that the first defendant’s PTSD gave rise to a 5% whole person impairment and made a 1% provision for “adjustments % for the effects of treatment”).

  11. The first defendant successfully applied to the proper officer of the SIRA to refer the medical assessment to the third defendant, under s 63(1) of the Act.

  12. On 4 December 2018, the third defendant issued a “Review Panel Certificate” determining that the first defendant’s PTSD, caused by the motor accident, gave rise to a whole person impairment which was greater than 10%. (The reasons given by the third defendant indicated the total percentage of whole person impairment for assessed psychiatric injuries caused by the motor vehicle accident was 15%).

  13. In substance, by the further amended summons, the plaintiff effectively challenged the decision of the third defendant in that respect.

GROUNDS FOR JUDICIAL REVIEW AND THE RELIEF CLAIMED

  1. As stipulated in the further amended summons, the plaintiff contended that the decision of the third defendant consisted of three errors which were expressed as follows:

2. As to the review panel decision, the review panel erred in making its decision in the following respects:

(a) The First Error - The review panel failed to comply with Clause 1.41 of SIRA's Motor Accidents Permanent Impairment Guidelines (made pursuant to section 44(1)(c) of the Act) in that the review panel failed to bring its findings of inconsistencies to the claimant's attention and to give him a chance to respond. In particular, the panel failed to bring the following inconsistencies to the claimant's attention:

(i) On page 5, the review panel noted that Assessor Jager's assessment was that "His estimate of his concentration was more pessimistic than his real deficit."

(ii) The panel noted on page 10 that "he did not exhibit a short-term or long-term memory deficit" and "His concentration was not impaired in this clinical interview with no problems in organising and answering questions."

(iii) On page 10, the review panel recorded that the claimant reported: "I lose concentration, I get upset, I don't read now, I can watch comic movies but I don't watch them all the way through. I feel bad inside and / don't enjoy them. Before the accident I was paying the bills. I stopped now and my wife does it. My head is not working properly.”

(iv) On page 13, the panel noted "There were no specific concentration deficits obvious during the assessment interview."

(v) The history given to the review panel, and the review panel's findings, were inconsistent with information obtained through the medical records (particularly the report of Assessor Jager, which was based on an assessment less than 8 months earlier), in a number of respects, including in relation to Self-Care and Personal Hygiene, Social and Recreational Activities, Concentration Persistence and Pace, and Adaptation.

(b) The Second Error - The review panel was obliged to set out lawful reasons for its determination pursuant to section 61(9) of the Act and clause 16.24 of the SIRA's Medical Assessment Guidelines dated 1 October 2008 made pursuant to sections 44(1)(d) and 65(1) of the Act. The review panel failed to set out lawful reasons in a number of significant respects, inter alia, as follows:

(i) The review panel failed to explain why it concluded, on page 11, that "There was consistency between the history of current psychiatric symptoms, presentation at the assessment interview and Findings on examination" in light of the apparent inconsistencies as set out at (a) above.

(ii) There was internally inconsistent reasoning in that the review panel noted in its reasons that the claimant did not demonstrate concentration difficulties during examination but then found that the claimant had significant impairment of concentration. This was an unexplained leap in the reasoning process.

(iii) The review panel failed to explain why it found that the claimant had a significant impairment of concentration in light of the inconsistencies referred to above, and in light of the review panel's own findings on examination.

(iv) The review panel failed to explain why it concluded, on page 11, that the claimant's injuries had stabilised "given the time since the accident and the continued stability of symptoms" when in fact the review panel's apparent conclusion was that the claimant had deteriorated quite significantly since the assessment with Assessor Jager less than 8 months earlier.

(c) The Third Error - The decision was vitiated by legal unreasonableness (Minister for Immigration v Li (2013) 249 CLR 332; [2013] HCA 18) in that:

(i) no sensible review panel acting with due appreciation of its responsibilities would have assessed the claimant as having Class 3 impairment for "Concentration Persistence and Pace" in the circumstances where there were the inconsistencies set out at (a) above;

(ii) the review panel failed to give adequate weight to relevant factors of great importance;

a. That Dr Jager had found that the claimant's view of his concentration was more pessimistic than the reality.

b. That the claimant demonstrated no concentration deficits on examination.

(iii) the review panel reasoned illogically or irrationally;

a. As set out at (b) above.

And/or

(iv) the decision lacks evident and intelligible justification.

a. As set out at (b) above.

3. The review panel has committed error in law or fallen into jurisdictional error and/or it has constructively failed to exercise its jurisdiction in respect of each of or any of or a combination of the above grounds of judicial review and the review panel decision and certificate is accordingly invalid and it should be set aside.

  1. The errors relied upon for judicial review shall be referred to as grounds 1, 2 and 3, respectively, for each corresponding numbered error.

  2. The relief claimed was as follows:

  1. An order in the nature of certiorari or, alternatively, a declaration setting aside or declaring invalid the decision and/or medical assessment and Review Panel Certificate of the third defendant, the medical assessors review panel as was constituted by the SIRA, namely, the assessment dated 4 December 2018, made purportedly pursuant to ss 63 and 61 of the Act.

  2. An order in the nature of mandamus remitting the matters the subject of the review panel decision and the Review Panel Certificate to the SIRA for reallocation of the matter to a differently constituted medical assessors review panel for determination of the matter according to law.

  3. If necessary, an interim order or stay in the nature of prohibition or an interlocutory injunction preventing the defendants or any of them or their officers, servants or agents from acting on or taking any further step in reliance on the Review Panel Certificate until the final determination of these proceedings or until further order.

  4. Any such further or other order as the Court deems fit.

  5. Costs.

LEGISLATIVE SCHEME

  1. Section 131 of the Act provides that no damages may be awarded for non-economic loss unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor vehicle accident is greater than 10% (see also ss 58(1)(d) and 61(10) of the Act).

  2. Section 132(1) of the Act provides that, in the case of a dispute as to the degree of permanent impairment, a court may not award damages for non-economic loss unless the degree of permanent impairment has been assessed by a medical assessor under Pt 3.4 of the Act.

  3. Part 3.4 of the Act concerns “Medical assessment” and applies to a disagreement between a claimant and an insurer about whether the degree of permanent impairment of an injured person as a result of an injury caused by the motor vehicle accident is greater than 10% (s 58(1)). Hence, Pt 3.4 of the Act applied to the first defendant’s claim.

  4. Section 57 provides various definitions, inter alia, as follows:

  1. “medical assessment matters” are defined as meaning “any of the matters referred to in s 58”;

  2. “medical assessor” is defined as meaning “a person appointed under this Part to make an assessment under this Part”; and

  3. “medical dispute” means “a disagreement or issue to which this Part applies”.

  1. Section 57A provides:

57A Motor Accidents Medical Assessment Service

(1) The Authority is to establish in association with its operations a unit, to be known as the Motor Accidents Medical Assessment Service.

(2) The Service is to consist of medical assessors and such members of staff of the Authority as the Authority determines.

  1. Section 3 of the Act provides: “Authority means “the State Insurance Regulatory Authority constituted under the State Insurance and Care Governance Act 2015”.

  2. Section 58(1) applies to disagreements between a claimant and an insurer and is in the following terms:

58 Application

(1) This Part applies to a disagreement between a claimant and an insurer about any of the following matters (referred to in this Part as medical assessment matters):

(a) whether the treatment provided or to be provided to the injured person was or is reasonable and necessary in the circumstances,

(b) whether any such treatment relates to the injury caused by the motor accident,

(c) (Repealed)

(d) whether the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.

(e) (Repealed)

  1. Section 60(1) provides that a medical dispute may be referred to the MAS under the authority of the SIRA.

  2. Section 61 of the Act provides that the medical assessors to whom the medical dispute is referred are to give a certificate as to the matters referred for assessment. Assessors Newlyn, Roberts and Anderson had this obligation and issued a Review Panel Certificate on 28 March 2018 (“the Certificate”).

  3. Section 61(1), (2) and (10) provides as follows:

61 Status of medical assessments

(1) The medical assessor or assessors to whom a medical dispute is referred is or are to give a certificate as to the matters referred for assessment.

(2) Any such certificate as to a medical assessment matter is conclusive evidence as to the matters certified in any court proceedings or in any assessment by a claims assessor in respect of the claim concerned.

…

(10) The following procedure is to apply if the assessment of more than one medical assessor is required to assess whether the degree of permanent impairment of the injured person is greater than 10% (not being an assessment of the degree of permanent impairment resulting from psychiatric or psychological injury):

(a) each medical assessor is to give a certificate as to the degree of permanent impairment of the injured person resulting from the particular injury or injuries with which the medical assessor’s assessment is concerned,

(b) based on the matters certified in each such certificate a medical assessor nominated by the Authority for the purpose is to make an assessment of the total degree of permanent impairment resulting from all the injuries with which those certificates are concerned and is to give a certificate (a combined certificate) as to that total degree of permanent impairment,

(c) the combined certificate is conclusive evidence as to whether the degree of permanent impairment of the injured person is greater than 10% and this section applies to the combined certificate accordingly.

  1. Section 61(2) is subject to the provisions of s 63. Section 63(1) is extracted below:

63 Review of medical assessment by review panel

(1) A party to a medical dispute may apply to the proper officer of the Authority to refer a medical assessment under this Part by a single medical assessor to a review panel of medical assessors for review.(2) An application for the referral of a medical assessment to a review panel may only be made on the grounds that the assessment was incorrect in a material respect.

(2A) If a medical assessment under this Part (a combined certificate assessment) is based on the assessments of 2 or more single medical assessors (resulting in a combined certificate as to the total degree of permanent impairment), the combined certificate assessment cannot be the subject of review under this section except by way of the review of any of the assessments of the single medical assessors on which the combined certificate assessment is based.

(3) The proper officer of the Authority is to arrange for any such application to be referred to a panel of at least 3 medical assessors, but only if the proper officer is satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect having regard to the particulars set out in the application.

(3A) The review of a medical assessment is not limited to a review only of that aspect of the assessment that is alleged to be incorrect and is to be by way of a new assessment of all the matters with which the medical assessment is concerned.

(4) The review panel may confirm the certificate of assessment of the single medical assessor, or revoke that certificate and issue a new certificate as to the matters concerned.

(5) If on the review of a medical assessment of a single medical assessor on which a combined certificate assessment is based a new certificate is issued by the review panel, the review panel is also to issue a new combined certificate to take account of the results of the review.

(6) Section 61 applies to any new certificate or new combined certificate issued under this section.

(7) The Motor Accidents Medical Guidelines may limit the time within which an application under this section may be made.

  1. The first defendant correctly emphasised that in discharging its functions the third defendant is considering the assessment “a fresh” on the day of the assessment: Frost v Kourouche (2014) 86 NSWLR 214; [2014] NSWCA 39 (“Frost”) at [9].

  2. The Act provides for the making of guidelines with respect to medical assessments. Those guidelines were a focal point of the proceedings.

  3. As to the guidelines for the assessments conducted by medical assessors, s 44(1) provides:

44   Medical Guidelines of Authority

(1)  The Authority may issue guidelines (Motor Accidents Medical Guidelines) with respect to the following:

(a)  the appropriate treatment of injured persons,

(b)  the appropriate procedures with respect to the provision of rehabilitation services or attendant care services for injured persons (including the circumstances in which rehabilitation services or attendant care services are required to be provided),

(c)  the assessment of the degree of permanent impairment of an injured person as a result of an injury caused by a motor accident,

(d) the procedures for the referral of disputes for assessment or review of assessments, and the procedure for assessment and review of assessments, under Part 3.4.

(2)  The Authority may amend, revoke or replace Motor Accidents Medical Guidelines.

(3)  Motor Accidents Medical Guidelines may adopt the provisions of other publications, whether with or without modification or addition and whether in force at a particular time or from time to time.

(4)  Motor Accidents Medical Guidelines (including any amendment, revocation or replacement) are to be published in the Gazette and take effect on the day of that publication or, if a later day is specified in the Guidelines for that purpose, on the day so specified.

(5)  Motor Accidents Medical Guidelines:

(a)  are not to be construed as requiring medical treatment to be carried out in accordance with Motor Accidents Medical Guidelines, and

(b)  are to be consistent with a high standard of medical care, dental care, rehabilitation, aftercare and continuing care as exists in the community at that time.

(6)  Motor Accidents Medical Guidelines must be developed in consultation with relevant medical colleges, including the Royal Australasian College of Physicians, the Royal Australasian College of Surgeons, the Royal Australian College of General Practitioners, the Australian Orthopaedic Association, the para-medical professional associations and other relevant colleges and associations.

(7) Sections 40 (Notice of statutory rules to be tabled) and 41 (Disallowance of statutory rules) of the Interpretation Act 1987 apply to a guideline under this section in the same way as those sections apply to a statutory rule.

Editorial note.

For Guidelines issued pursuant to this section see Gazettes No 87 of 21.5.2004, p 3122; No 92 of 22.7.2005, p 3857; No 30 of 3.3.2006, p 1090; No 49 of 7.4.2006, p 2059; No 118 of 22.9.2006, p 8116; No 90 of 13.7.2007, p 4581; No 87 of 11.7.2008, p 7059 and No 111 of 9.12.2016, p 3369.

  1. Section 65 provides:

65 Authority monitoring and oversight

(1) Medical assessments under this Part are subject to relevant provisions of Motor Accidents Medical Guidelines relating to the procedures for the referral of disputes for assessment or review of assessments and the procedure for assessment.

(2) The Authority may arrange for the provision of training and information to medical assessors to promote accurate and consistent medical assessments under this Part.(3) A medical assessor is not subject to control and direction by the Authority or any Public Service employee with regard to any of the decisions of the assessor that affect the interests of the parties to a medical assessment, and the Authority or any Public Service employee may not overrule or interfere with any such decision of a medical assessor in respect of any such assessment.

  1. Section 133 provides:

133 Method of assessing degree of impairment

(1) The assessment of the degree of permanent impairment of an injured person as a result of the injury caused by a motor accident is to be expressed as a percentage in accordance with this Part.

(2) The assessment of the degree of permanent impairment is to be made in accordance with:

(a) Motor Accidents Medical Guidelines issued for that purpose, or

(b) if there are no such guidelines in force--the American Medical Association's Guides to the Evaluation of Permanent Impairment, Fourth Edition.

(3) In assessing the degree of permanent impairment under subsection (2)(b), regard must not be had to any psychiatric or psychological injury, impairment or symptoms, unless the assessment of the degree of permanent impairment is made solely with respect to the result of a psychiatric or psychological injury.

MOTOR ACCIDENT PERMANENT IMPAIRMENT GUIDELINES

The Guidelines

  1. The SIRA issued the Motor Accident Permanent Impairment Guidelines (effective 1 June 2018), with respect to motor accidents occurring between 5 October 1999 and 30 November 2017 (“the Guidelines”). They were Motor Accident Medical Guidelines for the purposes of s 44(1) of the Act. Section 133 provides that the assessment of permanent impairment is to be made in accordance with those guidelines. Further, ss 44(1)(d) and 65(1) of the Act provide that guidelines may establish procedures for the review of assessments made under Pt 3.4 of the Act.

  2. The Preamble to the Guidelines stated:

General introduction to the Permanent Impairment Guidelines…Under the MAC Act, damages for non-economic loss can only be awarded where the permanent impairment is greater than 10% and is the result of an injury caused by a motor accident. The assessment of the degree of permanent impairment of an injured person is to be made in accordance with these Guidelines.

These Guidelines are based on the American Medical Association’s Guides to the Evaluation of Permanent Impairment, Fourth Edition (third printing, 1995) (AMA4 Guides). The AMA4 Guides are widely used as an authoritative source for the assessment of permanent impairment, however these Guidelines make significant changes to the AMA4 Guides to align them with Australian clinical practice and to better suit the purposes of the MAC Act.

These Guidelines commence on 1 June 2018.

  1. Under the heading “Permanent Impairment”, there are four relevant headings: “Introduction”, “Application of Guidelines”, “Causation of Injury” and “Consistency”. Those aspects of the Guidelines are in the following terms:

Introduction

1.1 These Motor Accident Permanent Impairment Guidelines have been developed for the purpose of assessing the degree of permanent impairment arising from the injury caused by a motor accident, in accordance with Section 133(2)(a) of the Motor Accidents Compensation Act 1999 (NSW) (the Act).

1.2 These Guidelines are based on the American Medical Association’s Guides to the Evaluation of Permanent Impairment, Fourth Edition (third printing, 1995) (AMA4 Guides). However, there are some very significant departures from that document in these Guidelines. A medical assessor undertaking impairment assessments for the purposes of the Act must read these Guidelines in conjunction with the AMA4 Guides. These Guidelines are definitive with regard to the matters they address. Where they are silent on an issue, the AMA4 Guides should be followed. In particular, chapters 1 and 2 of the AMA4 Guides should be read carefully in conjunction with clauses 1.1 to 1.46 of these Guidelines. Some of the examples in the AMA4 Guides are not valid for the assessment of impairment under the Act. It may be helpful for medical assessors to mark their working copy of the AMA4 Guides with the changes required by these Guidelines.

Application of these Guidelines

1.3 These Guidelines apply under the Act to the assessment of the degree of permanent impairment that has resulted from an injury caused by a motor accident occurring between 5 October 1999 and 30 November 2017 (inclusive).

1.4 For accidents that occurred on or after 1 December 2017, ‘Part 6 of the Motor Accident Guidelines: Permanent impairment’ apply, as published by the State Insurance Regulatory Authority (the Authority).

Causation of injury

1.5 An assessment of the degree of permanent impairment is a medical assessment matter under Section 58 (1)(d) of the Act. The assessment must determine the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident. A determination as to whether the injured person’s impairment is related to the accident in question is therefore implied in all such assessments. Medical assessors must be aware of the relevant provisions of the AMA4 Guides, as well as the common law principles that would be applied by a court (or claims assessor) in considering such issues.

…

Evaluation of impairment

1.17 The medical assessor must evaluate the available evidence and be satisfied that any impairment:

1.17.1 is an impairment arising from an injury caused by the accident, and

1.17.2 is an impairment as defined in clause 1.9 above.

1.18 An assessment of the degree of permanent impairment involves three stages:

1.18.1 a review and evaluation of all the available evidence including:

• medical evidence (doctors’, hospitals’ and other health practitioners’ notes, records and reports)

• medico-legal reports

• diagnostic findings

• other relevant evidence

1.18.2 an interview and a clinical examination, wherever possible, to obtain the information specified in these Guidelines and the AMA4 Guides necessary to determine the percentage impairment, and

1.18.3 the preparation of a certificate using the methods specified in these Guidelines that determines the percentage of permanent impairment, including the calculations and reasoning on which the determination is based. The applicable parts of these Guidelines and the AMA4 Guides should be referenced.

…

Permanent impairment

1.20 Generally, when an impairment is considered permanent, the injuries will also be stabilised. However, there could be cases where an impairment is considered permanent because it is unlikely to change in future months regardless of treatment, but the injuries are not stabilised because future treatment is intended and the extent of this is not predictable. For example, for an injured person who suffers an amputation or spinal injury, the impairment is permanent and may be able to be assessed soon after the injury as it is not expected to change regardless of treatment. However, the injuries may not be stabilised for some time as the extent of future treatment and rehabilitation is not known.

1.21 The evaluation should only consider the impairment as it is at the time of the assessment.

1.22 The evaluation must not include any allowance for a predicted deterioration, such as osteoarthritis in a joint many years after an intra-articular fracture, as it is impossible to be precise about any such later alteration. However, it may be appropriate to comment on this possibility in the impairment evaluation report.

Non-assessable injuries

1.23 Certain injuries may not result in an assessable impairment covered by these Guidelines and the AMA4 Guides. For example, uncomplicated healed sternal and rib fractures do not result in any assessable impairment.

Impairments not covered by these Guidelines and the AMA4 Guides

1.24 A condition may present that is not covered in these Guidelines or the AMA4 Guides. If objective clinical findings of such a condition are present, indicating the presence of an impairment, then assessment by analogy to a similar condition is appropriate. The medical assessor must include the rationale for the methodology chosen in the impairment evaluation report.

Adjustment for the effects of treatment or lack of treatment

1.25 The results of past treatment (for example, operations) must be considered since the injured person is being evaluated as they present at the time of assessment.

1.26 Where the effective long-term treatment of an injury results in apparent, substantial or total elimination of a physical permanent impairment, but the injured person is likely to revert to the fully impaired state if treatment is withdrawn, the medical assessor may increase the percentage of WPI by 1%, 2% or 3% WPI. This percentage must be combined with any other impairment percentage using the ‘Combined values’ chart (pages 322–324, AMA4 Guides). An example might be long-term drug treatment for epilepsy. This clause does not apply to the use of analgesics or anti-inflammatory drugs for pain relief.

1.27 For adjustment for the effects of treatment on a permanent psychiatric impairment, refer to clauses 1.222 to 1.224 under ‘Mental and behavioural disorders’ within these Guidelines.

1.28 If an injured person has declined a particular treatment or therapy that the medical assessor believes would be beneficial, this should not change the impairment estimate. However, a comment on the matter should be included in the impairment evaluation report.

1.29 Equally, if the medical assessor believes substance abuse is a factor influencing the clinical state of the injured person, a comment on the matter should be included in the impairment evaluation report.

Adjustment for the effects of prostheses or assistive devices

1.30 Whenever possible, the impairment assessment should be conducted without assistive devices, except where these cannot be removed. The visual system must be assessed in accordance with clauses 1.242 to 1.243 in these Guidelines.

Pre-existing impairment

1.31 The evaluation of the permanent impairment may be complicated by the presence of an impairment in the same region that existed before the relevant motor accident. If there is objective evidence of a pre-existing symptomatic permanent impairment in the same region at the time of the accident, then its value must be calculated and subtracted from the current WPI value. If there is no objective evidence of the pre-existing symptomatic permanent impairment, then its possible presence should be ignored.

1.32 The capacity of a medical assessor to determine a change in physical impairment will depend upon the reliability of clinical information on the pre-existing condition. To quote the AMA4 Guides (page 10): ‘For example, in apportioning a spine impairment, first the current spine impairment would be estimated, and then impairment from any pre-existing spine problem would be estimated. The estimate for the pre-existing impairment would be subtracted from that for the present impairment to account for the effects of the former. Using this approach to apportionment would require accurate information and data on both impairments.’ Refer to clause 1.218 for the approach to a pre-existing psychiatric impairment.

1.33 Pre-existing impairments should not be assessed if they are unrelated or not relevant to the impairment arising from the motor accident.

Subsequent injuries

1.34 The evaluation of permanent impairment may be complicated by the presence of an impairment in the same region that has occurred subsequent to the relevant motor accident. If there is objective evidence of a subsequent and unrelated injury or condition resulting in permanent impairment in the same region, its value should be calculated. The permanent impairment resulting from the relevant motor accident must be calculated. If there is no objective evidence of the subsequent impairment, its possible presence should be ignored.

Psychiatric impairment

1.35 Psychiatric impairment is assessed in accordance with ‘Mental and behavioural disorders’ within these Guidelines.

Psychiatric and physical impairments

1.36 Impairment resulting from a physical injury must be assessed separately from the impairment resulting from a psychiatric or psychological injury.

…

Consistency

1.40 Tests of consistency, such as using a goniometer to measure range of motion, are good but imperfect indicators of the injured person’s efforts. The medical assessor must use the entire gamut of clinical skill and judgement in assessing whether or not the results of measurements or tests are plausible and relate to the impairment being evaluated. If, in spite of an observation or test result, the medical evidence appears not to verify that an impairment of a certain magnitude exists, the medical assessor should modify the impairment estimate accordingly, describe the modification and outline the reasons in the impairment evaluation report.1.41 Where there are inconsistencies between the medical assessor’s clinical findings and information obtained through medical records and/or observations of non-clinical activities, the inconsistencies must be brought to the injured person’s attention; for example, inconsistency demonstrated between range of shoulder motion when undressing and range of active shoulder movement during the physical examination. The injured person must have an opportunity to confirm the history and/or respond to the inconsistent observations to ensure accuracy and procedural fairness.

[Emphasis added.]   

  1. There are a number of entries under the heading “Mental and behavioural disorders”, which are relevant. Under the sub-heading “Introduction” the following entries appear:

1.201 Psychiatric disorders have complex effects on the individual, and impairment must be assessed by a psychiatrist.

1.202 The AMA4 Guides do not give percentages of psychiatric impairment in Chapter 14 (pages 291–302), which deals with mental and behavioural disorders. Medically determinable impairments in thinking, affect, intelligence, perception, judgement and behaviour are difficult to translate into functional limitations.

1.203 The assessment of mental and behavioural disorders must be undertaken in accordance with the psychiatric impairment rating scale (PIRS) as set out in these Guidelines. Chapter 14 of the AMA4 Guides (pages 291–302) is to be used for background or reference only.

  1. Under “Assessment of mental and behavioural disorders” the following entries appear:

1.213 The impairment must be attributable to a psychiatric diagnosis recognised by the current edition of the Diagnostic & Statistical Manual of Mental Disorders (DSM) or the current edition of the International Statistical Classification of Diseases & Related Health Problems (ICD). The impairment evaluation report must specify the diagnostic criteria on which the diagnosis is based.

…

1.217 The scale must be used by a properly trained medical assessor. The psychiatrist’s clinical judgement is the most important tool in the application of the scale. The impairment rating must be consistent with a recognised psychiatric diagnosis, and based on the psychiatrist’s clinical experience.

…

  1. The plaintiff drew particular attention to cl 1.219.5, which appears under the heading, “The psychiatric impairment rating scale”. Extracted below are cll 1.219 and 1.220:

1.219 Behavioural consequences of psychiatric disorders are assessed on six areas of function, each of which evaluates an area of functional impairment:

1.219.1 self-care and personal hygiene (Table 11)

1.219.2 social and recreational activities (Table 12)

1.219.3 travel (Table 13)

1.219.4 social functioning (relationships) (Table 14)

1.219.5 concentration, persistence and pace (Table 15)

1.219.6 adaptation (Table 16).

1.220 Impairment in each area of function is rated using class descriptors. Classes range from 1 to 5 according to severity. The standard form (Figure 2) must be used when scoring the PIRS. The classes in each area of function are described through the use of common examples. These are intended to be illustrative rather than literal criteria. The medical assessor should obtain a history of the injured person’s pre-accident lifestyle, activities and habits, and then assess the extent to which these have changed as a result of the psychiatric injury. The medical assessor should take into account variations in lifestyle due to age, gender, cultural, economic, educational and other factors.

  1. The Guidelines provide tables referred to in the psychiatric impairment rating scale. Table 11 concerns “Self-care and personal hygiene” and is extracted below:

Table 11: Psychiatric impairment rating scale (PIRS)

Self-care and personal hygiene

Class 1

No deficit, or minor deficit attributable to normal variation in the general population

Class 2

Mild impairment. Able to live independently and look after self adequately, although may look unkempt occasionally. Sometimes misses a meal or relies on takeaway food.

Class 3

Moderate impairment. Cannot live independently without regular support. Needs prompting to shower daily and wear clean clothes. Cannot prepare own meals, frequently misses meals. Family member or community nurse visits (or should visit) 2–3 times per week to ensure minimum level of hygiene and nutrition.

Class 4

Severe impairment. Needs supervised residential care. If unsupervised, may accidentally or purposefully hurt self.

Class 5

Totally impaired. Needs assistance with basic functions, such as feeding and toileting.

  1. Table 15, which corresponds to cl 1.219.5, concerns “Concentration, persistence and pace” and is extracted below:

Table 15: Psychiatric impairment rating scale (PIRS)

Concentration, persistence and pace

Class 1

No deficit, or minor deficit attributable to normal variation in the general population. Able to operate at previous educational level; for example, pass a TAFE or university course within normal timeframe.

Class 2

Mild impairment. Can undertake a basic retraining course, or a standard course at a slower pace. Can focus on intellectually demanding tasks for up to 30 minutes; for example, then feels fatigued or develops headache.

Class 3

Moderate impairment. Unable to read more than newspaper articles. Finds it difficult to follow complex instructions; for example, operating manuals, building plans, make significant repairs to motor vehicle, type detailed documents, follow a pattern for making clothes, tapestry or knitting.

Class 4

Severe impairment. Can only read a few lines before losing concentration. Difficulties following simple instructions. Concentration deficits obvious even during brief conversation. Unable to live alone, or needs regular assistance from relatives or community services.

Class 5

Totally impaired. Needs constant supervision and assistance within an institutional setting.

  1. As to the calculation of psychiatric impairment, the Guidelines provide as follows:

1.225 Rating psychiatric impairment using the PIRS is a three-step procedure:

1.225.1 Determine the median class score.

1.225.2 Calculate the aggregate score.1.225.3 Convert the median class and aggregate score to % WPI.

1.226 Determining the median class score: Each area of function described in the PIRS is given an impairment rating ranging from class 1 to class 5. The six class scores are arranged in ascending order using the standard form (Figure 2). The median class is then calculated by averaging the two middle scores. For example:

Example

Impairment rating

Median class

A

1, 2, 3, 3, 4, 5

= 3

B

1, 2, 2, 3, 3, 4

= 2.5 = 3

C

1, 2, 3, 5, 5, 5

= 4

  1. Table 17 is “Conversion table” and is extracted below:

Table 17: Conversion table

  1. The following “Explanatory note” accompanied the above table:

Conversion table – Explanatory notes

1. Distribution of aggregate scores:

• The lowest aggregate score that can be produced is 1 + 1 + 1 + 1 + 1 + 1 = 6.

• The highest score that can be produced is 5 + 5 + 5 + 5 + 5 + 5 = 30.

• Table 17 therefore has aggregate scores ranging from 6 to 30.

• Each median class score has a range of possible aggregate scores and hence a range of possible impairment scores (for example, class 3 = 11% – 30% WPI).

• Table 17 distributes the impairment percentages across the possible range of aggregate scores. 2. Same aggregate score in different classes:

• Table 17 shows that the same aggregate score leads to different impairment percentages for different median classes. For example, an aggregate score of 18 is equivalent to an impairment rating of: - 10% in class 2 - 22% in class 3, and- 34% in class 4

• This is because the injured person whose impairment is in median class 2 is likely to have a lower score across most areas of function. The injured person may be significantly impaired in one aspect of their life, such as travel, yet have low impairment in social function, self-care or concentration. In contrast, someone whose impairment reaches median class 4 will experience significant impairment across most aspects of their life.

The Former Guidelines

  1. The plaintiff also placed reliance on the former guidelines dated 10 October 2007. Those guidelines were entitled “Permanent Impairment Guidelines” and were issued by the Motor Accidents Authority (“MAA”) (“the former Guidelines”).

  2. The former Guidelines were introduced by an “Explanatory Note” in which it was stated:

Explanatory Note

These Motor Accidents Authority (MAA) Guidelines are issued pursuant to section 44(1)(c) of the Motor Accidents Compensation Act 1999 ("the Act") and apply in respect of a motor accident occurring on or after 5 October 1999. These Guidelines replace the MAA "Guidelines for the assessment of the degree of permanent impairment of an injured person" published in Government Gazette No 92 of 22 July 2005 at page 3858.

The Act requires that damages for non-economic loss only be awarded where the permanent impairment of the injured person caused by the motor accident is greater than 10%. Further, the assessment of the degree of permanent impairment is to be made in accordance with the MAA Medical Guidelines issued for that purpose.

These Guidelines have been developed to fulfil that role. They use the American Medical Association Guides to the Evaluation of Permanent Impairment, Fourth Edition, Third Printing (1995) (AMA 4 Guides) as their basis. The AMA 4 Guides are widely used as an authoritative source for the assessment of permanent impairment. However, these MAA Guidelines make significant changes to the AMA 4 Guides to align them with Australian clinical practice and to better suit them to the purposes of the Act…

  1. There was an “Introduction” to the former Guidelines which was a counterpart to the Guidelines (see cll 1.1-1.2). Under that heading to the former Guidelines, the following appeared:

Introduction

1.1 These MAA Guidelines have been developed for the purpose of assessing the degree of permanent impairment arising from the injury caused by a motor accident, in accordance with section 133(2)(a) of the New South Wales Motor Accidents Compensation Act 1999.

1.2 The MAA Guidelines are based on the American Medical Association publication "Guides to the Evaluation of Permanent Impairment", 4th Edition, 3rd Printing (1995) (AMA 4 Guides). However, in these Guidelines there are some very significant departures from that document Persons undertaking impairment assessments for the purposes of the NSW Motor Accidents Compensation Act 1999 must read these MAA Guidelines in conjunction with the AMA 4 Guides. These MAA Guidelines are definitive with regard to the matters they address. Where they are silent on an issue, the AMA 4 Guides should be followed. In particular, Chapters 1 and 2 of the AMA 4 Guides should be read carefully in conjunction with this Chapter of the MAA Guidelines. Some of the examples in AMA 4 are not valid for the assessment of impairment under the Motor Accidents Compensation Act 1999. It may be helpful for assessors to mark their working copy of the AMA 4 Guides with the changes required by these MAA Guidelines.

1.3 The convention used in these MAA Guidelines is that if the text is in bold, it is a directive as to how the assessment should be performed.

  1. Under the subheading “Application of Guidelines” the following appeared:

1.4 Original Assessments

- These Guidelines apply to all assessments of the degree of permanent impairment (under s58(1)(d) of the Act) conducted by a medical assessor on or after the commencement date.

1.5 Further Assessments

- These Guidelines apply to a further medical assessment of the degree of permanent impairment (under s62 of the Act) conducted by a medical assessor on or after the commencement date.

If an original assessment under s58(1)(d) was conducted under a previous version of these Guidelines resulting in a certificate being issued that the claimant's injuries exceed the WPI threshold, an application may not be made under s62 for a further assessment if it is based solely on a change made in these Guidelines.

  1. Under the subheading “Consistency” the former Guidelines provided:

1.42 Tests of consistency, such as using a goniometer to measure range of motion, are good but imperfect indicators of claimants' efforts. The assessor must utilise the entire gamut of clinical skill and judgement in assessing whether or not the results of measurements or tests are plausible and relate to the impairment being evaluated. If, in spite of an observation or test result, the medical evidence appears not to verify that an impairment of a certain magnitude exists, the assessor should modify the impairment estimate accordingly, describing the modification and outlining the reasons in the impairment evaluation report.

1.43 Where there are inconsistencies between the assessor's clinical findings and information obtained through medical records and/or observations of non-clinical activities, the inconsistencies should be brought to the claimant's attention, e. g. inconsistency demonstrated between range of shoulder motion when undressing and range of active shoulder movement during the physical examination. The claimant will then have an opportunity to confirm the history and/or respond to the inconsistent observations to ensure accuracy and procedural fairness.

[Original emphasis.]

  1. The plaintiff contended the following differences are apparent between the Guidelines and the former Guidelines:

  1. As to paragraph titled “Consistency”, whilst the wording is largely the same, in the former Guidelines cl 1.43 provided: “The inconsistencies should be brought to the claimant’s attention”, whereas in the Guidelines, cl 1.41 provides: “The inconsistencies must be brought to the claimant’s attention”.

  2. Further, in the former Guidelines, cl 1.43 stated: “The claimant will then have an opportunity to confirm the history…”. Under the Guidelines, cl 1.41 states that “[t]he injured person must have an opportunity to confirm the history...”.

  3. In the former Guidelines, cl 1.2 is bolded, whereas in the Guidelines any bolding has been removed. The Guidelines no longer have “bold” and “unbolded” sections.

  4. It was submitted that the Guidelines are more emphatic and mandatory, as opposed to the former Guidelines, with respect to the aforementioned use of the word “must” rather than “should” and the emboldening of the words.

  1. As to the more emphatic and mandatory nature of the words “must” in cl 1.41 of the Guidelines rather than “should” in cl 1.43 of the former Guidelines, the plaintiff referred to Dominice v Allianz Australia Insurance Ltd (2017) 81 MVR 249; [2017] NSWCA 171 (“Dominice”) at [61], in which the plaintiff submitted that cl 1.43 of the Guidelines exists as a safeguard against the drawing of unfair conclusions that may affect either party’s interest, particularly in circumstances where there are discrepancies between a claimant’s presentation to different medical assessors. The provisions of cl 1.43 were to ensure procedural fairness.

  2. The plaintiff then made reference to the judgment of Simpson JA (with whom Emmett AJA agreed), concerning cl 1.43, in Dominice at [61] and [70]:

[61] Clause 1.43 offers a guard against the drawing, unfairly, of conclusions about inconsistencies detected in a claimant’s presentation. It can also, as in the present case, act as a guard against conclusions that may be unfairly drawn in favour of a claimant, against the interests of an insurer, where the conclusions (as here) are unsupported by medical records or history. In order to make a proper assessment, Dr Ashwell needed to investigate the discrepancies between Ms Dominice’s presentation to Dr Kenna 10 months earlier and her presentation to him, as well as the inconsistencies he noted in her presentation to him. It was the drawing of the conclusion, in the face of inconsistent medical records and without exploration or explanation, that caused the proper officer to have the requisite satisfaction that there was reasonable cause to suspect that Dr Ashwell’s assessment was incorrect in a material respect. No error in the primary judge’s conclusion in this respect was established. Ground 1 of the appeal was rejected.

...

[70] The submission placed undue weight upon Dr Ashwell’s conclusion, at the expense of his reasoning process (which was not disclosed in the report). Dr Ashwell noted inconsistencies in presentation. He (apparently) made no attempt to explore them with Ms Dominice. He merely put them aside in stating (not reaching) his conclusion. It was there that cl 1.43 had its part to play. It may very well have been that, had Dr Ashwell engaged Ms Dominice with respect to the inconsistencies, he would not have been able to state the conclusion that he did. That is the potential material error on which the proper officer formed her satisfaction.

  1. The first defendant sought to distinguish Dominice in the present proceedings. I will return to this issue.

  2. As to the relevance of emboldened words in the former Guidelines and, in particular, the absence of emboldening in the Guidelines, the plaintiff referred to Boyce v Allianz Australia Insurance Ltd (2018) 96 NSWLR 356; [2018] NSWCA 22 (“Boyce”), specifically, the statement of Basten JA at [18], which concerned cl 1.2 of the former Guidelines:

[18] This last statement is ambiguous in two respects. First, in some legal contexts, provisions are described as “mandatory or directory.” However, in the Guidelines it is clear that a “directive” is mandatory. There is then a question as to the use of the term “definitive”. If the Guidelines are “definitive” only with respect to matters in bold type, there is potential confusion as to the meaning of s 133(2) which requires that the assessment “is to be made in accordance with” the Guidelines. However, the purpose of cl 1.2 and cl 1.3 of the Guidelines is to fix the relationship of the Guidelines with the AMA 4 Guides. The purpose of placing certain parts of the text in bold is that the AMA 4 Guides are not to be followed on such matters. It would be inconsistent with the combination of s 133(2) and the mandatory terms in which parts of the unbolded text are expressed to suggest that the assessor can ignore what is, in effect, the bulk of the Guidelines. The point may be illustrated by two consecutive paragraphs under the head “Permanent impairment”:

“1.23 The evaluation should only consider the impairment as it is at the time of the assessment.

1.24 The evaluation should not include any allowance for a predicted deterioration … .”

Although the latter provision is not bolded, it is in its terms mandatory.

[Footnotes omitted.]

(His Honour referred (at footnote 14) in that respect to Ali v AAI Ltd (2016) 757 MVR 502; [2016] NSWCA 110 (“Ali”) at [93]-[99]).

  1. The plaintiff submitted that non-bolded words in the former Guidelines may still be mandatory if their terms say they are. The plaintiff submitted that, in the Guidelines, the result of removing the emboldening is that if the terms are mandatory in their nature, then the Guidelines will stipulate as such (see Boyce at [18]-[19]).

  2. In the result, the plaintiff submitted that the Guidelines are “mandatory” with respect to cl 1.41 by the use of the word “must” rather than “should”.

  3. Further, the plaintiff submitted the consequence of a failure to comply or adhere to the Guidelines when expressed in mandatory terms can, depending on the facts of the case, constitute a failure to perform a statutory function or a constructive failure to exercise jurisdiction.

MAS GUIDELINES

  1. Pursuant to s 44(1)(d) of the Act, the MAA published Medical Assessment Guidelines, with respect to the procedures for the referral of disputes for assessment or review of assessments, and the procedure for assessments and Review Panel assessments under Pt 3.4 of the Act. Those guidelines shall hereinafter be referred to as “the MAS Guidelines”.

  2. The MAS Guidelines commence by setting out the objects at cll 1.13 and 1.14 as follows:

1.13 The objects of MAS set out in clause 1.14 should be used as an aid to the interpretation of these Guidelines.

1.14 The objects of MAS in dealing with medical disputes referred are:

1.14.1 to provide a timely, fair and cost effective system for the assessment of medical disputes under the Motor Accidents Compensation Act 1999 that is accessible, transparent, independent and professional;

1.14.2 to assess medical disputes fairly and according to the substantial merits of the application with as little formality and technicality as is practicable and minimising the cost to the parties;

1.14.3 to ensure the quality and consistency of MAS decision making;

1.14.4 to make appropriate use of the knowledge and experience of MAS Assessors; and 1.14.5 to establish and maintain effective communication and liaison with stakeholders concerning the role of MAS.

  1. Permanent impairment dispute are referred to in cl 13.5 as follows:

No combined certificate required

13.5 An Assessor to whom a permanent impairment dispute is referred requiring either a psychiatric or psychological injury assessment, or requiring a physical injuries assessment by a single Assessor, that does not require the issuing of a combined certificate, is to send to MAS a certificate certifying:

13.5.1 the list of the injuries referred and whether they were each found to have been caused by the accident;

13.5.2 the degree of permanent impairment of the injured person as a result of each of those injuries referred that were found to be caused; and

13.5.3 whether the degree of permanent impairment of the injured person as a result of those injuries referred that were found to be caused, is greater than 10%.

  1. The arrangements for Review Panel assessment appear in cl 16.21. Clause 16.24 provides:

16.21 The Review Panel is to hold an initial meeting or teleconference within 30 days of the date the panel was convened and, at that meeting or in subsequent meetings, is to:

16.21.1 consider afresh all aspects of the assessment under review;

16.21.2 determine whether re-examination of the claimant is required, and if so set a timetable for that to occur;

16.21.3 determine whether additional information is required in order to make a decision;

16.21.4 determine whether each of the certificates issued by the original Assessor is to be confirmed or revoked;

16.21.5 if revoked, determine what new certificates are to be issued;

16.21.6 where the original assessment certificate was issued under clause 13.7 and included in a combined certificate under clause 13.9, determine whether the panel is to issue a new combined certificate, combining the result of the review with the results of the other assessments included in that combined certificate; 16.21.7 determine which member of the panel will sign any certificates on behalf of the panel;

16.21.8 determine whether a further meeting of the panel is required; and

16.21.9 advise the Proper Officer of any determinations under this clause

THE ASSESSMENT BY ASSESSOR JAGER

  1. Assessor Jager’s assessment of the first defendant’s current functions was as follows:

Current Functioning

He is independent in his self-care and personal hygiene. He shaves, showers and wears fresh clothes and unclothes without prompting. Previously he and his wife went to parks, the Mingarra Club and occasionally to an Argentinean barbeque. He now occasionally goes to the Mingarra Club but his Wife has to push him to go. They recently attended the Club to see a Beatles band, which he liked. He is anxious in the car and avoids driving it when he can and almost always takes his Wife with him. He hasn't lost any friendships but he lacks the motivation to go out socially. He has remained very close to his wife and children and only sometimes argues with his wife. He used to love movies but if there is Violence he stops watching. On the internet he can do a search, eg to find plants for his garden successfully. He recently learnt how to diagnose a problem with a lemon tree and was able to transplant it. His estimate of his concentration is more pessimistic than the real deficit. He makes empanadas (Argentinean pasties) in his kitchen at home but is not efficient as he was pervious [sic] to the accident. He said he has to ''fight" to get things done.

  1. Further, the plaintiff’s submission that it has demonstrated that the findings of the third defendant were not within the scope of the authority conferred upon it, in my view, have real substance.

  2. However, the Court should be slow to find a decision of the kind under review was legally unreasonable. In this case it is unnecessary to do so, having regard to the conclusions reached for grounds 1 and 2.

JURISDICTIONAL ERROR

  1. The first defendant contended that the alleged errors do not constitute a constructive failure to exercise jurisdiction or any other kind of jurisdictional error.

  2. The submissions of the first defendant in that respect may be briefly outlined as follows:

  1. Jurisdictional error is a “failure to comply with one or more statutory preconditions or conditions to an extent which results in a decision which has been made in fact lacking characteristics necessary for it to be given force and effect by the statute pursuant to which the decision-maker purported to make it” (Hossain at [24]). It is an expression of the gravity of an error (Hossain at [25]). A decision made in breach of a condition to be observed in the course of a decision-making process, implied by statute, is not necessarily invalid. There is generally a threshold of materiality in the event of non-compliance (see Hossain at [29]; and SZMTA at [45]). For an error to be jurisdictional, there must be “a material breach of an express or implied condition of the valid exercise of a decision-making power conferred by” an Act (Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22; [2015] HCA 51 at [23]; Hossain at [31]).

  2. None of the alleged breaches (if established) were relevantly material.

  1. It may be reiterated, in that respect, that the first defendant did not press a submission that alleged errors did not appear on the face of the record.

Consideration: Jurisdictional Error

  1. For the plaintiff to establish its case and so to enliven the Court's power to issue remedies it must establish an error of law on the face of the record (the "record" is the written reasons – see, s 69(3) and (4) of the Supreme Court Act 1970 (NSW)). Errors of law on the face of the record need not be errors going to jurisdiction: see, Garcia v MAA (2009) 54 MVR 102; [2009] NSWSC 1056 at [21]-[24] and the discussion in Kirk v Industrial Court of New South Wales (2010) 239 CLR 531; [2010] HCA 1 at [78]-[90] and also [66]-[70].

  2. The first defendant properly did not pursue its submission that the errors that the plaintiff alleged here were, if established, not apparent on the face of the record.

  3. In any event, I note that In Pham v NRMA Insurance Ltd (2014) 66 MVR 152; [2014] NSWCA 22 at [27] it was held (per Leeming JA, with Tobias AJA agreeing) that both a claims assessor's certificate and reasons form part of the record, by reason of the statute requiring reasons to be given. The plaintiff correctly submitted that MAS Assessors' reasons form part of the record, for the same reason, in that the obligation to give reasons is in the Act: s 61(9).

  4. I have found error of law on the face of the record with regard to grounds 1 and 2.

  5. In those circumstances, it is strictly unnecessary to consider whether the errors which I have found are jurisdictional errors. However, I note that, as to the issue of jurisdictional error, the plaintiff has pleaded that the errors include a constructive failure to exercise jurisdiction. The Court of Appeal in Rodger v De Gelder (2015) 71 MVR 514 said (at [95] per Gleeson JA, with Macfarlan and Leeming JJA agreeing):

[95] … Jurisdictional error includes a constructive failure to exercise jurisdiction. A constructive failure to exercise jurisdiction arises when a decision-maker misunderstands the nature of its jurisdiction and, in consequence, applies a wrong test, misconceives its duty, fails to apply itself to the real question to be decided, or misunderstands the nature of the opinion it is to form: Minister for Immigration v Yusuf at [41] (Gaudron J).

  1. Indeed, the Court of Appeal in Boyce per Basten JA at [9], [14]-[22], [41], [44], [49]-[51], [66] (Macfarlan JA agreeing) (see also [108] per Sackville AJA); Rutland at [10] (per McColl and Meagher JJA, with Macfarlan JA agreeing) has found that the Guidelines have statutory force and a failure to comply with the Guidelines can constitute a constructive failure to exercise jurisdiction.

  2. Here the errors alleged by the plaintiff heed to the exercise of power by the third defendant and, in particular, breach of conditions which the statute expressly or impliedly required to be observed. They represent a constructive failure to exercise jurisdiction.

  3. The third defendant was required by statute to give reasons: ss 63(6) and 61(9) of Act. A failure to do so also represents an error of law on the face of the record.

  4. The first defendant placed reliance upon Hossain. Particular reliance was placed upon [24] and [25] of that judgment. I extract [23]-[29] below:

[23] Jurisdiction, in the most generic sense in which it has come to be used in this field of discourse, refers to the scope of the authority that is conferred on a repository. In its application to judicial review of administrative action the taking of which is authorised by statute, it refers to the scope of the authority which a statute confers on a decision-maker to make a decision of a kind to which the statute then attaches legal consequences. It encompasses in that application all of the preconditions which the statute requires to exist in order for the decision-maker to embark on the decision-making process. It also encompasses all of the conditions which the statute expressly or impliedly requires to be observed in or in relation to the decision-making process in order for the decision-maker to make a decision of that kind. A decision made within jurisdiction is a decision which sufficiently complies with those statutory preconditions and conditions to have “such force and effect as is given to it by the law pursuant to which it was made”.

[24] Jurisdictional error, in the most generic sense in which it has come to be used to describe an error in a statutory decision-making process, correspondingly refers to a failure to comply with one or more statutory preconditions or conditions to an extent which results in a decision which has been made in fact lacking characteristics necessary for it to be given force and effect by the statute pursuant to which the decision-maker purported to make it. To describe a decision as “involving jurisdictional error” is to describe that decision as having been made outside jurisdiction. A decision made outside jurisdiction is not necessarily to be regarded as a “nullity”, in that it remains a decision in fact which may yet have some status in law.23 But a decision made outside jurisdiction is a decision in fact which is properly to be regarded for the purposes of the law pursuant to which it was purported to be made as “no decision at all”. To that extent, in traditional parlance, the decision is “invalid” or “void”.

[25] To return to the explanation of Professor Jaffe, jurisdictional error is an expression not simply of the existence of an error but of the gravity of that error. In the language of Selway J, the unavoidable distinction between jurisdictional errors and non-jurisdictional errors is ultimately “a distinction between errors that are authorised and errors that are not; between acts that are unauthorised by law and acts that are authorised”.

[26] Although ultimately correct in the result, the majority in the Full Court was therefore wrong to distinguish between a decision involving jurisdictional error and a decision wanting in authority. They are one and the same.

[27] Just as identification of the preconditions to and conditions of an exercise of decision-making power conferred by statute turns on the construction of the statute, so too does discernment of the extent of non-compliance which will result in an otherwise compliant decision lacking the characteristics necessary to be given force and effect by the statute turn on the construction of the statute. The question of whether a particular failure to comply with an express or implied statutory condition in purporting to make a particular decision is of a magnitude which has resulted in taking the decision outside the jurisdiction conferred by the statute cannot be answered except by reference to the construction of the statute.

[28] The common law principles which inform the construction of statutes conferring decision-making authority reflect longstanding qualitative judgments about the appropriate limits of an exercise of administrative power to which a legislature can be taken to adhere in defining the bounds of such authority as it chooses to confer on a repository in the absence of affirmative indication of a legislative intention to the contrary. Those common law principles are not derived by logic alone and cannot be treated as abstractions disconnected from the subject matter to which they are to be applied. They are not so delicate or refined in their operation that sight is lost of the fact that “[d]ecison-making is a function of the real world”.

[29] That a decision-maker “must proceed by reference to correct legal principles, correctly applied” is an ordinarily (although not universally) implied condition of a statutory conferral of decision-making authority. Ordinarily, a statute which impliedly requires that condition or another condition to be observed in the course of a decision-making process is not to be interpreted as denying legal force and effect to every decision that might be made in breach of the condition. The statute is ordinarily to be interpreted as incorporating a threshold of materiality in the event of non-compliance.

  1. For the reasons I have discussed earlier, the “breaches” (the error found in Grounds 1 and 2) are relevantly material.

RELIEF

  1. The question is whether there is established relevant error of law on the face of the record that warrants quashing the decision, should that step be determined to be taken in the Court’s discretion. That is the nature of judicial review proceedings as distinct from an appeal or review on questions of law, fact or discretion.

  2. The first defendant submitted that, should the Court find that the third defendant made any error concerning the application of cl 1.41 of the Guidelines, it should decline to grant relief in its discretion. This is because cl 1.41 is primarily intended to benefit a claimant and ensure that the claimant is afforded procedural fairness. The first defendant contended that he had made no complaint about the third defendant’s application of that clause. Further, the first defendant submitted that the plaintiff should not be granted relief where any failure of compliance of the Guidelines did not directly affect it. The further amended summons, it was contended, should be dismissed.

  3. Having regard to the purpose of cl 1.41 of the Guidelines as discussed in Dominice, my findings as to the proper operation of the provision, the circumstances of this matter as discussed in this judgment and the materiality of the errors of law by the third defendant, I do not accept those submissions.

  4. An orders in the nature of certiorari should be made quashing the decision of the third defendant and an order should be made in the nature of mandamus remitting the matters the subject of the third defendant’s decision to the SIRA for reallocation to a Medical Assessors Panel for determination of the matter according to law.

  5. Both parties agreed that costs should follow the event. I shall make orders against the first defendant accordingly, noting my conclusions below as to the Suitors’ Fund.

SUITORS’ FUND APPLICATION

  1. Following the conclusion of proceedings, the first defendant filed submissions dated 5 August 2020 seeking the grant of a certificate under the Suitors’ Fund, in the event the plaintiff was successful on its appeal, pursuant to the Suitors’ Fund Act 1951 (NSW) (“the SF Act”). The first defendant sought the following order:

The first defendant to be granted an indemnity certificate under the Suitors Fund Act 1951 (NSW) if eligible.

  1. The first defendant’s submissions were brief and are extracted in full below:

1. If the plaintiff’s summons is not [sic] successful, the first defendant hereby makes an application that in addition to the usual order as to costs, there should be ordered a certificate under the Suitors’ Fund Act 1951 (NSW).

2. Under that fund, the NSW Attorney General may award the respondent up to $10,000 for participating in these judicial review proceedings (section 6C(2) of the Suitors’ Fund Act 1951 (NSW)).

3. A certificate under the Suitors Fund was issued to an unsuccessful individual litigant in, for example, motor accidents judicial review cases in similar circumstances in:

- Allianz Australia Insurance Ltd v Ward (2010) 79 NSWLR 657 at [82] and [83] (Hidden J) (claims assessor);

- GIO v Smith (No 2) [2011] NSWSC 998 at [9], [13] and [14](Hoeben J)(1 September 2011) (medical assessors review panel);

- Insurance Australia Limited t/as NRMA Insurance v Banos (No 2) [2013] NSWSC 1668 (Campbell J) (claims assessor);

- IAG Ltd v Riley (2013) 64 MVR 191; [2013] NSWSC 684 (Davies J)(medical assessors review panel);

- Allianz Australia Insurance Ltd v Tarabay (2013) 62 MVR 537; [2013] NSWSC 141 (Rothman J) (claims assessor); and

- CIC Allianz Australia Limited v Daniel Luke McDonald (2012) 61 MVR 382 (Hidden J) (claims assessor).

4. The decision under review here was a decision of the medical assessors review panel, made after a clinical examination of the first defendant and receiving submissions of the two opposing parties (the insurer and the claimant). The decision-maker is properly regarded as a quasi-judicial tribunal and, in essence a “court” within the definition of that word in section 2(1) of the Suitors’ Fund Act 1951 (NSW). Section 2 of the Act defines “court” to include “such tribunals or other bodies as are prescribed”. The regulations have not prescribed a tribunal or other body as a court. In Australian Postal Commission v Dao (No. 2) (1986) 6 NSWLR 497 at 513-514, Kirby P said of the Equal Opportunity Tribunal:

“It would seem unlikely, given the history and the purpose of the Suitors’ Fund Act 1951, the increase since its enactment in the number and kind of statutory tribunals and the relationship established between the Tribunal and the Supreme Court, that appeals should lie on questions of law but not attract the protection of the Suitors’ Fund Act because the Tribunal is not a court.”

5. In Dao at 516 McHugh JA said after observing the liberal construction by courts of the word “appeal” in the Act, that:

“The word ‘court’ should likewise be given a liberal and beneficial construction to accord with the purpose and policy of the Act. The correct approach is for the Court to ask itself whether, bearing in mind the general purpose of the Suitors’ Fund Act, Parliament must be taken to have intended that the Tribunal should qualify as a court? I think that the question should be answered in the affirmative. Whether the Tribunal is a ‘court’ for purposes other than the Act is beside the point.”

6. Consistent with this beneficial interpretation of the Act, the following tribunals have been held for the purposes of the Act to be courts;

- The Equal Opportunity Tribunal: Dao, supra;

- The Government and Related Employees Appeal Tribunal: Reid v Sydney City Council (1995) 35 NSWLR 719 and Commissioner of Corrective Services v Government and Related Employees Appeal Tribunal [2004] NSWCA 337;

-The Full Bench of the Industrial Relations Commission: Moama Bowling Club Limited v Armstrong (No 2) (1995) 64 IR 264 (application under s.6(1A));

- The Medical Disciplinary Tribunal and its successors: Qidwai v Brown [1984] 1 NSWLR 100, Walton v McBride (1995) 36 NSWLR 440, Macarthur v Walton (unreported; NSWCA; Priestley, Handley & Powell JJA; 31 August 1995), and Health Care Complaints Commission v A Medical Practitioner [2001] NSWCA 158

- The Consumer Traders and Tenancy Tribunal: Krslovic Homes v Sparkes [2004] NSWSC 374, Rural and General Insurance v Fair Trading Tribunal [2004] NSWSC 396, and Burringbar Real Estate Centre Pty Ltd v Ryder [2008] NSWSC 891.

- Strata Titles Board: Anderson Stuart v Treleaven [2000] NSWSC 536;

- The Administrative Decisions Tribunal: Trust Company of Australia Ltd v Skiwing Pty Ltd (2006) 68 NSWLR 366, [2006] NSWCA 387 at [74].

- The Registrar of the Supreme Court: Tisdale v Ballanday [2009] NSWSC 56 at 158 (see the paper by Valentino Musico, CSO Senior Solicitor, 11 August 2010 titled “The Suitors’ Fund Act 1951”).

7. See also the Court of Appeal’s decision in Lou v IAG Limited t/as NRMA Insurance [2019] NSWCA 319 at [63] and [85] where many of these principles were discussed and a decision of a SIRA claims assessor (determining damages or exemptions) was held to constitute a decision of a “court or tribunal” and the claimant was entitled to a certificate under the Suitors’ Fund.

8. Here, it was reasonable for the first defendant to have defended these proceedings and to oppose the testing of the validity of the tribunal’s decision here and a Suitors Fund direction should be made, if the first defendant is eligible.

  1. I accept the submission of the first defendant that it was not unreasonable for the first defendant to have defended the judicial review proceeding brought by the plaintiff and that an indemnity certificate under the SF Act should be issued to ameliorate hardship.

ORDERS

  1. The plaintiff shall bring in short minutes of order reflecting this judgment within 7 days of the publication of this judgment.

Decision last updated: 10 August 2020

Most Recent Citation
Cases Citing This Decision

8

Allianz Australia Insurance Limited v Bell [2025] NSWCA 187
QBE Insurance (Australia) Limited v Nadine Sedger [2023] NSWSC 865
Flanagan v Allianz Australia Insurance Ltd [2022] NSWSC 1374
Cases Cited

47

Statutory Material Cited

6

AB v Judicial Commission of New South Wales (Conduct Division) [2018] NSWCA 264
AB v Judicial Commission of New South Wales (Conduct Division) [2018] NSWCA 264
Ali v AAI Limited [2016] NSWCA 110