Insurance Australia Limited t/as NRMA Insurance v Haneen Asfour

[2024] NSWSC 605

Supreme Court

New South Wales

Medium Neutral Citation:

Insurance Australia Limited t/as NRMA Insurance v Haneen Asfour [2024] NSWSC 605

Hearing dates:

16 May 2024

Date of orders:

16 May 2024

Decision date:

16 May 2024

Jurisdiction:

Common Law

Before:

Campbell J

Decision:

(1) A freezing order in accordance with annexure A within the Notice of Motion filed on 15 May 2024.

(2) The Statement of Claim, Notice of Motion, affidavits in support and the freezing order be served upon the defendant by midday on 17 May 2024.

(3) An order for short service of a subpoena to produce documents on the National Australia Bank in the form annexed to the affidavit of Mr Vid Dragomirovic dated 6 May 2024 and marked “Y”.

(4) The subpoena is to be served on the National Australia Bank no later than 5pm on 17 May 2024 and is to be returnable before the court at 9am on Thursday, 23 May 2024.

(5) This motion to be listed for further orders and directions before the Common Law duty judge at 10am on Tuesday, 21 May 2024.

(6) Reserve the question of costs.

(7) The plaintiff to have liberty to apply ex parte, on application to my Associate, on Friday, 17 May 2024, in the event that any difficulty is encountered in effecting personal service.

Catchwords:

CIVIL PROCEDURE – interim preservation – freezing orders – fraudulent CTP personal injury claim – forged medical invoices – brazen fraud – prima facie cause of action established – necessity of freezing order to prevent frustration of court’s process – freezing order granted

Legislation Cited:

Motor Accidents Injuries Act 2017 (NSW), s 6.42

Uniform Civil Procedure Rules 2005 (NSW), r 25.14

Cases Cited:

Frigo v Culhaci [1998] NSWCA 88

Category:

Procedural rulings

Parties:

Insurance Australia Limited trading as NRMA Insurance (Plaintiff)
Haneen Asfour (Defendant)

Representation:

Counsel:
J Catsanos SC (Plaintiff)
No appearance (Defendant)

Solicitors:
Meridian Lawyers (Plaintiff)

File Number(s):

2024/178109

ex tempore JUDGMENT (revised)

1. I am dealing with an application for freezing order under r 25.14 of the Uniform Civil Procedure Rules 2005 (NSW). The application is made by notice of motion filed on 15 May 2024 in proceedings commenced by statement of claim on 14 May 2024. Neither the statement of claim nor the notice of motion has been served upon the defendant, the prospective judgment debtor.

2. The plaintiff is an insurance company who is also an authorised insurer to issue compulsory third party insurance policies under the Motor Accident Injuries Act 2017 (NSW) (the “MAIA”). The defendant is a person who claims to have been injured in a motor accident occurring on or about 4 December 2022.

3. The accident happened on the M4 Motorway at Prospect. It seems to have been a multi-vehicle collision, and the defendant's case or claim was that she suffered personal injury when her vehicle was struck from behind by a vehicle insured by the plaintiff. She lodged a claim under the MAIA, and in accordance with its statutory obligations, the plaintiff accepted liability and extended statutory benefits to the defendant in accordance with its requirements.

4. I am informed by Mr Catsanos SC who appears for the plaintiff today that the defendant has now taken the steps necessary to initiate an action or a claim for common law damages as modified by the legislation.

5. The plaintiff's claim against the defendant is one for damages in the tort of deceit, and a statutory claim for the repayment of a financial benefit in the sum of $380,594.60 obtained by the defendant on the basis of misleading or deceptive statements or conduct in making her claim. That statutory cause of action is created by the provisions of s 6.42(1) and (2) of the MAIA.

6. In support of the application for the freezing order, Mr Catsanos has read the affidavit of his instructing solicitor Mr Vid Dragomirovic sworn on 6 May 2024; the affidavit of Dr Geoffrey Needham, a medical practitioner specialising in pain management, affirmed 4 May 2024; and the affidavit of Anthea Aphrodite Stylianakis, a clinical psychologist employed by NSW Health, sworn 15 March 2024.

7. The gravamen of the claim against the defendant is that she falsely produced or procured someone to falsely produce a series of invoices for medical treatment that she did not receive from Dr Needham, and for counselling which she did not receive from Ms Stylianakis. Together, the amounts involved are large. The sum paid in respect of the forged invoices attributable to Dr Needham is in the order of $96,381, while the amount attributable to the forged invoices for psychological treatment falsely said to have been given by Ms Stylianakis is in the order of $136,843.40.

8. There are also other expenses in relation to domestic duties and other assistance in the activities of daily life totalling $11,977. There are further amounts totalling in excess of $200,000 where the defendant claimed reimbursement for additional amounts she had allegedly paid to Dr Needham and Ms Stylianakis, and for other services relating to the activities of daily living including being driven to and from medical appointments which appear not to have taken place.

9. Although the amount claimed in the statement of claim is as I have stated it to be, Mr Dragomirovic says that the sums paid in respect of those matters now total $446,050.44. From the evidence attached to his affidavit, there is a question about whether the statutory benefits for lost earnings paid to the defendant were properly paid, but I leave that to one side for the moment.

10. Having considered very carefully the affidavits of Dr Needham and Ms Stylianakis as well as that of Mr Dragomirovic’s, I am satisfied that there is good prospect of the plaintiff establishing the causes of action to which I have referred. Indeed, I would regard the case on the materials available to me and bearing in mind I have not heard from the defendant, as a clear case of a brazen fraud.

11. There is compelling evidence from Dr Needham that he saw the plaintiff on only one occasion after the car accident. He did treat her previously for an unrelated condition and having examined the invoices and other documents attributed to him, he strongly says that they are not his documents. Until he was shown them by the solicitors for the plaintiff, he had never seen them before.

12. Ms Stylianakis's evidence is to the same effect. Indeed, her evidence is perhaps even more compelling in one sense because first, as I have said, she is employed by NSW Health and has no private practice. Secondly, while she did treat the defendant in her employed capacity in 2021, she has not been consulted by the defendant following the motor vehicle accident. Indeed, on her affidavit, the first time she became aware of the defendant’s injury relevant to this matter at all is when she was approached by the regulator in relation to an investigation into the claim lodged by the defendant.

13. Under r 25.14(4) UCPR, the court may make a freezing order against a prospective judgment debtor if the court is satisfied having regard to all the circumstances that there is a danger that a judgment or prospective judgment will be wholly or partly unsatisfied because, amongst other things, that either the judgment debtor may abscond or he or she will dispose of or otherwise deal with his or her assets so that they are significantly diminished in value.

14. Normally, in accordance with authority, the Court exercises a degree of caution in making a freezing order. It is regarded as an exceptional interlocutory remedy. As the Court of Appeal pointed out in Frigo v Culhaci [1998] NSWCA 88 at p 6:

"Its function is to minimise the possibility of an unscrupulous defendant seeking to render himself or herself 'Judgment proof' by taking steps to ensure that no assets within the jurisdiction can be found on the day of judgment.”

15. The purpose of the order is not to provide security to the plaintiff but to protect the processes of the court. The Court of Appeal said that the general rule is that the plaintiff will need to establish at p 6:

"[f]irst, a prima facie cause of action against the defendant, and secondly, a danger that, by reason of the defendant's absconding, or of assets being removed out of the jurisdiction or disposed of within the jurisdiction or otherwise dealt with in some fashion, the plaintiff, if he succeeds, will not be able to have his judgment satisfied.”

16. I have already referred to the consideration that the plaintiff here has established a prima facie cause of action. Indeed, while the evidence before me is untested, it has established more than that as I have already indicated. Although in some cases, it may be difficult for a plaintiff to prove the second condition upon which the exercise of a discretion depends, a plaintiff's task is made easier when the cause of action relied upon is one of fraud, supported by cogent evidence as in the present case.

17. Where the evidence as here establishes the defendant has engaged in an elaborately planned fraud involving a large amount of money, it is easy for the court to conclude that there is a real risk that she is an unscrupulous defendant, and that she will seek to dispose of the proceeds of her fraud and other assets to make herself “judgment proof” unless restrained by appropriate ancillary orders of the court. I am satisfied this is such a case and that the order ought to be made.

18. So far as that is concerned, I am satisfied from the affidavit evidence that appropriate disclosure has been made in accordance with the relevant rules and practice note, as well as in accordance with the plaintiff's obligation to the court when proceeding ex parte. It does not seem on the material before me that the defendant has any real or viable defence, although there is no reason to suppose that the motor accident itself did not take place.

19. So far as the evidence discloses, it seems that the defendant was a person who may previously have been bankrupt, but she is not an undischarged bankrupt, and while there is no evidence from which I could suppose she would abscond, that is not the only question for my consideration.

20. I think absent an order, she could readily remove or dispose of the financial benefit she has obtained by withdrawing money from bank accounts or opening other bank accounts which may not necessarily be easily traced. It is fair to say that in his affidavit, Mr Dragomirovic has pointed out that the evidence suggests that she is a single mother of four children, although he is unaware of her domestic circumstances and whether the children in fact reside with her.

21. As I have said, the plaintiff paid the defendant a statutory benefit and continues to do so in the sum of $2,113.72 per fortnight after tax which is $1,056.86 per week net. It is conceded that the defendant ought to have access to this sum, as provided for in the proposed usual form of order at paragraph 10(a). Other concessions are made in paragraph 10, including for the payment of reasonable legal expenses. I note in particular that the plaintiff has given the usual undertaking as to damages in the form required in Schedule A, paragraph 1 and has made the other undertakings required in the usual form of order. It is unnecessary for me to set these matters out in any more detail.

22. For these reasons I make the following orders:

1. A freezing order in accordance with annexure A within the Notice of Motion filed on 15 May 2024.

2. The Statement of Claim, Notice of Motion, affidavits in support and the freezing order be served upon the defendant by midday on 17 May 2024.

3. An order for short service of a subpoena to produce documents on the National Australia Bank in the form annexed to the affidavit of Mr Vid Dragomirovic dated 6 May 2024 and marked Y.

4. The subpoena is to be served on the National Australia Bank no later than 5pm on 17 May 2024 and is to be returnable before the court at 9am on Thursday, 23 May 2024.

5. This motion to be listed for further orders and directions before the Common Law duty judge at 10am on Tuesday, 21 May 2024.

6. Reserve the question of costs.

7. The plaintiff to have liberty to apply ex parte, on application to my Associate, on Friday, 17 May 2024, in the event that any difficulty is encountered in effecting personal service.

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Decision last updated: 20 May 2024