Insurance Australia Ltd t/as NRMA Insurance v Proietti

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Insurance Australia Ltd t/as NRMA Insurance v Proietti [2022] NSWPIC 298
CLAIMANT:	Ivana Proietti
INSURER:	Insurance Australia Ltd t/as NRMA Insurance
PRINCIPAL MEMBER:	John Harris
DATE OF DECISION:	2 June 2022
CATCHWORDS:	MOTOR ACCIDENTS - Ms Proietti was injured in a motor accident on 7 November 2018 when the insured vehicle reversed, striking and causing her to fall to the ground; the Insurer denied the claim for payment of the future costs of a knee replacement and injections into the lumbar spine; the parties accepted that the payment of future medical expenses did not constitute a medical assessment matter and did not contest the decision in Obeid v AAI Ltd; they jointly sought to have the matter determined as a miscellaneous claim as there was a liability dispute between the parties which fell within the meaning of schedule 2 clause 3(n) of the Motor Accidents Injury Act 2017; the Commission dismissed the claim as it was not satisfied it had jurisdiction despite the common submission; R v Moore applied; Ex parte Australian Workers’ Union applied; submission that the making of the order created the liability rejected, as an order cannot be made in the absence of a power; Maxcon Constructions Pty Ltd v Vadasz (No 2) referred to; insurer’s submission that the Motor Accident Guidelines (Guidelines) provided the underlying statutory entitlement to recover future expenses dismissed because the provision does not exist in the legislation and the Guidelines otherwise did not provide a statutory entitlement and create a potential liability with the insurer; otherwise submissions directed to those statutory provisions and/or Guidelines which concerned treatment approved by an insurer did not provide a statutory entitlement to an injured person where there had been a denial of treatment and the expenses had not been incurred; Held – matter dismissed due to absence of jurisdiction to make the order sought.
DETERMINATIONS MADE:	The miscellaneous claims assessment matter is dismissed pursuant to s 54 of the Personal Injury Commission Act 2020.

REASONS

BACKGROUND

Ms Ivana Proietti (the claimant) suffered injuries in a motor vehicle accident on 7 November 2018. The motor accident occurred when the insured vehicle reversed, striking Ms Proietti and causing her to fall to the ground.
The insurer insured the owner and driver of the motor vehicle for liability to pay to
Ms Proietti any damages and/or statutory compensation entitlements under the Motor Accident Injuries Act 2017 (the MAI Act).
On 16 November 2018 Ms Proietti completed a claim form stating that she suffered injuries to her right knee, back and right hip in the motor accident.

PREVIOUS ASSESSMENT

Medical Assessor Kenna provided a medical assessment certificate dated 27 February 2020. The Medical Assessor concluded that the need for a transforaminal corticosteroid injection to the L5/S1 level of the lumbar spine relates to the motor accident, was reasonable and necessary, and will improve the recovery of the claimant.

PRESENT DISPUTE

Ms Proietti was treated for her low back injury by Dr Anil Nair, surgeon. Dr Nair opined that Ms Proietti suffered injuries in the motor accident to the L5/S1 disc and L5/S1 retrolisthesis.[1]
[1] Claimant’s bundle, page 80.
In 2019 Dr Nair recommended a corticosteroid injection. That treatment was the subject of an assessment by Medical Assessor Kenna. Dr Nair subsequently noted that this treatment accorded significant relief.[2]
[2] Claimant’s bundle, page 81.
In a report dated 2 February 2021, Dr Nair noted that the previous injection provided only temporary relief and recommended radiofrequency ablation.[3]
[3] Claimant’s bundle, page 82.
On 16 April 2021 the insurer denied a request for the payment of a lumbar dorsal root ganglion radiofrequency ablation and epidural corticosteroid injection requested by
Dr Nair.
Dr Jonathan Herald, orthopaedic surgeon, treated Ms Proietti for her right knee injury. In his initial report, Dr Herald recommended an arthroscopy and partial medial meniscectomy.[4] That surgery was undertaken in late April 2019. The surgery showed a medial meniscal tear of the posterior horn and medial femoral chondral damage.[5]
[4] Claimant’s bundle, page 58.
[5] Claimant’s bundle, page 75.
Following an initial recovery, Dr Herald noted progressive medial compartment osteoarthritis. In May 2020, Dr Herald recommend a unicompartmental knee replacement as the “only real surgical solution”.[6] That recommendation was delayed in the latter part of 2020 due to an improvement of symptoms.
[6] Claimant’s bundle, page 70.
On 17 June 2021 the insurer denied the claimant’s request for unicompartmental knee replacement.
The insurer’s denials were based on an opinion expressed by Dr Raymond Wallace, orthopaedic surgeon, rather than an examination of all medical evidence including the treating evidence served by Ms Proietti.
On 22 September 2021 the insurer filed an application with the Personal Injury Commission (the Commission) for the determination of the treatment and permanent impairment disputes. No steps were taken to progress these matters in circumstances where no internal reviews had been undertaken by the insurer.
On 5 April 2022 a Medical Review Panel issued reasons in Obeid v AAI Ltd.[7] That Panel concluded that there was an absence of jurisdiction by a Review Panel to determine a medical dispute where no liability has been incurred in connection with the provision of treatment and care.
[7] [2022] NSWPICMP 76 (Obeid).
The medical dispute discussed in Obeid is contained in Schedule 2 cl 2(b) of the MAI Act and relevantly provides:
“[W]hether any treatment and care provided to the injured person is reasonable and necessary in the circumstances or relates to the injury caused by the motor accident for the purposes of section 3.24 (Entitlement to statutory benefits for treatment and care).”
That medical dispute refers to s 3.24 of the MAI Act which relevantly provides:
“(1) An injured person is entitled to statutory benefits for the following expenses
(treatment and care expenses) incurred in connection with providing treatment and care for the injured person -
(a)the reasonable cost of treatment and care.”
The Panel then concluded that the section was limited to the expenses of treatment incurred in providing treatment and care and did not extend to the payment of future expenses. Reference was made to the decision of AAI Ltd v Moon[8] where Wright J defined ‘incurred’, in a different context of the MAI Act, to mean an “actual liability to pay”.
[8] [2020] NSWSC 714 at [110]-[111].
Following that decision, the insurer sought to have the claim for treatment expenses determined as a miscellaneous claims assessment matter by reason of Schedule 2,
cl 3(n) of the MAI Act. That provision relevantly provides:
“The following matters are declared to be miscellaneous claims assessment matters for the purposes of Part 7 –
…
(n) any issue of liability for a claim, or part of claim, for statutory benefits not otherwise specified in this Schedule.”
The matter was listed for telephone conference on 26 May 2022. Mr Boitano then appeared for the claimant and Ms Watts for the insurer. The purpose of that conference was to hear submissions on whether the Commission had jurisdiction to hear the dispute as a miscellaneous claims matter.
At the telephone conference the parties accepted that the following material would be referred to for the purposes of the determination of the question of jurisdiction:
(a)    Reply filed by the claimant to a “Treatment and WPI Dispute”;
(b)    submissions filed by the insurer dated 3 May 2022, and
(c)    submission filed by the claimant dated 18 May 2022.

SUBMISSIONS

The insurer filed written submissions dated 3 May 2022.
On 18 May 2022 the claimant filed a short submission in the Commission portal adopting and agreeing with the insurer’s submissions “that the treatment dispute ought to be considered as a miscellaneous dispute”.
During the oral submissions the insurer stated that it was not challenging the correctness of Obeid. It submitted that the matter could be considered a miscellaneous claims matter despite Obeid being correctly decided. At the telephone conference the parties were given leave to address the issue concerning the statutory basis for the insurer’s liability to pay expenses not yet incurred. Subsequent written submissions were filed on 30 May 2022.

FINDINGS

A tribunal is not bound by submissions on statutory construction provided the parties are provided with procedural fairness: Coleman v Power.[9] The parties otherwise cannot create or consent to jurisdiction: R v Moore; Ex parte Australian Workers’ Union.[10]
[9] [2004] HCA 39 at [243].
[10] (1976) 11 ALR 449 at 453. See also Australian Education Union v Lawler [2008] FCAFC 135 at [185].
Statutory benefits are payable under Part 3 of the MAI Act even if the motor accident was caused by the fault of the driver of the vehicle (s 3.1). The types of statutory benefits are funeral expenses (Division 3.2), weekly payments (Division 3.3) and treatment and care expenses (Division 3.4).
Treatment and care expenses are not payable as a component of any damages that may be awarded (s 4.3). Damages are restricted to non-economic loss (Division 4.3) and specific categories of economic loss (Division 4.2).
The insurer’s liability to pay treatment and care expenses arises under s 3.24 of the MAI Act which is set out earlier.
Schedule 2 provides how various matters are classified for the purposes of Part 7 of the MAI Act. The Schedule is split into three areas, “Merit review matters”, “Medical assessment matters” and “Miscellaneous claims assessment matters”.
The classifications in the Schedule do not create a statutory entitlement but specifies who will determine the dispute. Accordingly, the reference in Schedule 2, cl 3(n) to any “issue of liability for a claim, or part of claim, for statutory benefits not otherwise specified in this Schedule” must depend upon an entitlement arising under the MAI Act.
In its initial written submissions, the insurer referred to s 7.40 of the MAI Act which defines the term “dispute” to mean “a dispute between a claimant and an insurer about a Miscellaneous Claims Assessment matter”. The dispute can be referred to the Commission by either party (s 7.42). The insurer’s argument in its written submissions was encapsulated in the following submission:[11]
“It is respectfully submitted that the question whether the expenses had been incurred is not determinative as to whether the Commission has the jurisdiction to determine[d] the dispute as a Miscellaneous Claims matter. Rather, the dispute which the Commission must determine is whether there is any liability. It is that liability which is determined by way of Miscellaneous Claims Assessment. Once the Commission determined the matter and it is found there was liability for those statutory benefits the expense would be ‘incurred’ as the insurer would then be ‘… under a present liability to make the relevant payment’.”
[11] Insurer’s written submissions, [6].
The question of statutory construction is determined by reference to the text, context and purpose of the Act: Project Blue Sky Inc v Australian Broadcasting Authority[12] and Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue.[13]
[12] [1998] HCA 28 [69]-[71].
[13] [2009] HCA 41 (Alcan).
I accept that the concept of “liability” in Schedule 2 cl 3(n) would extend to any accrued liability for statutory benefits under the MAI Act.
The meaning of the word must be construed in accordance with its context within the provision.
Clause 3(n) provides a “catch all” for any liability disputes not referenced in cls 1, 2 or 3 of Schedule 2. The surrounding words refer to “any issue of liability for a claim” (emphasis added). Those words must refer to any accrued liability which vest at the time of the claimant’s injury. To that extent, a claim for statutory benefits under the MAI Act is akin to the obligations of employers under workers compensation legislation to pay similar benefits.
The employer’s liability under workers’ compensation legislation arises at the time of injury. In Orica Ltd v CGU Insurance Ltd Spigelman CJ, when discussing issues of indemnity for policies of insurance, observed:[14]
“The cases determine that the liability to pay compensation arose immediately upon injury, because s 7(1), as properly construed, created a legal obligation arising at that time.
The rights of the worker, and the correlative obligations of the employer, were expressed in different terms in the various cases, but to the same effect. For example, ‘the rights and liabilities are vested’ in the words of Rainbow J from Dwyer v Broken Hill South Ltd (1928) 2 WCR 209, quoted with approval by Street CJ in Australian Iron & Steel v Coal Mines Insurance (at 50 – 51; 91-92); and there is ‘a vested right to compensation’ at the time of injury (at 55). The question is when can it be said that there are ‘rights in law’ (Ogden Industries Pty Ltd v Lucas (1968) (Privy Council) (at 38) or an ‘accrued right’ or ‘accrued liability’ (Fisher v Hebburn (at 202-203 especially at 203.9); Western Pastoral Co v Eyeington (1971) 125 CLR 342 at 352; Dillingham Engineering Pty Ltd (at 586C-587B); TNT Aust Pty Ltd v Horne (1995) 36 NSWLR 630 at 637B-F).”
[14] [2003] NSWCA 331 at [30] - [31].
Similarly, s 3.1 of the MAI Act creates a liability to pay statutory benefits at the time of injury.
The issue is the statutory basis of the insurer’s liability to pay for treatment which has not been provided or no liability for the treatment has been incurred.
The insurer submitted that an order of the Commission determining the issue in favour of the claimant would mean that “the expense would be ‘incurred’ as the insurer would then be ‘… under a present liability to make the relevant payment’”.[15] That submission adopts the meaning of “incurred” ascribed by the Court in AAI Ltd v Moon.[16]
[15] Insurer’s initial submissions, [6].
[16] [2020] NSWSC 714 at [110]-[111].
However, the insurer’s submission is circular and purports to create the power to make the order from the order itself. An order simply cannot be made in the absence of a power. As Hinton J stated in Maxcon Constructions Pty Ltd v Vadasz (No 2)[17] after referring to the plurality in Kirk v Industrial Court of New South Wales:[18]
“It follows that where an administrative decision maker is invested with power by statute, as in this case, the limits of the decision maker’s powers are to be found in the statute.”
[17] [2017] SASCFC 2 at [274].
[18] [2010] HCA 1 at [68].
The insurer accepted the correctness of Obeid. The Panel’s reasoning in Obeid turned upon the absence of a statutory power in s 3.24 when it held that this provision did not provide a basis for the making of an order against the insurer.
The parties were advised at the telephone conference that the basis of the insurer’s submission that there was a liability to pay for treatment and care not incurred was unclear. Leave was granted to the parties to consider this issue as I was not prepared to accept, on the submissions then made, that there was jurisdiction to hear the claim as a miscellaneous claims assessment matter.
The further submissions filed following the telephone conference emphasised that the issue was one of “liability”, presumably by reference to Schedule 2, cl 3(n) of the MAI Act. It referred to the objects of the MAI Act contained in s 3, specifically;
(a) to encourage early and appropriate treatment and care to encourage optimum recovery of injured persons (s 1.3(2)(a)), and
(b) to encourage the early resolution of motor accident claims and to encourage the quick, cost, efficient and just resolution of disputes
(s 1.3(2)(g)).
The insurer noted that an interpretation of a provision of the MAI Act or the Regulations which promotes the objects of the Act is to be preferred to a construction that would not promote those objects[19] and a person exercising a discretion must do so in a way which best promotes the objects of the MAI Act or of the relevant provision.[20]
[19] Section 1.3(4) of the MAI Act.
[20] Section 1.3(5) of the MAI Act.
The insurer noted that s 10.2(1) of the MAI Act provides for the making of Guidelines with respect to any matter required or authorised under the MAI to be provided for by the making of Guidelines.
The insurer noted that the Regulations “do not address an insurer’s liability to pay statutory benefits for treatment and care expenses” but that the “Guidelines do so in detail”.[21]
[21] Insurer’s further submissions, paragraph 3(f).
The insurer then referred to cls 4.73 to 4.105 of the Guidelines with particular reference to cls 4.73, 4.74, and 4.95 to 4.98. In both its initial submissions and further submissions, the insurer expressed particular reliance on cl 4.98 of the Guidelines which sets out the insurer’s obligations where there has been a request for treatment and care services. Clause 4.98 provides:
“Where the insurer receives the claimant’s request for treatment, rehabilitation, vocational support and attendant care services, it must advise the claimant and service provider in writing of its decision as soon as possible but within 10 days of receipt of the request, and
(a) if approved:
• state the costs the insurer has agreed to meet
• pay the account as soon as possible but within 20 days of receipt of an invoice or expense
• advise the claimant of the insurer’s obligation to pay all reasonable and necessary costs and expenses – including travel expenses to attend approved treatment, rehabilitation services or assessments, including all services or assessments conducted by a medical assessor of the Personal Injury Commission – as soon as possible (no later than 20 days after receiving the account or request for reimbursement).
(b) if declined, in whole or in part, provide:
• the reasons for the decision with reference to the information relied upon in making the decision.
• a list of all information relevant to the decision, regardless of whether the information supports the decision, including copies of all listed information
• an explanation of the insurer’s internal review process, including the timeframe in which an application for internal review must be made and/or right to make an application to the Personal Injury Commission
• information on how a claimant may make a complaint with the Independent Review Office (IRO), including the IRO’s contact details.”
The insurer referred to that part of cl 4.98(b) which provides that the insurer is to provide an explanation of the “right to make an application to the Personal Injury Commission” when the claim for treatment and care services has been declined.
The insurer submitted in its initial submissions that “the Guidelines would not have proposed a right to make application to the Personal Injury Commission to determine that dispute if the Commission did not have jurisdiction to do so”.[22]
[22] Insurer’s initial written submissions, paragraph 8.
The insurer otherwise referred to s 3.17 of the MAI Act which provided that an insurer could require a claimant to undertake reasonable and necessary treatment and could suspend weekly payments if the claimant, without reasonable excuse, did not comply with the insurer’s requirement.
The insurer contended that these various provisions meant that an insurer had a “liability” for future medical expenses which promoted the objects of the MAI Act.
The further submissions had particular regard to treatment approved by the insurer.
It is abundantly clear from the objects and various provisions of the MAI Act and the Guidelines that an insurer has a right to approve treatment and care. Indeed, as the insurer identified, various consequences flow from a claimant failing to undergo reasonable and necessary treatment. Once the treatment had been approved by the insurer, it is arguable that the expenses have been “incurred” as there is an actual liability to pay. However, the present issue is not where the insurer has approved the treatment expense but where it has denied the expense and the statutory basis by the injured person to enforce an entitlement for payment.

I am prepared to accept the insurer’s submission that pursuant to s 1.3(4) of the MAI Act, the question of construction must be approached in a manner which promotes the objects of the MAI Act in respect of the construction of the Guidelines even though that provision refers to the Act or the Regulations and not to the Guidelines.[23] This is because the Guidelines are made pursuant to s 10.2 of the MAI Act and arguably should be interpreted consistently with the objects of the Act.
[23] There is no exercise of discretion when undertaking the task of construing whether there is a power. The insurer’s reference to s 1.3(5) of the MAI Act is irrelevant and can be disregarded.
I have reservations, that the Guidelines may provide a statutory basis for the payment of future treatment and care. The reservations are that the Guidelines issued pursuant to s 10.2 are limited in scope by reference to various categories. Section 10.4(3) provides that Guidelines may be issued on medical assessment matters which are defined to include “matters relating to the appropriate treatment of injured persons”. It is difficult to accept that the Guidelines provide the underlying statutory entitlement for future expenses when such a provision does not exist in the legislation.
Most of the insurer’s submissions are directed to clauses in the Guidelines which refer to treatment which has been approved by the insurer.
Clauses 4.73 and 4.74 of the Guidelines refer to treatment approved by the insurer before a claim has been made. Clauses 4.95 to 4.97 relate to the insurer facilitating the claimant’s request to an appropriate treatment provider or otherwise accepting the claimant’s request to be referred to a provider of his or her choice.
Otherwise, s 3.17 of the MAI Act refers to an insurer requiring a claimant to undergo reasonable and necessary treatment and the effects if the claimant does not comply with any reasonable direction.
None of these provisions provide a statutory entitlement to the injured person where there has been a denial of treatment and the expenses have not been incurred.
The possible exception to this conclusion is the reference to that part of cl 4.98(b) where the claim has been declined and the insurer is required to explain the “right to make an application to the Personal Injury Commission”. This part of the clause assumes that there is a possible power by the Commission to determine the claim. On any plain reading, that clause does not provide a statutory entitlement and does not create a potential liability by the insurer where no such entitlement exists in the MAI Act.
As noted above, I otherwise do not accept that the various provisions in the MAI Act provide a statutory right for a claimant to enforce an entitlement for future treatment expenses which have not been incurred.
In these circumstances I am not satisfied that there is any issue of “liability for a claim” within the meaning of Schedule 2 cl 3(n) of the MAI Act where the expenses have not been incurred because there is no statutory entitlement vested in the injured person.

ORDERS

As the Panel noted in Obeid, the “extent of statutory benefits [payable to an injured person] are issues of policy and are matters for the legislature”.[24]
[24] Obeid at [82].
For these reasons, the Commission does not have jurisdiction to determine this as a miscellaneous claim assessment matter where liability to pay for the treatment has not been incurred. That part of the application is dismissed pursuant to s 54 of the Personal Injury Commission Act 2020 as otherwise misconceived or lacking in substance.
I observe that the insurer has otherwise filed an application for the assessment of the claimant’s permanent impairment as a medical assessment matter. The insurer noted that it filed the application with the Commission and there was no requirement to have an internal review, if it filed the application.[25]
[25] See s 7.19 of the MAI Act.
The terms of s 7.19 contrasts with s 7.11 of the MAI Act (merit review matters) which provides that a merit review application “may not be made” if an internal review has not been undertaken.
The restriction of filing an application with the Commission before an internal review is undertaken applies to a merit review matter. The restriction in s 7.19(1), for medical assessment matters and s 7.41(1) for miscellaneous claims assessment matters, only specifies that the matter may “not be referred by a claimant”. In these circumstances there is no reason why the assessment of the claimant’s permanent impairment should not proceed.

[2022] NSWPIC 298

2 June 2022