Insurance Australia Ltd trading as NRMA Insurance as agent for the Nominal Defendant v Toole

[2025] NSWSC 777

Supreme Court

New South Wales

Medium Neutral Citation:

Insurance Australia Ltd trading as NRMA Insurance as agent for the Nominal Defendant v Toole [2025] NSWSC 777

Hearing dates:

15 July 2025

Decision date:

18 July 2025

Jurisdiction:

Common Law

Before:

Adamson JA

Decision:

(1)   Extend the time for filing the summons to 18 March 2025.

(2)   Set aside the second defendant’s medical assessment of the first defendant made on 2 December 2024.

(3)   Set aside the third defendant’s decision made on 17 February 2025 to refuse to refer the plaintiff’s application for review of the second defendant’s medical assessment to a review panel.

(4) Remit the plaintiff’s application for a determination of the medical dispute to the third defendant for referral pursuant to s 7.20(2) of the Motor Accident Injuries Act 2017 (NSW) to a medical assessor other than the second defendant.

(5)   Make no order as to costs.

Catchwords:

ADMINISTRATIVE LAW — judicial review — jurisdictional error — motor vehicle accident — medical assessor assessed permanent impairment of a body part which did not fall within the scope of referral to medical assessor — where medical assessor denied procedural fairness — error of law on the face of the record and jurisdictional error — President’s delegate refused to refer decision to appeal panel — decisions of medical assessor and President’s delegate must be set aside — Motor Accidents Injuries Act 2017 (NSW), ss 4.11, 7.20, 7.21, 7.26

ADMINISTRATIVE LAW — application for extension of time granted as review panel could have corrected error had President’s delegate allowed it to be referred

Legislation Cited:

Motor Accident Injuries Act 2017 (NSW), ss 1.8, 4.11, 4.12, 7.17, 7.20, 7.21, 7.23, 7.26

Personal Injury Commission Act 2020 (NSW), ss 18, 33, Sch 2, cl 2

Supreme Court Act 1970 (NSW), s 69

Motor Accident Guidelines, cll 6.9, 6.17, 6.18, 6.121

Uniform Civil Procedure Rules 2005 (NSW), r 59.10

Cases Cited:

Craig v South Australia (1995) 184 CLR 163; [1995] HCA 58

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

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

Mandoukos v Allianz Australia Insurance Ltd [2024] NSWCA 71

McKee v Allianz Australia Insurance Ltd (2008) 71 NSWLR 609; [2008] NSWCA 163

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

Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57

Rodger v De Gelder (2011) 80 NSWLR 594; [2011] NSWCA 97

Rodger v De Gelder [2015] NSWCA 211; (2015) 71 MVR 514

Scone Race Club Ltd v Cottom [2024] NSWCA 34

Skates v Hills Industries Ltd [2021] NSWCA 142

Stanizzo v AAI Limited trading as GIO [2021] NSWSC 1077; (2021) 97 MVR 229

Category:

Principal judgment

Parties:

Insurance Australia Ltd trading as NRMA Insurance as agent for the Nominal Defendant (Plaintiff)
Craig Bernard Toole (First Defendant)
Medical Assessor appointed by the President of the Personal Injury Commission under Section 33 of the
Personal Injury Commission Act 2020 (Second Defendant)
President of the Personal Injury Commission of New South Wales (Third Defendant)

Representation:

Counsel:
J Gumbert (Plaintiff)
Submitting appearances (Defendants)

Solicitors:
Hall & Wilcox (Plaintiff)
Beilby Poulden Costello (First Defendant)
Crown Solicitor’s Office (Second and Third Defendants)

File Number(s):

2025/105793

 Decision under appeal 

Court or tribunal:

Personal Injury Commission

Jurisdiction:

Motor Accidents Division

Date of Decision:

2 December 2024; 17 February 2025

File Number(s):

M20616/24

HEADNOTE

[This headnote is not to be read as part of the judgment]

The plaintiff, Insurance Australia Ltd trading as NRMA Insurance, acting as agent for the Nominal Defendant (the insurer), sought judicial review of the decision of Dr Sophia Lahz (the medical assessor), that the first defendant, Craig Toole (the claimant), suffered a 5% Whole Person Impairment (WPI) to his lumbar spine as a result of a fracture to L2 and the decision by a delegate of the President of the Personal Injury Commission (PIC) (the President) to refuse the insurer’s application for review of the medical assessor’s assessment.

Notwithstanding that an L2 fracture did not fall within the ambit of the medical dispute referred to the medical assessor (having not been claimed by the claimant), the medical assessor found that the claimant suffered a 5% WPI on the basis of a L2 fracture. A separate medical assessment found a further 6% WPI for unrelated facial scarring, resulting in a combined WPI of 11%.

The insurer’s application for a review of this decision under s 7.26 of the Motor Accident Injuries Act 2017 (NSW) was rejected by the President’s delegate on 17 February 2025, finding no reasonable cause to suspect error. The insurer then filed proceedings in the Supreme Court on 18 March 2025, seeking orders setting aside both the medical assessor’s decision and the President’s refusal to refer the matter to a review panel. All the defendants filed submitting appearances.

The insurer advanced several grounds for review, of which only three needed to be determined: first, the decision was unlawful since the medical assessor exceeded the scope of the referral; second, the parties were denied procedural fairness as they were not notified of the assessor’s intention to assess an injury which fell outside the referral; and third, the delegate’s decision fell away because the medical assessor’s decision was invalid.

Adamson JA held allowing the challenge:

The need for an extension of time

1. Proceedings for judicial review of a decision must be commenced within 3 months of the decision. The insurer filed the summons on 18 March 2025, despite challenging a decision by the medical assessor made on 2 December 2024 and therefore requires an extension of time: [35].

2. It was both reasonable and appropriate for the insurer not to challenge the medical assessor’s decision until the delegate’s decision had been made, since the review panel might have corrected the alleged error. Thus, the insurer’s delay was entirely explicable, and it is appropriate to extend time for the filing of the summons to 18 March 2025: [36]-[37].

Rodger v De Gelder (2011) 80 NSWLR 594; [2011] NSWCA 97; Stanizzo v AAI Limited trading as GIO [2021] NSWSC 1077; (2021) 97 MVR 229, cited.

Alleged error in assessing a matter outside the medical dispute

1. The scope of the dispute was evident from the terms of the referral. It did not include an L2 fracture. The medical assessor erred in law by failing to assess the actual medical dispute which had been referred to her: [42]-[49].

2. This error constituted both an error of law on the face of the record and a jurisdictional error, warranting an order setting aside the certificate.

Scone Race Club Ltd v Cottom [2024] NSWCA 34; Skates v Hills Industries Ltd [2021] NSWCA 142; Mandoukos v Allianz Australia Insurance Ltd [2024] NSWCA 71; Rodger v De Gelder [2015] NSWCA 211; (2015) 71 MVR 514, applied.

Craig v South Australia (1995) 184 CLR 163; [1995] HCA 58, cited.

Alleged denial of procedural fairness

1. The medical assessor failed to afford procedural fairness by not informing the parties of her intention to assess an injury beyond the scope of the referral. Practical justice required that the parties be given an opportunity to make submissions and adduce further evidence. This denial of procedural fairness was central to the assessment and constitutes a jurisdictional error: [54]-[56].

Kirk v Industrial Relations Commission of New South Wales (2010) 239 CLR 531; [2010] HCA 1; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57; McKee v Allianz Australia Insurance Ltd (2008) 71 NSWLR 609; [2008] NSWCA 163; Frost v Kourouche (2014) 86 NSWLR 214; [2014] NSWCA 39, cited.

Alleged invalidity of the delegate’s decision following the invalidity of the medical assessor’s decision

1. As the medical assessor’s decision must be set aside, the delegate’s decision, which is founded on it, falls away and must also be set aside: [58].

Stanizzo v AAI Limited trading as GIO [2021] NSWSC 1077; (2021) 97 MVR 229, cited.

1. The matter ought be remitted to the President for referral to a different medical assessor in accordance with law to avoid any suggestion of apprehension of bias: [49]-[52].

Stanizzo v AAI Limited trading as GIO [2021] NSWSC 1077; (2021) 97 MVR 229, cited.

JUDGMENT

Introduction

1. By amended summons filed on 7 April 2025, the plaintiff, Insurance Australia Limited trading as NRMA Insurance as agent for the Nominal Defendant (the insurer), seeks to challenge the following:

1. the decision of the second defendant of 2 December 2024, Dr Sophia Lahz (the medical assessor), that the first defendant, Craig Toole (the claimant) suffered 5% Whole Person Impairment (WPI) to his lumbar spine as a result of a motor accident on 10 March 2021 (the medical assessor’s decision); and

2. the decision of the third defendant of 17 February 2025, the President of the Personal Injury Commission (PIC) (the President), through a delegate, to refuse the insurer’s application for review of the medical assessor’s decision.

2. Each of the defendants has filed a submitting appearance.

The statutory scheme

The Motor Accident Injuries Act 2017 (NSW)

3. Before setting out the background to the current proceedings, I propose to outline the statutory scheme established by the Motor Accident Injuries Act 2017 (NSW) (the Act), which applies to motor accidents which occurred after 1 December 2017: s 1.8. Unless otherwise indicated, all references to legislation in these reasons are to the Act.

4. 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 accident is greater than 10%: s 4.11. If there is a dispute, damages may not be awarded for non-economic loss until a medical assessor appointed by PIC has carried out an assessment of permanent impairment under Division 7.5: s 4.12. Under Sch 2, cl 2(a), the degree of permanent impairment of the injured person that has resulted from the injury caused by the motor accident (including whether the degree of permanent impairment exceeds 10%) is declared to be a “medical assessment matter” for the purposes of Part 7 (entitled “Dispute Resolution”). In Part 7, a medical dispute means, relevantly, a dispute between a claimant and an insurer about a medical assessment matter: s 7.17(a).

5. A medical dispute about a claim may be referred to the President for assessment by either party to the dispute: s 7.20(1)(a). The President is to arrange for the dispute to be dealt with by one or more assessors: s 7.20(2). The President is empowered to appoint medical assessors for the purposes of the Act: s 33(1)(b) of the Personal Injury Commission Act 2020 (NSW) (the PIC Act).

6. The claimant and the insurer must provide to the medical assessor such information as the assessor may reasonably require for the purposes of the medical assessment: s 7.20(4).

7. Section 7.21 provides in part:

7.21   Assessment of degree of permanent impairment

(1)     The assessment of the degree of permanent impairment of an injured person for the purposes of this Act is to be made in accordance with the Motor Accident Guidelines. The assessed degree of permanent impairment is to be expressed as a percentage.

(2)     Impairments that result from more than one injury arising out of the same motor accident are to be assessed together to assess the degree of permanent impairment of the injured person.

8. Section 7.23(1) requires a medical assessor to whom a medical dispute is referred to give a certificate as to the matters referred for assessment. A certificate is to set out the reasons for any finding by the medical assessor as to any matter certified in the certificate in respect of which the certificate is conclusive evidence: s 7.23(7).

9. A medical assessment may be reviewed by a review panel but only if the President 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: s 7.26(5). The President may delegate this function: s 18(1) of the PIC Act.

10. Pursuant to s 7.26(5A), the President is empowered to constitute a review panel. The review of a medical assessment is not limited to the particular aspect 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: s 7.26(6). The review panel may confirm the certificate of the medical assessor or revoke it and issue a new certificate: s 7.26(7).

The Motor Accident Guidelines

11. Clause 6.9 of the Motor Accident Guidelines (the Guidelines) provides:

Impairment is defined as an alteration to a person's health status. It is a deviation from normality in a body part or organ system and its functioning. Hence, impairment is a medical issue and is assessed by medical means.

12. Clauses 6.17 and 6.18 of the Guidelines provide:

Evaluation of impairment

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

(a)    is an impairment arising from an injury caused by the accident, and

(b)   is an impairment as defined in clause 6.9 (above).

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

(a)    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

(b)    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

(c)   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.

13. Clause 6.121 of the Guidelines (which is relevant to ground 4) provides:

While imaging and other studies may assist medical assessors in making a diagnosis, it is important to note that the presence of a morphological variation from what is called normal in an imaging study does not make the diagnosis. Several reports indicate that approximately 30% of people who have never had back pain will have an imaging study that can be interpreted as positive for a herniated disc, and 50% or more will have bulging discs. Further, the prevalence of degenerative changes, bulges and herniations increases with advancing age. To be of diagnostic value, imaging findings must be concordant with clinical symptoms and signs, and the history of injury. In other words, an imaging test is useful to confirm a diagnosis, but an imaging result alone is insufficient to qualify for a DRE category.

The background

14. On 8 April 2021, the claimant applied to the insurer for personal injury benefits for injuries alleged to have been sustained in a motor accident on 10 March 2021. On 28 February 2023, the claimant claimed damages under common law (being damages claimed for non-economic loss) for such injuries on the basis that he had suffered a WPI of greater than 10% as a consequence of injuries which he alleged that he had sustained in the motor accident.

15. The material which the claimant submitted with his claim included a medical report of Dr James Bodel, an orthopaedic surgeon, who relevantly diagnosed that the claimant had suffered “a soft tissue injury … to the back”. Of the issue of lumbar spinal fractures, Dr Bodel said:

He has a DRE lumbosacral category II level of assessable impairment in accordance with the description in Table 72 on Page 3/110 of AMA4. Again, there is asymmetry of movement and guarding and no clinical sign of radiculopathy and a 5% Whole Person Impairment rating.

The transverse process fractures may also attract the DRE lumbosacral category II rating in this circumstance but either method gives the same answer which is the 5% Whole Person Impairment. They cannot be aggregated to a higher rating. Five percent is the correct rating.

16. The claimant’s application also included CT scans which had been performed on the day of the accident at Goulburn Base Hospital which reported:

Non-displaced peripheral right L1 transverse process fracture. Subtle cortical irregularity of L2 without displacement… Degenerative change is seen within the lumbosacral spine without evidence of an acute fracture.

17. The insurer relevantly disputed that the claimant had sustained the alleged lumbar spine injury in a motor accident or that any such injury was sustained as a result of what occurred on 10 March 2021. The insurer pointed to the absence of contemporaneous references to any injury to the lumbar spine in the ambulance or hospital records and submitted (relying on Dr Todd Gothelf’s report) that, if any injury to the lumbar spine had been suffered, it was a soft tissue injury. The insurer relied on the delay of 27 days between the motor accident and the day on which the claimant first reported symptoms relating to his lower back.

18. The insurer’s rejection of the claim for damages for non-economic loss, gave rise to a medical dispute about a medical assessment matter within the meaning of s 7.17.

19. On 12 July 2024, the claimant applied for a determination of the medical dispute, as he was entitled to do under s 7.20(1)(a) of the Act. Relevantly, his application described the injury to his lumbar spine in the following terms:

Fracture of the transverse processes at L1 and L2 and soft tissue injuries.

20. The insurer filed its reply on 5 August 2024. Under the heading, “Disputes”, the insurer said:

The Insurer does not concede that the Claimant’s alleged physical and psychological injuries are caused by a motor vehicle accident, or that they give rise to an assessment of permanent impairment which is greater than the 10% threshold.

21. In relation to the claimant’s lumbar spine, the insurer disputed that the claimant sustained an injury to his lumbar spine as a result of the motor accident and submitted that, in any event, the injury did not give rise to any assessable impairment.

22. The President referred the assessment of the claimant’s injuries to the medical assessor, as required by s 7.20(2). The injuries which were referred relevantly included, with respect to the lumbar spine: “fracture of the transverse processes at L1 and L2 and soft tissue injuries”. The referral reflected the ambit of the claimant’s claim with respect to his lumbar spine.

23. The medical assessor examined the claimant on 25 November 2024 and issued a certificate on 2 December 2024. She made the following assessment with respect to injuries alleged to have been sustained by the claimant to his lumbar spine:

The following injuries caused by the motor accident give rise to a permanent impairment of 5% WPI and IS NOT GREATER THAN 10%:

-   Lumbar spine – Fracture of the transverse processes at L1 (undisplaced), and fracture of L2 with minor cortical deformity and soft tissue injuries.

(Underlining added.)

24. In her reasons, the medical assessor referred to CT scans which were taken on the day of the accident (10 March 2021) and said of present relevance:

There were non-displaced fractures of the right L1 transverse process according to the formal report 10/3/21. There was subtle L2 irregularity without displacement. Pelvic structures were within normal limits. Both hips were normally aligned. There was lumbosacral spine degenerative change without acute fracture aside from the transverse process fractures mentioned above.

(Emphasis added.)

25. The medical assessor also referred to scans of the claimant’s abdomen which were taken two days later on 12 March 2021 and said:

Scans of the abdomen and pelvis 12/3/21 showed non-displaced right L1 transverse process and cortical irregularity of L2 without displacement. There was degeneration of the lumbar spine without acute fracture.

(Emphasis added.)

26. In her summary of imaging and other investigations, the medical assessor said:

No films/imaging were brought to the assessment. The only imaging completed post-accident is that from Goulburn Hospital during the immediate aftermath of the accident, which he does not have in his possession.

I later requested a link to the imaging, which was provided. I reviewed in particular the CT lumbar spine images taken during March 2021 during the immediate aftermath of the accident and I agree with the report regarding the right-sided transverse process at L1 and minor cortical deformity of the L2 vertebral body (without vertebral compression).

(Emphasis added.)

27. Under the heading “Summary of injuries referred by the parties”, the medical assessor said:

The following injuries WERE caused by the motor accident:

•    Lumbar spine fractures – right L1 transverse process (undisplaced) and minor L2 body fracture with cortical deformity (akin to an endplate fracture, no vertebral body compression)

(Emphasis added.)

28. Under the heading “Determinations – Permanent Impairment”, the medical assessor said:

The clinical findings at the lumbar spine are consistent with DREI [Diagnosis-related estimate I] or else 0% WPI. There were no features to suggest DRE category exceeding DREI [the lowest category].

As noted above, I have reviewed the lumbar spine films March 2021 performed immediately postaccident, demonstrating undisplaced right L1 transverse process fracture and minor cortical deformity of L2. There is no impairment for undisplaced transverse process (paragraph 6.149 page 109 MAG [Motor Accident Guidelines]). The transverse process fracture must be displaced for WPI. However, there is minor cortical deformity of L2 body consistent with (vertebral body) fracture, analogous to vertebral endplate fracture (a vertebral fracture without vertebral body compression) for which 5% WPI can be deemed (DREII) per paragraph 6.150 page 110 of MAG. He has persistent symptoms at the lumbar spine, thus entitled to WPI for this vertebral body fracture without vertebral compression.

Of note, he does not meet the criteria for multilevel structural compromise because although there have been fractures of both L1 and L2, the definition of vertebral fracture for this purpose (paragraph 6.144 page 109 MAG) includes any fracture of the vertebral body or of the posterior elements forming the ring of the spinal canal i.e. the pedicle or lamina, not the case in Mr Toole. A transverse process fracture does not involve the vertebral body, nor does it involve the ring of the spinal canal. Specifically fractures of transverse processes and spinous processes are excluded even at multiple levels.

In summary, there is 5% WPI for the lumbar spine injury.

(Emphasis added.)

29. Another medical assessor, Dr Michael McGlynn, assessed the claimant’s WPI from skin scarring and facial injuries to be 6%. Together with the 5% for the lumbar spine injury, the claimant’s WPI is 11%. As this exceeds 10%, the claimant is entitled, subject to successful challenge, to damages for non-economic loss.

30. On 15 January 2025, the insurer applied to the President for a review of the medical assessment by a review panel pursuant to s 7.26(1), alleging, in its submissions, that the assessment was “incorrect in a material respect”: s 7.26(2). On 6 February 2025, the claimant lodged his reply to the insurer’s application.

31. On 17 February 2025, the delegate of the President rejected the insurer’s application on the basis that the delegate was not satisfied that there was reasonable cause to suspect that the medical assessment was incorrect in a material respect.

32. On 18 March 2025, the insurer filed a summons in this Court to challenge the decisions of the medical assessor and the President. As noted above, there is no active defendant as all defendants have filed submitting appearances.

The grounds of challenge

33. The insurer sought to challenge the respective decisions on the following grounds:

1. the medical assessor;

1. purported to determine a matter which fell outside the ambit of the medical dispute between the parties which had been referred to her; and

2. denied the parties procedural fairness by failing to put them on notice of her intention to assess impairment from an injury which fell outside the ambit of the referral;

2. the medical assessor failed to expose her path of reasoning in her reasons for finding that the “cortical deformity” shown on imaging following the accident was an acute fracture caused by the accident;

3. the medical assessor failed to address in her reasons the insurer’s submission that, as the claimant had not reported back pain until 27 days after the motor accident, the symptoms were unlikely to be attributable to the motor accident;

4. the medical assessor failed to conduct her assessment in accordance with cl 6.121 of the Guidelines;

5. the decision of the President’s delegate is invalid because the medical assessor’s assessment is invalid; and

6. it was not open to the President’s delegate to refuse to refer the medical dispute to a review panel, having regard to the errors made by the medical assessor.

34. Ms Gumbert, who appeared for the insurer, accepted that it was not necessary for the Court to determine all grounds and that it was sufficient for the Court to determine grounds 1(a) and (b) and ground 5.

Consideration

The need for an extension of time

35. Unless an extension of time is granted, proceedings for judicial review of a decision must be commenced within 3 months of the date of the decision: Uniform Civil Procedure Rules 2005 (NSW), r 59.10. The plaintiff challenges the decision of the medical assessor made on 2 December 2024 and the decision of the President’s delegate made on 17 February 2025. As the summons was not filed until 18 March 2025, the plaintiff requires an extension of time in respect of the challenge to the medical assessor’s decision.

36. It was both reasonable and appropriate for the plaintiff not to challenge the medical assessor’s decision under s 69 of the Supreme Court Act 1970 (NSW) until the delegate’s decision had been made, since the review panel was obliged to conduct its own assessment and might have corrected the alleged error: Rodger v De Gelder (2011) 80 NSWLR 594; [2011] NSWCA 97 at [84]-[86] (Beazley JA, McColl and Macfarlan JJA agreeing), applied in Stanizzo v AAI Limited trading as GIO [2021] NSWSC 1077; (2021) 97 MVR 229 (Stanizzo) at [18].

37. Once the insurer’s avenue for review was removed by the delegate’s refusal to refer the medical dispute to a review panel, the plaintiff was entitled to seek relief in this Court under s 69 of the Supreme Court Act. Its delay was entirely explicable and the extension required relatively short. The extension is not opposed. In these circumstances, it is appropriate to extend time for the filing of the summons to 18 March 2025.

The Court’s jurisdiction to set aside the decisions which are challenged

38. In order to challenge either of these decisions under s 69 of the Supreme Court Act or in the Court’s inherent jurisdiction, the insurer must establish that the decision-maker has committed an error of law on the face of the record or a jurisdictional error.

39. Section 69 relevantly provides:

…

(3)     The jurisdiction of the Court to grant any relief or remedy in the nature of a writ of certiorari includes, if the Court is satisfied that the ultimate determination of a court or tribunal in any proceedings has been made on the basis of an error of law that appears on the face of the record of the proceedings—

(a)     jurisdiction to quash the ultimate determination of the court or tribunal, and

(b)     if the Court determines that, as a matter of law, only one particular determination should have been made by the court or tribunal, jurisdiction to make such judgment or orders as are required for the purpose of finally determining the proceedings.

(4)     For the purposes of subsection (3), the face of the record includes the reasons expressed by the court or tribunal for its ultimate determination.

…

(Emphasis added.)

40. At common law, the reasons of the decision-maker do not form part of “the record”. In the present case, the medical assessor is required to give reasons and such reasons form part of the certificate: s 7.23(7). The effect of s 7.23(7) is to include the medical assessor’s reasons in the record since they are part of the certificate and the certificate is the record: Pham v NRMA Insurance Ltd [2014] NSWCA 22; (2014) 66 MVR 152 at [27] (Leeming JA, Tobias AJA agreeing). In these circumstances, the insurer did not need to rely on the extended definition of record in s 69(4) of the Supreme Court Act in its challenge to the medical assessor’s decision.

41. As it could not be said that the decision of the delegate to refer (or not refer) an application for review to a review panel constitutes “the ultimate determination of a court or tribunal in any proceedings” within the meaning of s 69(3) of the Supreme Court Act, the expansive definition of the “record” in s 69(4) is not available to the insurer’s challenge to the President’s decision not to refer the matter to a review panel. Nor is there an equivalent provision to s 7.23(7). Accordingly, in order to obtain relief in respect of the delegate’s refusal to refer the application to a review panel, the insurer must establish jurisdictional error.

The grounds of challenge

Ground 1(a): alleged error in assessing a matter outside the medical dispute

42. The ambit of the dispute which was referred to the medical assessor is evident from the terms of the referral. It accorded with the claimant’s claim with respect to injuries to his lumbar spine and corresponded with the insurer’s rejection of the claim. Thus, the terms of the referral reflected the “medical dispute” between the parties. In these circumstances, the referral delineated the ambit of the medical assessor’s jurisdiction. It was an error for the medical assessor to include a matter which was not within the ambit of the referral: see Scone Race Club Ltd v Cottom [2024] NSWCA 34 (Scone) at [53] (Basten AJA, Gleeson and Mitchelmore JJA agreeing).

43. While there may be cases where the ambit of the referral is a question of fact which is for the assessor (or review panel) to determine, the present case is not one of them since the injuries referred were stated with precision and did not include a fracture to the L2. Nor did the medical reports submitted by either the claimant or the insurer indicate that there had been a fracture to the claimant’s L2.

44. This case is to be distinguished from a case such as Skates v Hills Industries Ltd [2021] NSWCA 142 (Skates) where the terms of the referral made no reference to the wrist injury although it had been claimed in the worker’s application filed in the Workers Compensation Commission and was referred to in the medical reports relied on by the parties. The Court of Appeal (Basten JA, Leeming JA agreeing) held that, in those circumstances, the Appeal Panel was in error in failing to assess the wrist injury, which formed part of the claim.

45. Basten JA said of present relevance:

31   … once it is accepted that the scope of the referral was properly capable of restriction by reference to body parts/systems, the question as to how the Appeal Panel read the referral may well have been a matter for its professional judgment and not one involving reviewable error. In any event it was not submitted that it misread the referral. However, the claim was in fact wider than the referral in that it extended to the left wrist.

32 More broadly, this approach is confirmed by having regard to the statutory scheme, a matter which was fully developed by the primary judge in her reasons. Critically for present purposes, the concept of “whole person impairment” is itself not found in the Workplace Injury Act, which, reflecting s 66 of the Workers Compensation Act, uses the term “permanent impairment”. As set out above, s 322 of the Workplace Injury Act requires that an assessment of the degree of permanent impairment “is to be made in accordance with Workers Compensation Guidelines (as in force at the time the assessment is made) issued for that purpose.” Section 331, dealing with the promulgation of Guidelines has also been noted.

33   Without attempting to set out the detail of the Guidelines and the AMA Guides, to which the Court was not taken, it is sufficient to note that the medical assessment certificate was required to identify the specific body part or system, together with the “chapter, page and paragraph number in WorkCover Guides” and the “chapter, page, paragraph, figure and table numbers in AMA 5 Guides”. Identification of the extent of impairment by reference to individual body parts and body systems is required by the Guidelines and Guides which the statute obliges the AMS to follow.

46. In Scone, the worker applied to admit late documents for the Appeal Panel’s consideration. The question arose whether the Appeal Panel had considered this application, no reference having been made to them in its reasons. The Court of Appeal accepted the employer’s submission that the documents were irrelevant because they related to the worker’s back injury and the only injury which had been referred to the medical assessor (against whose assessment the worker sought to appeal to the Appeal Panel) was the injury to the worker’s right knee. Basten AJA said:

53   As the Appeal Panel was restricted … to the injury the subject of the referral (namely to the right knee), it could not properly have dealt with either of the matters raised in the late documents accompanying the application of 9 March 2022.

54   … it is beyond doubt that the locus of the injury which was the subject of the medical assessment certificate was the right knee: it did not include a separate injury to the lumbar spine.

47. The decision of Mandoukos v Allianz Australia Insurance Ltd [2024] NSWCA 71 (Mandoukos) is to similar effect. In that case, the medical dispute which was referred for assessment did not include the removal of bone during a foraminotomy procedure (which was the basis for the claimant’s allegation that he suffered radiculopathy as a result of the accident). Stern JA (Leeming and Kirk JJA agreeing) said at [78]:

Thus, the medical dispute “about a medical assessment matter” will, in each case, be a question of fact depending upon the ambit of the dispute between the parties at the relevant time having regard to the competing claims made. Whilst it is of course possible that a dispute about a medical assessment matter might comprise the whole of the relevant medical assessment matter, that is not necessarily so.

48. Thus, the medical assessor in Mandoukos was held not to be in error in not considering this alleged injury: [96]-[97]. Further, the Court held that it was open to the President’s delegate not to be satisfied that there was reasonable cause to suspect that the medical assessment was incorrect in a material respect. This question did not turn on whether the medical assessor’s error was jurisdictional: [101].

49. I consider that the error alleged in ground 1(a) (that the assessment exceeded the parameters of the referral) was both an error of law on the face of the record (since it is plain from the reasons that the error of law was made) and a jurisdictional error.

50. This error amounted to a jurisdictional error in the sense described in Rodger v De Gelder [2015] NSWCA 211; (2015) 71 MVR 514 at [95] (Gleeson JA, Macfarlan and Leeming JJA agreeing):

It has also been said where the relevant facts have been clearly established and the reasons show the decision-maker acted on the wrong basis in important respects, the decision-maker has failed properly to exercise their jurisdiction … 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 ….

(Citations omitted.)

51. In the present case, the medical assessor mistook the extent of her jurisdiction by including an injury in her certificate which had not been referred to her expressly; and which did not fall within the ambit of what had been referred to her: Craig v South Australia (1995) 184 CLR 163 at 179 (Brennan, Deane, Toohey, Gaudron and McHugh JJ); [1995] HCA 58. This error was not one of fact since it was not the result of the medical assessor’s construction of the terms of the referral as a matter of her professional judgment (as was referred to by Basten JA in Skates at [31]), but rather was one of jurisdiction because the medical assessor disregarded the terms of the referral and, in doing so, went outside the bounds of the medical dispute between the parties. In this respect, the medical assessor constructively failed to exercise her jurisdiction by failing to assess the actual medical dispute which had been referred to her for assessment and, instead, assessing a matter which had not arisen, whether by way of dispute or otherwise.

52. This error is sufficient to warrant an order that the certificate be set aside and that the matter be remitted to the President to be referred to a different medical assessor for assessment in accordance with law.

53. It is not necessary to determine whether there are circumstances in which it may be lawful for a medical assessor to go beyond the terms of a referral since it was not suggested that there were such circumstances in the present case. Procedural fairness would, in any event, require the medical assessor to put the parties on notice of the possibility that the medical assessor proposes to go beyond the terms of the referral before a decision is made. Procedural fairness is addressed below with respect to ground 1(b).

Ground 1(b): alleged denial of procedural fairness

54. The insurer submitted that the medical assessor failed to accord procedural fairness to the parties by failing to put them on notice that she proposed to assess an injury that was beyond the scope of the medical dispute referred for assessment.

55. A failure to accord procedural fairness can amount to jurisdictional error: Kirk v Industrial Relations Commission of New South Wales (2010) 239 CLR 531; [2010] HCA 1 at [60]; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; [2000] HCA 57 at [41] (Gleeson CJ), [142] (Kirby J) and [170] (Hayne J).

56. In the context of an assessment under the Act or its equivalent, if a medical assessor proposes to go beyond the dispute between the claimant and the insurer which has been referred for assessment, procedural fairness requires the medical assessor to inform parties of that intention before making the assessment. Practical justice requires that, in this event, the parties be given the opportunity of making submissions and, potentially, adducing further evidence: McKee v Allianz Australia Insurance Ltd (2008) 71 NSWLR 609; [2008] NSWCA 163 at [8] (Allsop P) and Frost v Kourouche (2014) 86 NSWLR 214; [2014] NSWCA 39 at [41] (Leeming JA, Beazley P and Basten JA agreeing). Had this occurred, the parties in the present case could, for example, have informed the medical assessor that a fracture to L2 did not form part of the referral and that neither party contended that a L2 fracture constituted an injury or impairment caused by the motor accident. The denial of procedural fairness was central to the medical assessor’s assessment. The insurer has also made out jurisdictional error on this ground.

Grounds 2-4

57. As referred to above, it is not necessary to address grounds 2-4 since the decision of the medical assessor must be set aside by reason of the errors identified in ground 1(a) as well as in ground 1(b).

Ground 5: alleged invalidity of the delegate’s decision following the invalidity of the medical assessor’s decision

58. I accept the insurer’s submission that, once the medical assessor’s decision is set aside, the decision of the delegate falls away since it is founded on the validity of the medical assessor’s decision: see Stanizzo at [16]. For this reason, it is both necessary and appropriate that it be set aside.

Ground 6

59. As ground 5 has been made out, Ms Gumbert accepted that it is not necessary to determine ground 6.

Costs

60. As all defendants have filed submitting appearances, Ms Gumbert accepted that it is appropriate that there be no order as to costs.

The form of orders

61. I accept Ms Gumbert’s submission that, on the basis of the matters referred to in Stanizzo at [17], the matter ought be remitted for referral to a medical assessor other than the second defendant. This course would avoid any suggestion of apprehension of bias which might arise were the matter to be referred to the second defendant for re-assessment.

Orders

62. For the reasons given above, I make the following orders:

1. Extend the time for filing the summons to 18 March 2025.

2. Set aside the second defendant’s medical assessment of the first defendant made on 2 December 2024.

3. Set aside the third defendant’s decision made on 17 February 2025 to refuse to refer the plaintiff’s application for review of the second defendant’s medical assessment to a review panel.

4. Remit the plaintiff’s application for a determination of the medical dispute to the third defendant for referral pursuant to s 7.20(2) of the Motor Accident Injuries Act 2017 (NSW) to a medical assessor other than the second defendant.

5. Make no order as to costs.

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Decision last updated: 18 July 2025