Jones v NRMA
[2022] NSWPIC 126
•25 February 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
CITATION: | Jones v NRMA [2022] NSWPIC 126 |
| CLAIMANT: | Max Jones |
| INSURER: | NRMA |
| MEMBER: | Maurice Castagnet |
| DATE OF DECISION: | 25 February 2022 |
| CATCHWORDS: | MOTOR ACCIDENTS - Claims assessment application; whether claimant had used “best endeavours’ to settle claim before referring it for assessment; section 7.32(3) of the Motor Accident Injuries Act 2017 (MAI Act); meaning of “best endeavours”; Held- In the context of the MAI Act and section 7.32(3), the obligation of using “best endeavours” is satisfied if the claimant has taken reasonable steps to make, prepare and advance his claim towards a resolution; no practical utility in pursuing settlement where degree of permanent impairment remains in dispute; the obligation does not require the claimant to capitulate and compromise his claim for the sake of achieving a settlement before referring it for assessment by the third anniversary of the motor accident. |
INTRODUCTION
The claimant is a 30-year-old man who suffered injuries in a motor accident on 3 August 2018, when the insured vehicle reversed out of a driveway and collided with the motorcycle he was riding on Baker Street, Carlingford.
On 2 August 2021, the claimant lodged an application with the Personal Injury Commission (the Commission) pursuant to section 7.36(1) of the Motor Accident Injuries Act 2017 (the MAI Act), referring his claim for common law damages for assessment.
As such, the application was lodged within 3 years of the date of the accident and in conformity with section 7.33 of the MAI Act.
DIRECTION SOUGHT BY THE CLAIMANT
The claimant seeks a direction for his application to be referred to the stood over list pursuant to s10(a) and s10(c) of the Commission’s Procedural Direction MAI 1, pending the conclusion of a medical assessment of his permanent impairment by the Commission.
THE INSURER’S POSITION
In written submissions submitted on 25 August 2021, the insurer opposed the direction sought by the claimant.
The insurer contends that the claimant has not complied with section 7.32 of the MAI Act which is a requirement before the claim can be referred for assessment. The insurer says the claimant has not used any endeavours to settle the claim before referring it to assessment. The parties have not engaged in any settlement discussions. Neither party has conveyed an offer of settlement at any time to date.
The insurer notes that the claimant has lodged his application with the Commission one day prior to the three-year anniversary of the accident and submits that this was done to “preserve time”.
The insurer submits the Commission may be minded to dismiss the application.
STEPS TAKEN BY THE CLAIMANT TO PROGRESS HIS COMMON LAW CLAIM
On 6 April 2020, the claimant made a claim for common law damages.
The insurer admitted liability for the claim on 10 August 2020.
On 13 September 2020, the claimant was assessed by Dr Gehr as having a permanent impairment of 13%.
On 9 October 2020, the claimant served the report of Dr Gehr on the insurer with a request to concede that the claimant is entitled to make a claim for damages for non-economic loss.
On 21 October 2020, the insurer, through its legal representatives, Moray & Agnew Lawyers advised the claimant that the insurer did not concede the threshold.
On the same day, the claimant sought an internal review of the insurer’s decision.
On 18 November 2020, the insurer advised the claimant that its original decision is confirmed because a review cannot be conducted due to “insufficient evidence”.
On 15 January 2021, the claimant lodged an application for a medical assessment of permanent impairment with the Commission.
On 6 May 2021, the insurer lodged a reply.
THE TELECONFERENCE
On 27 November 2021, I conducted a teleconference with the parties to discuss the direction sought by the claimant and the issues raised by section 7.32 and section 7.33 of the MAI Act. I also sought information from the parties about the progress of the outstanding medical assessment and any material that may be outstanding for an assessment of the claim.
I was informed by Mr El Kheir that two medical assessments had been arranged by the Commission of the claimant; the first, with Assessor Christopher Grainge on 6 December 2021 and the second, with Assessor Thomas Rosenthal on 17 January 2022.
As to outstanding material from the claimant, Mr Kenda indicated that the insurer is waiting on the claimant’s tax return for the 2021 financial year and current payslips.
Mr Kenda indicated that the insurer has also requested but not yet received, clinical notes from Westmead Hospital and Myhealth Medical Centre, North Rocks.
CONSIDERATION
According to subsection 6.14(1) of the MAI Act, a claim for damages cannot be made before the expiration of 20 months after the motor accident to which the claim relates unless the claim is in respect of injury resulting in a degree of permanent impairment of the injured person that is greater than 10%.
In the present case, the insurer has not at any stage of the claim conceded that the claimant’s permanent impairment is greater than 10%. The Commission has not yet completed the medical assessment of whole person impairment. Therefore, by virtue of the provision of subsection 6.14(1), the claimant could not have commenced his claim for damages until 3 April 2020. He did so on 6 April 2020.
Subsection 7.32 (3) of the MAI Act provides that parties to a claim must use their best endeavours to settle the claim before referring it for assessment by the Commission.
Subsection 6.23 (1) provides that a claim for damages by an injured person cannot be settled within 2 years after the motor accident 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%.
Section 7.33 of the MAI Act provides that a party to a claim cannot refer a claim for assessment by the Commission more than 3 years after the motor accident concerned unless the party provides a full and satisfactory explanation for the delay to the Commission and the Commission grants leave for the claim to be referred for assessment in accordance with the Commission rules.
In the present case, the three-year time anniversary of the motor accident occurred on 3 August 2021.
For the purposes of subsection 7.32 (3), the claimant had a period of 16 months (from 6 April 2020 to 3 August 2021) to use his best endeavours to settle his claim before referring it for assessment by the Commission. In any event, for the purposes of section 6.23 (1), any settlement could not have occurred before 3 August 2020.
If the claimant does not settle his claim by 3 August 2021, he is required pursuant to section 7.33, to make an application to the Commission to refer his claim for assessment. Otherwise, he must provide the Commission with a full and satisfactory explanation for the delay and he has to be granted leave by the Commission to do so.
The insurer argues that the claimant has not used his best endeavours because the parties have not engaged in any settlement discussions. Neither party has conveyed an offer of settlement at any time to the date of his application.
The effect of a `best endeavours' clause is to be determined in the context of the document in which it appears. [See Italo Australian Club Ltd v National Australia Bank Ltd (1981) 9 NSW Conv R58,328 and Nina's Bar Bistro Pty Ltd [1984] 3 NSWLR 613, Mahoney JA, with whom the other members of the Court agreed, (with qualifications which are not relevant for present purposes), at [58337].
The meaning of the term in a contractual context was considered by the High Court in Transfield Pty Ltd v Arlo International Ltd (1980) 144 CLR 83. In that case, Mason J stated at [101]:
“A "best endeavours" clause thus prescribes a standard of endeavour which is measured by what is reasonable in the circumstances, having regard to the nature, capacity, qualifications and responsibilities of the licensee viewed in the light of the particular contract.”
In my view and considering the objects of the MAI Act, the same notion of reasonableness should be applied when considering a party’s best endeavours in the context of subsection 7.32 (3) of the MAI Act.
In the present context, the MAI Act provides steps for making and pursuing claims. I have reviewed the steps taken by the claimant to progress his claim towards a resolution. Those steps are outlined above. The claimant had a period of 16 months to take those steps in circumstances where he bore injuries suffered from the motor accident.
I consider that the claimant has acted reasonably in making, preparing and advancing his claim towards a resolution, within the short window of time he is allowed to do so by the MAI Act.
Clause 7.32(3) applies to both the claimant and the insurer. In circumstances where the insurer has not conceded the permanent impairment threshold and the claimant is awaiting the conclusion of the medical dispute of his whole person impairment by the Commission, there is no practical utility, in my view, in pursuing a settlement of his claim until that issue is resolved. Indeed, there is an air of unreality about the proposition that the claim could be settled in circumstances where the parties remain in dispute about the degree of permanent impairment suffered by the claimant.
To use his best endeavours to settle his claim and in promoting the objects of the MAI Act, a claimant is not required to capitulate or to compromise his or her claim for the sake of achieving a settlement by the third anniversary of the motor accident.
DETERMINATION
In the circumstances of this case, I am satisfied for the purposes of subsection 7.32(3), the claimant has used his best endeavours to resolve his claim prior to making his application to the Commission to refer his claim for assessment.
It follows that the direction sought by the claimant for his application to be referred to the stood over list is reasonable.
However, I note that that the two medical assessments arranged by the Commission of the claimant should now have been conducted. The last assessment with Assessor Thomas Rosenthal was scheduled on 17 January 2022. I also note that the outstanding material from the claimant is limited to the service and lodgement of his claimant’s tax return for the 2021 financial year and current payslips.
I therefore consider that it would be more appropriate and more beneficial to the claimant in terms of progressing his claim to a resolution, that I make a direction for the matter to return before me in a few months to await the medical assessment certificates to be issued and to make further directions about the lodgement of outstanding material from the parties in readiness for an assessment of the application.
DIRECTIONS
The matter is listed for a further preliminary conference on Friday 2 May 2022 at 2 pm to await the issue of the medical assessment certificates and to determine whether the matter can proceed to an assessment conference.
If any party seeks a variation of these directions, the party seeking the variation is to contact the other party to obtain their consent and advise the Commission of the variation sought and the attitude of the other party.
Member Maurice Castagnet
Motor Accidents Division
Personal Injury Commission
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