Kenbrad Pty. Ltd. v Vakauta

[2001] NSWCA 204

CITATION:	Kenbrad Pty. Ltd. v. Vakauta [2001] NSWCA 204
FILE NUMBER(S):	CA 40150/00
HEARING DATE(S):	20/06/01
JUDGMENT DATE:	29 June 2001
PARTIES :	Kenbrad Pty. Limited - appellant Falanisesi Vakauta - respondent
JUDGMENT OF:	Meagher JA at 1; Hodgson JA at 2; Young CJ in Eq at 21

LOWER COURT JURISDICTION :	District Court
LOWER COURT FILE NUMBER(S) :	8914/99
LOWER COURT JUDICIAL OFFICER :	Naughton DCJ

COUNSEL:	Miss S. Norton for the appellant Mr. D. Deakin QC with Mr. R.C. Tonner for respondent
SOLICITORS:	Brydens Law Office, Liverpool Moray & Agnew, Sydney
CATCHWORDS:	TORTS - Nelgignece - Action for loss of services - Whether necessary to comply with claims requirements of Motor Accidents Act 1988. D.
LEGISLATION CITED:	Motor Accidents Act 1988 ss.2A(1), 9, 40(1), 40A, 43, 44, 44B, 48, 49, 50A, 52(1) adn (1A).
CASES CITED:	Marinovski v. Zutti Pty. Ltd. [1984] 2 NSWLR 571 GIO Australia Ltd. v. Robson (1997) 42 NSWLR 439 Budge v. Kimmorley (1991) 14 MVR 245 Westpac Banking Corporation v. Tomassian (1992) 32 NSWLR 207. Nowlin Pty. Ltd. v. Robson, unreported, 30/10/96.
DECISION:	Appeal dismissed with costs.

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40150/00
DC 8914/99

Friday 29th June 2001

KENBRAD PTY. LIMITED V. VAKAUTA

JUDGMENT

1   MEAGHER JA: I agree with the reasons of Hodgson JA as set out below.

2   HODGSON JA: This is an appeal brought by leave from a decision of Naughton DCJ, made on 25th February 2000, whereby his Honour dismissed proceedings brought by the appellant against the respondent, on the ground that the early notification provisions in the Motor Accident Act 1988 had not been complied with.

3 The appellant’s proceedings were commenced by a Statement of Claim in the District Court of New South Wales filed on 26th November 1999, in which the appellant claimed damages for loss of services of its servant Kenneth Burnett, alleging that on about 21st December 1996 Mr. Burnett received personal injuries from an accident caused by the respondent’s negligence in the use or operation of a motor vehicle. Although Mr. Burnett had complied with the early notification provisions of the Motor Accidents Act in respect of his own claim for personal injuries, the appellant did not give prior notice of its claim to the defendant’s insurer or any prior details of the economic loss claimed; and the defendant applied to have the proceedings dismissed on the basis of ss.43, 50A(d) and 52(1A) of the Motor Accidents Act. The appellant resisted the application on the ground that these provisions did not apply to a claim for loss of services.

4   The primary judge held that these provisions did apply to the appellant’s claim, relying on the decision in GIO Australia Limited v. Robson (1997) 42 NSWLR 439. In the first instance decision in that case, Hamilton AJ gave an affirmative answer to the following question, in relation to the claim made by the plaintiff in that case for loss of services:

Whether the third party policy issued by the insurer to the cross-claimant responds to the plaintiff’s claim in these proceedings should the plaintiff otherwise be able validly to initiate and maintain that claim, including by meeting necessary requirements for notification of claim under the Motor Accidents Act 1988 if any.

5 The Court of Appeal upheld Hamilton AJ’s decision to the effect that the statutory third-party policy referred to in s.9 of the Motor Accident Act applied to an action for loss of services; but the Court of Appeal did not deal with the question whether compliance with the claim requirements of that Act was necessary in relation to such an action.

6 In relation to accidents occurring after October 1999, the Motor Accidents Act 1988 has been displaced by the Motor Accidents Compensation Act 1999, s.142 of which abolishes actions for the loss of services. However, the 1998 Act applies to this case. The relevant sections of the 1988 Act are ss.2A(1), 9, 40(1), 40A, 43, 44, 44B, 48, 49, 50A and 52(1) and (1A). Those sections are in the following terms:

2A(1) The objects of this Act are:
(a) to repeal the Transport Accidents Compensation Act 1987 and thereby to abolish the scheme for compensating victims of transport accidents (TransCover) established under that Act, and
(b) to re-instate a common law based scheme under which damages can only be awarded after a finding of negligence, and
(c) by the scheme under this Act:
(i) to reduce the cost of the former common law based scheme by limiting benefits for non-economic loss in the case of relatively minor injuries, and
(ii) to introduce a stricter procedure for the making and assessment of claims for damages, and
(iii) to preserve the benefits payable to persons with more severe injuries involving on-going disability, and
(iv) to give full weight to the need to identify fraudulent claims, deter their lodgment and prosecute those responsible for them, and
(v) to encourage recovery from injury and early and effective rehabilitation, where appropriate, as a key feature of the scheme, and
(vi) to encourage the speedy, efficient and effective provision of benefits balanced by the need to investigate claims properly and the need to encourage an early return to employment.
9. A third-party policy under this Act is a policy that:
(a) insures the owner of the motor vehicle to which the policy relates and any other person who at any time drives the vehicle (whether or not with the consent of the owner) against liability in respect of the death of or injury to a person caused by the fault of the owner or driver of the vehicle:
(i) if the motor vehicle is not one to which subparagraph (ii) applies - in the use or operation of the vehicle in any part of the Commonwealth (whether or not on a road or road related area), or
(ii) if the motor vehicle is subject to an unregistered vehicle permit under the Road Transport (Vehicle Registration) Act 1997 - in the use or operation of the vehicle on any road or road related area in any part of the Commonwealth, and

(b) is in the terms of Schedule 1.

40(1) In this Part:
"claim" means a claim for damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle.
"claimant" means a person who makes or is entitled to make a claim.
"insurer", in relation to a person, means the insurer who insures the person against the person's liability for damages in respect of a claim, whether or not under a third-party policy, and includes (except in section 43) the Nominal Defendant and, where a claim is handled on behalf of an insurer by another insurer, the other insurer.
"third-party insurer" means an insurer under a third-party policy.

40A The objects of this Part are:
(a) to ensure that claims are quickly brought to the attention of insurers:
(i) to enable early investigation and assessment of claims, and
(ii) to enable the early identification of the nature and severity of the injuries sustained in the motor accident and of the likely treatment and rehabilitation needs of the injured person, and
(iii) so that insurers can readily predict claim frequency and hence make appropriate provision for the calculation of premiums, and
(iv) to enable accident victims to receive prompt treatment and rehabilitation and prompt payment of lost earnings where liability is clear, and

(b) to promote negotiation between the parties and, by means of alternate dispute resolution, to ensure that the resolution of disputed claims by the courts is kept to a minimum, and
(c) to underscore the need to deter and prevent the making of fraudulent and exaggerated claims

43(1) The object of this section is to promote the early making of claims to enable the insurer:
(a) to commence investigations while evidence relating to a claim is available, and
(b) to identify injuries and facilitate the access of claimants to appropriate injury management and rehabilitation services and thus to expedite the claimant's recovery, and
(c) to allow the insurer to more accurately predict claim frequency and hence formulate premiums
(2) A claim must be made within 6 months after the relevant date for the claim. The relevant date is the date of the motor accident to which the claim relates unless the claim is made in respect of the death of a person, in which case the relevant date is the date of the person's death.
(3) (Repealed)
(4) A claim is made by giving notice of the claim to the person against whom the claim is made and, if that person's insurer is a third-party insurer, to the insurer.
(5) The requirement under subsection (4) (only in so far as it is a requirement to give notice of a claim to the person against whom the claim is made and without affecting the requirement to give notice to the insurer) does not apply if:
(a) that person is dead, or
(b) that person cannot be given notice.

44(1) A notice of a claim under section 43 (4) must:
(a) be in the form approved by the Authority, and
(b) set out or be accompanied by such particulars and information as may be required by that form.
(1A) A notice of claim given to an insurer may, if approved by the Authority, require the claimant to do either or both of the following:
(a) furnish a medical certificate relating to the claim signed by a medical practitioner,
(b) authorise the insurer to obtain information and documents relevant to the claim from persons specified in the authorisation.
(2) The Authority may approve different forms according to the persons to whom the notice is to be given.
(3) A notice of a claim given to a third-party insurer must be verified by statutory declaration.

44B(1) If, within 2 months after receiving notice of a claim under section 43 (4), the insurer does not reject the claim for non-compliance with section 44, the insurer loses the right to challenge the claim on the ground of non-compliance with that section.
(2) If court proceedings are commenced in respect of a claim, an insurer who has not lost the right to challenge for non-compliance with section 44 may apply to have the proceedings dismissed on the ground of the relevant non-compliance only within 2 months after the statement of claim is served on the defendant and received by the insurer.
(3) A court may not dismiss proceedings if the relevant non-compliance is technical and of no significance.
(4) In this section, a reference to an insurer includes, in the case of a third-party insurer, a reference to the person against whom the claim is made.

48(1) The object of this section is to maximise communication between the parties so that sound and timely information is available and disputes are minimised.
(1A) A claimant must co-operate fully in respect of the claim with the person against whom the claim is made and the person's insurer for the purpose of giving the person and the insurer sufficient information:
(a) to be satisfied as to the validity of the claim and, in particular, to assess whether the claim or any part of the claim may be fraudulent, and
(b) to be able to make an early assessment of liability, and
(c) to be able to make an informed offer of settlement.
(2) In particular, the claimant must comply with any reasonable request by the other party or the other party's insurer:
(a) to furnish specified information (in addition to the information furnished in the claim form) or to produce specified documents or records, or
(b) to provide a photograph of and evidence as to the identity of the claimant.
(2A) The reasonableness of a request may be assessed having regard to criteria including the following:
(a) the amount of time the claimant needs to comply with the request,
(b) whether the information sought is cogent and relevant to a determination of liability or quantum of loss, having regard to the nature of the claim,
(c) the amount of information which has already been supplied to or is available to an insurer to enable liability and quantum of loss to be assessed and an offer of settlement made,
(d) how onerous it will be for the claimant to comply with the request,
(e) whether the information is privileged,
(f) whether the information sought is sufficiently specified,
(g) the time of the request and whether the claimant will be delayed in commencing proceedings by complying with the request.
(3) The duty under this section applies only until court proceedings are commenced in respect of the claim but if the claimant fails without reasonable excuse to comply with this section, court proceedings cannot be commenced in respect of the claim while the failure continues.

49(1) A claimant must comply with any request by the person against whom the claim is made or the person's insurer:
(a) to undergo a medical examination by one or more medical practitioners nominated by that person or insurer (not being an examination that is unreasonable, unnecessarily repetitious or dangerous), or
(b) to undergo an assessment to determine functional and vocational capacity by an assessor nominated by that person or insurer and approved by the Authority, or
(c) to undergo a rehabilitation assessment in accordance with the guidelines referred to in section 37 (1).
(2) If the claimant fails without reasonable excuse to comply with such a request, court proceedings cannot be commenced or continued in respect of the claim while the failure continues.
(3) An examination or assessment under this section is at the cost of the person who requests it.

50A Subject to section 52 (1A), a claimant is not entitled to commence court proceedings against another person in respect of a claim until the claimant has given the other person's insurer (if any) full details of:
(a) the injuries sustained by the claimant in the motor accident, and
(b) all disabilities and impairments arising from those injuries, and
(c) if those injuries, or any of them, have not stabilised, the prognosis for future recovery, and
(d) any economic losses and other losses that are being claimed as damages,
sufficient to enable the insurer, as far as practicable, to make a proper assessment of the claimant's full entitlement to damages

52(1) The objects of this section are:
(a) to encourage and facilitate the investigation, assessment and negotiation of a claim for damages without the commencement of court proceedings, and
(b) to impose a limitation period of 3 years for the commencement of legal proceedings for damages under this Act and to enable the extension of that period only if:
(i) the claimant can explain the reasons for the delay in not commencing the proceedings within the 3-year period, and
(ii) the claim is likely to result in an award of substantial damages,
or in the circumstances described in subsection (4A).
(1A) A claimant is not entitled to commence court proceedings against another person in respect of a claim until:
(a) 6 months have elapsed since notice of the claim was given to the other person and (if required by section 43 (4)) to the other person's insurer, or
(b) 90 days have elapsed since the details required by section 50A were given to the other person's insurer, or
(c) if the other person's insurer has made an offer of settlement to the claimant before the claimant commences court proceedings, 28 days have elapsed from the date on which the claimant's response to the offer is communicated to the other person's insurer,
whichever is the later or latest.

7   Miss Norton for the appellant submitted that an action for damages for loss of services of an injured employee was available in relation to a person such as Mr. Burnett, who was de facto governing director of the appellant: see Marinovski v. Zutti Pty. Limited [1984] 2 NSWLR 571. Such an action was not excluded by the statutory scheme established under the Motor Accident’s Act 1988: see GIO Australia Limited v. Robson (1997) 42 NSWLR 439.

8 Miss Norton submitted that the Motor Accidents Act was not a code: it restored the common law position, except to the extent that the Act itself affected common law rights. Miss Norton submitted that the Act did not refer specifically to actions for loss of services, and that the claim requirements in the Act were inappropriate to apply to loss of services claims In particular, s.44(1) stated that a notice of claim must be in the form approved by the Authority (that is, the Motor Accidents Authority of New South Wales constituted under Part 7 of the Act); and in fact the only two forms approved by the Authority were a motor accidents personal injury claim form and a compensation to relatives claim form, neither of which were applicable to claims for loss of services. Section 44, Miss Norton submitted, manifested an intention that the requirements of the Act concerning claims should not apply to causes of action unless and until an applicable form of notice of claim had been approved by the Authority. Miss Norton submitted that it was no answer that a claimant for loss of services could partially fill out a personal injuries claim form, because a partially incomplete claim form does not satisfy the requirements of the Act: see Budge v. Kimmorley (1991) 14 MVR 245. The appellant could not comply with s.44, and as a result could not comply with s.43; and the conclusion must be that these provisions do not apply to cases such as the present.

9 Miss Norton submitted that the object of Pt.5 of the Act, comprising ss.40 to 67, were set out in s.40A; and all such objects were fulfilled in this case by Mr. Burnett’s notice of his own claim for personal injuries. Just as the claim requirements of the Motor Accidents Act did not need to be complied with in relation to a claim under s.151Z(1)(d) of the Workers Compensation Act 1987, whereby an employer may claim an indemnity for payments made to employees injured in motor vehicle accidents, similarly those provisions did not apply to a claim for loss of services: cf. Westpac Banking Corporation v. Tomassian (1992) 32 NSWLR 207.

10 Miss Norton submitted that s.44 disclosed an intention that none of the requirements of Pt.5 should apply to a claim for loss of services: that is, it disclosed an intention that s.43 need not be complied with, and also an intention that s.50A need not be complied with. Accordingly, the claim was not affected by the requirements of s.52(1A).

11   Mr. Deakin QC for the respondent submitted that the effect of the decision of Hamilton AJ at first instance in the GIO Australia Limited v. Robson case (Nowlin Pty. Limited v. Robson, unreported, 30/10/96) was that the claim requirements of the Act did apply to actions for loss of services. He submitted that this Court should adopt Hamilton AJ’s reasoning that the Motor Accidents Act cannot be interpreted by reference to the lack of a claim form, because, except where regulations together with a statute form part of a legislative scheme, delegated legislation cannot be used for the purposes of interpreting a statute.

12   Next, Mr. Deakin submitted that the intention disclosed was that claimants comply with the provisions of the Act, so far as possible and to the extent that such provisions were applicable.

13   In my opinion, the decision in Robson is authoritative in relation to the meaning of the words “liability in respect of the death of or injury to a person caused by the fault of the owner or driver of” a motor vehicle, as those words are used in s.9 of the Act. In my opinion, it is similarly authoritative in relation to the meaning of the same words in the definition of “claim” in s.40(1) of the Act. That is, the case of Robson is authority, which this Court should follow, that a claim for loss of services arising from injury to an employee caused in the manner indicated by the relevant words is a “claim” as defined in s.40. In those circumstances, unless some contrary intention can be shown, the provisions of ss.43, 44 and 52(1A) apply to such claims

14 In order for the appellant to succeed in this appeal, it would be necessary, in my opinion, to hold that the requirement in s.44(1)(a) that a notice of a claim must be in the form approved by the Authority, coupled with the absence of an approved form appropriate to a claim for loss of services, means that this prima facie position is displaced. In effect, it becomes necessary to discern a legislative intention that ss.43, 44 and 52(1A) not apply unless and until an appropriate claim form has been approved by the Authority.

15 In my opinion, the words in s.44(1)(a) are insufficient to disclose such an intention. In addition to the very clear words of ss.43, 44 and 52(1A), and the problems of relying on regulations or prescription of claim forms in aid of interpretation of an Act, I would refer to the following further considerations.

16 In the first place, it is clear that Pt.5 of the Motor Accidents Act does apply to Compensation to Relatives Act claims A number of sections of Pt.5 are inapplicable to such claims, yet are expressed as applying to all claimants: see for example ss.48(2)(b), 49, 50A(a), (b) and (c), and 52(4B)(b). Section 49(1) in particular is expressed as applying to all claimants, yet plainly cannot be intended to apply to a claimant in a Compensation to Relatives Act claim. That in my opinion manifests an intention that the requirements of the Act should be interpreted as applying to different claims only to the extent that they are appropriate to those claims

17 It is arguable that the requirements of s.44, as to the form of a notice of claim, have no application unless a form appropriate to the particular type of claim has been prescribed. However, that of itself would not dispense with the requirement to give notice of the claim under s.43, or to provide the details required in paragraph (d) of s.50A. The alternative view would be that the claimant should use the personal injuries form, and fill out those parts of it that were applicable to the loss of services claim. That would in my view be sufficient compliance with s.44, assuming it applies to loss of services claims, especially having regard to s.44B(3), which makes provision to the effect that proceedings are not to be dismissed if any non-compliance with the claim requirements is “technical and of no significance”. On either approach, s.52(1A) would preclude the commencement of Court proceedings in this case, both because of the absence of a notice of claim and because of the failure to give the details required by s.50A(d).

18 The other additional reason for the view I have taken is that, in my opinion it does promote the objects of the Act, as contemplated by s.2B(1) of the Act, which requires preference of a construction “that would promote the object of this Act”. The objects of the Act are set out in s.2A, and in respect of Pt.5, they are elaborated in s.40A. Those objects, including the object of early investigation and assessment of claims, apply to loss of services claims equally with ordinary personal injuries claim. In a case such as the present, where the injured employee has given notice of his own personal injuries claim, the objects of the Act would require that the insurer also have notice of the fact that his employer is making a loss of services claim, and notice of the details of the economic loss claimed, as required by s.50A(d).

19 For those reasons, s.52(1A), including the conditions expressed in paragraphs (a) and (b) of that subsection, did apply to the appellant’s claim, and required its proceedings to be dismissed.

20   Accordingly, in my opinion the appeal should be dismissed with costs.

21   YOUNG CJ in Eq: I agree with Hodgson JA.

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