McKay v McKay

[2010] QSC 84

SUPREME COURT OF QUEENSLAND

CITATION:

McKay v McKay and Anor [2010] QSC 84

PARTIES:

McKAY, Clare Maree as Litigation Guardian for McKAY, Cecily Maureen
(applicant)
v
McKAY, Ian Ronald
(first respondent)
SUNCORP METWAY INSURANCE LTD
ACN 075 685 966

(second respondent)

FILE NO/S:

SC No 2079 of 2009

DIVISION:

Trial Division

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

19 January 2010

DELIVERED AT:

Brisbane

HEARING DATE:

19 January 2010

JUDGE:

Margaret Wilson J

ORDER:

That the application be dismissed.

CATCHWORDS:

PROCEDURE – SUPREME COURT PROCEDURE – QUEENSLAND – PROCEDURE UNDER RULES OF COURT – JUDGMENTS AND ORDERS – OTHER MATTERS – ORDER SANCTIONING COMPROMISE – where applicant sustained personal injuries in motor vehicle accident – where proceedings against person responsible and insurer not yet instituted – where applicant sustained severe brain damage and is a person under a legal disability – where  second respondent insurer advised applicant it was prepared to meet reasonable and appropriate rehabilitation costs, and to admit liability in full – where Court declared that funding to a limit of $425,000 for demolition of applicant’s then residence and construction of alternate premises on the site would be reasonable and appropriate rehabilitation – where cost of demolition and construction of alternative premises will exceed that sum by approximately $109,000 – where second respondent willing to fund the additional $109,000 by way of an advance on the damages or settlement moneys which it anticipates ultimately having to pay, rather than as a rehabilitation measure – where applicant's litigation guardian satisfied that is appropriate way of dealing with matter – where application brought by second respondent for sanction of the Court pursuant to Public Trustee Act 1978 (Qld), s 59(2) – whether s 59(2) is engaged

Motor Accident Insurance Act 1994 (Qld), s 39(1)(a)(iv), s 51(5)(b)

Public Trustee Act 1978 (Qld), s 59(2)

COUNSEL:

M Grant-Taylor SC for the applicant.

S Jensen (sol) for the respondents.

SOLICITORS:

Schultz Toomey O’Brien Lawyers for the applicant.

Jensen McConaghy for the respondents.

HER HONOUR:  The applicant Cecily Maureen McKay sustained personal injuries in a motor vehicle accident on 26 November 2006.  Proceedings by which she claims damages against the person she alleges to be responsible for her injuries (Ian Ronald McKay) and his insurer have not yet been instituted.  

As a result of the accident Ms McKay sustained severe brain damage and she is now a person under a legal disability.

Some time ago the second respondent to this application, the insurer Suncorp, wrote to the applicant's solicitors advising that it was prepared to meet reasonable and appropriate cost of her rehabilitation pursuant to section 39(1)(a)(iv) of the Motor Accident Insurance Act. Subsequently it wrote to the applicant's solicitors advising that it was prepared to admit liability in full.

On 23 March 2009 Justice Atkinson made declarations pursuant to section 51(5)(b) of the Motor Accident Insurance Act as to the reasonableness and appropriateness of the rehabilitation services the respondent insurer ought to provide to the applicant in discharge of its rehabilitation obligations under section 51(1). In particular her Honour declared that in the circumstances of the case it would be reasonable and appropriate that rehabilitation services be made available to the applicant comprising funding to a limit of $425,000 for the demolition of her then residence and the construction of alternate premises on the site.

Since then it has been ascertained that the cost of demolition and construction of alternative premises will exceed that sum by approximately $109,000.

The second respondent, Suncorp Insurance, is willing to fund the additional $109,000 by way of an advance on the damages or settlement moneys which it anticipates ultimately having to pay, rather than as a rehabilitation measure.  The applicant's litigation guardian is satisfied that that is an appropriate way of dealing with the matter.

As I have said, the applicant sustained severe brain damage such that she is now a person under a legal disability.  She brings this proceeding by her litigation guardian, who is her daughter.  The first respondent (the person allegedly responsible for her injuries) is her husband.

In July 2007 the Guardianship and Administration Tribunal appointed the applicant's husband and her daughter as her joint administrators.

The application has been brought because the second respondent, Suncorp, asserts that it is a matter requiring the sanction of the Court pursuant to section 59(2) of the Public Trustee Act. I apprehend that Suncorp's real concern is to obtain a valid and binding receipt for the moneys and a legally binding assurance that the moneys will be deducted from the damages ultimately ordered or agreed to be paid.

While I can understand Suncorp's concern, I am not satisfied that this is a matter in relation to which the Court has the necessary power. 

As I understand the law, Suncorp is under no obligation to make this payment at this time.

Mr Grant-Taylor of Senior Counsel, who appears for the applicant, has submitted that it is being made without consideration.  Mr Jensen, the solicitor for Suncorp, has submitted that there is consideration, namely a compromise of rehabilitation rights.  I am not in a position to resolve that dispute. 

But, be that as it may, section 59(2) is in my view simply not engaged. That provision deals with "the settlement or compromise of a claim for money or damages by or on behalf of a person under a legal disability before proceedings are commenced. Such a settlement or compromise requires the sanction of a Court or the Public Trustee but no money or damages agreed to be paid in respect of the claim, whether by settlement or compromise, shall be paid to anyone other than 'the appropriate person' for the legally disabled person unless by direction of a Court." "Appropriate person" is defined in subsection (1A) as, in the circumstances of this case, the administrators.

Subsection (2) is not engaged because this is not a settlement or compromise out of Court of a claim for damages.
Accordingly I consider that the application ought to be dismissed.

Is there anything else, Mr Grant-Taylor?

MR GRANT-TAYLOR:  We have a draft order if your Honour pleases.

HER HONOUR:  Yes, please.  This draft order also requires the second respondent to pay the applicant's costs.  What do you say to that, Mr Jensen?

MR JENSEN:  I can't say anything against that.

HER HONOUR:  Very well, order as per draft.

MR JENSEN:  Thank you, your Honour.

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