Nick Zardo v Mate Ivancic

This is an action brought pursuant to s 66 of the Motor Accidents Act 1988 (NSW) to set aside a consent judgment obtained by the defendant, Mr Ivancic, against the plaintiff, Mr Zardo, in respect of a motor vehicle accident, which occurred in New South Wales on 3 July 1997. The basis for setting the consent judgment aside is that Mr Zardo claims that Mr Ivancic obtained the judgment by fraud. Mr Ivancic commenced proceedings in this Court by way of Originating Application filed on 29 August 1997. By Statement of Particulars dated 19 June 2000 and served on the plaintiff’s solicitors, who were acting on instructions from the Third Party motor insurer, NRMA Insurance, Mr Ivancic claimed that he was precluded from working due to significant soft tissue injuries and psychological difficulties arising from the motor vehicle accident. Mr Ivancic provided various medical reports in support of his claim, and he was examined by Doctors R McEwin and P Snowdon for the plaintiff. Settlement negotiations were entered into in about July 2000, and on 14 August 2000 terms of settlement were agreed which resulted in a judgment for Mr Ivancic against the plaintiff in the sum of $425,000 plus legal costs which were agreed at $30,000. The judgment was formally entered in this Court on 16 August 2000. There was evidence before me in this hearing that before the settlement NRMA had authorised video surveillance of Mr Ivancic, and a certain period of surveillance had been requested shortly before the settlement. Due to an administrative oversight, no one advised the investigator that the matter had settled and, acting on his previous instructions, the investigator continued, amongst other surveillance tasks, to monitor Mr Ivancic after the settlement. Video film was obtained of Mr Ivancic acting in a manner which, it is said by the plaintiff, was totally inconsistent with his claimed medical condition, and with the earlier video surveillance material obtained before the settlement. The plaintiff claims that Mr Ivancic grossly exaggerated and lied about the extent of his accident-related disabilities in order to improperly obtain a large judgment from the insurer. The Court found that Mr Ivancic knowingly made false or misleading statements to medical practitioners and to the insurer with the intention of obtaining a financial benefit. The Court found that the insurer was deceived by those statements when it acted on them to its detriment. The Court found that the insurer was not required to have full and complete knowledge of the fraud in order to obtain relief under s 66 of the Motor Accidents Act. The Court found that the insurer was entitled to be relieved of liability to pay the consent judgment to the extent of the financial benefit so obtained by Mr Ivancic, which was at least $350,000. The Court ordered that the plaintiff be relieved of liability under the consent judgment obtained in matter SC 619 of 1997 in the sum of $350,000, and ordered that Mr Ivancic pay the plaintiff’s costs of these proceedings.