Paget v AAI Limited t/as Suncorp Insurance
[2022] NSWPIC 650
•23 November 2022
| CERTIFICATE OF DETERMINATION OF MEMBER | |
Citation: | Paget v AAI Limited t/as Suncorp Insurance [2022] NSWPIC 650 |
| Claimant: | Luke Paget |
| insurer: | AAI Limited t/as Suncorp Insurance |
| Member: | Brett Williams |
| DATE OF DECISION: | 23 November 2022 |
CATCHWORDS: | MOTOR ACCIDENTS - Interim decision; in submissions lodged with its reply, the insurer argued that the claimant had failed to comply with sections 7.32(3) and 7.33 of the Motor Accident Injuries Act 2017 (2017 Act); where entitlement to non-economic loss was in dispute; the claimant had sought a concession from the insurer on multiple occasions that his permanent impairment was greater than 10%; claim initially referred to the Personal Injury Commission (Commission) for assessment within three years but application subsequently dismissed due to Federal issues; further application for assessment lodged after three years; exceptional costs order sought; Held – the claimant did use his best endeavours to settle his claim before he referred it to the Commission; it was not reasonable to expect the claimant to make an offer of settlement, or engage in settlement discussions, in circumstances where his entitlement to non-economic loss remained in dispute; the claimant has provided a full and satisfactory explanation for the delay in referring his claim to the Commission for assessment; leave granted for the claim to be referred for assessment; it is clear from the terms of section 8.10 of the 2017 Act that the section only applies to a claim for statutory benefits, and does not apply to a damages claim; no power to allow costs under section 8.10(4)(b) of the 2017 Act in relation to these proceedings. |
determinations made: | 1. Having considered Procedural Direction MA1, and noting the outstanding medical dispute, I refer the proceedings to the stood over list. |
background
Luke Paget (the claimant) was injured in a motor accident on the Tweed Valley Freeway on 19 March 2019. He subsequently made a claim for damages on AAI Limited t/as Suncorp (the insurer). The claimant has referred his claim for damages to the Commission for assessment.
In submissions lodged with its reply, the insurer raised issues in relation to both s 7.32(3) and s 7.33 of the Motor Accident Injuries Act 2017 (MAI Act). With respect to s 7.32(3), the insurer says that the claimant did not use his best endeavours to settle the claim before referring it for assessment. The claimant disputes that this is the case.
There is also an issue as to whether s 7.33 is engaged in circumstances where the claim was first referred to the Commission for assessment on 8 March 2022 (within three years of the accident), dismissed because of issues relating to Federal jurisdiction, and referred to the Commission again on 23 May 2022 (more than three years after the accident).
on the papers
At the preliminary conference held on 20 September 2022 the parties agreed that the disputes in relation to both s 7.32(3) and s 7.33 can be determined on the papers. Having considered s 52 of the Personal Injury Commission Act 2020 (PIC Act) and Procedural Direction PIC2 I have concluded that the disputes can be determined on the papers. I am satisfied that sufficient information is available in connection with the disputes to allow me to determine the issues without holding a formal hearing.
Submissions
Insurer’s submissions
In submissions lodged with its reply, the insurer argued that the claimant did not use his best, or any, endeavours to settle the claim before referring it to the Commission for assessment. Accordingly, the insurer argues that these proceedings do not comply with s 7.32(3) of the MAI Act. The insurer’s submissions refer, at [6]-[13], to a number of authorities in support of its submission.
As a consequence of the claimant’s purported failure to use his best endeavours to settle the claim, the insurer submits that, for the reasons contained at [18]-[31] of its submissions, the Commission has the power to dismiss the proceedings, and should exercise that power.
The insurer also submits that, as the proceedings were referred to the Commission for assessment more than three years after the accident, the claimant is required to provide a full and satisfactory explanation for the delay, as required by s 7.33 of the MAI Act.
In its further submissions, the insurer states that it would not oppose leave being granted under s 7.33 should the Commission be content, firstly, to accept the claimant’s submissions lodged on 5 October 2022 as the required “explanation”, and, secondly, that it was appropriate for the claimant to attempt to persuade the Commission to reinstate the dismissed proceedings rather than commence Court proceedings. The insurer’s submissions record that, whilst it would not cavil with a finding in favour of the claimant on both issues, it is ultimately a matter for the Commission. It is convenient at this juncture to record that I accept the claimant’s submissions, together with the documents attached to the submissions, as his explanation for the delay for the purposes of s 7.33.
As to s 7.32(3) of the MAI Act, in its further submissions the insurer maintains that no endeavour was made by the claimant to settle his claim before referring it to the Commission for assessment. It is argued that the claimant made no offer of settlement to the insurer or enquiry as to whether the insurer was prepared to enter into settlement negotiations prior to the commencement of proceedings. As the claimant made no endeavours to settle his claim before referring it for assessment, the insurer submits he is in breach of s 7.32(3) of the MAI Act.
Claimant’s submissions
In his submissions dated 27 September 2022, the claimant submits that it would be unreasonable to expect him to settle his claim when assessment of his permanent impairment remains in dispute. He argues that, in seeking a concession from the insurer that his permanent impairment exceeded 10%, thus entitling him to an award for non-economic loss, he did use his best endeavours to settle the claim. In this regard, the claimant refers to correspondence from his solicitors to the insurer dated 16 December 2020, 21 January 2021 and 14 May 2021, wherein he sought a concession in relation to his permanent impairment exceeding 10%. Having received no response from the insurer, on 16 August 2021 the claimant requested an internal review in relation to the concession he sought with respect to his permanent impairment.
The claimant’s submissions record that he subsequently lodged an application with the Commission for assessment of his permanent impairment. The claimant’s submissions record that the insurer has not at any stage conceded that his permanent impairment is greater than 10%.
The claimant submits that, given his entitlement to non-economic loss remains in dispute, it should be found that he used his best endeavours to resolve the claim before referring it to the Commission for assessment.
As to s 7.33, the claimant’s submissions record, and I accept, that his claim was initially referred to the Commission for assessment on 8 March 2022, less than three years after the accident. The application was dismissed on 30 March 2022 because it was said that a “federal issue” arose. A further application, referring the claim to the Commission for assessment, was lodged on 23 May 2022.
The claimant’s primary submission is that, given the circumstances referred to at [28] - [44] of his submissions, an issue does not arise under s 7.33 of the MAI Act. In the alternative, the claimant argues that he has provided a full and satisfactory explanation for the delay in referring his claim to the Commission more than three years after the accident.
determination
Section 7.32(3)
Section 7.32(3) of the MAI Act states that parties to a claim must use their best endeavours to settle the claim before referring it for assessment under Division 7.6 of the MAI Act. As I observed in Mammone v Insurance Australia Limited t/as NRMA [2021] NSWPIC 501 at [49], what constitutes “best endeavours”, for the purposes of s 7.32(3), must depend on the circumstances of each claim. The provision may not require an offer of settlement to be made in every case.
It is evident to me that, with respect to his claim for damages, the claimant seeks an allowance for non-economic loss. He sought, on three occasions, a concession from the insurer that his permanent impairment as a result of injuries caused by the accident was greater than 10%: see 4.11 MAI Act.
Having received no reply from the insurer with respect to the concession he sought, the claimant requested an internal review. An internal review was not undertaken, and the claimant ultimately brought the matter to a head by making an application to the Commission for assessment of his permanent impairment.
In circumstances where the insurer failed to respond to the claimant’s request for a concession in relation to his permanent impairment, I consider it was reasonable for the claimant to proceed on the basis that his entitlement to non-economic loss was in dispute. I also consider it reasonable for him to proceed on the basis that, until an assessment of his permanent impairment had been made by a Medical Assessor under Div 7.5 of the MAI Act, the issue remained in dispute.
In these circumstances, I find that the claimant did use his best endeavours to settle his claim before he referred it to the Commission on both occasions (8 March 2022 and 23 May 2022). I find that, for the purposes of s 7.32(3), using his best endeavours to settle his claim did not require the claimant to make an offer of settlement, or engage in settlement discussions, in circumstances where his entitlement to non-economic loss remained in dispute.
Section 7.33
The application made by the claimant on 8 March 2022, by which he referred his claim for damages to the Commission for assessment, was dismissed by the Commission on 30 March 2020. In these circumstances, I find that the claimant’s application, referring his claim for assessment, made on 23 May 2022 was a fresh application. As his claim was referred to the Commission for assessment more than three years after the accident, s 7.33 must be addressed.
Section 7.33 states that:
“A party to a claim cannot refer a claim for assessment under this Division 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.”
The claimant must provide a full and satisfactory explanation for the delay in referring his claim to the Commission for assessment. I find that the delay arose as a result of the application made on 8 March 2022 being dismissed due to “Federal issues”. I find that a further application for assessment of damages was lodged on 23 May 2022, after the District Court published its decision in Stanton v Winning [2022] NSWDC 104 (Stanton) on 11 April 2022.
Although the explanation for the delay is provided in the form of submissions, relevant correspondence, that substantiates critical matters raised in the submissions, is attached to the submissions. I find that the explanation for the delay is complete in the sense that it says what happened and why: Walker v Howard [2009] NSWCA 408 at [104].
I am satisfied that the explanation provided enables me to evaluate the reasons for the delay. I find that the explanation is full.
I am satisfied that the delay was reasonably justifiable. The claimant initially referred his claim to the Commission for assessment within three years of the accident. It was dismissed due to no default on the part of the claimant. The late application was made within a short period after Stanton was decided by the District Court.
I find that, for the purposes of s 7.33 of the MAI Act, the claimant has provided a full and satisfactory explanation for the delay in referring his claim to the Commission for assessment. Leave is granted for the claim to be referred for assessment.
costs
The claimant seeks an order for the payment of “extraordinary costs” in connection with the preliminary conference held on 20 September 2022 and the preparation of submissions addressing s 7.32 and s 7.33. I have assumed that reference to “extraordinary costs” is a reference to “exceptional circumstances”, found in s 8.10(4)(b) of the MAI Act.
Section 8.10 is, relevantly, in the following terms:
“8.10 Recovery of costs and expenses in relation to claims for statutory benefits
(1) A claimant for statutory benefits is (subject to this section) entitled to recover from the insurer against whom the claim is made the reasonable and necessary legal costs, and other costs and expenses, incurred by the claimant in connection with the claim. Other costs and expenses include the cost of medical and other tests and reports.
(2) …
(3) A claimant for statutory benefits is only entitled to recover from the insurer against whom the claim is made reasonable and necessary legal costs incurred by the claimant if payment of those costs is permitted by the regulations or the Commission.
(4) The Commission can permit payment of legal costs incurred by a claimant but only if satisfied that—
(a) ..
(b) exceptional circumstances exist that justify payment of legal costs incurred by the claimant.
(5) …”
It is clear from the terms of s 8.10 that the section only applies to a claim for statutory benefits, and does not apply to a damages claim. Accordingly, there is no power to allow costs under s 8.10(4)(b) in connection with these proceedings, which relate to a claim for damages.
The proceedings are refeRred to the stood over list
As there is an outstanding medical dispute about permanent impairment the matter is not ready to be set down for assessment. At the preliminary conference the parties agreed that if the proceedings remain on foot they should be referred to the stood over list.
Having considered Procedural Direction MA1, and noting the outstanding medical dispute, I refer the proceedings to the stood over list.
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