Proctor v QBE Insurance (Australia) Limited (No 2)
[2025] NSWPICMR 24
•28 August 2025
| CERTIFICATE OF DETERMINATION OF MERIT REVIEWER | |
| CITATION: | Proctor v QBE Insurance (Australia) Limited (No 2) [2025] NSWPICMR 24 |
| CLAIMANT: | Graeme Proctor |
| INSURER: | QBE Insurance (Australia) Limited |
| MEMBER AND MERIT REVIEWER: | Belinda Cassidy |
| DATE OF DECISION: | 28 August 2025 |
CATCHWORDS: | MOTOR ACCIDENTS - Motor Accident Injuries Act 2017; claim for statutory benefits; dispute about pre-accident weekly earnings (PAWE) determined by Merit Reviewer Ruschen; both parties made application for costs beyond the scheme in the Motor Accident Regulation 2017 (the Regulation) which did not allow any costs for a PAWE dispute; insurer agreed to claimant’s entitlement to costs and quantum of those costs; Held – Member determined under section 8.3(4) insurer entitled to costs beyond the Regulation; Member determined under section 8.10 claimant entitled to costs beyond the Regulation; in the role of Merit Reviewer the claimant’s costs were assessed at $2,840 inclusive of GST. |
| DETERMINATIONS MADE: | CERTIFICATE OF DETERMINATION In accordance with Part 7 of the Motor Accident Injuries Act 2017, the assessment of the Miscellaneous Claims Assessment and Merits Review matters are: 1. The insurer’s legal representatives are, in accordance with s 8.3(4), permitted to payment of the legal costs for legal services provided to the insurer in respect of the dispute about the claimant’s pre-accident weekly earnings. 2. The claimant is entitled to recover from the insurer the legal costs incurred by him in respect of the dispute about the claimant’s pre-accident weekly earnings. 3. The amount of the claimant’s costs in the matter is assessed at $2,840.20 inclusive of GST. A statement setting out the Commission’s reasons for the assessment is included with this certificate. |
STATEMENT OF REASONS
INTRODUCTION
Graeme Proctor was involved in a motor accident on 15 November 2024. He made a claim for statutory benefits under the Motor Accident Injuries Act 2017 (the MAI Act) against QBE, the third-party insurer of the vehicle. QBE accepted the claim and its liability to pay Mr Proctor the benefits to which he is entitled.
Mr Proctor lives in rural NSW near Albury. He was, at the time of the accident close to 76 years of age and a farmer.
On 9 April 2025 the insurer determined the claimant was an earner but that his pre-accident average weekly earnings (PAWE) was nil.
On 21 May 2025, the insurer’s internal reviewer determined the claimant’s PAWE was $596.46 which the claimant disputed.
On 19 June 2025 the claimant, through his solicitors, lodged an application for Merit Review with the Personal Injury Commission (the Commission). On 20 August 2025, Merit Reviewer Ruschen determined that the claimant’s PAWE was $651.71 per week[1].
[1] At the time these reasons were issued Merit Reviewer Ruschen’s decision had not been published.
Merit Reviewer Ruschen referred the matter back to the Commission for a determination as to the parties’ entitlement to costs and that matter was allocated to me for assessment. I held a teleconference with the legal representatives on 27 August 2025.
LEGISLATIVE FRAMEWORK
General
The MAI Act establishes in Part 3 a scheme for benefits and compensation to be paid to persons injured in motor accidents in New South Wales. Statutory benefits include weekly income replacement type benefits in accordance with Division 3.3 as well as treatment and care benefits pursuant to Division 3.4.
Part 8 of the MAI Act concerns costs and fees payable. The provisions relevant to the matters the subject of the current proceedings are as follows:
(a) there is power to make regulations fixing the maximum amount of legal services or related expenses that can be paid and the power to declare matters for which no costs are payable (s 8.3(1));
(b) legal practitioners are not entitled to be paid or recover costs beyond the regulated amounts and are not entitled to payment or recovery if it is declared that no costs are payable (s 8.3(3)) but are entitled to be paid or recover legal costs if the regulations or the Commission permits it (s 8.3(4);
(c) in a statutory benefits claim, the claimant is entitled to recover reasonable and necessary legal costs (and other costs) from the insurer (s 8.10(1));
(d) the regulations can specify a maximum amount of costs or specify that no costs are payable (s 8.10(2));
(e) claimants can only recover legal costs if payment is permitted by the regulation or the Commission (s 8.10(3)), and
(f) the Commission can permit payment of costs if the claimant is a person under legal incapacity or if exceptional circumstances exist (s 8.10(4)).
Dispute resolution
Schedule 1 of the Motor Accident Injuries Regulation 2017 (the Regulation) declares that certain disputes are regulated merit review, medical assessment or miscellaneous claims assessment matters for which costs are payable. Disputes about PAWE are not included in the list of regulated merit review matters which means, by operation of s 8.3(4) and s 8.10(3), that no costs are payable or recoverable by either parties’ legal representatives unless the Commission permits it.
In terms of the entitlement to costs outside the Regulation, it is the Commission that has power to make that decision for these reasons:
(a) pursuant to s 24 of the Personal Injury Commission Act 2020 (the PIC Act) the Commission has the jurisdiction and functions given to it under the MAI Act;
(b) section 31(1) says that the Commission is constituted by one or more members;
(c) merit reviewers are not members, but they are decision-makers appointed under s 33 of the PIC Act and in accordance with that section have functions conferred under the PIC Act or the MAI Act, and
(d) section 8.3(4) and 8.10(4) of the MAI Act confer a function on the Commission (which is constituted by a member), but not on merit reviewers or any other other decision-makers.
In terms of the quantum of the claimant’s costs beyond the regulated amounts, schedule 2(1)(aa) of the MAI Act declares that to be a merit review matter. There is however no power in the MAI Act for a Member or a decision-maker to assess the quantum of the insurer’s legal representative’s costs
CONSIDERATION OF THE ISSUES
What is claimed and what is in dispute?
The insurer in its submissions accepts that the claimant should be permitted costs beyond the scheme in the Regulation under s 8.10 of the MAI Act.
The insurer’s legal representative seeks costs beyond the scheme in the Regulation under s 8.3 of the MAI Act.
At the teleconference held with the parties, Ms Campbell advised that the claimant seeks costs in the following sums:
(a) professional legal costs which are claimed in the sum which would have been available had the dispute been a regulated merit review or miscellaneous claims assessment matter (16 monetary units currently $1,992 plus GST)), and
(b) the cost of obtaining taxation returns and business information from the claimant’s accountant in the sum of $649.00 including GST.
Mr Malley advised that the insurer agreed that those sums were, if permitted, reasonable and necessary.
As I hold both an appointment as a Member of the Commission and as a Merit Reviewer, I advised the parties I would determine both the parties’ entitlement to costs beyond the Regulation and in terms of the claimant’s costs, the quantum of those costs.
Are the parties entitled to costs beyond the Regulation?
I am satisfied that the claimant is entitled to costs beyond the Regulation because there are exceptional circumstances in the claim which justify the costs incurred for the following reasons:
(a) the claimant’s application was successful and the claimant’s PAWE was increased and therefore his statutory benefits were increased;
(b) the claimant was a farmer with both his own business and a business he operated in partnership with someone else;
(c) his partner had died in the year before the accident;
(d) there was uncertainty as to which subclause of clause 4 of Schedule 1 of the MAI Act applied, and
(e) the calculation of earnings was complicated by the dual sources of income and required input from a forensic accountant (for the insurer) and documents from the claimant’s accountants.
I am also satisfied that the insurer is entitled to costs beyond the Regulation because of the complications and complexities in the claimant’s employment and business arrangements as noted above and the insurer’s need to obtain a forensic accountant’s report.
What is the quantum of the claimant’s costs?
The claimant is only permitted to recover the reasonable and necessary legal costs in a matter.
The activities and stages of the dispute were as follows:
(a) there was an initial application comprising 26 pages of documents lodged on or about 19 June 2025 and short submissions were typed into the application form;
(b) the application was accepted, and a timetable was issued by the Commission on 23 June 2025;
(c) the insurer filed a notice of representation on 30 June 2025, a reply form and on 8 July 2025 a bundle of more than 200 pages of documents comprising submissions, a forensic accountant’s report and financial records;
(d) on 15 July 2025 the Merit Reviewer issued directions to the parties for submissions and advised the parties the matter would be decided on the papers unless someone requested a teleconference;
(e) on 30 July 2025 further submissions were lodged by the claimant;
(f) on 14 August 2025 the insurer uploaded very brief submissions, and
(g) on 20 August 2025 the Merit Review issued her decision comprising 11 pages.
It was reasonable and necessary for the above steps to be taken which required the claimant’s solicitor to take action for example by lodging the application, reading the insurer’s reply and submissions, liaising with the Commission and reviewing the Merit Reviewer’s decision.
In the light of the insurer’s agreement and on my own consideration of the work done in this matter, I am satisfied that the sum of $1,992 is a fair sum for all of the above activities to which GST of $199.20 must be added. I am also of the view the fee for the claimant’s accountant’s services in the sum of $649 is reasonable and necessary in the light of the complexity of the claimant’s business arrangements.
The total of the sum of costs recoverable by the claimant from the insurer is $2,840.20 inclusive of GST.
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