Van Hemert v Smith

[2006] NSWDC 106

CITATION:	VAN HEMERT v SMITH [2006] NSWDC 106
HEARING DATE(S):	23 August 2006
JUDGMENT DATE:	29 August 2006
EX TEMPORE JUDGMENT DATE:	08/29/2006
JUDGMENT OF:	Sidis DCJ
DECISION:	1. Plaintiff’s motion dismissed; 2. Each party is to pay its own costs of that motion; 3. On the defendant’s motion, the defendant is granted leave to withdraw the admission of liability made by its third party insurer in a s 81 notice dated 22 October 2002; 4. The defendant is to pay the plaintiff’s costs of that motion.; 5. The exhibits and the affidavit evidence may be returned
CATCHWORDS:	Withdrawal of admission of breach duty of care
LEGISLATION CITED:	Motor Accidents Compensation Act 1988
CASES CITED:	Ness v Graffen (2003) 60 NSWLR 549 Maile v Rafiq [2005] NSWCA 410 @ [43]
PARTIES:	Stephen Hewlett VAN HEMERT Delma Marjorie SMITH
FILE NUMBER(S):	Newcastle 412 of 2005
COUNSEL:	Plaintiff D Benson Defendant P Cummings
SOLICITORS:	Plaintiff Reid & Reid Defendant Abbott Tout

JUDGMENT

1 In this matter there are two motions before the Court, a motion filed on behalf of the plaintiff on 23 November 2005 seeking to strike out paragraphs of the defence which deny liability to the plaintiff. The second motion was filed on behalf of the defendant on 29 December 2005 and it seeks leave to withdraw an admission of breach of duty of care made on 22 October 2002.

2 The plaintiff claims damages in respect of injuries suffered in a motor vehicle accident on 7 May 2002. The accident involved a collision between a vehicle driven by the plaintiff in the course of his employment and that driven by the defendant.

3 The plaintiff’s claim pursuant to the Motor Accidents Compensation Act 1988 was lodged with the defendant on 12 July 2002. S 81 of the Act required the defendant’s third party insurer to indicate its position on liability within a period of three months, that is, by 12 October 2002. On 22 October 2002, the third party insurer wrote to the plaintiff admitting liability.

4 The plaintiff proceeded with his claim on this basis until 7 March 2005 when his solicitors were informed that the defendant proposed to deny liability because the accident was inevitable. This change of position was based upon a report obtained by the defendant from Dr Mitchell, cardiologist, in which he stated an opinion that the defendant, at the time of the accident, had been rendered unconscious because of a heart condition of which she had been unaware. A statement of claim was subsequently filed and defended on this basis.

5 It was established in decisions of Ness v Graffen (2003) 60 NSWLR 549 and Maile v Rafiq [2005] NSWCA 410 at [43] that a s 81 admission may only be withdrawn in the interests of justice for good reason shown by evidence demonstrating a mistake by the defendant, change of circumstances, the ascertainment of further information, or misrepresentation.

6 Evidence in support of the application must be solid and substantial and provide a sensible explanation for the making of the relevant admission.

7 Consideration must also be given to the question of whether withdrawal of the admission would prejudice the plaintiff to the point where a fair trial on the issue of liability could not be obtained.

8 The evidence in this case concerning the circumstances in which the decision was made to admit liability came from Mr Brian Tiet, who had formerly been employed by the defendant’s third party insurer as an injury claims consultant. In his affidavit of 6 March 2006, Mr Tiet stated that, notwithstanding that the claim was lodged on 12 July 2002, a factual investigation report was not received until 9 October 2002. This delay was not explained. Mr Tiet’s investigation indicated the following:

1. The collision had occurred because the defendant’s motor vehicle travelled to the wrong side of the road.

2. The defendant had no recollection of events for some period prior to the accident.

3. There were no witnesses to the accident.

4. The plaintiff, when interviewed by police, stated that prior to the collision he saw that the defendant’s head was barely above the steering wheel. He said he did not know if this was because of the way in which she was sitting or whether she was slouched over the wheel.

5. The defendant disclosed no medical reason to explain why she might have lost consciousness prior to the accident.

9 A claim summary was completed by Mr Tiet. On this he wrote to the following effect:

Admit breach of duty of care, if medical from our insured can show inevitable, then apply then.

10 Mr Tiet explained that he had in fact been alerted to the need to consider a defence of inevitable accident by the facts that the collision occurred at high speed on the wrong side of the road. He said he expressed the view to his supervisor that no-one in their right mind would cross the road at 100 kilometres an hour. However, his decision, in the absence of medical evidence, and notwithstanding his suspicion in respect of the inevitability of the accident, was to admit liability and to withdraw the admission at a later stage if medical evidence became available.

11 The question is whether this was a sensible explanation for the decision made by Mr Tiet to admit liability. His options at the time were to deny or admit liability. It was submitted for the plaintiff that he had an option to admit liability conditionally but I do not accept that s 81 allows for such an approach.

12 In my view, in the absence of any real indication of a medical condition on the part of the defendant, the decision made by Mr Tiet to admit liability has to be described as a sensible one. This is so having particular regard to the terms of s 81, which impose a duty on a third party insurer to state its position on liability within a limited period of time.

13 The evidence solidly established that further information was subsequently obtained which is the foundation for the application to withdraw the admission.

14 The question remaining is whether the withdrawal of the admission would prejudice the plaintiff’s action. It was submitted on his behalf that his approach to his workers compensation rights might have been different had liability been denied from the outset. There was no evidence before me to this effect.

15 In my view, it has not been established that the plaintiff could not secure his own opinion in respect of the heart disease, if any, and its consequences, if any, to the defendant at the time of the accident, or that the quality of any such opinion would be affected by the delay in the denial of liability.

16 In the circumstances, I have been persuaded that it would be in the interests of justice that the leave sought be granted.

17 The orders which I make are as follows.

1. On the plaintiff’s motion, the motion is dismissed.

2. Each party is to pay its own costs of that motion.

3. On the defendant’s motion, the defendant is granted leave to withdraw the admission of liability made by its third party insurer in a s 81 notice dated 22 October 2002.

4. The defendant is to pay the plaintiff’s costs of that motion.

5. The exhibits and the affidavit evidence may be returned.

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