AAI Limited v Singh

The dispute regarding Pt 3 of the Act

1. For a period of 26 weeks following the accident Mr Singh received from the plaintiff weekly payments under Div 3.3 of the Act to replace lost earnings. He also received treatment and medical expenses under Div 3.4. At the end of the 26 week period the plaintiff ceased paying these statutory benefits. To explain the dispute between the parties and how it has found its way to this Court it is necessary to refer to substantial portions of the Act, as follows: 2.3 Third-party policies A third-party policy under this Act is a policy that is in the following terms: Third-party Policy The insurer insures the owner of the motor vehicle and any other person who at any time drives the vehicle (whether or not with the consent of the owner) against liability in respect of the death of or injury to a person caused by the fault of the owner or driver of the vehicle: (a) if the motor vehicle is not one to which paragraph (b) applies - in the use or operation of the vehicle in any part of the Commonwealth (whether or not on a road), or (b) if the motor vehicle is subject to an unregistered vehicle permit under the Road Transport Act 2013 - in the use or operation of the vehicle on any road in any part of the Commonwealth. In this policy, words and expressions have the same meanings as in the Motor Accident Injuries Act 2017. Part 3 Statutory benefits Division 3.1 Entitlement to statutory benefits 3.1 Statutory benefits payable in respect of death or injury resulting from motor accident (1) If the death of or injury to a person results from a motor accident in this State, statutory benefits are payable in respect of the death or injury as provided by this Part. (2) Statutory benefits are payable (except as otherwise provided by this Part): (a) whether or not the motor accident was caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle, or (b) even if the motor accident was caused by the fault of the person to whom the statutory benefits are payable. 3.2 Statutory benefits payable by relevant insurer (1) The statutory benefits payable under this Part are payable by the relevant insurer. (2) The relevant insurer is (subject to this section and section 3.3): (a) if the motor accident concerned involved only 1 motor vehicle with motor accident insurance cover - the insurer of the motor vehicle, or (b) if the motor accident concerned involved more than 1 motor vehicle - the insurer of the at-fault motor vehicle, or (c) in any other case - the Nominal Defendant. … (5) For the purposes of this Act (including any motor accident insurance cover in respect of a motor vehicle) a liability that the relevant insurer has to pay statutory benefits under this Part in respect of death or injury is deemed to be a liability in respect of death or injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle (being a motor vehicle for which the insurer is the relevant insurer). Division 3.3 Weekly payments of statutory benefits to injured persons [3.5-3.10 provisions for "an earner who is injured as a result of a motor accident and suffers a total or partial loss of earnings as a result of the injury" to be "entitled to weekly payments of statutory benefits" at varying rates in weeks 1-13 after the accident, weeks 14-78 after the accident and the period after week 78] 3.11 Cessation of weekly payments to injured persons most at fault or with minor injuries after 26 weeks (1) An injured person is not entitled to weekly payments of statutory benefits under this Division for any period of loss of earnings or earning capacity that occurs more than 26 weeks after the motor accident concerned if: (a) the motor accident was caused wholly or mostly by the fault of the person, or (b) the person's only injuries resulting from the motor accident were minor injuries. (2) A motor accident was caused mostly by the fault of a person if the contributory negligence of the person in relation to the motor accident (as referred to in section 3.38) was greater than 61%. Division 3.4 Statutory benefits for treatment and care [3.24-3.27 provisions for "an injured person" to be "entitled to statutory benefits for [defined expenses] incurred in connection with providing treatment and care for the injured person"] 3.28 Cessation of statutory benefits after 26 weeks to injured adult persons most at fault or to injured persons with minor injuries (1) An injured person is not entitled to statutory benefits under this Division for treatment and care expenses incurred more than 26 weeks after the motor accident concerned if: (a) the motor accident was caused wholly or mostly by the fault of the person and the person was over 16 years of age at the time of the motor accident, or (b) the person's only injuries resulting from the motor accident were minor injuries. (2) A motor accident was caused mostly by the fault of a person if the contributory negligence of the person in relation to the motor accident (as referred to in section 3.38) was greater than 61%. …
2. Definitions relevant to the above extracts are given in s 1.4 as follows: damages means damages (within the meaning of the Civil Liability Act 2002) in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle, but does not include statutory benefits. fault means negligence or any other tort. motor accident means an incident or accident involving the use or operation of a motor vehicle that causes the death of or injury to a person where the death or injury is a result of and is caused (whether or not as a result of a defect in the vehicle) during: (a) the driving of the vehicle, or (b) a collision, or action taken to avoid a collision, with the vehicle, or (c) the vehicle's running out of control, or (d) a dangerous situation caused by the driving of the vehicle, a collision or action taken to avoid a collision with the vehicle, or the vehicle's running out of control. statutory benefits means statutory benefits payable under Part 3.
3. When the plaintiff ceased to pay statutory benefits to Mr Singh it contended that by force of s 3.2(5) the accident was deemed to have been caused wholly by his fault, so that s 3.11(1)(a) and s 3.28(1)(a) were engaged and he was no longer entitled to the benefits. Mr Singh disputed this. The issue fell within cl 3(d) and (e) of Schedule 2 to the Act, thereby constituting a "miscellaneous claims assessment matter" for the purposes of Pt 7. At Mr Singh's request the plaintiff conducted an internal review of its decision, under s 7.9(1)(c), but on 12 October 2018 the plaintiff affirmed its decision.
4. Mr Singh then applied to the Dispute Resolution Service, established under s 7.2 of the Act, for determination of his claim for continuance of statutory benefits more than 26 weeks after the accident. Having obtained a decision on an internal review, as required by s 7.41, Mr Singh was entitled to have the dispute referred to an assessor under s 7.42. The second defendant was allocated to assess the claim. After considering submissions from both parties, on 13 February 2019 the second defendant issued a certificate stating her findings that, for the purposes of ss 3.11 and 3.28 of the Act, "the motor accident was not caused by the fault of Mr Singh".

The plaintiff's summons

1. The principal claims for relief in the plaintiff's summons filed 25 March 2019 are to the following effect: 1. An order in the nature of certiorari quashing the second defendant's decision. 2. An order in the nature of prohibition to prevent the State Insurance Regulatory Authority acting on the decision. 3. A declaration that Mr Singh's claim for statutory benefits is governed by Pt 5 of the Act. 4. A declaration that for the purposes of Mr Singh's claim for statutory benefits, his injuries are deemed pursuant to s 3.2(5) and s 5.2 of the Act to have been caused by his fault. 5. A declaration that Mr Singh is not entitled to receive statutory benefits beyond 26 weeks from the date of the accident, by force of ss 3.11 and 3.28 of the Act.

The contention that s 3.2(5) deems Mr Singh wholly at fault

1. The effect of s 3.1 is that statutory benefits are payable to a person who is injured in a motor accident notwithstanding that it was not caused by the fault of the owner or driver of any motor vehicle in the use or operation of that vehicle and even if the injury was caused by the fault of the injured person himself or herself. In the present case, on the basis of the evidence and as a matter of fact, the accident was not caused by the fault of the owner or driver of any motor vehicle. Before the assessor the plaintiff agreed that that was so. Paragraph (a) of s 3.1(1) dictates that statutory benefits are nevertheless payable to Mr Singh.
2. As only one motor vehicle was involved in the subject accident s 3.2 has the effect that the CTP insurer of that vehicle is the "relevant insurer" and must pay the statutory benefits to the injured person, Mr Singh. This obligation to pay statutory benefits is in addition to the insurer's obligations under the statutory insuring clause in s 2.3. By that statutory clause the insurer must indemnify the owner and any driver of the insured vehicle against "liability in respect of the death or injury to a person caused by the fault of the owner or driver of the vehicle" in the "use or operation of the vehicle" (emphasis added). Sections 3.1 and 3.2 widen the insurer's obligation by requiring it to pay statutory benefits in respect of injury regardless of whether that injury was "caused by the fault of the owner or driver of the [insured] vehicle".
3. Section 3.2(5) deems that this additional obligation to pay statutory benefits is within the statutory insuring clause. To repeat, s 3.2(5) provides, with respect to the liability of the insurer to pay statutory benefits under Pt 3 (specifically, ss 3.1 and 3.2): a liability that the relevant insurer has to pay statutory benefits under this Part in respect of death or injury is deemed to be a liability in respect of death or injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle (being a motor vehicle for which the insurer is the relevant insurer) (emphasis added).
4. The words in bold in this deeming provision are equivalent to the words highlighted at [10] above from the statutory insuring clause in s 2.3. Section 3.2(5) has the effect of deeming that a statutory liability of the insurer to make certain payments, created by ss 3.1 and 3.2, is a liability within the reach of the statutory insuring clause that otherwise would not extend to it. The plaintiff submits that, because Mr Singh was the driver of the vehicle whose insurer is bound under s 3.2 to pay the statutory benefits payable under s 3.1, therefore s 3.2(5) deems Mr Singh to have been wholly at fault in the motor accident, notwithstanding that as a matter of fact he was blameless. I do not accept that submission. Section 3.2(5) is concerned with deeming where financial liability lies, not with deeming that any person is at fault, in any situation.
5. It is not clear why the legislature should have considered it necessary to deem the liability for statutory benefits that it has created under ss 3.1 and 3.2 to be a liability falling within the statutory insuring clause at s 2.3. It is unclear why it should not have been thought sufficient simply to create this additional liability of insurers as a freestanding statutory obligation under ss 3.1 and 3.2. Whatever the reason for enacting s 3.2(5), its effect is to deem that the additional statutory obligation is within the insuring clause, and no more. It does not, either in express terms or by implication or necessary intendment, have the effect of deeming any person to have been at fault in any situation to which s 3.2 may apply.
6. It follows that, unless some other part of the Act produces a different result, the motor accident giving rise to Mr Singh's claim for statutory benefits was not brought about "wholly or mostly" by his own fault as a result of statutory deeming by force of s 3.2(5) and his statutory benefits therefore do not stop at 26 weeks by force of ss 3.11(1)(a) and 3.28(1)(a).

Interpretation of Pt 5

1. As can be seen from pars (3) and (4) of the relief claimed by the plaintiff, it contends that Pt 5 governs Mr Singh's claim and has the effect of attributing to him fault in the accident, so that he is disentitled from the benefits after 26 weeks by the operation of ss 3.11 and 3.28. To appreciate the argument it is necessary to consider the whole of Pt 5, as follows (emphasis added): Part 5 Recovery for no-fault motor accidents 5.1 Definition of "no-fault motor accident" (cf s 7A MACA) In this Part: no-fault motor accident means a motor accident in the State not caused by the fault of the owner or driver of any motor vehicle involved in the accident in the use or operation of the vehicle and not caused by the fault of any other person. 5.2 Liability in case of no-fault motor accident (cf s 7B MACA) (1) The death of or injury to a person that results from a no-fault motor accident involving a motor vehicle that has motor accident insurance cover for the accident (within the meaning of section 1.10) is, for the purposes of and in connection with any claim for damages or statutory benefits in respect of the death or injury, deemed to have been caused by the fault of the owner or driver of the motor vehicle in the use or operation of the vehicle. (2) If the no-fault motor accident involved more than one motor vehicle that has motor accident insurance cover for the accident (within the meaning of section 1.10), the death or injury is deemed to have been caused by the fault of the owner or driver of each of those motor vehicles in the use or operation of the vehicle. 5.3 Presumption that motor accident is no-fault (cf s 7C MACA) (1) In proceedings on a claim for damages in respect of the death of or injury to a person resulting from a motor accident, an averment by the plaintiff that the motor accident was a no-fault motor accident is evidence of that fact in the absence of evidence to the contrary. (2) In connection with an application for statutory benefits in respect of the death of or injury to a person resulting from a motor accident, a declaration by the applicant that the motor accident was a no-fault motor accident is evidence of that fact in the absence of evidence to the contrary. 5.4 No recovery of damages for driver who caused accident (cf s 7E MACA) (1) There is no entitlement to recover damages because of the operation of this Part in respect of the death of or injury to the driver of a motor vehicle if the motor accident concerned was caused by an act or omission of that driver. (2) The death of or injury to a person is taken to have been caused by an act or omission of the driver for the purposes of subsection (1) even if: (a) the act or omission does not constitute fault by the driver in the use or operation of the vehicle, or (b) the act or omission was involuntary, or (c) the act or omission was not the sole or primary cause of the death or injury. 5.5 Contributory negligence (cf s 7F MACA) This Part does not prevent the reduction of damages or statutory benefits by reason of the contributory negligence of the deceased or injured person. 5.6 Recovery of contribution to damages or statutory benefits from person actually at fault (cf s 7G MACA) A person whose liability for damages or statutory benefits in respect of the death of or injury to a person results from the person being deemed under this Part to be a person whose fault caused the death or injury is entitled to recover contribution in respect of that liability from a person (whether or not the driver of a motor vehicle) whose fault actually caused the death or injury. 5.7 No recovery by Nominal Defendant unless owner or driver actually at fault (cf s 7H MACA) The Nominal Defendant is not entitled to recover any amount under section 2.37 (Recovery from owner or driver) from the owner or driver of a motor vehicle in respect of amounts properly paid by the Nominal Defendant in connection with the operation of this Part unless the motor accident concerned was actually caused by the fault of the owner or driver of the motor vehicle in the use or operation of the vehicle. 5.8 Other entitlements not affected (cf s 7I MACA) This Part does not affect any entitlement to damages or statutory benefits apart from this Part.
2. The provisions of Pt 5 use the alternatives "death or injury" in a number of places and they refer to both single vehicle and multiple vehicle accidents. I will consider these sections, quote from them and refer to them only to the extent that they apply to cases of injury, not death, and cases of accidents involving one insured vehicle, not multiple vehicles. That will simplify the reasoning to so much the Act as is relevant for present purposes, having regard to the facts of the case.
3. A problem with Pt 5 is the direct contradiction between s 5.1 and s 5.6. "No-fault motor accident" is defined in s 5.1 to mean an accident that is not caused by the fault of an owner or driver of a vehicle involved in the accident or "by the fault of any other person". Pursuant to s 5.2, injury that results from a "no-fault motor accident" involving only one insured motor vehicle is "deemed to have been caused by the fault of the owner or driver of [that] motor vehicle" in its "use or operation". The effect of this deeming provision is to cause the statutory insuring clause in s 2.3 to respond. Section 5.6 purports to confer upon the owner or driver an entitlement to recover contribution in respect of the "liability for damages or statutory benefits" that arises from the fault of the owner or driver, deemed under s 5.2.
4. The right of contribution under s 5.6 is against "a person (whether or not the driver of a motor vehicle) whose fault actually caused the … injury". By force of the definition of "no-fault motor accident" in s 5.1, there can be no person "whose fault actually caused the … injury" in relation to any motor accident to which Pt 5 applies. Section 5.6 is expressly engaged only for the benefit of a person whose liability is "deemed under this Part". Therefore it only operates in relation to "no-fault motor accidents" for which there is, by definition, no person "whose fault actually caused the … injury". The apparently clear meaning of the definition of a "no-fault motor accident" has the effect that the purported right of third-party recovery under s 5.6 is illusory.
5. The contradiction between ss 5.1 and 5.6 has assumed importance in the present case because the plaintiff submits that the accident in which Mr Singh was injured was a "no-fault motor accident", so that s 5.2(1) is engaged. The plaintiff submits that s 5.2(1) has the effect that the accident is deemed to have been caused by the fault of Mr Singh, so that ss 3.11(1)(a) and 3.28(1)(a) are also engaged, disentitling him from statutory benefits beyond 26 weeks. Mr Singh on the other hand contends that this was not a "no-fault motor accident" because it was "caused by the fault of any other person", namely, the person or persons who negligently stowed the container so that the load moved and caused his prime mover and trailer to roll.
6. Part 5 follows closely Div 1 of Pt 1.2 of the Motor Accidents Compensation Act 1999 (NSW), comprising ss7A-7I. The correlation is indicated in the heading to each section of Pt 5 of the Motor Accidents Injuries Act. The definition of "blameless accident" in s 7A of the former Act was closely similar to that of "no-fault motor accident" in s 5.1. Section 7G was closely similar to s 5.6. The same contradiction existed between ss 7A and 7G as exists between ss 5.1 and 5.6. This was observed in Axiak v Ingram [2012] NSWCA 311 at [25] (Tobias AJA, Beasley JA and Sackville AJA agreeing). Tobias AJA noted a variance of language between sections of the Motor Accidents Compensation Act, which at times referred to fault in the causation of injury and at times to fault in the causation of an accident. A similar variance may be seen in ss 5.1, 5.2 and 5.6. This does not resolve the contradiction between ss 5.1 and 5.6.
7. The plaintiff submitted that the words "any other person" at the end of the definition of "no-fault motor accident" in s 5.1 should be read down or narrowed, to leave open that a motor accident could still be within the definition of "no-fault" if it was to some degree caused or contributed by a person who is outside the class of "any other person". Counsel was unable to provide any meaningful formula by which the words "any other person" could be narrowed to achieve this object. I am likewise unable to formulate such an interpretation. The task is impossible. There is no intelligible qualification by which the words "any other person" can be made to yield a meaning to the effect of "any other person [except some class of persons]". What class of persons would the exception comprise? No answer can be made by the Court. Any qualification to Parliament's universal phrase would be a matter for Parliament itself, upon reconsideration of the definition.
8. The result is that s 5.6 has no field of operation. As the whole of Pt 5 applies only to motor accidents that are not the fault of any person, there cannot be in relation to an accident that engages this Part anyone against whom recovery could be made under s 5.6. It is a principle of statutory interpretation that all words and sections of an Act must have been intended by the legislature to have substantive effect. As the interpretation I place upon the definition of "no-fault motor accident" in s 5.1 results in s 5.6 being redundant, this principle dictates that a different meaning of s 5.1 should be searched for. As indicated above, the search has been in vain. In order to give s 5.6 some effect it would be necessary to discard the plain terms of s 5.1. But any qualification to that definition would do violence to it and in any event no qualification capable of reconciling the provisions can be formulated. The principle of adopting an interpretation that gives effect to all words and sections must give way.
9. As the words "not caused by the fault of any other person" in s 5.1 mean just what they say, it follows that the accident in the present case was not "no-fault" and therefore s 5.2(1) does not apply. If, contrary, to this view s 5.2(1) did apply, it would not have the effect that the plaintiff contends. Extracting the relevant words from the subsection and adding emphasis, it provides that: injury to a person that results from a no-fault motor accident involving a motor vehicle that has motor accident insurance cover for the accident … is, for the purposes of … any claim for … statutory benefits …, deemed to have been caused by the fault of the owner or driver of the motor vehicle in the use or operation of the vehicle.
10. This is a statutory deeming of fault in the causation of injury. In ss 3.11(1)(a) and 3.28(1)(a) the limitation to 26 weeks of statutory benefits turns upon fault in the causation of the motor accident. Fault in the causation of injury and fault in the causation of an accident are two different things - not in the empirical world, or in practical terms, but in the concepts of this statute. It is the express and apparently deliberate intention of ss 3.11(1)(a) and 3.28(1)(a) that the cut-off of statutory benefits at 26 weeks should turn upon the claimant's fault in causing the motor accident. The whole point of Pt 5 is to make provision with respect to motor accidents that are no one's fault. Section 5.2(1) artificially distinguishes between fault in the causation of injury and fault in the causation of the accident. It does so in order to deem fault in the causation of injury (and hence to create a path of liability) in the case of "no-fault motor accidents", where there is by statutory definition no fault in the causation of the accident and where the legislature has apparently deliberately chosen not to deem fault in the causation of the accident.
11. An aspect of the scheme of Pt 3 is that fault in causing the accident is the criterion for terminating statutory benefits at 26 weeks. That scheme would be subverted if a section located in Part 5 (dealing with accidents not caused by anyone's fault) should operate to deem fault in the causation of the accident for the purposes of the limit on statutory benefits. In my view s 5.2(1) does not so operate. Section 5.8 reinforces this conclusion. Part 5 has no bearing upon Mr Singh's entitlement to statutory benefits. It provides no basis for them being terminated after 26 weeks.

Amendment of the Act

1. Notwithstanding that a path through the labyrinth of Pts 3 and 5 of the Motor Accidents Injuries Act has been found for the purposes of resolving this proceeding, it is apparent that these provisions, Pt 5 in particular, require careful and detailed reconsideration. Amendment will be necessary if a spate of litigation generated by the obscurities of these provisions is to be avoided. At the very least, the conflict between ss 5.1 and 5.6 should be addressed by amendment. If the interpretation adopted in these reasons accords with Parliament's intention then s 5.6 should be repealed. If not, the definition of "no-fault motor accident" in s 5.1 will require adjustment in some respect, adopting a qualification to the concept of "any other person" that I cannot presently envisage.
2. A further amendment of Pt 5 that might be considered is the removal of s 5.3(2) and of the references to statutory benefits in ss 5.2(1) and 5.5 (and s 5.6, if it is not to be repealed). The words "statutory benefits" have already been deleted, by amendment, from s 5.4(1). They do not seem to have any place in ss 5.2(1), 5.5 or 5.6.The width of operation of s 3.1(2) is such that statutory benefits are payable by the insurer of a vehicle involved in a motor accident even if the accident was not caused by the fault of any person, including the owner or driver of a motor vehicle or the injured party. Section 3.2(1) provides the rule for determining which insurer must pay the statutory benefits. Thus Pt 3 is sufficient to provide for entitlement to statutory benefits and to identify the insurer responsible for them in the case of any motor accident that would fall within the definition of a "no-fault motor accident" in s 5.1. There is no need for the provisions of Pt 5 to deal with statutory benefits, at all.

Orders

1. It follows from the above conclusions that there was no error of law in the decision of the second defendant in her certificate dated 13 February 2019. Accordingly, the summons will be dismissed with costs.

Amendments 30 September 2019 - Delete the word "repealed" on cover sheet and at par [20] DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 September 2019