Allianz Australia Insurance Limited v Cervantes

Facts and reasons for decision 4On 24 June 2006, Dr Cervantes was a passenger during a test-drive of a motor vehicle when the driver lost control, smashed at speed and with considerable force into a curb, injuring Dr Cervantes by violently jolting her within the car and injuring her neck. 5Dr Cervantes was wearing a seatbelt at the time of the accident but was injured, amongst other things, by a whiplash type injury to her neck. She suffered significant bruising around her chest, throat and neck. 6Dr Cervantes was unable to work for three days and suffered neck problems and associated headaches. Initially she took the view that these problems would be short lived, but they became chronic. 7According to the claims assessor, Dr Cervantes suffered psychological issues due to post-traumatic stress disorder (PTSD) for which she received counselling and which made it difficult for Dr Cervantes to cope effectively with her work, her research and her studies. 8The neck pain and headaches made her irritable and frustrated, and the pain increased in intensity whenever she was required to work using a microscope or computer for prolonged periods. Her irritability caused tension with her colleagues and patients at the Hospital. Further, she found that she had neither the stamina nor the motivation to work long hours or to see a large number of patients. 9Nevertheless, Dr Cervantes continued to work, to write her thesis and to study. She completed her thesis and studies, qualifying as a Nephrologist in 2009. Notwithstanding her qualifications, her deteriorating work performance resulted in a decrease in her overall salary at the Hospital in early 2009. 10Once she qualified as a specialist Nephrologist, she was offered only 0.4 of a staff specialist salary. She expected a full-time employment position. She supplemented the part-time position by commencing locum work at another hospital and opened a private Nephrology clinic nearby. Her injuries prevented her from seeing more than three or four private patients per day. Commercial viability of the clinic required 18 patients as a minimum per day. Accordingly, Dr Cervantes closed the clinic in October 2010. 11The requirement to drive from one hospital to another aggravated her neck pain and headaches and she eventually resigned from the part-time staff specialist position and continued to augment her income with locum work. Dr Cervantes, at the date of assessment, was employed as a visiting medical officer at the small hospital to which reference has already been made and had recently entered into a five-year contract. 12The claims assessor found that such an arrangement was not the one under which Dr Cervantes would have operated if she were not to have been injured. Rather, according to the claims assessor, Dr Cervantes would have opened her own private Nephrology clinic (and implicitly, operated it profitably). 13Dr Cervantes continues to earn approximately $2,500 per week as a specialist, which, according to her evidence before the claims assessor, is significantly less than she would be earning had she not been injured and been able to conduct private practice. Her evidence was that successful Nephrologists can earn more than $500,000 per annum, from which amount would have to be deducted operating expenses, which can be high. 14Dr Cervantes continues to suffer pain in her neck and shoulders and occasional numbness in the left side of her face and arm. She medicates on panadeine, neurofen and occasional indocid. She has regular massages and meditates. She also has Chinese therapy approximately once per fortnight and cognitive behavioural therapy weekly. Her son regularly applies hot packs to her neck at the end of a day's work in an attempt to elevate the pain. Dr Cervantes doubted whether she would ever be fit enough to have her own renal practice, describing Nephrology as a very demanding and stressful practice. 15Dr Cervantes has rejected a number of offers for more locum work due to the pain that she is suffering, her irritability and reduced motivation. She is pessimistic about her working future and tenure as a part-time specialist at the larger hospital. 16The claims assessor summarised the medical evidence in a very general way. Medical evidence was adduced on behalf of Dr Cervantes from her general practitioner, Dr Woods and also from Dr John Davis, Dr James Bodel and Dr Robert Hampshire. Allianz adduced evidence from Dr Mastroianni and Dr Akkerman. 17The claims assessor described this evidence in the following way: "Dr John Davis (1st May 2009) diagnosed whiplash associated disorder with injury to the upper facets and CV joints in the claimant's cervical thoracic spines. He considered that her work capacity was reduced by her injuries and that she required at least 6 hours of domestic assistance weekly. Dr James Bodel, Orthopaedic Surgeon (20th August 2007 and 21st November 2008), accepted that the claimant had suffered a neck injury which restricts her neck and left shoulder movements. He considered that she would have difficulty concentrating and working at a computer and assessed her physical WPI at 5%. Dr Mastroianni, Occupational Physician (16th August 2007) for the insurer, assessed the claimant's WPI for her cervical injury at 5%. He diagnosed neck pain secondary to associated whiplash disorder but considered her neck symptoms would settle over 12 months. He recommended that she be treated by a Clinical Psychologist for her panic attacks. Dr Robert Hampshire, Psychiatrist (19th May 2008) diagnosed a major psychological problem with chronic pain, persistent symptoms of increased arousals and problems with sleep which in turn made the claimant irritable and caused her problems at work and impaired her concentration. He considered that the claimant's psychological sequelae have dashed her hopes of pursuing a successful career as a Clinical Nephrologist, despite the fact that she remains extremely intelligent. Dr Graham Vickery, Psychiatrist for MAS diagnosed post-traumatic stress disorder and a chronic pain disorder associated with psychological factors. Dr Akkerman, Psychiatrist, for the insurer, said the claimant was exaggerating and malingering." 18In relation to the foregoing evidence, essentially, the claims assessor accepted all or most of the opinions expressed by each of the doctors other than Dr Akkerman whom the claims assessor described as the only "medico to cast any doubt on the ... genuineness" of Dr Cervantes. The claims assessor's conclusions as to the medical evidence were in the following terms: "In relation to the claimant's psychological problems I accept the opinions of Drs Hampshire and Vickery and reject the opinion of Dr Akkerman who is the only medico to cast any doubt on the claimant's genuineness. I find that the claimant has ongoing psychological problems because of the accident which adversely affect her earning capacity. In relation to the claimant's physical injuries I accept the opinions and diagnoses of Dr John Davis who correctly predicted that the claimant's motivation would allow her to continue to work in her chosen field, albeit with reduced capacity. I accept the claimant required at least 6 hours of domestic assistance per week for the closed period being claimed. I accept the opinions and diagnoses of Dr James Bodel. I also accept the diagnosis of Dr Mastroianni although I disagree with his opinion that the claimant's neck symptoms would settle in 12 months. I find that her neck symptoms are ongoing and are likely to continue indefinitely." 19As to the facts necessary for the calculation of damage, the claims assessor was clearly impressed with Dr Cervantes. He described her as pre-accident, "clearly highly motivated, very intelligent and a high achiever". He concluded that she would have been able to open her own Nephrology practice by 2010 with the potential of earning a significantly higher income than she can earn as a 0.4 staff specialist and a VMO. 20The claims assessor also concluded that there was no loss of income associated with any delay in completing her specialist accreditation. The validity of this finding is not in issue in the proceedings. 21As to past economic loss, the claims assessor accepted that her reduction in salary in early 2009 was as a result of her physical and psychological symptoms caused by the accident. 22The claims assessor expressed the view that it was "difficult to calculate precisely the claimant's economic loss ... per week". As a consequence, the claims assessor awarded "past and future economic loss as a buffer". He described that calculation in the following way: "In relation to past economic loss, taking into account that her salary at John Hunter Hospital was reduced from January 2009 because of her injuries and further that she was not accepted by the hospital as a full-time Nephrologist and the fact that she has not been able to commence her private Nephrology practice, I award a buffer of $75,000.00, inclusive of loss of superannuation. ... Had the claimant not been injured she would have received a significant income both in private and public practice as a Nephrologist. She would have had the capacity to consult with a large number of patients daily, to continue valuable medical research, to maintain her high profile by presenting at seminars and conferences and the like. Her injuries will, to a great extent, prevent her from doing so. I award a buffer of $400,000.00, inclusive of loss of superannuation, for future economic loss. In doing so I have taken into account that she is a part-time specialist at the John Hunter Hospital when it was her reasonable expectation that she would have been a full-time specialist and that she has a significant retained residual earning capacity, demonstrated by the fact that she has recently entered into a 5 year contract as a VMO at Wyong Hospital. I also take into account that should the claimant find herself no longer working at John Hunter Hospital that she would be prejudiced by her injuries on the open employment market. I find that her injuries have prevented the claimant from commencing a private Nephrology practice and/or working as a staff Nephrologist at John Hunter Hospital." 23The claims assessor, accepting the opinions of Dr Davis and the statements of Dr Cervantes' son and former de facto, awarded compensable gratuitous care of six hours per week from the date of accident until February 2010 and awarded two hours per week on a commercial basis until retirement, at age 65. As to future care, the claims assessor said: "As I have found that the claimant continues to suffer from neck pain and restricted movement and headaches I accept that whilst the claimant is working she will be restricted in her ability to engage in heavy domestic and gardening duties. I consider the claimant's claim of 2 hours commercial care per week at $35.00 per hour ($70.00 per week) to age 65 is reasonable and modest." 24The claims assessor also awarded $20,000 as a buffer for future medical treatment, which is not in issue.

The assessment 25It is necessary to summarise the components of the damages award of the claims assessor. The award did not include any damages for non-economic loss, because Dr Cervantes did not pass the whole person injury threshold that is a jurisdictional precondition to an award for non-economic loss. The damages award of $570,133.36 was comprised of the following heads of damage: "Past out-of-pocket expenses: $4,789.36 Future out-of-pocket expenses: $20,000 Past economic loss: $75,000 Future economic loss: $400,000 Past care: $25,110 Future care: $45,234" 26There is no issue between the parties as to liability.

The grounds of review 27The grounds upon which Allianz seeks to invoke the supervisory jurisdiction of the Court are recited (except for the headings that I have inserted) directly from the Summons and are in the following terms:

The first ground: The effect of Dr Bodel's opinion that Dr Cervantes could continue in her chosen career "(a) He [the claims assessor] erred in his reasons for decision at page 6, seventh paragraph. There, the claims assessor referred to two reports of an orthopaedic surgeon, Dr James Bodel. Dr Bodel's reports were sought by the claimant below (the first defendant) but they were served and put into evidence by the plaintiff insurer in the proceedings before the claims assessor. In that paragraph and the next, the claims assessor summarised what Dr Bodel's evidence was. However, what was entirely omitted in that summary and what was not taken into account by the claims assessor was evidence that was most relevant to the plaintiff insurer's case, namely, the opinion that had been expressed by the expert that notwithstanding the injuries from the motor vehicle accident, the claimant should be able to continue in her chosen career (as a specialist doctor employed by a hospital and/or as a private specialist physician) until her normal retirement age. (b) In the premises, the claims assessor failed to take into account the finding of the medical specialist that the claimant could continue to work at the hospital until retirement. Accordingly, the claims assessor failed to take into account relevant considerations that he was bound to take into account and this failure constituted a jurisdictional error, or, alternatively, an error of law on the face of record. (bb) Alternatively, the claims assessor failed to have proper, realistic and genuine consideration to the said expert report; (cc) It was impermissible for the claims assessor to make a determination about an expert medical matter and the nature or extent of it in the absence of medical evidence; (dd) It was a manifestly irrational or illogical or unreasonable decision in this regard; (ee) The claims assessor failed to provide reasons or lawful reasons for these conclusions as he was required to do by section 94(5) of the Act and clause 18.4 of the Guidelines; and/or, (ff) The claims assessor was required to act fairly towards the parties and accord equity to them pursuant to clause 16.3 to 16.7 of the Guidelines. (c) Accordingly, the assessment decision is invalid and it should be set aside."

The second ground: The rejection of Dr Akkerman's opinion "(d) A second ground of judicial review is evident in the reasons for decision at page 7, fifth last paragraph. There, the claims assessor rejected the opinion of Dr Akkerman, a specialist qualified by the insurer, for the sole reason that he ' is the only medico to cast any doubt on the claimant's genuineness '. This demonstrates an error of law for a number of reasons. Firstly, the claims assessor failed to apply the correct approach to evaluating the evidence before him. It is not the correct legal test or lawful method of accepting or rejecting evidence to do so by sole reference to the criterion of whether it casts doubt on the claimant's genuineness. Secondly, it demonstrates that Dr Akkerman's evidence has been put to one side without its content having been considered or evaluated by the claims assessor. It was put aside by him because Dr Akkerman was on his own in one particular identified respect (namely, that he cast doubt on the claimant's genuineness). This is a failure to take into account relevant considerations that he was bound to take into account. (e) This error of law is sufficient alone for the Court to determine the assessment decision is invalid and it should be set aside."

The third ground: The use and amount of a "buffer" "(f) A third ground of judicial review is evident in the reasons for decision at page 8, last two paragraphs and page 9 first two paragraphs. In these paragraphs the claims assessor awarded past economic loss as a ' buffer ' in the amount of $75,000 and future economic loss as a buffer in the amount of $400,000. The claims assessor's statement of reasons contains almost no reasons as to how or why these conclusions were arrived at. There is no recognition of or evidence of compliance with section 126 of the MAC Act. The claims assessor's statutory duty here was to simply apply section 126 in accordance with its terms. His determination is erroneous in law because the buffers he determined were not true buffers and they were made without the claims assessor setting out any real explanation or providing any real reasoning and, more importantly, without him making any attempt to comply with the requirements of awarding damages for this head of damage pursuant to section 126 of the MAC Act. Pursuant to section 126 of the MAC Act, a claims assessor is bound to disclose certain assumptions about the claimant's most likely future circumstances but for the injury and is required to make adjustments to any amount of damages for future economic loss by reference to a ' percentage possibility ' that future events might occur. All these assumptions must be quantified and stated in the assessor's reasons for decision. None of these things occurred here. There was accordingly a failure to comply with important legislative requirements and the claims assessor was thereby acting without power or ultra vires. (g) Alternatively, the claims assessor failed to state reasons as he was required to do pursuant to section 94(5) of the Act and clause 18.4 of the Guidelines as to why he awarded these sums to the claimant under this head of damages and the assessment decision is invalid as a result."

The fourth ground: Future commercial care "(h) A final ground of judicial review is evident in the claims assessor's decision on future commercial care, at page 9 of the reasons for decision. In this section of his determination, he awarded $45,234 to the claimant for future commercial care. In reaching that view, he made a determination that the claimant had a future demonstrable need for 2 hours of commercial domestic assistance per week till retirement. The claims assessor failed to record reasons setting out why he determined that 2 hours of commercial care was required. It was a contested issue in the proceedings. In these circumstances, reasons were required to be set out and to explain this aspect of the determination pursuant to section 94(5) of the Act and clause 18.4 of the Guidelines. This is particularly so having regard to the principles in Miller v Galderisi [2009] NSWCA 353 (Allsop P, Basten and Macfarlan JJA) which record the proper basis upon which future commercial care damages ought to be awarded."

Scheme of the Act 28I take account of the purposes of the Motor Accidents Compensation Act 1999 (hereinafter "the Act") and its general structure. A number of judgments of this Court have dealt with the purposes of the Act. It is sufficient, for present purposes, to refer to the comments made in my judgment in NRMA Insurance Limited v Ainsworth [2011] NSWSC 344 at [22] and following and the judgments cited therein. Nevertheless, I repeat the comments of Young JA in Allianz Australia Insurance Ltd v Ward [2009] NSWCA 264, in which Young JA said, at [48]-[50]: "[48] The "MAC Act" clearly sets up a regime whereby there is to be a relatively informal assessment of damages by an administrative official. This displaces the former system of trial by judge or judge and jury with witnesses called and cross-examined. The new system is doubtless much cheaper. However, one would not expect that its accuracy would be as great as the result obtained through what is now regarded as a "Rolls Royce" procedure. [49] The legislature doubtless considered that errors could emerge out of the new procedure. However, it provided that there would be a review for obvious error by the Principal Claims Assessor, but only for obvious error and provided no appeal to the insurer. [50] The aim of the legislature was to see that claimants were assessed quickly and cheaply and paid their entitlements promptly." 29Otherwise, it is appropriate, for present purposes, to reiterate that the Act implemented a less formal scheme of non-curial assessment for damages arising from motor vehicle accidents in which there are duties on both a claimant for damages under the Act and the respondent and insurer for an open exchange of information and an expeditious, less formal resolution of the issues between the parties. The foregoing does not detract from the more complete analysis in the earlier judgments.

Principles on judicial review 30As earlier stated, Allianz moves the Court under s 69 of the Supreme Court Act which continues the Court's jurisdiction to supervise the conduct of administrative tribunals, in this case, by the issue of orders in the nature of certiorari. The provisions of s 69 of the Supreme Court Act allow orders in the nature of certiorari to issue to quash an administrative decision if that decision were to have been made on the basis of an error of law on the face of the record, which is defined to include the reasons expressed for the ultimate determination: see s 69(3) and s 69(4) of the Supreme Court Act and compare Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163. 31Notwithstanding the arguably broader basis for the issue of orders in the nature of certiorari, the limitations imposed by the nature of judicial review, as distinct from appeal, apply. 32Certiorari, or orders in the nature thereof, is not a form of appeal. It is an order that issues for error of law or error of jurisdiction. It does not allow review of the merits of the decision. In Attorney-General (NSW) v Quin [1990] HCA 21; (1990) 170 CLR 1 at 35-36, Brennan J reiterated that it is not the task of the court, on judicial review, to make orders for the purpose of avoiding administrative injustice or error. If the effect of correcting an error of law (or confining an administrative tribunal to the jurisdiction allowed to it) is that administrative injustice was to be corrected, that is an unintended collateral effect of the correction of legal error (and of confining the tribunal to its jurisdiction). I refer also to the comments of Hayne J in Edwards v Santos Ltd [2011] HCA 8 at [17]-[18], to like effect. 33In the present proceedings, most relevantly, it is important to observe that a claims assessor is required to give reasons for the assessment (see s 94(5) of the Act), but the requirement is that those reasons be in the form of a "brief statement". In providing a brief statement, the claims assessor must identify the heads of damage that are to be awarded and the manner in which the amounts in each head of damage has been determined: Insurance Australia Limited trading as NRMA Insurance v Helou [2008] NSWCA 240, per Campbell JA at [61], [62]. 34It is also important to reiterate that it is not an appropriate task for a court on judicial review to be "concerned with looseness in language" or examine the "reasons for the decision under review ... minutely and finely with an eye keenly attuned to the perception of error": Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272, citing, with approval, Collector of Customs v Pozzolanic Enterprises Pty Ltd [1993] FCA 322; (1993) 43 FCR 280. As the High Court said: "These propositions are well settled. They recognise the reality that the reasons of an administrative decision-maker are meant to inform and not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed." ( Wu Shan Liang , supra.)

Ground 1: The effect of Dr Bodel's opinion that Dr Cervantes could continue in her chosen career 35The first ground, summarised above, takes into account paragraphs (a), (b), (bb), (cc), (dd), (ee) and (ff) of the summons. As I have summarised above, the evidence before the claims assessor was that the injuries suffered by Dr Cervantes had prevented her from maintaining a private Nephrology practice and from continuing as a staff specialist on a full-time basis at the larger of the two hospitals at which Dr Cervantes worked. 36Dr Cervantes did open a private clinic for a short period but could not sustain that practice because of the symptoms of the injuries suffered from the motor vehicle accident. 37The evidence of the foregoing on which the claims assessor based his findings was significant. These are findings of fact. There is evidence upon which the findings can be based. 38Moreover, the opinion expressed by Dr Bodel that Dr Cervantes could continue in her chosen career is not inconsistent with the foregoing. There is no doubt, and it is certainly not a contention of Dr Cervantes in these proceedings or before the claims assessor, that Dr Cervantes worked as a Nephrologist. That work was performed on a 0.4 basis for the larger hospital and as a visiting medical officer at the smaller hospital. 39There is also no doubt that Dr Cervantes earned, by ordinary standards, a substantial income, even after the accident. However, neither of those facts is inconsistent with the finding of the claims assessor nor inconsistent with the evidence that the injuries suffered by Dr Cervantes prevented her from maintaining and reopening a private clinic and working full-time as a specialist at the larger hospital. 40As already stated, there was evidence of those facts. Each of those facts would result in a diminution in earning capacity of Dr Cervantes. Further, the findings are not irrational or illogical or unreasonable, manifestly or otherwise. The claims assessor paid proper and appropriate regard to the "expert report", which expressed the opinion that Dr Cervantes could continue in her chosen profession and career. The "expert report" did not evidence that Dr Cervantes could continue in private practice, as distinct from a career as a Nephrologist, until her normal retirement age. 41There was no unfairness associated with the foregoing findings. This ground of assessment is rejected.

Ground 2: The rejection of Dr Akkerman's opinion 42Allianz seeks to elevate a determination of fact to an error of law by submitting that to reject Dr Akkerman for the reason that "he is the only medico to cast any doubt on the claimant's genuineness" is to make an error of law. 43The claims assessor observed Dr Cervantes and came to a view that she was, as earlier stated, articulate, forthright and very intelligent. He also came to the view that Dr Cervantes was honest, answered the questions put to her candidly and directly and was an exceptionally talented and high-achieving individual whose injuries from the accident have deleteriously affected her income earning potential and her medical career (Reasons for Assessment, p 7). 44Each of the other medical experts considered Dr Cervantes to be genuinely suffering from the injuries about which she was complaining. Dr Akkerman took the view that Dr Cervantes was exaggerating and malingering. That view of Dr Akkerman infected the whole of his opinion. 45The claims assessor, having come to an opposite view, on the basis of the other medical evidence and by observing Dr Cervantes, was entitled, as a consequence, to reject the opinion of Dr Akkerman. The rejection of Dr Akkerman's opinion, in circumstances where there was evidence to support the view of the claims assessor and a reason for the rejection of Dr Akkerman, is a question of fact. If there were error in the rejection of Dr Akkerman, it was not error of law and was not jurisdictional. This ground of challenge is also rejected.

Ground 3: The adoption of a buffer for past and future economic loss 46Allianz relies upon the provisions of s 126 of the Act. Section 126 qualifies the assessment of future economic loss in a motor vehicle accident claim and is in the following terms: " 126 Future economic loss-claimant's prospects and adjustments (1) A court cannot make an award of damages for future economic loss unless the claimant first satisfies the court that the assumptions about future earning capacity or other events on which the award is to be based accord with the claimant's most likely future circumstances but for the injury. (2) When a court determines the amount of any such award of damages it is required to adjust the amount of damages for future economic loss that would have been sustained on those assumptions by reference to the percentage possibility that the events concerned might have occurred but for the injury. (3) If the court makes an award for future economic loss, it is required to state the assumptions on which the award was based and the relevant percentage by which damages were adjusted." 47In Nominal Defendant v Livaja [2011] NSWCA 121, Basten JA, Campbell JA and Rothman J gave a description of the assessment of future economic loss under s 126 of the Act. The Court said: "[39] The assessment of future economic loss involves an hypothetical calculation, with the need to balance a number of variables: see the recent discussion in Amoud v Al Batat [2009] NSWCA 333 at [22]-[28]. One purpose of s 126 is to require a structured approach to such a calculation. Subsection (1) is expressed in terms which emphasise the need for the plaintiff to satisfy the Court as to certain "assumptions" in respect of future earning capacity. The Court must only act upon such assumptions as are established to its satisfaction on the balance of probabilities. Those assumptions must accord with the plaintiff's "most likely future circumstances" on the basis that the injury for which he or she seeks compensation had not occurred. There is nothing obscure about the nature of the findings so required: they must be sufficient to establish a baseline of earning capacity, extending into the future, from which diminution caused by the injury may be calculated: see State of New South Wales (NSW Police) v Nominal Defendant [2009] NSWCA 225 at [83]-[84] (Beazley JA, Allsop P and Macfarlan JA agreeing). Further, the assumptions must be stated and there is authority for the proposition that failure to do so would render the judgment invalid: sub-s (3); Zahra v Brown [2006] NSWCA 162 at [71] (Beazley JA, Santow JA agreeing). [40] The purpose of sub-s (2) is less clear. There is a missing step between sub-ss (1) and (2). An essential part of the calculation is the assessment of the consequences for the claimant's earning capacity as a result of the injury. Subsection (2) requires adjustment of the amount of damages "by reference to the percentage possibility" that "the events concerned might have occurred but for the injury". Reference in sub-s (2) to "those assumptions" must be a reference to the assumptions about future earning capacity, absent the injury, referred to in sub-s (1). Subsection (1) refers to both assumptions and "other events": it might appear that the reference in sub-s (2) to "the events concerned" was intended to mirror the reference in sub-s (1) to "other events", although the language is somewhat obscure. ... [42] Each of these factors is liable to variation, depending upon the circumstances of the case. For example, the likelihood of improved earning capacity for a skilled or professional person, who was at the beginning of a career when the accident occurred, may be high. The possibility of unemployment for periods may be low in some occupations and higher in others. It is common under the general law to allow a reduction in the order of 15% (depending on the circumstances) for "vicissitudes", to allow for the possibility that some event other than the injury would have adversely affected earning capacity. Assuming that length and continuity of employment are treated as "events concerned", for the purposes of sub-s (2), that provision may be seen as allowing for variation for such vicissitudes." 48The provisions of s 126 of the Act are in identical terms to s 13 of the Civil Liability Act 2002 and the provisions, for different kinds of injuries, serve the same ultimate purpose. The terms of these provisions have been the subject of much authority. The authority, binding on the Court as presently constituted, makes clear that s 126 of the Act (or s 13 of the Civil Liability Act ) does not prevent a court awarding damages by way of a buffer in an appropriate case. 49With respect to the operation of s 13 of the Civil Liability Act , the Court of Appeal in Pollard v Baulderstone Hornibrook Engineering Pty Ltd [2008] NSWCA 99 at [84] said: "[84] As to the future economic loss, it is appropriate to award damages by way of a buffer, including in a case such as this where damages are to be determined pursuant to the Civil Liability Act, when the impact of the injury upon the economic benefit from exercising earning capacity after injury is difficult to determine. In such a case, the Court still undertakes a comparison between the economic benefits the plaintiff derived from exercising earning capacity before injury and the economic benefit derived from exercising earning capacity after injury, although the difference cannot be determined otherwise than by the broad approach of a buffer: Penrith City Council v Parks [2004] NSWCA 201 (at [3] - [5]) per Giles JA; applied K'mart Australia Ltd v McCann [2004] NSWCA 283 (at [62]) per Pearlman AJA (Handley and Ipp JJA agreeing); see also Hornsby Shire Council v King [2005] NSWCA 67 (at [23]) per Ipp JA (Mason P and Brownie AJA agreeing); Leichhardt Municipal Council v Montgomery [2005] NSWCA 432 (at [33]) per Hodgson JA (McColl JA agreeing). In the latter case Mason P (at [2]) opined that 'a buffer or cushion award is usually reserved to the situation where there is a smallish risk that otherwise secure employment prospects may come to an end, in consequence of the tort-related injury, at some distant time in the future', but, with respect, the accepted wisdom appears to be that a buffer can be deployed in circumstances such as the present." 50Section 126 of the Act was the subject of discussion by Hislop J in Allianz Australia Insurance Limited v Kerr [2011] NSWSC 347 at [19] and following. Hislop J said: "[22] The claims assessor found that by the time of the accident the first defendant had educated herself very well and had been working for years, apparently successfully, as a community nurse. She appeared to have succeeded in becoming qualified as an assistant in nursing working full-time. There was no evidence to suggest that she was having time off work prior to the accident. The assessor noted that she did want to move to a higher level of nursing assistant by taking a 12 month TAFE course but this was not completed prior to the accident. The assessor concluded 'In my view she has satisfied me that but for the accident she would have had continual work, albeit that from time to time she would have needed to change jobs and have time off work. Thus she has satisfied s 126 of the Act'. [23] The claims assessor found that the first defendant's neck injuries obviously compromised her ability to work and to deal with the other issues in her life particularly depression; she was currently employed in a job in which she no longer finds satisfaction or enjoyment and there seemed to be a real possibility that this job will soon be lost to her. [24] The first defendant's counsel submitted to the claims assessor that he should allow a weekly loss of $900.00 until the first defendant was 70 years of age and then make a discount of 30% for vicissitudes rather than the usual 15% because of pre-existing psychological factors. This would give rise to a claim of over $600,000.00. [25] The claims assessor concluded, in respect of the claim for future economic loss: '...I accept the insurer's submission that it should be by way of a buffer rather than a concise calculation, given the claimant's concession of pre-existing psychological issues, her pre-existing work history and her current capacity for work. An amount of $20,000.00 as submitted by the insurer is clearly inappropriate. I believe the sum of $200,000.00 is the appropriate sum. Again I have allowed a further $22,000.00 on the basis of future superannuation loss.' [26] In my opinion, the claims assessor has adequately complied with the requirements of s 126. As Giles JA observed in Parks : 'The occasion for a buffer is when the impact of the injury upon the economic benefit from exercising earning capacity after injury is difficult to determine.'" 51In Kerr , supra, Hislop J held that the claims assessor had adequately complied with the requirements of s 126 in finding that future economic loss should be calculated by way of a buffer, as opposed to a precise arithmetic calculation. The claims assessor considered the claimant's concession of pre-existing psychological issues, her pre-existing work history and her current capacity for work in awarding a buffer in the sum of $200,000. There was no error disclosed in the approach of the claims assessor, according to Hislop J. 52The matter was also the subject of discussion by this Court (Hoeben J) in Williams v Twynam Agricultural Group Pty Ltd & Anor [2011] NSWSC 1098. His Honour, at [213], referred to the judgment of the Court of Appeal in State of New South Wales v Moss [2000] NSWCA 133, (2000) 54 NSWLR 536 at [65] and [87]. In Moss , supra, Heydon JA, at [87], with whom Mason P and Handley JA agreed, said: "[87] In short, where earning capacity has unquestionably been reduced but its extent is difficult to assess, even though no precise evidence of relevant earning rates is tendered, it is not open to the court to abandon the task and the want of evidence does not necessarily result in non-recovery of damages. Statements to the contrary such as those made in Allen v Loadsman [1975] 2 NSWLR 787 at 792 are not correct: Baird v Roberts [1977] 2 NSWLR 389 at 397-8 per Mahoney JA; J K Keally v Jones [1979] 1 NSWLR 723 at 732-735 per Moffitt P; Yammine v Kalwy [1979] 2 NSWLR 151 at 154-5 and 156-7 per Reynolds JA and Mahoney JA; Thiess Properties Pty Ltd v Page (1980) 31 ALR 430; see also Radakovic v R G Cram & Sons Pty Ltd [1975] 2 NSWLR 751 at 761 where Samuels JA criticised the 'meagre facts' provided but did not say it was not open to the jury to find a substantial sum for diminished earning capacity by the 'application of their own knowledge and experience'. The task of the trier of fact is to form a discretionary judgment by reference to not wholly determinate criteria within fairly wide parameters. Though the trier of fact in arriving at the discretionary judgment must achieve satisfaction that a fair award is being made, since what is involved is not the finding of historical facts on a balance of probabilities, but the assessment of the value of a chance, it is appropriate to take into account a range of possible outcomes even though the likelihood of any particular outcome being achieved may be no more than a real possibility. The trial judge in substance explained these aspects of the jury's task satisfactorily." 53In Williams , supra, Hoeben J (after referring to the High Court in Husher v Husher (1999) HCA 47, (1999) 197 CLR 138 at [6]-[7]; which in turn referred to Graham v Baker [1961] HCA 48; (1961) 106 CLR 340; MacArthur Districts Motor Cycle Sportsmen Inc & v Ardizzone [2004] NSWCA 145; (2004) 41 MVR 235; Penrith City Council v Parks [2004] NSWCA 201; Nominal Defendant v Lane [2004] NSWCA 405 and Burton v Brooks [2011] NSWCA 175) summarised the principles in the following passage: "(1) The Court must assess the 'most likely' of the possible future economic circumstances facing the plaintiff but for the accident (including type of employment, duration of employment and remuneration); (2) Assess the plaintiff's economic prospects as a consequence of the accident; (3) Compensate the claimant for the difference between (1) and (2) including, where appropriate, through the use of a buffer; (4) Adjust (3) by an appropriate percentage for vicissitudes, to reflect the possibility that the plaintiff may not have achieved one even had the accident not occurred; (5) Include a statement of the assumptions made as the plaintiff's most likely future circumstances for the appropriate percentage adjustment." With great respect to Hoeben J, I adopt this summary, although, in the case of the use of a buffer, sometimes a nil adjustment will be used, or implied, for step 4 above: see Parks , supra. 54The relevant extracts of the reasons for assessment of future economic loss are summarised in the course of Allianz's grounds of review recited therein at paragraph 27(f) and otherwise the cost assessor's reasons are relevantly recited at [22]. The submissions made on behalf of Allianz do not suggest that a buffer is not an appropriate means of awarding damage for future (or past) economic loss. Rather, Allianz submits that the amount of the buffer is inordinately high and brings it to a point where a buffer is no longer appropriate and that the reasons disclose insufficient transparency to enable an understanding of the basis upon which the buffer has been awarded or calculated. 55As earlier stated and repeated the claims assessor was extremely impressed by Dr Cervantes. She was an extremely high achiever with extraordinary pre-accident accomplishments that were described by the claims officer as "outstanding". She was a person who was highly motivated, very intelligent and a high achiever. 56The claims assessor, as previously recited, was satisfied that, but for the injuries, Dr Cervantes would have opened her own Nephrology practice and would have earned significantly higher income than she can earn as a consequence of the injuries. 57Dr Cervantes, even without that higher income, is an extremely high-income earner by average standards. Yet, the claims assessor determined that Dr Cervantes would be unable to work the very long hours necessary to run a successful private practice as a Nephrologist and to maximise her income as a full-time hospital specialist. As a consequence, it was necessary for the claims assessor to compensate Dr Cervantes for the possibility, which the claims assessor considered was the most probable adverse effect, of the loss of future income that was difficult, if not impossible, to measure. 58As already stated, the reasons for determination of a claims assessor are required to be brief. Once each head of damage has been identified and the amount associated with it stated, all that is necessary is for the claims assessor to identify how the number attributed to each head of damage has been calculated. Calculations were provided for past care and future care (see page 10 of the assessor's reasons). The claims assessor accepted the claimant's evidence for past out of pocket medical expenses. All other figures were calculated in terms of a 'buffer' and therefore, did not require precise arithmetic calculation. 59The claims assessor has identified that the buffer awarded (for both past and future economic loss) was occasioned by the effect of the injury in denying Dr Cervantes the capacity to establish a profitable private practice and the significant potential earnings that have been lost as a consequence thereof. Necessarily a buffer is an estimate to account for uncertainties, usually of circumstance that will give rise to greater (or lesser) losses. In this case, it has been used to overcome the inability to assess, with precision, the loss in question, together with the possibility (however remote) that Dr Cervantes could, ultimately, engage in a lucrative private practice. 60Unlike some cases, there are no figures that disclose the earnings of comparable employees or practitioners to Dr Cervantes other than the general estimate of Dr Cervantes herself. That is not surprising considering that reliable information of that kind may be extremely difficult to obtain. Further, there is a need to understand the benefits arising from tax deductible expenses associated with the carrying on of a business, as distinct from employment, and the degree to which "business expenses" include expenditures that, were it an employment situation, would not be tax deductible. 61The evidence before the claims assessor (recited at p 5 of the reasons for determination) was that Dr Cervantes was earning $2,500 per week ($130,000 per annum), whereas a successful Nephrologist in private practice could earn more than $500,000 per annum (at least according to Dr Cervantes). Even assuming, conservatively, that the $500,000 estimate included income as a staff specialist (which I doubt), on the evidence available to the claims assessor, there was a loss of $370,000 per annum (less expenses). 62As earlier stated, the assessment of the claims assessor occurred on 11 January 2011. Dr Cervantes qualified as a Nephrologist in early 2009. Assuming, as I must, that the estimated earnings for a Nephrologist in private practice would not commence immediately upon qualification, the award of $75,000 as a buffer for the loss of private practice income for the two years between the date of qualification and the assessment is still an extremely conservative assessment or buffer for the uncertainties associated with the loss of that income. Further, each buffer includes superannuation losses. 63I reiterate that the claims assessor made clear that the income of that kind was a loss occasioned by the injury sustained. 64Given that at the time of assessment Dr Cervantes was 46 years of age and, on the findings of the claims assessor, Dr Cervantes would work to the age of 65, the buffer of $400,000 for future economic loss (including superannuation) associated with the inability to earn income in private practice is extremely conservative, and not significantly more than the difference in estimated income for one year. 65It is not suggested that there was evidence before the claims assessor that was inconsistent with the estimate of private income given by Dr Cervantes. While in ordinary circumstances a buffer of $400,000, inclusive of loss of superannuation, is more than is usually associated with an amount by way of "buffer", given the level of earnings and potential earnings of Dr Cervantes, the buffer is not excessive. 66The claims assessor has recited a number of findings including the nature of the injuries and the fact that the injury has caused Dr Cervantes to be unable to operate as a private practitioner. 67Further, the claims assessor has reiterated the difficulty of assessing with precision the degree to which practice as a private practitioner will continue to be unavailable. He indicates the only estimates available for earnings in a private practice (albeit which amounts include operating expenses) and provides a buffer for the inability to calculate precisely the past losses and future losses from that income source precisely. 68The claims assessor has not failed to identify the head of damage that has been awarded and how he has arrived at the number for each head of damage. Further, the claims assessor has not failed to make the findings of fact necessary to arrive at the conclusion that the buffer that has been awarded for each of past and future economic loss is a buffer that is well within the range available in the circumstances of this case. This ground of review is also rejected. 69Alternatively, one may ask what else could the claims assessor have done. He considered there had been past loss and there would be future economic loss occasioned by the inability to operate a private clinic. This was attributable to the accident. If he were to have refused to award damages for either head, there would have been error of law and probably jurisdictional error that, at least theoretically, could have been remedied by mandamus. On the other hand, the claims assessor could not (with any degree of precision), have calculated losses based on the $500,000 estimate. In those circumstances, a buffer of some significance was required and was awarded.

Ground 4: Future care 70Allianz seeks to impugn the award of future domestic assistance of two hours per week on a commercial basis until Dr Cervantes is aged 65. The age limitation is due to the finding by the claims officer that the commercial domestic assistance would be required only whilst Dr Cervantes was employed. 71The claims assessor determined that the inability to engage in heavy domestic and gardening duties is as a result of the continued suffering from neck pain and restricted movement and headaches which is caused by the claimant continuing to work, having suffered from the injury for which Allianz is liable. 72The claims assessor found that the claim of two hours' commercial care for the heavy domestic and gardening duties was a claim that was "reasonable and modest". The complaint, it seems, is that there is no evidence upon which the claims assessor could have based the finding that the past gratuitous care would not continue and, as a consequence, there would be no need for commercial care. 73The determination of a claims assessor, and the reasons for the determination, are not to be likened to a judgment of a court of law. There is, as previously stated, a deliberate legislative policy to compensate victims of motor vehicle accidents by a process which is predominantly determined in non-curial proceedings. As a consequence, there will always be a degree of informality in the proceeding. 74The past domestic care had been provided by a de facto from whom Dr Cervantes has since separated. The separation occurred shortly before the assessment of damage. 75Further, Dr Cervantes' adult son performed the domestic and gardening duties to some degree at least. It would defy common experience if the claims assessor were to assume that Dr Cervantes' son would continue to live at home to provide heavy domestic and gardening duties, or that the de facto would return to Dr Cervantes' residence in order to carry out those duties. 76There was sufficient material before the claims assessor for him to come to the view that the modest claim of two hours' commercial care per week would be required and not obtainable through continued gratuitous care. The primary facts that give rise to that implication are contained in the reasons for determination. This ground of review is rejected.

Conclusions 77For the foregoing reasons, each of the four general grounds of review has been rejected. Nothing in the foregoing should give rise to an implication that an amount of $400,000 (or an amount of $75,000 for past economic loss) would ordinarily be an appropriate figure for a buffer. These proceedings and the earnings of the claimant before the claims assessor were quite extraordinary. 78Nevertheless, sufficient primary facts have been found to allow one to understand the reasons for the buffer and why the amount of the buffer is, in the particular and peculiar circumstances of this case, an appropriate sum. 79As a consequence of the foregoing, the Court makes the following orders: (i) Judgment for the first defendant; (ii) Proceedings dismissed; (iii) The plaintiff pay the first defendant's costs of and incidental to the proceedings, as agreed or assessed; (iv) The plaintiff and the first defendant have seven days in which to notify the Court of any application for any different order for costs, whereupon, is there be disagreement, the matter will be listed for further directions. Leave is reserved, to the extent necessary, for any party to agitate any issue as to costs.

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: 02 November 2011