Annalysse Shantel Stanton v Jasmine Winning

The basis of the dismissal by the PIC

1. In the statement of reasons accompanying the notice of the PIC dismissing the medical dispute application, the decision maker stated they were of the opinion the Commission does not have jurisdiction to determine the dispute because the claimant resided in Queensland at the time the application was filed with the Commission. For that reason it was considered that the determination of the dispute may potentially involve the exercise of Federal jurisdiction.
2. The PIC had prior to that determination written to the parties by letter dated 13 January 2022, expressing its concern as to Federal jurisdiction, and inviting submissions, an invitation that for some unstated reason was not taken up.
3. The following matters stated in the letter from the PIC dated 13 January 2022 should be noted: 8.1. It expressly states that NRMA and the claimant are the parties to the medical dispute. 8.2. It states that "a judge has not decided if NRMA is legally considered to be the State of New South Wales". 8.3. The letter then refers to the decision of Gibb DCJ in Ritchie v Nominal Defendant NSWDC unrep dated 5.11.21. Implicitly the PIC letter treats the insurer in the present case in the same way as the Nominal Defendant was treated in Ritchie, namely as part of the State of NSW, and that being so, by reason of s75 of the Australian Constitution, the matter invoked federal jurisdiction, so that the PIC, not being a court for the purposes of s39 of the Judiciary Act, did not have power to deal with the matter.

Issues

1. The issue presented on the motion was put as whether or not the insurer, NRMA, was part of the state of NSW, as the PIC considered it may be. A concern in this hearing is that there is not a true contradictor to the application. There is no one arguing the position of the PIC. The Court was told that the issue is a significant one because if the PIC view is correct it would mean medical disputes would need to either be determined by a Court, or be subject to an application to a court for referral to the PIC. This, it was said, is counter to the objects of MACA, specifically the object to encourage early resolution of claims; s5(b). Relevantly s6 provides that in interpreting MACA a construction that promotes the objects of MACA is to be preferred to one that would not.
2. In my view, the parties are clearly correct as to the status of NRMA being that the company is not part of the state of NSW. There are however two other issues which have not been ventilated, and possibly three. The first issue is whether the NRMA is the party to the medical dispute, as opposed to the NRMA being the agent of the defendant. The second is whether the determination of the medical dispute is an exercise of judicial power. The third is whether, if the parties to the medical dispute are the plaintiff and the defendant, then, as they are not residents of different states, is s75 offended?

NRMA is not part of the state of NSW

1. The facts in Ritchie were that it was a claim for damages arising from a motor vehicle accident, that the plaintiff was not at fault, and that the at fault vehicle was not able to be identified, and that, in those circumstances, the correct defendant was the Nominal Defendant. The State Insurance Regulatory Authority (SIRA) under the provisions of the Motor Accidents Injuries Act, (MAIA) which was the relevant Act in Ritchie as the date of the accident was 2017, is the Nominal Defendant. The position is the same under MACA; see s32. Coincidentally in Ritchie, NRMA acted as agent for the Nominal Defendant. The argument in Ritchie centred on the status of SIRA, not its agent. In Ritchie any payment of the claim would be made from the Nominal Defendant's Fund established by the legislation; see s2.38 MAIA. In our present case any payment would be made by the insurer from premiums collected by the insurer, a conclusion reached in light of s 5 of MACA, particularly s5(2)(c) and (d).
2. Gibb DCJ held that SIRA was a part of the state of NSW. This conclusion was reached taking into account a number of factors, including that SIRA was established by statute, the State Insurance and Care Governance Act (SICGA), it performed an expressly regulatory role for compulsory insurance, with objectives as set out in s23 of the SICGA which her Honour described as "quintessentially executive / governmental in the nature, directed to the implementation of legislative schemes regulating employment, road usage and residential building"; at p8. Her Honour noted also that the board of SIRA is appointed by a minister of the NSW government, and that SIRA staff are employed in the Public Service.
3. The evidence in the present motion showed that NRMA is a registered public company, with its current name being Insurance Australia Limited, and that it is a company limited by shares. It was registered in 1926. It had a value of shares paid up or taken to be paid of almost $4 billion. Further, the claim in this case will be met from premiums, and not the fund (Nominal Defendant's Fund) established by statute.
4. The characteristics of SIRA which Gibb DCJ found resulted in the conclusion that it was part of the state of NSW are not present with NRMA. In my view NRMA is not a part of the state of NSW for that reason. It is a public company with shareholders carrying out the commercial activity of insurance. It is also a company taking part in the scheme established by MACA, but that is simply an example of private enterprise taking part in opportunities established by government, and a participant in the relevant scheme here does not thereby become the state.
5. Section 75 of the Constitution provides as follows:
6. Original jurisdiction of High Court. In all matters - (i.) Arising under any treaty: (ii.) Affecting consuls or other representatives of other countries: (iii.) In which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party: (iv.) Between States, or between residents of different States, or between a State and a resident of another State: (v.) In which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth: the High Court shall have original jurisdiction.
7. It was subsection (iv) which caused the concern of the decision maker of the PIC, on the basis that the medical dispute was between a State and a resident of another State. That is not the position, so that there is no invocation of Federal jurisdiction on that basis.

Other issues

1. The second issue identified above was the question of who are the parties to the dispute? The parties press for a finding that the parties are the plaintiff / claimant and the insurer. If that is the case, then no issue of Federal jurisdiction arises because it is well established that the words "residents" and "resident" appearing in s75(iv) refer only to natural persons and not corporations; see Crouch v Commissioner for Railways (Qld) (1985) 62 ALR 1.
2. A point not raised by either party was whether NRMA was acting as agent for the defendant, so that the parties to the medical dispute were the natural persons, the plaintiff and defendant. This might perhaps highlight the detriment of there being no true contradictor. I note in Ritchie that the Nominal Defendant was named as the defendant to the Summons before the Court, which by the legislation means the defendant was SIRA, as SIRA is the Nominal Defendant. The judgment then notes that the insurer (I presume the claim was allocated to the insurer pursuant to s2.36 of SICGA) was acting as agent for the Nominal Defendant (see page 2 of the judgment).
3. In Ritchie, the plaintiff lodged an application for determination of a dispute (it appears the same dispute as here). It seems almost certain the insurer was the answering party to that medical dispute application, even if not named, in the same way as in the present case, and even more likely given the terms of s2.36 of the MAIA. The Summons in Ritchie asked for the matter to be remitted to the PIC, as is sought here. The named defendant to that Summons was the Nominal Defendant, that is, the potentially liable party, and not the agent insurer. The defendant in Ritchie was the Nominal Defendant/SIRA. It was the status of SIRA that was the focus in Ritchie, not the agent insurer. That is, in Ritchie, it was the status of the defendant, not the agent insurer, that was being considered.
4. The position of the insurer is not exactly the same in the present case and in Ritchie. Here, the insurer collected premiums and was conducting insurance business, albeit in accordance with the relevant insurance scheme established by the legislation. In Ritchie, the insurer was appointed to manage the claim. By s2.36 this extends to "on behalf of and in the name of the Nominal Defendant, to deal with the claim (and any proceedings relating to the claim) in such manner as it thinks fit" and "may settle or compromise any such claim"; subsections (3) and (4).
5. The effect of s2.36 is to remove the need for the potentially liable party, SIRA, to be involved; the agent insurer does not need instructions from the potentially liable party to conduct or compromise the claim, but is to do so as it thinks fit. It may well be that the terms of the CTP policy between the defendant and the NRMA are to the same effect, however those terms are not in evidence. Assuming they are the same, what is notable is that even with that absence of a need for instructions from the defendant, what Ritchie determined was the status of the defendant, there SIRA. Should it be that the relevant CTP policy does not contain such provisions, then all the more reason to consider the position of the defendant, not the agent insurer. Significantly, s78 MACA empowers the insurer in much the same way as s2.36 MAIA.
6. Any reliance on Ritchie as to who was a party to the medical dispute should be guarded because the matter was not in issue, and it may be that the parts of the judgment referred to above do not, for that reason, properly reflect the situation.

Who are the parties to the medical dispute?

1. The question remains, who are the parties to the medical dispute?
2. The plaintiff / claimant is the injured party, a natural person who resides in Queensland.
3. The defendant to the statement of claim is the plaintiff's mother, a natural person who resides in Queensland.
4. The insurer, NRMA, is the CTP insurer who has issued a policy that answers to the plaintiff's claim.
5. The initial claim form dated 31 July 2014 states on its first page that the claim form "must" be sent to the CTP insurer. The form instructs the claimant to find out who the CTP insurer is, and advises how to do that. On the facts of the present case it does not require the driver alleged to be at fault to be served with the claim. Nor does s72 MACA require the defendant to be served with the claim form, though that section makes it clear the claim is made against the defendant, and not the insurer.
6. The statement of claim names the plaintiff and the defendant as the parties, as would be expected. This does not assist in determining the current issue.
7. Similarly, that the current motion names the parties as the plaintiff and the defendant does not assist.
8. The medical dispute application form names no defendant but is designed to engage the insurer. In section 2, it allows for two possible applicants, the claimant or the insurer, with no provision for it to be the defendant. In this case it was the claimant who made the medical dispute application, and the insurer responded to it.
9. The question put to the parties in submissions was whether the insurer was acting as agent in accordance with the obligation to provide indemnity under the policy, and in accordance with the terms of that policy, or, in effect, in its own right. The principle of subrogation was raised. However acting as an agent insurer pursuant to a policy of insurance, without more, is a matter of agency, not subrogation.
10. The argument of NRMA is that the medical dispute application conducted in PIC is a distinct and different proceeding to the District Court proceedings. NRMA argues that this outcome is supported by the nature and characteristics of the current New South Wales compulsory third-party insurance scheme relating to motor vehicles.
11. NRMA outlined how the medical dispute arose, and relevantly that it was brought pursuant to s 60 of MACA. The medical dispute application is in evidence and is made on a form headed "MAS Form 2A" on the letterhead of the SIRA. In evidence as exhibit C was a sample of a reply form to an application for assessment of permanent impairment. The actual reply if any of the insurer to the claimant's application was not in evidence. Exhibit C, like the application, refers to sections 58 and 60 MACA. It is headed "MAS Form 2R" and is on the letterhead of SIRA. Also like the application, it allows for the parties to be either the insurer or the claimant, with no provision suggesting the defendant has a role to play in the dispute process. Exhibits A and B are documents dated 9 February 2021 and 22 December 2020 respectively which are the insurer's submissions in answer to the application. It was put that this further demonstrated the dispute was with the insurer, not the defendant.
12. The argument for NRMA relied on the scheme established by MACA. MACA sets out provisions for the making of claims including provisions for steps that must be taken prior to the matter being determined by a court and providing also for a mechanism whereby the matters may be determined without going to court, by being heard formerly by CARS, and now by the PIC; see s90 MACA.
13. In that regard the argument being submitted on the part of NRMA is supported by section 5 setting out the objects of MACA. The section makes it clear that MACA creates an insurance scheme by which monies are compulsorily collected from citizens and from those funds damages are paid. As already noted, the object is for claims to be resolved early.
14. Chapter 2 of MACA deals with third-party insurance. Section 16 specifically states that the licensed insurer is liable to indemnify the insured persons under a third party policy of the insurer in respect of any liability the policy purports to cover. This, like s72, shows that the defendant to the claim is the alleged at fault driver, not the insurer. Chapter 3 deals with motor accident injuries. Parts 3.2 and 3.3 make provision relating to the early payment of certain monies by the insurer to an injured person. Part 3.4 is headed medical assessment. Section 57 defines "medical dispute" as a disagreement or issue to which this part applies, that is part 3.4.
15. Section 58 specifically provides that part 3.4 applies "to a disagreement between a claimant and an insurer" about whether the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%.
16. Section 60 provides that a medical dispute may be referred to the President "for assessment under this part by either party to the dispute or by a court or the commission"; the reference here to "either party" is a reference to the claimant or the insurer.
17. Section 61 provides that a medical assessor to whom a medical dispute is referred is to give a certificate as to those matters. That certificate is evidence of the matters certified in any court proceedings or in any assessment by the commission.
18. Section 62 provides for referral for further medical assessment by a court or the president or by any party to the medical dispute. Given the terms of section 58 the reference to party is a reference to the claimant and the insurer.
19. Chapter 4 is headed "Motor Accident Claims". Section 72 referred to above is contained in chapter 4. Plainly enough, as the claim must be made for the insured to have any awareness of the matter the provisions provide for making claims before any medical assessment. That is the medical assessment occurs as a consequence of the claim having been made against the driver at fault, and with the involvement of the insurer arising by reason of the policy answering to that claim.
20. Chapter 4 contains section 78 within Part 4.2. It provides as follows: 78 POWER OF INSURER TO ACT FOR INSURED (cf s 47 MAA) (1) When a claim is made against a person, the person's insurer may-- (a) conduct and control negotiations in respect of the claim, and (b) conduct, or take over the conduct of, any legal proceedings in respect of the claim and may conduct those proceedings in the name and on behalf of the person, and (c) at any stage of those negotiations or proceedings, compromise or settle the claim, and (d) exercise any function conferred by this Act on the person in respect of the claim. (2) The person against whom the claim is made is required to sign all such warrants, authorities and other documents as may be necessary to give effect to this section. (3) If the person fails to do so or is absent or cannot be found, the insurer may sign the warrants, authorities or other documents on behalf of the person. (4) Nothing said or done by an insurer under this section in connection with the settlement of a claim or the conduct of proceedings in respect of a claim is to be regarded as an admission of liability in respect of or in any way prejudice any other claim, action or proceeding arising out of the same occurrence.
21. This provision has the effect of placing the insurer in the shoes or the defendant, and permitting the insurer to exercise rights of the defendant.
22. Part 4.4 of MACA is headed "Claims Assessment and Resolution". By s88, party to an assessment means the claimant or the insurer. Whilst this Part is dealing with claims assessment and not a medical dispute, the provision is consistent with sections 58 and 60 and providing that the parties to the assessment are the claimant and the insurer, not the at fault driver. The objects of the Act to achieve early resolution of claims is facilitated by an efficient claims process, and by an efficient medical dispute process. Taking the words of the legislation at face value, if insurer means insurer, and it is the insurer who is the party to those processes, the aim of efficiency and speed is more likely to be achieved. It also has the further benefit that it would reduce if not eliminate any prospect of complications arising from any issue Federal jurisdiction, further facilitating the objects of MACA.
23. The question resolves down to whether Part 3.4 and in particular section 58 and section 60 can be read as creating rights for an insurer that accrue to that insurer as an insurer as opposed to making provision for the insurer as the agent of the party being indemnified. For the reasons just stated sections 58 and 60 can be so read, a conclusion supported by section 78.
24. The order sought by the motion is sought pursuant to section 26(5) of the PIC Act. That section provides: 26 APPLICATIONS INVOLVING FEDERAL JURISDICTION MAY BE MADE TO DISTRICT COURT (1) A person with standing to apply to the President or the Commission for a matter concerning a compensation claim to be determined by the usual decision-maker (a "compensation matter application" ) may, with the leave of the District Court, make the application to the Court instead of the President or Commission. (2) The regulations may make provision for or with respect to-- (a) who has standing to make an application for leave, and (b) excluding or including applications as compensation matter applications. (3) The District Court may grant leave for a compensation matter application to be made to the Court only if it is satisfied that-- (a) an application was first made to the President or Commission, and (b) the determination of the matter by the usual decision-maker would involve an exercise of federal jurisdiction, and (c) the usual decision-maker would otherwise have had jurisdiction enabling the decision-maker to determine the application. (4) An application for leave must be-- (a) filed with the District Court along with-- (i) an application that has been completed in the form and manner required under this Act or enabling legislation for the kind of compensation matter application concerned, and (ii) if the parties to the compensation matter application have reached a settlement before leave is sought using a resolution process provided under this Act or enabling legislation--a copy of the terms of settlement, and (b) accompanied by the applicable fee (if any) payable for the compensation matter application unless it has already been paid. (5) The District Court may-- (a) remit a compensation matter application for determination by the usual decision-maker if the Court is satisfied that the usual decision-maker has jurisdiction to determine it, and (b) do so instead of granting leave or after granting leave. (6) If the District Court remits a compensation matter application to be dealt with by the usual decision-maker, the Court may make such orders that it considers appropriate to facilitate the determination of the application by the decision-maker. (7) The usual decision-maker is to determine any compensation matter application that is remitted to the decision-maker in accordance with any orders made by the District Court.
25. Significantly section 26(1) allows a person "with standing to apply to the President or the Commission for a matter concerning a compensation claim" (emphasis added) to make an application under section 26. A compensation claim is defined by section 25 to be a claim for damages under MACA, that is, a claim under s72 of MACA, and not a medical dispute, which is not a claim made by an insurer. The medical dispute application is a matter "concerning" a compensation claim, and as determined above, that is a dispute for which the insurer has standing.

Summary and conclusions

1. NRMA is not part of the State of NSW for the purposes of s75 of the Constitution, for the reasons set out above.
2. NRMA is a party to the medical dispute. Its status is beyond that of an agent due to the provisions of the Act. The terms of s78 give significant power to the insurer, akin to, if not actually subrogating the rights of the defendant to the insurer.
3. That NRMA is a party to the medical dispute is a conclusion supported by the following matters: 50.1. The objects of the Act set out in section 5 include to achieve early resolution of claims, and consistent with that, seeks to have claims dealt with efficiently and expeditiously. The claims process is designed to lessen the need for matters to be determined by a court. A properly open interpretation that sees the medical dispute involve the insurer, which will be a company, and not a defendant who is a natural person, will promote that aim as opposed to defeating it by at least reducing if not eliminating any issues of Federal jurisdiction which may otherwise slow the resolution of the matter. 50.2. MACA is referred to by s5 as a scheme. It heavily involves the insurer, in this case NRMA. 50.3. A medical dispute is expressed by s58 to be between a claimant and an insurer. The medication dispute application forms MAS 2A and MAS 2R provide for the insurer as a party to a medical dispute, not the defendant. Whilst these forms are not legislative provisions and should not be given too much weight, they should not be ignored altogether. I do not place any weight on the fact that submissions on the medical dispute were made by the insurer. 50.4. Section 72 MACA provides that a claim, as distinct from a medical dispute application, is made against "a person whose insurer is a third party insurer". There is no doubt that the actual claim being made by an injured person is against the allegedly at fault driver. But in that claim process the provisions of the Act concerning a medical dispute refer to the insurer as a party. Whilst those provisions could be interpreted as making references consistent with the insurer being the agent of the insured, the scheme of the Act, its objects, and provisions such as s78, result in the conclusion that it is the insurer who is the party to the medical dispute. The terms of section 58 and 60 are more easily read to mean what they say on their face in light of those provisions just mentioned. Whether this result is arrived at by viewing the medical dispute as an entirely separate proceeding as argued by NRMA or is simply a part of the overall claims resolution process does not matter, though the more likely position is of the medical dispute simply being part of the process of the large damages claim. Had the legislation intended for the medical dispute to involve the claimant, it could easily have said so.
4. That the claim for damages is made against the allegedly at fault driver does not mean that all disputes that may emerge in the course of the claims process under MACA are between the plaintiff and defendant. The scheme gives significant power to the insurer by s78, and seeks to establish, with the PIC, an efficient medical dispute and claims assessment process, so far as possible without engaging in a court process. It is logical that it be the insurer to be the party to that process in this scheme to facilitate its objectives. That the objects of MACA place obligations on the insurer, including that they account for their profit margins, is also consistent with attributing to the insurer the role of a party to the medical dispute process.
5. Bearing in mind the nature of the scheme and its objects, and in particular the provisions of ss58, 60 and 78, the conclusion reached is that it is intended by MACA that the medical dispute be contested by the insurer, albeit with the result impacting on the liability of the defendant, primarily, and then by way of indemnity, the insurer.
6. This conclusion means that it is not necessary to consider the question of Federal jurisdiction where the position is of a non chapter III court (tribunal) of one state determining a dispute between two residents of the same state as each other but different to the state of the tribunal.
7. Nor is it necessary to deal with the question of whether judicial power is being exercised by the PIC. In this regard the remarks of Leeming JA at [30] and [31] of Burns v Corbett [2017] NSWCA 3 are interesting, but need not be considered further.

Orders

1. In light of the finding that the medical dispute initiated by the plaintiff / claimant's application does not involve an exercise of federal jurisdiction, leave will not be granted for the compensation matter application (that is, the medical dispute application) to be made to this Court. No formal order was sought in that regard, but the refusal of leave should be noted in the orders. Based on the same finding, the matter will be remitted to the PIC.
2. The following orders are made (and the reference to the medical dispute application is relevant a reference to the compensation matter application referred to in section 26), and the costs order is made by consent:
3. Leave to pursuant to section 26(3) for the medical dispute application to be made to this Court is refused.
4. Pursuant to section 26(5) the medical dispute application is remitted to the PIC for determination.
5. By consent, the costs of this motion are costs in the cause. 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: 11 April 2022