[2014] HCA 12
Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503
[2012] HCA 55
SZTAL v Minister for Immigration and Border Protection
SZTGM v Minister for Immigration and Border Protection [2017] HCA 34
Category: Principal judgment
Parties: Tajinder Atwal (Plaintiff)
Source
Original judgment source is linked above.
Catchwords
7.20(3)[2014] HCA 12
Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503[2012] HCA 55
SZTAL v Minister for Immigration and Border ProtectionSZTGM v Minister for Immigration and Border Protection [2017] HCA 34
Category: Principal judgment
Parties: Tajinder Atwal (Plaintiff)
Judgment (14 paragraphs)
[1]
JUDGMENT
In June 2020 Mr Atwal was injured in a motor vehicle accident for which he later made a claim under the Motor Accident Injuries Act 2017 (NSW) for the physical and psychological injuries which he suffered. The insurer accepted liability for the accident and Mr Atwal pursued damages for non-economic loss resulting from the impairment caused by his psychological injury. But his physical injuries, some of which required surgery, have not yet stabilised and so have not been assessed.
Despite Mr Atwal having been assessed by two psychiatrists, Dr Lim and Dr Cocks, to have suffered more than 10% whole person impairment as the result of his psychological injury, of respectively 50% and 24%, the insurer did not concede that Mr Atwal had suffered more than 10% impairment. That being the statutory threshold for the claimed damages: s 4.11.
The insurer did not make this concession despite the Act imposing a duty on the parties to endeavour to resolve a claim justly and as expeditiously as possible and it having exercised its right to have Mr Atwal assessed, with the result that Dr Cocks' report supported his claim: ss 6.4 and 6.27. Section 6.27 requiring a claimant to comply with an insurer's request to undergo such a medical examination.
In these proceedings Mr Atwal complains that in not conceding that he had exceeded the statutory threshold, insisting on a medical assessment and opposing the Commission assessing his damages on the basis that his psychological injury had satisfied the threshold, the insurer failed to act in accordance with obligations imposed upon it by the legislative scheme and the applicable Motor Accident Guidelines. That having resulted in the President of the Commission referring to a Senior Member of the Commission the parties' dispute about the operation of the statutory scheme.
This reflected that the insurer had acted to frustrate the statutory process, which includes the object specified in s 1.3(2)(g) of the Act "to encourage the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes", it having no medical evidence to support its position.
That was all disputed by the insurer. As was the proper construction of the Act and the applicable Guidelines. This judgment is concerned with Mr Atwal's application for judicial review of the Senior Members' decision, which the insurer supports.
This all arises to be considered in light of the intention of the Guidelines being to support the administration of the statutory scheme and the operation of the Act by establishing clear processes and procedures and compliance requirements. It being a condition of an insurer's license that it not only comply with s 6.20, which regulates an insurer's admissions or denial of liability and s 6.22 which requires it to make a reasonable offer of settlement after liability has been admitted, but also that it comply with parts of the Guidelines that apply to it: cl 10.7.
The Guidelines specify when an insurer "should" concede that impairment exceeds 10%, as well as when the insurer "must" refer a dispute to the President of the Commission for assessment. Guidelines 4.129 and 4.130 providing:
"4.129 The insurer must make decisions relating to non-economic loss based on all the available information and documents, consistent with the facts and in accordance with the law. For example, the insurer should concede an entitlement to non-economic loss when it is in possession of health service provider examination reports that indicate that a claimant's WPI is greater than 10%.
4.130 The insurer must in every case, regardless of whether the claimant makes a damages claim for non-economic loss:
(a) clearly indicate that it has determined whether or not the claimant is entitled to non-economic loss
(b) when a claimant claims to be entitled to non-economic loss but the insurer disagrees, clearly explain the reasons and detail any medical information considered in the course of making its decision that the injured person's degree of permanent impairment is not greater than 10%
(c) ensure that the explanation is sufficient to enable the claimant to make an informed decision about whether to accept the insurer's decision
(d) where a claimant has sufficiently recovered to enable the claim to be quantified, and the insurer is unable to determine whether the claimant's degree of permanent impairment is greater than 10%, refer the matter to the President of the Personal Injury Commission for assessment."
The insurer served Dr Cocks' report, which indicated that his whole person impairment was greater than 10%, on Mr Atwal in January 2024, referring to cl 4.129 of the Guidelines. The insurer's solicitor then explaining that it did not accept Dr Cocks' conclusions about the degree of Mr Atwal's impairment, because he had not taken into account two matters it considered to be relevant, with the result that it considered his assessment not to be reliable. But it made no reference to cl 4.130 of the Guidelines.
There is no issue that neither the Act nor the Guidelines impose an obligation on an insurer to accept the opinion of the medical practitioner it engages to examine a claimant. The matters Mr Atwal was advised the insurer considered Dr Cocks had not taken into account were:
"1. The Claimant completed an Advanced Diploma in Hospitality after the subject accident. The course was undertaken from June 2021 to May 2022 and was completed satisfactorily, albeit with some credit transfers.
2. The Claimant had a shoulder surgery in June 2022 and is still undergoing rehabilitation. His shoulder injury has affected his capacity for household chores. The Claimant's general practitioner adjusted his capacity for work from 12 hours per week to no capacity on account of the surgery."
This advice accorded with the obligation imposed by s 6.3(3)(c) on insurers to provide "written reasons for all decisions that materially affect a claimant's entitlement to statutory benefits or damages". It also had the duty to provide Mr Atwal "with all relevant information (including reports by health professionals) relied on to make a decision on a claim": at s 6.3(3).
But the insurer had seemingly not obtained any medical opinion which supports the view that Mr Atwal has not met the impairment threshold. It also emerged at the hearing that the insurer's reasons for not accepting the medical opinion it had received were not fully disclosed.
The advice given to Mr Atwal did not refer to him not having sufficiently recovered to permit the impairment caused by his psychological injury to be determined, that being what cl 4.130(d) of the Guidelines is concerned with. That was certainly not the view which either Dr Lim or Dr Cocks had come to. Nor was that referred to in the case advanced before the Senior Member, where guideline 4.130 does not appear to have been raised for consideration.
Despite its concern that Dr Cocks had not considered the matters it had advised Mr Atwal about, it also seems that the insurer did not ask him to consider them and provide it with a supplementary report, as the parties accept it could have.
There is no issue that in those circumstances, Mr Atwal still had the right to pursue his claim. But he did not seek an assessment of a medical dispute. He taking the view that in the absence of any medical reports suggesting that he had not satisfied the impairment threshold, there was no genuine dispute about that between the parties, with the result that the Commission could assess his damages, without him first being assessed by a medical assessor.
Accordingly, Mr Atwal asked the insurer to refer his claim for assessment of damages to the Commission, which it refused to do. Its position then being that there was an unresolved dispute about whether he exceeded the 10% impairment threshold, which had to be referred for medical assessment under Div 7.5 of the Act.
That was not accepted by Mr Atwal, but the insurer still did not refer its dispute with him for medical assessment, as it could have. Nor did it advise Mr Atwal that it did not consider that he had not sufficiently recovered, to enable it to determine whether his impairment was greater than 10%.
Mr Atwal then himself asked the Commission to assess his damages, which the insurer opposed.
Mr Atwal then considered that in the circumstances the President had a discretion under s 7.20 to determine on the evidence that there was in fact no medical dispute about him having satisfied the 10% impairment threshold, with the result that no legitimate referral for his medical assessment could be made and the Commission could assess his damages.
The insurer disagreed, its position remaining that damages could not be assessed by the Commission without Mr Atwal's impairment first being assessed by a medical assessor, despite what the psychiatrists who had examined him had agreed about his whole person impairment.
The result was that a preliminary issue was referred to the Senior Member to be determined. That issue was identified, in the undated reasons later given by the Senior Member for the conclusion he had arrived at on 12 August 2024 at a preliminary conference, to be whether "damages may be awarded to the claimant for non-economic loss": at [3] of the reasons.
What the Senior Member had concluded at the preliminary conference was that for the purpose of s 4.12(1) of the Act, there was "a dispute about whether the degree of permanent impairment of the claimant is sufficient for an award of damages for non-economic loss". That being the case, s 4.12(1) was clear: "damages may not be awarded to the claimant for non-economic loss unless the degree of permanent impairment has been assessed by a Medical Assessor under Division 7.5": at [4] of the Senior Member's reasons.
The result was, the Senior Member concluded, that "as matters presently stand if the matter proceeded to assessment, I could not make an allowance for non-economic loss": at [5] of the Senior Member's reasons.
In these proceedings Mr Atwal pursues orders setting aside or declaring the Senior Members' decision invalid and remitting the matter to the President, for allocation to a different claims assessor to determine his application for assessment of his damages, according to law.
Mr Atwal's complaint including that the course the insurer had pursued had frustrated what the statutory scheme intended. Namely, the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes: s 1.3(2)(g).
There is no issue that if Mr Atwal is correct, the orders sought could be made. But the insurer resists the construction of the Act and Guidelines which he pursues.
[2]
Conclusions
For reasons which follow I have concluded that the orders sought by Mr Atwal cannot be made, given the proper construction of the Act and the Guidelines.
But I have concluded that what has arisen to be considered has shed light on an apparent deficiency in the Guidelines, which may in an important respect not accord entirely with the statutory scheme.
As a result, I will ask the Registrar to refer this judgment to the State Insurance Regulatory Authority which is given the power to issue those Guidelines: s 10.2 of the Act. This is so that consideration may be given to the provisions of cls 4.129 and 4.130 of the Guidelines, their operation and whether cl 4.130 accords with obligations imposed by the Act or could be improved, intended as the Guidelines are to assist the achievement of the statutory scheme.
The Act's objects including as they do, the encouragement of the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes: s 1.3(2)(g).
[3]
Grounds
The grounds pursued in Mr Atwal's summons were:
1. Error in finding s 4.12 did not require evidence from an approved practitioner of permanent impairment for a dispute;
2. Error in asking the wrong question;
3. Error - Ultra vires exercise of jurisdiction; and
4. Error in findings against the weight of the evidence.
[4]
Issues
In issue between the parties was:
1. The proper construction of the statutory scheme and the Guidelines;
2. Whether there could be a dispute between the parties about Mr Atwal's impairment exceeding the statutory threshold, in the absence of any rebuttal medical evidence obtained by the insurer; and
3. Whether the Senior Member erred in concluding that there was a medical dispute between the parties which had to be referred for assessment by a medical assessor, before Mr Atwal's damages for non-economic loss could be assessed by the Commission.
[5]
The Senior Members' reasons
Before turning to these issues, the Senior Member's short reasons should be further explained.
After referring to the background, the Senior Member explained the cases which the parties had advanced, neither of which turned on the Guidelines.
Mr Atwal's case being that:
He was entitled to have both his economic and non-economic losses assessed, even though there had been no medical assessment of his psychological injury under the Act. Such an assessment not being mandatory or a precondition to eligibility for non-economic loss, s 4.12 only being a limitation on the circumstances in which a party to a medical dispute can seek to claim non-economic loss: at [12];
There was no dispute that Dr Lim and Dr Cocks' assessments of his permanent impairment had established that he satisfied the statutory eligibility for non-economic loss damages, Mr Atwal relying on Insurance Australia Ltd t/as NRMA Insurance v Scott [2016] NSWCA 138 at [118]; and
It was thus nonsensical to construe s 4.12 as requiring him, in the absence of any factual dispute about his impairment, to request the President to determine whether there was a medical dispute, in the absence of plausible evidence to support the existence of a dispute: at [14].
This was rejected, the Senior Member concluding that there was a factual dispute between the parties about Mr Atwal's impairment: at [15].
The insurer's submissions were explained to:
Address ss 4.12, 7.17 and 7.20 of the Act and Scott at [119]. The insurer considering Dr Cocks' report to be flawed explained why it did not accept his assessment. It also considered both psychiatrist's reports to be outdated, given treating reports which expected assessment of his psychological injury after expected improvements in Mr Atwal's physical injury, following treatment. That putting in issue the degree of his impairment: at [19];
Include that the dispute envisaged in s 4.12 was a medical dispute as defined in s 7.17, to include a dispute between the parties about a medical assessment matter. Such a dispute could be referred for assessment under Div 7.5: at [20];
Include that the existence of such a dispute did not necessarily require evidence from an approved health practitioner of impairment above or below the threshold: at [21]; and
Be that the issue as to Mr Atwal's impairment will have to be determined by a medical assessment, based on subsequent treating reports: at [22].
After quoting s 4.12 the Senior Member accepted the insurer's submissions that a dispute about whether the degree of permanent impairment of an injured person is sufficient for an award of damages for non-economic loss did not necessarily require evidence from an approved health practitioner, of permanent impairment below the threshold. Further, that a party could dispute medical evidence on the basis that it is flawed in some identified way, so that it cannot be relied on to establish the level of impairment contended for. A dispute arising in such circumstances being a factual dispute about impairment: at [25].
The insurer had given reasons for not accepting the opinions of Dr Lim and Dr Cocks in the January 2024 letter. Dr Cocks' assessment did not bind it or prevent it from declining to accept that Mr Atwal's impairment was greater than 10%: at [28]. For the purpose of s 4.12 this meant there was a dispute about the degree of his permanent impairment, which was a "medical dispute", that being a dispute between a claimant and an insurer, not one between doctors: at [30]-[31].
Whether the degree of Mr Atwal's impairment was greater than 10% was a medical assessment matter, a dispute about which was a medical dispute, given Sch 2 cl 2(a) of the Act and s 7.17: at [32].
Section 4.12 was clear and unambiguous, not permitting an award for damages for non-economic loss if there is a dispute about whether the threshold has been met, unless the degree of permanent impairment has been assessed by a medical assessor under Div 7.5: at [36].
Section 4.12 does not require a referral under s 7.20 and a determination by the President that there is a bona fide dispute which can be referred for medical assessment: at [37]. Section 4.12 places a restriction on an award of damages for non-economic loss when there is a dispute about permanent impairment and s 7.20 provides a procedure for its determination: at [38].
The President has power to refuse a referral for assessment if the party has provided insufficient evidence in support of the claimed permanent impairment. A finding that there is a bona fide dispute is not a condition precedent to s 4.12 being engaged: at [39].
Neither party having made an application for assessment of their medical dispute, no determination had been made about this assessment, so that their dispute remained undetermined: at [40].
What was decided in Scott in relation to the predecessor statutory scheme had to be considered in light of s 7.20 including a discretion to refuse to accept a dispute for referral. Whether that had any impact on the need for there to be a "genuine dispute" remained to be seen: at [42].
[6]
The proper construction of the statutory scheme
It is the construction of s 4.12(1) which Mr Atwal raised by the grounds which he advanced. The submissions which the parties advanced also raised the construction of s 7.20 and provisions of the Guidelines. They did not address how the Act must be construed, but the principles are well settled and oft referred to.
In short, the task of construction begins, as it ends, with the statutory text, with the statutory text from beginning to end being construed in context, with an understanding of context having utility "if, and in so far as, it assists in fixing the meaning of the statutory text" : Thiess v Collector of Customs (2014) 250 CLR 664; [2014] HCA 12 at [22], quoting Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 at [39] referred to in SZTAL v Minister for Immigration and Border Protection; SZTGM v Minister for Immigration and Border Protection [2017] HCA 34 at [37]. Further, integral to making a choice between a range of potential meanings, is discernment of the statutory purpose: SZTAL at [39].
Section 4.12 provides:
4.12 Assessment of permanent impairment required if dispute over impairment threshold
(1) If there is a dispute about whether the degree of permanent impairment of an injured person is sufficient for an award of damages for non-economic loss, damages may not be awarded unless the degree of permanent impairment has been assessed by a medical assessor under Division 7.5.
(2) This section does not prevent -
(a) the degree of impairment from being re-assessed under Division 7.5, or
(b) a claim from being settled at any time.
Section 7.20 provides:
7.20 Medical assessment procedures
(1) A medical dispute about a claim may be referred to the President for assessment under this Division by -
(a) either party to the dispute, or
(b) a court or the Commission, or
(c) a merit reviewer.
(2) The President is to arrange for the dispute to be dealt with by one or more medical assessors.
(2A) The President may arrange for a medical assessor to assess the dispute outside the State -
(a) if requested by a party to the dispute, or
(b) with the consent of the parties to the dispute.
(2B) In deciding whether to make an arrangement under subsection (2A), the President must consider the following -
(a) the interests and wishes of the parties to the dispute,
(b) the nature and complexity of the dispute,
(c) if the arrangement is necessary for the timely and cost effective assessment of the dispute,
(d) other matters the President considers relevant.
(3) The President can refuse to accept the referral by a party to a claim of a dispute about the degree of permanent impairment if the party has provided insufficient evidence in support of the degree of permanent impairment asserted by the party.
(4) The claimant and the insurer must provide to the medical assessor such information as the assessor may reasonably require for the purposes of the medical assessment.
(5) It is a condition of an insurer's licence under this Act that the insurer must comply with subsection (4).
(6) The medical assessor may decline to make a medical assessment if the claimant or the insurer has failed to provide any such information required by the assessor.
Reference was also made to s 1.7 of the Act. It is an interpretation provision which deals with the determination of whether the degree of permanent impairment of an injured person as a result of an injury caused by a motor accident is greater than 10%. This is known as "the impairment threshold".
This section provides that if the injured person receives both a physical injury and a psychological or psychiatric injury arising out of the same motor accident, the degree of permanent impairment that results from the physical injury has to be assessed separately from that which results from the psychological or psychiatric injury, which may not be added together for the purposes of the impairment threshold. If either the degree of impairment caused by the physical injuries or by the psychological or psychiatric injuries is greater than 10%, the person is taken to have an impairment greater than the threshold.
In written submissions it was argued for Mr Atwal that s 1.7 was a deeming provision giving rise to "a statutory presumption in favour of an injured person that the state of affairs in respect of Plaintiff's degree of percentage impairment will be presumed to satisfy the impairment threshold unless and until the contrary is provided": at [41].
This submission was properly withdrawn at the hearing.
In Mr Atwal's case the degree of impairment, if any, which his physical injuries have caused have not yet been assessed by a medical assessor. Nor has the insurer accepted that he has satisfied the impairment threshold as the result of his psychological injury, despite the views which both Dr Lim and Dr Cocks have arrived at.
Even though no medical practitioner appears to have expressed the view that he has not satisfied the threshold, that does not mean that there is no medical dispute between these parties. Neither the Act nor the Guidelines require an insurer to concede that the threshold has been satisfied in such circumstances. Clause 4.130 of the Guidelines providing when an insurer "should" make the concession. As Mr Atwal accepted, it does not provide that the insurer must accept reports that indicate that whole person impairment is greater than 10%.
Section 4.12 requires a medical assessment, in the event of a dispute about whether the degree of permanent impairment of an injured person is sufficient for an award of damages for non-economic loss. The case advanced for Mr Atwal was that there was no genuine dispute between the parties, because none of the medical evidence supported him not having met the impairment threshold.
But neither s 4.12 nor the Guidelines require that such a dispute be "genuine". Rather, an insurer is bound by the duty imposed on it by s 6.3 to act in good faith towards a claimant, including in relation to what it disputes. There is no issue that in this case, despite its obligations and the existing reports, the insurer has made no concession about the threshold. That does not establish that it has failed to act in good faith.
The evidence establishes that there is a dispute between the parties about whether, in circumstances where the reports of both Dr Lim and Dr Cocks support Mr Atwal's claim that he had satisfied the impairment threshold, the statutory scheme permits the Commission to assess the non-economic loss resulting from his psychological injury, without a medical assessor having issued a certificate about the impairment resulting from his psychological injury. That was what was referred to the Senior Member to consider.
Mr Atwal contending in these proceedings that he erred in the conclusions arrived at. Further, that s 7.20 gives the President a discretion to refer a claim for damages for non-economic loss for assessment by the Commission, without such a medical assessment of a claimed impairment.
I am satisfied that the express words of both s 4.12(1) and s 7.20 preclude the construction for which Mr Atwal contends. Reading the statutory text in context, permits no other conclusion.
In coming to this conclusion what was decided in Scott has to be taken into account. The Court there having concluded that the former statutory scheme under which a medical dispute could also be referred for assessment, was not predicated on the existence of a "genuine dispute". Further, that the existence of a medical dispute was not a jurisdictional fact to be determined by the Court, but rather a matter to be determined by the proper officer: at [115]-[119].
I cannot see that the current statutory provisions have taken any fundamentally different approach.
I am thus satisfied that a fair reading of the words used in ss 4.12 and 7.20, in their statutory context, must result in Mr Atwal's construction of both sections being rejected. That construction also not being supported by the provisions which the Guidelines make, although they cannot override any provision of the Act and must be construed consistently with what it provides.
[7]
The Act
It is Part 4 of the Act which regulates the award of damages for 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: s 4.1. Damages cannot be awarded to a person in respect of a motor accident contrary to that Part: s 4.2. Damages for non-economic loss is regulated by Div 4.3. No such damages can be awarded unless the degree of permanent impairment suffered is greater than 10%: s 4.11.
In the event of a dispute about whether a claimant's permanent impairment is sufficient for an award of damages, they may not be awarded without an assessment by a medical assessor under Division 7.5: s 4.12(1).
The provisions made in Part 7 Dispute Resolution, where s 7.20 appears, do not permit any other conclusion. It making no provision for an insurer's refusal to make a concession about impairment not resulting in a "genuine" dispute, or in such a case, giving the President power to refer the claim to the Commission for assessment of damages, without a medical assessment.
Both the issue of liability for damages and the amount of such damages are assigned to the Commission for assessment: s 7.36. Neither it nor the President are involved in the determination of whether the liability threshold for such damages has been met.
Section 4.12 requiring that permanent impairment, when there is a dispute about the degree of the injured person's impairment, be assessed by a medical assessor.
The word "dispute" is not defined in s 1.4 or Part 4 of the Act. Dispute resolution is dealt with in Part 7, but "dispute" is also not there defined. What is provided for in that part includes in Div 7.5 Medical Assessment, a definition in s 7.17 of "medical dispute" to mean:
"(a) a dispute between a claimant and an insurer about a medical assessment matter, or
(b) an issue arising about a medical assessment matter in proceedings before a court for damages or in connection with the assessment of a claim by the Commission."
"Medical assessment" is there defined to mean an assessment of a "medical assessment matter" under Div 7.5 Medical Assessment. That division regulates how medical disputes are to be referred for assessment by the President and how assessments are to be conducted by medical assessors in accordance with the Guidelines. With the result that any impairment is to be expressed as a percentage: s 7.21(1). The assessor's resulting certificate will thus establish whether the impairment threshold has been met: s7.23.
Clause 2 of Schedule 2 to the Act also declares certain matters to be medical assessment matters for the purposes of Part 7. They including "(a) the degree of permanent impairment of the injured person that has resulted from the injury caused by the motor accident".
There may also be a medical dispute "about a decision of an insurer", which a claimant may not refer for assessment until it has been the subject of an internal review by an insurer: s 7.19(1). But that does not apply to "a medical dispute about the degree of permanent impairment of the injured person that has resulted from injury caused by the motor accident": s 7.19(2A).
A medical assessor is required to give a certificate about the matters referred by the President for assessment under s 7.20, which becomes prima facie evidence of any matter certified as to the degree of impairment of earning capacity of the injured person and conclusive evidence of any other matter certified, in any assessment of claims for damages by the Commission under Div 7.6: s 7.23. That assessment must be conducted in accordance with the Guidelines: s 7.21.
It follows that a dispute between a claimant and an insurer about its refusal to concede that the statutory impairment threshold has been met, is a medical dispute which may be referred to the President for referral for medical assessment. As is a dispute about whether the claimant's impairment satisfies the impairment threshold.
It is the parties or a merit reviewer who may refer a medical dispute about a claim to the President for assessment: s 7.20(1). In which case the President is to arrange for the dispute to be dealt with by one or more medical assessors: s 7.20(2). Merit reviews are dealt with in Division 7.4 and need not be further considered here.
The President can only refuse to accept a referral by a party to a dispute about a claimant's degree of permanent impairment, if the party has provided "insufficient evidence in support of the degree of permanent impairment asserted": s 7.20(3). There is no issue about sufficient evidence to support Mr Atwal's claim being available.
Still, no-one has yet referred the parties' dispute about whether Mr Atwal's psychological injury satisfies the impairment threshold to the President, despite all the evidence that it does, the insurer's ongoing refusal to concede that he has met that threshold and what cl 4.130 of the Guideline contemplates.
The assessment of a claimant's degree of permanent impairment must be made in accordance with the Guidelines, which also require that it be expressed as a percentage: s 7.21(1). Those Guidelines do not bind psychiatrists such as Dr Lim or Dr Cocks, but still they have both undertaken that exercise.
It is the medical assessor who must give a certificate as to the matters referred for assessment, setting out the reasons for any finding as to any matter certified: s 7.23. And it is the medical assessor who may decline to make an assessment of an injured person's degree of permanent impairment "until satisfied that the impairment caused by the injury has become permanent": s 7.21(4).
It is Division 7.6 which regulates claims assessment by the Commission. It requiring the parties to use their best endeavours to settle claims, but allowing either the claimant or insurer to refer a claim for damages to the Commission for assessment: s 7.32.
Mr Atwal has made such a referral, which the Senior Member has concluded cannot be assessed by the Commission, without a medical assessment of whether his impairment has satisfied the impairment threshold, as s 4.12 requires.
Section 7.34 makes certain claims exempt from assessment in circumstances, but they are not here relevant.
Section 7.36(1) requires the Commission, on a referral of a claim for assessment, to make an assessment of:
"(a) the issue of liability for the claim (unless the insurer has admitted liability), and
(b) the amount of damages for that liability (being the amount of damages that a court would be likely to award);"
The Act having to be read as a whole, I am satisfied that this obligation must be understood in the context of s 4.12. It precluding damages for non-economic loss being awarded by the Commission, unless the degree of permanent impairment has been assessed by a medical assessor under Div 7.5. This helps explain why the case advanced for Mr Atwal cannot be accepted.
Subdivision 3 of Div 7.6 also deals with miscellaneous claims assessments a "dispute" is there defined to mean "a dispute between a claimant and an insurer about a miscellaneous claims assessment matter": s 7.40. Such matters are those declared in Schedule 2: s 7.1(1). They are also not relevant to what here arises to be considered: Sch 2 cl 3.
It is also relevant that s 7.42 empowers any party to refer a dispute about a miscellaneous claims assessment matter to the Commission for assessment at any time. But there is no comparable provision in Div 4.3 for referral of a dispute about claims for damages for non-economic loss. Section 4.12 instead precluding such damages being awarded, when there is a dispute about whether the impairment threshold has been satisfied, unless the degree of permanent impairment has been assessed by a medical assessor.
It is in that context that s 7.20 must be construed. It deals with medical assessment procedures and specifies who can seek to have a medical dispute referred; the President's power of referral of the dispute to a medical assessor; and the power to refuse a referral by a party to a claim, if that party has provided insufficient evidence in support of the degree of permanent impairment asserted. There is no such discretion given if the referral is made by a merits review. Nor when a party contends that there is no genuine dispute about the degree of the injured person's permanent impairment, about which the section is silent.
That is why the construction of the Act for which Mr Atwal contends cannot be accepted.
Mr Atwal's submissions included that the construction of s 4.12 of the Act which the insurer advanced and the Senior Member accepted was unreasonable and frustrated the statutory scheme. In the absence of rebuttal medical evidence, an insurer not conceding that an injured person had the right to have their damages assessed would result in consequences that are capricious, irrational and unjust.
I am satisfied that this may not be accepted.
Properly construed, the statutory scheme presently does not permit the Commission to consider Mr Atwal's claim for damages for non-economic loss, notwithstanding that he considers that the insurer's refusal to concede that he has met the impairment threshold is unreasonable.
The Act does require the parties' dispute about whether he has met the impairment threshold to become the subject of a binding medical assessment certificate, before damages for non-economic loss are assessed by the Commission. The President has not been given power to refer a claim for damages for non-economic loss for assessment by the Commission, even if the insurer refuses to concede that the claimant has met the impairment threshold, and the President considers that there is no genuine dispute between the parties.
That is simply not a concept which the Act embraces.
The scheme envisages that an insurer may concede that the impairment threshold has been met. If the concession is not made, the result is a medical dispute which must be assessed by a medical assessor who issues a binding certificate as to the claimant's whole person impairment. That certificate must be issued before the President can refer the claim to the Commission for assessment of damages for non-economic loss suffered as the result of the impairment.
[8]
The Guidelines
The case Mr Atwal pressed in this Court included that the insurer was in breach of the obligations imposed on it by the Guidelines.
In Ali v AAI Limited [2016] NSWCA 110 the predecessor legislative scheme, the Motor Accidents Compensation Act 1999 (NSW) and the Guidelines made under it and whether they were delegated legislation, also arose for consideration: at [75]-[99].
It was there concluded that the Guidelines were not delegated legislation "in the sense that they bind of their own force". Instead, if judicial review is sought of a decision of an assessor based upon the Guidelines, it will be necessary to address the provisions of the statute which make the Guidelines applicable, as well as the particular clauses relied on, "because both the Act and Guidelines made pursuant to it proceed on the basis that they are not all of the same legal force.": at [99].
Here the parties did not grapple with such matters. But they both referred to the requirements of the Guidelines and the insurer's compliance with them, to advance their cases. In Mr Atwal's case, in order to contend that the insurer's course involved an attempt to frustrate the statutory scheme. That was also disputed.
Section 6.1 of the Act now provides that "The Motor Accident Guidelines may make provision with respect to the manner in which insurers and those acting on their behalf are to deal with claims.": s 6.1.
It is the State Insurance Regulatory Authority constituted under the State Insurance and Care Governance Act 2015, which may issue such Guidelines "with respect to any matter that is authorised or required by or under this Act to be provided for by Motor Accident Guidelines": s 10.2(1).
Special provision is also made in the Act in respect of medical matters dealt with in the Guidelines, including as to "the assessment of the degree of permanent impairment of injured persons", about which the Authority has to "consult relevant medical colleges, health professional associations and other bodies": s 10.4(3).
This accords with the Authority's principal objectives specified in s 23 of the State Insurance and Care Governance Act to include, providing for the effective supervision of claims handling and disputes under motor accidents legislation and promoting compliance with such legislation.
The Guidelines which applied at the time the insurer advised Mr Atwal that it did not concede that his impairment exceeded the statutory threshold appear to have been parts of Version 9, published in November 2022 as well as parts of Version 9.2, which commenced on November 2023. Clauses 4.129 and 4.130 making the same provisions in both versions.
They required the insurer to take steps to ascertain whether or not the impairment resulting from a claimant's injury exceeded the statutory threshold. There is no issue that the insurer complied with this obligation when it obtained Dr Cocks' report: cl 4.129. That it did not obtain a supplementary report about the reservations it advised Mr Atwal it had about this report, does not appear to have accorded with that obligation.
Still Mr Atwal properly accepted that cl 4.129 of the Guidelines contemplates that other evidence could establish that a claimant has not met the impairment threshold. That there was such evidence is not conceded, but that is not for the Court to resolve.
It is cl 4.130 of the Guidelines which imposed an obligation on the insurer to refer a dispute for assessment in the circumstances there specified. Namely, when the claimant is sufficiently recovered to enable the claim to be quantified. That Mr Atwal had not done so, was not referred to in the letter explaining why satisfaction of the impairment threshold was not conceded by the insurer. Nor was an explanation given as to why it had not referred what it clearly then considered to be a medical dispute to the President for assessment, as it could have.
The proper inference, it was submitted for Mr Atwal, was that there was in reality no bona fide dispute about him having met the threshold, given the available medical evidence. Further, that the insurer was in breach of the obligation which cl 4.130 of the Guidelines imposed, having refused to concede that the threshold had been satisfied. This Guideline requiring the insurer to refer his claim for assessment of his non-economic loss if there was a medical dispute, as ss 7.20 and 7.23 of the Act also contemplated. It was also contended that this failure was a matter which the Senior Member ought to have had regard to, given what s 4.12 of the Act provided.
That was disputed by the insurer. It contending that cl 4.130 of the Guidelines contemplated that if it considered that Mr Atwal had not yet sufficiently recovered for his impairment to be assessed, it need not refer the dispute for assessment. And that it had not been obliged to do more than it did.
Its view appears to rest on a report of the treating psychiatrist Dr Singh who had said in September 2022 that Mr Atwal's shoulder surgery "would help with alleviating many of his symptoms" and that while he had had the surgery in 2022, he is still undergoing rehabilitation.
The merits of the insurer's case do not arise to be considered in these proceedings. But it does appear this was not raised in the submissions advanced before the Senior Member. Still, he was satisfied on the cases which the parties did advance, that "the insurer does not accept the claimant has a permanent impairment that is greater than 10%": at [30].
On the material which the Senior Member had to consider, that conclusion was plainly open. It still remains the insurer's position.
In these proceedings the insurer also submitted that even if it had referred the parties' dispute to the President, the result would have been the same as that which the Senior Member arrived at. Mr Atwal's claim for damages for non-economic loss could still not have been referred to the Commission for assessment, without the degree of his permanent impairment having first been medically assessed, it not having conceded that he had met the statutory impairment threshold. That still therefore needing to be established by a medical assessor's certificate, before damages could be assessed by the Commission: s 4.12(1).
That, it seems to me, must also be accepted. Nothing that the Guidelines provide can detract from the proper construction of the statutory provisions, earlier discussed.
[9]
The Senior Member did not err
It follows from all that I have discussed that the Senior Member did not err in his resolution of the matters over which the parties did join issue before the Commission.
The insurer had refused to concede that Mr Atwal's impairment had exceeded the statutory threshold, despite what cl 4.129 and 4.130 of the Guidelines and the psychiatrists' reports provided. It disclosed some of its reasons to Mr Atwal. But no mention was made of its view that he had not sufficiently recovered to enable his claim to be quantified, so that cl 4.130 of the Guidelines was not engaged, with the result that it did not refer the medical dispute it considered existed, to the President for assessment.
Notwithstanding Mr Atwal's disagreement with the reasons the insurer gave for not conceding impairment and its refusal to refer the parties' dispute to the Commission, there is an ongoing medical dispute between them which a medical assessor has to deal with. This was properly recognised by the Senior Member.
In written submissions Mr Atwal had argued that the existence of such a dispute depended on logical, probative and relevant evidence, not mere assertions advanced by an insurer.
The documentary evidence established not only the insurer's disputed decision and why Mr Atwal disagreed with it, given evidence which the psychiatrists who had examined him had concluded. It also included opinions expressed by the treating psychiatrist, to which the Senior Member's attention does not appear to have been drawn.
But as well as the statutory provisions which precluded the Commission's assessment of damages for non-economic loss, without the parties' medical dispute being assessed by a medical assessor, the Guidelines also expressly contemplated that circumstances could arise where an insurer did not accept the opinions of a psychiatrist it had engaged to assess a claimant's injuries. This was such a case.
As a result, it must be accepted that the Senior Member did not err in the conclusion which he arrived at. Until the parties' dispute about whether Mr Atwal has met the impairment threshold is assessed by a medical assessor, the Commission cannot determine his damages for the non-economic loss he may have suffered.
[10]
The parties' dispute may be referred to a medical assessor
It follows that the insurer's construction of the Act and the Guidelines must be accepted.
On the evidence and cases advanced the parties do have an ongoing medical dispute. Neither party has yet referred that dispute for assessment. There being ample evidence about the degree of Mr Atwal's impairment, the discretion in s 7.20(3) to refuse a referral does not appear to be available to be exercised by the President.
The Act does not empower the President to decline to make such a referral when an insurer considers that an impairment caused by an injury has not become permanent. That is a matter for a medical assessor to determine: s 7.21(4). Understandably, given the medical questions involved, which Mr Atwal's situation highlights.
Regrettably, it seems to me, despite the objects of this statutory scheme, what was in issue and in evidence before the Senior Member and what was concluded, the parties' medical dispute has still not been referred for assessment. Despite a dispute between a claimant and an insurer about a medical assessment matter, as defined, also being a medical dispute, that including a dispute "about a decision of an insurer": ss 7.17 and 7.19. Here it is the insurer's refusal to concede that Mr Atwal has satisfied the impairment threshold, despite the available evidence, about which he complains.
Here the insurer's case is that whether Mr Atwal has met the impairment threshold still cannot yet be assessed, despite the ample medical evidence to the contrary before the Senior Member. That is a matter for a medical assessor to determine.
It follows that the current situation does not appear to accord with the statutory scheme. It seems to me that the problem which has arisen is perhaps explained by cl 4.130 of the Guidelines.
[11]
Referral to the State Insurance Regulatory Authority
That by the course the insurer pursued it intended to frustrate the statutory scheme is a serious allegation which, if established, could have adverse consequences for it under the Act: s 9. That is not for the Court to decide in these proceedings.
What has been revealed about the practical operation of the Guidelines does raise a concern which I consider should be drawn to the Authority's attention, given the important objects of this statutory scheme. They including as they do encouraging the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes.
That is what Guidelines 4.129 and 4.130 are directed to.
The insurer's decision not to concede that Mr Atwal had met the impairment threshold attracted s 7.19(2A). Referral of that medical dispute to the President for assessment thus did not have to await the insurer's internal review of its decision: s 7.19(2A).
Guideline 4.129 deals with when a concession about non-economic loss should be made. Namely, when the insurer is in possession of reports that indicate a impairment greater than 10%. This was such a case.
The concession still not having been made, Guideline 4.130 required the insurer to clearly explain its reasons to Mr Atwal, providing him with sufficient information to enable him to make an informed decision about whether to accept its decision.
What the insurer did not disclose to Mr Atwal was that it had concluded that he had not sufficiently recovered to enable his claim to be quantified, despite what Dr Lim and Dr Cocks had concluded. Nor that it would thus not refer his claim for medical assessment, as Guideline 4.130 otherwise contemplated. That only emerged in these proceedings.
What Guideline 4.130 provides does not sit comfortably with Guideline 4.129. Nor with relevant provisions of the Act. It only being an assessor who can "decline to make an assessment of the degree of permanent impairment of an injured person until the assessor is satisfied that the impairment caused by the injury has become permanent.": s7.21(4).
The Act plainly contemplates that an insurer can contend before an assessor that an impairment has not become permanent. Not that the insurer can resist the referral of a medical dispute for assessment on the basis that it considers that the claimant has not sufficiently recovered to enable the claim to be quantified. That is certainly not provided by s 7.20, which does not empower the President to refuse a referral in such a case.
It follows that Guideline 4.130 does not appear to reflect the statutory scheme, or the language which it uses and that it does not sit comfortably with Guideline 4.129.
This case, it follows, has disclosed a deficiency in the Guidelines which the Authority might wish to consider. I will thus ask the Registrar to refer this judgment to the Authority.
[12]
Costs
The usual costs order under the Civil Procedure Act 2005 (NSW) is that costs follow the event.
In this case that is an order that Mr Atwal bear the insurer's costs. Unless the parties approach to be heard with short written submissions within 14 days, that will be the Court's order.
[13]
Orders
Had this Court the power, I would order that the parties' medical dispute be immediately referred for medical assessment. But the parties are agreed that the court referred to in s 7.20 does not include this Court on an application such as this. I accept that common position.
In those circumstances it is for the parties and the Commission to now consider the course which the matter has taken, so that there is no further unnecessary delay in the resolution of the parties' dispute about Mr Atwal's impairment.
For the reasons given I order that:
1. The summons be dismissed.
2. Unless the parties approach to be heard with short written submissions within 14 days, Mr Atwal is to bear the insurer's costs, as agreed or assessed.
[14]
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: 06 March 2025
Parties
Applicant/Plaintiff:
Atwal
Respondent/Defendant:
Insurance Australia Limited trading as NRMA Insurance