The basis of the decisions of the PIC giving rise to these proceedings is partially explained in Annexure "E" to the affidavit of Frances Allen sworn 6 June 2022 (exhibit A) in the matter of Condon v Bartley:
The Commission has reviewed the application to resolve a medical dispute. The Commission's preliminary opinion is that it may not be allowed to determine the dispute and instead, the District Court should determine it. This is because the parties to the dispute may potentially be the State of NSW and a resident of another State …
Importantly:
1) The Insurer, GIO, and the claimant are the parties to the medical dispute. The claimant resided in the State of QLD on the date the application was filed with the Commission.
2) A Judge has not decided if GIO is legally considered to be the State of NSW.
3) An immediate consequence of Judge Gibb's reasoning in Ritchie v Nominal Defendant (District Court 5 November 2021) is that the Commission does not have jurisdiction to assess any medical dispute, merit review matter, miscellaneous assessment matter or damages dispute between a State and a resident of another State.
Condon v Bartley; Hayes v RACQ Insurance Limited; Smith v Allianz Australia... [2022] NSWDC 282 | Case summary | Zoe
As Priestley SC DCJ found in Stanton, the position of the Nominal Defendant considered by Gibb DCJ in Ritchie is not analogous to the position of an NSW licensed CTP insurer under the motor accident legislation. Section 32(1) of the Motor Accident Injuries Act 2017 provides that for the purposes of that Act the State Insurance Regulatory Authority is the Nominal Defendant. There is no doubt that the State Insurance Regulatory Authority is "the State of New South Wales" for the reasons explained by Priestley SC DCJ in Stanton at [12]. No such factors apply to the licensed insurers.
Annexure "E" to Ms Allen's affidavit in Condon refers to a publication by the PIC "What is federal jurisdiction and how does it affect applications".
The publication also provides information relating to the Commission's approach to disputes potentially involving exercise of federal jurisdiction:
The Personal Injury Commission cannot determine an application if it would be required to exercise federal jurisdiction to make that determination …
Federal jurisdiction is the authority to exercise the judicial power of the Commonwealth and that includes the power to determine disputes between:
States; or
residents of different States; or
a State and a resident of another State …
Importantly, Division 3.2 of the Personal Injury Commission Act 2020 enables persons, with leave of the District Court, to commence proceedings in that Court for the determination of applications that the Commission cannot determine because those applications involve the exercise of federal jurisdiction.
The publication then states that applications that can be affected include claims for damages under the Motor Accidents Compensation Act 1999, claims for statutory benefits or damages under the Motor Accident Injuries Act 2017 and applications relating to such claims including medical assessments, merit reviews and a review of or appeal from such decisions.
The publication explains that having regard to the decision in Ritchie, the Commission cannot determine a matter where the Nominal Defendant is a party and the other party is a resident of a State other than New South Wales, because it would be required to exercise federal jurisdiction.
The publication then refers to the decision of Priestley SC DCJ in Stanton:
On 11 April 2022, a Judge determined that one licensed CTP insurer in NSW, namely NRMA Pty Ltd is a private corporation and so, when that insurer is a party to a proceeding they should not be treated as a particular State …
Priestley SC, DCJ determined that NRMA, as a company limited by shares, carrying out the commercial activity of insurance, was not part of the State of NSW. NRMA's functions were not analogous to those of the Nominal Defendant/SIRA and therefore the decision in Ritchie was not relevant.
Some commentators have said that this decision should represent a binding precedent in respect of any dispute between an interstate resident and any NSW CTP insurer. The Commission notes that this decision related specifically to NRMA Pty Ltd and its precedent value is also related specifically to NRMA Pty Ltd. [emphasis added]
The evidence before the Court demonstrates that all other NSW licensed insurers participating in the motor accident scheme in New South Wales are in the same position as NRMA in Stanton. They are companies limited by shares with separate corporate structures and functions and can in no way be regarded as the State or analogous to the Nominal Defendant.
The purpose of these proceedings is for the court to make findings and orders relating to all licensed insurers participating in the motor accident scheme in New South Wales under the present and previous motor accident legislation (other than NRMA) to the same effect as the findings and orders by Priestley SC DCJ in Stanton.
[2]
INTERSTATE CTP INSURERS
Some of the motor vehicles causing accidents in NSW are registered and carry CTP insurance from interstate.
Three States have a single government-owned and government-controlled CTP insurer:
1. Victoria - The Transport Accident Commission (TAC);
2. Tasmania - The Motor Accident Insurance Board (MAIB);
3. Western Australia - The Insurance Commission of Western Australia (ICWA).
There is no dispute that these three entities are relevantly their respective "States". The issue was not disputed before and accepted by the High Court in Sweedman v Transport Accident Commission [2006] HCA 8. Claims for damages in relation to a motor accident in New South Wales by residents of any Australian State against one of these three "government insurers" will give rise to federal jurisdiction except where the claimant is resident in the same State as the insurer. For example, a Victorian claimant against TAC.
However, claims by NSW residents (or residents of any other state injured in a motor vehicle accident in NSW) against non-government insurers licensed in other States does not give rise to federal jurisdiction as private insurers are not part of the State.
Queensland is geographically proximate to NSW. Queensland registered vehicles periodically cause accidents in NSW. Suncorp and RACQ are two large, non-government owned Queensland licensed CTP insurers. Allianz and QBE are also licensed CTP insurers in Queensland in addition to being licensed CTP insurers in NSW.
As illustrated by the Hayes matter, the PIC raises federal jurisdiction in disputes between NSW residents and Queensland CTP insurers on the basis of the lack of a District Court judicial finding that these insurers are not part of the State of Queensland. Therefore, these proceedings also seek findings and orders that Suncorp and RACQ (Queensland licensed insurers) are not part of the State of Queensland (or any other state).
[3]
Consideration
Section 75 of the Constitution provides as follows:
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.
Only s.75 (iv) is relevant to the issues in these proceedings.
The first question is whether a licensed insurer participating in the New South Wales and Queensland motor accident schemes is "a State" so that a matter between that licensed insurer and a resident of another State invokes federal jurisdiction.
Each of the licensed insurers involved in the proceedings before the Court are companies in no way analogous to the Nominal Defendant. None of these licensed insurers can be described as a part or instrument or agent of the State of New South Wales or Queensland. The insurers participate in the respective motor accident schemes established by the Motor Accident Injuries Act 2017 (NSW) and its predecessor, and the Motor Accident Insurance Act 1994 (Qld) but do so on a commercial basis. The insurers receive income from their participation in these schemes and are accountable to their shareholders and principals.
All licensed insurers in NSW and Queensland participate in their respective schemes in the same way as NRMA participate in the NSW scheme. All of the insurers in these proceedings, and indeed all insurers licensed to participate in the present motor accident scheme and its predecessor, and its Queensland equivalent are in exactly the same position as NRMA in NSW and are not to be regarded as "the State of New South Wales" or "the State of Queensland" for the reasons given by Priestley SC DCJ in Stanton which I, respectfully, endorse and adopt.
As determined by Gibb DCJ in Ritchie, the State Insurance Regulatory Authority, or such other entity as may hold the same statutory functions, "is the Nominal Defendant", by virtue of s.32(1) of the Motor Accident Injuries Act 2017 but is not identified as any of the licensed insurers. To the contrary, its function as regulator is separate and distinct from the powers and functions of the PIC and is separate and distinct from the rights and obligations of the insurers.
Nor is there any provision of the Motor Accident Injuries Act 2017 or its predecessor that could in any way be construed as including an insurer in "the State of New South Wales". To the contrary, the Acts provide for rights and obligations of the insurers; in some cases, the obligations of insurers are expressed to be a condition of their licences.
The status of each insurer (except NRMA) as a corporation independent of the State of New South Wales or the State of Queensland is addressed in affidavits filed in each matter.
In each case, the PIC has refused to accept the submissions of one or both of the parties that the insurer concerned is not part of the State.
All parties to these proceedings submitted that the Court should find that each of the New South Wales insurers involved in the proceedings, as well as CIC Allianz Insurance Ltd and Youi Pty Ltd, are not the State of New South Wales. Likewise, it was submitted that the Court should find that AAI Ltd t/as Suncorp and RACQ are not the State of Queensland. I accept those submissions and make those findings.
None of the licensed insurers are a "resident" of any State of Australia for the purposes of s.75(iv) of the Constitution because the words "residents" and "resident" in s.75(iv) refer only to natural persons not corporations: Crouch v Commissioner for Railways (Qld) (1985) 62 ALR 1.
The parties to a dispute before the PIC are the claimant (the injured person) and the insurer. The driver or owner insured by the insurer is not a party in a matter before the Commission.
As Priestley SC DCJ explained in Stanton at [34ff], the structure of both the Motor Accident Injuries Act and its predecessor leads to the conclusion that a claim for statutory benefits and/or damages is in reality and in fact a claim against the insurer. The insurer receives the claim; the insurer has unfettered power to deal with the claim, subject only to its obligations under the Acts; the liability for the claim falls to the insurer alone; decisions in relation to the claim, including applications for determination of disputes and the defence of applications brought by the claimant are made by the insurer without reference to the driver or owner alleged or deemed to be at fault; the hearing of a merits dispute involves the claimant and the insurer; the application, reply and material provided in relation to a medical dispute are prepared and lodged by the claimant and the insurer. The insured (the owner and or driver of the motor vehicle at fault) has no role whatsoever or right to be heard in respect of any such dispute.
As Priestley SC DCJ pointed out, it is also consistent with the objects of both Acts that the insurer responds to a claim in its own right, the insurer being in the position to ensure that the objects of the Acts are promoted.
[4]
Condon v Bartley
AAI Ltd t/as GIO is a corporation and does not form part of the State of NSW.
AAI Ltd t/as GIO is not a resident of the State of NSW or any other State or Territory.
The parties to any dispute in respect of this matter which is referred to the PIC are the licensed insurer (AAI Ltd t/as GIO), and the plaintiff.
As an ancillary matter, I also find that 2 other subsidiaries of AAI Limited, namely Suncorp and AAMI do not form part of a State or are residents of a State or Territory.
[5]
Hayes v RACQ Insurance Limited
RACQ is a corporation and does not form part of the State of Queensland.
RACQ is not a resident of the State of Queensland or any other State or Territory.
The parties to any dispute in respect of this matter which is referred to the PIC are the licensed insurer (RACQ) and the Plaintiff.
[6]
Smith v Allianz Australia Insurance Ltd
Allianz is a corporation and does not form part of the State of NSW.
Allianz is not a resident of the State of NSW or any other State or Territory.
The parties to any dispute in respect of this matter which is referred to the PIC are the licensed insurer (Allianz) and the Plaintiff.
[7]
Ward v QBE Insurance (Australia) Ltd
QBE is a corporation and does not form part of the State of NSW.
QBE is not a resident of the State of NSW or any other State or Territory.
The parties to any dispute in respect of this matter which is referred to the PIC are the licensed insurer (QBE) and the Plaintiff.
[8]
Hackett v Allianz Australia Insurance Ltd
Allianz is a corporation and does not form part of the State of NSW.
Allianz is not a resident of the State of NSW or any other State or Territory.
The parties to any dispute in respect of this matter which is referred to the PIC are the licensed insurer (Allianz) and the Plaintiff.
As an ancillary matter based on the evidence in these proceedings, I find that Youi Pty Ltd does not form part of a State and is not a resident of a State or Territory.
[9]
Scope of findings
For clarity, whilst these proceedings relate to GIO, Allianz, QBE and RACQ, I intend for the findings to also extend to the following companies:
1. AAI Ltd t/as Suncorp;
2. AAI Ltd t/as AAMI;
3. CIC Allianz Insurance Ltd; and
4. Youi Pty Ltd.
[10]
Condon v Bartley
In relation to the Motion filed by the defendant on 6 June 2022, by consent the Court makes the following orders:
1. leave to the parties to make a compensation matter application to the Court refused pursuant to Section 26(3) of the Personal Injury Commission Act 2020 (NSW) ["the PIC Act"] on the basis that the determination of the matter by the usual decision maker would not involve any exercise of federal jurisdiction (being a dispute between a resident of Queensland and the defendant's compulsory third party insurer, AAI Ltd t/as GIO, a corporation that does not form part of the State of New South Wales);
2. pursuant to Section 26(5) of the PIC Act, remit the matter for determination by a medical assessor at the PIC on the basis that a medical assessor does have jurisdiction to determine the medical dispute;
3. pursuant to Section 26(6) of the PIC Act, the PIC is ordered to determine the medical dispute on an expedited basis, given the delays that have been occasioned in the matter by virtue of the PIC raising an issue of federal jurisdiction;
4. the defendant to pay the plaintiff's regulated costs of the Notice of Motion.
[11]
Hayes v RACQ Insurance Limited
In relation to the Summons filed on 7 April 2022, by consent the court orders:
1. leave to the parties to make a compensation matter application to the District Court refused pursuant to Section 26(3) of the Personal Injury Commission Act 2020 (NSW) ["the PIC Act"] on the basis that the determination of the matter by the usual decision maker would not involve any exercise of federal jurisdiction (being a dispute between a resident of New South Wales and RACQ Insurance Ltd, a corporation that does not form part of the State of New South Wales or the State of Queensland);
2. pursuant to Section 26(5) of the PIC Act, remit the matter for determination by a PIC Member at the PIC on the basis that a PIC Member does have jurisdiction to determine the assessment of damages;
3. given the initial application for damages assessment (PIC Application #M10486197/22) was lodged within 3 years of the subject accident, pursuant to Section 26(6) of the PIC Act, the PIC is ordered to:
1. withdraw the PIC decision of 31 March 2022 dismissing the plaintiff's application lodged by the plaintiff seeking an assessment of damages; and
2. treat the application as if it had been filed (as it was) on 18 January 2021;
1. the defendant to pay the plaintiff's regulated costs of the Summons.
[12]
Smith v Allianz Australia Insurance Ltd
In relation to the Summons filed on 6 April 2022, by consent the courts makes the following orders:
1. leave to the parties to make a compensation matter application to the District Court refused pursuant to Section 26(3) of the Personal Injury Commission Act 2020 (NSW) ["the PIC Act"] on the basis that the determination of the matter by the usual decision maker would not involve any exercise of federal jurisdiction (being a dispute between a resident of Victoria and Allianz Australia Insurance Ltd, a corporation that does not form part of the State of New South Wales);
2. note that subsequent to the filing of the Summons, the defendant has conceded that the plaintiff's injuries exceed the 10% whole person impairment threshold, thus removing any current necessity for any medical dispute to be referred to the PIC for determination;
3. accordingly, Summons dismissed;
4. the defendant to pay the plaintiff's regulated costs of the Summons.
[13]
Ward v QBE Insurance (Australia) Ltd
In relation to the Summons filed on 6 June 2022, by consent the Court orders:
1. leave to the parties to make a compensation matter application to the District Court refused pursuant to Section 26(3) of the Personal Injury Commission Act 2020 (NSW) ["the PIC Act"] on the basis that the determination of the matter by the usual decision maker would not involve any exercise of federal jurisdiction (being a dispute between a resident of Victoria and QBE Insurance (Australia) Ltd, a corporation that does not form part of the State of New South Wales);
2. pursuant to Section 26(5) of the PIC Act, remit the medical dispute for determination by a medical assessor at the PIC on the basis that a medical assessor does have jurisdiction to determine the medical dispute;
3. pursuant to Section 26(6) of the PIC Act, the PIC is ordered to determine the medical dispute on an expedited basis, given the delays that have been occasioned in the matter by virtue of the PIC raising an issue of federal jurisdiction;
4. pursuant to Section 26(5) of the PIC Act, remit the assessment of damages for determination by a PIC Member at the PIC (as and when the medical dispute has been determined and the matter is ready for assessment) on the basis that a PIC Member does have jurisdiction to determine the assessment of damages;
5. given the initial application for damages assessment (PIC Application #M10486197/22) was lodged within 3 years of the subject accident, pursuant to Section 26(6) of the PIC Act, the PIC is ordered to:
1. withdraw the PIC decision of 6 May 2022 dismissing the plaintiff's application lodged by the plaintiff seeking an assessment of damages; and
2. treat the application as if it had been filed (as it was) on 21 December 2020;
1. the defendant to pay the plaintiff's regulated costs of the Summons.
[14]
Hackett v Allianz Australia Insurance Ltd
In relation to the Summons filed by the defendant on 26 May 2022;
1. leave to the parties to make a compensation matter application to the District Court refused pursuant to Section 26(3) of the Personal Injury Commission Act 2020 (NSW) ["the PIC Act"] on the basis that the determination of the matter by the usual decision maker would not involve any exercise of federal jurisdiction (being a dispute between a resident of Queensland and Allianz Australia Insurance Ltd, a corporation that does not form part of the State of New South Wales);
2. pursuant to Section 26(5) of the PIC Act, remit the medical dispute for determination by a medical review panel at the PIC on the basis that a medical review panel does have jurisdiction to determine the medical dispute;
3. pursuant to Section 26(6) of the PIC Act, the PIC is ordered to convene the medical review panel on an expedited basis, given the delays that have been occasioned in the matter by virtue of the PIC raising an issue of federal jurisdiction;
4. the defendant to pay the plaintiff's regulated costs of the Summons.
[15]
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: 22 July 2022
Legislation Cited (5)
(Section 75(iv)) Motor Accidents Compensation Act 1999(NSW)
The proceedings before the Court directly concern all but three third party insurers licensed under the Motor Accidents Compensation Act 1999 and the Motor Accident Injuries Act 2017. The exceptions are NRMA, Youi Pty Ltd (Youi) and CIC Allianz Insurance Ltd (CIC Allianz). The issues set out above were determined in relation to NRMA by Priestley SC DCJ in Stanton v Winning [2022] NSWDC 104. There are no decisions by the PIC involving Youi to date that involve these issues.
The proceedings also directly concern one Queensland-based and licensed CTP insurer (RACQ Insurance Limited (RACQ)) and indirectly address another (AAI Ltd t/as Suncorp (Suncorp)).
The PIC has dismissed a number of applications for determination of disputes where, in the opinion of a Member, determination of that dispute may potentially require the exercise of federal jurisdiction. That has given rise to the parties approaching this Court either for determination of the application previously made to, and refused by, the Commission, or for remittal to the Commission. All five matters have been remitted.
The following facts relating to the five matters before the Court are drawn from the affidavit evidence and Summons and are not in dispute.