GIO GENERAL LIMITED v SMITH & Ors INSURANCE AUSTRALIA LTD T/as NRMA... [2011] NSWSC 802 | Case summary

GIO GENERAL LIMITED v SMITH & Ors INSURANCE AUSTRALIA LTD T/as NRMA... [2011] NSWSC 802 | Case summary | Zoe

Judgment 1HIS HONOUR: Nature of proceedings The first defendant in each Summons, Graham Smith, suffered physical injuries in two motor accidents which occurred 12 March 2007 and 27 November 2007. Mr Smith also claimed to have suffered psychiatric injury as a result of one, or both, of those motor accidents. 2GIO General Limited (GIO), the plaintiff in the 2010 proceedings, was the compulsory third party (CTP) insurer in connection with the first motor accident of 12 March 2007. Insurance Australia Limited T/as NRMA Insurance (NRMA), the plaintiff in the 2011 proceedings, was the CTP insurer in connection with the second motor accident on 26 November 2007. 3In its Summons, GIO seeks the following orders:

A declaration that the Review Panel Certificate (and Reasons) dated 23 September 2010, issued by a Review Panel appointed by the Second Defendant under s63 of the Motor Accident Compensation Act 1999, is affected by an error of law on the face of the record, and/or jurisdictional error.
An order in the nature of certiorari, quashing the said Review Panel Certificate (and reasons).
An order that the matter be remitted to the Second Defendant to be reconsidered by a Review Panel in conformity with the reasons of this Court. 4NRMA in an Amended Summons seeks the same orders. 5Mr Smith does not concede any error in the Review Panel's Certificate or Reasons and opposes the relief sought by GIO and NRMA in each Summons. The Motor Accidents Authority of NSW (MAA), which is the second defendant in each Summons, entered a submitting appearance and played no active part in the argument before the Court. Factual background 6As indicated, Mr Smith was involved in two motor accidents - 12 March 2007 and 26 November 2007. GIO was the CTP insurer for the first and NRMA the CTP insurer for the second. On 14 May 2009 Mr Smith lodged with the MAA an Application for Assessment of a Permanent Impairment Dispute in accordance with the provisions of the Motor Accident Compensation Act 1999 (the Act). On 27 May 2009 GIO responded with a Reply to an Application for Assessment of a Permanent Impairment Dispute. Mr Smith filed a similar application in relation to the second accident on 30 April 2009 and NRMA responded to that application with its Reply dated 20 May 2009. The content of those two applications and the replies by the CTP insurers are not relevant to these proceedings. 7On 7 July 2009 the MAA referred the matter to Dr Ben Teoh, a psychiatrist, as a Medical Assessor in accordance with s60 of the Act. The referral was described as a "Multiple Accident Referral" and required Dr Teoh to certify for each accident:

The list of injuries referred and whether they were each found to have been caused by the accident.
The degree of permanent impairment of the injured person as a result of each of those injuries referred that were found to be caused.
Whether the degree of permanent impairment of the injured person as a result of those injuries referred that were found to be caused, is greater than 10 percent. Dr Teoh was required to issue a separate certificate for each accident. The injury which was referred and which he was required to assess in respect of each accident was "Psychological - psychological trauma". 8On 5 September 2009 Dr Teoh issued a Certificate in respect of each accident and a Statement of Reasons. The Certificate in respect of each accident identified the injury as "chronic adjustment disorder with depressed and anxious mood" and stated that the injuries caused by each motor accident gave rise to a permanent impairment of greater than 10 percent. In each motor accident, Dr Teoh assessed the extent of whole person impairment having been caused by that accident at 15 percent. The content of the Certificates and Statement of Reasons of Dr Teoh are otherwise irrelevant to these proceedings. 9On 16 October 2009 GIO lodged with the MAA an Application for Review of a Medical Assessment by the Medical Assessment Service in respect of the assessment of Dr Teoh. On 11 November 2009 NRMA lodged a similar application with the MAA in respect of the assessment of Dr Teoh. On 21 and 23 December 2009 Mr Smith lodged Replies to the Applications made by GIO and NRMA. 10On 4 February 2010 the MAA advised Mr Smith that the Proper Officer had considered the Applications and was satisfied that there was reasonable cause to suspect that the Assessment had been incorrect in a material respect. On 16 March 2010 the MAA advised Mr Smith that a Review Panel had been convened in respect of the Application for Review. On 21 May 2010 a further examination took place of Mr Smith by two members of the Review Panel, Drs Parsonage and Lewin. In accordance with s63 of the Act, the Review Panel was to perform the same function as had been referred to Dr Teoh. 11The Certificate and Reasons of the Review Panel in relation to the 12 March 2007 accident and the Certificate and Reasons of the Review Panel in relation to the 26 November 2007 accident were each issued on 23 September 2010. 12Correspondence was sent on behalf of GIO and NRMA to the MAA seeking that the matter be referred back to the Review Panel for the correction of an obvious error. The MAA declined to do so resulting in the filing of the Summonses now before the Court. 13The Certificates issued by the Review Panel are in identical terms except that the date of the motor accident is different in each Certificate. The issue in respect of which the Review Panel Certificate was issued was: "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 percent." The Assessment made by the Review Panel under s63(4) of the Act was as follows: "The Panel revokes its Certificate dated 5 September 2009 and issues a new Certificate determining that: The following injuries caused by the motor accident give rise to a whole person impairment which, in total, IS GREATER THAN 10%:
Major Depressive Disorder Details of the review are set out in the reasons below, which form part of this certificate." 14The significance of the issuing of two certificates in that form was that it enabled Mr Smith to claim damages for non-economic loss for his psychiatric condition in respect of each motor accident (s91). 15In their reasons, the Review Panel summarised the evidence which they had taken into account including the results of the examination of Mr Smith. At p8 of the Certificate under Section 3 headed "Matters Considered and Decided by the Panel", the Review Panel said: " C. Panel Deliberations This was a complex matter and the Panel struggled to apply the Motor Accidents Authority Permanent Impairment Guidelines, 1 October 2007 ("The Guidelines") to come to a decision that was correct and fair. The panel addressed the following issues and made the following findings. Although Mr Smith was physically disabled before the first accident and he had had previous treatment for a psychiatric condition, the panel found that he was not suffering a diagnosable psychiatric disorder causing permanent impairment before the first accident. The last reference to any psychiatric or psychological treatment before the first accident was in Dr Liew's notes, dated 31 May 2006, when his antidepressant medication Cipramil was ceased. In relation to the first accident on 12 March 2007, the panel concluded that this caused, or at least exacerbated, previous physical injuries which caused Mr Smith to experience pain but there was no objective evidence of a diagnosable psychiatric disorder after the first accident and before the second accident on 26 November 2007. There is no reference to psychological symptoms in the clinical records during that period and no evidence that Mr Smith had any psychiatric or psychological treatment in between the first and the second accident. In relation to the second accident, the panel found that the motor accident of 26.11.07 aggravated pre-existing conditions of the neck and spinal surgery and aggravated a pre-existing thoracic spinal injury. The panel found that subsequent to the second motor accident and, in the context of ongoing pain and disability from which Mr Smith was not improving during 2008 to 2009, he became significantly depressed, and his depressive symptoms satisfied DSM-IV criteria for non-melancholic Major Depressive Disorder. Cause of Injury The panel concluded that both motor accidents materially contributed to Mr Smith's Major Depressive Disorder because both accidents caused or exacerbated painful and disabling physical conditions to which his Major Depressive Disorder was secondary. Assessment of Permanent Impairment The panel concluded that Mr Smith's Major Depressive Disorder had stabilised. He had had psychiatric treatment and there had been no significant change in his condition over the previous six months and, taking into account the ongoing painful disabling conditions to which his Major Depressive Disorder was secondary, it was considered that the permanent impairment associated with Mr Smith's Major Depressive Disorder was unlikely to change substantially in the next year with or without medical treatment. Having concluded that both accidents were a cause of Mr Smith's Major Depressive Disorder which gave rise to permanent impairment, the panel assessed Mr Smith's permanent impairment in relation to each motor accident. Firstly the panel assessed Mr Smith's current level of permanent impairment attributable to his Major Depressive Disorder. This was done using the methods outlined in The Guidelines as shown in the Table in Section 4. The panel spent a considerable amount of time considering the question of apportionment for pre-existing and subsequent impairment. Initially the panel's approach was to assess the permanent impairment in relation to the second accident. The second accident was a cause of the claimant's Major Depressive Disorder which gave rise to a whole person impairment. There was no pre-existing psychiatric diagnosis or condition before the second accident so therefore there was no deduction and all the impairment was attributed to the second accident. By inference, the panel initially considered that the first accident therefore caused no impairment. The panel then took into account the case of Ackling v QBE Insurance (Australia) Limited and Anor [2009] NSWSC 881 . In that matter it was found that impairment occurring after a second injury could be attributable to an initial motor accident which caused physical injuries without a psychiatric disorder being apparent until after a second injury exacerbated the first injury. The panel concluded that the impairment caused by the claimant's Major Depressive Disorder arose from injuries sustained in both accidents. In relation to the first accident the panel found that there was no permanent impairment prior to the first accident for the reasons given above. The panel considered clause 1.36 of The Guidelines which begins: "The evaluation of permanent impairment may be complicated by the presence of an impairment in the same region that has occurred subsequent to the relevant motor accident". This appeared to be the relevant section of The Guides however it continues: "If there is objective evidence of a subsequent and unrelated injury or condition (emphasis added) resulting in permanent impairment in the same region, this value should be calculated. Permanent impairment arising from the relevant motor accident should also be calculated. If there is no evidence of subsequent impairment its possible presence should be ignored". In this case, it was the panel's view that, although the second accident did cause a subsequent injury, it was not "an unrelated injury" because it exacerbated injuries from the first accident, so the effect of the second accident could not be deducted. The panel concluded that neither Section 7.18 or 1.36 applied to the impairment arising from either accident. The panel was mindful that its role was not to fractionate damages but was rather to determine whether an injury was caused by the accident, the degree of permanent impairment of the injured person as a result of any injury that was found to be caused and whether the degree of permanent impairment of the injured person, as a result of that injury that was found to be caused, is greater than 10%. The panel did not agree with the conclusions of the MAS Assessor assessments under review for the following reasons. Firstly, it found that the diagnosis of the claimant was Major Depressive Disorder not an Adjustment Disorder. This was on the basis that the claimant's symptoms satisfied DSM-IV criteria for Major Depressive Disorder and in that case a diagnosis of an Adjustment Disorder is not made. Secondly, the panel's assessment of the claimant's permanent impairment was different to the assessment made by Assessor Teoh. The panel was not satisfied with the reasons given by Assessor Teoh for some of his impairment ratings and, at any rate, the panel assessed Mr Smith at a later time and it is possible there may have been some change in the degree of his impairment. Finally, the panel disagreed with the methodology that Assessor Teoh used in determining apportionment and preferred the methodology explained above." 16The Review Panel then applied the "Psychiatric Impairment Rating Scale" (PIRS) set out in paragraph 7.19 of the Permanent Impairment Guidelines issued by the MAA and gave to Mr Smith a numerical rating under each of those headings. This resulted in a calculation of 17 percent whole person impairment (WPI). 17The Review Panel's reasons then concluded as follows: " Apportionment Apportionment was not undertaken for the reasons given above. In particular neither Section 7.18 nor 1.36 of The Guides were applicable in these matters for the reasons given above. Determination Regarding the Degree of Whole Person Impairment of the Injured Person as a Result of the Injuries Caused by the Motor Accident The total percentage whole person permanent impairment for assessed psychiatric injuries caused by the motor accident is 17%. Therefore the total whole person impairment is greater than 10%. This determination as to permanent impairment is made in accordance with the American Medical Association's Guides to the Evaluation of Permanent Impairment (Fourth Edition) and the Motor Accident Authority's Impairment Assessment Guidelines. Permanent impairment ratings take symptoms into account, however the percentage whole person permanent impairment is not a direct measure of disability. A finding of zero percent whole person impairment indicates that there was an injury caused by the motor accident and that there may be continuing symptoms, however, relevant Guides rate the associated impairment at 0% WPI. Permanent Impairment The Review Panel's findings in relation to the degree of permanent impairment of the psychiatric injuries caused by the accident are different to the findings as stated in the Permanent Impairment certificate issued by Assessor Teoh. The diagnosis of the injury is changed from Chronic Adjustment Disorder with Depressed and Anxious mood to Major Depressive Disorder. Accordingly, the Review Panel has determined that this certificate is to be revoked and a new Permanent Impairment certificate has been issued by the Review Panel.

Issues raised by the Parties In relation to the issues raised in the applications, the Panel agreed that these have all been dealt with in Section 3 above. The panel wants its decision clearly understood, especially when consideration is given to the amount of compensation to be made in relation to each accident. By applying The Guidelines, the panel was obliged to conclude, for the reasons given above, that both accidents caused Major Depressive Disorder which gave rise to a permanent impairment of 17%, which was greater than 10%. Just as it would have been unfair to the claimant if the 17% WPI had been divided by the two accidents resulting in each accident being said to cause an impairment of 8.5%) (ie not greater than 10%), it would also be unfair if the panel's decision was misconstrued to imply that each accident caused two separate injuries of Major Depressive Disorder each producing a WPI of 17%. Rather it was the panel's decision that both accidents together caused a Major Depressive Disorder which gave rise to a WPI of 17% but by applying The Guidelines the panel was obliged to certify that each accident caused Major Depressive Disorder giving rise to a whole person impairment which is greater than 10%." Submissions and consideration 18The following sections of the Act were referred to by the parties in submissions: "63 Review of medical assessment by review panel (1) A party to a medical dispute may apply to the proper officer of the Authority to refer a medical assessment under this Part by a single medical assessor to a review panel of medical assessors for review. (2) An application for the referral of a medical assessment to a review panel may only be made on the grounds that the assessment was incorrect in a material respect. (2A) If a medical assessment under this Part (a combined certificate assessment) is based on the assessments of 2 or more single medical assessors (resulting in a combined certificate as to the total degree of permanent impairment), the combined certificate assessment cannot be the subject of review under this section except by way of the review of any of the assessments of the single medical assessors on which the combined certificate assessment is based. (3) The proper officer of the Authority is to arrange for any such application to be referred to a panel of at least 3 medical assessors, but only if the proper officer is satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect having regard to the particulars set out in the application. (3A) The review of a medical assessment is not limited to a review only of that aspect of the assessment that is alleged to be incorrect and is to be by way of a new assessment of all the matters with which the medical assessment is concerned. (4) The review panel may confirm the certificate of assessment of the single medical assessor, or revoke that certificate and issue a new certificate as to the matters concerned. (5) If on the review of a medical assessment of a single medical assessor on which a combined certificate assessment is based a new certificate is issued by the review panel, the review panel is also to issue a new combined certificate to take account of the results of the review. (6) Section 61 applies to any new certificate or new combined certificate issued under this section. (7) The MAA Medical Guidelines may limit the time within which an application under this section may be made." " 65 MAA monitoring and oversight (1) Medical assessments under this Part are subject to relevant provisions of MAA Medical Guidelines relating to the procedures for the referral of disputes for assessment or review of assessments and the procedure for assessment. ... " 133 Method of assessing degree of impairment (1) The assessment of the degree of permanent impairment of an injured person as a result of the injury caused by a motor accident is to be expressed as a percentage in accordance with this Part. (2) The assessment of the degree of permanent impairment is to be made in accordance with: (a) MAA Medical Guidelines issued for that purpose, or (b) if there are no such guidelines in force-the American Medical Association's Guides to the Evaluation of Permanent Impairment, Fourth Edition. (3) In assessing the degree of permanent impairment under subsection (2) (b), regard must not be had to any psychiatric or psychological injury, impairment or symptoms, unless the assessment of the degree of permanent impairment is made solely with respect to the result of a psychiatric or psychological injury. Note. See Part 3.1 for MAA Medical Guidelines." 19While it is accepted that the Permanent Impairment Guidelines (the Guidelines) issued by the MAA are delegated legislation (s44(1)(c) of the Act) Ackling v QBE Insurance (Aust) Ltd & Anor [2009] NSWSC 881; [2009] 53 MVR 377 at [83] and cannot affect the proper construction of the Act, this issue did not arise here. Accordingly, the Guidelines indicate how relevant assessments are to be carried out ( Allianz Australia Insurance Ltd v Crazzi [2006] NSWSC 1090; [2006] 68 NSWLR 266; (2006) 47 MVR 74 at [17]; Paice v Hill [2009] NSWCA 156; [2009] 53 MVR 114 at [2] - [3] and [59] - [60]). As such the Review Panel was obliged to follow the Guidelines when carrying out its function. 20The following Guidelines were referred to: "1.3 The Convention used in these MAA Guidelines is that if the text is in bold, it is a directive as to how the assessment should be performed. 1.23 The evaluation should only consider the impairment as it is at the time of the assessment. 1.33 The evaluation of the permanent impairment may be complicated by the presence of an impairment in the same region that existed prior to the relevant motor accident. If there is objective evidence of a pre-existing symptomatic permanent impairment in the same region at the time of the accident, then its value should be calculated and subtracted from the current whole person impairment value. If there is no objective evidence of pre-existing symptomatic permanent impairment, then its possible presence should be ignored. 1.36 The evaluation of permanent impairment may be complicated by the presence of an impairment in the same region that has occurred subsequent to the relevant motor accident. If there is objective evidence of a subsequent and unrelated injury or condition resulting in permanent impairment in the same region its value should be calculated. The permanent impairment resulting from the relevant motor accident should also be calculated. If there is no objective evidence of the subsequent impairment its possible presence should be ignored." 21Chapter 7 of the Guidelines deals with the assessment of Mental and Behavioural Disorders Impairment. "7.4 The Assessment of Mental and Behavioural Disorders must be undertaken in accordance with the Psychiatric Impairment Rating Scale as set out in these MAA Guidelines. Chapter 14 of the AMA 4 Guides (pp 291-302) is to be used for background or reference only." "7.13 The impairment must be attributable to a recognised psychiatric diagnosis in accordance with the Diagnostic Statistics Manual of Mental Disorders (4th Edition) [DSM IV], Internal Classification of Diseases (10th Edition) ['CD 10] or a substantial body of peer review research literature. The impairment evaluation report must specify the diagnostic criteria upon which the diagnosis is based. 7.14 Impairment due to physical injury, for example, deficits in self-care or travel caused by brain or spinal cord injury, is assessed using different criteria by nervous system impairment assessors. 7.15 The PIRS is not to be used to measure impairment due to pain or somatoform disorders. 7.16 Where cognitive deficits are suspected, the assessor must carefully consider the history of the injury, medical treatment and progress through rehabilitation. The assessor will also take into account results of CT and MRI scans, electroencephalograms (EEGs) and results of psychometric tests. 7.17 The scale is to be used by a properly trained assessor Clinical judgment will be the most important tool in the application of the scale. The impairment rating must be consistent with a recognised psychiatric diagnosis, and clinical experience. 7.18 In order to measure impairment caused by a specific event, the assessor must , in the case of an injured person with a pre-existing psychiatric diagnosis or condition, estimate the overall pre-existing impairment using precisely the method set out in this Chapter, and subtract this value from the current impairment rating. The Psychiatric Impairment Rating Scale 7.19 Behavioural consequences of psychiatric disorder are assessed on six 'Areas of Function', each of which evaluates an area of functional impairment:

Self-care and personal hygiene (Table 7.1) Social and recreational activities (Table 7.22) Travel (Table 7.3) Social functioning (relationships) (Table 7.4) Concentration, persistence and pace (Table 7.5) Adaptation (Table 7.6) Submissions 22It was common ground that Major Depressive Disorder was the "injury" in respect of which the Review Panel was required under ss 58, 61 and 63 of the Act to assess "the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident(s)". 23It was also common ground that the Review Panel was required to determine causation of Mr Smith's Major Depressive Disorder. No criticism is made by any of the parties of the Review Panel's finding as to causation, i.e. "that both motor accidents materially contributed to Mr Smith's Major Depressive Disorder because both accidents caused or exacerbated painful or disabling physical conditions to which his Major Depressive Disorder was secondary" and that applying the PIRS methodology prescribed by the Medical Assessment Guidelines, Mr Smith's total whole person impairment as a result of the Major Depressive Disorder was 17 percent. 24It is in relation to the subsequent steps that the parties disagree. 25While accepting that the Review Panel's finding as to causation was open to it, GIO submitted that thereafter in assessing permanent impairment arising from each accident, the Review Panel had wrongly interpreted the decision of Johnson J in Ackling v QBE . When referring to that decision, the Review Panel said: "In that matter it was found that impairment occurring after a second injury could be attributable to an initial motor accident which caused physical injuries, without a psychiatric disorder being apparent until after a second injury exacerbated the first injury." 26GIO submitted that this was not a "finding" of Johnson J, but rather a summary by Johnson J in the course of his judgment of submissions made by QBE in that case. GIO submitted that when Johnson J accepted the submissions of QBE and the MAA in that case, the submissions which he accepted were those relating to the proper construction of s58(1)(d) of the Act, i.e. Johnson J found that an inherent part of the medical assessment process was the determination by a medical assessor of whether an injury was "caused" by a particular motor accident. 27GIO submitted that this misinterpretation of what Johnson J decided in Ackling , distracted the Review Panel from its proper statutory task of construing and applying the Guidelines. 28The submission by GIO concerning the misinterpretation of Ackling v QBE by the Review Panel is correct. It is clear from the reasoning of Johnson J, that he neither endorsed nor rejected that part of QBE's submissions. What is not clear is the extent to which that misunderstanding on the part of the Review Panel influenced its decision so that, as GIO submitted, it felt that it could not ignore in its determination of apportionment the effect of the first accident on the psychiatric condition which ultimately developed. 29Were that the only error in the Review Panel's approach I would, as a matter of discretion, not be inclined to intervene because it is not clear whether and to what extent this error influenced or affected the Review Panel's decision as to what permanent impairment was to be attributed to each accident. 30GIO submitted that the Review Panel was required to assess impairment and to determine causation of a psychiatric injury, the symptoms of which first arose after two motor accidents. It submitted that when assessing permanent impairment arising from the second motor accident on 26 November 2007, the Review Panel was required to comply with the guideline dealing with pre-existing impairment, i.e. clause 1.33 of the Permanent Impairment Guidelines. 31GIO submitted that when applying Guideline 1.33 to the second accident, the Review Panel had to take into account its finding that there was no "objective evidence of pre-existing symptomatic permanent impairment" resulting from psychiatric injury at the time of the second accident. GIO submitted that when assessing impairment arising from the second accident on 26 November 2007, in accordance with Guideline 1.33, no account should have been taken by the Review Panel of any possible impairment of a psychiatric nature arising from the first accident on 12 march 2007. GIO submitted that the Review Panel's initial approach at p9.8 of the Certificate was therefore correct, no apportionment was necessary and the 17 percent WPI should have been attributed to the second accident. Not surprisingly, NRMA did not join in that submission. 32As an alternative, GIO joined NRMA in submitting that in determining apportionment between the two motor accidents, it was necessary for the Review Panel to apply Guideline 1.36. They submitted that the Review Panel had misinterpreted Guideline 1.36 and as a result, had determined that the Guideline had no application to either accident. They submitted that the error arose from the Review Panel's interpretation of the words "unrelated injury" as used in the second sentence of the Guideline. 33They submitted that the words "unrelated injury" as used in Guideline 1.36 should be construed as referring to the event causing the subsequent injury, not the medical description of the subsequent injury. 34They justified that interpretation on the following bases: (i) At common law, in workers compensation law and in motor accidents law it has always been recognised that the consequences of an aggravation or exacerbation of a previous injury may be treated as an entirely new, separate and distinct "injury". (ii) The Guideline expressly contemplated that the subsequent injury "results in impairment in the same region", i.e. it affects the same part of the body. That points to an "exacerbation" or "aggravation" of a pre-existing injury in the same body part being an "unrelated injury or condition" to be taken into account under the Guideline. (iii) It avoided what they regarded as the highly unsatisfactory and contradictory result produced by the two Certificates which the Review Panel issued. 35They submitted that the proper application of Guideline 1.36 in respect of the first accident obliged the Review Panel by use of their collective expertise, to make an apportionment in accordance with the Guideline. They submitted that the matter should be referred back to the Review Panel so that it could properly perform the task referred to it. 36Mr Smith submitted that the Review Panel had no alternative but to do what it did, i.e. issue a Certificate in respect of each accident specifying that the major depressive disorder gave rise to a Whole Person Impairment which was greater than 10 percent. He reached that conclusion by the following reasoning: 37The decision by the Review Panel that both accidents had contributed to the Major Depressive Disorder and that the extent of that disorder amounted to 17 percent Whole Person Impairment were factual findings made by an expert panel and were not subject to prerogative review. Guidelines 1.33 and 1.36 could not in their terms apply to the injury. Those Guidelines provided the only power to apportion and if they did not apply, the Review Panel had no power to make an apportionment. In those circumstances, the Review Panel had no alternative but to issue Certificates in the form which they did. In that regard, Mr Smith submitted, the assessment that each motor accident gave rise to a Whole Person Impairment of greater than 10 percent was also a finding of fact, which was not amenable to prerogative relief. 38Mr Smith submitted that while this might reveal a lacuna in the Guidelines in that they do not provide for apportionment in circumstances where two accidents contribute to a psychiatric disability, this did not provide a basis for judicial intervention under s69 of the Supreme Court Act 1970. 39Mr Smith submitted that nothing turned on the interpretation of the words "unrelated injury" in Guideline 1.36. He submitted that even on the interpretation sought by GIO and NRMA, Guideline 1.36 could not apply to bring about an apportionment. 40Mr Smith developed his argument on this issue as follows. If the Review Panel were looking at the first motor accident, the second sentence in Guideline 1.36 would apply to the second motor accident in respect of which there was objective evidence of an unrelated injury resulting in permanent impairment. Guideline 1.36 required the value of that injury to be calculated. What prevented Guideline 1.36 from applying was the requirement in the next sentence that "the permanent impairment resulting from the relevant motor accident should also be calculated", i.e. the first motor accident. 41Mr Smith submitted that such permanent impairment could not be calculated in accordance with Chapter 7 of the Guidelines because of the absence of any objective evidence of symptomatic permanent impairment arising from it. That being so, the deduction of the value of the permanent impairment arising from the subsequent injury from the value of the permanent impairment resulting from the first motor accident, could not be carried out. Implicit in that submission was the proposition that Guideline 1.6 must, of necessity, involve the deduction of the permanent impairment value of the subsequent injury from the permanent impairment value of the injury under consideration. 42The proposition was put in the following terms in oral submissions: " Then if you go back to 1.36, that allows the review panel to take this 17 per cent off the former injury because it's a subsequent injury. So all that 1.36 allows it to do is take this 17 per cent and take it away from the permanent impairment which arose and was calculated in respect of the first accident because it is apportionment for a subsequent injury." (T.4.20) "Now, because the first is incapable of calculation, this provision has absolutely no work to do. It's a mathematical exercise. You take two accidents. The first gave rise to a major depressive disorder .... That gave a permanent impairment rating scale of 25 per cent. The second accident exacerbated that. His symptoms had the effect of, perhaps they were modified and they diminished, nevertheless it gave rise to 17 per cent. They must both be capable of calculation. The work that 1.36 does is take the 25 per cent, take the 17 underneath it, pull it away and say the first one is 8 per cent, second one is 17 per cent. So there you go. That's the way it works. That's the way this provision works." (T.5.17) Consideration 43I agree with the fundamental submission by GIO and NRMA that the issuing of two Certificates by the Review Panel, each of which asserted in relation to the respective motor accidents that the Major Depressive Disorder gave rise to a Whole Person Impairment which is greater than 10 percent, verges on the absurd. Despite the Review Panel trying to explain its decision in the final paragraphs of its reasons, the form of each Certificate on its face is inconsistent with the assessment of the total value of the Whole Person Impairment contributed to by both motor accidents at 17 percent. The apparent absurdity is not saved by seeking to characterise this part of the certificate as a finding of fact and as such immune to prerogative relief. 44As such cases as Morris v George (1977) 2 NSWLR 552 and Bushby v Morris (1980) 1 NSWLR 81 made clear in the context of the Workers Compensation Act 1926, in the absence of any machinery for apportionment of compensation between different insurers the question of apportionment has to be dealt with according to general principles of law and equity. In other words, the decision by the Review Panel to provide two certificates in this form, because they believed the Guidelines did not allow them to otherwise apportion Whole Person Impairment between the two motor accidents, involved an issue of law, not of fact. 45As GIO submitted, the issuing of certificates in this form was not the only option open to the Review Panel. In conformity with its interpretation of Guideline 1.36, and by reference to Guideline 1.33, it could have assessed the second motor accident in accordance with Chapter 7 of the Guidelines while having no regard to any possible impairment of a psychiatric nature arising from the first motor accident. It chose not to follow that approach because of perceived "unfairness", arising from such a result and perhaps because of its erroneous interpretation of the judgment of Johnson J in Ackling v QBE. 46This line of reasoning strengthens my conclusion that the decision to issue certificates in this form was not a factual finding by the Review Panel but raised issues of law. As such, it is subject to review by this Court. Moreover, there is nothing in the Act or Guidelines which raises as a relevant criterion questions of perceived fairness or unfairness by the Review Panel if the Act and/or Guidelines require that a certain result occur. 47It follows that I reject Mr Smith's submission that the finding in the two Certificates that the Major Depressive Disorder caused by each motor accident gave rise to a Whole Person Impairment greater than 10 percent was a factual finding. 48I have concluded that apportionment was possible under the Guidelines, as they presently exist, and based on the factual findings properly made by the Review Panel, i.e. that the two motor accidents contributed to the Major Depressive Disorder and as such, to the total value of the Whole Person Impairment, i.e. 17 percent. 49I have reached that conclusion by adopting the interpretation of Guideline 1.36 submitted by GIO and NRMA. I have concluded that the correct interpretation of the second sentence in Guideline 1.36 is that the words "unrelated injury or condition" refer to the event causing the subsequent injury, not the medical description of the subsequent injury. Unless such an interpretation is given to those words, Guideline 1.36 has little work to do since most injuries resulting in permanent impairment in the same region [as a previous injury] would on the Review Panel's interpretation not be an unrelated injury. 50Support for the interpretation submitted by GIO and NRMA can be found in obiter remarks by Hidden J in Allianz Australia Insurance Ltd v Motor Accidents Authority of NSW & Ors [ 2011] NSWSC 102. That case involved two motor accidents, each of which gave rise to a major depression. The review panel had refused to apportion the permanent impairment between the two motor accidents because the symptoms from the first had not settled when the second motor accident occurred. 51In the course of his judgment, his Honour said: "17 The source of the error, Mr Rewell argued, was that the panel lost sight of the fact that its task was to assess the whole person impairment arising from two accidents. If Mr Cha had claimed only in respect of the first accident, a medical assessor or review panel would have been required to treat the injuries arising from the second accident as "subsequent injuries" within the meaning of clause 1.36. By virtue of that clause, it would have been necessary to determine whether those injuries gave rise to permanent impairment and, if so, to evaluate that impairment. As Mr Rewell put it, an overall assessment of permanent impairment could not have been made if clause 1.36 were correctly applied. Two separate assessments of impairment would have been required. 18 As it was, Mr Rewell said, the panel had before it two claims, each of which had to be dealt with. By clause 1.23, its duty was to assess the permanent impairment occasioned by each accident as at the time of the review. Mr Rewell argued that it was "comfortably in a position" to do so. The evaluation of the impairment arising from the first accident would have to have taken account of that occasioned by the second accident, in accordance with clause 1.36. More importantly from the perspective of Allianz, the evaluation of the impairment arising from the second accident would have to have taken account of that occasioned by the first, in accordance with clause 1.33. ... 23 In response to Mr Rewell's argument that an evaluation of the impairment caused by the first accident would have required consideration of the impairment caused by the second, pursuant to clause 1.36, Mr Romaniuk pointed out that that clause is concerned with evidence of a subsequent and unrelated injury or condition. In the present case, he argued, the condition caused by the second accident was not unrelated because the panel found it to be an exacerbation of the condition arising from the first. However, I think that there is force in Mr Rewell's response that this is not a correct interpretation of the word "unrelated". As an example of a "related" condition, Mr Rewell referred to the common situation where impairment from an accident is increased by subsequent related events, such as medical treatment or surgery. In the present case Mr Cha's condition was exacerbated by a wholly unrelated event, a second accident, so that that exacerbation was relevantly unrelated. 24 That said, whether clause 1.36 would by its terms have been applicable to the evaluation of permanent impairment caused by the first accident is not a matter which I need to decide. ..." 52It then becomes necessary to deal with the additional argument raised by Mr Smith in support of the Review Panel's approach, i.e. that even on the interpretation of the words "unrelated injury" in Guideline 1.36 put forward by GIO and NRMA, it was still not possible for the Review Panel to assess permanent impairment in relation to each motor accident. Implicit in Mr Smith's submission is the proposition that for guideline 1.36 to apply, the value of the subsequent permanent impairment has to be deducted from the value of the permanent impairment arising from the relevant motor accident. 53The first and most obvious difficulty with that argument is that the Guideline does not in terms refer to any deduction. It says no more than that two calculations should be made. 54I have concluded that Guideline 1.36 does not require a deduction in every case as is implicit in Mr Smith's submission. A deduction may well be required if the subsequent "unrelated injury" is an injury which is not brought about by a motor accident. That is not so in circumstances such as we have here where the subsequent permanent impairment is caused by another motor accident. In that case the Guideline requires that the value of each permanent impairment should be calculated. Not only is no deduction required, but it may be inappropriate. 55Another difficulty with this submission by Mr Smith, which was not articulated but which was implicit in it, is that it assumes that the value of the permanent impairment arising from "the relevant motor accident" was to be calculated at or about the time of the occurrence of the second motor accident. As Guideline 1.23 requires, however, the impairment is to evaluated at the time of the assessment. In the circumstances of this case, this is important because the permanent impairment caused by both motor accidents did not develop and become "permanent" until a year or more after the second motor accident. 56Accordingly, the calculation of the value of the permanent impairment arising from the "relevant motor accident" and the value of the permanent impairment resulting from the subsequent motor accident, had to be calculated in accordance with Chapter 7 of the Guidelines at the time of the assessment. That is the very exercise which Hidden J found the Review Panel was required to perform in the Allianz v Motor Accidents Authority case. That is the obligation which Guideline 1.36 imposed on the Review Panel in this case. 57There Hidden J said: "29 The pre-existing condition relevant to the assessment of impairment from the second accident was itself engendered by a motor accident which was also the subject of a claim under the Act. As noted, the Panel was considering two claims, involving different insurers, concurrently. In the event, the Panel made no evaluation of the permanent impairment arising from the first accident, even as at the time of the review. The only basis for this appears to be its finding that the impairment caused by the first accident had not stabilised at the time of the second. As I have said it seems that it was on this basis that it certified that the first accident had not given rise to a whole person impairment greater than 10 percent. 30 Yet, as Mr Rewell rightly emphasised, the Panel found that the condition arising from the first accident had stabilised at the time of the review, and certified accordingly. In other words, as at the time of the review, the condition was permanent within the meaning of clause 1.21. That being so, the Panel could, and should, have assessed the Whole Person Impairment attributable to that accident. It was required to do so not only for the purpose of applying clause 1.33 to its assessment of the impairment caused by the second accident, but also because there was before it a claim in respect of the first. As Mr Rewell pointed out, nothing in the Panel's reasons suggest that the state of the evidence was such that that assessment could not have been made. 31 Clearly, the first accident contributed to Mr Cha's impairment as it was assessed at the time of the review. The Panel found that that accident had caused his depressive condition and that the second accident had exacerbated it. If the Panel had assessed the permanent impairment caused by the first accident, it would have been in a position to apportion the Whole Person Impairment it found between the two accidents. Clause 1.33 (and, if applicable clause 1.36) required it to do so. 32 If the interpretation of clause 1.33 urged by the defendants were correct, the Panel would assess the permanent impairment arising from the first accident but be bound to disregard it when determining the impairment arising from the second. Such a result would be absurd, and it lends force to Mr Rewell's position concerning what he described as the dominant clause, clause 1.23. That clause requires the evaluation of impairment as at the time of assessment, whether that impairment arises directly from the accident in question or is a pre-existing or subsequent impairment within the meaning of clauses 1.33 and 1.36." 58It is not for this Court to speculate on or try to calculate the value of those permanent impairments in accordance with PIRS as set out in Chapter 7 of the Guidelines. That is a matter for expert determination by the Review Panel. As in Allianz v Motor Accidents Authority, there is nothing in the Review Panel's reasons to suggest that the state of the evidence was such that that assessment could not be made. It is the result of that assessment which will determine the form of the Certificates issued by the Review Panel. Conclusion 59I am satisfied that error of law on the face of the record is established and that the orders sought by GIO and NRMA should be made. The errors are clear. The two Certificates issued, to the extent that they assert in the case of each motor accident, that the major depressive disorder caused by it is greater than 10 percent WPI are inconsisent with the Review Panel's assessment of the total WPI caused by both motor accidents. To the extent that the Review Panel took into account concepts of "fairness" and "unfairness" in their interpretation of the Guidelines this was an irrelevant consideration. The extent to which the Review Panel's interpretation of the ratio in Ackling contributed to the conclusion in the Certificates is not clear, but its interpretation of that decision was clearly wrong. Finally, the Review Panel's interpretation of Guideline 1.36 was incorrect which led to a wrongful application of that Guideline. That error played a major part in the Review Panel's reasoning and conclusions. 60In the case of GIO Summons, the orders which I make are as follows: (1) I declare that the Review Panel's Certificate (and Reasons) dated 23 September 2010 issued by a Review Panel appointed by the Second Defendant under s63 of the Motor Accident Compensation Act 1999 is affected by an error of law on the face of the record. (2) I make an order in the nature of certiorari quashing the said Review Panel's Certificate (and Reasons). (3) I order that the matter be remitted to the Second Defendant to be reconsidered by a Review Panel in conformity with the reasons of this Court. 61In relation to the NRMA Summons, I make the following orders: (1) I declare that the Review Panel's Certificate (and Reasons) dated 23 September 2010 issued by a Review Panel appointed by the Second Defendant under s63 of the Motor Accident Compensation Act 1999 is affected by an error of law on the face of the record. (2) I make an order in the nature of certiorari quashing the said Review Panel's Certificate (and Reasons). (3) I order that the matter be remitted to the Second Defendant to be reconsidered by a Review Panel in conformity with the reasons of this Court. 62No submissions were made to the Court as to costs. My current inclination is that costs should follow the event and that Mr Smith should pay the costs of each Summons. I will, however, hear the parties on the question of costs.

GIO GENERAL LIMITED v SMITH & Ors INSURANCE AUSTRALIA LTD T/as NRMA INSURANCE v SMITH & Ors

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