Insurance Australia Limited t/as NRMA Insurance v Asaner

judgment

1. The plaintiff (insurer) seeks an order in the nature of certiorari, setting aside the legal effect of a decision of the proper officer of the State Insurance Regulatory Authority made on 28 August 2015, refusing an application for further assessment of a medical dispute under s 62(1A) Motor Accidents Compensation Act 1999 (NSW) ("the Act"). The first defendant, Hakan Asaner, is claiming damages for personal injuries received in a motor accident on 14th of July 2012. On that day he was loading his work van with a bread tray when he was struck by an oncoming motor car. He claimed injuries to various parts of his body including his neck and lower back.

Previous medical assessment

1. There was a dispute about whether Mr Asaner's degree of whole person impairment as a result of injury caused by the motor accident was greater than 10 per cent for the purpose of s 131 of the Act so as to entitle him to damages for non-economic loss. Relevantly, for present purposes that dispute had been resolved by a medical assessment undertaken by Dr David Johnson on 9th of March 2015. In his certificate of 12th March 2015, the medical assessor assessed the degree of permanent impairment at 14 per cent.
2. Dr Johnson's 14 per cent assessment had three components: five per cent impairment of the cervical-thoracic spine (DRE 2); an additional four per cent for a consequential restriction of left shoulder movement related to the cervical-thoracic spinal impairment (UEI: 7 per cent); and five per cent impairment of the lumbo-sacral spine (DRE 2). Dr Johnson recorded a history given by Mr Asaner of restriction of left shoulder motion due to neck pain and difficulty working above shoulder level. On examination he found mild restriction of range of motion of the left shoulder due to neck pain. In making his assessment he relied upon Nguyen v Motor Accidents Authority of New South Wales [2011] NSWSC 351 by Hall J. Other alleged injuries either gave rise to no assessable impairment or were unrelated to the motor accident.
3. Among the volume of medical material provided to Dr Johnson for the purpose of his assessment was a report of Dr Phillipa Harvey-Sutton dated 13 December 2013 to which Dr Johnson made reference a number of times in his reasons. At page 23 of his reasons he recorded that Dr Harvey-Sutton received a history of immediate pain in the neck and left shoulder and recorded inconsistent demonstrations of the range of movement of the left shoulder particularly when comparing "formal to informal" examination. Because of this inconsistency she did not assess permanent impairment of the left shoulder. Dr Johnson found on his examination: "Mr Asaner was fully co-operative and made a good effort following examination of the shoulders. It was my opinion that the restricted range of motion in the left shoulder was due to neck pain." It should be recorded that his findings in relation to shoulder movement on both sides are recorded at page 13 of his reasons. The restricted range of motion of the left shoulder was established by use of a goniometer.

Application for further assessment rejected

1. On 30th June 2015 the insurer applied for the matter to be referred again for medical assessment under s 62 of the Act on the ground of "additional relevant information about the injury" (s 62(1)(a)). An application for referral again under s 62 is made to a member of staff of the authority referred to as "the proper officer of the Authority". The matter is not to be referred again "unless the … additional information is such as to be capable of having a material effect on the outcome of the previous assessment:" s 62 (1A).
2. The additional relevant information identified by the insurer was a surveillance DVD dated 12th May 2015 (the footage was obtained on 24th April 2015), the investigator's report dated 8th May 2015 including a surveillance log, and a second report of Dr Harvey-Sutton dated 11th June 2015, all post-dating Dr Johnson's assessment certificate.
3. In her second report, Dr Harvey-Sutton said that she had viewed and considered the surveillance report and DVD footage which "leads [her] to confirm [her] conclusion in [her] principal report" inter alia, that she could not "identify continuing signs of injury or disability".
4. The proper officer's decision was made on 28th August 2015, and explained in a 4 page letter addressed to the insurer containing his reasons. It was expressed in the following terms: "I have determined that the application will not be referred for further assessment. This is because I am not satisfied that the additional relevant information or deterioration of the injury is such as to be capable of having a material effect on the outcome of the previous assessment as required by s 62(1A) of the Motor Accidents Act 1999." The proper officer's reasons identified the proffered additional information and record the insurer's submissions in the following terms: "The applicant submits that the surveillance dated 24th April 2015 (at 10.07 a.m.) shows the claimant with a free and full [range of movement] of his left shoulder and unrestricted neck movement, which is noted by Dr Harvey-Sutton in her report dated 24th April 2015. The [insurer] points to the conclusion made in the report that as a result of reviewing the documentation before her, Dr Harvey-Sutton could not identify continuing signs of injury or disability." I interpolate that Dr Harvey-Sutton did not express the view that the surveillance showed a free and full range of movement of the left shoulder and unrestricted neck movement. Her impressions were recorded in the terms I have set out above.
5. Having set out his understanding of the applicable law, under the heading "Reasons" the proper officer explained his decision in the following terms: "I am satisfied that the surveillance material and Dr Harvey-Sutton's report are additional to the party relying on them as a ground for further assessment, as required by Singh. However, I am not satisfied that they constitute additional relevant information about the injury. This is because Dr Harvey-Sutton's opinion does not appear to be of a different kind (i.e. dealing with different issues) than the opinions already expressed and considered as outlined in Singh. In this case, Dr Harvey-Sutton has commented, as noted by the applicant, that the evidence (being the surveillance material) supported her original assessment of the claimant's whole person impairment in relation the left shoulder. This is clearly recorded on page 3 of her report In which she states 'my opinion has not changed'. I note that Dr Harvey-Sutton's previous opinion was before the Assessor and was considered. As her opinion has not changed, I do not consider it to be additional relevant information. In light of Dr Harvey-Sutton's comments above that the surveillance material does not affect her previous determination, and in the absence of any material before me to the contrary, I am not satisfied that the surveillance material is additional relevant information. This is because it does not contain an opinion of a different kind as required by Singh, and is saying the same thing but using different or greater analysis, as outlined in Alavanja. I note the respondent's comments about the timing for the surveillance to have taken place, It is not appropriate for me to comment on perceived appropriateness or otherwise in behaviour by the parties. In any event, as I have found that the surveillance material and the report of Dr Harvey-Sutton are not additional relevant information, I need not comment further. As mentioned earlier, Section 62(1A) contains two parts to the test. The first is to ascertain whether there is additional relevant information or deterioration. The second deals with materiality. The second test is reliant on the first test having been met. As I have found that information contained in the application is not additional relevant information, it is not necessary or possible for me to apply the second test of Section 62(1A) and determine whether it is such as to be capable of having a material effect on the outcome of the previous assessment."
6. The case-law references are to Singh v Motor Accidents Authority of New South Wales (No 2) [2010] NSWSC 1443, and Alavanja v NRMA Insurance Limited [2010] NSWSC 1182. I record that in Jubb v Insurance Australia Limited [2016] NSWCA 153, decided after the case at hand was argued before me, the Court of Appeal (Gleeson JA at [74]; Meagher and Payne JJA agreeing), observed the reasoning in Singh "must be treated with some caution". Moreover, in Jubb the correctness of the "same issues" limitation on the meaning of "additional information" was "doubted" (at [80] - [81]). However, the Court found it unnecessary to consider the correctness of other first instance decisions following Singh (No 2) including Alavanja. I discuss Jubb in more detail later in these reasons.

The submissions of the parties

1. The insurer argued that the decision of the proper officer was vitiated by a number of errors. The first error was a misconstruction of the expression "additional relevant information". It was argued that the proper officer misdirected himself by assuming that new evidence supporting previously expressed conclusion could never be additional relevant information. The erroneous principle applied was said to be derived from Alavanja and Singh (No 2).
2. The second error was based on an argument that the proper officer had failed to personally view the DVD. Reliance was placed upon the decision in Insurance Australia Limited v Clewley [2015] NSWSC 1805 at [32] - [34] to the effect that an opinion formed without viewing the DVD was not one properly formed according to law. The same matter involved the proper officer in a breach of clause 14.5.1 of the Motor Accident Medical Assessment Guidelines (Version 4) requiring the proper officer to "have regard to" the application. The guideline was said to be a mandatory relevant consideration.
3. The third alleged error was evaluating the materiality of the surveillance material through the prism of Dr Harvey-Sutton's second report only. Again, it was submitted that the proper officer was required to view it for himself and consider whether, standing alone, it was capable of changing the outcome of the previous assessment. I was invited to view the DVD for myself when considering this argument.
4. Mr Asaner argued that in substance the insurer was impermissibly challenging the merits, rather than the legality, of the decision: Attorney-General (NSW) v Quin [1990] HCA 21; 170 CLR 1, 35-36. It was submitted that the proper officer had directed himself correctly in accordance with decisions of the Court in Garcia v Motor Accidents Authority of New South Wales [2009] NSWSC 1056; Alavanja at [43]; and Henderson v QBE Australia Limited [2013] NSWSC 480; 67 MVR 69 at [104] - [105]. It was said that there was no error in the proper officer considering the materiality of the surveillance material in the light of Dr Harvey-Sutton's second report. Even if I were satisfied that the proper officer had not viewed the film itself, there is no error in him failing to do so.
5. The insurer joined issue in each of these matters.

Supplementary submissions of the parties

1. As Jubb was handed down following the hearing of this matter, I granted leave to the parties to file supplementary submissions in respect of that decision. Counsel for the plaintiff argue that Jubb makes clear that the proper officer erred by relying upon Singh (No 2) and Alavanja when directing himself as to the legal content of his power to refer again. The proper officer heavily relied upon this line of authority, such that he was "distracted… from the true nature" of the power which fatally infected his decision.
2. Counsel for Mr Asaner tacitly accept that the import of Jubb is that the proper officer's reliance on Singh (No 2) and Alavanja was not correct. They argue, however, that such error is not material to the final decision, and therefore not an error of law. The proper officer's decision was nonetheless a decision that was open to him in the correct exercise of the residual discretion as articulated in Jubb at [36]. While he misconstrued the phrase "additional relevant information", the proper officer's findings of fact in respect of Dr Harvey-Sutton's second report and the surveillance still stand, unaffected by error; and that even with the correct application of s 62, had these questions been considered at the point of the exercise of the discretion rather than when considering the operation of s 62(1)(a), the same decision would have been made. They further caution that the remarks in Jubb, particularly at [76]­ - [80], about the capacity of further medico-legal reports to constitute additional relevant information were obiter dicta, and that the principle in Henderson still holds the field; that is, that what informs the question of whether further medical opinion satisfies the precondition is whether the basis for the new opinion is additional relevant information which, Counsel submit, is not the case here.

Decision

1. It is clearly established that the "characterisation of the information", relevantly in the present case, as additional relevant information "is a matter to be considered in the first instance by the proper officer and not one to be determined by [the] court fresh on a judicial review application": QBE Insurance (Australia) Limited v Miller [2013] NSWCA 442; 67 MVR 322 at [36]. The Court's powers "are limited to determining whether the proper officer's opinion has been properly formed according to law": Miller at [36]; Buck v Bavone [1976] HCA 24; 135 CLR 110 at 118 - 119.
2. Given these limitations on the court's supervisory jurisdiction, I am not satisfied, at least in the circumstances of this case, that it is appropriate for me to view and consider the content of the surveillance DVD and its possible significance. To do so would be to indulge in merits review. I am not empowered to correct wrong findings of fact nor is this a case where it is submitted that the statutory test contained in s 62 (1A) is satisfied as a matter of law because no other decision is reasonably open: Hope v Bathurst City Council [1980] HCA 16; 144 CLR 1 at 8, as Clewey apparently was.
3. I am not satisfied that the proper officer did not view the DVD for himself. He commenced his reasons by stating that he had considered the application for further assessment, the reply, and all supporting documentation submitted in these matters. From page 2 of his reasons, he is clearly aware that the surveillance DVD, report and investigator's log are all part of the propounded additional information. "Documentation" where used by the proper officer should be given its ordinary meaning in a legal context of extending to digital means of recording information including DVDs. He held that the material was additional information (page 3); he must have considered it to so conclude. The basis of his decision adverse to the insurer was his view that that material did not constitute additional relevant material about the injury. His reasons provide no basis, in my view, for inferring that the proper officer failed to view the DVD.
4. Having made that finding, I wish to record my view that it may not be necessary in every case for the proper officer to view a DVD to make his or her own independent decision whether to refer the dispute for a further medical assessment. For example, the question whether the "additional" information is such as to be capable of having a material effect on the outcome of the previous assessment" will usually raise medical issues. As the question of degree of impairment is a medical one determined by a medically qualified assessor, a party's application for referral again may be expected to be supported by medical opinion explaining how the additional information enjoys the statutory capacity to change the outcome of the previous assessment. Except, as I have said, in what is likely to be, rare cases where the capacity to change the outcome of the previous assessment is self-evident from a consideration of the lay material itself a proper officer may permissibly form the view that what the doctor says of the surveillance is more significant to the task than his or her own necessarily lay impression.
5. The gravamen of the proper officer's decision is that he was not satisfied that the additional information was relevant. Essentially this was because Dr Harvey-Sutton, relied upon by the insurer to explain the significance of the surveillance material, treated it as being merely confirmatory of her previous views which were before Dr Johnson, and not accepted by him to the extent to which her findings on examination differed from his. The proper officer made it clear in coming to that conclusion he was purporting to apply Singh (No 2) and to some extent Alavanja. As the surveillance material was merely confirmatory of an opinion with which the medical assessor did not agree, the proper officer decided it, like the second report of Dr Harvey-Sutton, was not additional relevant information. I repeat the following from his reasons: "This is because it does not contain an opinion of a different kind as required by Singh, and is saying the same thing but using different or greater analysis, as outlined in Alavanja." In these circumstances the proper officer did not find it necessary to go on to consider whether the information is such as to be capable of having a material effect on the outcome of the previous assessment. Nor it might be said did separately address the exercise of the s 62(1) discretion.
6. With respect, the proper officer's reasons for deciding the surveillance material was not additional relevant information are expressed in language which is a little difficult are to follow. But he seems to have thought himself constrained by authority to interpret the phrase "additional relevant information" as restricted to "opinions" dealing with "issues" not previously considered.
7. Considered in the light of the recent decision of the Court of Appeal in Jubb the proper officer's opinion has not been formed according to law. I am satisfied that the insurer has established constructive failure to exercise jurisdiction, a form of jurisdictional error.
8. In Jubb the Court of Appeal rejected a proposed construction of s 62 which read down the phrase "additional relevant information" as "excluding information concerning issues which have already been considered by the previous medical assessor" (Jubb at [55]; [59] - [65] per Gleeson JA; Meagher and Payne JJA agreeing). The proper officer's error consists of having adopted the construction rejected by the Court of Appeal.
9. Moreover, although not expressly overruled, the reasoning in Singh (No 2) was subjected to rigorous critical analysis (see [74] - [80]). As Singh (No 2) proceeded on the now recognised as erroneous basis that the s 62(1A) pre-condition was a jurisdictional fact of a type to be determined by the Court as an objective fact, the reasoning had to be treated "with some caution". Rodger v De Gelder [2011] NSWCA 97; 80 NSWLR 594, QBE Insurance (Australia) Limited v Miller [2013] NSWCA 442; 67 MVR 322, and Henderson v QBE Insurance (Australia) Limited [2013] NSWCA 480; 66 MVR 69 are authority for the proposition that the s 62(1A) pre-condition is not a jurisdictional fact of that type. The proposition that material held back by a party was not additional information is "open to doubt" because of "a risk of conflating the considerations to be balanced by the proper officer in exercise of the discretion given in s 62(1) and the formation of the proper officer's opinion required by s 62(1A)." The proposition that a further medical opinion "cannot constitute" "additional information" "unless it is based upon a change in the claimant's underlying symptoms and circumstances … may be doubted" because it tends to conflate the separate grounds of "deterioration of the injury" and "additional relevant information". That "conflation" seems to have occurred here. At the beginning and end of his reasons the proper officer coupled the statutory alternatives as though they were one. I accept that the explanation may be, simply, that he adhered too faithfully to the language of the statute. On the whole he appears to have understood that the ground relied on by the insurer was the receipt of "additional relevant information about the injury": s 62 (1)(a).
10. The phrase "additional relevant information" is to be given its ordinary meaning. It encompasses much more than the mere expression of expert opinion even if, as I have said already, relevance or significance for the purpose of s 62(1A) might, as a matter of fact, depend upon an expert exposition. So much is made clear by Meagher JA in Henderson (at [106]; Tobias AJA agreeing). "What the circumstances of this case emphasise is the need, in relation to such applications, to specify clearly the additional information about the injury which is said to be capable of having a material effect on the outcome of any earlier assessment. In some cases the fact of a medical opinion may be, or be part of, the relevant additional information. In the present case, however, the information which was capable of having a material effect on the outcome of the earlier assessment was not the fact that the revised opinions were held but that the underlying symptoms or assumptions by reference to which those opinions were expressed were said to have changed." I accept that Mr Asaner's supplementary submission accurately summarises the effect of this decision. Although it would be wrong to assume that a revised medical opinion alone can never constitute additional relevant information. A different but cogent medical view not available at the time of the previous assessment is one example that comes to mind as capable of satisfying the test.
11. I am not persuaded that the proper officer's reliance on the construction he derived from Singh (No 2) was not material to his decision. I am of the view that the error not only contributed to his decision but was central to it. His "decision might have been different by reason of the possibility that [he] would not have made the [same] findings fact" but for the error: Australian Broadcasting Tribunal v Bond [1990] HCA 33; 170 CLR 321 at 353. That properly directed the same decision may be open is not to the point.
12. In light of the recent decision in Jubb, it perhaps helpful to provide practical guidance as to its application by way of an outline the correct legal approach referrable to the circumstances of this case.
13. Contrary to his decision, there is nothing in law which precluded the proper officer from evaluating Dr Harvey-Sutton's second report as "additional relevant information". I am not suggesting that the law mandated that decision. Only that in law that decision was open. Dr Harvey-Sutton stated that what was seen on the surveillance material was confirmatory of the opinion she had previously expressed. The insurer argued that the surveillance material depicted Mr Asaner exhibiting a full range of left shoulder movement. If that submission was borne out by his viewing of the film, it was legally open to the proper officer to decide that Dr Harvey-Sutton's restatement of her previously held opinion considered in the light of the surveillance material was additional relevant information.
14. Were that the decision, the question was then whether the proper officer was satisfied that that "additional information is such as to be capable of having a material effect on the outcome of the previous assessment". As Dr Johnson's assessment depended in no small part upon what he regarded as the objective determination of a limited range of movement in Mr Asaner's left shoulder secondary to his neck injury, an affirmative answer to that second question would also have been open. It is relevant (not mandatory) in this context to consider that upon assessment range of shoulder movement is objectively determined by use of clinical apparatus, not by informal lay impression.
15. If the proper officer in his subjective assessment decided each of those questions in favour of the insurer, a third question arises which is "whether or not to refer the matter for a further assessment" in the exercise of the "residual discretion" conferred by s 62(1) by use of the word "may": Jubb at [32] - [36]. Of the "residual discretion" Gleeson JA said (at [36]): "… the discretion is not entirely unconstrained. The power conferred on the proper officer must be exercised in accordance with the subject matter, scope and purpose of the statute…[T]he existence of that discretion has been recognised in the authorities on s 62." [Citations omitted]. Questions like whether a party has "held back" information, or whether the additional relevant information is new, or whether like information is shown to have been considered and rejected in the previous assessment, or whether by the exercise of reasonable forensic diligence the information could have been obtained in a timely way for the purposes of the previous assessment are matters which may inform the exercise of the residual discretion: Jubb at [77] - [80]. The examples I have provided cannot, and are not intended to, be exhaustive.
16. My orders are: 1. Set aside the decision of the third defendant made on 28th August 2015 refusing the plaintiff's application for referral for further medical assessment under s 62(1)(a) of the Motor Accidents Compensation Act 1999 (NSW); 2. Remit the matter to the second defendant for the determination of the application by its proper officer according to law; 3. The first defendant is to pay the plaintiff's costs.

Amendments 22 August 2016 - Name change: to [No. 2] 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 August 2016