First issue
14I turn now to the first issue, which I described earlier. Has the driver in this case given a "full and satisfactory explanation for not having given notice within the three month period"? Mr Turnbull acknowledges that the explanation is full. I agree. The affidavits relied upon by the driver seemed to give a fulsome and transparent account of why the notice was not served in time. But Mr Turnbull says that although full, the explanation is not satisfactory.
15I will at this stage return to the Court of Appeal judgment in Staggs which is a source of authority and guidance for me. In Staggs at 319 ([48]), Basten JA, with whom Giles JA agreed, appeared to approve of the proposition that the "explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant would have failed to have complied with the duty or would have been justified in experiencing the same delay." On the same page at [50], his Honour referred to the third party insurer at that case and said this -
"It is an institutional litigant which, in the absence of evidence to the contrary, should be assumed to be in the position to make informed decisions as to steps to be taken in protecting its interests in litigation. Unlike an accident victim, who is likely to be uninformed about the technical requirements of legislation and is almost wholly reliant on solicitors for advice and timely compliance with legislative requirements, an insurer will generally be knowledgeable as to the legislation and will have a close relationship with solicitors who act for it on a regular basis".
At 320 ([51 - 53]) Basten JA referred to three factors to take into account in "assessing any explanation given for the purposes of s 36(5)". His Honour proceeded as follows:
"First, a decision to join the Nominal Defendant, as opposed to the commencement of proceedings against the Nominal Defendant by a plaintiff, is subject to strict time limits. Thus, the period of three months from the date of receipt of a claim is undoubtedly a short period. That is no doubt because Ch 2 of the Motor Accidents Compensation Act is concerned with third party insurance, which is compulsory: joinder by a party seeking contribution or indemnity will be the responsibility of a compulsory third party insurer, which may be understood to have the resources and ability to act promptly when the relevant occasion arises."
The second factor referred to by his Honour is the one I referred to above about the notice "merely foreshadows an application for joinder". In describing the third factor, his Honour said this:
"Thirdly, although the notice does not need to include 'full details of the allegations made against the Nominal Defendant', the insurer considering whether to give such notice will be conscious that such details must be provided within two months after the notice is given, a period which is non-extendable."
I also respectfully accord weight to what Hodgson JA said at 310 ([4]):
"It follows in my opinion that generally an insurer that receives a claim under s 72:
(1) should promptly consider and decide whether it wishes to investigate the possibility of a claim against the Nominal Defendant; and
(2) if the decision is to investigate this possibility, should act so as if possible to be in a position, within the three month period, to make a decision whether to give notice and, if the decision is to give notice, to give that notice."
16The driver in this case has put on evidence of a lot of activity by his insurer to investigate the accident. The insurer acted with commendable promptness; but Mr Turnbull argues that there were three basic inadequacies in that prompt investigation which mean that the explanation is not satisfactory.
17The first claimed inadequacy is that there was no early freedom of information request of the police to overcome their failure to volunteer information because of an ongoing police investigation. But such a request was made on 26 November 2012 and the information was limited. I am confident a timely request would have been no more successful.
18The second claimed inadequacy is that three of the notices of claim which the driver received from the four plaintiffs all included a diagram, each very similar, which suggested that there were two cars involved in the accident, not just one. I say "suggested" because Ms Kumar argued - correctly, I think - that the diagrams could be interpreted as illustrating one car only, but in successive positions. Ms Kumar also pointed out that the form posed the question "How many motor vehicles were involved in the accident?" to which the answer given by the plaintiffs was "1".
19Ms Kumar tendered evidence from a Claims Consultant at NRMA Insurance who said that in her experience "the picture is of little assistance in understanding what happened in the accident and I focus on the description and answers to the questions." That appears in [4] of exhibit F, the affidavit of Louise Kerkham sworn 31 January 2014. With commendable frankness Ms Kerkham went on to say the following at [8] -
"Before 19 November 2012, I did not suspect the involvement of an unidentified vehicle because I didn't have regard to the sketch/picture in the claim form and chose to wait for the investigation to be returned before making any conclusions. In my view, even if I had placed more weight on that picture in May and June 2012, my actions would have remained the same, namely I would have briefed the investigator to investigate the circumstances of the accident as the picture does not provide proof for an application to join the nominal defendant."
20Ms Kumar argued that the investigation promptly ordered by Ms Kerkham was the action of a reasonable person in her position, who had also not followed up the diagrams.
21Mr Turnbull argues, on the other hand, that NRMA Insurance, as a third party insurer, is an institutional, knowledgable, informed, and experienced litigant who would have followed up on the two-car possibility raised by the diagrams. I think Mr Turnbull is right. A compulsory third party insurer should always be alert to the possibility of another insurer sharing liability. That is not only an obligation but a perspective which is in its own commercial interests. Circumstances pointing to the Nominal Defendant are one example.
22The insurer will be aware of time constraints. I think Ms Kerkham, in saying that she looked for "proof for an application to join the Nominal Defendant", puts the test, at that stage, too high. As Basten JA said, it is a foreshadowing of a joinder. The joinder may not occur. The insurer has three years to decide whether or not to join the Nominal Defendant, but only three months to decide whether or not to issue a notice. There is, in my opinion, no time to wait to see if proof emerges. Any possibility must be investigated.
23As Ms Kumar said, her client acted very promptly in placing the matter into the investigator's hands, but in my opinion the investigator should have been alerted to the possibility of there being more than one car.
24They may have undertaken a door knock in the vicinity at the time of their original instructions. Also, as Mr Turnbull argues, another option was for the insurers to phone the plaintiff's solicitors, who were named in the form, to ask them about the diagrammatic reference to a second car.
25Mr Turnbull's third argued inadequacy is that NRMA Insurance made no attempt to speak to the driver, who became its insured. There is an explanation for this. It makes a lot of sense. Not only was the driver legally a "child", that is, he was under 18, but he was charged by the police with a serious crime. It is understandable that NRMA Insurance may not have regarded it as appropriate to send around a professional investigator to interview a minor about the circumstances giving rise to the police charging him with an indictable offence. That is a legitimate point of view.
26But another point of view is that the insurer has rights and obligations under its insurance contract. Even though the minor was not a party to the contract, he was covered by it. The insurer was faced with a series of claims that it would be solely liable for. There was a suggestion, the diagrams, that someone else should share that liability. That suggestion enlivened its statutory obligations, including time limits. Obviously, the interests of the potential co-defendant become a factor. Provisions in the statute are designed to protect the interests of the Nominal Defendant. It seems to me, in those circumstances, that the contractual or statutory rights, liabilities and obligations of the insurer and a potential third party should have outweighed the considerations about approaching the insured minor.
27At least the insured minor could have been asked at an early stage. Perhaps a parent could have been approached. It would need to be done carefully and with due regard to the minor's rights not to incriminate himself and to obtain advice. But, in my opinion, Mr Turnbull is right to argue that the attempt should have been made. I accept Mr Turnbull's argument that in those two respects - following up the diagram and the insured minor driver - the driver has not provided a satisfactory explanation for not having given notice within the three-month period.
28It follows that joinder of the Nominal Defendant, required to be effected in accordance with the section, cannot be effected. I would refuse order 1 sought in the summonses.