Paice v Hill

29 By s 94(1), once a claim was referred for assessment, a claims assessor (defined by s88(1) as an officer of the Authority in CARS) was required to assess liability for the claim (unless the insurer accepted liability) and the amount of damages for that liability. 30 By s 95(1) an assessment of the issue of liability for a claim was not binding on any party to the assessment. By s 95(2) an assessment of the amount of damages was binding on the insurer. 31 Section 92 provided: "92 Claims exempt from assessment (1) A claim is exempt from assessment under this Part if: (a) the claim is of a kind that is exempt under MAA Claims Assessment Guidelines or the regulations, or (b) a claims assessor has made a preliminary assessment of the claim and has determined (with the approval of the Principal Claims Assessor) that it is not suitable for assessment under this Part.

(2) If a claim is exempt from assessment under this Part, the Principal Claims Assessor must, as soon as practicable, issue the insurer and claimant with a certificate to that effect (enabling court proceedings to be commenced in respect of the claim concerned)." 32 Section 96 provided: "96 Special assessments of certain disputes in connection with claims (1) This section applies to a dispute between a claimant and an insurer as to: (a) whether a late claim may be made in accordance with section 73, or (b) whether the claimant has a satisfactory explanation for non-compliance with section 70, or (c) whether a claim may be rejected for non-compliance with section 74, or (d) whether the insurer is entitled to delay the making of an offer of settlement under section 82 on the ground that any particulars about the claim are insufficient, or (e) whether a payment is required to be made under section 83 (not being a medical dispute that may be referred to a medical assessor under Part 3.4). (2) Any such dispute may be referred at any time to the Authority by the claimant or the insurer, or both, for assessment under this Part. (3) Any such dispute is to be referred to a claims assessor, the dispute is to be assessed and a certificate is to be issued by the claims assessor in accordance with the relevant provisions of this Division relating to the assessment of claims. Division 3 applies to the assessment of the dispute in the same way as it applies to the assessment of a claim. (4) An assessment of a dispute under this section is binding on the parties to the dispute to the extent that it relates to the duties of the parties with respect to the claim under Part 4.3." 33 Section 108 provided: " 108 Claims assessment or exemption pre-condition for commencement of court proceedings (1) A claimant is not entitled to commence court proceedings against another person in respect of a claim unless: (a) the Principal Claims Assessor has issued a certificate in respect of the claim under section 92 (Claims exempt from assessment), or (b) a claims assessor has issued a certificate in respect of the claim under section 94 (Assessment of claims).

(2) The provisions of this section are in addition to those of section 109. Accordingly, both sections are capable of applying to a claim." 34 I have previously set out part of s 109 but, for convenience, I shall set out the relevant parts of the section in full. These are: "109 Time limitations on commencement of court proceedings (1) A claimant is not entitled to commence proceedings in respect of a claim more than 3 years after: (a) the date of the motor accident to which the claim relates, or (b) if the claim is made in respect of the death of a person - the date of death, except with the leave of the court in which the proceedings are to be taken.

(2) Time does not run for the purposes of this section from the time that a claim has been referred to a claims assessor for assessment and until 2 months after a certificate as to the assessment or exemption from assessment is issued.

(3) The leave of the court must not be granted unless: (a) the claimant provides a full and satisfactory explanation to the court for the delay, and (b) the total damages of all kinds likely to be awarded to the claimant if the claim succeeds are not less than 25% of the maximum amount that may be awarded for non-economic loss under section 134 as at the date of the relevant motor accident."

The issue of construction as regards the first excluded period 35 I reiterate that the first excluded period runs from the date on which CARS received the plaintiff's application for an assessment under s 96(1) of a dispute concerning the question whether the plaintiff had made a full and satisfactory explanation for the delay in making her claim. It expires two months after the date that an assessor certified that the plaintiff could make a late claim in accordance with s 73. 36 Essentially, the difference between the plaintiff and the defendant as regards the first excluded period is that the defendant contends that time was suspended under s 109 only when a claim was referred for assessment under s 94, while the plaintiff contends that time was also suspended when a claim was referred for assessment under s 96. It is the effect on s 109(2) of assessments under s 96 that is the nub of the issue. This is relevant to the first excluded period as the period in question is a period during which the assessor was making an assessment under s 96. The question that arises is one of construction.

The linguistic argument 37 The defendant contrasts s 96 (which dealt with assessments of disputes) with s 94 (which dealt with assessments of claims). 38 The disputes with which s 96(1) was concerned were whether a late claim could be made in accordance with s73, whether a claimant had a satisfactory explanation for non-compliance with s 70 (a section concerned with the reporting of motor accidents to the police), whether a claim could be rejected for non-compliance with s74 (a section concerned with the form of the notice of claim), whether the insurer was entitled to delay the making of an offer of settlement under s 82 on the ground that any particulars about the claim were insufficient, and whether an insurer was required to make hospital, medical and other payments under s 83. 39 Section 94 concerned only assessments made "in respect of a claim referred to the assessor for assessment". Section 3 defined a "claim" as "a claim for damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle." By s 94, the assessor was required to assess the issues of liability and damages arising in claims referred for assessment. 40 Thus, while s 94 involved the assessment of the basic elements of claims, s 96 involved the assessment of disputes (in regard to claims) that were essentially procedural in nature. Disputes under s 96 would ordinarily arise before any assessment under s 94 of liability or damages. 41 Under s 109(2), time did not run for the purposes of s 109 from the time that "a claim" was referred for assessment. This provision is significant in the present context as s 94 concerned (as s 94(1) provided) only "a claim referred for assessment". Section 96, on the other hand, concerned "disputes," only. Thus the language of the three sections prima facie tends to support the defendant's argument (as s 109(2) concerns claims - as does s 94 - while s 96 concerns disputes).

The provisions relating to exemption from assessment 42 Section 109(2) refers expressly to the issuing of "a certificate as to the assessment or exemption from assessment". It does so in the context of providing that time does not run for the purposes of s 109 from the time that a claim has been referred to a claims assessor for assessment until two months after such a certificate has been issued.

43 By s 92(1)(b), read with s 92(2), a certificate of exemption could be issued if a claims assessor made a preliminary assessment of the claim and determined (with the approval of the Principal Claims Assessor) that it was not suitable for assessment. By s 92(1)(b), therefore, a certificate for exemption of assessment could only be issued after a claims assessor had made a preliminary assessment of the claim. For a claims assessor to make such a preliminary assessment, a claim had to be referred for general assessment under s 94. Thus, a certificate of exemption could only be issued after a claim had been referred for general assessment under s 94. 44 I repeat that suspension of time occurred under s 109(2) from the time a claim had been referred for assessment until two months after a certificate as to the assessment or exemption from assessment was issued. The fact that the referral of a claim for general assessment under s 94 (and not s 96) was a precondition to the issuing of a certificate of exemption supports an inference that the "assessment" under s 109(2) was required to be an assessment under that section (and not under s 96). 45 I would add that a general assessment under s 94 would be far more appropriate for carrying out a preliminary assessment of a claim with a view to considering whether a certificate of exemption from assessment should be issued than an assessment of a limited issue of the kind that would give rise to a dispute under s 96.

The headings to s 94 and s 96 46 Section 94 was headed "Assessment of claims" in contradistinction to s 96, which was headed "Special assessments of certain disputes in connection with claims". Thus, the headings, if reference may be made to them, lend further support to the defendant's argument. 47 The use of headings in interpreting the MACA is limited by s 35 of the Interpretation Act 1987 read with s 34. The effect of these sections is that headings to sections may only be used in ascertaining the meaning of legislative provisions if the provisions are "ambiguous or obscure". For the reasons I have already given, there is an ambiguity in the MACA as to whether an assessment under s 96 causes time to stop running under s 109(2). Thus, in my opinion, regard may be had to the headings of sections 94 and 96 in resolving that ambiguity. The headings support the defendant's argument.

The unfairness argument 48 Garling DCJ's principal basis for upholding the plaintiff's argument in regard to the first excluded period was as follows: "If the defendant's argument is correct, then it would require a plaintiff or a claimant to commence their action within three years after the motor vehicle accident, however, where they have given late notice of the claim, they cannot commence the action until they comply with s 96. Providing there is a dispute; I take it the parties can always agree there is no dispute, that where there is a dispute could not commence it until a decision had been made pursuant to s 96. They are then in a position where they have got to commence a claim within three years but they cannot commence it until that decision is made and there is no stay of the proceedings or stay of the time for commencement. That would mean that a plaintiff would have to make an application pursuant to s 96 at such a time that they were confident that it would be determined prior to the limitation period running out. It can be seen from this case that that could take some time. The difference in this case is … quite a significant period. … I believe that the correct interpretation and the way it was meant to be interpreted, pursuant to s 109 is to include assessments under s96 in assessments pursuant to 109(2) and therefore the time ceases to run between the date of the application and the period of two months after the certificate has been issued. That would mean that the plaintiff then had until 12 February 2008 to commence the action." 49 Underlying his Honour's reasoning is the notion that the construction advanced by the defendant would lead to potential unfairness. He said, in effect, that a claimant required to make a late claim (that is, a claim made more than six months after the motor vehicle accident) could not commence court proceedings until he or she had made an application for an assessment under s 96 and that application had been resolved. His Honour had in mind, as I understand what he said, that such a resolution was dependent on the conduct of others and the claimant might be kept waiting without being entitled to commence proceedings in court and while time continued to run against him or her. This, his Honour implicitly considered, would be unfair. 50 At the outset I would note that there is nothing in the MACA that provides that an action cannot be commenced until there has been compliance with s 96. His Honour's view that a claimant had to comply with s 96 before commencing court proceedings was erroneous and infected his general approach. The relevant section is s 108, which provides that a claimant may not commence court proceedings in respect of a claim unless an exemption certificate has been issued under s 92 or a claims assessor has issued a certificate under s 94. 51 Mr Stone, of counsel, who acted for the plaintiff, submitted that, nevertheless, his Honour - practically speaking - was correct in his view of the effect of s 96. Initially, Mr Stone gave the example of a claimant who had given late notice of her claim (such as the plaintiff). He submitted that such a claimant could not commence action until s 96 had been complied with. He supported this proposition in the following way. He submitted: (a) Section 73(1) provided that a late claim could only be made if the claimant provided the insurer with a full and satisfactory explanation for the delay. (b) If the insurer refused to agree that a full and satisfactory explanation had been made, a claim could not be made. (c) Relying on the argument that, without a full and satisfactory explanation for the delay, a claim had not been made, the insurer could refuse to admit or deny liability for the claim under s 81(1). (d) Relying on the same argument, the insurer could deny that it had any obligation under s 82 to make a reasonable offer of settlement (that is, because the insurer could contend that a claim had not yet been made). (e) In these circumstances, the claimant would not be able to refer the claim for assessment, as (subject to the exceptions contained in s 91(2)) the time periods laid down by s 91(1) would not have commenced. (f) As a claim could not be then referred for assessment, s 108(1) would have the effect that the claimant would not be entitled to commence court proceedings in respect of the claim. The only practical step a claimant could take would be to apply under s 96 for an assessment of the dispute that had arisen as to whether a full and satisfactory explanation had been given. 52 Mr Stone accepted that, eventually, the claimant might get the certificate, but in waiting for this to occur the three-year limitation period under s 109 might expire. Were that to happen, the claimant would be faced with the obstacles provided by s 109(3) in attempting to obtain leave to commence proceedings on a late claim. 53 There is a basic flaw in this scenario. In my opinion, an insurer would not be entitled to avoid its duty to make an offer of settlement under s 82 on the basis that a full and satisfactory explanation for the delay had not been provided. Under s 82, the duty of an insurer to make a reasonable offer of settlement arose within one month after the injury had stabilised (s 82(1)(a)) or within two months after the claimant had provided the insurer all relevant particulars about the claim (s82(1)(b)). The duty of an insurer under s 82 was not predicated on the existence of a claim that was not a late claim or on the provision of a full and satisfactory explanation for any delay in making a claim. 54 Mr Stone, indeed, later accepted (correctly, in my view) that it would always be open to a claimant to cause time under s 109 to be suspended by making a general application for an assessment of the claim under s 94 (that would be irrespective of whether the dispute concerning the provision of a full and satisfactory explanation for the delay had been resolved). 55 I accept, nevertheless, that a claimant might experience difficulties if an insurer disputed that the claimant had provided all relevant particulars about the claim (as s 82(1)(b) requires). Assessments under s 96(1)(d) - as to whether the insurer is entitled to delay the making of an offer of settlement under s 82 on the ground that any particulars about the claim are insufficient - were binding on the parties: Hayek v Trujillo [2007] NSWCA 139 at [47]. This is to be contrasted with an assessment of a dispute as to whether a full and satisfactory explanation for making a late claim has been given. Such an assessment was not binding on the parties: Hayek v Trujillo at [48]. 56 Mr Stone submitted that it would be unfair if a claimant, who had made a late claim, could only cause time under s 109 to be suspended by making an application under s 94 for an assessment of the claim. Mr Stone submitted, by reference to the prescribed form by which claimants are required to make applications under s 94, that the costs involved in complying with the requirements of the form were large and onerous. He submitted that due compliance with the form required much labour and caused much inconvenience. 57 The statutory scheme under the MACA, as I noted in Hayek v Trujillo at [59], is one "whereby all claims, save those that are specifically held to be exempt from assessment under s 92, are to be assessed under s 94 before court proceedings can be commenced." The requirement to provide detailed particulars when an assessment under s 94 is made is an important element of that scheme. Thus, while Mr Stone's submissions concerning costs, labour and inconvenience may be accepted, it should also be accepted that the scheme of the MACA involves deliberate "front-end loading" of preparation and costs (as it was put by Mr King SC, who appeared for the defendant) with the view to promoting settlement of claims before court proceedings are commenced, and in ensuring that all non-exempted claims are assessed under s 94 before court proceedings are commenced. 58 In other words, the difficulties to which Mr Stone referred are merely part of the inducements the legislative scheme provided by the MACA offers to parties to have their cases resolved in accordance with the CARS assessment system and not by way of court proceedings. Accordingly, those difficulties do not support Mr Stone's argument. 59 I would add that a number of the difficulties to which Mr Stone adverted stem from provisions of guidelines (the "Guidelines") the Authority issued pursuant to s 69(1) of the MACA. That section provided that "the Authority may issue guidelines for or with respect to procedures for the assessment of claims under Part 4.4 and associated matters". Part 4.4 concerned claims assessment and resolution and comprised ss 88 to 106. Section 106(1) provided that "claims assessments under [Part 4.4] are subject to relevant provisions of [the Guidelines] relating to those assessments". In other words, as Mr Stone accepted, the Guidelines operate by force of law as if they are delegated legislation. 60 The provisions of the Guidelines cannot be used to construe the MACA itself. 61 In my opinion, no significant weight attaches to the opportunities that, according to Mr Stone, the MACA provided to insurers to act in an obstructive way in cases where a claimant fails, in terms of s 72, to make a claim timeously. In the first place, the claimant can avoid that situation by making the claim in good time. I would infer from the MACA as a whole that this is precisely the conduct on the part of claimants that the MACA wishes to induce and encourage. In the second place, save for the possible instance where the claimant has not provided the insurer with all relevant particulars about the claim, the claimant would be able to stop time running (despite any obstructive tactics on the part of the insurer) by making an application for an assessment under s 94. For the reasons I have given, I do not accept that the costs and inconvenience in making a s 94 general application negate the relevance of the existence of the right to make such an application to the construction exercise required. 62 It must not be forgotten that s 109(1) allows for leave to commence proceedings more than three years after the date of the motor accident. The grant of leave is constrained by s 109(3), including that the likely damages are more than a certain amount. But that is part of the encouragement of timely conduct on the part of claimants, and further represents the legislature's view that a claimant who does not act in a timely manner should, if the likely damages are not great, be unable to commence proceedings if the three years has expired.

The objects of the MACA 63 Mr Stone submits that the argument advanced by the plaintiff is consistent with the following objects of the Act: (a) The provision of compensation for compensable injuries sustained in motor accidents (s 5(1)(b)). (b) The encouragement of the early resolution of compensation claims (s 5(1)(b)). 64 Mr Stone also drew attention to the acknowledgement in s 5(2)(a) that participants in the legislative scheme provided by the MACA have kept the overall costs of the scheme within reasonable bounds so as to keep premiums affordable. He submitted that the plaintiff's argument is consistent with that aim. 65 For the following reasons, I do not think the objects in question afford the defendant any material assistance. 66 The construction of s 109 advanced by the defendant would encourage the early resolution of claims. On that construction, the pressure on claimants to bring their claims timeously would be increased. This is obviously an aim of the legislation. 67 The need to do the necessary investigations at an early stage (and not, as used to be the practice, shortly before the trial) is a basic feature of the scheme of the MACA. Underlying that feature is the belief that costs would be reduced if claims were to be resolved by settlement before the commencement of court proceedings, rather than thereafter. This approach is fundamentally inconsistent with Mr Stone's submission that it would be desirable (and fair) for applications under s 96 to have the effect of suspending the running of time under s 109 so as to avoid the need of claimants to make applications for assessments under s 94 (and to provide full details of their claims as required for s 94 assessments). 68 Accordingly, I do not think that the matters relied on by the plaintiff in relation to the objects of the MACA have cogency. 69 Mr Stone submitted that, on a purposive construction, the plaintiff's argument should be upheld. His argument in this respect, in effect, was the same as that which he put in regard to the objects of the MACA. In my view those arguments lack persuasion for the same reasons that I have given when dealing with the plaintiff's reliance on the objects of the legislation. 70 Mr Stone pointed to the fact that the claimant does not have control over the timing of the s 96 process. Essentially, he said that, if time was dragging on in regard to a s 96 assessment, the only way that claimants could protect their rights would be by making an application for an assessment under s 94. He again submitted that this procedure would often be undesirable and inappropriate because of the costs involved. This raises the same issues that I have dealt with above. I do not consider the submission to be persuasive. 71 Mr Stone submitted that the MACA should not be construed so as to detract from a claimant's common law rights. In my opinion, however, this argument carries little weight in regard to the MACA which is a specific code for dealing with claims arising out of motor accidents and which, by its very nature, involves fundamental changes to the common law rights of the parties involved. 72 In conclusion, in all the circumstances, I consider that the defendant's argument is correct. The application that the plaintiff made under s 96 for the assessment of the dispute as to whether she gave a full and satisfactory explanation for the delay in making her claim was not an assessment under s 109(2) and did not suspend time running under that section.

The second excluded period 73 As I have noted, the issue involved with the second excluded period is whether the running of time under s 109(2) was suspended during the period from 29 January 2008 to 7 March 2008. I reiterate that on 29 January 2008 the plaintiff applied for exemption from assessment (as part of her application for an assessment under s 94) by posting to the Authority an application that was incomplete. The plaintiff remedied her defective application on 7 March 2008 by sending a fresh and complete application to the Authority. 74 Garling DCJ dealt with this point relatively briefly. His Honour described the plaintiff's argument as being that she was required to forward her application to the Authority, and once this had been done, "time ceases to run until a decision is made". His Honour said in regard to this argument: "I believe that this is the correct interpretation. To have it any other way would once again make the whole procedure almost impossible to deal with because it would all depend on the Authority being satisfied that the application was one made to their satisfaction." 75 It is common ground that Chapter 8 of the Guidelines governed the form of an application for an assessment under s 94. Chapter 8 provides: "8.1 An application … by either party for general assessment must: 8.1.1 be in the form approved by the Authority and 8.1.2 set out or be accompanied by the particulars and information required by that form." 76 The form actually sent by the plaintiff on 29 January 2008 when she applied for her assessment was not placed before this Court. However, it appears from other evidence that certain documents listed in the form laid down by the Guidelines were not provided to the Authority. When, on 7 March 2008, the plaintiff submitted a fresh application for assessment under s 94, the requisite material was attached to the form. It comprised three medical reports, a statement by the plaintiff, a schedule of damages and written submissions. 77 Mr Stone submitted that the plaintiff did not, initially, provide the information required by the form as she was seeking a certificate of exemption. Mr Stone explained that she wished to avoid the expense involved in supplying the material required for a full-scale s 94 assessment. 78 The fact remains that, by failing to provide any of the material laid down by the form (which was a form approved by the Authority in terms of Chapter 8 of the Guidelines), she failed to comply with Chapter 8 and her failure was substantial. The requirement in the Guidelines for the material in question to be attached to the form is consistent with the legislative scheme that requires claimants to provide relevant information at an early stage and before court proceedings are commenced. 79 It is not necessary to decide whether any failure to comply with the requisite form would constitute a contravention of Chapter 8 of the Guidelines. It is sufficient to state that, as Studdert J said in Budge v Kimmorley (NSWSC, 28 June 1991, unreported) when dealing with an omission of material from a form specified for use under the Motor Accidents Act 1988: "At the very least there must be the provision of information that places the insurer in a position which enables it to discharge its statutory duty … there must at the very least be information sufficient to enable the insurer to properly assess the claim." 80 In my opinion, information of the kind described by Studdert J was not contained in the plaintiff's 29 January 2008 application for an assessment under s 94. The plaintiff thereby breached Chapter 8 of the Guidelines and, in consequence, the 29 January 2008 application was invalid. 81 It would not be consistent with the objects of the MACA if were Chapter 8 to be construed as meaning that a failure to comply with its requirements in the manner described by Studdert J did not result in invalidity of the application. On that construction, a claimant could cause time to be suspended simply by submitting a totally incomplete form to the Authority. That would be fundamentally inconsistent with the objects of the legislation. 82 I would therefore accept the defendant's argument that the form sent by the plaintiff on 29 January 2008 was a nullity.

(a) The application for leave to appeal is granted.

(c) The orders made by Garling DCJ are set aside. (d) The action brought by the plaintiff in the District Court in proceedings no. 2494 of 2008 is dismissed with costs, including the costs of the motion dated 30 September 2008. (e) The plaintiff to pay the defendant's costs of the application for leave to appeal and the appeal. (f) The plaintiff to be granted a certificate under the Suitors' Fund Act 1951 if otherwise entitled. **********

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