IAG Limited t/as NRMA Insurance v Xie

1. [1]

   By summons filed 7 June 2019, the plaintiff, IAG Limited (“the insurer”), challenges the validity of a decision of a claims assessor, Mr Paul Curtis, of the Motor Accidents Claims and Resolution Service (“CARS”) established within the State Insurance Regulatory Authority of New South Wales (“SIRA”) by s 98 Motor Accidents Compensation Act 1999 (NSW) (“the Act”). The claims assessor refused the insurer’s application for exemption from claims assessment under Ch 4 of the Act to permit the claim to be determined in District Court proceedings. The insurer contends that in making the decision the claims assessor fell into jurisdictional error in various ways or constructively failed to exercise his statutory power in granting the exemption or made an error of law on the face of the record.

2. [2]

   The insurer invokes the Court’s supervisory jurisdiction under s 69 Supreme Court Act 1970 (NSW) and seeks an order in the nature of certiorari setting aside the decision and an order in the nature of mandamus remitting the matter to SIRA for the reallocation of the claim to a different claims assessor for the re-determination of the question of whether the claim is not suitable for assessment under Pt 4.4 of the Act.

3. [3]

   The first defendant, Ms Xie who is the claimant for motor accident damages, contests the insurer’s entitlement to the relief sought. SIRA is the second defendant and the claims assessor is the third. The Crown Solicitors Office has filled a submitted appearance on behalf of both of the second and third defendants.

Background

1. [4]

   Ms Xie was injured in a motor accident on 1 June 2015. She lodged a claim for motor accident damages for personal injury against the insurer with CARS pursuant to Pt 4.4 of the Act. During the claims assessment the insurer made an application under s 92(1)(b) of the Act seeking an exemption from assessment of Ms Xie’s claim by CARS.

2. [5]

   The insurer argued that the claim was “not suitable for assessment” under Pt 4.4 because Ms Xie had made false or misleading statements about the injuries, loss and damage she had sustained as a result of the motor accident and the claim involved complex quantum issues. Ms Xie opposed the application.

3. [6]

   On 23 April 2019 the claims assessor refused the application for exemption on the basis that he was not satisfied that the claim was not suitable for assessment by CARS.

Relevant provisions

1. [7]

   Section 90 of the Act provides that a claim may be referred to the authority by the claimant or the insurer under Pt 4.4. Section 108 of the Act specifies that court proceedings in respect of a claim may only be commenced where an exemption certificate has been issued by the claims assessor in accordance with s 92 or where a claims assessment certificate has been issued.

2. [8]

   Section 92(1) is in the following terms:

3. [9]

   By sections 69 and 106 of the Act the procedures for assessments of claims are governed by the Motor Accidents Claims Assessment Guidelines (“Guidelines”). Relevantly cl 14.16 of the Guidelines sets out a non-exhaustive list of relevant considerations for determining whether a claim is not suitable for assessment and is expressed in the following terms:

4. [10]

   As is apparent from the note at the foot of cl 14.16.11 and from some of the decisions in this Court discussed below concerning the legal limits of the s 92(1)(b) discretionary power, it may be pertinent to contrast the contents of Guideline 14.16 with Guideline 8.11.6 which is in the following terms:

5. [11]

   The question posed by s 92(1)(b) is whether the claim is not suitable for assessment under Pt 4.4 of the Act. The insurer’s contention that the claim was not suitable turned on the considerations identified in cll 14.16.11 and 14.16.5.

The decision of the claims assessor

1. [12]

   In his decision of 23 April 2019 (CB p.45 – 56) the claims assessor rejected the insurer’s argument that Ms Xie’s claim was not suitable for a CARS assessment. The reasons for his decision are as follows:

Submissions of the parties

1. [13]

   Mr M A Robinson SC, who appeared with Dr J Lucy for the insurer, argued that the refusal of the claims assessor to grant the exemption was vitiated by jurisdictional error, error of law on the face of the record or alternatively that the assessor constructively failed to exercise his statutory power in making the decision. He submitted that the assessor misunderstood or misconstrued the scope and nature of his power and incorrectly applied that power to the question before him. He argued that the claims assessor misdirected himself by asking himself whether CARS could deal with the matter as opposed to whether it was not suitable for assessment.

2. [14]

   Mr Robinson further argued that the claims assessor misconstrued the scope and nature of his power by failing to exercise his power in accordance with the statutory scheme. He argued that ss 92(1)(b) and 106 of the Act together with cll 14.16.11 and 8.11.6 evidence an intention that in appropriate cases, such as where there are allegations that the claimant has made false or misleading statements claims are to be tested in a courtroom and exposed to forensic examination. He submitted that the assessor’s disregard for the advantages of the curial process meant that he did not correctly exercise his function in accordance with the Act. He also argued that the claims assessor considered matters which were irrelevant to the determination of the suitability of the claim for assessment, including that: the claimant had incorporated significant documentation in the CARS Form 2A; he expected that the insurer would have conducted investigations into the claimant’s employment; and that it was the claims assessor’s practice to issue a warning to witnesses before oral testimony was taken.

3. [15]

   Mr Robinson submitted that the assessor misdirected himself by having regard to future possibilities or circumstances, such as whether the parties or witnesses would cooperate with the process, as opposed to considering the circumstances at the time of the application. He submitted that the assessor failed to respond to the insurer’s substantial, clearly articulated arguments relying upon established facts, including that the insurer’s exemption application was based on the materiality of the multiple allegations of false and misleading statements, the advantages of the curial process and the complexity of the issues concerning quantum.

4. [16]

   Mr E Romaniuk SC of counsel, who appeared with Ms J Gumbert for Ms Xie, argued that the consideration of the suitability of a claim for assessment was not a more appropriate forum test but rather that s 92(1)(b) required the assessor to be affirmatively satisfied that CARS is not a suitable forum for the particular claim before an exemption could be made. He submitted that the claims assessor had assessed and answered this question correctly. Ultimately, Mr Romaniuk argued that the insurer’s argument was founded on a preference for court proceedings to ventilate the claim as opposed to whether CARS was a suitable forum.

5. [17]

   Mr Romaniuk argued, by provision of a comparison table that the assessor dealt with each of the arguments advanced by the insurer. He further argued that the insurer’s focus on specific words of the assessor’s decision fell afoul of the beneficial reading principle referred to in IAG Ltd t/as NRMA Insurance v Chahoud [2019] NSWSC 767; 89 MVR 87. He submitted that when the decision is read as a whole it is evident that the assessor applied the correct test and that questions of whether a fair hearing could be had in CARS were directly relevant to whether CARS was not the suitable forum.

6. [18]

   Mr Romaniuk submitted that s 92(1)(b) required the decision maker to reach a state of satisfaction and that in such cases, according to QBE v Miller [2013] NSWCA 442; (2013) 67 MVR 322 at [36], judicial review is “limited to determining whether the Proper Officer’s opinion has been properly formed according to law”.

General applicable principles of administrative law

1. [19]

   Before considering the decisions pertaining specifically to s 92(1)(b) I should say something of the applicable law with respect to judicial review. The principles of judicial review of tribunal decisions are established by Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323; [2001] HCA 30 at [82] in the following terms:

2. [20]

   In Dranichnikov v Minister for Immigration and Multicultural Affairs & Indigenous Affairs (2003) 77 ALJR 1088; [2003] HCA 26 Gummow and Callinan JJ said at [24]:

3. [21]

   It is always apposite to consider the beneficial construction principle. In Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259; [1996] HCA 6 at 272 Brennan CJ, Toohey, McHugh and Gummow JJ said that:

Review of previous decisions concerning s 92(1(b) of the Act

1. [22]

   I considered the proper exercise of the s 92(1)(b) discretion in Insurance Australia Ltd t/as NRMA Insurance v Banos [2013] NSWSC 1519; 65 MVR 312. I said that when deciding the statutory question in a case involving allegations that the claimant made false and misleading statements, the following non-exhaustive considerations are relevant (at [43]):

2. [23]

   In Insurance Australia Ltd t/as NRMA Insurance v Taylor [2017] NSWSC 507; 80 MVR 190 Davies J agreed with these matters and added these considerations (at [34]-[39]):

3. [24]

   The considerations of Davies J at [36] were expanded further by Harrison J in IAG Ltd t/as NRMA Insurance v Abiad [2018] NSWSC 1422; 85 MVR 371 at [76], where his Honour said:

4. [25]

   In IAG Limited t/as NRMA Insurance v Khaled & Ors [2019] NSWSC 320 Bellew J emphasised (at [27]):

5. [26]

   To like effect is the decision of Wilson J in IAG Limited t/as NRMA Insurance v Qianxia Lou [2019] NSWSC 382; 88 MVR 57 (at [23]):

6. [27]

   In AAI Limited v Feng [2019] NSWSC 535 Adamson J addressed the question of whether the claims assessor had asked himself the wrong question by considering whether the claim was capable of being the subject of CARS assessment. Her Honour said (at [59]) “Although the ultimate question turns on suitability (or lack thereof), capacity will commonly, if not invariably, be a relevant factor in determining suitability”. Her Honour considered that the use of qualifying words such as “properly determined”, positioned after statements that CARS can or could determine the dispute indicated that the Assessor was addressing suitability rather than credibility.

7. [28]

   Adamson J’s observations were applied by Harrison AsJ in IAG Limited t/as NRMA Insurance v Qin [2020] NSWSC 1025, where her Honour dealt with a claim challenged on substantially the same grounds as the present case. Applying the decision of Adamson J in Feng her Honour said (at [75]):

8. [29]

   In IAG Limited t/as NMRA Insurance v Abdelrazek [2020] NSWSC 773 Adamson J revisited s 92(1)(b). I will set out the relevant parts of her Honour’s reasoning below:

Determination

1. [30]

   It may be said that the decision of Bellew J in Khaled, and Wilson J in Lou demonstrate that a focus upon the capacity of CARS to hear the matter, rather than, or at the expense of, the statutory test of whether the claim is not suitable for assessment under Pt 4.4 may invalidate the claims assessor’s s 92(1)(b) determination for jurisdictional error. It may be sufficient to say that the error is one of misdirection by identifying a wrong issue or asking the wrong question. At the same time, bearing in mind the applicability of the beneficial construction approach, provided it is clear that the claims assessor has formulated the question for determination as whether the claim is not suitable for assessment under Pt 4.4 of the Act, as Adamson J said in both Feng and Abdelrazek, the capacity of CARS to provide both parties with a fair hearing “will commonly, if not invariably, be a relevant factor in determining suitability” Feng at [59].

2. [31]

   Likewise, as Wilson J said in Lou, focusing upon whether issues involving an allegation of false and misleading statements by a claimant “were commonly dealt with, and, thus could be dealt with” in an assessment, if that consideration was treated as decisive, may too indicate that the claims assessor had asked the wrong question; but not inevitably so. As Adamson J pointed out in Abdelrazek (at [57]), a claims assessor is “entitled to envisage the way in which the assessment would be conducted”. In making this assessment it is open to the claims assessor to draw on the past experience of CARS dealing with like cases in order to assess whether the case at hand could be dealt with fairly as a consideration relevant to, but not necessarily decisive of, whether the claim was not suitable for assessment.

3. [32]

   The question posed by s 92(1)(b) requires the claims assessor to make a decision about the choice of forum for a particular claim in circumstances where claims generally are dealt with by assessment under Pt 4.4 of the Act. However, as Mr Romaniuk argued the statute does not create a “more appropriate forum test” or even a “clearly inappropriate forum” test: Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538; [1990] HCA 55. These concepts from private international law need not be introduced into this area of discourse. The statutory test focusses on the assessment process and whether it is not suitable for the claim at hand. The question is not whether court processes are more suitable for the particular claim. As I said in Banos an important part of the context in which the question arises is that “the Act contemplates that the great majority of disputes would be resolved by the assessment process and not in court”. To my mind this is why the syntax adopted by the legislative drafter casts the central concept in the negative, as not suitable.

4. [33]

   As Adamson J said in Abdelrazek, provided the statutory test is borne firmly in mind, the decision as to what factors are relevant and what weight is to be given to each of them are matters for the judgment of the claims assessor.

5. [34]

   Taking the claims assessor’s reasons as set out above at [12] as a whole and reading them fairly, I am positively satisfied that the claims assessor addressed the statutory test in express terms at the commencement and conclusion of the critical part of his reasoning. There is nothing to suggest he was diverted from this path by impermissible or extraneous considerations. He did not focus on capacity at the expense of suitability, nor did he elevate deductions drawn from his experience of the assessment process to a level where they can be seen to have trumped, or unseated, the statutory question of non-suitability.

6. [35]

   I am not satisfied that the Claims Assessor failed to deal with the insurer’s argument under Guideline 14.16.5, which is concerned with the complexity of the issues going to the assessment of damages (see [9] above). Frankly it must seriously be doubted whether the issues sought to be raised by the insurer, as a matter of law, rose to this level. Again as demonstrated by Adamson J in Abdelrazek, issues of this type legitimately raised by the insurer were not self-evidently “complex”. The claims assessor in the course of his reasons by necessary implication assessed this factor at [69] – [76]. The insurer has not shown that the claims assessor’s approach fell outside the legal bounds of his power.

7. [36]

   For these reasons I am not persuaded that the insurer has established jurisdictional error, a constructive failure to exercise jurisdiction, or error of law on the face of the record, so far as this last category may have been argued seperately.

8. [37]

   My orders are:

   1. (1)

      Summons dismissed;

   2. (2)

      The plaintiff to pay the first defendants costs.