Lithgow v Insurance Australia Ltd trading as NRMA Insurance

By amended summons filed on 27 July 2017 Susan Lithgow (the plaintiff) sought orders pursuant to s 69 of the Supreme Court Act 1970 (NSW) in respect of the following decisions:

The orders sought in the amended summons are:

Unless otherwise stated all references to legislative provisions in these reasons are references to the Motor Accidents Compensation Act 1999 (NSW) (the Act).

Rule 59.10 of the Uniform Civil Procedure Rules 2005 (NSW) (UCPR) provides that proceedings for judicial review must be commenced within 3 months of the date of the decision. Notwithstanding the form of the summons, in substance the plaintiff complains only about two matters: the referral by SIRA to Dr Ryan on 12 January 2017 and the certificate given by Dr Ryan on 7 February 2017. These proceedings were commenced by the filing of a summons on 11 April 2017. In these circumstances, I regard the proceedings as having been brought within time. Accordingly, the plaintiff does not require an extension of time.

I propose at the outset to summarise the legislative framework.

SIRA is a State government agency which administers the compulsory third party insurance and compensation scheme under ss 62 and 63 of the Act. The "proper officer" of SIRA is an employee designated as such under the Act pursuant to s 62(1B). Proper officers are authorised under the Act to make decisions concerning whether a medical assessment should be referred to medical assessors in SIRA’s Medical Assessment Service (MAS).

Part 3.4 of the Act relevantly provides:

A person, who is otherwise entitled to damages under the Act, is not entitled to damages for non-economic loss unless the degree of permanent impairment is greater than 10%: s 131. Where there is a disagreement about the degree of permanent impairment suffered, the Court may not award damages for non-economic loss unless the degree of permanent impairment has been assessed by an assessor, who conducts an assessment of the degree of permanent impairment in accordance with s 133: s 132.

Section 133 relevantly provides:

As referred to above, where there is a disagreement between the claimant and the insurer as to “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%”, Part 3.4 of the Act applies: s 58(1)(d).

The plaintiff claimed damages against Insurance Australia Ltd t/as NRMA Insurance, the first defendant (the NRMA), for injuries, including an injury to her lumbar spine, which she alleged were sustained in the course of a motor accident on 19 March 2012. The NRMA is the compulsory third party insurer of the vehicle at fault in the subject motor accident and has admitted liability.

On 12 July 2014, the plaintiff underwent a single level (L5/S1) spinal fusion. At the time the surgery was not the subject of a “treatment dispute” as to whether it was “reasonable and necessary” within the meaning of s 58(1)(a) or whether it related to the injuries sustained in the motor accident under s 58(1)(b) as the plaintiff did not claim the cost of the surgery from the NRMA.

On 8 October 2015 Dr Bodel carried out a medico-legal assessment of the plaintiff. He opined that the plaintiff had a “disc rupture at the lumbosacral junction caused by the motor vehicle accident”. He assessed the plaintiff as having a whole person permanent impairment (WPI) of 22%.

Subsequently a dispute arose under s 58(1)(d) as to whether the degree of WPI that was a result of the injury caused by the motor accident was greater than 10%. On 30 November 2015 the plaintiff applied to the MAS to be assessed for permanent impairment by lodging a MAS Form 2A.

On 19 April 2016, the plaintiff was assessed by a SIRA medical assessor, Dr Kenna, pursuant to ss 58(1)(d), 60, 61, and 133 to determine any permanent impairment. Dr Kenna concluded that the plaintiff’s lumbar spine injury was caused by the accident and that the plaintiff’s resultant WPI was 22%. In his MAS certificate dated 6 May 2016, Dr Kenna listed the injuries to be assessed as follows:

Dr Kenna certified that the plaintiff had suffered from a number of injuries caused by the motor accident, including:

This finding in Dr Kenna’s certificate is significant for reasons which will appear below.

On 16 May 2016 a combined certificate was issued in respect of the plaintiff in which Medical Assessor Kathryn Williamson certified that the plaintiff’s combined permanent impairment was 22%.

On 28 June 2016 the NRMA lodged an application for review of a medical assessment (MAS Form 5A). It relied on pre-accident complaints of back pain made by the plaintiff to her general practitioner as well as the report dated 18 March 2013 of Dr Harvey-Sutton who opined that the plaintiff did not require surgery as a result of the injuries sustained in the motor accident. On 9 August 2016 the Proper Officer issued a statement of reasons for the following determination:

By application dated 13 September 2016, the NRMA lodged an application for further assessment of a permanent impairment dispute by the MAS (Form 4API). It appears from the wording of the application that it was made pursuant to s 62(1)(a) on the grounds of “additional relevant information about the injury”. The ground specified in the form for the application was:

In support of its application, the NRMA relied on the reports of Dr Harvey-Sutton dated 27 June 2016 and 26 August 2016 in which she reiterated her opinion that the plaintiff did not require surgery as a result of the injuries sustained in the motor accident. The NRMA also relied on two medical certificates from 2006 which had not been available earlier which recorded prior complaints of back pain by the plaintiff.

On 20 October 2016, the team leader for the Proper Officer wrote a letter to the parties informing them that the Proper Officer proposed to accept the application for further medical assessment as an application for assessment of a treatment dispute and invited the parties to make submissions on the proposal. Because of the significance of the letter to the proceedings it will be set out in full:

The NRMA said, in its response, dated 1 November 2016, which it forwarded to the plaintiff’s solicitors on the same day:

On 18 November 2016, the plaintiff, in her response to the request for submissions from the Proper Officer's representative proposing the matter to proceed to a treatment dispute, agreed that a treatment dispute existed and that the matter should be referred for assessment as a treatment dispute. The plaintiff said further:

By letter dated 12 December 2016, SIRA (by letter signed by Ms Brinkworth for the Proper Officer) informed the parties as follows:

By letter dated 12 January 2017 the Proper Officer wrote to the parties, acknowledging the correspondence that the parties had sent and said:

Both parties made submissions, including on the question “whether the treatment provided or to be provided to the injured person relates to the injury caused by the motor accident”. The treatment dispute was then assessed by the fourth defendant who certified, on 7 February 2017:

The plaintiff challenged the decisions referred to above on the following six grounds:

Mr Austin, who appeared for the plaintiff, confirmed that the plaintiff contended, in respect of each error alleged in grounds 1-6, that the error was jurisdictional and did not contend that any error was an error of law on the face of the record. In summary, the plaintiff’s challenge turned on a narrow point. Mr Austin argued that SIRA acted outside its jurisdiction when it purported to refer a medical dispute to an assessor for medical assessment in circumstances where, although the plaintiff had made a claim for the treatment associated with her back surgery in an amount in the order of $40,000, the material before SIRA did not establish that the plaintiff had made any such claim.

On the morning of the hearing, the plaintiff sought to amend her summons further to add the three grounds relating to the certificate itself. Mr Robinson SC, who appeared with Ms Gumbert for the defendant, did not oppose the amendment. The additional three grounds are:

In respect of these three grounds, I understood Mr Austin to rely on both jurisdictional error and error of law on the face of the record.

As the plaintiff has made submissions on grounds 1-6 together, it is convenient to summarise her submissions in a global way. The plaintiff contended that there was no medical dispute relating to treatment and no medical assessment matter capable of being referred for medical assessment because SIRA did not have before it a claim by the plaintiff for medical treatment, although, in fact, such claim had been made. She also contended that the Proper Officer’s satisfaction that there was a medical dispute or medical assessment matter capable of being referred for medical assessment was “a jurisdictional fact which was the precondition for referral” and that the conclusion in the present case was “not properly formed according to law”. As the plaintiff confined her challenge to jurisdictional error, I understood her to contend that it was not open to SIRA to refer the matter for medical assessment.

As appears from the plaintiff’s amended summons, she seeks orders in respect of three decisions: the first being SIRA’s decision (by the Proper Officer) on 20 October 2016; the second being SIRA’s decision (by the Proper Officer) made on 12 December 2016 and/or 12 January 2017 to refer the NRMA’s application to a medical assessor; and the third being the medical assessment certificate of Dr Ryan dated 7 February 2017 (the 2017 Certificate).

This Court’s jurisdiction to grant relief under s 69 of the Supreme Court Act depends on the plaintiff’s establishing an error of law on the face of the record or a jurisdictional error. As referred to above, the plaintiff relies solely on jurisdictional error. In order to address the plaintiff’s submissions, it is necessary to analyse what occurred in order to determine whether what was done fell within the provisions of the Act.

As referred to above, the NRMA applied for a further assessment under s 62(1)(a) following the issue of the certificate by Dr Kenna. SIRA proposed, in its letter dated 20 October 2016, that the NRMA’s application be treated as a medical dispute under s 60 in relation to the matters in s 58(1)(a) and (b), which had not previously been referred for assessment. By its letter dated 1 November 2016, the NRMA acceded to that suggestion. Accordingly, the letter of 1 November 2016 had the effect of a referral to SIRA pursuant to s 60, there being a dispute as to whether the treatment (the back surgery) related to the injury caused by the motor accident; and whether the treatment (back surgery) provided to the injured person was reasonable and necessary in the circumstances.

By letter dated 18 November 2016 the plaintiff accepted the correctness of the Proper Officer’s decision of 20 October 2016 to reject the NRMA’s application as an application for further assessment under s 62(1)(a). She accepted the suggestion that the question whether the back surgery was reasonable and necessary (s 58(1)(a)) ought be referred for assessment but contended that the s 58(1)(b) point (whether the surgery related to the injuries sustained in the accident) ought not be referred as it had already been determined. After further correspondence, SIRA referred the medical dispute about both matters to Dr Ryan on 12 January 2017, as it was obliged by s 60(2) to do, a medical dispute having been referred to it by a party to the dispute, in this case, the NRMA.

I do not discern anything in Pt 3.4 or elsewhere in the Act which would warrant a gloss being applied to the words of s 60, or indeed the definition of “medical dispute” in s 57, to require treatment to be the subject of a claim for treatment expenses, much less that SIRA must have the claim documentation before it can be the subject of a medical dispute. Mr Austin was unable to point to any statutory wording to support his contention. I regard the structure and purpose of Pt 3.4 which are addressed in more detail below, as being inconsistent with any such requirement.

Moreover, Mr Austin’s submission is contrary to Scott v Insurance Australia Ltd t/a NRMA Insurance [2015] NSWSC 1249; (2015) 72 MVR 300 (Scott), in which the primary judge, Campbell J, was not persuaded that ss 58 and 60 were limited to circumstances where a specific request for payment for treatment had been made ([84]). In that case, the relevant claim was a claim for future care. On appeal, in Insurance Australia Ltd t/as NRMA Insurance v Scott (2016) 92 NSWLR 741; [2016] NSWCA 138 (Scott CA), Ward JA considered (Basten and Gleeson JJA agreeing) that the existence of a medical dispute was not a jurisdictional fact in the sense that the matter was to be finally determined by the court ([116] and [121]). Her Honour considered at [118] that:

Mr Austin’s submission gains no support from the provisions of Pt 3.4 to which I will now turn. The matters which may be referred for medical assessment are the three matters referred to in s 58: namely, whether treatment was or is reasonable and necessary (s 58(1)(a)); whether any such treatment relates to the injury caused by the motor accident (s 58(1)(b)); and whether the degree of permanent impairment as a result of the injury caused by the motor accident is greater than 10% (s 58(1)(d)). A “medical dispute” is defined by s 57 as a disagreement or issue to which Pt 3.4 applies. It can be seen from the medical assessment matters listed in s 58(1) that there is a potential for overlap between the questions whether particular treatment relates to the injury caused by the motor accident (s 58(1)(b)) and whether the degree of permanent impairment as a result of the injury caused by the motor accident is greater than 10% (s 58(1)(d)). The present case is an example of that overlap in that back surgery may give rise to restriction of movement which, if related to an injury caused by the motor accident, is germane to the assessment of WPI. In the normal course it might be expected that the question whether particular treatment relates to the injury caused by the motor accident would be determined before an assessment of WPI. However, in the present case that did not occur since the plaintiff, at the time, made no claim for the cost of the surgery from the NRMA. Accordingly, no issue arose before the assessment of WPI as to whether the surgery related to the injury sustained in the motor accident or whether it was reasonable and necessary in the circumstances.

As long as it was open to SIRA to consider that there was a medical dispute, being a disagreement about a matter under Pt 3.4, SIRA was obliged under s 60(2) to refer it for medical assessment. There was plainly such a dispute in the present case as to the causal connection between the surgery and the back injury sustained in the accident and whether the surgery was reasonable and necessary. In these circumstances, SIRA was obliged to refer it. None of grounds 1-6 has been made out.

I note for completeness that s 60 does not, in terms, require any decision. It does not confer any role on the proper officer. Unlike ss 62 and 63, the proper officer does not play any “gateway” function. The authorities concerning ss 62 and 63 caution that the gate-keeper function performed by the proper officer when making a determination, such as on an application for a review of a medical assessment to a review panel (s 63), ought rarely be the subject of judicial review: Dominice v Allianz Australia Insurance Ltd [2017] NSWCA 171 at [5], [7] and [10] (Basten JA). Having regard to the differences between s 60 on the one hand and ss 62 and 63 on the other, judicial intervention in relation to a referral under s 60 is even less likely to be warranted than under ss 62 or 63.

Nonetheless, as Basten JA said in Dominice v Allianz Australia Insurance Ltd, an analysis needs to be undertaken to ascertain the effect of the decision or conduct sought to be impugned in order to determine whether a party’s rights have been ultimately affected. For example, in the present case, the insurer accepted that if SIRA had refused to refer the medical dispute for assessment, it would arguably have been open to the NRMA to seek relief under s 69 of the Supreme Court Act to require SIRA to refer the medical dispute, as s 60(2) imposes a statutory obligation on SIRA to refer medical disputes for assessment. However, a referral by SIRA, of itself, has no discernible effect on the plaintiff’s rights and accordingly, any error would generally not entitle the plaintiff to relief: Hot Holdings Pty Ltd v Creasy (1996) 185 CLR 149; [1996] HCA 44 at 159 (Brennan CJ, Gaudron and Gummow JJ).

In Scott CA Basten JA said at [7]-[9], of the referral for medical assessment under Pt 3.4:

As can be seen from the provisions extracted above, following the assessment by an assessor of a medical dispute, the assessor is to “give a certificate as to the matters referred for assessment” (s 61(1)). The certificate as to a “medical assessment matter” is conclusive evidence in any court proceedings or in any assessment by a claims assessor (s 61(2)). It does not, however, bind other medical assessors, although it would generally be taken into account. Accordingly, when Dr Ryan assessed the medical dispute that had been referred to him, he was not obliged to accept Dr Kenna’s findings of causation but was obliged to make his own assessment, based on the material before him, which included Dr Kenna’s certificate and reasons.

Grounds 7, 8 and 9 can be dealt with together because they overlap and each turns on the way in which Dr Ryan approached his task. Mr Austin contended that Dr Ryan had “failed to engage” with the plaintiff’s “case” when he performed his assessment because he had failed to identify the “injury” and failed to address the inconsistency between Dr Kenna’s finding of causation and Dr Ryan’s own finding. He accepted that Dr Ryan had found that the plaintiff complained of back pain after the motor accident but made no aetiological diagnosis. Although he accepted that Dr Kenna’s certificate and reasons appeared on the list of material which Dr Ryan had considered, he contended that Dr Ryan was obliged to set out his reasoning process in the reasons for the certificate to show that he had actively engaged in a process of consideration and reasoning.

In his reasons for the certificate of 7 February 2017 Dr Ryan narrated the medical history of the plaintiff before and after the accident. He confirmed the plaintiffs pre-existing back symptoms and noted the pre-accident CT Scan of lumbar spine dated 28 August 2009. Dr Ryan recorded that the plaintiff stated that after the motor accident she developed low back pain. He stated that he considered the MAS application and supporting documents as well as the MAS reply form and supporting documents. Dr Ryan was not obliged to agree with either Dr Bodel or Dr Kenna. His reasons reveal that he made his own assessment based on the examination he conducted of the plaintiff and the history obtained from her as well as his consideration of the documents before him. He did so in the context of the task he was required to perform: to assess if the need for surgery was caused by the accident and if the surgery was reasonable and necessary. This was the correct approach: Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [47], [55] and [56] (French CJ, Crennan, Bell, Gageler and Keane JJ).

On the question of causation, Dr Ryan noted the plaintiff’s history that the surgery had made no difference to her symptomology and concluded that prior to the accident the plaintiff "already had significant pathology in her low back and at times disabling symptoms", and therefore the surgery was not causally related to the injury. I consider that Dr Ryan adequately set out his “path of reasoning”, as required. The plaintiff has not identified any mandatory relevant consideration to which Dr Ryan has been shown not to have had regard.

The plaintiff has failed to make out any of grounds 7-9.

The parties accepted that costs ought follow the event.

For the reasons set out above, I make the following orders: