Insurance Australia Ltd v Marsh

BASTEN JA: In August 2012 the respondent, Robert Marsh, was involved in a motor vehicle accident. There was a dispute as to whether certain aspects of treatment proposed for Mr Marsh were causally related to an injury sustained in the accident and as to whether there were reasonable and necessary in relation to an injury sustained in the accident.

Under the Motor Accidents Compensation Act 1999 (NSW) (“the Act”), as in force when the claim was made, such matters were dealt with by the Medical Assessment Service which was part of the State Insurance Regulatory Authority. In December 2019 the treatment disputes were referred for assessment by a medical assessor, Dr Philip Truskett. On 5 February 2020 the assessor issued two certificates, both of which were unfavourable to Mr Marsh (hereafter “the claimant”).

The Act provides for review of a medical assessment by a medical review panel. An application for referral to a panel may be made on the ground that the assessment “was incorrect in a material respect”: s 63(2). However, the application will only be referred to a panel if “the proper officer of the Authority is satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect having regard to the particulars set out in the application”: s 63(3).

On 4 March 2020 the claimant’s solicitor lodged an application for review of the medical assessment, under s 63(1) of the Act. The proper officer, not being satisfied as to the statutory criterion, on 11 May 2020, dismissed the application for review.

On 30 June 2020 Mr Marsh filed a summons seeking judicial review of the decision of the proper officer. On 4 June 2021 the primary judge, Simpson AJ, (i) quashed the decision of the proper officer and (ii) ordered that the medical assessment be referred to a review panel.

The latter order is significant. Generally, where a power depends upon the satisfaction of another body or tribunal, a court exercising judicial review, having set aside a decision of that body or tribunal, will remit the matter to be determined according to law. It is only where the court determines that, as a matter law, only one determination could have been made that it has jurisdiction to make such an order: Supreme Court Act 1970 (NSW), s 69(3)(b).

Simpson AJ was mindful of that constraint. [1] The order reflected the following finding:

This reasoning is founded on a misconstruction of the scheme of s 63 of the Act and, in particular, the specific function conferred on the proper officer. The exercise in construing the Act requires giving meaning to the term “incorrect” as applied to a medical assessment, within the statutory context. There are three aspects of the statutory context which are significant.

First, s 63 confers no right of appeal from a medical assessment. Rather, it confers a power to seek a review, conditioned upon satisfaction of the proper officer as to the statutory criterion. It is “only if” the proper officer is so satisfied that a review panel will be constituted and the assessment referred to it. This scheme does not envisage that referral will be the usual, let alone the inevitable outcome of an application. The opinion of the proper officer has been called a “gateway”; statutory gateways are there to deny a review as of right.

Secondly, the subject matter of a medical assessment is a “medical dispute” which may be referred for assessment under Pt 3.4 of the Act: s 60. The term “medical dispute” is defined to mean a “disagreement or issue to which this Part applies”: s 57. Thus, the subject matter of the assessment will usually, if not invariably, entail a difference of opinion between medical practitioners. Accordingly, if the existence of differing opinions was sufficient to give rise to a reasonable cause to suspect that a particular assessment was incorrect, the gateway function conferred on the proper officer would be rendered nugatory.

Thirdly, as recognised by the High Court in relation to a similar statutory scheme in Victoria, the function of a medical assessor is to form his or her own opinion on the medical question in dispute; it is not to choose between competing opinions, nor to assess the correctness of such opinions. [2] As the High Court concluded, with respect to a medical panel:

If the proper officer were to find reasonable cause to suspect that an assessment was incorrect merely because conflicting medical opinions had been provided, that would reveal a misunderstanding of the function of the medical assessor. In other words, the existence of conflicting opinions, far from providing an invariable basis for referral to a review panel, cannot, by itself, constitute a ground for referral to a review panel.

Fourthly, while the term “proper officer of the Authority” is only used in relation to the referral of a matter for further medical assessment or for assessment by a review panel, [4] there is no basis for inferring that the officer will be medically trained. Accordingly, it would be wrong to construe the required state of satisfaction of the officer as involving medical reasons to suspect that the assessment was “incorrect in a material respect”.

The function of the court undertaking judicial review of a decision of the proper officer is that identified by Leeming JA in AAI Ltd t/as AAMI v Chan: [5]

Apart from the fact of conflicting opinions, the primary judge identified only one passage in the reasons of the proper officer supportive of a finding that he had failed to address the correct question. After noting the finding by the assessor that “the current condition [of the claimant] is unrelated to the motor accident and is simply the natural progression of the underlying degenerative disease”, the proper officer continued:

There are three difficulties in relying upon this last statement as indicative of legal error. First, it was not the conclusion of the proper officer’s reasoning: the paragraph ended with him saying that he was “not satisfied there is reasonable cause to suspect the assessment is incorrect in a material respect based on this submission.” That is, he expressed his conclusion in accordance with the statutory criterion.

Secondly, to describe a finding as “open” was consistent with finding an absence of the kind of error which would have rendered the opinion possibly incorrect in a material respect. It was not for the proper officer to say whether the assessor’s medical opinion was correct or incorrect. He was neither qualified nor required to do so, and did not purport to do so.

Thirdly, the proper officer was addressing a submission that “[t]he only available conclusion on causation … is that causation was proved, viz, that the proposed surgery to treat the neck and cervical spine was reasonably necessary as a result of the [motor vehicle accident]”. That submission, which may have been overstated, was rejected by describing the contrary finding as “open”.

As is well-understood, taking one sentence out of a set of reasons, analysing it in isolation from its context, and purporting to identify error is fraught with danger. In the present case that risk came to fruition: the sentence said to reveal error provided no basis for challenging the legality of the opinion formed by the proper officer.

For these reasons, I agree with the orders proposed by White JA.

MACFARLAN JA: I agree with White JA.

WHITE JA: This is an appeal from orders of the Common Law Division, Marsh v Insurance Group Ltd t/as NRMA Insurance Ltd [2021] NSWSC 619 (Simpson AJ).

On 7 or 8 August 2012 the respondent, Mr Robert Marsh, was a passenger in a motor vehicle that was repeatedly rammed by the driver of another motor vehicle in an episode of road rage. There was no issue that he suffered injury as a result of the behaviour of the driver of the other vehicle. The appellant, Insurance Australia Ltd (NRMA), was the insurer of the driver of the other vehicle under a third-party policy issued under the Motor Accidents Compensation Act 1999 (NSW). It admitted liability (s 81).

Section 83 of the Motor Accidents Compensation Act provides that once liability has been admitted against the person against whom the claim is made, it is the duty of an insurer to make payments to or on behalf of a claimant in respect of, amongst other things, hospital expenses, medical expenses and, in respect of a claimant who is seriously injured and in need of constant care over a long term (as described in the section), attendant care services expenses. The insurer’s liability applies to such expenses to the extent they are reasonable and necessary in the circumstances, properly verified, and relate to the injury caused by the fault of the owner or driver of the motor vehicle to which the third-party policy relates.

Chapter 4 of the Act contains elaborate provisions for the making of claims for damages in respect of injury caused by the fault of the owner or driver of the motor vehicle, including a requirement that a notice of the claim provided by the claimant provide particulars and information required by a form approved by the State Insurance Regulatory Authority (s 74).

On 15 August 2019, the solicitors for NRMA wrote to the solicitor for Mr Marsh referring to particulars provided on behalf of Mr Marsh dated 9 April 2019 outlining his claims for future treatment and future domestic assistance. The claims made were for one future cervical fusion surgery, one to twelve general practitioner consultations per year for Mr Marsh’s life expectancy, and up to 60 minutes of future paid domestic assistance per week from the date of the MAS assessment for his life expectancy. NRMA’s solicitors advised that the claims were disputed and that NRMA declined to make any payment in respect of them. They submitted that the need for treatment was not related to injuries caused by the accident and the treatment requested was not reasonable and necessary.

This was a medical dispute within the meaning of Pt 3.4 of the Act, being “…a disagreement or issue to which this Part applies” (s 57). Section 58, provides that Pt 3.4:

The medical dispute was required to be and was referred to the State Insurance Regulatory Authority for the dispute to be referred to a medical assessor (s 60).

There had been an earlier dispute as to the degree of permanent impairment suffered by Mr Marsh as a result of his injury caused by the motor accident. On 17 October 2018 a medical assessor, Dr Alan Home, issued a certificate under Pt 3.4 of the Act as follows:

Dr Home determined that Mr Marsh had suffered 5% whole person impairment attributable to soft tissue injury to the cervical spine aggravating underlying degenerative change that was causally related to the motor vehicle accident. Dr Home’s certificate is conclusive evidence as to the matters certified in any court proceedings or in any assessment by a claims assessor in respect of the claim concerned (s 61(2)), viz. Mr Marsh’s degree of permanent impairment from injuries caused by the motor vehicle accident. His reasons were not conclusive evidence in respect of the medical dispute concerning treatment issues under s 58(1)(a) and (b).

The treatment dispute was referred for assessment to a different medical assessor, Dr Philip Truskett.

The issues identified in NRMA’s application for assessment of the treatment dispute were whether the proposed cervical fusion surgery, general practitioner consultations and claim for future paid domestic assistance were not related to injuries caused by the accident and were not reasonable and necessary. Numerous medical reports, X-rays and MRIs both preceding and subsequent to the accident were provided to Dr Truskett including the report of Dr Home, and reports of a Dr Ferch and Associate Professor Kleinman.

On 5 February 2020 Dr Truskett issued two certificates under Pt 3.4 of the Act certifying that:

On 31 January 2020 Mr Marsh had attended on Dr Truskett and was examined by him. As part of the history taken from Mr Marsh, Dr Truskett recorded that Mr Marsh reported having attended Dr Ferch (spinal surgeon at Newcastle) and apparently cervical fusion had been offered but refused by the insurer. Dr Truskett recorded that Mr Marsh believed that his neck injury was entirely related to his motor vehicle accident and recorded his reported symptoms.

Dr Truskett carried out a clinical examination of Mr Marsh’s neck. His findings on clinical examination differed in a number of respects from those recorded by Dr Home on 18 October 2018. Dr Home reported that on clinical presentation there was “spinal dysmetria and muscle guarding”. Dr Truskett found that on his examination of Mr Marsh’s neck there was no muscle guarding and no dysmetria.

Dr Truskett reviewed medical reports, including those of Dr Ferch and Professor Kleinman. Those reports were not in evidence before the primary judge. The primary judge relied upon Dr Truskett’s summary of those reports. Dr Ferch’s reports of 14 July 2015 and 15 November 2017 (as summarised by Dr Truskett) described degenerative changes over a number of levels (C5-6 and C6-7 of the cervical spine). Associate Professor Kleinman’s reports, as summarised by Dr Truskett, included a report of 27 March 2018 in which Associate Professor Kleinman stated that he believed that surgery to the neck was needed as a result of the motor vehicle accident due to aggravation of pre-existing asymptomatic degenerative change in the cervical spine. Dr Truskett also referred to a report of Associate Professor Kleinman dated 30 January 2018 stating:

Dr Truskett’s determination was as follows:

In Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43, the High Court dealt with the functions of a Medical Panel established under the Victorian Accident Compensation Act 1985 to certify the Panel’s opinion on medical questions in respect of injured workers entitled to compensation under that Act and in relation to common law claims against the employer for damages. The certificate of the opinion of the Medical Panel on the medical question was to be final and conclusive. In relation to the functions of the Medical Panel, the High Court stated (at 498-499):

Dr Truskett, as a medical assessor, had the same function (Insurance Group Ltd t/as NRMA Insurance v Keen [2021] NSWCA 287 at [42]-[43]).

A medical assessor’s opinion is required to reflect his or her own professional judgment as to the medical dispute submitted for his or her assessment.

Mr Marsh sought a review of the medical assessment by a review panel. Section 63 of the Act then provided:

The form of an “Application for a review of a medical assessment”, Form 5A, stipulated that the applicant for referral should give detailed reasons in support of the application and, if it were said there was more than one error, the applicant should explain each error in a separate paragraph and should refer to particular sections or paragraphs of the medical assessment said to be incorrect. The solicitors for Mr Marsh stated that the whole of the MAS certificate was incorrect and referred to attached submissions dated 4 March 2020. In answer to the question: “What is the error or mistake?” they stated “Please see paragraph 6-31 of the attached submissions dated 4 March 2020”.

The “particulars set out in the application” referred to in s 63(3) to which the proper officer of the Authority was required to have regard were those matters stated in the attached submissions.

On appeal, Mr Hart, who appeared for the respondent, submitted that the proper officer was required to have regard to all the material that was before him, including all the material that was before the assessor.

Whatever the scope for argument as to what may constitute the particulars set out in the application for referral of the medical assessment to a review panel (Meeuwissen v Boden (2010) 78 NSWLR 143; [2010] NSWCA 253 at [29]), it is not reasonably arguable that the words in s 63(3) “having regard to the particulars set out in the application” should be read as “having regard to all of the materials before (or available to) the proper officer”. That is not to say that s 63(3) is to be read as meaning that the proper officer is to have regard only to the particulars set out in the application. That question does not arise on the appeal. But it does mean that the proper officer’s reasons will need to address the particulars set out in the application (in this case, the accompanying submission), and should be read in this light.

The submissions attached to the application for review of the medical assessment identified three alleged errors, namely:

After referring to the definition of “causation” in cl 1.6 of the Motor Accident Permanent Impairment Guidelines and authorities at common law and under s 5D of the Civil Liability Act 2002 (NSW) in relation to causation, the submissions in support of the first ground continued:

The role of the proper officer is not to decide, or be satisfied, that the medical assessor erred in a material respect, but only to be satisfied (or not) that there is reasonable cause to suspect such error. The proper officer’s role is that of a gatekeeper, not a decision-maker (Meeuwissen v Boden at 148, [22]-[23]).

The proper officer determined that he was not satisfied that there was reasonable cause to suspect that the medical assessment was incorrect in a material respect and accordingly dismissed the application. In respect of the first ground of review (failing to apply correct test of causation) he quoted Mr Marsh’s submissions including that the only available conclusion on causation was that causation had been proved and that the proposed surgery to the neck and cervical spine was reasonable and necessary as a result of the accident (para [19] of submission quoted at [28] above). The proper officer referred to the assessor’s discussion of relevant medical evidence and aspects of the assessor’s report and continued:

He then dealt with the applicant’s second and third submissions under the headings “failing to provide natural justice” and “illogical reasoning for causation”. In relation to the latter, he concluded:

The proper officer identified the documents he had taken into account. These included all of the documents provided prior to Dr Truskett’s assessment.

Mr Marsh sought judicial review of the proper officer’s decision. He asserted that the proper officer’s decision contained errors of law on the face of the record, demonstrated jurisdictional error, and was beyond power.

The primary judge was critical of the asserted grounds for relief stated in the summons (J [36]-[37]). The primary judge then said:

The primary judge rejected the second point but upheld the first. In respect of the second point her Honour said:

The respondent did not file a notice of contention to challenge this finding.

As to the first point, the primary judge’s essential reasoning was as follows:

Having reached this conclusion, the primary judge did not quash the proper officer’s decision and remit the matter to him or to the Authority to be determined according to law, but rather quashed the decision and ordered that the medical assessment be referred to a review panel of at least three medical assessors pursuant to s 63(3) (at J [69]).

NRMA appealed on the grounds that the primary judge erred in

As to the first ground, with respect to the primary judge, the proper officer did not seek to decide the matter on its merits. His finding that Dr Truskett’s opinion was “open to him based on the evidence” did not address the correct question. But it did address the submission made to him. The submission was that:

The proper officer prefaced his statement with the words “Contrary to the submission of the applicant”. He was addressing the submission of the applicant for review that the assessor’s finding was not open to him and that the only available conclusion was that the proposed surgery was reasonable and necessary as a result of the motor vehicle accident.

This response to the submission put to him did not indicate that the proper officer mistook his function as a gatekeeper. He repeatedly applied the correct test, including in the same impugned paragraph, as to whether he was satisfied that there was reasonable cause to suspect that the assessment was incorrect in a material respect.

As to the second and third grounds of appeal, the existence of significant differences of opinion between the medical assessor and other medical practitioners does not mean that the proper officer mistook his function in not being satisfied that there was reasonable cause to suspect that the medical assessor erred in a material respect having regard to the particulars accompanying the application for referral to a review panel. Nor is it correct that where there are conflicting opinions of medical practitioners specialised in their field, a proper officer must have reasonable cause to suspect that the medical assessment is incorrect in a material respect.

Only a medical dispute is referred to a medical assessor. In the absence of conflicting medical opinion there is unlikely to be a medical dispute. If a proper officer would always have to have reasonable cause to suspect material error because there was medical opinion that differed from the opinion of the assessor, there would be no real gatekeeper function for the proper officer to exercise.

The existence of conflicting reputable medical opinions might well mean that the proper officer would inevitably have reasonable cause to suspect that a review panel might reach a different conclusion from the medical assessor. But that is not the question. The question is whether the proper officer is satisfied that there is reasonable cause to suspect material error by the assessor. Because the assessor’s task is not to pronounce on the correctness of other medical opinion but to form his or her own opinion, it is necessary for an applicant under s 63(1) to persuade the proper officer of reasonable cause to suspect material error in the assessor’s consideration, eg by the ignoring of important facts or not undertaking the assessment correctly, either procedurally or by not addressing the right questions (Meeuwissen v Boden at [22]).

The primary judge was correct in saying that it is not the role of the proper officer to choose between competing medical opinions (J[65]). Nor is that the role of the medical assessor. The proper officer did not mistake his role.

Mr Marsh submitted to the proper officer that there were no symptoms of radiculopathy before the accident and the later symptoms were due to compression of the nerve roots due to the injury. He did not submit that Dr Truskett failed to consider any relevant medical report. Dr Truskett considered the reports of Dr Home and Associate Professor Kleinman, but on his own examination and professional judgment considered that Mr Marsh’s ongoing neck pain was due to degenerative changes of the neck that were in existence before the accident. He considered that the observed aggravation of the degeneration due to the accident would have abated over the ensuing six to twelve months. The fact that two other doctors had earlier expressed a different opinion following their examinations does not mean that the proper officer ought to have had reasonable cause to suspect that Dr Truskett’s medical assessment was incorrect in a material respect. The fact that different doctors form different opinions following their respective examinations of a person does not mean that one or other must have made an error. Even if the detection of the presence or absence of radiculopathy admits only one right answer, whether observed radiculopathy was due to trauma or degenerative change (or both) may not be susceptible to a right or wrong answer. There was no evidence to show that it was.

As to the fourth ground, the primary judge acknowledged that the required state of satisfaction is that of the proper officer, not the court (J [44]). Her Honour held that, as a matter of law, only one determination should have been made by the proper officer (J [68]). For this reason her Honour ordered that the medical assessment be referred pursuant to s 63(3) of the Act, to a review panel of at least three medical assessors.

The conclusion that the assessment should be referred to a review panel rather than the proper officer, or to another proper officer, for redetermination, followed from her Honour’s conclusion that because of conflicting medical opinion only one course was open to the proper officer. For the reasons above, that conclusion was wrong.

For these reasons I propose the following orders: