Nominal Defendant v Adilzada

1. [1]

   McCOLL JA: I agree with Meagher JA’s reasons and the orders his Honour proposes.

2. [2]

   MEAGHER JA: The applicant Nominal Defendant seeks to appeal from orders determining two separate questions arising in proceedings brought by the respondent in relation to injuries, including a serious brain injury, he sustained in a motor accident on 18 October 2007: Said Mojahid Adilzada v The Nominal Defendant (District Court (NSW), Elkaim SC DCJ, 15 March 2016, unrep). The applicant requires leave to appeal because the orders answering those questions were interlocutory: District Court Act 1973 (NSW), s 127(2)(a).

3. [3]

   The first of those questions concerns the construction and application of s 86 of the Motor Accidents Compensation Act 1999 (NSW) (MAC Act), which relevantly provides:

4. [4]

   The question of construction is whether the purposes for which the insurer may make a request that the claimant undergo a medical examination include to assess that person’s eligibility for lifetime participation in the Lifetime Care and Support Scheme (Scheme) introduced by the Motor Accidents (Lifetime Care and Support) Act 2006 (NSW) (LCS Act).

5. [5]

   In July 2011 the respondent commenced proceedings in the District Court against the Nominal Defendant for damages. That claim included damages for economic loss for attendant care services provided or to be provided to the respondent over his lifetime.

6. [6]

   Because the motor accident occurred after 1 October 2007, the respondent was entitled, if eligible, to be accepted as a participant in the Scheme. The amendments to that Act made by the Motor Accidents and Lifetime Care and Support Schemes Legislation Amendment Act 2012 (NSW) do not apply to his claim because it was made before the introduction of the Bill for that Act into Parliament. Those amendments omitted ss 6 and 10 of the LCS Act as originally enacted, inserted ss 5A, 11A, 11B, 11C and made minor amendments to ss 48, 49 and 54. They also amended s 43A of the MAC Act (as then current), omitted s 130A and replaced it with s 141A. The consequence is that the respondent’s claim remains subject to s 130A.

7. [7]

   Whether an injured person is a participant in the Scheme affects their entitlement to recover damages for treatment and care needs. As defined in the LCS Act (as originally enacted), those needs include medical treatment, rehabilitation, attendant care services, domestic assistance and education and vocational training (s 6(2)). Attendant care services are services “that aim to provide assistance to people with everyday tasks, and includes (for example) personal assistance, nursing, home maintenance and domestic services” (s 3(1)). Section 130A of the MAC Act (the construction and application of which was considered in Daly v Thiering (2013) 249 CLR 381; [2013] HCA 45) provides that no damages may be awarded to a participant in the Scheme for economic loss for treatment and care needs provided for by that participation and a person who has been awarded damages pursuant to a final judgment in respect of those needs is not eligible to be a participant of the Scheme (LCS Act, s 7(3)).

8. [8]

   A person who has made a motor accident claim is eligible for participation if the person’s injury satisfies criteria specified in the Lifetime Care and Support Guidelines (Guidelines) issued by the Lifetime Care and Support Authority of New South Wales (Authority) under s 58. (The version of those Guidelines to which reference is made in these reasons is the version stated as applying to applications for participation received on or after 25 May 2012). If the Authority is satisfied that a person is eligible, and that application for their participation has been duly made, it must accept the person as an interim or lifetime participant, the former being participation for a period of two years (ss 9(2), (5)).

9. [9]

   The application for a person to become a participant may be made by the injured person or by the “insurer of a claim” made by the person. That insurer is the “insurer for the purposes of Chapter 4 (Motor accident claims) of the Motor Accidents Compensation Act 1999 in relation to the claim” (s 3(1)). The making of an application by the insurer does not require the consent of the injured person (ss 8(1), (2)). In addition the State Insurance Regulatory Authority (SIRA) may direct the insurer to make such an application and the insurer must comply with that direction (s 8(3)).

10. [10]

    Thus, as was noted by the Court (Crennan, Kiefel, Bell, Gageler and Keane JJ) in Daly v Thiering at [4], it is “open to the CTP insurer of a claim to override a choice by an insured person not to become a participant in the Scheme”, and at [45] that the “legislative package consisting of the LCS Act and s 130A of the MAC Act” confers a “choice” on the insurer that an eligible person become a participant in the Scheme. See also Insurance Australia Limited t/a NRMA Insurance v Milton [2016] NSWCA 156 at [3] (Basten JA, Leeming and Simpson JJA agreeing) where it was observed that if an application for participation has been duly made, an eligible person “cannot opt out of the scheme”.

11. [11]

    In relation to a brain injury the Guidelines require a certificate from a medical specialist attesting that they have examined the injured person and sighted a Functional Independence Measure (FIM) assessment in which, due to the brain injury, that person has achieved a score of five or less on any of the items on the FIM. The Guidelines also provide that an application for lifetime participation, when made after the expiration of the two year period of interim participation, must be accompanied by a FIM assessment completed within two months of the date of the application (s 9(6) and Guidelines, Pt 1 Cll 2.2, 7).

12. [12]

    In January 2013 the respondent was accepted as an interim participant in the Scheme, following an application made by the Nominal Defendant under s 8(1). That application, made in December 2012, was accompanied by an FIM assessment undertaken by Professor Cameron, a rehabilitation physician. During the following two years the respondent did not accept treatment and care offered to him by the Authority. On 12 January 2015 the Authority advised the respondent that his two year period of interim participation had expired; and on 14 January 2015 the applicant’s solicitor inquired of the respondent’s solicitors as to his availability to undergo another FIM assessment. By a further email of 14 February 2015 the applicant’s solicitor advised that he was instructed to arrange for Professor Cameron to re-examine the respondent and asked whether the respondent would travel to Sydney to undergo that examination. There was no response to that request.

13. [13]

    On 9 April 2015, the applicant filed a notice of motion seeking an order pursuant to Uniform Civil Procedure Rules 2005 (UCPR), r 23.4 that the respondent submit to a medical examination by Professor Cameron for assessment of his eligibility as a lifetime participant in the Scheme. In the alternative, orders were sought that the respondent comply with the applicant’s request under s 86(1) that he attend a medical examination, and that the proceedings be stayed until the respondent complied with that request. The applicant no longer relies on UCPR r 23.4 as providing a basis for requiring the respondent to undergo a medical examination.

14. [14]

    That motion was listed for hearing on 21 July 2015. On that occasion consent orders were made which provided for the respondent to be examined by Professor Cameron. A disagreement subsequently emerged as to the purpose of that examination. When it became apparent that Professor Cameron had undertaken a second FIM assessment, and that the applicant proposed to rely on it to support an application for the respondent’s lifetime participation, the proceedings were relisted before the primary judge.

15. [15]

    After a short hearing in October 2015 his Honour set aside the consent orders, so as to revive the motion of 9 April. In the course of that hearing counsel for the Nominal Defendant described the “central” issue between the parties as being: (tcpt 22/10/15, p 2)

16. [16]

    The parties subsequently agreed that the notice of motion raised three questions that should be determined. Unfortunately as formulated those questions did not in terms address the “central” issue earlier identified. The second and third of the questions were:

17. [17]

    His Honour answered paras (a), (b) and (c) of question 2 in the negative. It followed, and the parties agreed, that paras (a), (b) and (c) of question 3 also should be answered in the negative. The Nominal Defendant seeks leave to appeal from the orders answering each of those questions.

18. [18]

    The second question is not confined to the “central” issue described above and also inquires whether s 86 confers power on a court to compel a claimant to undertake a medical examination or assessment in circumstances where they have failed to comply with a request that they do so. The primary judge did not consider this question of power, noting that as between the parties there was no dispute “that a court can order a claimant to meet the obligations stated in Section 86”: [20]. In my view that consensus as between the parties does not reflect the proper construction of s 86 as to the conferral of such a power.

19. [19]

    Section 86 does not in terms confer power on a court to order that any request to undergo a medical examination or assessment be complied with. Nor would the conferral of that power be implied unless it was clearly necessary to do so, because of the basic rights which its exercise would override: Coco v The Queen (1974) 179 CLR 427; Fernando v Commissioner of Police (1995) 36 NSWLR 567. Subsection 4(b) provides a sufficient sanction in the event that a claimant fails without reasonable cause to comply with a request under subs (1). That sanction is that court proceedings cannot be commenced, or if commenced, cannot be continued, whilst the failure to comply with that request continues.

20. [20]

    Notwithstanding this difficulty in the formulation of question 2, the underlying issue raised by the question is of general importance and at the heart of the dispute between the parties. The respondent’s present position is that he does not want to become a participant in the Scheme and will not attend any medical examination which is directed to securing that outcome. For that reason, the Nominal Defendant should have leave to appeal from the order determining question 2, for the purpose of arguing that the answer to the question should be qualified to make clear that a request may be made under s 86(1) for the purpose of an assessment of the claimant’s eligibility for participation in the Scheme.

21. [21]

    The respondent contends that leave should not be granted in relation to question 3. That question addresses whether, even if s 86 can be used to compel the respondent to undergo a medical examination, the applicant should be permitted to rely on the further FIM assessment of Professor Cameron.

22. [22]

    The primary judge described the earlier “misunderstanding” between the parties which resulted in the obtaining of the second FIM assessment:

23. [23]

    It is submitted on behalf of the respondent that had it been appreciated that the further medical examination was to be used for the purpose of determining his eligibility for participation in the Scheme, arrangements would have been made that he be accompanied to the examination, either by his treating physician or some other person who was independent of his father and tutor. In the face of that submission, accepting that there was a misunderstanding at the time the consent order was made, the applicant indicated that it would not press for an affirmative answer to question 3 in the event that it is successful in relation to question 2. In these circumstances, it is not necessary to consider question 3 and leave to appeal from the order answering that question should be refused.

24. [24]

    Like s 119 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW), s 86(1) imposes an obligation on a claimant to undergo a medical examination. In doing so it confers a power in the insurer (and the person against whom the claim is made) to engage that obligation. See Kurnell Passenger & Transport Service Pty Ltd v Randwick City Council (2009) 230 FLR 336; [2009] NSWCA 59 at [3] (Giles JA); [9] (McColl JA); [81], [116] (Basten JA).

25. [25]

    There is no difficulty in identifying what may be the subject of a request made under s 86(1). It is that the claimant undergo an examination or assessment of the kind described in paras (a), (b) or (c) which is not “unreasonable, unnecessarily repetitious or dangerous”. The circumstances in which such a request may be made are constrained by the purpose or purposes for which the power to make the request may be exercised. Those purposes describe the ambit or scope of the power and in accordance with established principle, must be “inferred from the construction of the Act read as a whole”: per Gibbs CJ in The Queen v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170 at 186 (citing Lord Reid in Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997 at 1033).

26. [26]

    The primary object of that task of construction was described by the plurality (McHugh, Gummow, Kirby and Hayne JJ) in Project Blue Sky v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [69] as follows:

27. [27]

    It is convenient first to refer to the relevant provisions of the LCS Act, and then to the application of s 86 within Chapter 4 of the MAC Act.

28. [28]

    The LCS Act confers an entitlement on the “insurer of a claim” to make an application for an injured person to become a participant in the Scheme without that person’s consent. The “claim” is that person’s claim for damages in respect of injury caused in a motor vehicle accident (LCS Act, s 5; MAC Act, s 3). The insurer is the “insurer for the purposes of Chapter 4 (Motor accident claims)” of the MAC Act with respect to that claim (s 3(1)). Under ss 78 and 80 of the MAC Act the insurer has the conduct and control of the defence of that claim, as well as of any negotiations to compromise or settle it, and is required to resolve the claim as justly and expeditiously as possible.

29. [29]

    Section 6 of the MAC Act provides that in the interpretation of its provisions a construction that would promote the objects of that Act is to be preferred to one that would not (s 6(1)). Those objects, identified in s 5, include to provide appropriately for the future needs of those with on-going disabilities; to provide compensation for compensable injuries and encourage the early resolution of compensation claims; to keep premiums affordable, recognising that third-party bodily injury insurance is compulsory; and to benefit all members of the motoring public by keeping the overall costs of the third-party scheme within reasonable bounds.

30. [30]

    The purpose for the establishment of the LCS Scheme was summarised by Garling J in Thiering v Daly (2011) 83 NSWLR 498; [2011] NSWSC 1345, in a passage adopted in the judgment of the High Court at [14]. The features of the Scheme include that it cover those who, as a consequence of a motor vehicle accident, were catastrophically and permanently injured; that it would provide for all of that treatment and care, including attendant care, for as long as was necessary on an individually assessed basis; and that because the Scheme would attend to the provision of lifetime treatment and care, an injured person would not need, and would not be entitled to, compensation by way of damages for any treatment and care needs.

31. [31]

    Chapter 4 of the MAC Act applies to claims in respect of motor accidents. In the first instance the claim must be made against the third party insurer, which is given the conduct and control of negotiations in respect of the claim, as well as the conduct of any legal proceedings by which it is pursued (s 78(1)). If the claim cannot be resolved by agreement, there is provision for it to be submitted to a process of administrative assessment. If that assessment does not satisfactorily resolve the claim, it may then be determined by the taking of court proceedings (s 107). Chapter 5 applies to the awarding of damages by a court, and to assessments of damages undertaken as part of the administrative process directed to the settlement and resolution of claims.

32. [32]

    Chapter 4, Pt 4.3, imposes duties on the insurer and the claimant with respect to the assessment and resolution of a claim. Some of those duties are imposed in general terms. Others apply depending on whether court proceedings have or have not been commenced. An overriding duty is imposed on the insurer to endeavour to resolve the claim, by settlement or otherwise, as justly and expeditiously as possible (s 80(1)). The duties imposed on a claimant include to co-operate with the person against whom the claim is made and that person’s insurer for the purpose of giving them “sufficient information” to be able to make “an early assessment of liability” and “an informed offer of settlement” (s 85(1)). That duty applies until court proceedings have been commenced in respect of the claim.

33. [33]

    Section 86 is concerned with the provision of information of a particular kind. Specifically it is directed to ensuring that the person against whom the claim is made, or that person’s insurer, have for the purpose of responding to the claim, the benefit of medical examinations and assessments undertaken by practitioners or assessors nominated by them.

34. [34]

    As appears from [10] above, the LCS Act confers a “choice” on the CTP insurer to respond to a claim made by a person eligible to become a participant in the Scheme by electing to have their treatment and care needs dealt with in the Scheme rather than by an award of damages. Section 130A is part of and gives effect to that legislative scheme by removing the claimant’s entitlement to damages for such needs as are covered by the Scheme.

35. [35]

    In making a request under s 86(1) for the purpose of determining a claimant’s eligibility for participation in the Scheme, the insurer is responding to the claim in a way expressly provided for by s 130A and the LCS Act. Its doing so is within the purpose for which the entitlement in s 86(1) is conferred. In concluding otherwise the primary judge did not have sufficient regard to the scheme of the two Acts and the significance of s 130A.

Conclusion

1. [36]

   In my view the appeal should be allowed and the orders determining question 2 should be set aside. That question should be answered as follows so as to take account of the observation in [19] above:

2. [37]

   However before any orders are made giving effect to that outcome the parties must have an opportunity to make submissions as to whether the applicant should be permitted to amend its notice of appeal as proposed by draft order 3 in [39] below.

3. [38]

   If the application and appeal are dealt with as I suggest, I would also propose that the costs order made in the Court below not be disturbed and that there be no order as to the costs of the appeal. That is an appropriate outcome which takes account of the general importance of the more specific issue that the fuller answer to the question as formulated by the parties provides.

4. [39]

   Subject to hearing from the parties, I consider the following orders should be made:

5. [40]

   To permit the parties to be heard on these additional matters, the following direction should be made:

6. [41]

   GLEESON JA: I agree with Meagher JA.