Wood v Insurance Australia Group Limited trading as NRMA Insurance

1. [1]

   On 15 June 2015, the plaintiff, Joshua Wood, was involved in a motor vehicle accident when his car was rear-ended whilst stationary on a street in Kotara, NSW. The vehicle at fault was insured by the first defendant insurer, “NRMA”. Mr Wood made a claim for damages against NRMA in respect of injuries and loss he claims to have suffered in the motor accident. Of particular relevance is his claim that he suffered, amongst other things, a lower back injury. His claim is governed by the Motor Accidents Compensation Act 1999 (NSW) (the “MAC Act”).

2. [2]

   In these proceedings Mr Wood seeks judicial review of the certificate regarding whole person impairment issued by the Review Panel on 21 May 2024. The Review Panel concluded that he had 0% whole person impairment in respect of his lower back injury. The third defendant, the President of the Personal Injury Commission (“PIC”) and the Review Panel have filed submitting appearances.

3. [3]

   To pursue his claim for judicial review of the Review Panel’s certificate, Mr Wood needs an extension of time under Uniform Civil Procedure Rules 2005 (NSW) r 59.10. His delay in commencing proceedings is explained adequately in the affidavit of Michael Karl Evers sworn 13 September 2024. The delay was approximately one month in length. I was not made aware of any prejudice to NRMA. In the circumstances I exercise my power under subrule 2 to extend the time for filing the application for review. However, for the reasons that follow, Mr Wood’s proceedings will be dismissed.

Statutory framework and principles relevant to medical assessments under the MAC Act

1. [4]

   It is necessary to outline the statutory framework that underpins this application for judicial review, not the least because the approach taken by counsel for Mr Wood blurs the statutory basis and effect of provisions relevant to the referral and review of medical assessment matters under the MAC Act, and misconstrues the effect of binding decisions that interpret those provisions.

2. [5]

   Part 3.4 of the MAC Act makes provision for medical assessment and provide the scheme for the resolution of disagreements between claimants and insurers.

3. [6]

   Section 58 of the MAC Act sets out the disagreements to which Part 3.4 applies:

4. [7]

   As can be seen from the text of s 58, the question of causation is an intrinsic part of the medical assessment matter described in s 58(1)(b) as well the matter in s 58(1)(d). This is an important observation in the context of complaint made by Mr Wood arising from the separate referrals of medical assessment matters that were made. The first referral was in early 2020 to Dr Frank Machart asking him to address questions under s 58(1)(a) and (b) regarding the spinal surgery performed in April 2018. The second referral was to Dr Christopher Harrington, asking him to assess the question of whole person impairment under s 58(1)(d).

5. [8]

   The question of causation to be decided under s 58(1)(b) (and, separately, s 58(1)(d)) are matters for the medical assessor and, upon review, the review panel: Motor Accidents Authority of NSW v Mills (2010) 78 NSWLR 125; [2010] NSWCA 82 (“Mills”) at [61]-[63] (Giles JA, with whom Tobias JA & Handley AJA agreed); AAI Ltd t/as AAMI v Chan [2021] NSWCA 19 at [6] (Leeming JA, with whom Gleeson JA agreed).

6. [9]

   The significance of an assessment under s 58(1)(d) is that s 131 of the MAC Act provides that no damages may be awarded for non-economic loss unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor vehicle accident exceeds 10%.

7. [10]

   Disagreements, or “medical disputes”, may be referred to the Motor Accident Authority (and, under later legislation, to the President of the PIC) by a party, court or claims assessor: s 60(1). The Motor Accident Authority or PIC will then refer the dispute to one or more medical assessor(s): s 60(2). The medical assessor undertakes an assessment and gives a certificate as to the matters referred: ss 61(1). That 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), although a court may reject a certificate in certain limited circumstances s 61(4). (Emphasis added). The certificate must set out the reasons for any finding by the medical assessor as to any matter certified in the certificate: s 61(9).

8. [11]

   For obvious reasons, a medical assessment does not bind a later assessor or review panel and so is not, and cannot be, “conclusive evidence” that binds other medical assessors. Each assessor (and review panel) must provide their own fresh assessment, which in the case of a review panel, will either confirm the earlier certificate or revoke the certificate and issue a new one: s 63(4). As stated by Adamson J in Lithgow v Insurance Australia Ltd trading as NRMA Insurance [2017] NSWSC 1104 (“Lithgow”) at [44]:

9. [12]

   Section 63 provides for review of a medical assessment by a review panel:

10. [13]

    Of particular note here is the provision that a review panel must conduct a fresh assessment of all the matters with which the medical assessment is concerned; the review is not limited to the aspect of the certificate that is alleged to be incorrect: s 63(3A).

11. [14]

    The function of a review panel was explained by the High Court in Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 at [47]:

12. [15]

    There is no obligation for a review panel to consider or refer to every piece of evidence presented. As Giles JA stated in McKee v Allianz (2008) 71 NSWLR 609; [2008] NSWCA 163 at [38]:

13. [16]

    Section 44 of the MAC Act authorises the Motor Accident Authority to issue guidelines. Relevantly, the Permanent Impairment Guidelines in place at the time discuss the concept of “causation of injury” at 1.5 to 1.7:

Background facts and procedural history

1. [17]

   Mr Wood forwarded a personal injury claim form to NRMA on 5 February 2016 identifying injuries to his lower back and left side. In April 2018 he underwent neurosurgery performed by Dr Sears, involving a L5/S1 microdiscectomy and right S1 rhizolysis.

2. [18]

   A disagreement arose between the claimant and NRMA about whether the operative treatment provided to the claimant by Dr Sears in April 2018 was reasonable and necessary in the circumstances, and whether such treatment related to the injury caused by the motor accident. This disagreement comprised two separate “medical assessment matters” as set out in s 58(1)(a) and (b) of the MAC Act. These matters were referred to Medical Assessor Dr Frank Machart, under s 60 of the MAC Act.

3. [19]

   On 13 February 2020 Dr Machart assessed Mr Wood. On 6 May 2020, Dr Machart issued a certificate addressing the two medical assessment matters referred to him. He concluded that “the pathology for which the L5 S1 microdiscectomy was conducted was as a result of the MVA” and that the surgery was “appropriate treatment, reasonable and necessary in the circumstances”.

4. [20]

   His determinations regarding those two matters confined to “Treatment” were set out at the end of the certificate as follows:

5. [21]

   In June 2020, NRMA applied for Dr Machart’s assessment to be referred to a review panel. In August 2020, the application was dismissed under s 63(3). Dr Machart’s certificate therefore remained “… conclusive evidence as to the matters certified in any court proceedings or in any assessment by the Commission in respect of the claim concerned”. (Emphasis added).

6. [22]

   After the dismissal of NRMA’s application, the claimant then proceeded to the claims assessment stage under the MAC Act.

7. [23]

   On 9 September 2020, a telephone conference was held by Claims Assessor Foggo with the parties' representatives. The claims assessor's report of that preliminary conference included the following comments:

8. [24]

   Counsel for Mr Wood, Mr Hart, placed great emphasis on what is recorded in that file note about the decision by NRMA not to pursue review of Dr Machart’s certificate any further. Mr Hart submitted that this position comprised an “admission” by NRMA that causation has been established generally in respect of Mr Wood’s back pathology, and that as a result there is an estoppel that prevents NRMA from arguing causation more generally has not been established. He argued that this is because of Dr Machart’s conclusion that the surgery was caused by the injuries sustained in the motor accident. Mr Hart submitted that the effect of the note made and the direction given by Mr Foggo was that the parties agreed that the only remaining medical dispute was “assessment of whole person impairment”.

9. [25]

   This interpretation of events betrays wishful thinking on the part of Mr Wood’s legal representatives, but it is a position not available at law. In any event, in its submissions to both the medical assessor dated 1 February 2021 and later in submissions to the PIC delegate in July 2021, NRMA made it clear via its solicitor that causation remained seriously in issue in regard to the s 58(1)(d) question of whole person impairment.

10. [26]

    In its February 2021 submissions, the solicitor for the NRMA denied liability on the basis that the claimant did not sustain any bodily injury in the subject accident. Under the heading “Dispute”, these submissions were made:

11. [27]

    The s 58(1)(d) dispute was referred to Dr Christopher Harrington for assessment to determine “the degree of permanent impairment under s 58(1)(d) of the Act”. Of necessity, this must include an assessment of the statutory question as posed namely: “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%”.

12. [28]

    On 11 June 2021, Dr Harrington issued a certificate under s 61(1) of the MAC Act:

13. [29]

    On 7 July 2021, the claimant applied to the President of the PIC to refer Dr Harrington’s medical assessment to a Review Panel for review.

14. [30]

    In written reply submissions provided by the solicitor for NRMA dated 28 July 2021, any suggestion of an “estoppel” applying to the determination of whole person impairment because the treatment dispute had been earlier determined, was strongly denied. It was argued that there was no requirement to refer to Dr Machart’s certificate in its submissions, noting that the causation findings of a treatment dispute do not bind any subsequent MAS assessment, citing Adamson J in Lithgow at [44].

15. [31]

    On 20 September 2021 a delegate of the President of the PIC determined that she was not satisfied that there was reasonable cause to suspect that the medical assessment was incorrect in a material respect, and so dismissed the application.

16. [32]

    In 2022 Mr Wood sought judicial review of the delegate’s decision in this Court. Following two days of hearing, Wright J decided that the delegate’s conclusion was incorrect as it had proceeded on at least two misconceptions, namely that Dr Harrington was required to form an opinion as to causation as well as degree of impairment when the only medical dispute referred to Dr Harrington was the degree of impairment as a result of the injuries accepted by the parties as having been caused by the motor accident; and that Dr Machart’s certificate in that regard, which had been accepted by the parties and was not challenged, was irrelevant. [1]

17. [33]

    His Honour held that as a result of these misconceptions, the delegate fundamentally misunderstood the task required to be performed when considering whether to be satisfied that there was reasonable cause to suspect that the medical assessment was incorrect. The question which the delegate addressed was whether it was open on the material before Dr Harrington to conclude that the injuries which gave rise to the treatment in April 2018 were not caused by the motor accident. Wright J held that this was incorrect, since the issue of causation was not in dispute, and that that issue had not been referred to Dr Harrington. Wright J decided that as a result of the misconceptions and in addressing the wrong question, the delegate failed to address the correct question, which was whether to be satisfied that there was reasonable cause to suspect that Dr Harrington’s medical assessment was incorrect in a material respect because he had based his certificate on his view that the relevant injury was not caused by the motor accident when that issue had not been referred to him for assessment.

18. [34]

    His Honour upheld the application for judicial review, and the matter was remitted to the PIC to arrange for Dr Harrington’s certificate to be referred to a review panel.

19. [35]

    Whilst there are strong reasons to doubt the correctness of Wright J’s conclusion on the basis set out by Schmidt J in Alliance Australia Insurance Ltd v Salucci [2023] NSWSC 1593 (“Salucci”), whether his decision was wrong or not does not change the fact that I must review the decision of the Review Panel. Although one of the grounds for review before me relates to Wright J’s judgment, it is a complaint that the Review Panel did not have sufficient regard to this decision when deciding they were required to assess causation afresh. Wright J’s decision cannot change what the statute provides, and was unfortunately based on a mistaken view of the prevailing situation where his Honour was not assisted with a contradictor or submissions that assisted him with binding Court of Appeal authority such as Mills which settled that issue with clarity to the effect that “a medical assessment of degree of permanent impairment without regard to causation from the motor accident has no statutory basis or function”. [2]

20. [36]

    On 21 May 2024 the Review Panel issued a Certificate with 38 pages of reasons on 21 May 2024, revoking the Certificate of Dr Harrington and certifying that Mr Wood’s whole person impairment as a result of the motor vehicle accident was 0%. The Review Panel concluded its reasons this way:

21. [37]

    The Review Panel also explained, by reference to the history of complaint and available spinal imaging, why it reached the conclusion that it did:

Mr Wood’s grounds for judicial review

1. [38]

   Mr Wood set out six argumentatively expressed grounds for review in his amended summons as follows:

2. [39]

   Unfortunately each one of them stems from a misunderstanding of the operation of the MAC Act and the fundamental requirement that a referral under s 58(1)(d) must always, inevitably, include an assessment of causation and that the previous treatment determinations were confined to the particular questions that were referred at that time.

Ground 1: Making a determination that the disc lesion and surgery were not caused by the motor accident - jurisdictional error

1. [40]

   Mr Hart submitted that in assuming it was entitled to ignore or displace the “no challenge” concession made by NRMA on 9 September 2020, the Review Panel misunderstood its remit and so made a determination that was ultra vires and that constituted jurisdictional error.

2. [41]

   Ms Gumbert submitted that the Review Panel was not deciding a dispute order s 58(1)(a) or (b) of the MAC Act, but the question of causation of the surgery was an integral part of the medical assessment matter the Review Panel was deciding under s 58(1)(d). For the reasons set out in Mills (amongst other authorities), the Review Panel needed to consider and assess causation as part of the completion of its statutory task. There was no error in assessing causation of the surgery in that context.

3. [42]

   I accept Ms Gumbert’s submissions. To properly evaluate causation as required under s 58(1)(d), it was necessary to consider the treatment course. The Review Panel were carrying out their statutory task properly and there was no error.

Ground 2: Invalidly assuming an entitlement to “set aside” the Certificate of Dr Machart - legally unreasonable and ultra vires

1. [43]

   As submitted by Ms Gumbert, this ground is based on a misconception of the effect of the Review Panel’s certificate. It did not “set aside” the certificate of Dr Machart. It formed its own view as to the separate medical assessment matter that had been referred to it in avoidance with its statutory duty.

2. [44]

   The Review Panel was not bound by Dr Machart’s decision on a different statutory question, but it was appropriate to, in carrying out its analysis of that question, refer to and explain its reasons as to why it formed the view it did, and that included explaining the reasons for its disagreement with Dr Machart’s conclusions about the causal link between the back surgery and the motor accident.

3. [45]

   I accept in full Ms Gumbert’s submission that any “concession” of causation by a party to proceedings, even if one was made, (and I do not accept any such concession was made), was irrelevant. Just as a finding on causation by a District Court Judge in Mills could not curtail the statutory task that the Review Panel in that case had to perform, neither could any purported concession by a party in this case curtail or change or limit the Review Panel’s task here. The Review Panel was required to complete its statutory function of determining the entire s 58(1)(d) question. Ground 2 fails.

Ground 3: Failing to observe the content and effect of the decision of Wright J - decision manifestly deficient and ultra vires

1. [46]

   Mr Hart alleged that the Review Panel failed in its statutory duty by not making reference to the decision of Wright J in Wood v Insurance Australia Group Limited trading as NRMA Insurance [2022] NSWSC 1290.

2. [47]

   Ms Gumbert disagreed, emphasising the observations of Schmidt J in Salucci at [74] that the hearing before Wright J was without a contradictor and his Honour was not provided with relevant binding authority which guides the approach that must be taken by a review panel: Mills, in which the Court of Appeal (Giles JA, Tobias JA and Handley AJA agreeing) held:

3. [48]

   As Schmidt J held in Salucci at [76] and [79]:

4. [49]

   Ms Gumbert submitted that Mr Hart’s reliance on the decision of Wright J must be rejected as it incorrectly placed restrictions on the scope of the fresh assessment to be conducted by the Review Panel, when no such restriction could ever be applied.

5. [50]

   I accept Ms Gumbert’s submissions. The Review Panel was required to carry out its own fresh assessment under s 58(1)(d) and did so. Ground 3 fails.

Ground 4: Failing to conclude consistently with Dr Machart that the L5/S1 surgery was caused by the motor accident, in circumstances where that certificate is final - legal unreasonableness

1. [51]

   Mr Hart argued that the Review Panel misunderstood and misapplied its delegated power by not coming to the same conclusion as Dr Machart that the L5/S1 surgery was “caused by” the motor vehicle accident. He submitted that the Review Panel decision was made contrary to an “unchallenged” medical assessment certificate, and is therefore legally unreasonable.

2. [52]

   As submitted by Ms Gumbert, this submission is misconceived. The Review Panel was required to form its own opinion on the medical assessment matter, which it did. The Review Panel had regard to Dr Machart’s decision and explained why it considered it was incorrect, and why it was not bound by it. This ground of review also fails.

Ground 5: Given the matters set out in Grounds 1-4, failing to apply itself to the real question to be decided - there was a failure to exercise statutory function under s 63 and so jurisdictional error

1. [53]

   Given the failure of grounds 1 to 4, I am not persuaded that there was any failure by the Review Panel to exercise its statutory function. On the contrary, I am satisfied it did so in a manner that was consistent with proper exercise of its statutory power and obligations. Ground 5 is without substance.

Ground 6: Given that the Review Panel’s findings as to the cause of the sciatica were based on credit, and so a non-medical determination, the Guidelines required that the Review Panel bring the report of Dr Machart to the attention of Mr Wood (and his lawyers) and seek explanation as to why that determination should be set aside and a contrary decision made, and the failure to do so created practical injustice and material prejudice and was procedurally unfair.

1. [54]

   Mr Hart submitted that Dr Harrington gave Mr Wood no reasonable opportunity to respond to Dr Harrington’s intention to “reject or ignore” the NRMA’s “no challenge to causation concession”, and that he planned to “ignore” Dr Machart’s “previous conclusions favourable” to Mr Wood on causation. Mr Hart submitted that Dr Harrington breached a “directive of clause 15(a) of the Code of Conduct” relating to procedural fairness.

2. [55]

   Mr Hart submitted that the Review Panel should have seen that the approach taken by Dr Harrington involved a practical injustice and acted accordingly to remedy this. Mr Hart submitted that the way to do this would have been for the Review Panel to find error on the part of Dr Harrington in his path of reasoning, (or absence of reasoning), when deciding an issue of “non-medical determination”, citing Rodger v De Gelder [2015] NSWCA 211 at [109].

3. [56]

   This ground of review is misconceived, and reliance on Rodger v De Gelder misplaced.

4. [57]

   As submitted by Ms Gumbert, in AAI Limited trading as GIO v Amos [2024] NSWCA 65, Adamson JA observed that the requirements of procedural fairness are quite different in the context of a review panel assessment when compared to a contested hearing. The rule in Browne v Dunn (1893) 6 R 67 cannot apply to the conduct of a medical examination by a medical assessor. Adamson JA also stated relevantly:

5. [58]

   The duty to afford procedural fairness did not impose an obligation on the Review Panel to put to Mr Wood that it was going to make a finding on causation adverse to him, or a finding that was different to the assessor Dr Machart. The argument made by Mr Hart misconceives the role of the Review Panel. It was not reviewing Dr Harrington’s decision in that sense. It was making its own fresh medical assessment, as s 63(3A) of the MAC Act required. The Review Panel exercised that function.

Materiality and discretionary refusal

1. [59]

   Given the Review Panel determined that Mr Wood’s current whole person impairment is 0%, any decision by it about the question of causation is immaterial. I accept the submission of Ms Gumbert that even if causation findings were made in Mr Wood’s favour, no useful result could ensue if the decision was quashed and the matter remitted. This is because the result of the examination of Mr Wood’s lumbar spine made by assessor Dr Harrington, and accepted by the Review Panel, was that there were no findings consistent with anything higher than DRE Category 1 impairment under the relevant guidelines, resulting in an assessment that Mr Wood’s whole person impairment was 0%.

2. [60]

   This would provide a basis to exercise my discretion to refuse the relief sought in the summons on the basis of futility, but there is no need to make such a finding given that I have rejected all the grounds for review.

Orders

1. [61]

   I make the following orders:

   1. (1)

      Pursuant to the Uniform Civil Procedure Rules 2005 (NSW) r 59.10(2), the time in which the plaintiff may commence these proceedings is extended up to and including 13 September 2024.

   2. (2)

      The proceedings be dismissed.

   3. (3)

      The plaintiff is to pay the costs of the first defendant.