Pham v NRMA Insurance Limited

1. [1]

   HER HONOUR: This is an application for judicial review of the decision of a medical assessor’s review panel.

2. [2]

   By summons filed 12 December 2014, the plaintiff seeks a declaration pursuant to s 69 of the Supreme Court Act 1970 (NSW) that the certificate and statement of reasons issued by the second defendant on 30 June 2014 and constituted by the third defendant is void and of no effect.

3. [3]

   The plaintiff is Jenny Pham (“Ms Pham”). The first defendant is NRMA Insurance Limited (“NRMA”). The second defendant is the Motor Accidents Authority of New South Wales (“the MAA”). The third defendant is a medical assessor’s review panel comprising Assessors Lewin, Mason and Parsonage (“the Review Panel”). The second and third defendants have filed submitting appearances. Ms Pham relied on the affidavit of her solicitor Michael Lawandi filed 10 March 2015.

4. [4]

   After judgment was reserved, senior counsel for Ms Pham requested that this matter be relisted. It was. Leave was given to Ms Pham to file further written submissions in relation to the application of Allianz Australia Insurance Ltd v Gonzales (2013) 65 MVR 286; [2013] NSWSC 362 to these proceedings, with a right of reply given to counsel for NRMA. I now have supplementary submissions from both parties.

Background

1. [5]

   On 14 October 2010, Ms Pham was injured in a motor vehicle accident. On 8 December 2010, Ms Pham was injured in a subsequent motor vehicle accident. This judicial review is in relation to the 8 December 2010 accident. In that accident, Ms Pham suffered minimal physical injury but developed a major psychiatric and/or psychological injury, diagnosed as a major depressive disorder.

2. [6]

   Under the Motor Accidents Compensation Act 1999 (NSW) (“the Act”), rights to damages for non economic loss for injuries caused by motor accidents were significantly modified from that which previously applied under the common law. Section 131 prohibits the awarding of damages for non economic loss unless the degree of whole person impairment (“WPI”) of the injured person is greater than 10%. The Act also requires that any dispute about whether the WPI meets the s 131 threshold is to be resolved by an assessment.

3. [7]

   As the parties could not agree as to whether or not Ms Pham’s WPI was greater than 10%, a medical assessment pursuant to s 60 of the Act was carried out. Medical Assessor Samuels (“the MAS Assessor”) determined that Ms Pham’s WPI caused by the 8 December 2010 motor accident was greater than 10%. NRMA applied for a review of the MAS Assessor’s decision. The Proper Officer referred the matter to the Review Panel. The Review Panel determined that Ms Pham’s major depressive disorder was not caused by the 8 December 2010 motor accident. NRMA now seeks judicial review of the Review Panel’s decision.

4. [8]

   The main issue raised before the Review Panel and on this judicial review was causation and, in particular, whether the case of Gonzalez applies to these circumstances.

The legislation

1. [9]

   Section 3A of the Act provides -

2. [10]

   Section 61 the Act relevantly reads:

3. [11]

   The decision of a MAS Assessor can be reviewed under s 63 of the Act. Section 63 relevantly reads:

4. [12]

   A review panel can also find guidance in the MAA Permanent Impairment Guidelines, 1 October 2007 (“the Permanent Impairment Guidelines”) and the MAA Medical Assessment Guidelines, 1 October 2008 (“the Medical Assessment Guidelines”). Both sets of guidelines may be characterised as delegated legislation under s 44(1) of the Act. They apply in respect of a motor accident occurring on or after 5 October 1999.

5. [13]

   Clause 16.21 of the Medical Assessment Guidelines refers to a Review Panel assessment. Clause 16.21 provides:

Causation

1. [14]

   Section 58 of the Act relevantly reads:

2. [15]

   Under s 58(1)(d), an assessment should determine the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident. An assessment of permanent impairment arising from an injury without a finding as to whether that injury was or was not caused by the subject motor accident has no statutory basis or function: see Motor Accidents Authority of New South Wales v Mills (2010) 78 NSWLR 125; [2010] NSWCA 82 at [61].

3. [16]

   Clauses 1.7, 1.8 and 1.9 of the Permanent Impairment Guidelines set out the test to be applied by a review panel when assessing causation under s 58(1)(d). Those clauses provide:

4. [17]

   In Ackling v QBE Insurance (Aust) Ltd (2009) 75 NSWLR 482; [2009] NSWSC 881, despite submissions from counsel that medical review panels were not qualified to determine issues of causation in addition to WPI assessments, Johnson J confirmed that review panels are authorised to determine causation. At [85]-[86], Johnson J pointed out that it should be kept in mind “that the assessment of the degree of permanent impairment of an injured person as a result of injury caused by a motor accident is to be undertaken by medical practitioners acting as medical assessors at first instance or as members of a review panel”. His Honour said the task of a review panel in assessing whether an injury was caused by the relevant accident is “a practical one”, and that it is “important that the process is not rendered unduly complex by legal terminology”. Johnson J commented at [87] that in undertaking the task of assessing causation, a review panel will derive practical assistance from clauses 1.7 to 1.9 of the Permanent Impairment Guidelines.

5. [18]

   In Owen v Motor Accidents Authority (NSW) (2012) 61 MVR 245; [2012] NSWSC 650, Campbell J at [27] agreed with Johnson’s approach in Ackling, but made a further comment concerning the use of s 5D of the Civil Liability Act 2002 (NSW) by a review panel. That passage reads:

6. [19]

   Hence, clauses 1.7 to 1.9 of the Permanent Impairment Guidelines must be read in conjunction with the common law, as modified by s 5D of the Civil Liability Act. Section 5D reads:

7. [20]

   The assessment of causation under s 5D involves two elements: “factual causation” under s 5D(1)(a) and “scope of liability” under s 5D(1)(b): Adeels Palace Pty Ltd v Moubarak (2009) 239 CLR 420; [2009] HCA 48 at [42]; Wallace v Kam (2013) 250 CLR 375; [2013] HCA 19 at [12]. Determination of factual causation under s 5D(1)(a) is a statutory restatement of the “but for” test: but for the negligent act or omission, would the harm have occurred (see Adeels Place at [45]). The determination of scope of liability under s 5D(1)(b) involves a value judgment, as does the determination of factual causation.

8. [21]

   There is a conflict between s 5D and clauses 1.7 to 1.9 of the Permanent Impairment Guidelines in that while s 5D(1)(a) mandates the use of the “but for” test, the Permanent Impairment Guidelines state that while the “but for” test may be useful in some cases, it “is not a definitive test and may be inapplicable in circumstances where there are multiple contributing causes”.

9. [22]

   Since Ackling and Owen, there has been confusion about the standard to be applied by a review panel when assessing causation, considering their lack of formal legal knowledge. Recently, in Peet v NRMA Insurance [2015] NSWSC 558, Hidden J was critical of allowing medical review panels to make decisions in relation to causation. His Honour remarked “one might question whether it would ever be appropriate for the normative judgment required by the Civil Liability Act s 5D(1)(b) to be made in the medical assessment process”.

10. [23]

    In AAI Limited v Motor Accidents Authority of New South Wales [2015] NSWSC 912, Button J was of the view that the standard of analysis for causation required from a review panel is lower than that that would be required from legally qualified persons. At [43]-[44] his Honour commented that:

11. [24]

    So while a review panel must take into account legal notions of causation (s 5D and the common law principles), it is also permitted to seek guidance in clauses 1.7 to 1.9 of the Permanent Impairment Guidelines (which does not necessitate the use of the “but for” test, but rather involves a determination of material contribution) and it is not strictly bound to apply the true legal test for causation.

The grounds of judicial review

1. [25]

   The grounds of review are that the statement of reasons and certificate issued by the Review Panel contain both jurisdictional error and/or error on the face of the record in that the Review Panel misdirected itself and misunderstood, and misapplied, the Act in respect of the definition of “injury” contained in s 3. Ms Pham submitted that the Review Panel did this by:

2. [26]

   Before I deal with each ground of review, it is necessary to set out the reasons and decision of the Review Panel, as well as analyse Gonzales.

The reasons and decision of the Review Panel

1. [27]

   On 30 June 2014, the Review Panel issued a certificate and statement of reasons. The Review Panel was comprised of Assessors Lewin, Mason and Parsonage. They are all psychiatrists. The MAS Assessor’s diagnosis of a major depressive disorder was not in dispute. The Review Panel focused on the issue of causation.

2. [28]

   Firstly, the Review Panel examined the history of the collision, including the conduct of the other driver in the immediate aftermath of the collision and the ensuing police investigation. This involved consideration of the medical records, including the general practice notes from Dr Cheung of Bankstown; an assessment of Ms Pham by Dr Powell, an orthopaedic surgeon, dated July 2011; the report of Dr Taylor, a psychiatrist, dated 2 September 2011; the documentation commencing August 2012 of psychologist Ms Sarkis who provided treatment to Ms Pham; the assessment by Community Mental Health Services dated October 2012 (that was of limited assistance); the report of Dr Samuell dated 5 November 2012 (but this report did not refer to the 8 December 2010 motor vehicle accident); and finally, the report of Dr Parmegiani, consultant psychiatrist, dated 16 May 2013.

3. [29]

   The Review Panel relied heavily on Dr Parmegiani’s report. That report included a summary of a statement provided by Ms Pham. The Review Panel stated:

4. [30]

   After reviewing the evidence, the Review Panel then set out its deliberations on causation. The Review Panel noted that both parties had provided submissions regarding the legal issues, particularly those in relation to the issue of causation. The Review Panel continued:

5. [31]

   The Review Panel accepted the explanation by Mr Parmegiani that Ms Pham’s psychiatric condition reportedly arose gradually and deteriorated over time during the period when the other party was aware of her address. Dr Parmegiani concluded that Ms Pham “developed fears of being hurt or persecuted by the other driver and her companion.” The Review Panel was of the opinion that, even accounting for prior vulnerability, the motor vehicle accident itself could not have given rise to such a severe psychiatric illness.

6. [32]

   Hence the Review Panel revoked the certificate issued by the MAS Assessor.

Consideration of Gonzales

1. [33]

   Since the Review Panel applied Gonzales, and it is contended by NRMA that Gonzalez is directly applicable to these circumstances, it is necessary to briefly set out the facts and reasoning in that decision.

2. [34]

   On 23 September 2008, Ms Carmen Gonzalez (“Ms Gonzales”) sustained some minor physical injuries from a motor vehicle accident at Warwick Farm railway station. She also claimed, as arising from the accident, to have sustained psychological injury that resulted from the conduct of Mr Phuc Cuong Dang, the other driver (“Mr Dang”) and his friends immediately following the accident and on the next day. Mr Dang’s insurer, Allianz Australia Insurance Ltd (“Allianz”), accepted liability in respect of the physical injuries but denied that any psychological injury was suffered from the accident itself. Rather, Allianz contended, that any such psychological harm was caused by separate events, thereby breaking the chain of causation and thus falling outside the scope of the Act.

3. [35]

   The issue of the cause of the psychological injuries was referred to the Medical Assessment Service. The claim was first assessed by Dr Lim, who found that Ms Gonzalez suffered psychological injuries which were caused by the accident. Allianz disputed Dr Lim’s findings and the matter was referred to the Proper Officer in accordance with s 63 of the Act. The Proper Officer upheld the assessment of Dr Lim. Allianz sought judicial review in this Court.

4. [36]

   In Gonzales at [5] Adams J set out the factual scenario:

5. [37]

   Adams J then analysed the law in relation to causation. At [21] to [24] his Honour stated:

6. [38]

   In summary, Adams J decided that the events after the motor accident comprised a novus actus interviens because they were materially temporally removed from the collision, and denied the satisfaction of the statutory concepts of “use or operation of the vehicle” and “is a result of and is caused… during” in s 3A. His Honour held that the driving of the vehicle did not cause the “dangerous situation” but that rather, that was caused by the decision of the driver to collect his friends and intimidate Ms Gonzales. He found that while there was faulty driving, “the psychological injuries to Ms Gonzales were not caused by that driving, that is to say, by ‘the use or operation of the vehicle’” (at [21]). Adams J at [26] decided that the conclusion was inevitable that Ms Gonzalez's psychiatric injuries did not satisfy the requirements of the Act.

(1) Did the Review Panel apply the correct test for causation?

1. [39]

   Senior counsel for Ms Pham submitted that the Review Panel’s path of reasoning shows that they did not sufficiently turn their mind to what the correct causation test to be applied was. Further, Ms Pham submitted that the Review Panel have, based on an incorrect interpretation of Gonzales, limited causation for the purposes of a motor accident inquiry to the actual collision or something attached to the vehicle, whereas a better approach is to break the accident down into four different phases. They are:

2. [40]

   Senior counsel for Ms Pham submitted that breaking down the accident into the above stages demonstrates that the exchange of particulars came under the definition of “use or operation of the vehicle” set out in s 3A of the Act, which distinguishes the facts in these current proceedings from those that underpin the Gonzales case. He submitted that the circumstances in Gonzales did not satisfy the statutory concept in s 3A of “use or operation of the vehicle” since the telephone calls and ensuing conduct by the Mr Dang and his friends were materially temporally removed in time from the collision and thus constituted a novus actus interviens. Further, senior counsel for Ms Pham said that what occurred in Gonzales had a much higher degree of separate criminality.

3. [41]

   According to senior counsel for Ms Pham, because the temporal reach of the legislation required Ms Pham to exchange particulars, unlike the circumstances in Gonzales, the confrontation in these circumstances between Ms Pham and the other driver was inexorably intertwined with the motor accident. Hence, he submitted that since the exchange of particulars caused the confrontation and loss of licence, which in turn caused Ms Pham’s major depressive disorder, there was no novus actus interviens.

4. [42]

   Counsel for NRMA referred to clause 16.21 of the Medical Assessment Guidelines, which set out the task of the Review Panel. She submitted that it had complied with these guidelines. Counsel also referred to clause 1.9 of the Permanent Impairment Guidelines, which states that “there is no simple common test of causation that is applicable to all cases”, but that rather “the accepted approach involves determining whether the injury (and the associated impairment) was caused or materially contributed to by the motor accident.” Counsel said the motor accident does not have to be a sole cause as long as it is a contributing cause, which is more than negligible, and suggested that (as outlined in the guidelines) although the “but for” test may be useful in some cases, it “is not a definitive test and may be inapplicable in circumstances where there are multiple contributing causes”. Therefore, the Review Panel were not required to do any more or less than what is defined in the guidelines.

5. [43]

   Counsel for NRMA submitted that the three specialists on the Review Panel were psychiatrists, not lawyers, and that the onus in regard to detailing legal argument in regard to causation proposed by Ms Pham was too high, and is not a requirement that they should have had to meet. NRMA submitted that consistent with Ackling, the Review Panel did not need to define s 5D of the Civil Liability Act or get into the complexities of the “but for” test. Counsel for NRMA argued that the Review Panel, having gone through a detailed analysis of the medical evidence, have formed an opinion about whether or not the motor vehicle accident resulted in the injury, and have satisfactorily completed their task.

6. [44]

   So far as Gonzales is concerned, counsel for NRMA submitted that it was “directly applicable” to these circumstances and applied correctly by the Review Panel. Counsel submitted that the Review Panel correctly identified an intervening event which broke the chain of causation. According to counsel for NRMA, the Review Panel applied the case of Gonzales to the facts in this case and accordingly decided that as in those circumstances, events that occurred after the accident were a break in the chain of causation. They did not articulate in legal detail why they had come to that decision with reference to the principles of novus actus interviens, but it was unnecessary for them to do so.

Conclusion

1. [45]

   Both Gonzales and the circumstances in this case required a determination of whether injury was caused by “the use or operation of the vehicle” or by some other factor. Both required an analysis of whether a confrontation following a motor accident fell within that definition. In Gonzales, the events which caused psychiatric damage occurred after the vehicles had stopped. The plaintiff had stepped out of her vehicle. There was no link between the faulty driving and the psychiatric damage. In Ms Pham’s case, the events which caused psychiatric damage also occurred after the vehicles had stopped. Ms Pham had stepped out of her vehicle to speak with the other driver.

2. [46]

   I accept that sometimes it is difficult to determine whether or not injury was caused in the “use or operation of a motor vehicle”. However, the closeness of the link between an incident and the driving must be “very substantial” in order to satisfy the requirements of predominance, immediacy and proximity: Gonzales at [24]. Dr Parmegiani’s report (Ex A, p 103) stated that it was “the subsequent interactions with the driver of the other car and her male passenger, who acted towards her in a physically aggressive way” and stole her driver’s licence which led to “Ms Pham develop[ing] fears of being hurt or persecuted by the other driver and her companion as, being in possession of her driver’s licence, they knew where she lived”. It was Dr Parmegiani’s opinion that it was during the period after the accident, where the police attempted to identify the other driver and her passenger, that Ms Pham “developed a gradual onset of depressive symptoms, which deteriorated over time and culminated into a diagnosis of Major Depressive Disorder”. In my view, the Review Panel was entitled to determine that that psychiatric injury was not caused by the fault of the other driver in the “use or operation” of a motor vehicle.

3. [47]

   Hence, the Review Panel did not err in limiting causation to the actual accident itself. Nor did the Review Panel err by not reaching the conclusion that there was a very substantial link between the motor vehicle accident and Ms Pham’s major depressive episode. Utilising common law principles (Gonzales) the Review Panel determined that the major depressive episode was not materially contributed to by the motor vehicle accident. Although the Review Panel did not refer specifically to s 5D and the “but for” test, it’s reasons demonstrate a detailed and practical assessment of whether the motor accident itself could have given rise to such a severe psychiatric illness. If on a strict legal analysis, the Review Panel’s reasons do not accord with the test set out in s 5D, they satisfy the test of material contribution set out in clauses 1.7 to 1.9 of the Permanent Impairment Guidelines.

4. [48]

   Further, the Review Panel’s reasons were adequate. Being medical assessors, not lawyers, they cannot be expected to provide reasons that expose detailed legal analysis. Relevant here is the well known statement of principle in Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; 185 CLR 259 at 271-272 where the plurality said:

5. [49]

   The Review Panel’s reasons should not be “construed minutely and finely with an eye keenly attuned to the perception of error”: Wu Shan Liang at 272. The principles relating to novus actus interviens are complex, and in the circumstances, the Review Panel did not misunderstand or misapply Gonzales, nor did it misdirect itself.

(2) The use of Dr Parmegiani’s report

1. [50]

   Ms Pham’s alternative submission was that the adoption of the Dr Parmegiani thesis, as the foundation for a negative causation finding, was a finding that was illogical, irrational and unreasonable, and was an irrelevant consideration. Senior counsel for Ms Pham submitted that since Dr Parmegiani had in fact made a positive causation finding, the selective use of Dr Parmegiani’s opinion as a foundation for a negative causation finding was an evidential misuse and distortion. He argued that in that sense, Dr Parmegiani’s opinion was not information and material that supported or was probative of a negative causation finding.

2. [51]

   Counsel for NRMA disagreed. Her position was that the Review Panel had set out in great detail Dr Parmegiani’s findings and explanation of events in their reasons for decision, and the proper characterisation of its use of the report is not that it distorted it and selectively used it, but that it utilised his clinical findings and explanation and, in agreeing with his conclusion that Ms Pham “developed fears of being hurt or persecuted by the other driver and her companion”, it added its own reasoning in determining the development of her condition, which was defensible and correct, lawful and open to it.

3. [52]

   Counsel for NRMA argued that further, while the Review Panel did place weight on the report of Dr Parmegiani, it was entitled to do so. Further, counsel said that the Review Panel also considered and specifically detailed in their reasons for decision several other significant pieces of evidence including submissions from the parties in relation to legal issues, the clinical notes of Ms Pham’s general practitioner, photographs of Ms Pham’s vehicle and the psychiatric report of Dr Diamond.

4. [53]

   In any event, NRMA’s submission was that the Review Panel provided an explanation as to why particular weight was placed upon the contemporaneous records. That was because “more recent accounts were accounts likely to be contaminated by other factors. Such factors might include the frailty of memory over a prolonged period of time, the impact of a depressive condition upon memory and the impact of multiple legal and medical interrogations”.

5. [54]

   It is my view that there was nothing illogical, irrational or unreasonable about the decision of the Review Panel to rely heavily upon the report of Dr Parmegiani. Dr Parmegiani had summarised the evidence of Ms Pham contained in her statement. The Review Panel simply came to their decision based on the medical evidence and records before them. They did not selectively use Dr Parmegiani’s opinion over other more relevant evidence. They used the contemporaneous records and provided an adequate explanation for putting less of an emphasis on more recent accounts. This ground of review fails.

6. [55]

   The result is that the application for judicial review fails. The summons filed 12 December 2014 is dismissed.

7. [56]

   Costs are discretionary. Costs usually follow the event. The plaintiff is to pay the first defendant’s costs on an ordinary basis as agreed or assessed.