Hunter v Insurance Australia Ltd trading as NRMA Insurance

By summons filed on 22 December 2020, John Hunter (the plaintiff) seeks relief pursuant to s 69 of the Supreme Court Act 1970 (NSW) in respect of a decision made by the Medical Review Panel, the third defendant (the Panel), on 30 September 2020. The substantive relief which the plaintiff seeks is that the decision of the Panel be set aside. The plaintiff also seeks an order that the matter be remitted to a differently constituted panel for determination in accordance with law. The summons was filed within the three-month period prescribed by the Uniform Civil Procedure Rules 2005 (NSW) (UCPR), r 59.10(1).

The first defendant, Insurance Australia Ltd trading as NRMA Insurance (the insurer); the second defendant, State Insurance Regulatory Authority (the Authority); and the Panel have each filed submitting appearances.

For the reasons which follow, I am satisfied that the plaintiff is entitled to the substantive relief claimed.

All references to legislation in these reasons are, unless otherwise stated, references to the Motor Accidents Compensation Act 1999 (NSW).

Section 44 of the Act relevantly provides that the Authority may issue guidelines with respect to the assessment of the degree of permanent impairment of an injured person as a result of an injury caused by a motor accident, the procedure for assessment and review of assessments, and the procedures for the referral of disputes for assessment or review of assessments. Part 3.4 of the Act provides for medical assessments. The term “medical assessment matters” is defined by s 57 as being any of the matters referred to in s 58. Of present relevance, s 58(1)(d) provides that “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%” is a medical assessment matter.

Section 61, which provides for the status of medical assessments, requires a medical assessor or panel to give a certificate as to the matters referred for assessment and the reasons, which is to be conclusive.

Section 63 provides for review of medical assessments, relevantly by a review panel, which may confirm the certificate of assessment of the single medical assessor or revoke that certificate and issue a new certificate as to the matters concerned.

Section 65(1) (now repealed, but in force at the relevant time) provided that medical assessments under Part 3.4 were “subject to relevant provisions of Motor Accidents Medical Guidelines relating to the procedures for the referral of disputes for assessment or review of assessments and the procedure for assessment.”

The Motor Accident Permanent Impairment Guidelines (the PI Guidelines) were issued under s 44(1)(c) of the Act. Clause 1.3 provides that the PI Guidelines apply to the assessment of the degree of permanent impairment that has resulted from an injury between 5 October 1999 and 30 November 2017. The plaintiff suffered injuries as a result of an accident during this period.

Clauses 1.5-1.7 of the PI Guidelines make provision for causation, as follows:

The plaintiff, who was born in 1969, was injured in a motor vehicle accident on 29 November 2016 while he was working as a traffic controller. As a result of the accident he sustained physical injuries, including to his left foot and leg.

On 9 February 2017, the plaintiff underwent surgery on his left foot at the Norwest Private Hospital. Following surgery, the plaintiff was given access to a patient-controlled analgesia device which he was encouraged to use to manage his pain. Some time later, the plaintiff woke in a room where he was informed that he had received an overdose of analgesia from the device, which had caused him to become unconscious and unresponsive. Defibrillator paddles were affixed to his chest. He was taken to the Intensive Care Unit where he was connected to various monitors. He suffered significant anxiety.

Ultimately, he made a claim for psychiatric injuries suffered as a consequence of what had occurred at the hospital as well as for the physical injuries he sustained in the accident.

His claim was referred for assessment under s 60 of the Act to Dr Virgona who found that there was no diagnosed psychiatric injury related to the motor vehicle accident. The plaintiff sought review of the decision. The Authority referred the matter to the Panel for review.

The Panel made findings in accordance with what I have set out above. It also found that the plaintiff was overly anxious when discussing the events in hospital and reluctant to speak in detail about what had occurred. On the one hand, he downplayed the nature of the event while, on the other, he described it as having destroyed his life. The Panel concluded that the plaintiff had suffered Post Traumatic Stress Disorder (PTSD) as a result of the incident at the hospital and noted the plaintiff’s belief that it occurred as the consequence of a medical error. The Panel’s key finding was that the motor vehicle accident did not cause the plaintiff’s PTSD because the PTSD was directly caused by the traumatic events at the hospital.

The Panel was obliged to apply the PI Guidelines with respect to causation which, as set out above, incorporated common law principles of causation. It is well established at common law that for there to be a causal link between a consequence and a cause it is not necessary that the consequence be a direct consequence of the cause as long as it is reasonably foreseeable. This principle is illustrated by Mahony v J. Kruschich (Demolitions) Proprietary Limited (1985) 156 CLR 522; [1985] HCA 37. In that case, a worker sued his employer for damages for personal injuries suffered by him in the course of employment. The employer cross claimed against the worker’s doctor, alleging that his negligent treatment of the worker had caused or contributed to the worker’s injuries and incapacity. The trial judge struck out the cross claim on the ground that it disclosed no reasonable cause of action. The Court of Appeal restored the cross claim. The doctor’s appeal to the High Court was dismissed.

The High Court (Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ) held that if a plaintiff acts reasonably in seeking medical treatment for injuries sustained as a result of negligence, and is further injured by the medical treatment, the original tortfeasor will be liable for the consequences of the medical treatment. The original injury is regarded as carrying some risk that medical treatment administered by reason of it will be negligently administered.

The principles of causation were also addressed in Bendix Mintex Pty Ltd v Barnes (1997) 42 NSWLR 307 in which Mason P described the approach of the common law on causation and said, of present relevance, at 317D-E:

Thus, if the common law test of causation is applied to the present case, the injury sustained by the plaintiff at the hospital, PTSD, can readily be seen to have been caused by the motor vehicle accident since it was a reasonably foreseeable consequence of the physical injuries sustained by the plaintiff in the accident that the plaintiff would undergo surgery in a hospital and be subject to the associated risks. It does not follow from the circumstance that the hospital might also be liable to the plaintiff in negligence, that the negligent driver who caused the motor vehicle accident did not also cause the PTSD sustained as a result of what happened in the hospital.

By requiring that the PTSD be a direct consequence of the motor vehicle accident, the Panel applied the incorrect legal test, since an indirect, but foreseeable consequence, was sufficient to establish causation. The application of the incorrect legal test, which is evident from the Panel’s reasons, amounts to an error of law on the face of the record since the reasons form part of the record, as they are required to be included in the certificate: s 61(9) of the Act.

Accordingly, the plaintiff is entitled to the substantive relief claimed.

The plaintiff also seeks an order that the Authority refer the matter to a differently constituted panel. I am not persuaded that such an order ought be made. The error made by the Panel was one of law and reflected an insufficient appreciation of the common law principles of causation. I am unable to discern any reasonable apprehension of bias, or any other reason, why the Panel as presently constituted would not be able to determine the matter fairly on remitter. As I have not heard the parties on this question, I grant liberty to apply on that matter.

As referred to above, each of the defendants filed a submitting appearance. The plaintiff, accordingly, does not seek costs.

For the reasons given above, I make the following orders: