Demonstrable and substantial injustice in threshold injury disputes

By Barbara Casado

Momand v Allianz Australia Insurance Limited [2023] NSWSC 1014

This recent decision of the Supreme Court of New South Wales provides guidance on how the Delegate of the President of the Personal Injury Commission (Delegate) is to determine whether an application for review of a medical assessment certificate is made within time and how threshold injury disputes are to be considered absent radiculopathy. In this article, we examine the case and its implications.

Background

Yama Momand (Momand) was involved in a motor vehicle accident on 19 January 2018 and brought a claim under the Motor Accident Injuries Act 2017 (NSW) (MAI Act). Allianz (Insurer) admitted breach of duty of care but determined that Momand had sustained threshold injuries^[1] only (dispute). The implication of this decision was that Momand was not entitled to weekly benefits after 26 weeks^[2] and common law damages were not payable.^[3] The dispute was referred to the Personal Injury Commission (PIC) for determination.

PIC decisions under review

The PIC allocated the dispute to Professor Ian Cameron (Assessor) and their decision was dated and issued on 24 July 2023. In short, the Assessor assessed cervical spine soft tissue injury only which, under the MAI Act, is a threshold injury. In coming to this decision, the Assessor found Momand did not suffer radiculopathy with reference to the definition contained in the Motor Accident Injuries Regulation 2017 (NSW) (MAI Regulation): ‘an injury to a spinal nerve root that manifests in neurological signs (other than radiculopathy) is included as a soft tissue injury.’

Momand sought review of the Assessor’s certificate under section 7.26 of the MAI Act, on the basis that the Assessor’s decision was incorrect in a material respect (application). The application was due to be lodged by 23 August 2022. Due to issues arising with the PIC Portal, Momand was unable to formally lodge an application and instead posted the submissions on the PIC Portal on the due date, with notice of the issues arising with the PIC Portal. Further attempts to formally lodge were made on 24 August 2022, however the application was successfully lodged on 26 August 2022.

The Delegate was allocated to consider Momand’s application. The issues for consideration were whether the:

• application for review was lodged within time and, if not, whether time to lodge should be extended under rule 133 of the Personal Injury Commission Rules 2021 (NSW) (PIC Rules); and
• Assessor failed to give reasons or adequate reasons for determining that the injury was a threshold injury, failed to have regard to the definition of threshold injury as it relates to spinal discs, and
• Assessor’s application of clause 5.9 of the Medical Assessment Guidelines exceed their authority.

The Delegate found against Momand. In their decision, the Delegate accepted the technical difficulties experienced by Momand when attempting to lodge the application on 23 August 2023 and had done all they could to comply. Despite this, the Delegate determined that time should not be extended as the ‘application does not have reasonable prospects of success’ which ‘mitigates any prejudice arising from the loss of opportunity to lodge the application’.

Further, the Delegate found that the Assessor had ‘provided sufficient reasons as to why the injuries met the definition of minor injury for the purpose of the medical assessment…’ despite the submissions that the Assessor, in restricting the assessment to whether radiculopathy was present, failed to properly consider the material before them, including of a ‘broad-based disc protrusion at C5/C6 [which] indents the ventral thecal sac. The…lumbar spine demonstrated a subtle broad-based disc bulge of the ventral sac’. Further, Momand contended that the Delegate failed to provide a clear path of reasoning in coming to their decision.

Issues

Momand sought judicial review on the following grounds:

1. 1. 1. the Assessor failed to give reasons or adequate reasons for determining that the injury to Momand’s neck and lower back were threshold injuries;
      2. the Assessor failed to have regard to the definition of threshold injury as it relates to spinal discs; and
      3. the Assessor applied clause 5.9 of the Medical Assessment Guidelines which is ultra vires (exceeded power of authority).

There was no contradictor to the summons as the Insurer, Delegate and President of the PIC filed submitting appearances.

Decision

Her Honour Associate Justice Harrison heard the matter and delivered judgment on 24 August 2023, granting the relief sought by Momand. Namely, the Delegate’s decision was set aside and the matter was remitted to the PIC to be dealt with according to law.

Lodgement of the application

Momand was successful on this point.

The Delegate ‘ought to have concluded the Application was lodged within time’^[4] and the usual review process should have been accepted, given: the PIC Rules provide that a document is lodged with the PIC when it is entered on the PIC’s information system, which was when the submissions were posted on the PIC Portal on 23 August 2023;^[5] and, nothing else could be done by Momand.^[6]

If the application for review was lodged late, the only question the Delegate needed to consider was whether to extend time under PIC Rule 133A, which ‘required [the Delegate] to take a broader view of the question of injustice than she took because she was not the decision maker on the substantive application…’^[7]

As for the test to be applied, her Honour Associate Justice Harrison stated as follows:

‘[56] The proper test is that if there was any prospect of the president being satisfied as to error in the certificate the delay caused substantial injustice because the effect of the certificate was to terminate the plaintiff’s rights to benefits of all types.
…
[59] In practical terms the delegate was required to ask whether if time for the application were not extended the plaintiff would suffer demonstrable and significant injustice, the test of which was whether it was open to think the President might have reasonable cause to suspect material error…’

Threshold injury – failure to give reasons

Momand was also successful on this point.

Her Honour Associate Justice Harrison referred to the well-established case law on the need for written reasons that show the Assessor’s actual path of reasoning in coming to decision^[8] and that, where there is more than one conclusion available to the Assessor (or review panel), an explanation for their preference of one over the other must be provided.^[9]

The Assessor, in finding that Momand did not suffer radiculopathy and therefore sustained threshold injury only, should have considered the alternate conclusion and explained why they did not consider the findings on the imaging reports to be outside the definition of threshold injury. Failing to do so constituted an error of law on the face of the record.

Application of the Guidelines

Her Honour Associate Justice Harrison also found in favour of Momand on this point, confirming that ‘the Guidelines cannot override the specific statutory provision which defined a rupture or partial rupture of cartilage to be a non-minor injury [and therefore] the extent it seeks to do so is ultra vires’.^[10] Momand’s injuries reported on the imaging were non-threshold injuries as discussed above, and the definition of threshold injury within the Guidelines could not overcome the definition at section 1.6 of the MAI Act.

Implications for CTP insurers

Both claimants and insurers can find comfort from this decision that, if they encounter difficulties with the PIC Portal, their application is lodged as long as all steps have been taken to do so, including a copy of the submissions being provided to the PIC whether by posting a message on the initial application or sending to the PIC via email. Furthermore, time to lodge an application should be extended if a demonstrable and substantial injustice would otherwise occur, such as disentitlement to all benefits and damages.

Where medical assessors fail to provide the actual path of reasoning in coming to their decision – including a failure to provide an explanation as to why a conclusion is preferred over another – the medical assessor will not have complied with their statutory duty and an application for review, if lodged, should be accepted and referred to the review panel.

This article was written with the assistance of Nick Zraika, Law Graduate.

[1] The terminology used in the dispute was ‘minor injury’, as the Insurer’s decision was issued prior to the Motor Accident Injuries Amendment Act 2022, however we have adopted the new language for ease of reference.
[2] The claim was lodged prior to the Motor Accident Injuries Amendment Act 2022 which increased the period weekly benefits were payable for threshold injuries from 26 weeks to 52 weeks under sections 3.11 and 3.28 of the Motor Accident Injuries Act 2017 (NSW) (MAI Act).
[3] Section 4.4 of the MAI Act.
[4] n 4 at [50]
[5] n 4 at [51] and [52]
[6] n 4 at [52]
[7] n 4 at [54]
[8] See Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480
[9] See Campbelltown City Council v Vegan [2012[ NSWSC 1577
[10] n 4 at [72]