Supreme Court New South Wales Medium Neutral Citation: AAMI Ltd v Ali [2012] NSWSC 969 Hearing dates: 13 July 2012 Decision date: 24 August 2012 Jurisdiction: Common Law Before: Beech-Jones J Decision: See [72] Catchwords: JUDICIAL REVIEW - Decisions of proper officers of Motor Accidents Authority - exercise of discretion - whether incorrect test applied - whether failure to take into account, failure to accord natural justice, or constructive failure to exercise jurisdiction - gloss on statutory test - costs. Legislation Cited: - Motor Accidents Compensation Act 1999 - Pt 3.4, s 44, s 60, s 61(1), s 61(2), s 61(4), s 62(1), s 63, s 94, s 92, s 94, s 95, s 107, s 108(1) s 131 - Supreme Court Act 1970 - s 69 Cases Cited: - Ackling v QBE Insurance (Australia) Ltd [2009] NSWSC 881; 75 NSWLR 482 - Allianz Australia Insurance Ltd v Cervantes [2012] NSWCA 244 - Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; 77 ALJR 1088 - Minister for Immigration and Citizenship v SZGUR [2011] HCA 1; 241 CLR 594 - Minister for Immigration and Ethnic Affairs v Wu Shan Liang [1996] HCA 6; 185 CLR 259 - Minister for Immigration and Multicultural Affairs, Re; Ex parte Miah [2001] HCA 22; 206 CLR 57 - Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 - Owen v Motor Accidents Authority (NSW) [2012] NSWSC 650 - Plaintiff M61/2010E v Commonwealth of Australia [2010] HCA 41; 243 CLR 319 - Refugee Review Tribunal, Re; ex parte Aala [2000] HCA 57; 204 CLR 82 - Trazivuk v Motor Accidents Authority of New South Wales [2009] NSWSC 1074 - Trazivuk v Motor Accidents Authority of New South Wales [2010] NSWCA 287 Category: Principal judgment Parties: AAMI Limited (Plaintiff) Abbas Ibrahim Ali (First Defendant) Motor Accidents Authority of New South Wales (Second Defendant) David Ford (Third Defendant) Representation: Counsel: M.A. Robinson SC, Mrs A. Poljak (Plaintiff) Ms S. Norton SC, Ms L. Goodchild (First Defendant) Solicitors: Moray & Agnew Lawyers (Plaintiff) Brydens Compensation Lawyers (First Defendant) Crown Solicitor's Office (Second Defendant - Submitting appearance) File Number(s): 2012/099666 Judgment 1On 13 November 2006 the first defendant, Mr Ali, was injured in a motor vehicle accident. The plaintiff, AAMI Ltd ("AAMI"), was the insurer of the vehicle Mr Ali claims caused the accident. In accordance with the Motor Accidents Compensation Act 1999 (the "MAC Act") Mr Ali has made a claim for compensation which has been referred to a "claims assessor" (also known as a Claims Assessment and Resolution Service Assessor, "CARS assessor"). Mr Ali has also been the subject of medical assessment under the MAC Act. A number of certificates have been issued under the MAC Act concerning the injuries he suffered as a result of that accident and his consequential level of whole person impairment. 2AAMI seeks judicial review of two decisions made by a "proper officer" (as defined by s 62(1B) of the MAC Act) of the Motor Accidents Authority (the "MAA"), one denying AAMI a further medical assessment of Mr Ali's neurological injuries and the other denying it a review of a certificate concerning those injuries by a medical review panel. It also seeks judicial review of a decision of the CARS assessor to not seek a further medical assessment of Mr Ali's neurological injuries. Motor Accidents Compensation Act 1999 Medical Assessments and Proper Officers 3Part 3.4 of the MAC Act provides a scheme for the resolution of disagreements between claimants and insurers about, inter alia, 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%". This is a threshold which an injured person must overcome before they can recover damages for non-economic loss (s 131). 4These disagreements ("medical disputes") may be referred to the MAA by a party, court or claims assessor. The MAA will then refer the dispute to one or more "medical assessors" (s 60). Medical assessors are required to give a "certificate" as to the matter referred for assessment (s 61(1)). The 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 the certificate in limited circumstances (s 61(4)). 5Section 62 provides a means for obtaining a further assessment from a medical assessor. Section 63 provides for the review of a medical assessment by a review panel of assessors. Given their significance to this case, it is necessary to set out these provisions: "62 Referral of matter for further medical assessment (1)A matter referred for assessment under this Part may be referred again on one or more further occasions in accordance with this Part: (a)by any party to the medical dispute, but only on the grounds of the deterioration of the injury or additional relevant information about the injury, or (b)by a court or claims assessor. (1A)A matter may not be referred again for assessment by a party to the medical dispute on the grounds of deterioration of the injury or additional relevant information about the injury unless the deterioration or additional information is such as to be capable of having a material effect on the outcome of the previous assessment. (1B)Referral of a matter under this section is to be by referral to the member of staff of the Authority who is designated by the Authority for the purpose (in this Part referred to as the proper officer of the Authority). (2)A certificate as to a matter referred again for assessment prevails over any previous certificate as to the matter to the extent of any inconsistency. 63 Review of medical assessment by review panel (1)A party to a medical dispute may apply to the proper officer of the Authority to refer a medical assessment under this Part by a single medical assessor to a review panel of medical assessors for review. (2)An application for the referral of a medical assessment to a review panel may only be made on the grounds that the assessment was incorrect in a material respect. (2A)If a medical assessment under this Part (a combined certificate assessment) is based on the assessments of 2 or more single medical assessors (resulting in a combined certificate as to the total degree of permanent impairment), the combined certificate assessment cannot be the subject of review under this section except by way of the review of any of the assessments of the single medical assessors on which the combined certificate assessment is based. (3)The proper officer of the Authority is to arrange for any such application to be referred to a panel of at least 3 medical assessors, but only if the proper officer is satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect having regard to the particulars set out in the application. (3A)The review of a medical assessment is not limited to a review only of that aspect of the assessment that is alleged to be incorrect and is to be by way of a new assessment of all the matters with which the medical assessment is concerned. (4)The review panel 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. (5)If on the review of a medical assessment of a single medical assessor on which a combined certificate assessment is based a new certificate is issued by the review panel, the review panel is also to issue a new combined certificate to take account of the results of the review. (6)Section 61 applies to any new certificate or new combined certificate issued under this section. (7)The MAA Medical Guidelines may limit the time within which an application under this section may be made." 6Both s 62 and s 63 assign a role to a "proper officer" of the MAA in relation to applications for further assessments and review of assessments. Thus, s 63(3) establishes as a pre-condition to there being any referral to a review panel that the relevant proper officer is "satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect having regard to the particulars set out in the application" for referral to a review panel. 7Sub-section 62(1B) designates a similar role for proper officers in relation to a request by a party to a medical dispute for a further assessment. The section is awkwardly expressed, in that it refers to a "matter under this section is to be by referral to" the proper officer. The reference to a "matter under this section" is not a reference to the further assessment, but to the application by the party for the further assessment. Thus, where a party refers the matter for further assessment it is the function of the proper officer to consider the criteria in s 62(1A). In the circumstance were a matter is referred for further assessment under s 62(1)(b) by a court or claims assessor then the proper officer has only a very limited role (see Trazivuk v Motor Accidents Authority of New South Wales [2009] NSWSC 1074 at [32] per Patten AJ). 8Section 44 of the MAC Act empowers the MAA to issue guidelines, known as MAA Medical Guidelines, with respect to, inter alia, the "assessment of the degree of permanent impairment of an injured person as a result of an injury caused by a motor accident" (s 44(1)(c)) and the "procedures for the referral of disputes for assessment or review of assessments and the procedure for assessment and review of assessments under, Pt 3.4" (s 44(1)(d)). Although described as "Guidelines", documents issued by the MAA under this section are properly described as delegated legislation (see Ackling v QBE Insurance (Australia) Ltd [2009] NSWSC 881; 75 NSWLR 482 at [83] per Johnson J). 9Guidelines have been issued by the MAA under s 44(1)(c) ("the Permanent Impairment Guidelines") and s 44(1)(d) ("the Medical Assessment Guidelines"). Amongst other matters, the Medical Assessment Guidelines impose a limited obligation upon proper officers exercising power under s 62 and s 63 to give reasons. Thus in relation to s 62, clause 14.8 of the Medical Assessment Guidelines provides: "The Proper Officer is to provide the parties with brief written reasons for the decision at the same time as, or as part of the notification to the parties, of the outcome of the Allocation Review as required by clause 9.2." (emphasis added) 10In relation to s 63, clause 16.15 of the Medical Assessment Guidelines provides: "The Proper Officer shall advise the parties as to whether the application is accepted and will be referred to a Review Panel or is dismissed, supported by a brief statement of reasons, within 5 days of considering the application." (emphasis added) 11In challenging decisions by a proper officer under each of s 63(3) and s 62(1A), AAMI invokes the supervisory jurisdiction of this Court as confirmed by s 69 of the Supreme Court Act 1970. For each of those decisions, AAMI contends that it has established a jurisdictional error or an error of law on the face of the record on the part of the relevant proper officer in the manner discussed below. A "proper officer" is neither an inferior court or tribunal. Nothing in the MAC Act suggests that they are conferred with any authority or jurisdiction to decide any question of law. Thus it follows that if AAMI is able to establish an error of law on the part of the proper officers of the kind it asserts, as opposed to an incorrect decision on the merits, then it will have established invalidity. CARS assessment 12Part 4 of the MAC Act deals with claims by injured persons. Part 4.2 makes provision for such persons to lodge claims. Part 4.3 imposes a number of duties upon insurers and injured persons in respect of such claims. Part 4.4 deals with claims assessment and resolution. Division 1A of Pt 4.4 provides a scheme for the exchange of documents and settlement offers prior to referral for assessment. If this process is unsuccessful, s 90 enables a claim to be referred to the MAA for assessment under Pt 4.4 on application by either the claimant or an insurer. Section 92 specifies that certain claims are exempt for the assessment process. If it is not engaged, the "Principal Claims Assessor" makes arrangements for its assessment by a "claims assessor" (s 93). 13 The function of a claims assessor is specified in s 94 as follows: "Assessment of claims (1)The claims assessor is, in respect of a claim referred to the assessor for assessment, to make an assessment of: (a)the issue of liability for the claim (unless the insurer has accepted liability), and (b)the amount of damages for that liability (being the amount of damages that a court would be likely to award). (2)Such an assessment is to be made having regard to such information as is conveniently available to the claims assessor, even if one or more of the parties to the assessment does not co-operate or ceases to co-operate. (3)The assessment is to specify an amount of damages. (4)The claims assessor must, as soon as practicable, after an assessment issue the insurer and claimant with a certificate as to the assessment. (5)The claims assessor is to attach a brief statement to the certificate, setting out the assessor's reasons for the assessment. (6)If the Principal Claims Assessor is satisfied that a certificate as to an assessment or a statement attached to the certificate contains an obvious error, the Principal Claims Assessor may issue, or approve of the claims assessor issuing, a replacement certificate or statement to correct the error." 14The status of any such assessment issued by a CARS assessor is addressed in s 95, which provides: "Status of assessments (1)An assessment under this Part of the issue of liability for a claim is not binding on any party to the assessment. (2)An assessment under this Part of the amount of damages for liability under a claim is binding on the insurer, and the insurer must pay to the claimant the amount of damages specified in the certificate as to the assessment if: (a)the insurer accepts that liability under the claim, and (b)the claimant accepts that amount of damages in settlement of the claim within 21 days after the certificate of assessment is issued. Note. If the amount of damages is not accepted by the claimant within that period, section 151 makes provision with respect to liability for legal costs incurred after the certificate of assessment was issued. (2A)The amount of damages payable by an insurer (including any costs assessed as payable by the insurer) must be paid within such period as may be prescribed by the regulations and the regulations may require the payment of interest on so much of the amount payable as is from time to time unpaid after the end of that period. The rate of interest may be set by reference to the rate of interest prescribed for the purposes of section 101 of the Civil Procedure Act 2005 but may not exceed that rate. (3)It is a condition of an insurer's licence under Part 7.1 that the insurer complies with this section." 15The effect of s 95(2) is that in a case where the insurer accepts liability and a CARS assessor makes an assessment of the amount of damages in respect of that liability, then the claimant can accept that amount and the award is binding upon the insurer. This is reinforced by s 95(3) which imposes a condition of the insurer's licence that they comply with that determination. 16Part 4.5 of the MAC Act deals with court proceedings in respect of claims. Section 107 allows proceedings in respect of a claim to be taken in any court of competent jurisdiction. This is subject to s 108(1) which prevents a claimant from commencing such proceedings unless a certificate of exemption under s 92 has been granted, or a claims assessor has issued a certificate under s 94 (i.e. completed their assessment). It otherwise assumes that s 95 has not been engaged to bring about a binding determination. 17As I have stated, s 62(1)(b) confers upon both a court and a claims assessor a discretion to refer a matter for further medical assessment. This power is exercised in the context of s 94, in the case of a claims assessor, and s 107 to s 108 in the case of a court. Background to the First Decision 18On 7 May 2008 an "Application for Assessment of a Stabilisation and/or Permanent Impair Dispute by the Medical Assessment Service" form was lodged on Mr Ali's behalf ("Form 2A"). The application was withdrawn and a further application was lodged on 28 July 2008. AAMI lodged its reply on or about 7 August 2008 ("Form 2R"). 19On 25 September 2008 the MAA wrote to the parties advising that the matter would be assessed in accordance with the "MAAS Protocol for the Assessment of Brain Injury" and advising that appointments had been made for Mr Ali to see a neurologist (Dr Lethlean), an ear, nose and throat specialist (Dr Brian Williams) and a psychiatrist (Dr Robert Lewin). 20On 9 December 2008, Dr Lethlean certified that three areas of injury to Mr Ali caused by the motor accident had stabilised, namely, head (severe head injury), back (musculo-ligamentous contusion) and right shoulder (fractured clavicle). Dr Lethlean stated that they gave rise to a whole person impairment which was greater than 10%. 21On 22 January 2009, Dr Williams certified that damage to Mr Ali's eighth cranial nerve, with deafness and tinnitus, had stabilised and that the whole person impairment arising from that accident was not greater than 10%. 22By a certificate dated 4 February 2009, an assessor determined that the combination of the assessments by Dr Lethlean and Dr Williams produced the result that Mr Ali had a combined whole person impairment of 18%. 23The psychiatrist, Dr Lewin, issued a certificate on 23 February 2009. In an accompanying report, Dr Lewin concluded that in the period following the motor vehicle accident Mr Ali showed evidence of post-traumatic stress disorder and diagnosed him as having developed a major depressive disorder. Dr Lewin recorded that his pre-existing whole person impairment was 0%, and that his whole person impairment due to the motor vehicle accident was 26%. Dr Lewin certified that Mr Ali had suffered injuries caused by the accident which had stabilised, namely major depressive disorder and post-traumatic disorder and that they gave rise to a whole person impairment which was greater than 10%. 24On or about 5 August 2010, AAMI lodged a document entitled "Application for Further Assessment of a Permanent Impairment Dispute by the Medical Assessment Service". This form sought to invoke s 62(1)(a) of the MAC Act in respect of Mr Ali's psychiatric and neurological injuries. A significant amount of material was provided in support of that application. Mr Ali had been an officer in the Iranian army and had come to Australia as a refugee. The material included material reporting on his condition upon his arrival in Australia. 25On or about 30 March 2011 the proper officer determined that there would be a further assessment of Mr Ali's head, back, right shoulder and psychiatric injuries but not the damage to his cranial nerve which involved deafness and tinnitus. Accordingly, further appointments were made for him to see Dr Lewin and another neurologist, Dr Fitzsimons. 26Dr Fitzsimons issued a certificate dated 1 June 2011. Dr Fitzsimons assessed Mr Ali as having suffered injuries to his head, back and right shoulder from the motor accident which gave rise to a whole person permanent impairment of 17%. I discuss Dr Fitzsimons' report in detail below. A further certificate concerning those injuries and Mr Ali's cranial nerve damage was issued on 15 June 2011 certifying that he had a combined whole person permanent impairment of 20%. The first decision 27On or about 20 July 2011, AAMI lodged a document entitled "Application for Review of a Medical Assessment by the Medical Assessment Service" (MAS Form 5A). AAMI sought the referral of Dr Fitzsimons' assessment to a review panel of medical assessors pursuant to s 63 of the MAC Act. Its submission complained that Dr Fitzsimons' report was said to have been based substantially on Mr Ali's "subjective complaints" which AAMI contended were not credible. 28On 2 August 2011 Dr Lewin provided a further certificate following the referral back to him of so much of the dispute as concerned psychiatric issues pursuant to s 62(1)(a) of the MAC Act ("Dr Lewin's second report"). Dr Lewin accepted that Mr Ali was suffering from post-traumatic stress disorder, but concluded that it was not caused by the motor accident. Instead he concluded that it arose as a result of his military service, subjection to torture, prolonged imprisonment, and separation from his family prior to arriving in Australia. 29Dr Lewin's second report prompted AAMI's solicitors to provide further submissions to the proper officer on 7 September 2011. The submissions drew the proper officer's attention to Dr Lewin's second report. The submissions set out passages from Dr Lewin's report in which Dr Lewin referred to the inconsistencies in Mr Ali's history and stated that "any formal assessment of impairment which relies upon [Mr Ali's account] is meaningless". The submission included the following: "The insurer has sought a review of Assessor [Fitzsimons'] determination dated 1 June 2011, on the basis that a number of inconsistencies and concerns were noted by Assessor Fitzsimons during the course of her assessment of the claimant, however proceeded to assess the claimant's level of whole person impairment on the basis of his subjective complaints. ... Noting the findings of Assessor Lewin, the insurer submits his determination provides further support for its contention that an assessment of whole person impairment in relation to the claimant's alleged brain injury cannot be undertaken on the basis of the claimant's subjective complaints given the inconsistencies noted in his provision of histories and the records provided, and accordingly the application for review should be accepted." (emphasis added) 30On 8 September 2011 an MAA officer advised AAMI that their submission had been received and that: "The Proper Officer will consider the issues raised in your correspondence at the time of their determination." 31On 25 October 2011, the proper officer declined AAMI's application under s 63(1) of the MAC Act. The proper officer's reasons are just over three pages in length. The reasons summarise AAMI's submission concerning Assessor Fitzsimons' report that "notwithstanding a number of inconsistencies on examination and in the documentation provided, the Assessor proceeded to assess the claimant's level of whole person impairment on the basis of his subjective complaints", and that the "claimant's subjective complaints cannot be believed and cannot be utilised for the purposes of an assessment of a whole person impairment". 32Under the heading "Reasons for Decision" the proper officer referred to parts of Assessor Fitzsimons' report and then continued: "13. It is evident that the Assessor [Dr Fitzsimons] was then confronted with two competing positions. Namely, the unreliability of the cognitive test results versus the very severe head injury sustained in the accident. 14. The Assessor, after examining the claimant and reviewing all the available evidence chose to find the latter position, namely that the claimant sustained a head injury and thereby satisfying the criteria in clause 5.9. Her reasons are clearly stated in paragraph 3, page 15. 15. The Assessor then applied Clinical Dementia Rating (CDR) and found a CDR of 1.0 which falls within the 15-29% WPI category. I note that the applicant does not take any specific issue with how the Assessor rated each of the CDR categories namely Memory, Orientation and the like. Rather, the applicant says the claimant should be assessed at the lower range because the claimant's subjective reports cannot be accepted. 16. I am not persuaded by the applicant's submissions. This is not a case where it is alleged that the Assessor has failed to consider relevant information or incorrectly applied certain requirements in the guidelines. This is a case where the Assessor has documented in her report careful consideration of all relevant issues, including the insurer's position regarding the alleged inconsistencies contained in the medical reports. However it is evident that the Assessor has provided reasons as to why she was satisfied that there was a head injury which warranted an assessment under the CDR scale. 17. I have also noted the applicant's disagreement with the quantum of the assessment, namely 15% WPI. ... Conclusion 18. The result being, as to this review application, I am not satisfied that there is reasonable cause to suspect that the medical assessment was incorrect in a material respect. 19. The review application is dismissed. 20. In considering this application, I have taken into account the following:  The 5A application and 5R reply forms and supporting documentation;  The certificate including the reasons issued by Assessor Fitzsimons, the application for assessment, the response and all the document provided prior to her assessment;  Section 63(3) and section 133(2) of the Act; and  The Motor Accidents Authority Permanent Impairment Guidelines - Guidelines for the assessment of permanent impairment of a person injured as a result of a motor vehicle accident 1 October 2007 (the 'MAA Guidelines'), the Medical Assessment Guidelines 1 October 2008, and the American Medical Association Guides to the Evaluation of Permanent Impairment, 4th edition, 3rd printing (the 'AMA Guides')." (emphasis added) First Decision - grounds of review 33AAMI makes two complaints of the relevant form of error on the part of the proper officer. 34First, AAMI contends that the proper officer erred in law in that in paragraph 16 of his reasons he stated that he was not "persuaded" by AAMI's submissions. It was said that this involved the application of an incorrect legal test in that s 63(3) only requires the proper officer to be satisfied that there is "reasonable cause to suspect that the medical assessment was incorrect in a material respect", etc. It is submitted that to implicitly state that he had to be "persuaded", the proper officer imposed an unwarranted gloss on the test posed by s 63(3). 35There is no substance in this complaint. On any fair reading of the proper officer's reasons the reference to their being "persuaded" in [16] is a reference to being persuaded that the criteria in s 63(3) was established. Section 63(3) requires the proper officer to be "satisfied" that there was "reasonable cause to suspect". There is no relevant difference in this context between being "persuaded" and being "satisfied". In paragraph [18] of his reasons, the proper officer answered the precise question raised by s 63(3). In paragraph [4] of his reasons, the proper officer set out the correct test posed by s 63. In my view there is no basis for suggesting that between those two paragraphs the proper officer somehow deviated from the correct test (see Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259). 36Second, AAMI complains that, although it furnished to the proper officer a copy of Assessor Lewin's medical assessment which was highly relevant to its application, the proper officer failed to have regard to it in applying the test in s 63(3). During argument, the formulation of the error was expanded to include either a failure to accord natural justice or a constructive failure to exercise jurisdiction on the part of the proper officer, in that AAMI submits that the proper officer did not truly address the basis for its application under s 63(1), especially its reliance on Dr Lewin's second report. 37To address this, it is necessary to further consider Dr Fitzsimons' report. Dr Fitzsimons was provided with a substantial amount of material, including that which had been provided by AAMI's solicitors in support of their further application for medical assessment lodged in August 2010. She referred to this material in some detail. Dr Lewin also described Mr Ali as a "poor historian". 38Under the heading "Conclusions" Dr Fitzsimons referred to Mr Ali as having sustained "a severe head injury with extradural haematoma and temporal bone fractures". She noted that the presence of the extradural haematoma and the duration of the post-traumatic amnesia as reported by Mr Ali are "not an accurate predictor of ultimate prognosis", but also noted that the "absence of a radiological scan evidence of residual brain parenchymal damage does not necessarily mean that there have been no long term consequences of such trauma". In relation to his back Dr Fitzsimons stated that it was "open to question as to whether or not [Mr Ali] did sustain a lumbar spine injury" and noted that with his right shoulder he suffered a fractured clavicle. 39Under the heading "Determination", Dr Fitzsimons stated: "For the reasons canvassed in the insurer's submissions, which were accompanied by three psychological/psychiatric assess-ments indicating that cognitive test results could in no way be considered reliable, and given the earlier functionality reported from the hospital outpatient etc reports recorded in the documentation, I do not consider the psychological tests reported have a reliability in relation to cognitive dysfunction. Similarly, it is simply not possible to sort out how much of his depression/post-traumatic stress disorder [which is best assessed by a psychiatrist] is pre-existing, in relation to his torture and undoubtedly severe emotional traumas in Iraq and subsequently during his boat ride to Australia. On the other hand, it is also undoubtedly true that he sustained a very severe head injury with multiple fractures and an extradural haematoma, with what was diagnosed as damage to the right 7th and 8th cranial nerves [subject to separate assessment]. Such situations of uncertainty mean that a best estimation of WPI must be made on the balance of probability, taking all factors into account. Given the severity of the head injury, I consider it plausible, and indeed probable, albeit for the reasons indicated above, by no means certain, that some degree of cognitive impairment and/or emotional/behavioural disturbance [other than that which might be attributed to 'psychiatric' and/or pre-existing factors] would exist, consequent upon the injury. I consider such impairment likely to be small (on probability); this is principally because of the lack of any or marked changes evident on later brain imaging, and because of the early recovery reported while he was in hospital and/or shortly thereafter." Under such circumstances, the CDR scale is also difficult to apply. Prima facie the calculation would be as follows: [Dr Fitzsimons then set out various scores Mr Ali received as memory, orientation, judgment and problem solving, community affairs, home and hobbies and personal care.] ... This results in a CDR of 1.0 [15-29% WPI]. It would be reasonable to assess as 15% WPI within this range, especially as I am not convinced that all of the above scores necessarily reflect brain damage - although they might reflect depression whether or not due to the accident. I considered whether or not to decrease this assessment in the light of para 1.42 MAA Guidelines, but concluded that, in the presence of the uncertainties in this case, 15% WPI was a reasonable reflection of impairment which might result from an extradural haematoma with fractures. I did not consider that 'emotion/behavioural consequences due to brain damage would, on probability, exceed this figure. ... WPI due to brain injuries is therefore 15%. ..." 40There was significant debate before me as to the proper interpretation of these reasons. AAMI contended that they disclose that Dr Fitzsimons relied on Mr Ali's recitation of his history and subjective complaints. I disagree. Dr Fitzsimons accepted that there was a likelihood that there were pre-existing psychiatric impairments. Dr Fitzsimons was very much aware of the difficulties involved in assessing Mr Ali's level of whole person impairment based upon either the history given by Mr Ali, or any cognitive testing relying upon Mr Ali's responses to various questions. Thus, Dr Fitzsimons determined Mr Ali's level of impairment by starting with the objective evidence of the nature of Mr Ali's injuries, and then used her clinical experience to infer what types and degree of impairment were likely to have resulted from that level of injury. This resulted in her concluding that his level of whole person impairment was in the range 15% to 29%. Dr Fitzsimons adopted a figure at the bottom of that range to allow for uncertainties due to the possibility of pre-existing conditions ("reflect depression whether or not due to the accident"). Thus, contrary to AAMI's submissions, Dr Fitzsimons' reasoning did not involve any reliance on Mr Ali's history or his "subjective complaints". 41The proper officer construed Dr Fitzsimons' report in the same manner. Thus in [13] of his reasons, the proper officer noted that Dr Fitzsimons was aware of the unreliability of the cognitive tests and in [16] to [18] the proper officer noted the "insurer's position regarding the alleged inconsistencies contained in the medical reports". Yet, according to the proper officer, "it is evident that the Assessor has provided reasons as to why she was satisfied that there was a head injury that warranted an assessment under the CDR scale". In so stating, the proper officer was referring to the reasons of Dr Fitzsimons that I have extracted above. As I have described, those reasons did not involve any reliance upon Mr Ali's inconsistent history, subjective complaints or any cognitive testing that relied on his responses. Thus the proper officer was not satisfied that there was reasonable cause to suspect that Dr Fitzsimons' medical assessment was incorrect in a material respect by reason of the unreliability of Mr Ali as a historian. This was because Mr Ali's recitation of that history and his subjective complaints did not play any part in the chain of reasoning that led to Dr Fitzsimons determining his level of impairment arising from the accident. 42This also had the consequence that there was no relevant inconsistency between Dr Lewin's second report and that of Dr Fitzsimons. Both accepted that any assessment based upon Mr Ali's account of his symptoms and functioning prior to the accident was, in the words of Dr Lewin, "meaningless". In the case of the former this meant that there was no proper basis to attribute to any impairment to any psychiatric condition arising out of the accident. However, in the case of the latter, there was such a basis, namely the objective evidence of the head injuries he suffered and Dr Fitzsimons' assessment of the usual level of impairment that resulted from injuries of that kind. 43Senior Counsel for AAMI, Mr Robinson SC, placed particular emphasis on the contrast between the psychiatric impairment rating scores given to Mr Ali by Dr Lewin compared with the clinical dementia rating ("CDR") scores given by Dr Fitzsimons. Each of these involved the relevant assessor attributing a number representing the level of impairment to a particular area of functioning as part of the process of determining the level of whole person impairment. There was some area of overlap between the areas of impairment. For example the CDR scale required the attribution of a score for "personal care" whereas the psychiatric impairment scale had a score for "self care and personal hygiene". Mr Robinson SC pointed to what he asserted were inconsistencies between their various assessments and submitted that Dr Fitzsimons must have relied on Mr Ali's description of his own functioning to undertake that assessment. I do not accept that there is any relevant inconsistency. Dr Fitzsimons determined the CDR ratings in the manner I have described above, ie by using her clinical judgment to infer the likely level of functional impairment based upon the injuries Mr Ali undoubtedly suffered. Dr Fitzsimons did not rely upon his account and recognised that that meant the scale was difficult to apply ("under such circumstances the CDR scale is also difficult to apply"). 44In light of this analysis, I will consider the remaining complaints of error made by AAMI concerning the first decision. 45As I have said, AAMI complains that the proper officer did not take into account Dr Lewin's report. It points to the absence of any express reference to it in the proper officer's reasons. 46For reasons I will explain, I am not persuaded that the proper officer failed to take into account Dr Lewin's second report. However, at the outset it should be noted that there is nothing in the statutory scheme which imposed any obligation on the proper officer to consider the entirety of the evidentiary material placed before them when addressing a request under s 63(3) of the MAC Act. The authorities do not impose any such obligation either (see Allianz Australia Insurance Ltd v Cervantes [2012] NSWCA 244 at [22] per Basten JA, McColl and Macfarlan JJA agreeing). Instead, for this alleged form of error to give rise to invalidity it must be demonstrated that the alleged act of overlooking the relevant material flowed from some legal misconception about the function being exercised by the tribunal or administrative decision maker. Thus, in Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; 206 CLR 323 at 351, McHugh, Gummow and Hayne JJ stated at [82]: "It is necessary, however, to understand what is meant by "jurisdictional error" under the general law and the consequences that follow from a decision-maker making such an error. As was said in Craig v South Australia, if an administrative tribunal (like the Tribunal) 'falls into an error of law which causes it to identify a wrong issue, to ask itself a wrong question, to ignore relevant material, to rely on irrelevant material or, at least in some circumstances, to make an erroneous finding or to reach a mistaken conclusion, and the tribunal's exercise or purported exercise of power is thereby affected, it exceeds its authority or powers. Such an error of law is jurisdictional error which will invalidate any order or decision of the tribunal which reflects it.' 'Jurisdictional error' can thus be seen to embrace a number of different kinds of error, the list of which, in the passage cited from Craig, is not exhaustive. Those different kinds of error may well overlap. The circumstances of a particular case may permit more than one characterisation of the error identified, for example, as the decision-maker both asking the wrong question and ignoring relevant material. What is important, however, is that identifying a wrong issue, asking a wrong question, ignoring relevant material or relying on irrelevant material in a way that affects the exercise of power is to make an error of law. Further, doing so results in the decision-maker exceeding the authority or powers given by the relevant statute. In other words, if an error of those types is made, the decision-maker did not have authority to make the decision that was made; he or she did not have jurisdiction to make it. Nothing in the Act suggests that the Tribunal is given authority to authoritatively determine questions of law or to make a decision otherwise than in accordance with the law." (emphasis added) 47The italicised portions of this passage emphasise that the task is not one of simply identifying evidentiary material that was relevant to the decision maker's task and then ascertaining whether it was referred to it in their reasons. It involves a process of determining whether or not it was considered and, if not, why it was not considered. The second inquiry is necessary because before jurisdictional error can be established it must be shown that there was, in the words of Craig, an "error of law" which caused the body to ignore the relevant material or, in the words of Yusuf, that the ignoring of relevant material happened "in a way that affects the exercise of the power". An example of this is to be found in Owen v Motor Accidents Authority (NSW) [2012] NSWSC 650, at [50] where Campbell J inferred from the failure of a review panel to consider certain material that it applied too narrow a test of causation. 48There is considerable overlap between this form of error and a breach of natural justice or a constructive failure to exercise jurisdiction. This is so because aspects of those grounds can import a limited "obligation" to consider at least some of the evidentiary material placed before a decision maker (Cervantes at [19] to [22], per Basten JA). Thus, in Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; 77 ALJR 1088, Gummow and Callinan JJ stated (at [24]) that "[t]o fail to respond to a substantial, clearly articulated argument relying upon established facts was at least to fail to accord Mr Dranichnikov natural justice." In Re Minister for Immigration and Multicultural Affairs; Ex parte Miah [2001] HCA 22; 206 CLR 57, Gaudron J at [81] stated that a failure in that case to address the substance of a person's claim for refugee status was "a clear case of constructive failure to exercise jurisdiction". Hence, and only by way of example, a failure to consider a critically relevant piece of evidence may have happened "in a way that affects the exercise of the power" (Yusuf) because it may reveal that an applicant's case was not addressed or was misunderstood. 49Section s 63(3) of the MAC Act focuses attention upon the "particulars set out in the application" for review. Those particulars were set out in the submissions accompanying the application, which I have summarised in [27], namely, Mr Ali's unreliability. The proper officer addressed those particulars. 50As I have noted, on 8 September 2011 a letter was written on behalf of the proper officer to AAMI acknowledging receipt of AAMI's letter of 7 September 2011 which referred to Dr Lewin's second report. The letter dated 8 September 2011 stated that the proper officer would consider the "issues raised" in AAMI's letter. What issues were raised? I have set out the relevant parts of the submissions in AAMI's letter in [29] above. The critical part of the letter is the assertion in the second paragraph by the solicitors for AAMI that: "[w]e consider the determination of Assessor Lewin provides further support for the contentions raised in our application for review of this matter" (emphasis added). The balance of the letter refers to how Dr Lewin was severely critical of Mr Ali as a historian and concluded that, in the light of his history, no proper medical assessment could be "undertaken on the basis of the claimant's subjective complaints". 51Thus, AAMI's solicitors only relied upon Dr Lewin's second report as reinforcing the difficulties in relying upon Mr Ali's "subjective complaints" or history to make such an assessment. The answer to that contention given by the proper officer was that Dr Fitzsimons did not rely upon Mr Ali's "subjective complaints" in making her assessment. In that context, and given that the obligation imposed upon the proper officer was only to give "brief reasons", I do not think that it can be inferred from the absence of any express reference to Dr Lewin's second report in the proper officer's three and a half page reasons that it was not taken into account. The letter of 8 September 2011 suggests it was brought to the proper officer's attention. The absence of any express reference to it is completely explicable by the fact that the proper officer construed Dr Fitzsimons as eschewing reliance on Mr Ali as a historian or his "subjective complaints". Thus he rejected the premise of AAMI's submission. This meant that Dr Lewin's second report was of little or no significance as the premise of AAMI's submissions that made it important had been rejected. 52This reasoning is sufficient to dispose of the other bases upon which AAMI sought to attack the first decision. The assessor did not fail to address the case that was put by AAMI in support of its application under s 63(3). AAMI's contention was that there was a reasonable cause to suspect that Dr Fitzsimons' medical assessment was incorrect in a material respect because it was reliant upon the "subjective complaints" of Mr Ali, and that he was a poor historian. Dr Lewin's report was relied on in aid of that contention. The answer to that submission given by the proper officer was that Dr Fitzsimons did not rely upon Mr Ali's "subjective complaints" but, instead, reasoned in the manner I have described above. For the same reason the complaint of a breach of natural justice is not made out. 53It follows that I reject AAMI's challenge to the first decision. The second decision 54On 31 October 2011, AAMI lodged a MAS Form 4ABI seeking referral of the matter for further assessment under s 62(1)(a). AAMI nominated Dr Lewin's second report as the additional relevant information for the purposes of s 62(1)(a). A submission from AAMI in support of the application set out a detailed history of what was said to be the inconsistent histories and complaints made by Mr Ali. It was followed by a very detailed letter on 25 November 2011. The following passage from that letter reflects the tenor of the submission lodged with the application: "The insurer submits that the above provides further evidence that the subjective complaints of the claimant cannot be accepted as truthful, and accordingly any assessment relying upon the complainant's subjective complaints (as with Assessor [Fitzsimons'] assessment) cannot be considered to be accurate. 55On 27 January 2012, another proper officer rejected the application for a further referral of the assessment under s 62 of the MAC Act. Her reasons were set out in a two page letter which included the following: "... I am not satisfied that the deterioration of the injury and/or the additional relevant information about the injury is such as to be capable of having a material effect on the outcome of the previous assessment [i.e. by Dr Fitzsimons] as required by section 62(1A) of [the MAC Act]. I have therefore determined that the application shall not be referred for further assessment. The application relies on the MAS report of Assessor Lewin dated 2 August 2011 as being additional relevant information about the injury as it was not available to MAS Assessor Fitzsimons before completing her report dated 1 June 2011. It is noted that Dr Lewin had previously assessed the claimant as having a whole person impairment of 26% in relation to his psychiatric injury. The basis of the application is the history obtained by Assessor Lewin and the fact that this history may not corroborate the history and information contained in the additional relevant information attached to that application. The applicant feels that Assessor Fitzsimons, with the aid of that relevant information, should have come to the same conclusion as Assessor Lewin in that the history obtained by the applicant could not be trusted as it differs significantly from the history contained in other reports. ... The application and submissions attached are not enough to convince me that section 62(1A) is satisfied. The 'additional relevant information' is the MAS Psychiatric Assessment of Assessor Lewin, based on the same information and the report of Dr Fitzsimons. Dr Fitzsimons is very clear in her report that the impairment assessment attributed to the subject accident is based on the claimant's very severe head injury with multiple fractures and an extradural haematoma that some degree of cognitive impairment and/or emotional/behavioural disturbance would be attributed to the head injury, irrespective of ... those which might be attributed to the psychiatric injury." (emphasis added) 56AAMI submits that three relevant forms of error affect the second decision. 57First, AAMI submits that the proper officer imposed too high a test in so far as she stated that AAMI's application and submissions were not enough to "convince" her that s 62(1A) was satisfied. It was submitted that by expressing a need to be "convinced" the proper officer had set too high a standard. I do not regard this submission as having any more force than the similar argument I have rejected in relation to the first decision. No complaint was made about the expression of the statutory test by the proper officer in the first paragraph of the quote that I have extracted above in [55]. The word "convince" in this context is simply another means of expressing a need to reach some form of positive state of mind concerning the matters specified in s 62(1A). 58The second error on the part of the proper officer was that it was said that she failed to identify Dr Lewin's second report as "additional relevant material" within the meaning of s 62(1)(a) of the MAC Act. The essence of the proper officer's reasons was that Dr Lewin's second report was not capable of having a material effect on the outcome of the "previous assessment" (i.e. Dr Fitzsimons' report), because Dr Fitzsimons' report did not involve any reliance upon the history or "subjective complaints of Mr Ali". The proper officer did not determine whether or not Dr Lewin's report constituted "additional relevant information" but, on the assumption that it, did, nevertheless concluded that s 62(1A) was not satisfied. This approach did not involve error. 59Third, AAMI asserts that the proper officer "failed to determine that the additional relevant information was capable of having a material effect on the previous medical assessment" of Dr Fitzsimons. In substance, this amounted to a contention that the proper officer was wrong to conclude that Dr Fitzsimons' report did not depend upon or involve reliance upon Mr Ali's subjective complaints or history as relayed by him. In my view, this involves an attempt to seek merits review. Ultimately a question as to whether the relevant additional information is capable of having a "material effect on the outcome of the previous assessment" is a question of fact for the proper officer to consider. It follows from the discussion in [37]-[43] above, that I consider that the analysis by the proper officer of Dr Fitzsimons' assessment was not only reasonably open, it was correct. 60I reject AAMI's challenge to the second decision. The third decision 61As noted above, Mr Ali's claim had been referred to the MAS for assessment under Pt 4.4 of the MAC Act on 13 July 2009. At some point, the third defendant (the CARS assessor) was appointed as the claims assessor for Mr Ali's claim. The assessment was adjourned to await the outcome of the various medical assessment applications. 62On 27 February 2012, AAMI's solicitors wrote to the CARS assessor advising of the rejection of their application for further assessment (i.e. the second decision). They stated that they were making an application to have him "remit the matter back to MAS for assessment pursuant to a s 62(1)(b) of the Motor Accidents Compensation Act 1999". They made various submissions in support of that contention. 63On 28 February 2012 a "preliminary conference" was held by the third defendant. It was attended by the legal representatives for AAMI and Mr Ali. Tendered in evidence was a document prepared by the CARS assessor following that conference which records, inter alia, what happened during that conference. Paragraph 1 of the note referred to the application made in the letter of 27 February 2012. The CARS assessor's note includes the following: "3. I referred the solicitor for the insurer [AAMI] to s 62(1) of the Act and I requested her to advise me upon what basis I should refer the matter back to MAS having regard to the fact I could only refer the matter on the grounds of the deterioration of the injury or additional relevant information about the injury. 4. The solicitor for the insurer in response, stated that she was not in a position to provide me with any additional relevant information about the injury. She advised me that her client was not prepared to accept the findings of [the proper officer who made the second decision] as set out in her letter dated 27 January 2012 and furthermore confirmed, as stated in her letter dated 27 February 2012, she had already received instructions from the client insurer to seek judicial review of the MAS Proper Officer's decision to reject their Application for Further Assessment. 5. The solicitor for the insurer further advised that an Application to the Supreme Court is presently being drafted and would be filed on or before 13 March 2012. 6. Accordingly, I advised the solicitor for the insurer that I refuse to make a referral back to MAS for assessment pursuant to s 62(1)(b) of the Act as, clearly, there is no additional relevant information about the injury which would cause me to consider making such a referral. (emphasis added) ..." 64The third decision complained of is the refusal of the CARS assessor to refer so much of the "matter" as involved Mr Ali's neurological injury and impairment arising from the accident for further assessment pursuant to s 62(1)(b) of the MAC Act. 65AAMI's short point is that the italicised portion of the above extract reveals a misconstruction of s 62(1)(b) by the CARS assessor. In particular, it submitted that the note records the claims assessor considering that he only had the power to refer the matter for further assessment "on the grounds of the deterioration of the injury or additional relevant information about the injury". It is submitted that is not a limitation upon his power under s 62(1)(b), but is instead only a limitation on the circumstances in which a party to a medical dispute could seek further assessment. This submission is clearly correct. The CARS assessor has clearly wrongly construed s 62(1) and imposed an added gloss on the statutory test which has no constraints other than the purpose and scope of the MAC Act (Trazivuk v Motor Accidents Authority of New South Wales [2010] NSWCA 287 at [77] per Giles JA, in dissent but not on this proposition). 66Leaving aside discretionary considerations an issue arises as to what relief, if any, is available in respect of this decision. If the CARS assessor had proceeded to make a final determination and made no reference to the reasons for his refusal to refer the matter for further assessment under s 62(1)(b) then I would be very doubtful as to whether any relief would be available. In that event no error of law would be apparent on the face of the record and I have significant doubts as to whether any such error would affect the CARS assessor's exercise of jurisdiction under s 94 of the MAC Act (see Minister for Immigration and Citizenship v SZGUR [2011] HCA 1; 241 CLR 594 at [74] to [78] per Gummow J). Further, any declaratory relief in respect of a decision under s 62(1)(b) would be likely to be refused as futile as it would have no consequences for the parties whose rights would be governed by a decision under s 94 (see Plaintiff M61/2010E v Commonwealth of Australia [2010] HCA 41; 243 CLR 319 at [101]). 67However no decision under s 94 has been made. Thus, any issue as to the utility of or jurisdiction to grant relief in respect of the decision under s 62(1)(b) is not affected by a later decision having been made in the statutory scheme for making a CARS assessment. While the note prepared by the assessor would probably not form part of the record in that it does not appear to record the "ultimate determination" (cf ss 69(3) of the Supreme Court Act), the CARS assessor did not have authority (i.e. jurisdiction) to refuse the exercise of that power on the basis stated in that note. In Trazivuk Giles JA found legal error on the part of a CARS assessor in refusing to require a further assessment under s 62(1)(b) and proposed the setting aside of the decision (at [72] to [81] and [96]). Young JA and Handley AJA disagreed with Giles JA concerning whether an error had been demonstrated but did not express any doubt that relief would have been available if error had been shown. 68In any event, ultimately AAMI only sought declaratory relief in respect of the third decision. At this point in the scheme of decision making there is no barrier to it being granted (Plaintiff M61 at [101] to [103]). Such a declaration may be of real assistance to AAMI if it requests the CARS assessor make a further assessment for the same or different reasons than it has done in the past. It will ensure that it does not have to meet a test imposed by the CARS assessor that has no basis in the statute. 69Senior Counsel for Mr Ali, Ms Norton SC, contended that, as a matter of discretion, no relief should be granted in relation to the third decision. She submitted that the note of the preliminary conference revealed that, after the CARS assessor expressed his view as to the operation of s 62(1)(b), AAMI's solicitor did not point out the error and seek a further exercise of the power. Without knowing more about exactly what occurred during the hearing, I am not satisfied that the CARS assessor's note reveals that AAMI acquiesced in the CARS assessor's misconstruction of s 62 (cf Re Refugee Review Tribunal; ex parte Aala [2000] HCA 57; 204 CLR 82 at [53] per Gaudron and Gummow JJ). 70I consider it is appropriate to grant relief in respect of this decision by the CARS assessor. I have referred above to s 95 of the MAC Act. It is not clear to me whether in this case AAMI accepts that it is liable for Mr Ali's claim. If it does, then it can become bound by the CARS assessment of the quantum of the claim if Mr Ali accepts that amount of damages within twenty-one days after a CARS assessor's certificate is issued. It is a condition of AAMI's licence that it comply with the section. It follows that an assessment of damages by a CARS assessor has a real potential to be binding upon AAMI and so affect its rights and expectations. This is a factor in favour of at least allowing AAMI to ensure that CARS assessments proceed in a manner where the assessor properly recognises the scope of the powers and discretions that are available to him or her. Conclusion and costs 71I will grant AAMI declaratory relief in respect of the third decision but dismiss the balance of its summons. In relation to costs, the parties litigated three decisions. AAMI was unsuccessful in respect of two but was successful with the third. I will order AAMI pay one third of Mr Ali's costs of the proceedings. If either party seeks a variation of that order then they should apply with seven days of this judgment. 72Accordingly the Court makes the following orders: (1)Declare that, in refusing on 28 February 2012 to refer the first defendant's neurological injuries for further assessment under Part 3.4 of the Motor Accidents Compensation Act 1999, the third defendant erred in law in that he wrongly construed s 62(1)(b) thereof as only enabling such a referral on the grounds of a deterioration of those injuries or if there was available additional relevant information about the injuries; (2)The Plaintiff's summons be otherwise dismissed; (3)The Plaintiff pay one third of the First Defendant's costs of the proceedings; and (4)If either party wishes to apply to vary order (3) then any such application together with submissions in support, which are not to exceed three pages, are to be filed and served within seven days hereof. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 14 September 2012