Supreme Court New South Wales Medium Neutral Citation: Bastick v Allianz Australia Insurance Limited [2014] NSWSC 887 Hearing dates: 28 February 2014 Decision date: 04 July 2014 Jurisdiction: Common Law - Administrative Law Before: RS Hulme AJ Decision: (1) Declare that in the events that have happened the Plaintiff on or about 3 September 2013 accepted the assessment made by CARS Assessor Cowley on 22 August 2013; (2) Declare that the Defendant is liable to pay to the Plaintiff the amount of damages and other amounts specified in the Certificate reflecting that assessment, together with interest thereon calculated in accordance with regulation 17A of the Motor Accidents Compensation Regulations 2005. (3) Order the Defendant to pay the Plaintiff's costs of and incidental to these proceedings in this Court. (4) Grant liberty to apply as to the form of these orders by written notification to the Registrar within 14 days of the delivery of this judgment. Catchwords: MOTOR ACCIDENT - compensation - assessment - what is acceptance Legislation Cited: Motor Accidents Compensation Act 1999 Category: Principal judgment Parties: Mary Bastick (Plaintiff) Allianz Australia Insurance Limited (Defendant) Representation: Counsel: R de Meyrick (Plaintiff) W Fitzsimmons (Defendant) Solicitors: Beston Macken McManis (Plaintiff) TL Lawyers (Defendant) File Number(s): 2013/339598 Judgment 1By summons filed on 11 November 2013 the Plaintiff in these proceedings seeks orders that:- 1. A declaration that on a true construction of the events that have happened the Plaintiff has accepted the parties are bound by the Certificate assessing damages issued by CARS Assessor Cowley on 28 August 2013. 2. A declaration that the Defendant is in breach of Section 95(2) and 95(3) of the Motor Accidents Compensation Act 1999 (NSW). 3. An order that the Defendant pay the Plaintiff the Amount of Damages specified in the Certificate assessing damages issued by CARS Assessor Cowley on 28 August 2013 together with any interest and costs also payable in respect thereto. 4. Costs. 5. Such further or other orders as the Court deems fit. 2On 11 December 2013, the Plaintiff suffered injuries as a result of a motor vehicle accident. The Defendant who was the insurer of the relevant motor vehicle admitted liability. There were delays of no present relevance and then some time after July 2009 the Plaintiff's solicitor informed the Defendant that the Plaintiff wished to either proceed or settle her claim. Agreement could not be reached, the claim was submitted for assessment and eventually set down for a hearing before Assessor Cowley on 1 August 2013. 3By email of 22 August 2013 Mr Cowley forwarded his certificate and reasons resulting from that assessment to the solicitors for the parties. 4By letter dated 2 September 2013 the Motor Accidents Authority wrote to the Plaintiff's solicitors. The letter was in terms:- CARS have received a copy of the reasons and certificate issued by Assessor Allan Cowley on 28 August 2013. I note the insurer has wholly admitted liability for the claim. Under clause 18.9 of the Claims Assessment Guidelines, the insurer is to advise CARS by 17 October 2013 whether or not the claimant accepted or rejected the assessment in accordance with section 95(2)(b). Communication to CARS about acceptance or rejection of the assessment should be sent to: The Exemptions and Assessments Officer Claims Assessment and Resolution Service DX 10 Sydney Alternatively, parties can advise CARS by email: CARSUnit@maa.nsw.gov.au. The CARS file will now be closed. 5Although the letter does not say so, an affidavit of the Plaintiff's solicitor suggests that a copy of the Assessor's certificate and reasons was included with the letter. 6On 3 September 2013 the Plaintiff's solicitor wrote to CARS advising that the plaintiff "accepts Assessor Cowley's reasons and certificate dated 22 August 2013". By oversight no corresponding letter was sent to the Defendant or its solicitors. 7On 20 September 2013 the Plaintiff's solicitors wrote to the Defendant's solicitors in relation to the matter and on 24 September received a reply. In that reply the Defendant's solicitors observed:- We note there has been no acceptance of the award of Assessor Alan Cowley dated 22 August 2013 as required by s95 of the Motor Accidents Compensation Act 1999 within the required timeframes. 8The Plaintiff's solicitors responded asserting that the assessment had been accepted. Thereafter the parties have maintained their respective positions. 9Although it is not directly relevant to my decision, mention might be made also of a letter of 5 February 2013 to the solicitors for the parties from the Motor Accidents Authority. In that letter the MAA remarked, inter alia:- It would appear Assessor Cowley provided his certificate and reasons to the parties and to CARS by email on 22 August 2013. Please find attached a copy of the email from Assessor Cowley received by CARS on 22 August 2013. I note that in my letter dated 2 September 2013, I incorrectly informed the parties that the certificate and reasons were received by CARS on 28 August 2013. I apologise for this error. 10There are a number of provisions of the Motor Accidents Compensation Act 1999 to which reference should be made:- 5 Objects of Act (1) The objects of this Act are as follows: (a) ... (b) to provide compensation for compensable injuries sustained in motor accidents, and to encourage the early resolution of compensation claims, 6 Interpretation and application of Act by reference to objects (1) In the interpretation of a provision of this Act or the regulations, a construction that would promote the objects of this Act or the provision is to be preferred to a construction that would not promote those objects. 69 Claims Assessment Guidelines of Authority (1) The Authority may issue guidelines for or with respect to procedures for the assessment of claims under Part 4.4 and associated matters ... 11Part 4.4 of the Act provides for the assessment and resolution of claims. It details procedures to be followed in that connection and by s94 requires an assessor to whom a claim if referred to make an assessment and as soon as practicable after an assessment is made to notify an insurer and claimant with a certificate as to the assessment together with a brief statement of the assessor's reasons. Sections 95 and 97 then provide:- 95 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. (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 ... (3) It is a condition of an insurer's licence under Part 7.1 that the insurer complies with this section. 97 Regulations (1) The regulations may make provision for or with respect to any aspect of procedures to be followed under this Part, including provision for or with respect to: (a) ... (f) the extension or abridgment of any period referred to in this Part. 12In the event a claimant does not accept an assessment, the only way he or she can recover damages for injury suffered in an accident is to then commence court proceedings. It is unnecessary for me to refer at any length to the numerous provisions of the Act that deal with such proceedings but note should be made of the provisions of s151 which are calculated to impose substantial costs penalties if a claimant does not recover in court proceedings significantly more than the damages determined in the course of an assessment. There can be no doubt that, considered as a whole, the Act attempts to deter, but not prevent, court proceedings. 13It should be noted also that the Act does not contemplate that CARS or any other branch of the Authority charged with functions under the Act will take any steps consequent on the claimant or insurer being advised of an assessment. 14No regulations dealing with an extension or abridgment of time such as contemplated by s 97 of the Act have been made. However Guidelines as contemplated by s 69 have been issued. So far as presently relevant they provide:- Accepting or rejecting an assessment 18.8 The method by which a party to an assessment accepts or rejects an assessment of the issue of liability for a claim (under section 95(1)) is to notify the other party in writing of the acceptance or rejection. In these cases the insurer is required to advise CARS in writing no later than 2 calendar months after the issue of the certificate of assessment, whether or not that certificate of assessment has as yet been accepted or rejected by either party. 18.9 The method by which a claimant accepts or rejects an assessment of damages for liability under a claim (under section 95(2)) is to notify the insurer in writing of the acceptance or rejection within 21 calendar days after the certificate of assessment was issued. In these cases the insurer is required to advise CARS in writing no later than 2 calendar months after the issue of the certificate of assessment, whether or not that certificate of assessment was accepted by the claimant. 15Provision was made in clauses 5.1 and 5.2 of the Guidelines for the abridgment or extension of any time limit fixed by the Guidelines. 16Mention might be made of Chapter 19 of the Guidelines. It provides that a party who considers that an assessor has made an obvious error may, within 21 days of the issue of a certificate of assessment, apply to have the error corrected. Chapter 19 then goes on to deal with matters consequent on any such application and the possible issue of a replacement certificate. Apart from the notification envisaged by clauses 18.8 and 18.9, this is the only situation contemplated by the Guidelines where the Assessor or Authority has any role to play subsequent to the issue of an assessment. 17Subsequent to the hearing before me, and in consequence of remarks made during that hearing, application was made to the Principal Claims Assessor for an extension of the time limited in Clause 18.9. The Principal Claims assessor refused the application upon the ground that it would be futile to do so as she had no power to extend time under s 95(2) of the Act. Decision 18Although s 95(2)(b) refers to a claimant accepting an amount of damages, the paragraph must mean accepting the result of the assessment or agreeing to accept the amount of damages reflected in that Assessment. As a matter of universal practice, the damages would not be paid until some time after the acceptance referred to in the paragraph. 19Be that as it may, there can be no doubt that for a claimant to accept or agree to accept as envisaged by the paragraph, the claimant's decision must be communicated to someone. An uncommunicated decision in a claimant's mind could not be regarded as acceptance. Furthermore, as the acceptance (a term I shall use hereafter to include agreement to accept) is intended to have some operative force, that communication must be to someone having an interest in hearing of the acceptance or, possibly, involved in the assessment. One could not regard communication of acceptance to a claimant's wife or solicitor as acceptance within the terms of the paragraph. 20Clearly communication to the insurer who is or would come under a liability to pay the amount of damages assessed would be adequate communication. In support of the contention that it was only communication to the insurer that would be effective, attention was drawn to the fact that acceptance was "in settlement of the claim", something in which the insurer had a substantial interest, the obligation in s 95(2A) on the insurer to pay the amount assessed, and possibly interest, and the sanction against the insurer consequent on the terms of s 95(3). 21However, these latter arguments are greatly weakened when regard is had to the terms of the relevant regulation, 17A, which requires payment "within 20 business days of the claimant's communication of acceptance of the assessment". In that context, "communication" can only mean communication to the insurer. Interest also is only payable from that date. 22But there remains the question of why should communication to anyone other than the insurer be sufficient? 23So far as the Act itself is concerned, the answer in my view lies in the language of s 95(2) which refers merely to a claimant's acceptance of an assessment and contains no specification or limits as to how that acceptance is to occur and in particular no requirement that acceptance be effected by notice to the insurer. One may accept that one of the objects of imposing the time limit in s 92(2) - objects seen elsewhere in the Act - is to have matters finalised sooner rather than later but the consequences of a failure to accept within the time specified are such that there is no reason to add additional requirements or technicalities to what the Act itself has imposed. In that regard it cannot be ignored that if a claimant is forced to institute court proceedings, significantly greater delay and costs will be incurred, something that the Act seeks to discourage. 24Although obviously the letter's terms cannot affect the construction or interpretation of the Act, the letter of 2 September 2013 from the Authority provides an illustration of the complications that can occur if there is read into the Act requirements for which it does not provide. Written to the claimant's solicitor the letter contemplated that he might communicate with CARS about acceptance. On the Defendant's contention, even if the solicitor was misled by the Authority in that connection, notification of acceptance to the Authority would not suffice. 25Although, as I have noted, the Act seems not to contemplate any action by the Authority consequent on acceptance or receipt of notice that that has occurred, and I do not suggest that the Act is to be interpreted by reference to the Guidelines, in that they require an insurer to notify the Authority of an acceptance or rejection, the Guidelines do contemplate that the Authority has some such interest in knowing the result. 26I am unable to see any disadvantage to an insurer in the acceptance being by communication to the Authority. The insurer has no obligation to pay until it itself is notified and if it was in any doubt it would take but an inquiry by email or phone to find out if, unbeknown to it, acceptance had occurred. One suspects it would do what happened in this case - nothing, until it was contacted by the Plaintiff's advisers. 27I should say that in arriving at the decision I have I have derived no assistance from the Objects of the Act or its interpretation by reference to those object. 28What then is the effect of Guideline 18.9? Given the view I have taken of s 95(2) I cannot regard the Guideline as mandatory, breach of which nullifies the acceptance. The ability of the Registrar, PCA or Assessor to extend time under clause 5, so that late notice to an insurer effectively complies with clause 18.9, reinforces this conclusion. 29With one qualification, in the result, the Plaintiff is entitled to the substance of the relief sought in prayers 1-3 in the Summons. The qualification arises in connection with the claim for a declaration that the Defendant is in breach of s 95(3) of the Act. The matter was not argued but it does not seem to me that the Plaintiff has an interest in the making of such a declaration, even if the Defendant is in breach of s 95(2) (and s 95(2A)). 30However, it also seems to me that the principal relief to which the Plaintiff is entitled could be better expressed than in the prayers in the Summons. In these circumstances it seems to me that the best course to minimise the prospect of the parties incurring further costs is to formulate orders in a way that seems to me best, giving liberty to apply in the event anyone wishes to argue against the form of those orders. 31Although the issue that has led to these proceedings arose because of a failure on the Plaintiff's side to comply with clause 18.9 of the Guidelines, the Defendant has elected to fight the issue in this Court. Accordingly the Defendant should pay the Plaintiff's costs. 32In these circumstances, (1) Declare that in the events that have happened the Plaintiff on or about 3 September 2013 accepted the assessment made by CARS Assessor Cowley on 22 August 2013; (2) Declare that the Defendant is liable to pay to the Plaintiff the amount of damages and other amounts specified in the Certificate reflecting that assessment, together with interest thereon calculated in accordance with regulation 17A of the Motor Accidents Compensation Regulations 2005. (3) Order the Defendant to pay the Plaintiff's costs of and incidental to these proceedings in this Court. (4) Grant liberty to apply as to the form of these orders by written notification to the Registrar within 14 days of the delivery of this judgment. ********** 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: 07 July 2014