Sparke Helmore's MAD (Motor Accidents Division) Weekly - Issue 99

Welcome to the 99th edition of Sparke Helmore’s MAD Weekly.

The Personal Injury Commission (Commission) commenced on 1 March 2021 and, with it, the publication of the majority of decisions issued by the Commission.

To help you navigate the recent decisions of the Motor Accidents Division (MAD) of the Commission, we are publishing weekly the relevant headnotes of published decisions with a link to the decisions on the Australasian Legal Information Institute (AustLII) website. Please see this week’s edition below.

All references to legislation are to the Motor Accident Injuries Act 2017 (NSW) unless otherwise noted.

Commentary and analysis of trends will be provided on more substantive decisions by our CTP team and will be separately published when necessary.

Review Panel Determination

Khudhair v QBE Insurance (Australia) Limited [2023] NSWPICMP 394

Panel: Principal Member John Harris, Dr Shane Moloney, and Dr Geoffrey Stubbs

Assessment of permanent impairment – injuries reported to spine, left arm, right arm and leg – range of motion not applicable test due to inconsistency – whether lack of pre-accident complaints or records determinative of causation.

On 3 February 2019, the claimant was a front seat passenger and sustained injuries when the insured vehicle rear ended the claimant’s vehicle. A medical dispute arose as to whether the claimant sustained a degree of permanent whole person impairment (WPI) greater than 10% as a result of the accident. Injuries to the following body parts were referred for assessment:

• cervical spine
• lumbar spine
• left arm including elbow, shoulder and hand
• right arm, hand and shoulder
• left hip and knee, and
• right hip and knee.

On examination, the Medical Assessor found the accident not causative of a change in impairment. The Medical Assessor found the claimant’s symptoms were similar to those documented by the claimant’s GP since 2011, emphasising several inconsistencies in the claimant’s history and the available treating evidence.

At first instance, Medical Assessor Woo assessed the claimant’s level of WPI at 0%, noting inconsistency on presentation and the claimant’s exaggeration of her symptoms with ‘self-imposed guarding’. Given the claimant’s extensive and recent medical history, the Medical Assessor found that the subject accident caused soft tissue injuries to the cervical and lumbar spines, right arm, hand and shoulder and right hip and knee. At first instance, the Medical Assessor found that the claimant did not sustain injuries to the left arm, below, hand, shoulder, hip and knee.

The claimant lodged an application for review on the following grounds:

• the Medical Assessor failed to comply with cl 6.41 of the Motor Accident Guidelines (the Guidelines) by failing to give her an opportunity to respond to observations of inconsistencies
• the Medical Assessor failed to refer to objective evidence of pre- and/or post-accident impairment as required by cls 6.31-6.34 of the Guidelines
• the conclusion of 0% WPI was inconsistent with the available treating evidence and the Guidelines, given findings of non-verifiable radicular complaints to the right hand at first instance, and
• the conclusion of 0% WPI was inconsistent with the Medical Assessor’s findings of restricted range of motion of the right shoulder and tenderness over the medial and lateral epicondylitis of the right elbow.

The Review Panel, consisting of Medical Assessor Moloney undertaking a physical assessment, stated the primary issue for consideration was the medical plausibility of the claimant having sustained injuries amounting to a WPI of greater than 10%. The Panel acknowledged the claimant’s significant history of pre-existing health complaints, finding it plausible that the claimant sustained soft tissue injuries to the cervical and lumbar spine caused by the modest impact of the motor accident. The Panel did not believe that these findings were sufficient to find DRE Category II.

The Panel otherwise noted that there were no signs of radiculopathy nor non-verifiable signs of same because the claimant’s complaint did not follow a ‘distribution of a specific nerve root’. Accordingly, the Panel assessed DRE Category I for the lumbar and cervical spine.

Similarly, the Panel noted that the re-examination did not reveal any tenderness or pain in the left arm, left shoulder, left elbow, left hand, left hip and left knee; the Panel ultimately found there to be no assessable impairment to these areas.

Applying Bugat v Fox [2014] NSWSC 888, the Review Panel opined that an inclusion of injury in a claim form is relevant for establishing causation, with the omission of a reference to a body part being similarly relevant. Nonetheless, the Panel noted that these factors, while relevant, were not determinative of causation per se. Accordingly, the Panel noted that the absence of complaints of right-sided symptoms to the right leg, knee and hip indicated that these body parts were not injured in the accident. The Panel further held that the nature of the accident was otherwise inconsistent with an injury to a front-seated passenger sustaining soft tissue injury symptoms to the right side.

Similarly, the Review Panel applied AAI Ltd v McGiffen [2016] NSWCA 229 and held that the absence of records of complaints of right-sided symptoms was relevant, but not determinative of causation.

Additionally, the Panel commented on the claimant’s inconsistency in presentation, opining that the Medical Assessor at first instance had correctly relied on an analogical method of assessment, and range of motion could not reliably be used as a valid parameter for assessing impairment.

Findings: The Review Panel affirmed the certificate of Medical Assessor Woo, which assessed the claimant at 0% WPI.

View decision

Review Panel Determination

Lang v Insurance Australia Limited t/as NRMA Insurance [2023] NSWPICMP 404

Panel: Member Terence O’Riain, Dr Michael Couch, and Dr Alan Home

Medical assessment of threshold injury – whether radicular complaints identified at first instance – whether intervertebral disc injury a cartilage tear – failure to review diagnostic imaging at first instance.

On 8 March 2021, the claimant sustained injuries as a front seat passenger when his stationary vehicle was rear-ended by the insured vehicle. A medical dispute arose as to whether the injuries caused by the accident were threshold injuries for the purposes of the Act. Injuries to the following areas were referred for assessment:

• lumbar spine
• cervical spine
• left shoulder, and
• right shoulder.

At first instance, Medical Assessor Harrington determined that all of the claimant’s injuries were soft tissue injuries and could not find evidence of radiculopathy. Medical Assessor Harrington assessed the claimant’s lumbar spine and shoulder injuries as soft tissue injuries, opining that they had resolved since the accident.

The claimant subsequently lodged an Application for Review, submitting that the radiculopathy symptoms in the claimant’s lumbar spine evidenced a non-threshold injury, pursuant to s 1.6 of the Act and reg 4 of the Act. Additionally, the claimant argued that the available diagnostic imaging revealed a posterolateral disc herniation that impinged on the exiting nerve root, satisfying the definition of a ‘non-threshold injury’.

The Review Panel noted that a re-examination of the claimant was necessary, which was performed by Medical Assessor Home.

The Review Panel accepted the claimant’s lack of history of neck or back complaints prior to the accident, finding mild muscle guarding on the left side of the cervical spine. On re-examination, the Panel was satisfied that the claimant had sustained a soft tissue injury to the cervical spine, with the claimant’s presentation failing to meet the criteria for cervical radiculopathy per cls 5.8-5.10 of the Guidelines. Accordingly, the Review Panel found the claimant sustained a threshold injury to the cervical spine.

Conversely, the Review Panel found the claimant’s injury to the lumbar spine, namely the injury to the L5/S1 intervertebral disc, met the definition of a non-threshold injury, noting that annulus fissures represent a tear in the fibrocartilage, and therefore cartilage tears. The Review Panel further found that there were insufficient clinical signs to determine a diagnosis of radiculopathy in accordance with cls 5.8-5.10 of the Guidelines; however, the tear in cartilage was sufficient to deem the claimant’s lumbar spine injury as a non-threshold injury for the purposes of the Act.

Findings: The Review Panel revoked the certificate of Medical Assessor Harrington, finding that the claimant sustained a lumbar annulus fissure, considered to be a tear in fibrocartilage.  This is found to be a non-threshold injury. 

View decision

Merit Review

Schmahl v AAI Limited t/as GIO [2023] NSWPICMR 44

Merit Reviewer: Katherine Ruschen

Merit review – dispute about payment of weekly benefits – whether downturn due to COVID can be accounted for – whether ongoing business expenses accounted for – insufficient information to accurately determine pre-accident weekly earnings (PAWE).

The claimant made a claim for statutory benefits in relation to an accident that occurred on 17 March 2023. The matter was brought before the Commission with regards to a dispute between the parties about the payment of the claimant’s PAWE.

The insurer determined the claimant’s PAWE was $298.42 on the basis of the claimant being the sole proprietor of a driving school business.

The claimant lodged an application with the Commission disputing the insurer’s decision.

The parties agreed that there was no dispute that the claimant was an earner for the purposes of the Act, with the crux of the dispute being the amount of gross earnings received by the claimant in the 12-month pre-accident period.

The claimant did not file submissions in support of their application; however, the Merit Reviewer was able to surmise the following issues for determination:

• whether the payment of weekly statutory benefits could include an amount to cover ongoing business expenses while the claimant was unable to work
• whether the claimant’s PAWE could be adjusted to account for a downturn in business due to COVID-19, and
• whether the payment of statutory benefits could include losses such as the alleged loss of the claimant’s motor vehicle used for business purposes.

In reply, the insurer submitted that more information was required to accurately determine PAWE and sought a direction from the Commission that the claimant provide further documents, namely complete bank statements for the pre-accident period and a schedule of business income expenses.

The Merit Reviewer identified that sch 1 cl 4 of the Act required a determination of the claimant’s gross earnings received as an individual earner, which would equal the net income of the claimant’s business, being the gross business income less any expenses.

Similarly, the Merit Reviewer held that the Act did not contain any provisions that permitted PAWE to be adjusted upwards to include an allowance for ongoing business expenses after the accident, even if the claimant remained unfit to resume full pre-injury employment. The Merit Reviewer emphasised the variable nature of business expenses, opining that a claimant who wound up their business could theoretically obtain a windfall if statutory benefits were permitted to include post-accident business expenses. Accordingly, the Merit Reviewer dismissed this ground of review.

Moreover, the Merit Reviewer held that the Act did not permit an adjustment of PAWE to account for business downturns due to COVID-19. Consistent with the decision in Allianz Insurance Australia Limited v Shahmiri [2022] NSWSC 481, the Merit Reviewer held that PAWE could only be calculated by dividing the claimant’s earnings in the 12-month pre-accident period by 52 weeks, with no scope to account for external factors including COVID-19.

In determining the claimant’s PAWE, the Merit Reviewer agreed with the insurer that there was presently insufficient evidence to make an accurate determination. The Merit Reviewer found that the claimant’s provided tax return and business profit and loss statement, while useful, did not facilitate a reliable calculation of PAWE, and accordingly affirmed the determination in the insurer’s internal review. Nonetheless, the Merit Reviewer identified that the claimant was permitted to provide further documents to the insurer, in which case the insurer would be required to re-determine the claimant’s PAWE.

Furthermore, the Merit Reviewer held that the claimant was not entitled to recover the costs of damage to her motor vehicle through statutory benefits, with the Act providing no scope to make such adjustments. The Merit Reviewer held that the Act only permitted funeral expenses, loss of income and costs of medical treatment to be accounted for in the payment of statutory benefits. Instead, the Merit Reviewer noted that the claimant could seek to recover these costs through a claim under her first party motor vehicle property insurance.

Findings: The Merit Reviewer affirmed the insurer’s internal review determination of the claimant’s PAWE, amounting to $298.42. Further, the Merit Reviewer directed the claimant to provide further documents to the insurer, who would then be required to make a new determination of the claimant’s PAWE.

View decision