CERTIFICATE OF DETERMINATION OF MEMBER  	

Citation:	
Payne v Allianz Australia Insurance Limited [2022] NSWPIC 673	
		
Claimant:	Adam Robert Payne	
		
insurer:	Allianz Australia Insurance Limited	
		
Member:	Shana Radnan	
		
DATE OF DECISION:	11 December 2022	
		
CATCHWORDS:	MOTOR ACCIDENTS - Claims assessment matter; claim for damages was referred to the Personal Injury Commission under Division 7.6  of the Motor Accident Injuries Act 2017 (2017 Act) for assessment; no evidence provided when claim was lodged three days before expiry of limitation period; insurer disputed genuine attempt to settle; whether the claimant had complied with section 7.32(3) of the 2017 Act by requesting a settlement conference; meaning of “best endeavours”; whether proceedings should be dismissed; Held – for the purposes of section 7.32(3) of the 2017 Act the claimant failed to use his best endeavours to settle the claim before referring it for assessment under Division 7.6 of the 2017 Act; proceedings dismissed in accordance with section 54 of the Personal Injury Commission Act 2020. 	
determinations made:	1.	For the purpose of s73.2(3) of the Motor Accident Injuries Act 2017 the claimant failed to use his best endeavours to settle the claim before referring it for assessment under Division 7.6 of the Motor Accidents Injuries Act 2017.
2.	The proceedings are dismissed in accordance with s 54 of the Personal Injury Commission Act 2020.	

Reasons for Decision
Introduction
1.	On 10 September 2019 Adam Robert Payne (the claimant) contends he was involved in a head on collision sustaining injuries and disabilities and brings a claim for damages.
2.	An application for common law benefits was lodged with the insurer on 25 August 2022. 
3.	An application for claims assessment was lodged at the Personal Injury Commission (Commission) on 3 September 2022 ( the “proceedings”). At the time of the application was lodged, the claimant submitted the application is made to preserve the three year limitation period and that the matter is not ready for assessment and seeks the matter be placed into the not ready /stood over list.
4.	The insurer’s liability decision was due 25 November 2022. 
5.	The insurer has submitted that the claimant’s non-compliance with s 7.32(3) is grounds for the application to be dismissed. 
Teleconference
6.	A teleconference held on 28 October 2022 took place and parties were directed to provide further submissions. The claimant by 14 November 2022 and the Insurer by 7 December 2022. Due to the claimant seeking a further extension the Insurer’s further submissions were due on 14 December 2022.
7.	The claimant lodged submissions dated 18 November 2022 October 2021 (document AD1).
8.	On 14 December 2022 the insurer lodged further submissions (document AD2).
9.	The insurer confirmed on 2 December 2022 that no further submissions would be forthcoming.
10.	The insurer argues that the proceedings should be dismissed because of the claimant’s failure to comply with s 7.32(3) of the Motor Accident Injuries Act 2017 (MAI Act). That provision requires parties to a claim to use their best endeavours to settle the claim before referring it for assessment under Division 7.6 of the MAI Act.
11.	The claimant confirmed when lodging his application that the matter was not ready for assessment as the claimant required time to obtain the necessary medical and other evidence to establish the claim. 
12.	In the event the claim was not dismissed, a further request was made that the matter be placed in the stood over list. 
13.	The critical issue for determination is whether the claimant failed to comply with 
s 7.32(3) and, if so, what flows from that failure.
On the papers
14.	Having considered both s 52 of the Personal Injury Commission Act 2020 (PIC Act) and Procedural Direction PIC2 I have concluded that the proceedings can be determined on the papers. I am satisfied that sufficient information is available in connection with the proceedings to allow me to determine the dispute without holding a formal hearing. Both parties were given opportunity to make further submissions before determination took place.
Legislative framework
15.	Section 7.32 of the MAI Act is in the following terms:
“7.32 Reference of claim 
(1) 	A claim for damages may be referred to the Commission by the claimant or the insurer, or both, for assessment under this Division.
(2) 	(Repealed)
(3) 	Parties to a claim must use their best endeavours to settle the claim before referring it for assessment under this Division.”
16.	Section 7.33 states as follows:
“7.33 Time limits for referring claims and making assessment 
A party to a claim cannot refer a claim for assessment under this Division more than 3 years after the motor accident concerned unless the party provides a full and satisfactory explanation for the delay to the Commission and the Commission grants leave for the claim to be referred for assessment in accordance with the Commission rules.”
This provision has now been repealed as at 28 November 2022. There is no longer a 3 year limitation period in referring a claim to the PIC. A claim can now be made at any time.  There is still a three year limitation period applicable to commencing court proceedings.
17.	The objects of the MAI Act are found in s 1.3(2) of that Act as follows:
“1.3 Objects of Act 
(2) 	For that purpose, the objects of this Act are as follows—
(a) 	to encourage early and appropriate treatment and care to achieve optimum recovery of persons from injuries sustained in motor accidents and to maximise their return to work or other activities,
(b) 	to provide early and ongoing financial support for persons injured in motor accidents,….
(g) 	to encourage the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes,…”
Insurer’s submissions
18.	The circumstances of the accident are unusual to say the least and will require further investigation. A liability notice has been issued on 22 November 2022. The insurer determined:-
“The letter is to advise that we have insufficient information upon which we can make a final determination on liability”.
Why the decision was made:
“We understand the accident circumstances to be as follows:
The Insured driver is Saiesha Moodley. We understand that you and the Insured driver were involved in a head on collision on Blacktown Road at approximately 12:30 pm on 10 September 2019. You were travelling in a southerly direction on Blacktown Road, whilst the Insured driver was travelling north.
At this stage, we are uncertain as to where on the road, that is, the southbound lane or the northbound lane, the impact occurred.
We note Police did not attend but the accident was reported to them the following day.
Ms Moodley provided us with a document purportedly signed by you and herself in which it is agreed that each of you were equally responsible for the impact. We have sent a copy of that to your solicitors under cover letter dated 27 September 2022 asking for verification. That has not yet been provided. If it is a legitimate document, then we would like further information as to when and why it was signed.
We are also conducting other liability investigations.
We have requested our investigators contact you, through your solicitors, for an interview as to what occurred.
Accordingly, we are not presently in a position to determine liability. Our decision will be reviewed as further information comes to hand.”
19.	There are also issues as to injuries which need to be investigated.
20.	The claimant’s solicitors have provided the following submissions under the heading “readiness for assessment”:
•	The application has been lodged to protect the claimant’s three year limitation rights noting we have recently been instructed to act on behalf of the claimant.
•	As such, we request the matter be referred to the stood over list to allow the claim to be evidenced accordingly.
21.	There have been no settlement negotiations prior to the application being lodged.
22.	The claimant should have the benefit of the liability notice and clarity around the injuries before making a decision as to whether he intends to proceed with the claim at all.
23.	The insurer asks that the application be dismissed due to a failure to comply with s 7.32(3) of MAI Act.
Power to dismiss
24.	The dismissal power is found in s 54(b) of the PIC Act which provides that the Commission may at any stage dismiss proceedings if it is satisfied that the proceedings are “frivolous or vexatious or otherwise misconceived or lacking in substance”.
25.	This has been found to include a non-compliance with s7.32(3) of the MAIA. Mammone v Insurance Australia Limited t/as NRMA [2021] NSWPIC 501.
26.	The insurer submitted the term “lacking in substance” also encompasses the situation where a claimant has commenced proceedings prematurely, so as to stave off the limitations period, in circumstances where there is an unresolved dispute as to whether the claim may not actually be available.
27.	Medical Assessor Broomfield in a 2020 decision of AQM v NRMA (Claims Assessment) [2020] NSWSIRADRS 238 (27 October 2020) considered he had power to dismiss a non- compliant application on the basis that it was incompetent and therefore there was no dispute before him.
28.	The insurer noted the recent decision of Member Castagnet in Milla v Transport Accident Commission [2022] ASPIC 127 (22 March 2022) wherein he determined that he had no power to dismiss a matter for non-compliance with s 7.32(3).
29.	The insurer submitted he is incorrect, and that s 54(b) provides the power. Otherwise s 7.32(3) would be unenforceable, which would be contrary to one of the stated objects of the scheme “to encourage the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes”.
Best endeavours
30.	Section 7.32(3) mandates that parties to a claim must use their best endeavours to settle the claim before referring it for assessment under Division 7.6.
31.	The fact that a three year anniversary is approaching does not excuse a claimant from compliance with s 7.32(3). Nor does the fact that the claimant has only recently obtained legal advice. Procedural Direction MA1 does not justify such a default - one must still comply with the enabling legislation (which in this context is MAI Act).
32.	The term “best endeavours” has not been judicially considered, but there are several decisions of the Commission on the issue which establish that the obligation to use best endeavours is measured by what is reasonable in the context. AQM v NRMA (Claims Assessment) [2020] NSWSIRADRS 238.
33.	The requirement has been usefully summarised by Member Brett Williams in Mammone v NRMA, [2021] NSWPIC501 as follows:
“I consider that what constitutes “best endeavours”, for the purposes of s 7.32(3), must depend on the circumstances of each claim. The provision may not require an offer of settlement to be made in every case. It can be envisaged that, in some circumstances, the provision of particulars and evidence in support of a claim for damages may be found to satisfy the “best endeavours” requirement. Different considerations may also arise in claims that cannot be made before the expiration of 20 months after the accident, in accordance with s 6.14(1).
The insurer contends for a construction of s 7.32(3) on the basis that the obligation to use “best endeavours” requires a party to act honestly, reasonably and make a positive effort to settle the claim before referring it for assessment even where success is unlikely.
I agree with the construction of s 7.32(3) contended for by the insurer. In my view, it allows the flexible application of the provision on a case by case basis and in a “manner that is consistent with the objects of the MAI Act. In particular, I consider that this construction furthers the stated object of encouraging the early resolution of motor accident claims and the quick, cost effective and just resolution of disputes. It does this by requiring the parties to take reasonable steps to settle the claim before referring it for assessment.”
34.	I was referred to my own decision where I had adopted a similar formulation in Keriakos v NRMA [2022] NSWPIC101 (10 March 2022). 
35.	The decision in Joseph Street Pty Ltd v Tan, [2012] VSCA 113; (2012) 38VR241 the Court considered that to use “best endeavours” requires a party to do all they reasonably can in the circumstances to achieve the purpose of the obligation. The Court further considered a number of authorities and interpreted “best endeavours” as requiring a party to:
(a)	do all it can reasonably do to act in the same manner as a reasonable and prudent party would act if it was acting in its own interests to achieve a certain object;
(b)	do the acts required to achieve the object with the same vigour expected of a party attempting to secure its own interests until the party reasonably considers that further attempts to achieve the object of the obligation would have a remote chance of succeeding, and
(c)	within reason, act in a manner so as to leave no stone unturned to achieve the object.
36.	Similarly in Golding v NRMA [2021] NSWPIC98 (13 Dec 2021) Member McTegg formulated the test as follows:
“It seems that what is required of the claimant was to do all she reasonably could in the circumstances to attempt to achieve a settlement of her claim, or to take steps which a prudent, determined and reasonable person acting in her own interests and desiring to achieve a settlement would take.”
Injuries alleged 
37.	The insurer submitted it is noteworthy that in the claimant’s application for personal injury benefits which is dated 19 September 2019, the injuries are alleged to be broken knuckle and rotated finger on right hand, bruised knee, sore right shoulder, arm and leg. A Medical Certificate was provided with the application from a Dr Ya. This is merely a certificate completed 13 September 2019 certifying the claimant unfit for work from 10 September 2019 until 8 October 2019. It said that the claimant was suffering from a right hand fracture.
38.	It referred to the first Medical Certificate/Certificate of Work Capacity was completed by Dr Ya on 7 November 2019. The injuries therein are right index finger, metacarpal head fracture.
39.	The schedule of damages attached to the application to the Commission to assess general damages however refers to more extensive injuries and disabilities including allegation of head injury with concussion, fractured finger, knuckle, nerve damage to the right arm, soft tissue damage to the right arm, nerve damage to the left arm, soft tissue damage to left arm, left shoulder, soft tissue damage to right shoulder and psychiatric injury.
40.	The matter was not ready to be assessed for many reasons:
(a)	The claimant alleges a variety of disabilities and makes a substantial claim for damages.
(b)	The alleged circumstances of the accident are that the claimant and the Allianz insured driver, for presently unknown reasons, collided head on in the middle of Blacktown Road.
(c)	The insurer submitted that further investigations need to be made on liability. The liability decision of 22 November 2022 contemplated that ongoing investigations are required in particular noting a joint letter signed by the claimant and insured’s driver both agreed they equally contributed to the accident, which has yet to be verified.
(d)	A photograph has been provided of the two vehicles it seems in situ after the impact. It is clear that both airbags deployed.
(e)	The insurer submitted that a causation issue arises as to how the claimant could have sustained a fractured right finger, let alone the other injuries.
(f)	These need to be explored by medical doctors and possibly through an ergonomic assessment. There is no evidence contained in the application.
41.	The alleged additional injuries in the application will need to be fully ventilated by the claimant and explored before a meaningful opportunity to settle can be effected.
42.	There is a lot of evidence that needs to be collated, which is conceded by the claimant’s solicitor in his application.
Objects of MAI Act and the PIC Act
43.	Section 42(5) of the PIC Act states that nothing in that section “requires or permits the Commission to exercise any functions that are conferred or imposed on it under enabling legislation and in a manner that is inconsistent with the objects or principles for which that legislation provides in relation to the exercise of those functions”.
44.	Given the use of the word “must” in s 7.32(3), the legislature clearly considered that the requirement to use best endeavours to resolve a claim prior to lodgement was integral to the scheme. Moreover, having regard to the interplay between s 7.32(3) and s 7.33, there was an intention that this whole process ought to occur prior to the three year anniversary.
45.	Sections 7.32(3) is therefore an important aspect by which the third party scheme seeks to "encourage” the early resolution of claims.
46.	Placing undue consideration on the expiration of the three year limit creates the hazard that as long as parties can delay for long enough, there will be no adverse consequences for non-compliance with an important aspect of the scheme.
47.	There are simply too many unknowns in this matter and a lot of evidence which needs to be obtained before the claim can proceed, should in fact the claimant choose to do so and if he does proceed with the claim the parties should first attempt a resolution of the matter.
48.	The proper remedy in this situation is not to allow proceedings to remain on foot which otherwise ought to be dismissed for non-compliance with s 7.32(3). 
Claimant’s submissions
49.	The claimant’s submissions were as follows:-
(a)	The claimant was unrepresented in his claim until 25 August 2022 when he retained his current solicitors, CMC Lawyers. 
(b)	On 29 August 2022 the claimant made a claim for common law damages.
(c)	On 29 August 2022 the claimant provided the insurer with s 6.25 particulars and appointed a settlement conference to take place on 1 September 2022. 
(d)	On 30 August 2022 the claimant’s solicitors requested the Insurer to concede the threshold for permanent impairment.
(e)	On 31 August 2022 the insurer advised the claimant that they will not participate in an informal settlement conference as they do not consider the subject claim is ready for settlement .
(f)	Section 7.32 (3) provides that the parties must use their “best endeavours” to settle the claim before referring it for assessment to the Commission.
(g)	An application to the Commission was made on 5 September 2022 for common law damages to be assessed.
50.	The claimant’s solicitor has taken all relevant steps to comply with s 7.33 of the MAI Act.
Determination
51.	It is not in dispute that the claimant lodged his claim for common law damages with the insurer on 25 August 2022.
52.	The claimant lodged his application for assessment of damages with the Commission on 6 September 2022 three days before the third anniversary of the motor vehicle accident.
53.	The claimant approached the insurer on 30 August 2022 to hold a settlement conference on 1 September 2022 two days after it provided particulars of the claim with no supporting evidence.
54.	The claimant’s particulars of the claim were dated 29 August 2022 listing injuries and disabilities and a schedule of damages as follows:
“Particulars of Injuries Received
1.	Head injury;
2.	Concussion;
3.	Fracture to right index finger;
4.	Fracture to right knuckle;
5.	Nerve damage to right arm;
6.	Soft tissue damage to right arm;
7.	Nerve damage to left arm;
8.	Soft tissue damage to left arm;
9.	Soft tissue damage to left shoulder;
10.	Soft tissue damage to right shoulder; and
11.	Psychiatric injury.
Particulars of Continuing Disabilities & Impairments
1.	Headaches;
2.	Pain to right arm;
3.	Restricted movement to right arm;
4.	Pain to right index finger;
5.	Restricted movement to right index finger;
6.	Difficulty with carrying;
7.	Difficulty with grip;
8.	Difficulty with driving;
9.	Pain to left arm;
10.	Pain to left shoulder;
11.	Difficulty moving left shoulder;
12.	Difficulty lifting more than light weights;
13.	Difficulty with memory;
14.	Anxiety; and
15.	General bodily psychological trauma.”
55.	There were no medical records or any primary documentation provided to the insurer with the application merely the list of injuries.
56.	Economic losses were also claimed as past $102,700 at the rate of $790 for 130 weeks and future losses contemplated a buffer of $350,000.
57.	There were no primary financial records or tax records produced to provide evidence to support the claimed loss of earning capacity, merely a calculation of losses claimed. There was no medical evidence submitted to evidence loss of earning capacity.
58.	The claimant provided scant information and followed it with a request to the insurer that it concede that the claimant’s injuries exceeded the statutory threshold of 10% whole person impairment without a scintilla of evidence to establish the injuries exceeded the relevant threshold prescribed by the Act.
Best endeavours
59.	Section 7.32 is set out in full earlier in these reasons. The provision is found in Sub-division 2 of Division 7.6 of the MAI Act. That Division deals with the assessment of claims for damages. It is found in Part 7 of the MAI Act, which contains provisions in relation to dispute resolution.
60.	Section 7.32(3) is in clear and unambiguous terms and mandates certain action: parties to a claim must use their best endeavours to settle the claim before referring it for assessment under Division 7.6. 
61.	The Australian authorities referred to by the insurer suggest that “best endeavours” clauses are now judged by standards of reasonableness and the obligation to use best endeavours is measured by what is reasonable in the circumstances, and in consideration of the nature, capacity, qualifications and responsibilities of the person who owes the obligation. Notions of reasonableness and context are, in my view, the critical considerations that emerge from these authorities. They are considerations that should be applied when determining what the term “best endeavours” means for the purposes of s 7.32(3).
62.	The insurer submitted the claimant did not use his best endeavours at all to settle the claim before referring it for assessment. I agree with the insurer that the approach to the insurer the day after the claimant provided basic particulars and a few days prior to the expiration of a limitation period with a paucity of evidence is not a best endeavour to settle the matter.
63.	The intention and provisions of the Act are that the parties in using best endeavours would at the very least provide sufficient evidence to support the ambit of the claim, the nature of the injuries and medical evidence to establish the basis of the claim.
64.	The actions of the claimant in this matter were taken merely to preserve the rights of the claimant in relation to a limitation period. It was clear to the claimant the matter was not ready for assessment as the application included a request for the matter to be placed into the stood over list on the basis it was not ready to be assessed.
65.	Similarly, providing the insurer with a claim and not enabling the insurer time to investigate and obtain medical evidence or opinion in reply is not a genuine attempt to resolve any dispute as the ambit of the dispute is unknown.
66.	I agree with the insurer’s submission that the fact the three year anniversary of the accident was approaching when the claimant commenced the proceedings in PIC did not expressly nor impliedly excuse him from compliance with s 7.32(3).
67.	The claimant should have marshalled sufficient medical evidence and other evidence to support the heads of damage being claimed. 
68.	In these circumstances, I find the claimant has made an application lacking in substance and commenced the proceedings prematurely. The provision of s 7.32(3) mandate that the parties must use their best endeavours to settle the claim before referring it for assessment under Division 7.6
69.	By failing to provide any evidence to support the claim, the claimant did not take reasonable steps to settle the claim before referring it for assessment. The claimant’s actions of simply making a request to the insurer to participate in a settlement conference before commencing these proceedings was insufficient to establish that his conduct satisfied the requirements of s 7.32(3). 
Consequences of the claimant’s failure to comply with s 7.32(3)
70.	The consequence of the claimant’s failure to comply with the mandatory obligation in s 7.32(3) is that the proceedings should be dismissed. The specific dismissal power relied on by the insurer is found in s 54(b) of the PIC Act. It is contended that the proceedings are otherwise misconceived or lacking in substance because they have been commenced in circumstances where there has been both substantive and temporal non-compliance with s 7.32(3). That being so, the matter cannot progress any further as the non-compliance cannot be cured by any other provisions.
71.	The dismissal of the proceedings does not mean the claimant is necessarily disentitled from lodging a further application in the Commission in the future. Noting the repeal of s 7.33 of the MAI Act from 28 November 2022, the recent amendments to the Act no longer requires the claimant to seek leave to make an application to the Commission after the three year anniversary of the accident. 
Orders
72.	For the purposes of s 7.32(3) the claimant failed to use his best endeavours to settle the claim before referring it for assessment under Division 7.6 of the MAI Act.
73.	The proceedings are dismissed in accordance with s 54 of the PIC Act.