'Forget the Lifetime Care and Support Scheme, I want the money' – Lump sum payments not an option where claimants are eligible – Nominal Defendant v Adilzada [2016] NSWCA 266

The claimant suffered a traumatic brain injury as a result of a motor vehicle on 18 October 2007. He subsequently brought a claim against the Nominal Defendant (the defendant) for damages. Between the date of accident and December 2012, no steps were taken by the claimant to apply for participation in the Scheme despite his traumatic brain injury meeting the eligibility criteria.

In December 2012 the defendant made an application for the claimant to become a participant in the Scheme and on 9 January 2013 the Lifetime Care and Support Authority (the Authority) notified the claimant that he had been accepted as an interim participant.

The period of the claimant's interim participation in the Scheme expired on 9 January 2015. Despite the Authority requesting the claimant attend further assessments for lifetime participation in the Scheme, the claimant did not respond and his participation in the Scheme lapsed.

The claimant thereafter failed to respond to the defendant's request to undergo a medical examination for assessment of eligibility for lifetime participation in the Scheme and on 9 April 2015 the defendant filed a Notice of Motion in the District Court of New South Wales (the District Court) seeking an order, inter alia, that the claimant submit to a medical examination for assessment of eligibility as a lifetime participant in the Scheme.

The motion was heard before Elkaim DCJ on 10 March 2016. The claimant submitted that there were cultural reasons for his family not wanting attendant care workers coming into the family home and it was preferred that the family provide assistance to the claimant. The defendant argued that the words of s 86 of the MACA were sufficiently broad, when read with a view to the intention of Parliament, to mean that all eligible persons should be participants in the Scheme to enable an insurer to obtain the assessment it requires to apply for the claimant to be admitted as lifetime participant in the Scheme.

Further, the defendant argued that eligibility for participation in the Scheme, where participation is in dispute, is an integral element of the claimant's entitlement to damages. To that extent, third party premiums were modified when the Scheme was introduced, the Scheme being funded by a levy and not premium collected by insurers. The balance between the decrease in third party premiums and the imposition of the levy can only be maintained if all those persons eligible for participation in the Scheme become Scheme participants.

His Honour accepted that there is no enforcement section in either the MACA or the LCSA to compel an unwilling claimant to attend the medical examination for the purpose of an application to the Authority. His Honour found that the plain language of s 86 and its location in pt 4.3 of the MACA concerning duties of the parties in connection with a claim for damages allowed no scope for an interpretation which would permit any application of the section to the Scheme, payments made to participants in the Scheme for care and treatment not being damages.

The defendant appealed the decision to the New South Wales Court of Appeal (the Court of Appeal).

In a unanimous decision lead by Meagher JA, the Court of Appeal upheld the appeal finding that an insurer or a person against whom a motor accident claim is made may under s 86(1) of the MACA request that a claimant undergo a medical examination or assessment for the purpose of determining their eligibility for participation in the Scheme. The Court of Appeal found that if a claimant fails without reasonable excuse to comply with such a request, court proceedings cannot be commenced or continued in respect of the claim where the failure continues.
His Honour addressed the interplay between the MACA and the LCSA, stating:

The Court of Appeal's decision clarifies what steps an insurer can take to ensure eligibility for participation in the Scheme is determined before any assessment of a claimant's damages occurs. The mere fact that a claimant may perceive the benefits of them participating in the Scheme as being inadequate, or that they have a preference for the receipt of a lump sum payment as opposed to the ongoing provision of attendant care services, is a matter beyond their control if the eligibility criteria is met. As noted by the High Court of Australia in Daly v Thiering³ it is "open to the CTP insurer of a claim to override a choice by an injured person not to become a participant in the Scheme"⁴ and that the "legislative package consisting of the [LCSA] and s 130A of the [MACA]"⁵ confers a 'choice' on the insurer that an eligible person become a participant in the Scheme.

Where insurers are experiencing difficulties in having a claimant's eligibility for participation in the Scheme assessed, s 86 can now be invoked with an appropriate sanction on the claimant should the failure to attend a medical examination or assessment continue.

Further, an insurer faced with a claimant resisting assessment for participation in the Scheme on cultural grounds may rely on pt 18 of the Lifetime Care and Support Guidelines, which permits the Authority's consideration of whether special circumstances exist to justify payment of a non-approved provider of attendant care services in those circumstances.