Do I Have To Go To Court To Receive Compensation?
Smalley v Motor Accidents Authority of NSW
Following the success that Mr Smalley enjoyed in his Court of Appeal victory, the Motor Accidents Authority issued amended Claims Assessment Guidelines which were gazetted on 11 April 2014. The intent of the amendments is that CARS be given the ability to determine liability disputes where a CARS Assessor is of the opinion that course is appropriate.
In Smalley, the Court found by inference that where an insurer denies liability then fault is necessarily denied and the Claimant is entitled to an exemption. The amended Guideline that deals with this exemption entitlement is 8.11.1, which reads as follows:
“Liability is expressly denied by the insurer, in writing, but only in circumstances where liability is denied because the fault of the owner or driver of a motor vehicle in the use or operation or the vehicle is denied.”
Mr Smalley complained that because the insurer denied liability, the insurer was not required to meet his medical expenses as they were incurred or comply with any of its other obligations under the Act. The insurer was, in effect, having its cake and eating it too.
The other difficulty with a CARS Assessor determining a liability dispute is that the finding is not binding upon the insurer. That is of course not the case where liability is admitted (see s95(2) of the Motor Accidents Compensation Act).
Where a Claimant is forced to commence court proceedings because the insurer will not pay the CARS Award, legal costs payable by the insurer are capped. Fortunately, that predicament was remedied to a considerable extent as a result of the Motor Accidents Compensation Regulation 2015. Generally, as a result of that Regulation, if an insurer does not accept liability then it is required to pay all of the Claimant’s costs incurred after the CARS Certificate. This should provide a disincentive for insurers not accepting a CARS Award.
It is clear that many liability disputes will now be heard and determined by CARS. That is not of itself a difficulty for Claimants because the CARS assessment process generally provides a swift and economic answer to a claim. The difficulty however arises that insurers are not bound by the CARS Award which may force a Claimant to then commence court proceedings on the claim. Hopefully the obligation on the insurer to pay indemnity costs in that circumstance will make insurers think twice before refusing to pay a CARS Award.
Do I have to go to Court to receive compensation?
This will depend, in fault denied matters, whether the insurer accepts the determination of damages by CARS.