Summary

Following the commencement of the Wrongs Act Amendment Act 2015 (Amending Act) lawyers have grappled with its ostensible 'retrospectivity'. Specifically, the Amending Act purportedly affords potential litigants who had previously failed at the Medical Panel the chance to have a 'second-go' at claiming general damages for non-pecuniary loss.

In this eBulletin, we review the recent decision of Stapleton v Central Club Hotel & Ors1 (Stapleton) and what it means for you.

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On 27 November 2010, Eileen Stapleton suffered an injury to her right knee at a Hotel in Richmond. The plaintiff was admitted to Hospital where she underwent surgery on her knee. Following the surgery, whilst still under the effects of anaesthesia, Ms Stapleton was mobilised and fell again allegedly causing further injuries. Relevantly, Ms Stapleton alleges that she suffered a psychiatric injury as a result of the second fall.

Part VBA of the Wrongs Act 1958 establishes certain thresholds for claiming general damages for non-pecuniary loss. For example, Part VBA required, "in the case of psychiatric injury, a total whole person impairment of more than 10 per cent or greater".2

A plaintiff wishing to claim general damages must serve a Certificate of Assessment stating that their injury meets the threshold. Any defendants to the plaintiff's claim then have the opportunity to refer the plaintiff to the Medical Panel for assessment as to whether or not the plaintiff satisfies the threshold level. The determination of the Medical Panel is binding on a Court.

The defendants in Ms Stapleton's case referred her to the Medical Panel, which found that her degree of psychiatric impairment did not meet the threshold of 10%.

The Amending Act commenced operation on 19 November 2015 and changed the Wrongs Act thresholds with purportedly retrospective application. In the case of psychiatric injury, the Amending Act [subtly but significantly] changed the threshold from 'more than 10%' to '10% or more'. Accordingly, where a plaintiff with an impairment of 10% would not have previously satisfied the old threshold, they would now satisfy the new threshold.

Moreover, the Amending Act provided that the change in threshold applies irrespective of when the act or omission causing the injury or giving rise to the claim for recovery of damages occurred and to claims that have not been finally settled or determinedbefore 19 November 2015.

As such, the Amending Act raised the question whether prospective plaintiffs who had previously failed at the Medical Panel (and were therefore barred from claiming general damages), but had not yet finally settled or determined their claims, could serve a fresh certificate. Since the commencement of the Amending Act, this question has been on the mind of plaintiff and insurance lawyers alike, as it potentially affords a significant pool of litigants the opportunity to have a 'second-go'.

Ms Stapleton gave it a 'second-go' and served a fresh Certificate of Assessment, which was challenged by the defendants.

Justice Saccardo of the County Court found for the defendants, upholding the 'primacy' of the Medical Panel determination. His Honour relied on the provisions of the Interpretation of Legislation Act 1984 and found that "…the provision of the amending Act should not be interpreted as having retrospective application so as to displace the Medical Panel determination unless the amending Act demonstrates an express intention to do so…I am not satisfied that the provisions of the amending Act demonstrate an express intention…".

Accordingly, his Honour held that the decision of the Medical Panel which found that Ms Stapleton's psychiatric injury did not meet the threshold continued to have the effect of shutting the plaintiff out from any right to pursue a claim for non-pecuniary loss damages and the Amending Act does not entitle the plaintiff to rely upon the further certificate.

This decision provides much needed guidance on the application of the recent Amending Act. Insurers should be encouraged by this authority, which reiterates the primacy of previous Medical Panel determinations which shut out plaintiffs who did not meet the threshold.

It remains to be seen whether this decision will be appealed or otherwise challenged.