Injured Motor Accident Victims have recently had their lives made very difficult by some CTP insurers and their lawyers, who have been refusing to accept claimants’ explanations for the delay in litigating their claims on the basis that the explanations are neither satisfactory nor full, as the law requires them to be. The insurers’ aim is undoubtedly to deny innocent injured motor accident victims the monetary compensation they deserve and need.
What is meant by full and satisfactory?
On 26 October 2022, the New South Wales Court of Appeal handed down the decision of Stein v Ryden  NSWCA 212.
The decision confirmed what is, and what is not required for an explanation to be full and satisfactory.
The Stein case
In 2014, Ms Stein suffered serious injuries in a head-on collision in The Blue Mountains when a Victorian registered motor vehicle crossed onto its incorrect side of the road.
Ms Stein engaged lawyers to act for her. Within weeks of the accident Ms Stein’s claim for compensation was lodged with the Victorian insurer, namely, TAC. The insurer admitted liability.
For a number of reasons Ms Stein’s claim was not finalised within the normal time frame of about 2-3 years.
Ms Stein’s claim was well advanced, and on track to be settled, or determined by an Assessor of The Claims Assessment Resolution Service (CARS). Under the CARS system of assessing claims and awarding compensation, claimants were not permitted to litigate their claims in Court except in special circumstances. The outcome of the compensation claims had to be decided by CARS Assessors. The overwhelming majority of decisions made by CARS Assessors were final, which meant that extremely few CARS Assessors’ decisions ended up in Court.
Then, in early 2021, the process changed dramatically. On 1 February 2021 CARS was replaced by The Personal Injury Commission (PIC).
Due to this sudden change in procedure and the law, Ms Stein had to commence court proceedings in order to receive compensation. But, she first needed the District Court’s leave (permission), to do so. This is because Ms Stein’s claim involved a dispute with an interstate insurer, namely TAC in Victoria. (PIC does not have the power to exercise federal jurisdiction involving interstate insurers. In other words, PIC Assessors (Members) cannot decide the compensation outcomes in TAC claims).
The problem for Ms Stein (and many other claimants in a similar position) is that court proceedings technically have to be commenced within 3 years of the accident — in Ms Stein’s case in 2017! ( ie, 4 years before The PIC was even created).
Therefore, Ms Stein first had to provide TAC’s Sydney lawyer with a full and satisfactory explanation for not having commenced court proceedings by 2017.
Ms Stein’s explanation was that she was never made aware, nor did she know, of the 3-year limitation, until advised of this by her lawyer in 2021.
Surprising and disappointingly, given the sudden change from CARS to the PIC, TAC rejected the explanation, thereby also denying Ms Stein’s compensation claim. This was despite the fact that TAC had admitted liability many years earlier, and had actually engaged in settlement discussions with Ms Stein’s lawyers.
Ms Stein took the issue of her explanation to the District Court. She swore an affidavit stating that she had never been made aware of the limitation period by any lawyers, including counsel, who had acted for her and who had conferred with her on several occasions.
Her lawyer provided an affidavit attesting that his thorough review of Ms Stein’s file failed to reveal that she had been advised of the limitation period by any of the lawyers who had acted for her.
Neither Ms Stein nor her lawyer were cross-examined on their respective affidavits. The facts contained in their affidavits were therefore unchallenged by the insurer.
The acting District Court judge who heard the case rejected Ms Stein’s application for permission to file her compensation case in Court so that she would be finacially compensated for her injuries and financial losses. The rejection on the basis that not all the lawyers who had worked on Ms Stein’s case had provided affidavit evidence as to whether or not they advised Ms Stein of the limitation period. The acting judge found that Stein’s explanation, whilst satisfactory, was therefore not full.
Ms Stein appealed this decision in the NSW Court of Appeal.
The Findings on Appeal: What is a full and satisfactory account of the delay in a late motor accident claim?
The NSW Court of Appeal allowed Ms Stein’s appeal, thus restoring her entitlement to be compensated for her injuries and financial losses.
The Court of Appeal held that it was Ms Stein’s ignorance of the limitation period, and her evidence that she had never been made aware of it, which are the determinative factors. The Court found that Ms Stein had provided a sufficiently full explanation to enable an evaluation to be made whether it was satisfactory and that a reasonable person in her position would have been justified in experiencing the same delay.
The Judges of Appeal provided some current guidance about the statutory requirement of a full and satisfactory explanation for delay:
- A full and satisfactory explanation must provide a full account of the conduct, including the actions, knowledge and belief of the claimant from the date of the accident until the date of providing the explanation. It must be such that a reasonable person in the position of the claimant would have been justified in experiencing the same delay.
- What is required is an evaluative judgment or assessment as to whether, by reference to an objective standard and given the claimant’s position, the delay that occurred was reasonably justifiable.
- It is the claimant who is obliged to provide the explanation for the delay in commencing proceedings. The actions, knowledge and belief of a claimant’s solicitors are not required for a full and satisfactory explanation for delay
- If there is unchallenged evidence as to the injured person’s state of mind, it is unnecessary for that person to provide further evidence from individual solicitors who worked on cases to provide a full and satisfactory delay.
- The injured person’s unchallenged and therefore accepted evidence in this case was that Ms Stein was entirely unaware at all relevant times of any limitation requirements. That explanation was sufficiently full to enable an evaluation to be made of whether it was satisfactory in the sense that a reasonable person in the position of the application, who had no knowledge of the limitation period, would have been justified in experiencing the same delay.
- The need to look to the actions of persons other than the claimant, where those actions may form part of the position of the claimant, as in Nominal Defendant v Browne  NSWCA 197, must be read in the context of the circumstances of that case. In Browne, the evidence was that she could not remember the legal advice given. However, in Ms Stein’s case, the unchallenged evidence was that she had no knowledge or awareness of the limitation period.
TAC was ordered to pay Ms Stein’s costs of the appeal and the District Court proceedings.
The decision of Stein is a helpful refresher on the relevant statutory provisions and settled principles concerning late motor vehicle accident claims in NSW.
The Court of Appeal rejected the suggestion that evidence from all solicitors who work on an injured claimant’s matter are required for the purpose of a full and satisfactory explanation.
This decision, Stein v Ryden  NSWCA 212 will hopefully dissuade insurers from taking unfair advantage of technical cliches in NSW’s CTP scheme to avoid having to pay injured motor vehicle accident victims the compensation they deserve and need.
Stacks Goudkamp have the knowledge and experience to ensure that your motor vehicle claim is handled effectively. Tom and Karina fight for your rights and have successfully obtained compensation for thousands of people injured in traffic accidents. Please contact our office on 1800 25 1800 for a free initial consultation or contact us online.