Two recent decisions of the Victorian courts could add to an already concerning trend of claims inflation evident in Victorian personal injury claims. Both address elements of personal injury claimants’ entitlements to ‘Non-economic loss’ damages (also known as pain & suffering or General Damages). The decisions each address a distinct and fairly technical point around the way the Medical Panel works.
The Medical Panel is an expert panel of specialists which assesses a claimant’s injury to determine whether his or her impairments claim satisfy the ‘Whole Person Impairment’ threshold required to make a non-economic loss claim. This is important as that element of their claim can form a significant part of their entitlement to damages. The Medical Panel does not determine the award to be made – that is at the discretion of the Court – but merely whether an entitlement exists.
The first of these decisions is Arik v Vicinity Centres PM Pty Ltd  VSC 94which addressed the method used by the Panel to assess impairments. In this decision Richards J found that the “range of motion” method of impairment assessment (which involves measuring restriction in the movement of the hip, knee, ankle or toe joints) is to be carried out by adding up multiple impaired movements of each joint. Prior to this judgment, doctors and Medical Panels only rated impairment based on the single most impaired movement in the joints of the lower limbs.
The effect of this decision is that in the future, claimants with certain lower extremity injuries are likely to have their whole person impairment assessed higher than they would have prior to the judgment. That in turn may significantly expand the number of claimants who establish an entitlement to non-economic loss damages. It is also an interesting development for the Court to interfere in an administrative function set out in legislation.
The second decision is Rosata v City of Melbourne & Anor  VCC 630. This County Court decision cast into question a long-standing practice in cases with multiple defendants where a later respondent to a claim could make its own referral to the Medical Panel even where a determination by the Panel had already been made. That could lead to the slightly incongruous outcome where the claimant could pursue a non-economic loss claim against one defendant but not the other notwithstanding the claim against each was for the same incident and the same injury. In these circumstances the Medical Panel might make a determination in the second referral that the impairments claimed did not meet the threshold even if it had already made the opposite determination in response to the first referral.
In Rosata Judge Fraatz found that a later defendant is bound by an earlier determination by the Panel that the claimed impairment satisfies the threshold level. On the face of it this seems logical given the intent of Medical Panel referrals was to lend a degree of objectivity to determinations of whether an injury claimed is a ‘significant injury’. One would hope that the same logic would apply to the inverse scenario so a claimant is prevented from having ‘two bites of the cherry’, ie a determination from the Panel that the threshold is not satisfied should bind the claimant as against all defendant, including any added to proceedings at a later stage.
Leaving that question aside, the impact of Rosata arguably also expands the number of claims where the threshold is met. It is not difficult to envisage a scenario where a claimant convinces the Medical Panel he or she has a significant injury but the Court decides the defendant who made the referral is not liable and, in the same matter, liability is found against a defendant which is found liable to the claimant.
Almost 20 years after tort reform swept Australia, Plaintiff firms continue to chip away at constraints on entitlements to bring personal injury claims. For its part the Judiciary seems open to hear these challenges to what had seemed settled areas of law. These developments seem likely to add significant inflationary pressures already evident in personal injury claims.