Peter Hunt
Principal
CTP Insurance, Insurance
Can No Endeavours be Best Endeavours?
22 April, 2024
In Brief
- Section 7.32(3) of the Motor Accident Injuries Act 2017 (MAIA) requires the parties to use their best endeavours to resolve a claim for damages before lodging a damages dispute with the Personal Injury Commission (PIC).
- Compliance with s 7.32(3) is mandatory and failure to exercise best endeavours may result in dismissal of the PIC proceedings.
Facts
The PIC published its decision in Kaur v Transport Accident Commission [2024] NSWPIC 177 on 19 April 2024.
The Claimant was injured in a motor accident on 25 August 2018. She made a claim for statutory benefits on 25 March 2019.
The claim languished, however, until December 2022 when the Claimant was diagnosed with a dissecting basilar artery aneurysm.
The Claimant lodged a claim for damages under common law with the relevant insurer on 3 February 2023. She lodged a damages dispute with the Personal Injury Commission (PIC), shortly afterwards, on 20 February 2023.
The Insurer applied to have the PIC proceedings dismissed because the Claimant had failed to use her best endeavours to settle her damages claim before commencing PIC proceedings..
The Member’s Reasons
The PIC Member dismissed the damages dispute in the PIC for the following reasons:
- Section 7.32(3) requires the parties to use their best endeavours to settle the claim before referring the damages dispute to the PIC for assessment.
- Compliance with s 7.32(3) is mandatory given the word “must” in the provision.
- The legislature clearly considered it integral to the scheme that the parties use their best endeavours to resolve claims before they are referred to the PIC for assessment.
- This construction sits comfortably with the object stated in s 1.3(2)(g) to encourage early resolution of claims.
- The Claimant failed to use her best endeavours to resolve the claim before commencing PIC proceedings given that she offered no invitation to engage in settlement negotiations and made no offer of settlement to the Insurer.
Key Learnings
Prior PIC decisions on the scope of s 7.32(3) established that what constitutes “best endeavours” depends on the context of the claim.
The decision in Kaur, however, is a reminder that PIC proceedings will be dismissed where the Claimant makes no attempt to resolve the whole of the claim – or a critical issue such as the entitlement to NEL – before lodging their damages dispute application.
If you have a query relating to any of the information in this case note, or would like to discuss a similar matter of your own, please don’t hesitate to get in touch with CTP Insurance Principal, Peter Hunt, today.
