Review Panel finds Rotator Cuff Tear Sustained During Treatment is a Non-Threshold Injury

In Brief

• At Common Law, injury sustained during the application of reasonable and necessary treatment may have been caused by the motor accident unless the application of the treatment is grossly negligent.
• A rotator cuff tear sustained during treatment for a frozen shoulder was, therefore, found to be a non-threshold injury.
• The Court of Appeal has previously doubted, however, whether consequential surgery can transform a threshold injury into a non-threshold injury – see Mandoukos v Allianz Australia Insurance Limited [2024] NSWCA 71.

Facts

The PIC published its decision in Gibbin v AAI Ltd t/as GIO [2025] NSWPICMP 523 on 1 August 2025.

The Claimant was injured in a motor accident on 21 March 2019 when the vehicle she was driving was struck from behind at 80 kph.

The Insured denied liability for ongoing statutory benefits (and, effectively, for common law damages) on the grounds that the only injuries sustained by the Claimant were threshold injuries.

The threshold injury dispute proceeded to the Commission for assessment. A Medical Assessor subsequently found that the accident caused soft tissue injuries to the cervical spine and left shoulder, which were both threshold injuries.

The Medical Assessor noted a left rotator cuff tear, revealed by an MRI in November 2020, but concluded that the tear was age-related and not caused by the motor accident.

The Claimant successfully applied for referral to the Review Panel.

Relevant Definitions

The Review Panel determined that the motor accident caused a non-threshold injury to the Claimant’s left shoulder for the following reasons:

• Whilst there was no history of any direct impact to the Claimant’s left shoulder, she was holding the steering wheel when the rear-end impact occurred.
• The forces involved in the accident were capable, from a medical perspective, of causing a left shoulder injury.
• The Claimant made complaints of left shoulder pain to her GP seven days post-accident.
• The Claimant subsequently developed a frozen left shoulder.
• On the balance of probabilities, the accident caused an injury to the Claimant’s left shoulder which developed into a frozen shoulder.
• The Claimant underwent manipulation of her left shoulder under anaesthetic on 15 November 2019.
• A subsequent MRI scan on 26 November 2020 revealed a full thickness left rotator cuff tear.
• The manipulation under anaesthetic procedure was a reasonable and necessary treatment measure to address the Claimant’s frozen left shoulder.
• A torn rotator cuff is a known risk associated with manipulation under anaesthetic.
• The High Court held in Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; (1985) 156 CLR 522 that the original tortfeasor remains liable for injury caused by any subsequent treatment unless the conduct of the subsequent treatment provider can be categorised as grossly negligent.
• It followed that the accident caused a frozen left shoulder, necessitating manipulation under anaesthetic, which caused a rotator cuff tear which is a non-threshold injury.

Why This Case is Important 

The Review Panel in Gibbin applied the common law principle that an adverse treatment outcome, even if the result of negligence, is a foreseeable consequence of the original tortfeasor’s negligence in causing the original accident. Only gross negligence breaks the causal chain between the original accident and the adverse treatment outcome.

The Review Panel, therefore, concluded that the motor accident caused the left rotator cuff tear which resulted from the manipulation under anaesthetic designed to alleviate the Claimant’s frozen shoulder. There was no suggestion that the rotator cuff tear was the result of gross negligence. It was a foreseeable risk of the manipulation under anaesthetic.

The Review Panel appears to have overlooked, however, the doubts expressed by the Court of Appeal in Mandoukos v Allianz, at [99], re whether consequential surgery can transform a threshold injury into a non-threshold injury. Our full Case Note on Mandoukos can be found here.

If you would like to discuss this case note, please don’t hesitate to get in touch with CTP Insurance Principal Peter Hunt today.

Additional McCabes Resources

• MC PIC Decision of the Week
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• The Proper Lookout Podcast
• MC Ready Reckoner