CTP Insurance, Insurance

The ambit of a PIC Member’s discretion – AAI Limited (trading as AAMI Limited) v Chan [2024] NSWSC 329

11 April, 2024

Key Principles

  • It is open for a PIC Member or Assessor to prefer one body of evidence over another.
  • The onus of proving a failure, by a Claimant, to mitigate their losses, under section 136 of MACA or section 4.15 of MAIA, lies with the Insurer. Discharging this onus invokes a number of considerations including the requirements needed to be undertaken by a Claimant in order to be able to actually pursue alternative employment.


In AAI Limited (trading as AAMI Limited) v Chan [2024] NSWSC 329, the matter before the Supreme Court was the Insurer’s application for judicial review of a PIC Member’s award for damages in the amount of $1,595,432.67.

The Claimant was injured in a motor vehicle accident on 14 December 2014. Initially, following the accident, the Claimant only complained of symptoms to his cervical spine. In late 2017, the Claimant began to report symptoms in his right shoulder.

In May 2019, the Claimant was assessed by a PIC Medical Assessor below the threshold (5%). The PIC Medical Assessor opined the Claimant only sustained a soft tissue injury to his cervical spine arising from the accident and did not accept the Claimant sustained any injury to his right shoulder. In September 2019, a Review Panel affirmed the findings of the original PIC Medical Assessor.

In 2022, a PIC Member assessed the Claimant’s damages and awarded a sum of $1,595,432.67. In coming to this conclusion, the PIC Member accepted that the Claimant sustained an injury to his right shoulder arising from the accident.

In relation to past economic loss, the PIC Member formed the view the Claimant had failed to mitigate his losses by not engaging in alternative employment as a GP which, by the Claimant’s own admission, he was qualified to and capable of performing. As a result, the PIC Member discounted the Claimant’s damages for past economic loss by one third to account for the failure to mitigate his losses.

In relation to future economic loss, the PIC Member confined his calculation to be for three years only, which, based on the available evidence, was the time it would take for the Claimant to re-train as a GP. In adopting this approach, the Member accepted, after three years, the Claimant would be able to work as a GP and earn an income greater than the maximum amount awardable for loss of earnings under s 125 of the Motor Accident Compensation Act 1999 (MACA).

The Insurer sought judicial review of the PIC Member’s decision on the following grounds:

  1. The Member impermissibly rejected the uncontested evidence of the Insurer’s liability expert who opined the mechanism of the accident would not have caused any injuries at all to the Claimant.
  2. The Member failed to find, make adequate findings, apply the evidence and consider the submissions of the Insurer relating to the Claimant’s credibility.
  3. The award granted was manifestly excessive.
  4. The Member made errors concerning the Claimant’s obligation to mitigate his losses and impermissibly relied on a report by an expert Occupational Therapist to inform him of the requirements needed for the Claimant to re-train as a GP; and
  5. The Member improperly preferred the evidence of the Claimant’s treating right shoulder surgeon over other medical and expert evidence.

Supreme Court reasons

Associate Justice Harrison rejected all of the Insurer’s grounds for review.

Ground one

The PIC Member, in his Certificate, stated that “he did not place significant weight” on the report of the Insurer’s liability expert because his findings are contradicted by multiple doctors, including the PIC Medical Assessor who conceded the Claimant sustained a soft tissue injury to his cervical spine due to the accident.

Associate Justice Harrison confirmed that preferring one body of evidence does not mean that there is a failure to give other evidence any weight. Her Honour highlighted the PIC Member did not state, anywhere in his reasons, that he gives the evidence of the Insurer’s liability expert no weight at all.

Her Honour concluded the Member’s decision was one that was open to him to make based on the evidence and was not manifestly unreasonable.

Ground two

In his determination, the PIC Member refers to the inconsistences in the Claimant’s own evidence and the Insurer’s submissions relating to inaccuracies in the evidence.

Her Honour accepted that whilst the Member did not make any specific findings on credit, he exercised his discretion by accepting some of the Claimant’s evidence and rejecting some of it.

Ground three

The Member, in his award, acknowledged the Claimant had done little to mitigate his losses. Based on that, the Member considered a buffer for future loss of earning capacity based on the time that it would take for the Claimant to re-train as a GP.

Her Honour accepted the Member gave adequate weight to the evidence concerning the Claimant’s ability to work after his surgery.  Further, the amount awarded to the Claimant by the Member was substantially less than the amount claim.

Ground four

Her Honour accepted the Member had properly considered the issue of mitigation under section 136 of MACA by reducing the amount awarded to the Claimant to account for the failure to mitigate his losses and capping his future economic loss to three years. The Member’s task was to assess the Claimant’s loss of capacity to earn and not actual lost income.

Her Honour highlighted the onus was on the Insurer to prove the failure by the Claimant to mitigate his losses. Given the Insurer did not provide any evidence as to what retraining as a GP would entail, and simply relied on the Claimant’s own account of the type of work he could complete, the Member did not err in his reasoning and approach of relying on the evidence of the expert Occupational Therapist.

Ground five

Her Honour concluded the Member was entitled to prefer the opinion of the Claimant’s treating surgeon over those of the four MAS doctors. This is because the Member had engaged in a detailed evaluation of the competing evidence and provided a clear path of reasoning to justify his approach.

Associate Justice Harrison affirmed the original decision of the PIC Member and ordered the Insurer to pay the Claimant’s costs.

Why this case is important

The decision in AAI Limited v Chan confirms that an Assessor has the discretion of preferring one piece of evidence over another and to decide on the weight to be accorded for each piece of evidence. The Assessor is not required to provide comprehensive reasoning for each of his preferences.

Furthermore, this case highlights that the onus of proving that a Claimant failed to mitigate their losses, under section 136 of MACA, lies with the Insurer. Discharging this onus includes consideration, amongst other things, of whether the Claimant has experience in an alternative employment, the length of time that has passed since that experience and any requirements needed to be completed by the Claimant in order to realistically pursue that alternative employment. It is not sufficient for an Insurer to simply rely on a Claimant’s own admission that they are qualified or able to pursue an alternative vocation.

Importantly, whilst the decision in Chan examined the scope of a Member’s discretion and the relevant considerations involved in proving a failure, by a Claimant, to mitigate their losses under section 136 of MACA, the principles apply equally to claims under the Motor Accident Injuries Act 2017 (MAIA). In relation to the mitigation of losses, the equivalent provision in MAIA is found under section 4.15 and is near identical in wording.


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 Associate Raissa Galang, or CTP Insurance Principal, Peter Hunt.

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