In Brief
- An allegation of false or misleading statement by the Claimant, in a material particular, as to the circumstances of the accident, will result in a mandatory exemption under s 92(1)(a) of the Motor Accidents Compensation Act 1999 and clause 8.11.6 of the MAA Claims Assessment Guidelines.
- A mandatory exemption under clause 8.11.6, on the grounds of false or misleading statement as to the circumstances of the accident, may be obtained notwithstanding a prior Section 81 Notice admitting fault with no allegation of contributory negligence.
Background
The Principal Claims Assessor has recently issued a Mandatory Exemption Certificate under s 92(1)(a) of the Motor Accidents Compensation Act 1999 and clause 8.11.6 of the MAA Claims Assessment Guidelines, based upon an allegation for false and misleading statement as to the circumstances of the accident.
Clause 8.11.6 provides that:
The insurer, in the case under consideration, alleged that the claimant had made a false and misleading statement as to the circumstances of the accident.
Whereas the claimant alleged that the insured struck the rear of her vehicle and pushed her vehicle into the rear of the vehicle ahead of her, there was evidence that the claimant hit the car in front of her before the impact caused by the insured.
Principal Claims Assessor's Decision
After taking issue with the insurer's interpretation of the evidence, the claimant argued that a mandatory exemption should not be granted because whereas clause 8.11.6 refers to "fraudulent claims", the insurer only made an allegation of "false or misleading" statement as to the circumstances of the accident.
The PCA, however, rejected the claimant's argument, reasoning as follows:
"`Fraud', in its legal sense is defined in the Macquarie dictionary as `advantage gained by unfair means, as by a false representation of fact made knowingly, or without belief in its truth, or recklessly, not knowing whether is true or false.' When I read that definition, combined with the four sections of the Act referred to above [ss 116 to 119] it is clear to me that the parliament does not mean to distinguish between false claims or fraudulent claims. A claim that is fraudulent or false is one in which the claimant has made a `statement knowing that it is false or misleading in a material particular'.
"The difficulty with the claimant's argument is that I cannot look beyond or behind the allegation that has been made. I cannot look at the merits of otherwise of what the insurer has done. I can really only look at the letter it has written. The insurer in this case has made an allegation that [the Claimant] has made a false or misleading claim. It is alleging she has made a statement about how the accident happened that is knowingly false or misleading. The insurer has not used the precise work but its allegation can be construed as alleging the claim is fraudulent."
On this basis, the PCA found that the insurer's letter fell within clause 8.11.6 and issued a mandatory exemption certificate.
Implications
Given the PCA's decision, it is apparent that an insurer can obtain a mandatory exemption under s 92(1)(a) by alleging that the claimant has made a false or misleading statement as to the circumstances of the accident.
It is clear that the aspect of the circumstances said to be false or misleading must have some relevance to fault, contributory negligence or causation. It can not be something trivial such as the colour of the vehicle.
However, provided the insurer makes an allegation that the claimant has made a statement "knowing that it is false or misleading in a material particular", the PCA is prepared to construe this as an allegation for fraud as to the circumstances of the accident for the purpose of clause 8.11.6.
Importantly, the PCA issued an exemption certificate under s 92(1)(a) even though the insurer had previously served a Section 81 Notice admitting fault and making no allegation of contributory negligence.
As such, clause 8.11.6 appears to represent a mechanism of obtaining an exemption from assessment by CARS notwithstanding admissions contained in a Section 81 Notice, provided there are valid grounds for alleging false and misleading statement by the claimant, in a material particular, as to the circumstances of the accident.
We recommend that this mechanism only be utilised after careful consideration of the facts of the case and whether an allegation of false or misleading statement is justified. Overuse in unwarranted circumstances is likely to result in clause 8.11.6 being amended or repealed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
