Judgment date: 27 March 2019
Citation: Cahill v Allianz Australia Insurance Ltd  NSWSC 328
Jurisdiction: Supreme Court of New South Wales (Common Law)*
The Insurer issued a Section 81(1) Notice admitting breach of duty of care but raising a defence of contributory negligence to the extent of 5% due to the Claimant's unsafe driving.
Settlement negotiations took place between the parties over a period of almost 2 years. On all occasions, the offers exchanged made no reference to a reduction for contributory negligence.
The Claimant referred the dispute to CARS for General Assessment. The relevant application acknowledged the allegation of contributory negligence. The Insurer's Reply encompassed submissions which confirmed its position on liability.
The Claims Assessor directed the parties to make written submissions. Those submissions did not address the issue of contributory negligence.
During the Assessment Conference no questioning of the Claimant was directed to the issue. A statement from the driver at fault was before the Assessor. During closing submissions the Claims Assessor asked the Insurer's counsel what he wished to say about contributory negligence, to which the response was that reliance was placed on the driver's statement and there was nothing further to say "other than that which has been put in writing".
The Claims Assessor issued a Certificate supported by Reasons for Decision. In those reasons, under a heading of "Contributory Negligence" he stated:
"There is no evidence before me that the Claimant contributed to the cause of the motor vehicle accident….I find that the Claimant is entitled to a full award of damages without any deduction for contributory negligence".The Claimant subsequently informed the Insurer that he accepted the assessment of damages specified in the Certificate, pursuant to s 95(2) of the Act. The Insurer responded by confirming that it did not accept the assessment as liability was not wholly admitted.
The Claimant filed a summons in the Supreme Court of NSW to have the assessment affirmed and seeking an order that the Insurer pay the Claimant the amount of damages specified in the Certificate.
The Insurer relied upon the fact that the s81 (1) Notice was not altered, nor was the defence abandoned at any time. Further, the Insurer submitted that the Claims Assessor calculated the Claimant's costs on the basis of "liability not wholly admitted" and the Claimant had not objected to the assessment of costs awarded on this basis (noting that if liability was wholly admitted, then a lesser amount would have been assessed for costs).
His Honour found that the Insurer at no time prior to the Assessment Conference or during the Assessment Conference had abandoned the allegation of 5% contributory negligence. He observed that the Claimant was met with three immediate difficulties in proving so: