This is an important decision which provides some guidance about when people injured in motor accidents in NSW may have access to extra damages for treatment and care but leaves many questions unanswered. The Court of Appeal has urged Parliament to consider legislative amendments.

Summary and Implications

• The Court identified that there are two distinct categories of accident, ‘motor vehicle accidents’ and ‘public transport accidents’
• The assessment of damages for ‘public transport accidents’ are to be assessed under Chapter 5 of the Motor Accidents Compensation Act 1999 (NSW)(‘MACA’)
• An accident involving the State Transit Authority (STA) bus is to be categorised as a ‘public transport accident’
• Some important questions left unanswered.

Facts of the case

On 21 October 2019, Ching Yu Chang, who was four-year-old child, was a passenger on a bicycle being ridden by his mother on Liverpool St, Sydney, when it was hit by a State Transit Authority bus. There was no dispute between the parties regarding fault, and liability was admitted.

The plaintiff suffered severe injury to his right foot which was later amputated.

A dispute arose between the parties as to whether damages ought to be assessed under Part 4 of the Motor Accident’s Injuries Act 2017 (NSW) (‘MAIA’) or Chapter 5 of MACA, noting that an assessment of damages under MACA was likely to be more valuable than the limited damages he might receive under MAIA.

Legislative Background

Whilst the Courts noted that the community would expect a simple answer to the question, it involved consideration of seven of pieces of legislation; most relevantly the Transport Accidents Compensation Act 1987 (NSW) (‘1987 Act’), Transport Administration Act 1988 (NSW) (‘1988 TAA Act’), Motor Accidents Act 1988 (NSW) (‘1988 MAA Act’), MACA and MAIA.

Because of the complexity, and (we would respectfully argue) the uncertainty remaining after this decision, it is unsurprising that Chief Justice Bell, and Acting Justice of Appeal Griffiths, stressed the need for Parliament to address and simplify the situation.

District Court Proceedings

The matter was heard in the first instance by Judge Russell SC in the District Court, who approved the determination of the legal issue regarding the relevant to scheme as a separate issue.

On this issue, His Honour held that the Motor Accident Compensation Act 1999 continue to operate with respect to public transport accidents and that an accident involving an STA bus was a ‘public transport accident’.

The defendant was granted leave to appeal this decision.

Court of Appeal Proceedings

Basten AJA, for the Court, noted that the 1988 MAA Act created a two-category approach, separating motor vehicle accidents and transport accidents. Specifically, s69 of the 1988 MAA Act creates the following categories:

(1)  This Part applies to and in respect of an award of damages which relates to the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle.

(2)  This Part also applies to and in respect of an award of damages which relates to the death of or bodily injury to a person caused by or arising out of a transport accident (within the meaning, immediately before the date of commencement of Part 2, of the Transport Accidents Compensation Act 1987), not being an award of damages to which subsection (1) applies.

As the 1988 MAA Act and MACA both sought to encompass all damages arising out of transport accidents, there had not been a need to distinguish between the categories.

However, His Honour noted that s121 of the 1988 TAA Act provides that Chapter 5 of MACA applies in respect of public transport accidents and applies “even though the public transport accident occurred after the commencement of the Motor Accident Injuries Act 2017”. As such, His Honour found that whilst MAIA applied to all “motor vehicle accidents” after its commencement, damages arising out of “public transport accidents” were still governed by Chapter 5 of MACA. Thus, there is a need to distinguishing between the two categories of accident to work out which scheme applies to quantification of damages.

This then raised the question of whether the phrase “not being an award of damages to which subsection (1) applies” precluded any accidents involving motor vehicles from being a public transport accident?

In this regard, the defendant submitted that a bus was a motor vehicle as prescribed by s69(1) of the 1988 MAA Act, and therefore, excluded from the operation of s69(2), meaning that an accident involving a bus falls under the general motor vehicle accident umbrella rather than the ancillary public transport accident category.

In his judgment, Basten AJA referenced s4 of the 1987 TAC Act and found that paragraphs (a)-(c) dealt with motor vehicles and would therefore be covered by s69(1) of the 1988 MAA Act as motor vehicle accidents, whereas paragraphs (d) and (e) referenced other forms of transport and were therefore public transport accidents for the purpose of s69(2).

His Honour noted that s4(1)(d) included any form of transportation or conveyance operated by the Urban Transit Authority (the predecessor of the STA) or State Rail Authority. It was found that the reference to Urban Transport Authority at paragraph (d) would have served no purpose if it was intended for state-operated buses to fall under the operation of paragraph (a), as the Urban Transport Authority did not operate any transport that was not a motor vehicle.

Therefore, Basten AJA found that a bus, being a motor vehicle, was not automatically covered by s69(1) of the 1988 MAA Act and could potentially be a public transport accident if it was accepted as falling under s4(1)(d) or 4(1)(e) of the 1987 TAC Act.

The Court’s attention then turned to determining whether an accident involving an STA bus was a general motor vehicle for the purposes of s4(1)(a) of the 1987 Act, or a form of transport operated by the Urban Transit Authority or the State Rail Authority in accordance with s4(1)(d).

Whilst it was noted that buses are generally consistent with a motor vehicle for the purposes of paragraph (a), state operated buses were more specifically defined under paragraph (d), which suggested that they ought not to be included under paragraph (a).

As such, the Court found that accidents caused by the fault of STA buses fell under s4(1)(a) and are public transport accidents for the purpose of s121 of the TAA Act 1988, and therefore an award for damages arising out of same is governed by Chapter 5 of MACA.

Therefore, the defendant’s appeal was dismissed.

Outstanding Issues

Basten AJA and Griffiths AJA noted that it was possible that privately operated buses could be involved in public transport accidents. This issue is particularly relevant noting that the STA ceased trading after 2 April 2022 and the operation of the State’s buses has been contracted out. Griffiths AJA observed that resolution by Court processes of that issue would be costly and demanding in terms of time and resources, suggesting in his Honour’s view the answer wasn’t straight forward.

The defendant contended that an anomaly would arise where a plaintiff would obtain benefits of the statutory benefits scheme under MAIA and also have damages assessed under MACA, with no provision for repayment of the value of the statutory benefits out of the award of damages. Basten AJA did not think that provided reason to construe the provisions different. His Honour said the submission assumed that s3.40 of the MAIA would not apply if damages were assessed under Chapter 5 of MACA, but that issue had not been addressed in submissions and was not a matter that needed to be determined in proceedings. With respect, section 3.40 could only be a partial answer to the problem identified, as even if it be applicable (which is not clear), it does not relate to recovery of statutory benefits for treatment and care, only to weekly payments.

It is also not clear from the judgment whether s4.4 of the MAIA needs to be satisfied by those contending they suffered a public transport accident, before getting to the scheme applicable to the quantification of damages.

Conclusion

The implications to the scheme are potentially very significant, particularly if it be the case that it applies to the quantification of damages in claims arising from the use of buses operated by private bus companies under contract with the Government. The potential for access to statutory benefits and lump sum damages simultaneously has not been addressed by this judgment, and nor is it clear whether the need to establish a non-threshold injury is a precondition to recovery of any damages in so called public transport accidents involving buses.

The decision may provide some relief to insurers in death claims arising in ‘public transport accidents’, because it will reintroduce the caps and restrictions from ss141B and s142 of MACA into the quantification of those damages.

Finally, both Bell CJ and Griffiths AJA noted the complexities of the decision and raised the need for legislative simplification, so stay tuned for updates.

Further information / assistance regarding the issues raised in this article is available from the authors, Judith Waldock, Partner and Ethan Spiers, Lawyer or your usual contact at Moray & Agnew.