Australia: Court Supports CARS Assessor's Approach to Apportioning Damages Between Insurers

Zurich Australian Insurance Limited v Elizabeth Pellegrino; Elizabeth Pellegrino
Last Updated: 8 October 2010
Article by Gerry Tzortzatos

Judgment date: 30 September 2010

Zurich Australian Insurance Limited v Elizabeth Pellegrino; Elizabeth Pellegrino v NRMA Insurance Australia Ltd [2010] NSWSC 1114

Supreme Court of New South Wales 1

In Brief

  • Where a claimant has suffered injuries in multiple accidents and there is significant overlap between the losses caused by the various accidents, the damages should be calculated on an overall basis and then apportioned between the various tortfeasors and/or pre-existing conditions.
  • The opportunities for successfully challenging a CARS Assessment on the basis of jurisdictional error remain very limited.


The claimant was injured in three motor accidents occurring in 1987, 2002 and 2005. The claimant sought damages pursuant to the Motor Accidents Compensation Act 1999 (the Act) in relation to the 2002 and 2005 accidents, such claims being the subject of simultaneous assessment by the same claims assessor. The Assessor assessed damages as a whole then apportioned the damages between the pre-existing conditions, the first insurer and the second insurer.

The claimant suffered neck and back injuries following the 1987 accident which resulted in ongoing losses up to the subsequent accidents. The Assessor deducted 15% from the total damages to account for the loss incurred in the 1987 accident. The Assessor found that the 2002 accident aggravated the claimant's pre-existing conditions but the 2005 accident took her injuries to 'a new level of intensity'. The Assessor found the claimant also suffered a psychological injury in the 2005 accident and was unable to return to her previous work duties. The Assessor apportioned the remaining damages 15% to the first insurer and 85% to the second insurer. The Assessor considered this approach appropriate due to his finding that there was significant overlap between the various accidents and the claimant's losses.

The first insurer filed a summons in the Supreme Court submitting that the Assessor had erred in his approach to assessing damages, claiming that he should have made independent assessments of damages in each claim. The second insurer did not agree that there was any error in the assessment. The claimant filed a summons seeking that the certificate of assessment in relation to the second insurer be set aside only if the certificate of assessment against the first insurer was set aside.

Supreme Court

In scrutinising the Assessor's approach the Court considered a number of cases in which damages had to be apportioned between consecutive tortfeasors 2. The Court also referred to Luntz, Assessment of Damages for Personal Injury and Death 3 wherein it is stated

"If both tortfeasors are before the Court, it is probably best to assess the total damages as though there was only a single tort and then to apportion the loss to the respective tortfeasors according to one or the other of these methods."

At paragraph 43 the Court stated:

"From these cases, it can be seen that where a further injury results from a subsequent accident which would have occurred had the plaintiff been in normal health but the damage is greater because of the aggravation of the earlier injury the damage resulting from the injury should be treated as the defendant's negligence. The overall damages can then be calculated and apportioned between the tortfeasors."

The Court found there was no error of law in the Assessor's determination and dismissed the summonses.


This decision confirms an approach to assessment of damages that may be taken in complicated cases involving consecutive accidents or pre-existing conditions when there is a significant overlap between the injuries and resulting losses. Where it is possible to disentangle the losses arising from the consecutive accidents or pre-existing conditions, independent assessments should be made of each accident. Insurers should be aware that they bear the evidential onus of disentangling the pre-existing injuries from those arising in their accident.

This decision also serves as a further example of the difficulty insurers face in establishing jurisdictional error and challenging the outcome of CARS Assessments.

1. Harrison AsJ

2. State Government Insurance Commission v Oakley (1990) Aust Torts Reports 81-003; Barbaro v Gambacorta 6 MVR 99; DNM Mining Pty Ltd v Barwick [2004] NSWCA 137; Government Insurance Office of NSW v Aboushadi [1999] NSWCA 396; Insurance Australia Limited trading as NRMA Insurance v Helou [2008] NSWCA 240

3. 4th ed, paragraphs [2.6.8] and [2.6.9]

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