Originally published in the Law Institute Journal

The High Court's examination of "serious injury" in TAC v Katanas will guide future decisions.

Snapshot

• In the recent decision of TAC v Katanas, the High Court considered the application of s93(17) of the Transport Accident Act, otherwise known as the narrative test of serious injury .
• The Court considered how psychological injuries are to be assessed in meeting the threshold of a severe mental or behavioural disturbance or disorder.
• In assessing whether an injury is serious , the Court held that it is necessary to consider all the relevant factors of a case and compare those circumstances to a range or spectrum of comparable cases.

In Transport Accident Commission v Katanas1 the High Court has examined the question of serious injury in its first decision on the Transport Accident Act 1986 (Vic) (TAA) since its introduction more than 30 years ago.

The judgment was handed down on 17 August 2017 and the decision will guide future serious injury decisions regarding psychological or behavioural injury for both the Transport Accident and Workcover schemes.

Legislative background

To obtain damages at common law for injuries suffered in a transport accident, a person must have sustained a serious injury in accordance with s93 of the TAA. If the injury is not assessed as resulting in a 30 per cent whole person impairment under the American Medical Association Guides to the Evaluation of Permanent Impairment, 4th edn (AMA 4), the plaintiff must satisfy a narrative test. If the Transport Accident Commission (TAC) does not agree that the claimant has satisfied the test, an application can be made to the County Court for leave to sue.2

In Humphries v Poljak3, the leading case on the narrative test, Crockett and Southwell JJ held that when assessing whether an injury is serious , it is necessary to ask:

. . . can the injury, when judged by comparison with other cases in the range of possible impairments or losses, be fairly described at least as'very considerable' and certainly more than'significant' or'marked'? 4

There are four grounds on which a plaintiff can seek to establish that they have suffered a serious injury under the narrative test. These are listed in s93(17) of the TAA as:

• serious long-term impairment or loss of a body function
• permanent serious disfigurement
• severe long-term mental or behavioural disturbance or disorder
• loss of a foetus.

Similar provisions appear at s327 of the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) with further restrictions in relation to claiming economic loss.

The application by Mrs Katanas was under s93(17)(c) of the TAA for a severe long-term mental or behavioural disturbance or disorder.

In Mobilio v Balliotis5 the Court of Appeal indicated that the test for serious injury in respect of a psychiatric injury was intended to be a stronger test, as the requirement was for a severe psychiatric condition, which was more than serious .6

Background facts

Maria Katanas was born in Greece in 1945 and came to Australia in 1962. She initially worked as a sewing machinist and then obtained her VCE in 1998. She completed a course so she could operate a taxi licence in 2004. She obtained an Arts degree in 2009.

Mrs Katanas had a number of health issues but no history of mental or behavioural disorders. She had been involved in previous car accidents in 1980 and 2001 but suffered no significant problems.

The accident

At 7pm on 10 July 2010, at the intersection of Princes Highway and Springvale Road, Mulgrave, Mrs Katanas' car was struck on the driver's side by another car. She was trapped in the car.

She was conveyed to the Alfred hospital. Her physical injuries included:

• left rib fractures
• seatbelt bruising
• laceration to left knee
• damage to teeth
• pain in neck, chest and abdomen.

She was discharged four days later.

Psychological injuries

Mrs Katanas received psychological assistance from approximately four months after the accident. The problems that she was found to have were variously identified as:

• post-traumatic stress disorder including nightmares and flashbacks
• extreme anxiety with panic attacks and fear of driving
• severe depression
• disturbed sleep
• emotional problems including unresolved grief and depression
• loss of self-confidence and self-esteem
• difficulty with concentration and socialising.

Treatment

Mrs Katanas seemed to resist any psychological treatment initially and resisted being in the hands of a psychiatrist. She eventually received anti-depressant medication from her general practitioner and psychiatrists and had other psychological assistance.

Mrs Katanas attended Monash Medical Centre Emergency Department in a distressed state in February 2014. Otherwise she had no hospital treatment.

She was still receiving treatment and anti-depressant medication from a psychiatrist at the time of the initial hearing in 2015 when her application commenced in the County Court before O'Neill J.

Effects of psychological injury

The effects of the psychological injury, accepted by O'Neill J, were that Mrs Katanas had flashbacks and nightmares, a fear of driving, loss of confidence, stress and anxiety and an inability to concentrate. He accepted these symptoms prevented her studying as she had planned and from looking after her grandchildren as she did before. She was also found to be more restricted in her social life.7

However, O'Neill J had reservations about Mrs Katanas' credibility which caused him to doubt the extent of the impact of the symptoms when assessing the consequences for her.8

Two part test

Many previous decisions of the Victorian Court of Appeal had proposed that an applicant had to pass a two part test. The High Court confirmed this two part process as:

• an assessment of whether the injury and its consequences are subjectively for the applicant severe; and
• a determination of whether the injury as assessed is objectively severe when compared with the range or spectrum of comparable cases.9

It was, however, in the second part of the test that the area of controversy arose.

Spectrum of cases

When comparing the application of Mrs Katanas with other cases O'Neill J said:

. . . Consideration must be given to the vast array of mental disorders which may be encountered following a transport accident. At one end of the spectrum is mild anxiety as a result of trauma, easily overcome without medical intervention. At the other end of the spectrum are those disorders which provoke the most extreme symptoms and consequences, including psychoses, admission to psychiatric hospitals as an inpatient, delusional beliefs and thoughts, suicidal ideation and suicide attempts. Such conditions require extensive treatment and medication. It follows that for a mental disorder to be described as being'severe', it is at the upper echelon of those disorders in the possible range. 10

Appeal to VSCA

The decision rejecting the claim and the apparent reliance on the Spectrum of disorders and treatment resulted in an appeal to the Victorian Supreme Court of Appeal.

The appeal was on the basis that due to the statement of O'Neill J about the scale of mental disorders, it could only mean that for a mental disorder to be severe it must have the most extreme symptoms and consequences, requiring extensive treatment and medication .11

The majority upheld the appeal stating:

We do not doubt that the extent of treatment made necessary by a psychiatric disorder may cast light on whether the disorder should be accounted as severe. But in our view the spectrum which the judge described was only one amongst a number of ways in which the question of severity might be approached, each of them being incomplete in itself . . . In our opinion, the correct thing to do, in each case, is to first identify and next bring to account all relevant circumstances personal to the claimant; and then to apply the statutory test, making a value judgment as described by Crockett and Southwell JJ in the passage cited at [9] above. In making that value judgment, a judge must give to each identified relevant circumstance the weight which appears to be appropriate. He or she will be assisted, of course, by personal experience of cases which have fallen on one side of the line or the other. 12

The majority of the Court of Appeal found that under the proposed spectrum attending a lot of doctors would suggest the person had a severe mental disorder and, conversely, a little treatment would mean a person didn't have a serious injury . This, they indicated, was not a correct analysis.13

The dissenting Judge, Kaye JA, found that there was no obsession with treatment and that O'Neill J had detailed many other aspects which related to his decision.14 He found that O'Neill J had not viewed the serious injury question through the prism of the spectrum of symptoms and treatment.15

The application was, therefore, remitted by the Victorian Supreme Court of Appeal back to the County Court for determination by a different judge.

High Court appeal

The TAC sought and obtained leave to appeal to the High Court as it raised a question of principle of general importance. This was the first time that the High Court had given leave relating to the serious injury test, previously refusing it in Fleming v Hutchison in 1991.16

The simple ground was that the Court of Appeal erred in holding that O'Neill J misdirected himself as to the application of the narrative test.

The question faced by the High Court was that the Victorian Supreme Court of Appeal had trampled upon the narrative test in relation to the comparison with a range of comparable cases. It was submitted that the Supreme Court of Appeal had introduced a new and unexplained concept of a line .17

The TAC contended that O'Neill J had adapted the test to the appropriate circumstances of Mrs Katanas. The TAC contended that, by saying the range formulated by O'Neill J was only of limited utility, the Court of Appeal had trampled upon the formulation of the evaluation of one case against the range of comparable cases.18

The High Court unanimously rejected this submission and found the Victorian Supreme Court of Appeal had correctly analysed the task facing judges in serious injury applications:

. . . the range, as so formulated, was incomplete because it had regard to only one criterion of the comparative severity of a mental disorder or disturbance: the extent of treatment made necessary by the disorder or disturbance. That precluded consideration of other relevant criteria of comparative severity . . . 19

The High Court did not accept the concept of trampling upon the narrative test either. They said:

Still less did the majority displace or'trample upon' the narrative test of seriousness or severity. Very much to the contrary, after observing that'the task which the judge had to undertake was that explained by Crockett and Southwell JJ in Humphries v Poljak', their Honours expressly noticed that the only error in the primary judge's application of the narrative test was in formulating the range by reference to only one of the several criteria relevant to the assessment . . . 20

The Court confirmed the process which will, no doubt, remain in place forever:

. . . in making an assessment of the severity of a mental disorder or disturbance by comparison to the range or spectrum of comparable cases, a judge must identify and bring to account all of the factors which emerge on the evidence as relevant to the assessment. There is nothing new in that proposition .21

In relation to the submission about a line, the High Court found that the use of the line phrase was just a phrase that had previously been used in Mobilo v Balliotis. The Court said:

The point of the observation was evidently to emphasise, in previously sanctioned language, the long-recognised reality that the application of the narrative test is in the end likely to turn'on the opinion of a judge familiar with a range of conditions within which the instant condition occurs' and thus upon the judge's conclusion as to the'side of the line' on which the case may fall .22

Conclusion

The High Court has provided a clear confirmation that a serious injury application needs to be assessed:

• first, as serious/severe for the particular applicant; and
• second, as serious/severe in the instant case as compared to the range of similar cases.

Importantly, all consequences are to be assessed and evaluated without a particular scale needing to be used.

Treatment is important, but as the Court of Appeal said, so is severity of symptoms, frequency of consequences and inhibitions upon daily activities or work or education. It is then vital to remember that each area is important but no one of them by itself would answer the critical question .23

Co-author: Giorgina McCormack.

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1. [2017] HCA 32.
2. Note 2 above, s93(4).
3. [1992] 2 VR 129.
4. Note 4 above, at [140].
5. [1998] 3 VR 833.
6. Note 5 above, per Brooking JA (Winneke P, Ormiston JA, Phillips JA and Charles JA agreeing at 834-835, 854, 858, 860?861).
7. Katanas v Transport Accident Commission [2015] VCC 1156 [83]-[84].
8. Note 7 above, at [77]-[78].
9. Note 1 above, at [6].
10. Note 7 above, at [82].
11. Katanas v Transport Accident Commission (2016) 76 MVR 161, at [12].
12. Note 11 above, at [19].
13. Note 11 above, at [20].
14. Note 11 above, at [89].
15. Note 11 above, at [90].
16. (1991) 66 ALJR 211.
17. TAC v Katanas [2016] HCATrans 286 at lines 11-14, 96-104, 147-170.
18. Note 1 above, at [1].
19. Note 1 above, at [21].
20. Note 1 above, at [24].
21. Note 1 above, at [25].
22. Note 1 above, at [27].
23. Note 1 above, citing Katanas (2016) 76 MVR 161 at 167 [19].