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SUPREME COURT OF QUEENSLAND
Zavodny v Couper & QBE  QSC 238
ALAN FRANK ZAVODNY
KEVIN RAYMOND COUPER
QBE INSURANCE (AUSTRALIA) LIMITED
(CAN 003 191 035)
SC 523 of 2016
Supreme Court at Cairns
16 October 2018
12 October 2018
PROCEDURE – DISCOVERY AND INTERROGATORIES – LEGAL PROFESSIONAL PRIVILEGE – disclosure of documents pursuant to Motor Accident Insurance Act 1994 – whether surveillance reports obtained by insurer should be provided to the claimant – whether surveillance reports are disclosable pursuant to s 47(1) of Act – whether surveillance reports fall within s 48(2) of Act – whether the surveillance reports come within the description “investigative reports, medical reports and reports relevant to the claimant’s rehabilitation”.
TORTS – STATUTES, REGULATIONS, ETC - APPLICABILITY AND EFFECT IN ACTIONS FOR NEGLIGENCE – RELATING TO VEHICLES AND TRAFFIC – GENERALLY – where the plaintiff has a personal injuries case arising from a traffic collision – disclosure of documents pursuant to Motor Accident Insurance Act 1994 – whether surveillance reports obtained by the insurer are disclosable pursuant to s 47(1) of Act – whether surveillance reports fall within s 48(2) of Act – whether the surveillance reports come within the description “investigative reports, medical reports and reports relevant to the claimant’s rehabilitation”.
Motor Accident Insurance Act 1994 (Qld) s 48(2)
Personal Injuries Proceedings Act 2002 (Qld)
Uniform Civil Procedure Rules 1999 (Qld) r 223, r 393
Samways v Workcover Queensland & Ors (No 2)  QSC 273, cited.
State of Queensland v Allen  2 Qd R 148, cited.
Turpin v Allianz Australia Insurance Ltd  1 Qd R 692, cited
AR Philp QC for the applicant
R Morton for the respondents
Roati Legal for the applicant
Barry Nilsson for the respondents
- The applicant is plaintiff in a personal injuries case arising from a traffic collision. An issue at the soon to be listed trial will be whether he has recovered from his injuries.
- The respondents served the applicant with an updated list of documents dated 22 February 2018. That list introduced a number of documents not present in the respondents’ previously served list dated 24 May 2017. Of present interest are the privileged documents described thus in the list:
“Part 2 – Documents for which privilege is claimed
Description of document
Person who made document
Instructions to surveillance operatives
- The applicant seeks an order pursuant to r 223 Uniform Civil Procedure Rules 1999 (Qld) (“UCPR”) for the production for inspection of “all reports, photographs and video footage including the documents contained in or associated with the surveillance reports listed in part 2” of the above-mentioned list. There is no separate listing in the list of photographs or video footage. If such footage was generated and is relevant then, given it has not been listed separately, it would presumably come within the description of documents 9 and 10. As the application was argued, the order sought is in respect of the reports listed as documents 10 and 11 inclusive of any photographs and video footage which are part of those reports (“the surveillance reports”).
- The applicant does not in this application challenge the legitimacy of the privilege claimed over the surveillance reports. Rather he contends the effect of s 48(2) Motor Accident Insurance Act 1994 (Qld) is that they must be disclosed even though protected by legal professional privilege.
- The issue to be determined thus involves the interpretation of s 48(2), a task best commenced with consideration of its context within the Motor Accident Insurance Act (“MAIA”). The objects of MAIA relevantly include, at s 3:
“(e) to encourage the speedy resolution of personal injury claims resulting from motor vehicle accidents; and
- (f)to promote and encourage, as far as practicable, the rehabilitation of claimants who sustain personal injury because of motor vehicle accidents; …” (emphasis added)
- Part 4 of MAIA, is titled “Claims”. Division 4 therein, containing ss 45-49, is titled “Cooperation between claimant and insurer”. Section 45 deals with the duty of the claimant to co-operate with the insurer. Sections 45A to 46B deal with expert panels and reports. There then follows s 47, dealing with the insurer’s duty to co-operate. It relevantly provides:
“47 Duty of insurer to cooperate with claimant
- (1)The insurer must cooperate with a claimant and, in particular—
- (a)must provide the claimant with copies of reports and other documentary material in the insurer’s possession about the circumstances of the accident or the claimant’s medical condition or prospects of rehabilitation; and
- (b)must, at the claimant’s request, give the claimant information that is in the insurer’s possession, or can be found out from the insured person, about the circumstances of, or the reasons for, the accident. …” (emphasis added)
- In the context of a matter soon to be listed for trial, s 47(1)(a) may add little to a party’s duty of disclosure, in any event provided for by the UCPR. However, it will be recalled MAIA is concerned with encouraging the speedy resolution of claims. Section 47(1)(a) has the effect of requiring disclosure of the documents it refers to from the outset, potentially facilitating a resolution long before the insurer and claimant become opponents in a looming trial. Its temporal breadth is returned to later in these reasons.
- Section 48 of MAIA deals specifically with legal professional privilege and disclosure, providing the exception to privilege with which we are here concerned. It provides:
“48 Non-disclosure of certain material
- (1)A claimant or insurer is not obliged to disclose information or documentary material under this division if the information or documentary material is protected by legal professional privilege.
- (2)However, investigative reports, medical reports and reports relevant to the claimant’s rehabilitation must be disclosed even though protected by legal professional privilege but they may be disclosed with the omission of passages consisting only of statements of opinion.
- (3)If an insurer has reasonable grounds to suspect a claimant of fraud, the insurer may withhold from disclosure under this division information or documentary material (including reports that would, apart from this subsection, have to be disclosed under subsection (2)) to the extent the disclosure would alert the claimant to the discovery of the grounds of suspicion or could help in the furtherance of fraud. …” (emphasis added)
- The question arising in the present case is whether the surveillance reports come within s 48(2)’s description, “investigative reports, medical reports and reports relevant to the claimant’s rehabilitation”.
- The ordinary meaning of the words indicate they do. Surveillance reports are, prima facie, “investigative reports”, surveillance being a form of investigation.
- The parties referred at some length to State of Queensland v Allen, where consideration was given to the meaning of “investigative reports” in the Personal Injuries Proceedings Act 2002 (Qld) (“PIPA”). The Court of Appeal there concluded, inter alia, a record of a doctor’s answers to questions and two file notes by solicitors of information conveyed by a doctor to a solicitor were not investigative reports. Different reasons were given but the essential theme of the reasoning was that the mere recording of information stated by prospective witnesses is neither a report nor an investigative report. Documents of a quite different character are under consideration here.
- PIPA’s ss 27 and 30 have some similarity to MAIA’s ss 47 and 48 and each also contains differently worded document descriptors. In State of Queensland v Allen Fraser JA posited the lack of correspondence between the descriptors in, inter alia, ss 27 and 30 might be bridged by distinguishing between investigative reports as only going to liability and medical reports as going only to quantum. This found no support amongst the rest of the Court. White J considered there was no common thread. Her Honour observed:
“ The legislature has identified three kinds of report in respect of which privilege from disclosure may not be claimed – investigative, medical and rehabilitative. There is no common thread which illuminates the adjectives employed. A rehabilitative report might be expected to refer to the extent of the injury and prospects of recovery which will concern issues of quantum; investigative reports and medical reports can each concern liability and quantum. The loss assessor’s investigative report may include surveillance to detect exaggeration. That usually relates to quantum. The loss assessor may also measure distances and interview eye witnesses.
 Ordinarily the legal meaning of words in a statute will correspond with the grammatical meaning of those words. The Shorter Oxford English Dictionary relevantly defines “report” as follows:
“2 An account given or opinion expressed on some particular matter esp. after investigation or consideration; a more or less formal account of some matter; a formal statement of the results of an investigation carried out by a person or appointed body.”
The adjective “investigative” is relevantly defined in the Shorter Oxford English Dictationary as:
- Characterized by or inclined to investigation.”
And “Investigation” is defined as:
“1 The action or process of investigating; systematic examination; careful research.
2 An instance of this; a systematic inquiry; a careful study of a particular subject.” (emphasis added)
- The uncontroversial notion flowing from the definitions quoted by her Honour – that a report includes an account or opinion or formal statement of results provided after investigation – is relevant here. So too is the unremarkable notion that an investigation involves the process of investigation or of systematic inquiry or of careful research, for instance careful study of a particular subject. In the present case it will be recalled that the document preceding the surveillance reports in the list of privileged documents is described as “Instructions to surveillance operatives”. It is obvious those operatives were to operate as investigators just as it is obvious the surveillance reports were accounts or statements of the results of their investigation by surveillance. Generally speaking surveillance reports will be reports on a surveillance investigation and are therefore “investigative reports”.
- Further, the circumstances of the present case, in which the extent of the plaintiff’s recovery is in issue, compel the inference the surveillance was of the plaintiff and calculated at ascertaining whether he behaved as if rehabilitated or still suffering from injury. I therefore infer the surveillance reports here are not just “investigative reports” but also come within the ordinary meaning of “reports relevant to the claimant’s rehabilitation”.
- On the ordinary meaning of s 48(2) it therefore appears the surveillance reports come within two of three described exceptions to the protection of privilege. Such a conclusion rests comfortably with the Act’s objects, for sharing information, and thus getting more quickly to the truth about a claimant’s actual extent of rehabilitation, will likely promote a timelier resolution. Holding back on such information for the sake of some surprise cross-examination fuel at trial is at odds with the Act’s object of speedy resolution of claims.
- The legislature was not naive to the wisdom of preserving some pre-trial secrecy where fraud is afoot. Section 48(3) preserves the right to hold back on disclosure, including of documents referred to in s 48(2), if there are reasonable grounds to suspect fraud and the disclosure would further fraud or alert the claimant to suspicion of fraud. However, there is a difference in degree between information about reasonably suspected fraud and information which is of varying effect as to the true extent of a claimant’s rehabilitation. In cases of this kind surveillance reports may often generate information in the latter category, with the consequence they are disclosable pursuant to s 48(2) and not protected against disclosure by s 48(3). It is not to the point, as the respondents emphasise, that information in the latter category is likely information within the claimant’s knowledge already. The section’s language does not suggest that is relevant. Moreover, it is to be appreciated some claimants, who could be psychologically impaired, may be honest but unreliable assessors of their degree of recovery. They may be encouraged to a speedier resolution of their claim if made aware of the evidentiary perspective of their recovery from sources other than themselves.
- Such a view is consistent with the observations of Applegarth J in Samways v Workcover Queensland & Ors (No 2). His Honour was there dealing, inter alia, with the potential costs consequences of a default in compliance with the disclosure obligations in PIPA, specifically a failure to disclose a surveillance recording and surveillance reports. His Honour found the disclosure of the surveillance recording on the eve of trial had occurred far too late. As to the reports his Honour relevantly observed:
“The surveillance reports were relevant to assessing the plaintiff’s claim to have a shoulder injury that impaired him and was relevant to his claim for economic loss. They were relevant to his functional capacity. They were apt to help him to make a proper assessment of an offer by the second defendant since they revealed that the second defendant had grounds to conclude that the extent of his injury was grossly overstated.”
Care needs to be taken in drawing assistance from decisions on other Acts, however those observations support the view it is irrelevant to disclosure obligations that surveillance reports may reveal information already known to a claimant.
- The respondents do not presently lay claim to s 48(3). That is unsurprising for, if the surveillance reports in this case gave the grounds for suspicion and consequence contemplated by s 48(3), it is likely that, as s 48(3) appears to permit, they would not have been included in the list of documents. The only present relevance of s 48(3) is that its inclusion in s 48, as well as its specific reference to s 48(2), supports the above discussed interpretation of s 48(2).
- The respondents submit against the ordinary meaning of s 48(2) discussed above, arguing the meaning of those words is informed by s 47.
- In Turpin v Allianz Australia Insurance Ltd Mullins J explained:
“It is only if the relevant statements are covered by s 47(1) of the Act that it is necessary to consider s 48 of the Act”.
As much seems uncontroversial, for it appears the purpose of s 48, when considered in its context within Part 4, immediately following s 47, is to specify the extent to which s 47(1)’s mandatory effect abrogates legal professional privilege.
- However, building on the notion that the documents referred to in s 48 are documents which must be provided pursuant to s 47 the respondents go an unsustainable step further, seizing upon the categories of documents described in s 47(1)(a) to read down the meaning of the categories of documents described in s 48(2). For example, it is submitted that because s 47(1)(a) alludes to reports about the circumstances of the accident it must follow that the investigative reports referred to in s 48 are limited to investigative reports about the circumstances of the accident.
- Such a construct ignores the reality that the legislature chose to use different document descriptors in each section. That is unsurprising in that the sections are conceptually different. While there is implicitly some overlap in the sections’ temporal focus it is also tolerably clear the impliedly broad temporal reach of s 47 includes an early stage in the progress of a claim, when the need to assert legal professional privilege over reports procured by lawyers is unlikely to arise. That the legislature used different document descriptors in s 48 reflects that section’s specific concern with the right to exercise such privilege.
- Of course, the term “investigative reports” in s 48(2) may include investigative reports into the accident. Indeed, at an early stage there may not exist many other forms of investigative reports. But it is well enough known, for example, that as time progresses a sceptical insurer might commission an investigative report, such as a surveillance report, into a claimant to help ascertain the true state of the claimant’s medical condition or prospects of rehabilitation. The legislature’s choice of words in s 48 is apt to capture just such a development.
- That is not to suggest such surveillance reports are not also caught by the broadly worded document descriptors in s 47(1)(a). The respondents’ urged construct seemingly assumes s 47(1)(a)’s references to “reports and other documentary material” “about … the claimant’s medical condition or prospects of rehabilitation” could not include surveillance reports. Those references may tend to bring to mind medical and allied health reports but there is no basis to confine such broad language to such reports. Sources of potential evidence about medical condition or prospects of rehabilitation are hardly confined to medical or allied health professionals or expert witnesses. Indeed, as many such professionals often testify, an excellent source of such evidence is observing the patient. A surveillance report providing information suggesting recovery from a medical condition, or positive indicia of rehabilitation, comes within s 47(1)(a)’s description of a report or other documentary material about the claimant’s medical condition or prospects of rehabilitation. To read such words down as excluding surveillance reports would be at odds with their breadth and MAIA’s object of encouraging speedy resolution – an object ss 47 and 48 are obviously intended to promote through disclosure.
- In this case the surveillance reports come within s 48(2)’s exception to legal professional privilege and should be disclosed by copies of them being provided to the defendant, as s 47 requires. It is not presently to the point that another provision, of general application to litigation, namely r 393 UCPR, contemplates a process of later inspection of documents of a kind which may form part of the surveillance reports, such as photographs or recordings. If such material is part of the surveillance reports then copies must necessarily be provided pursuant to MAIA.
- The application only sought production for inspection rather than copies being provided but s 47 contemplates the latter. It is an inevitable consequence of the argument’s outcome that my order should be consistent with the section. If the parties reach some other arrangement by consensus that is a matter for them.
- It will be necessary to hear the parties as to further orders including costs and the trial listing.
- My orders are:
- Application granted.
- The respondents will provide to the applicant copies of the surveillance reports listed in the respondents’ list of documents dated 22 February 2018.
- I will hear the parties as to further orders.
- Published Case Name:
Zavodny v Couper & QBE
- Shortened Case Name:
Zavodny v Couper
 QSC 238
16 Oct 2018
|Event||Citation or File||Date||Notes|
|Primary Judgment|| QSC 238||16 Oct 2018||Application for the defendants to disclose copies of the surveillance reports listed in their list of documents granted: Henry J.|
|Primary Judgment|| QSC 259||09 Nov 2018||Costs order: Henry J.|