Mitrovic v Motor Accidents Authority of New South Wales [2012] NSWSC 1231

Applying the wrong legal test and failing to make required determinations under an Act each constitute errors of law sufficiently serious as to also constitute jurisdictional errors: Craig v South Australia (1995) 184 CLR 163 at 179; Kirk v Industrial Relations Commission of New South Wales [2010] HCA 1; (2010) 239 CLR 531 at [60] to [70]. Identifying a wrong issue or asking a wrong question in a way that affects the exercise of power is to make an error of law: Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at [82].

58The concept of jurisdictional error also includes "constructive failures to exercise jurisdiction" – see, for example, Jordan CJ in the leading case of Ex parte Hebburn Ltd; Re Kearsley Shire Council (1947) 47 SR (NSW) 416; (1947) 64 WN (NSW) 107. In that case Jordan CJ said at 420:

"I quite agree that the mere fact that a tribunal has made a mistake of law, even as to the proper construction of a statute, does not necessarily constitute a constructive failure to exercise jurisdiction … But there are mistakes and mistakes; and if a mistake of law as to the proper construction of a statute investing a tribunal with jurisdiction leads it to misunderstand the nature of the jurisdiction which it is to exercise, and to apply a "wrong and inadmissible test": … or to "misconceive its duty", or "not to apply itself to the question which the law prescribes": The King v War Pensions Entitlement Appeal Tribunal; or "to misunderstand the nature of the opinion which it is to form": The King v Connell (1944) 69 CLR 407 at 432, in giving a decision in exercise of its jurisdiction or authority, a decision so given will be regarded as given in a purported and not a real exercise of jurisdiction, leaving the jurisdiction in law constructively unexercised, and the tribunal liable to the issue of a prerogative writ of mandamus to hear and determine the matter according to law …"

59This passage has been adopted in this court (see for example Galluzzo T/As Riverwood Chemworld Chemist v Dianne Little (No 2) [2012] NSWSC 324 at [19]) and by the High Court. In Re Minister for Immigration and Multicultural Affairs; Ex parte Miah [2001] HCA 22; (2001) 206 CLR 57, Gaudron J said at [80]:

"The classic statement as to what constitutes constructive failure to exercise jurisdiction is that of Jordan CJ in Ex parte Hebburn Ltd; Re Kearsley Shire Council. That statement, which has been approved by this Court on numerous occasions identifies a constructive failure to exercise jurisdiction as occurring when a decision-maker 'misunderstand[s] the nature of the jurisdiction which [he or she] is to exercise, and … appl[ies] "a wrong and inadmissible test"… or … "misconceive[s his or her] duty," … or "[fails] to apply [himself or herself] to the question which the law prescribes"… or "… misunderstand[s] the nature of the opinion which [he or she] is to form"'." (citations omitted)

60In Yusuf, Gaudron J said at [41]:

"For the purposes of mandamus and prohibition, a tribunal is said to have failed to exercise its jurisdiction if it has wrongly denied the existence of its jurisdiction or mistakenly placed limits on its functions or powers. If the Tribunal wrongly holds it has no jurisdiction or is not authorised to make a particular decision, there is said to be 'an actual failure to exercise jurisdiction'. On the other hand, there is said to be a 'constructive failure to exercise jurisdiction' when a tribunal misunderstands the nature of its jurisdiction and, in consequence, applies a wrong test, misconceives its duty, fails to apply itself to the real question to be decided or misunderstands the nature of the opinion it is to form. A constructive failure to exercise jurisdiction may be disclosed by the Tribunal taking an irrelevant consideration into account. Equally, it may be disclosed by the failure to take a relevant matter into account." (emphasis added)

61In relation to a constructive failure to exercise jurisdiction Beech-Jones J said recently in AAMI Ltd v Ali [2012] NSWSC 969 at [48]:

"There is considerable overlap between this form of error and a breach of natural justice or a constructive failure to exercise jurisdiction. This is so because aspects of those grounds can import a limited 'obligation' to consider at least some of the evidentiary material placed before a decision maker (Cervantes at [19]-[22], per Basten JA). Thus, in Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; 77 ALJR 1088, Gummow and Callinan JJ stated (at [24]) that '[t]o fail to respond to a substantial, clearly articulated argument relying upon established facts was at least to fail to accord Mr Dranichnikov natural justice.' In Re Minister for Immigration and Multicultural Affairs; Ex parte Miah [2001] HCA 22 ; 206 CLR 57, Gaudron J at [81] stated that a failure in that case to address the substance of a person's claim for refugee status was 'a clear case of constructive failure to exercise jurisdiction'. Hence, and only by way of example, a failure to consider a critically relevant piece of evidence may have happened 'in a way that affects the exercise of the power' (Yusuf) because it may reveal that an applicant's case was not addressed or was misunderstood."

62Furthermore a constructive failure to exercise jurisdiction might be disclosed by taking an irrelevant consideration into account or by a failure to take a relevant matter into account: Devic v NRMA Insurance Ltd [2011] NSWSC 1099. I have held above that the Proper Officer's consideration of the failure to provide a WPI for the plaintiff was an irrelevant consideration and that the Proper Officer erred in characterising the lack of submissions on causation.

63I accept that reasons of administrative decision-makers are not to be considered with "an eye minutely and keenly attuned to error" but are to be read beneficially and as a whole (Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; (1996) 185 CLR 259 at 272). I further accept that the reasons of the Proper Officer need only be brief (Medical Assessment Guidelines clause 14.8). However, In my view the Proper Officer failed to exercise her power in determining whether the additional information or the deterioration of the injury was such as to be capable of having a material effect on the outcome of the previous assessment.