The New South Wales Court of Appeal confirms that superficial skin injuries do not represent non-threshold injuries in CTP claims.
In issue
- Whether superficial injuries to skin fall outside the meaning of ‘threshold injury’ under section 1.6 of the Motor Accident Injuries Act 2017 (MAIA) on the basis that ‘organs’ (skin included) are excluded from the definition of ‘soft tissue’.
The background
Under the 2017 NSW CTP scheme, a claimant may seek common law damages and weekly benefits beyond 52 weeks if one or more injuries suffered in a motor vehicle accident are not a ‘threshold injury’ (i.e. not ‘soft tissue injury’ in the case of physical injuries) under section 1.6 of the MAIA as below:
In essence, the provision acts as a filter to ensure that more significant compensation is reserved for more significant injuries. However, because the language of the section relies on the characteristics of injuries as a proxy for severity, it is sometimes difficult to identify what is, or is not, a threshold injury.
The late Summer Abawi (her passing being unrelated to the accident, and now represented by the Estate) had sustained superficial abrasions and bruising to the skin of both wrists in a motor vehicle accident. Relevantly, the skin injury did not include any injury to nerves. The threshold injury dispute had previously been considered by the Personal Injury Commission’s Review Panel, who determined that as the skin was an ‘organ’, it was excluded from the category of ‘soft tissue injury’ and that the injury was therefore a non-threshold injury. Allianz sought Judicial Review of the determination from the Supreme Court of New South Wales, who affirmed the outcome of the Review Panel’s determination. Allianz then applied to bring the matter before the Court of Appeal (the present decision).
The decision at trial
The appellant advanced several purposive arguments, including a ‘floodgate’ argument that the filtering purpose of the section would be rendered inoperable if superficial skin injuries were not regarding as threshold injuries. The appellant also emphasised the need to keep premiums low by being able to filter out less significant claims from entitlement to more significant compensation, by reference to one of the objects of the MAIA. However, these arguments were rejected by the Court of Appeal which found insufficient evidence to support the former argument, and found insufficient reason to prefer one object over the others regarding the latter argument.
Ultimately the arguments were narrowed down to competing interpretations of the word ‘other’ as a qualifier to the words ‘structures or organs of the body’. The respondent advanced the argument that that the word ‘other’ only applied to ‘structures’ but not ‘organs’, meaning that the Act did not contemplate organs as supporting other organs in the sense of connecting, supporting or surrounding them, but instead meant to exclude organs as a whole from the category of ‘soft tissue’. The respondent also argued that the contrary view would result in significant skin injuries – such as deep lacerations, burns or road rash being unreasonably categorised as mere ‘soft tissue’ injuries. This argument was rejected however: the Court of Appeal considered that these more significant injuries may well include a nerve component which would otherwise qualify them as non-threshold injuries.
The appellant however advanced a construction that read ‘other’ as applying to both ‘structures or organs’, contemplating that skin (though an organ) could still be considered ‘soft tissue’ based on the primary (structural) function of the organ. The Court of Appeal agreed, and held that the important question was about the main purpose of the organ: if an organ’s purpose was primarily structural as in the case of skin, it could still be ‘tissue that connects, supports, or surrounds other structures or organs’ even if it was technically an organ itself.
Implications for you
The Court of Appeal affirmed the view that superficial injuries to the skin are ‘soft tissue injuries’, and therefore ‘threshold’ injuries under section 1.6 of the MAIA. This is despite the skin technically being an organ of the body: the skin was distinguished by its structural function from other organs such as the heart or the brain.
This case brings the interpretation of section 1.6 back to a state similar to its prior state. For a claimant to show that that there has been a non-threshold injury to skin, it will likely be necessary to be able to show that the skin injury goes beyond the mere structural purpose of the skin, and extends to compromising nerve function or some other non-structural function. The Court of Appeal recognised that this criteria may be met in cases involving particularly bad skin injuries such as road rash, burns or deep lacerations, given the increased likelihood of injury to the nerves being involved.
Allianz Australia Insurance Limited v Estate of the Late Summer Abawi [2025] NSWCA 85
