Decision
Allianz Australia Insurance Limited v Mandoukos [2025] NSWPICMP 844
Sixty-Second-Or-Less-Read
A motor accident causes a threshold injury to the Claimant’s cervical spine. The Claimant, however, subsequently undergoes cervical surgery which involves the removal of some bone.
Does the consequential surgery constitute a non-threshold injury?
In Allianz v Mandoukos, the Review Panel concluded that, in general terms, consequential surgery does not constitute an “injury“, as defined by s 1.4 of the Motor Accident Injuries Act 2017 in the absence of some detriment to the Claimant. In this dispute, the surgery was not an “injury” because the Claimant consented to the procedure and it resulted in a reduction of pain and an increase in function. The surgery was to the Claimant’s benefit rather than his detriment.
Principles
✅ A Claimant is not entitled to ongoing statutory benefits or common law damages if their only injuries are threshold injuries as defined by section 1.6 of the Motor Accident Injuries Act 2017 (MAIA).
✅ Physiological changes caused by consequential surgery cannot constitute an “injury”, as defined by section 1.4 of MAIA, in the absence of some detriment to the Claimant.
Facts
On 8 January 2019, the Claimant swerved to avoid a motor vehicle which made a turn in front of his vehicle and collided with a light post.
The accident caused a cervical strain and aggravation of pre-existing C5/6 degenerative disc disease.
The Claimant, however, subsequently underwent a C5/6 foraminotomy, which involved removing a segment of bone.
The primary Medical Assessor concluded that the consequential surgery resulted in injury to bone and the partial or complete rupture of ligaments and tendons. The primary Medical Assessor proceeded to certify that the injuries sustained during the consequential surgery were not threshold injuries.
The Insurer successfully sought referral of the threshold injury dispute to the Review Panel.
The Review Panel’s Reasons
The Review Panel accepted that the foraminotomy procedure was reasonable and necessary and caused by the injuries sustained in the motor accident.
The Review Panel, however, concluded that the changes to the Claimant’s body, caused by the surgery, did not constitute an “injury“, as defined in section 1.4 of MAIA, for the following reasons:
🟪 Section 1.4 of MAIA defines “injury” to mean “personal or bodily injury” before proceeding to include psychological injuries, pre-natal injuries and injuries to artificial members, aids and equipment.
🟪 The Court of Appeal made obiter comments in Mandoukos v Allianz Australia Insurance Limited [2024] NSWCA 71 that it is doubtful that consequential surgery could constitute an “injury” in the absence of any detrimental impact on the Claimant’s symptoms or functioning.
🟪 Whilst clause 6.113 of the Motor Accident Guidelines provides that the effect of surgery is to be included in the assessment of permanent impairment, “impairment” and “injury” are not the same thing. “Impairment” is a consequence of “injury“.
🟪 The outcome might be different if the surgery is performed negligently or causes an additional injury. In this case, the surgery was performed competently and improved the Claimant’s symptoms.
The Review Panel, therefore, certified that the surgery did not constitute an “injury” as defined by s 1.4 of MAIA.
If followed that whether the surgery constituted a threshold injury or not did not arise.
Pete’s Perspective
The Scope of the Dispute
At the outset, it is critical to understand that the decision in Mandoukos is not about causation.
The Review Panel specifically accepted that the Claimant’s foraminotomy procedure was caused by the accident.
If the Claimant ultimately demonstrated a non-threshold injury, the defendant would be liable for the full consequences of the surgery in the normal way (absent grossly negligent medical treatment). Those consequences might include, depending on the evidence, an increased WPI assessment and additional economic loss.
The issue in dispute, in Mandoukos, however, related the statutory interpretation of the gateway provisions to ongoing statutory benefits and common law damages.
Namely, whether the Claimant’s surgery constituted an “injury” as defined by s 1.4 of the MAIA. This was critical to the Claimant’s entitlements because the Claimant could not demonstrate a non-threshold injury if the surgery did not even amount to an injury in the first place. And, without a non-threshold injury, the Claimant could not proceed through the statutory gateway and recover ongoing statutory benefits or any common law damages.
So, When Does a Physiological Change Constitute an “Injury”?
At paragraph 131 of its Reasons, the Review Panel helpfully set out indicia of physiological change which might constitute an “injury“:
🟪 The change was unintentional.
🟪 The change was caused by an external force outside the control of the affected person.
🟪 The change is neither planned nor deliberate.
🟪 The change would have an adverse effect on the individual.
🟪 A reasonably minded individual would not consent to the change.
In this dispute:
🟪 The Claimant’s decision to undergo the surgery was deliberate and considered.
🟪 The aim of the surgery was to provide relief to the Claimant’s cervical spine symptoms.
🟪 The surgery did, in fact, improve the Claimant’s pain and function.
What About Treatment Which Goes Wrong?
The Review Panel’s decision in Mandoukos deals with a case where the Claimant’s surgery went to plan.
The outcome is likely to be different if the surgery (or other treatment) does not go to plan and the Claimant suffers further harm, either because the existing injury is exacerbated or a new injury is caused.
There have been some recent Review Panel decisions which concluded that additional harm caused by consequential treatment can constitute a non-threshold injury.
🟪 In Gibbin v AAI Ltd t/as GIO [2025] NSWPICMP 523, the Claimant sustained a rotator cuff tear during a manipulation under anaesthetic procedure. The Review Panel found that the tear was a non-threshold injury caused by the motor accident. My Case Note on Gibbin can be found here.
🟪 In Allianz Australia Insurance Limited v Miles (No 3) [2025] NSWPICMP 565, the Claimant suffered leg weakness following a cortisone injection. The leg weakness caused a fall which caused a right rotator cuff tear. The Review Panel found that the rotator cuff tear was a non-threshold injury caused by the motor accident. My Case Note on Miles can be found here.
What distinguishes these decisions from Mandoukos is that the consequential treatment resulted in detriment to the Claimant. It followed, in each case, that the detrimental physiological change caused by the treatment constituted an “injury” as defined by s 1.4 of MAIA. In these two examples, the injuries in question – rotator cuff tears – fell outside the definition of “threshold injury” in s 1.6.
What About WPI Assessments?
The decision in Mandoukos only relates to whether consequential surgery constitutes an “injury” pursuant to the definition in s 1.4 of MAIA.
As the Review Panel correctly pointed out, when it comes to the assessment of permanent impairment, clause 6.113 of the Motor Accident Guidelines provides that the effect of surgery is to be included in the assessment.
So, this is (yet another) potential anomaly in the legislation.
Consequential surgery which goes to plan and does not cause any additional detriment to the Claimant is not an “injury” pursuant to the definition in s 1.4.
If, however, the Claimant has a non-threshold injury, the effects of surgery related to that injury does count when assessing the Claimant’s permanent impairment.
PJH