Allianz Australia Insurance Ltd v GSF Australia Pty Ltd - [2005] HCA 26

HIGH COURT OF AUSTRALIA
McHUGH, GUMMOW, HAYNE, CALLINAN AND HEYDON JJ
ALLIANZ AUSTRALIA INSURANCE LIMITED APPELLANT
AND
GSF AUSTRALIA PTY LIMITED & ANOR RESPONDENTS
Allianz Australia Insurance Limited v GSF Australia Pty Limited
[2005] HCA 26
19 May 2005
S247/2004
ORDER
1.Appeal allowed.
2.The first respondent (GSF Australia Pty Ltd - "GSF") pay the costs of the appellant (Allianz Australia Insurance Ltd - "Allianz").
3.Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 1 July 2003 and in their place order:
(a)the appeal to the Court of Appeal is allowed;

(b)GSF pay the costs of Allianz of the appeal to the Court of Appeal;

(c)Orders 1, 4 and 5 of the orders of the District Court of New South Wales made on 14 June 2002 are set aside and in their place order:

(i)judgment for the plaintiff against GSF in the sum of $450,000;

(ii) judgment for Allianz against GSF;

(iii) GSF pay the costs of Allianz in the District Court.

On appeal from the Supreme Court of New South Wales
Representation:
K P Rewell SC with P S L Dooley for the appellant (instructed by TL Lawyers)
L King SC with J W Catsanos for the respondent (instructed by Blake Dawson Waldron)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS
Allianz Australia Insurance Limited v GSF Australia Pty Ltd
Insurance – Motor vehicles – Third party liability insurance – Truck and trailer provided by first respondent to convey packed containers of food to airport – Appellant insurer of vehicle – Second respondent an employee of first respondent – Second respondent suffered back injury while assisting in unloading containers after vehicle's lifting mechanism became inoperative – Whether second respondent's injury an "injury" within the meaning of the Motor Accidents Act 1988 (NSW).
Insurance – Motor vehicles – Third party liability insurance – Causation – Whether second respondent's injury a result of and caused during use or operation of the vehicle by a defect in the vehicle – Utility of "common sense" tests for causation and notions of proximate cause.
Statutes – Construction – Purposive construction – Where object of the Motor Accidents Act 1988 (NSW), as amended, to contain overall costs of compulsory third party insurance scheme within reasonable bounds – Whether consistent with an expansive notion of causation of injury.
Words and phrases: "a result of", "caused".
Motor Accidents Act 1988 (NSW), ss 3(1), 69(1).

McHUGH J. The central issue in this appeal is whether an injury sustained by an employee while unloading containers from a vehicle whose unloading mechanism was defective was an "injury" as defined by s 3(1) of the Motor Accidents Act 1988 (NSW) ("the Act") (as amended by the Motor Accidents Amendment Act 1995 (NSW)).
In my opinion, the injury that the employee suffered was not an injury for the purpose of the Act. That is because in an unloading case there is no "injury" within the meaning of the Act unless the injury was the result of and caused by a defect in the vehicle. Whether or not a defect causes an injury for the purpose of the Act has to be evaluated in the light of the objects of the Act. Those objects demonstrate that the defective unloading mechanism did not cause the injury because the defect was merely a condition and not a cause of the injury. It was the unsafe system of the employer – not the defect in the vehicle – that caused the employee's injury.
Statement of the case
Garry Oliver sued GSF Australia Pty Ltd ("GSF"), his employer, for damages in the District Court of New South Wales. The action was settled. GSF conceded that it was negligent in requiring Mr Oliver to work under an unsafe system of work. However, a dispute arose as to which of two insurers should indemnify GSF: the compulsory third party insurer of the vehicle, Allianz Australia Insurance Ltd ("Allianz") or the workers' compensation insurer, QBE. As a result, Mr Oliver and GSF made two agreements concerning the damages that Mr Oliver was to receive. If QBE was liable to indemnify GSF, Mr Oliver was to receive $450,000, based upon a notional assessment of damages under the Workers Compensation Act 1987 (NSW) ("the Workers Compensation Act"). If Allianz was liable, Mr Oliver was to receive $460,000, based on a notional assessment of damages under the Act.
Allianz applied to be, and was, joined as a party to the District Court proceedings between Mr Oliver and GSF. The District Court (Delaney DCJ) held that Mr Oliver's injury gave rise to an indemnity by Allianz because the injury occurred in circumstances that made it an "injury" as defined by s 3(1) of the Act. The injury was therefore covered by the motor vehicle policy issued by Allianz. His Honour entered judgment in favour of Mr Oliver for $460,000 and ordered that Allianz pay GSF "by way of indemnification" the sum of $230,000 on the basis that it was a case of "dual insurance".
Allianz appealed to the Court of Appeal on the ground that the injury was not an "injury" within the meaning of that term as defined in s 3(1) of the Act. By majority (Mason P and Davies AJA, Santow JA dissenting), the Court of Appeal dismissed Allianz's appeal.
The material facts
GSF employed Mr Oliver as a maintenance technician. On 12 February 1998, it directed him to assist in unloading airline containers from the back of a truck owned by GSF. The truck had been specifically modified to facilitate the unloading of airline containers. Rollers had been installed on the floor of the trailer and a T-bar mechanism, which was an electric/pneumatic device, was used to push the airline containers to the rear of the truck, where they could be removed by a forklift truck. The T-bar mechanism was driven by a motor and a gearbox and was activated by pushing a button on a panel at the rear of the truck. The effect of the T-bar and roller system was that no manual effort was required to move the containers to the rear of the truck.
On 11 February 1998, the gearbox broke and the T-bar unloading mechanism became inoperative. GSF knew that the unloading mechanism had become inoperative but did not repair it. Instead, it directed Mr Oliver and another employee to perform the task of unloading the truck manually. GSF gave Mr Oliver no instructions as to how to unload the truck. Mr Oliver and his colleague used pinch-bars or crowbars to manoeuvre the containers along the rollers to the rear of the truck, where the containers would be lifted off by forklift. The containers weighed approximately one tonne each. It was not disputed that this was an unsafe system of work. In the course of this work, Mr Oliver suffered an injury to his lower back.
The legislation
The difficulty of the case arises from the failure of the Act to state expressly or inferentially that that Act does not apply if the Workers Compensation Act or, indeed, any other statutory public liability scheme, applies to the facts of the case. Part 6 of the Act governs the award of damages for injuries sustained in incidents involving motor vehicles. That Part is "concerned with controlling the amount of recoverable damage under the legislation to ensure that the scheme under the legislation is affordable."[1] Section 69(1) provides that the Part "applies to and in respect of an award of damages which relates to the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle." Section 69(1) is the principal operative provision governing the award of damages under the Act[2]. For the purposes of this appeal the key term in s 69(1) is "injury", which is defined in s 3(1) of the Act as follows:
[1]Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2003) 57 NSWLR 321 at 329 [32] per Santow JA.
[2]Part 6 provides for the awarding of damages and deals with matters such as the determination of economic and non-economic loss, including the claimant's prospects of future economic loss, applicable discount rates, payment of interest, the effect of defences such as contributory negligence and voluntary assumption of risk, the non-applicability of exemplary or punitive damages and the apportionment of damages.
"injury:
(a)means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle if, and only if, the injury is a result of and is caused during:
(i) the driving of the vehicle, or
(ii) a collision, or action taken to avoid a collision, with the vehicle, or
(iii) the vehicle's running out of control, or
(iv) such use or operation by a defect in the vehicle, and
(b)      includes:
(i)       pre-natal injury, and
(ii)      psychological or psychiatric injury, and
(iii)damage to artificial members, eyes or teeth, crutches or other aids or spectacle glasses."
This definition of injury was inserted by the Motor Accidents Amendment Act 1995 (NSW)[3] ("the 1995 Act"). The appeal concerns the application of par (a)(iv) of the definition of "injury" in s 3(1) of that Act. It gives rise to the issue whether Mr Oliver's injury was "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle if, and only if, the injury is a result of and is caused during … such use or operation by a defect in the vehicle".
[3]Schedule 1, Item 4.
The definition of "injury" mirrors the terms of s 69(1). The words of s 69(1) emphasise two basic requirements for the Act to apply[4]: the injury must be caused "by the fault of the owner" of the vehicle and the injury must be caused by the fault of the owner "in the use or operation of the vehicle".
[4]Allianz (2003) 57 NSWLR 321 at 329 [34].
The rest of the definition of injury in s 3(1)(a) is then incorporated into s 69(1) by reference[5]. For sub-par (iv) to apply, the injury must be "a result of and is caused during … such use or operation by a defect in the vehicle".
[5]Allianz (2003) 57 NSWLR 321 at 329 [34].
Significance of definition sections
Except in rare cases, definitions are not intended to enact substantive rules of law. Their function is to aid the construction of those substantive enactments that contain the defined term or terms. Moreover, the meaning of the definition depends on the context and object of the substantive enactment. As I pointed out in Kelly v The Queen[6]:
"[T]he function of a definition is not to enact substantive law. It is to provide aid in construing the statute. Nothing is more likely to defeat the intention of the legislature than to give a definition a narrow, literal meaning and then use that meaning to negate the evident policy or purpose of a substantive enactment. … [O]nce … the definition applies, … the only proper … course is to read the words of the definition into the substantive enactment and then construe the substantive enactment – in its extended or confined sense – in its context and bearing in mind its purpose and the mischief that it was designed to overcome. To construe the definition before its text has been inserted into the fabric of the substantive enactment invites error as to the meaning of the substantive enactment. … [T]he true purpose of an interpretation or definition clause [is that it] shortens, but is part of, the text of the substantive enactment to which it applies."
[6](2004) 78 ALJR 538 at 559-560 [103]; 205 ALR 274 at 302.
In this case, therefore, the definition of "injury" is to be read into and applied in respect of s 69(1) of the Act. When that is done, the sub-section, with that term defined, must be construed in the context in which it appears and in light of the objects of that Part and the Act as a whole.
Parties' submissions before this Court
Allianz submitted that Mr Oliver's injury was not "a result of", in any legally causal sense, the use or operation of the vehicle. It contended that Mr Oliver's injury was caused by his participation in the unsafe system of work. Such use or operation of the vehicle as occurred was merely incidental. Allianz submitted that the definition emphasises that the defect must be truly causative of the injury, and not merely incidental to it.
GSF conceded that sub-pars (i)-(iv) of the definition of injury in s 3(1)(a) limits the class of injuries more generally described in the introductory words of the definition. It conceded that, in construing the definition, one commences with the introductory words and then decides whether any of the four conditions is satisfied. GSF contended that the defective unloading mechanism was a cause of Mr Oliver's injury and occurred in the course of the vehicle's use or operation for unloading. Consequently, the requirements that the injury be "a result of" the defect and "caused during … such use or operation by a defect" were satisfied.
Construction of the term "injury" in s 3(1)
For the Act to apply in the present case, several requirements of the definition must be satisfied:
1.there must be "fault of the owner … of the vehicle". That is, the owner was negligent or had committed another tort (as "fault" is defined in s 3);
2.the fault of the owner must be "in the use or operation" of the vehicle;
3.the injury must be caused "by" the fault of the owner or driver in the use or operation of the vehicle;
4.the injury must be caused "during" such use or operation of the vehicle;
5.the injury must be a result of such use or operation;
6.the injury must be a result of a defect in the vehicle; and
7.the injury must be caused by a defect in the vehicle.
The definition of "injury" emphasises the element of "cause" as the key factor that governs the entitlement to compensation. So far as sub-par (iv) is concerned, the definition has a dual aspect of causation. The first aspect appears in the introductory words of the definition and considers causation from the point of view of a human actor (the owner or driver): "caused by the fault of the owner … of a motor vehicle in the use or operation of the vehicle". The second aspect requires the injury to be the result of something inanimate, namely, a defect in the vehicle. The second aspect also contains a temporal requirement, namely, that the injury must be "caused during" the relevant timeframe.
The definition requires the injury to be caused by something inanimate only where there is a defect in the vehicle ("the injury is a result of and is caused during ... such use or operation by a defect in the vehicle"). The other conditions in sub-pars (i)-(iii) require that the injury:
.be a result of the driving of the vehicle or a collision (or action taken to avoid a collision) or the vehicle running out of control,
.be caused during the driving, the collision (or action taken to avoid a collision) or the vehicle running out of control (the temporal requirement).
The first aspect of causation: "caused by the fault of the owner … in the use or operation of the vehicle"
This part of the definition considers causation from the point of view of a human actor. The injury must be "caused by the fault of the owner … in the use or operation of the vehicle". This part of the definition can be broken down into its constituent elements: there must be "fault" of the owner, that fault must be "in" the use or operation of the vehicle and the injury must be "caused by" the fault of the owner in that use or operation.
In this case, the fault (negligence) of the defendant employer and the causal impact of that negligence was conceded before the Court of Appeal[7]. The direction given by the employer resulted in an unsafe system of work. There was no dispute that GSF was negligent in using an unsafe system of work that required Mr Oliver to carry out the task of manually manoeuvring the containers to the rear of the truck. GSF also conceded before the Court of Appeal that the fault of the owner occurred "in" the use or operation of the vehicle as that expression appears in the introductory words of s 3(1)(a) of the Act[8].
[7]Allianz (2003) 57 NSWLR 321 at 335 [62] per Davies AJA.
[8]Allianz (2003) 57 NSWLR 321 at 335-336 [63] per Davies AJA.
Santow JA took the view that the word "in", in the expression "in the use or operation of the vehicle", simply meant "in relation to" or "in the course of"[9]. This construction is correct because the words focus on the fault of the owner in its capacity as owner. Failure by the owner to fix the defective unloading mechanism satisfies this requirement, as would a direction to use an unsafe system of work to unload the vehicle.
[9]Allianz (2003) 57 NSWLR 321 at 330 [38].
In the Court of Appeal, GSF also conceded that the injury was caused by the fault of the owner of the vehicle in the use or operation of the vehicle. As Davies AJA observed[10]:
"The vehicle ought not to have been used to transport the employer's goods whilst its unloading mechanism, the T-bar, was inoperable. The employer's goods were too heavy to be moved manually without a risk of injury of the type which Mr Oliver suffered."
[10]Allianz (2003) 57 NSWLR 321 at 335-336 [63].
The second aspect of causation: preliminary matters
The second aspect of causation relates to the four conditions that limit the general class of injuries to which the Act applies. Where there is a defect in the vehicle, the injury must be "a result of and is caused during ... such use or operation by a defect in the vehicle".
The expression "caused during such use or operation" imposes a temporal causal requirement. Where there is a defect in the vehicle, the defect must be operative when the injury is sustained and the vehicle must be in "such use or operation" to which the fault of the owner attaches when the injury is sustained. Allianz conceded that Mr Oliver's injury occurred during the use or operation of the vehicle[11].
[11]Allianz (2003) 57 NSWLR 321 at 336 [64] per Davies AJA.
Further, the expression "such use or operation" in s 3(1)(a)(iv) refers to the "use or operation" of the vehicle in the opening words of the definition. In Zurich Australian Insurance Ltd v CSR Ltd, the New South Wales Court of Appeal held correctly that "such" generally refers to use and operation in the introductory paragraph, not to sub-pars (i), (ii) and (iii) in the definition[12].
[12](2001) 52 NSWLR 193 at 201 [32] per Spigelman CJ, Mason P and Handley JA agreeing.
Allianz contended that the effect of the word "such" in sub-par (iv) is to confine the operation of the defect provisions to the use or operation of the vehicle in the senses referred to in s 3(1)(a)(i)-(iii). It contended that this construction is consistent with the legislative purpose of the section as evidenced by the Second Reading speech[13]. This construction must be rejected for three reasons. First, the construction would make sub-pars (i), (ii) and (iii) redundant. Secondly, this conclusion is not consistent with the use of the disjunctive "or" between each sub‑section. Thirdly, the construction is also inconsistent with s 3(6), which provides that a reference to the use or operation of a motor vehicle includes a reference to the maintenance or parking of the vehicle[14]. An "injury" within the meaning of the Act may therefore occur while a person is performing maintenance on the vehicle, which generally occurs when the vehicle is not in motion.
[13]New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3322.
[14]Section 3(6) has always been in these terms.
The question then arises whether the unloading of the trailer constitutes "such use or operation" of the vehicle for the purposes of the Act. Davies AJA held that "[t]he loading or unloading of a vehicle, ... which was designed to transport goods, may be a part of the use or operation of a vehicle"[15], and "[t]he loading and unloading of the employer's vehicle were essential parts of the operation for which the vehicle was used ... [which was] the transport of the loaded containers from the employer's premises to the airport."[16] This conclusion accords with the statement of Windeyer J in Government Insurance Office of NSW v R J Green & Lloyd Pty Ltd[17] where his Honour said:
"Any use that is not utterly foreign to its character as a motor vehicle is, I consider, covered by the words ['use of a motor vehicle']. … The loading of a vehicle designed to be used, and ordinarily used, for the carriage of goods is a necessary element in its ordinary use. Loading it is incidental to the use of it in the normal way."
[15]Allianz (2003) 57 NSWLR 321 at 336 [64], citing NRMA Insurance Ltd v NSW Grain Corporation (1995) 22 MVR 317; Zurich Australian Insurance Ltd v CSR Ltd (2001) 52 NSWLR 193.
[16]Allianz (2003) 57 NSWLR 321 at 336 [64].
[17](1966) 114 CLR 437 at 446-447.

In R J Green & Lloyd, this Court accepted that the word "use" has a wide meaning and covers loading and unloading.
In NRMA Insurance Ltd v NSW Grain Corporation[18] – which was decided before the commencement of the 1995 Act – the Court of Appeal held that the Act applied to injuries sustained during loading and unloading operations. The Act did so where an injury was caused by the fault of the owner in the use or operation of the vehicle. The Court held that an unsafe system of work that involved loading or unloading operations could constitute "fault of the owner … in the use or operation of the vehicle" within the meaning of the Act.
[18](1995) 22 MVR 317. Cases which turned on the definition of "use or operation of the vehicle" include Mercantile Mutual Insurance (Australia) Ltd v Moulding (1995) 22 MVR 325 and Prospect County Council v Foster (2001) 33 MVR 228.
The amendments effected by the 1995 Act do not result in the Act automatically excluding acts of loading and unloading a vehicle from the concept of "use or operation" of the vehicle. The Act restricts the circumstances in which the Act governs an injury sustained during loading and unloading operations (the injury must be "a result of and is caused during … such use or operation by a defect in the vehicle"). However, the Act neither expressly nor inferentially excludes all loading and unloading activities from the expression "use or operation" of the vehicle. Its application is governed by the cause of the injury, but not by the activity in which the person injured was engaged when the injury was sustained.
The third aspect of causation: "a result of and is caused … by a defect in the vehicle"
There was a defect in the vehicle within the meaning of the definition. In its ordinary usage, a defect means "a lack or absence of something necessary or essential for completeness; a shortcoming or deficiency [which] may be either major or minor."[19] It may be a defect in the design or the original construction of the vehicle or may arise because the vehicle is not kept in proper condition[20]. One of the important functions of the vehicle was the use of a T-bar mechanism to push containers to the rear of the truck where they could be unloaded. This function was incapable of being performed because the mechanism was defective. As Mason P pointed out[21] "[t]here was a defect in the vehicle because one of the important things it was designed to do was not functioning, that is, was defective." Santow JA[22] and Davies AJA[23] agreed.
[19]Topfelt Pty Ltd v State Bank of New South Wales Ltd (1993) 47 FCR 226 at 237 per Lockhart J.
[20]See the discussion of Spigelman CJ in Zurich (2001) 52 NSWLR 193 at 202-207 [42]-[71].
[21]Allianz (2003) 57 NSWLR 321 at 323 [3].
[22]Allianz (2003) 57 NSWLR 321 at 326 [23], 333-334 [51].
[23]Davies AJA held that "[o]nce the gearbox to the T-bar had failed and the T-bar was inoperable, the vehicle was unsuitable for the function it was designed to perform, the transport of the employer’s goods." Allianz (2003) 57 NSWLR 321 at 336 [66], citing Zurich (2001) 52 NSWLR 193 at 202-207 [42]-[71].
In Zurich[24], Spigelman CJ drew a distinction between a "defect" and a "negligent user" for the purposes of the Act, although he acknowledged that the distinction "may not always prove helpful":
"The defect must be 'in' the vehicle. A vehicle is not 'defective' only because its operation in a particular manner may lead to injury. However, the manner in which it is intended to operate may determine whether there is a 'defect' 'in' the vehicle."
His Honour also thought that an appropriate perspective from which to approach the question of a "defect in the vehicle" for the purposes of the Act is the fitness of the vehicle for its intended use[25].
[24](2001) 52 NSWLR 193 at 206-207 [68] (emphasis in original).
[25]Zurich (2001) 52 NSWLR 193 at 206 [67].
Allianz contended, however, that, because there was a negligent use of the vehicle – the inability to use the out-of-repair lifting mechanism and the requirement to lift manually – there was no "defect" in the context of its "intended use". Nor was there a "defect" in the sense of an inherent defect. Santow JA correctly rejected this contention saying[26] that "a lifting mechanism that is out of repair, taking into account its intended use as a lifting mechanism, clearly represents a defect in the vehicle."
[26]Allianz (2003) 57 NSWLR 321 at 334 [53].
"[A] result of and … caused … by a defect in the vehicle"
In considering the construction of the requirement that the injury be "a result of and ... caused … by a defect in the vehicle", two matters must be noted.
1.First, the second aspect of causation in the definition requires the injury to be caused by something inanimate (a defect in the vehicle).
2.Secondly, the approach to the question of causation must be considered in the context of the Act.
One difficulty with the definition of injury is that it imposes a causal requirement in respect of something inanimate – a defect in the vehicle – as if the defect itself could "cause" the injury. As I pointed out in Insurance Commission of Western Australia v Container Handlers Pty Ltd, leaving aside natural catastrophes such as volcanoes, earthquakes and tidal waves, inanimate objects do not cause anything. Inanimate objects (even defective ones) are not the cause of the harm that people suffer by coming into contact with them. I stated[27]:
"Both scientific and modern common law doctrines of causation as well as common sense … deny that inert objects such as vehicles cause anything. Whilst the use of inert objects may have effects, this is because they are the instruments by which living creatures bring about those effects. … [T]he notion that a vehicle may cause death or bodily injury without human intervention is not easy to understand."
[27](2004) 78 ALJR 821 at 826-827 [18]; 206 ALR 335 at 342.
This reasoning applies to defects in inanimate objects. The expressions "a result of … such use or operation by a defect in the vehicle" and "caused … by a defect in the vehicle" look to the defect in the vehicle as the harm-causing instrument and require a connection between the vehicle as the harm-causing instrument and the injury.
Although the expression "a result of … [the] defect" requires a causal connection between the defect and the injury, that connection does not have to be a "direct" connection or the only connection. The section speaks of the injury being "a" result of, not "the" result of, the defect. Mason P thought that, because the injury must be "a result of" and not "the result of" the defect, the injury need not be the "direct" or "effective" or "efficient" result of the defect[28]. The use of the indefinite article "a" instead of the definite article "the" suggests that the defect in the vehicle does not have to be the sole or even the predominant cause of the injury.
[28]Allianz (2003) 57 NSWLR 321 at 324-325 [15] per Mason P.
Nevertheless, there must be a connection between the defect and the injury. The defect must be one of the elements in the chain of events that leads to the injury. The causal inquiry as to whether the injury is "a result of … [the] defect" requires a less direct connection than the inquiry as to whether the injury is "caused … by [the] defect". The expression "a result of" emphasises the result or effect of the defect, rather than the defect causing the result. The term "result" emphasises effect and is less concerned with the proximity of cause and effect.
In contrast to sub-pars (i)-(iii) of the definition, the expression "a result of" appears to have little work to do in relation to sub‑par (iv). Sub-paragraphs (i)-(iii) impose a temporal requirement – that the injury be caused during the driving of the vehicle, a collision (or action taken to avoid a collision) or the vehicle's running out of control – and a causal requirement – that the injury be a result of those activities. But sub-par (iv) imposes the temporal requirement that the injury be caused during the use or operation of the vehicle and the causal requirement that the injury be caused by the defect.
One construction of the definition that gives "a result of" some work to do in sub-par (iv) is to hold that the expression requires the injury to be "a result of" the use or operation of the vehicle. In other words, there must be a temporal causal connection between the use or operation of the vehicle, the defect and the injury sustained. The defect must somehow operate during the use or operation of the vehicle as a factor that brings about the injury. The mere fact that there is a defect in the vehicle is not sufficient to satisfy the requirement that the injury be "a result of" the defect.
The causal inquiry in s 3(1)(a)(iv)
In the end, the outcome of this appeal turns on the construction of the words "caused … by a defect in the vehicle". The language of the Act reflects the concept of causation at common law. This suggests that the inquiry into the question of causation under the Act does not differ materially from the "common sense" test for causation at common law. However, because the task before the Court is one of statutory construction, the question of causation must be determined in light of the subject, scope and objects of the Act. The common law concept of causation is concerned with determining whether some breach of a legal norm was so significant that, as a matter of common sense, it should be regarded as a cause of damage[29]. In the present case, however, common law conceptions of causation must be applied having regard to the terms or objects of the Act. Those terms and objects of the Act operate to modify the common law's practical or common sense concept of causation. The inquiry into the question of causality is therefore not based simply on notions of "common sense". In NRMA Insurance Ltd v NSW Grain Corporation[30], Clarke JA said that the Act compels a "common sense" approach to the question of causality of the injury (as prevails in relation to the common law):
"[The Act] propounds an inquiry on causation identical with that undertaken in determining whether the negligence of the person claiming indemnity 'caused' the damage and thus was liable for it. That test has now been firmly based on common sense. … It would not be reasonable, in my opinion, to attribute to the legislature an intention that the expression 'caused by' in the statutory policy should enliven a test of causation different from the test by which the party claiming indemnity had been found liable."
[29]Henville v Walker (2001) 206 CLR 459 at 490 [97] per McHugh J.
[30](1995) 22 MVR 317 at 320.
However, the purpose of the inquiry must be ascertained before the application of any notion of "common sense". The purpose of the causal inquiry is critical because it conditions the result. Once the purpose of the inquiry is ascertained, the question of causality must be determined in light of the subject, scope and objects of the Act. Both Mason P[31] and Santow JA[32] acknowledged the importance of considering the purpose of the causal inquiry because the purpose "conditions the outcome of any application of common sense to its answer"[33].
[31]Allianz (2003) 57 NSWLR 321 at 323 [7], citing Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22 at 29-30 per Lord Hoffmann.
[32]Allianz (2003) 57 NSWLR 321 at 330 [40], citing Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22 at 29 per Lord Hoffmann.
[33]Allianz (2003) 57 NSWLR 321 at 330 [40].
Although the Act establishes a compulsory third party insurance scheme for motor vehicle injuries, the Act does not and was never intended to provide a universal, comprehensive scheme to award damages to every person who sustains an injury that was in some way connected to a motor vehicle. The Attorney‑General made a statement to this effect when he gave the Second Reading speech for the 1995 Bill[34]:
"The CTP policy and the motor accidents scheme simply are not, and were never intended to be, a comprehensive accident compensation scheme providing substantial damages in all cases of injuries connected in some way to the use of a motor vehicle."
[34]New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3322.
To the extent that Gunter v State Transit Authority of NSW[35] suggests that the purpose of the Act is to provide a universal coverage scheme for all motor vehicle accidents, it should not be followed.
[35][2004] NSWCA 330 at [16] per Young CJ in Eq, Tobias JA and Wood CJ at CL agreeing.
The objects of the Act
The 1995 Act inserted ss 2A, 68A and 2B into the Act. Section 2A sets out the objects of the Act, which include the following:
"(2) It must be acknowledged in the application and administration of this Act:
(a)that participants in the scheme under this Act have shared and integrated roles with the overall aim of benefiting all members of the motoring public by keeping the overall costs of the scheme within reasonable bounds so as to keep premiums affordable, and
…
(c) that:
(i)the premium pool from which each insurer pays claims consists at any given time of a finite amount of money, and
(ii)insurers are obliged under this Act to charge premiums that will fully fund their anticipated liability, and
(iii)the preparation of fully funded premiums requires a large measure of stability and predictability regarding the likely future number and cost of claims arising under policies sold once the premium is in place, and
(iv)the stability and predictability referred to in subparagraph (iii) require consistent and stable application of the law."
Section 68A provides that the objects of Pt 6 are:
"(a)to control the amount of damages that may be awarded to a claimant for the purpose of ensuring that the scheme under this Act is affordable, and
(b)to achieve this control by the deliberate strategy of placing the burden of ensuring affordability on those who suffer relatively minor injuries so that sufficient funds are available to more fully compensate those who suffer more severe injuries."
Section 2B provides that in interpreting the Act, a construction that would promote the object of the Act is to be preferred to a construction that would not promote that object. The above objects indicate that insurers are obliged to charge premiums that will fully fund their anticipated liability and that the premium pool from which claims are paid is finite. They also indicate a need to keep the overall costs of the scheme within reasonable bounds so as to keep premiums affordable. The amendments disclose a cost-saving objective.
The Second Reading speech also suggests that the Legislature intended to amend the relevant sections of the Act so as to limit the scope of the motor accidents scheme in New South Wales by keeping premiums under control, perhaps even reducing them. The critical part of the second reading speech for the 1995 Bill is the following statement by the Attorney-General[36]:
"Common sense and community expectations generally demand that the CTP policy provide coverage in respect of injuries which arise from crashes and collisions on the roads or from vehicles running out of control. Over the years the courts have interpreted the CTP policy as providing for a wide range of injuries often unrelated to motor accidents. For example, the CTP policy has been held to cover injuries sustained during the loading and unloading of vehicles, and injuries sustained while standing on the back of a stationary trailer, and injuries involved in the use of a firearm in a vehicle.
It is therefore proposed to amend the definition of 'injury' to adopt an approach similar to that taken in Queensland, South Australia and Western Australia, where 'injury' is qualified in terms of its cause."
[36]New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3322.
Santow JA held, correctly in my opinion, that, consistent with the Minister's Second Reading speech, the Act announces its own purposes in s 2A, and that cost-saving is the predominant consideration[37]. His Honour held that in light of the cost-saving purposes of the Act, the breadth of its application is a relevant consideration. He found that "[i]f motor accident liability encompasses what is really employer liability, that purpose is clearly not served."[38] Given also that s 2B directs a construction of the Act that promotes its object over one that does not, "[a]ny narrowing of its coverage readily supports the cost-saving objects of the … legislation. Any extension does the opposite. … The 1995 amendments were introduced to narrow the definition of injury and thus its reach."[39]
[37]Allianz (2003) 57 NSWLR 321 at 332 [44].
[38]Allianz (2003) 57 NSWLR 321 at 332 [44].
[39]Allianz (2003) 57 NSWLR 321 at 332 [44].
In pursuit of the Act's objects, Parliament has limited the scope of the Act by means of the concept of causation. The amendment requires a close causal connection between the use of the vehicle and the injury. Mere connection "in some way to the use of a motor vehicle" is not enough to bring an injury within the scope of the Act. The general class of injury described in the introductory expression of the definition of injury in s 3(1) still includes injuries sustained during loading and unloading operations. However, the four conditions in sub-pars (a)(i)-(iv) limit the class more generally described in the introductory expression.
The history of the legislation shows how unloading and similar cases were removed from the scope of the Act. The Act effectively replaced the Motor Vehicles (Third Party Insurance) Act 1942 (NSW) ("the 1942 Act") as the compulsory third party insurance scheme for motor vehicle injuries after 1 July 1989. Since the introduction of the Act and the subsequent amendments to that Act, the circumstances in which an injury is governed by the Act have been qualified by a tighter definition of cause. Under the 1942 Act, the third party insurance policy was required to provide cover in respect of any injury that was "caused by or arising out of the use of the motor vehicle"[40]. Under that Act, most loading and unloading injuries fell within the "arising out of" limb, particularly where the only connection with the vehicle was that goods were being loaded into or unloaded from the vehicle[41].
[40]1942 Act, s 10(1)(b).
[41]See, eg Government Insurance Office of NSW v R J Green & Lloyd Pty Ltd (1966) 114 CLR 437.
The expression "arising out of" does not and never has appeared in the Act. Thus, the Act has a narrower scope than the 1942 Act. The words "caused by" are narrower than the words "arising out of" and require a closer causal connection between the event or activity and the injury than the latter phrase implies. However, the removal of the words "arising out of" from the operative provision of the Act does not operate to exclude all loading and unloading cases. Although "arising out of" permitted the 1942 Act to respond in circumstances of "attenuated causation", the Act still applies to injuries sustained during unloading activities, but only "if, and only if" the injury is "caused … by" a defect in the vehicle.
As enacted, the Act effectively restricted claims in loading and unloading cases to circumstances in which the injury was "caused by the fault of the owner … in the use or operation of the vehicle." The Act no longer covered loading and unloading cases where the injury simply arose out of the use of the vehicle. Despite the change in focus of the causal inquiry, as I have indicated the New South Wales Court of Appeal has held that the Act continues to apply to injuries sustained during loading and unloading operations. It applies where the injury was caused by the fault of the owner in the use or operation of the vehicle[42]. However, the amendments bring about the result that the Act does not apply to injuries sustained during loading and unloading operations where there is no defect in the vehicle.
[42]See, eg, NRMA Insurance Ltd v NSW Grain Corporation (1995) 22 MVR 317 at 318-319, where the Court applied the following three‑stage test:
1.Does the evidence establish that there was "fault of the owner or driver … of the vehicle", that is, that the owner was negligent or had committed another tort (as "fault" is defined in s 3)?
2.If yes, did the fault of the owner or driver cause the injury to the claimant?
3.If yes, was the fault of the owner or driver in the use or operation of the vehicle?

The above examination of the subject, scope and purpose of the Act suggests three matters that are relevant in the construction of Pt 6 of the Act. First, the Act does not provide a universal compensation scheme for all injuries sustained in connection with a motor vehicle. Second, cost-saving and the need to keep the scheme affordable are significant objects of the Act. Third, the Act has tightened the definition of injury by reference to its cause. These three matters indicate that, in the inquiry into the question of causality, an approach that limits the scope of the Act is preferable to one that would extend its application. This in turn suggests that a close causal connection is required for the injury to satisfy the requirement the injury be "caused … by a defect in the vehicle".
In addressing the question of causality, metaphysical concepts such as "proximate cause" or "immediate cause" should be avoided, because they provide little, if any, assistance in resolving questions of causation under this Act. The task is to identify the factors that contributed to the injury and determine whether, for the purposes of obtaining damages under the Act, the injury was caused by a defect in the vehicle and not by some other factor. To paraphrase Lord Hoffmann in Environment Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd[43], causality is determined in light of the subject, scope and objects of the Act. At common law, injury may be "caused ... by a defect" even if the act or event in question did no more than materially contribute to the injury[44]. The courts have given an expansive meaning to the word "cause". For example, material contribution may constitute a "cause" for the purpose of determining culpability and a contributory cause may constitute a "cause" for the purposes of tort law[45]. Under the Act, however, there must be a finding that, of the entire set of circumstances that contributed to the injury, it was "a defect in the vehicle" that caused the injury.
[43][1999] 2 AC 22 at 31.
[44]See Henville v Walker (2001) 206 CLR 459 at 469 [14] per Gleeson CJ, 480 [60]‑[61] per Gaudron J, 493 [106] per McHugh J.
[45]See, eg, Chappel v Hart (1998) 195 CLR 232 at 239-240 [11]‑[12] per Gaudron J, 243-245 [26]-[28] per McHugh J.
As I pointed out in Henville v Walker[46], in some situations, the applicable legal framework requires a finding that no causal connection exists for legal purposes even though a physical connection exists between the thing complained of and the damage. In other situations, the legal framework may require a finding that a causal connection exists even though no such physical connection exists. Given the objects of the Act, if the fault of the owner merely provides the reason why the injured person acted, it will not be sufficient to establish a causal connection unless the purpose of the Act is to prevent persons suffering detriment in circumstances of the kind that occurred. Where several factors operate to bring about the injury to a plaintiff, selection of the relevant antecedent (contributing) factor as legally causative requires the making of a value judgment and, often enough, consideration of policy considerations[47]. This is because the determination of a causal question always involves a normative decision.
[46](2001) 206 CLR 459 at 491-492 [100]-[101], [103].
[47]Allianz (2003) 57 NSWLR 321 at 331 [42] per Santow JA, citing Chappel v Hart (1998) 195 CLR 232 at 255 [62] per Gummow J.
Application of the definition
As I earlier pointed out, the definition of "injury" in s 3(1) of the Act contains a triple causation requirement. All requirements must be satisfied for the Act to apply. The first aspect (whether the injury was caused by the fault of the owner in the use or operation of the vehicle) is satisfied in the present case. It is satisfied because GSF failed to maintain the vehicle and negligently instructed its employees to unload the vehicle despite the vehicle's unloading mechanism being out of operation.
In my opinion, however, the second and third requirements of the causal inquiry (whether the injury was "a result of and … caused during ... such use … by a defect in the vehicle") was not satisfied. Mr Oliver's injury was no doubt a result of the defect. But it does not follow that, for the purposes of the Act, the injury was caused by the defect in the vehicle. Where the injury is sustained as a consequence of a defect in the vehicle and does not fall within sub‑pars (i), (ii) or (iii), it will not be "caused ... by" the defect unless the connection between the defect and the injury is more than "a result of" the defect. When the case falls within sub-par (iv), the definition applies only where "the injury is a result of and is caused ... by a defect".
In the present case, two matters contributed to bring about Mr Oliver's injury:
1.the unremedied defect in the unloading mechanism, which rendered the mechanism inoperative; and
2.the employer's negligent direction to Mr Oliver to unload the containers manually.
Of these two elements, it was the second that proved decisive. The unremedied defect, like Mr Oliver's employment and the containers on the vehicle, was merely one of a myriad of background facts that had to exist for the injury to occur. Even if the common law test of causation had to be applied without regard to the context and objects of the Act, I would conclude that, for the purpose of legal responsibility, the passive condition of the defective mechanism was not a cause of Mr Oliver's injury. It was the employer's direction that was significant. Where a person directs another person to take a step that places a person in proximity to a passive condition of danger, it is often the case that it is the direction rather than the condition that causes any subsequent harm. That will generally be the case where the danger consists in some natural phenomenon, such as a cliff or deep water. Leaving aside earthquakes, volcanoes, tidal waves and similar conditions, inanimate objects do not cause harm without human intervention. Where the passive condition has been created by the agency of a third party or the plaintiff, however, the direction may simply be one of two or more causes: creating the danger and directing the injured person to do something near or in relation to the danger. In some circumstances, the omission to repair the danger as well as the direction, may also constitute joint causes of the injury. In a different context, GSF's failure to repair the unloading mechanism could "cause" the injury suffered by a person when using or operating the vehicle.
In the present case, however, Mr Oliver's injury was not a consequence of contact with or use of the unloading mechanism. Even on a common law approach to causation, uncontrolled by the objects of the Act, the defect in the vehicle did not cause Mr Oliver's injury because it had no physical connection with the injury. There was no direction to use the defective loading mechanism. On the contrary, there was a direction to work without it.
But even if at common law, the defect in the vehicle caused the injury, the objects of the Act show that it did not cause it for the purpose of the Act. Given that the objects of Pt 6 and the Act as a whole emphasise cost-saving considerations, an expansive interpretation of the definition of injury would not promote the objects of the Act or Pt 6. Given this consideration and the Legislature's intention to restrict the application of the Act in unloading cases, the best construction of the definition is that, in its application to such cases, there must be a close physical connection between the defect and the injury. And that physical connection must exist in circumstances that would make it consistent with the subject, scope and purpose of the Act for the Act to apply to the injury. Here there was no physical connection. Moreover, the scope and purpose of the Act indicate that, far from the Act being intended generally to cover unloading cases, it was intended to apply to them only in special circumstances.
GSF contended that there was a physical connection between the defect and the injury because there was human involvement with the defect. This contention has no substance. According to this contention, the defect operated in the causal sense because what was done was an attempt to cope with or accommodate the defect. GSF submitted that the gearbox had broken, rendering the T-bar mechanism inoperable, and this meant that the whole unloading apparatus was defective, including the T-bar, the motor and the rollers. It contended that the rollers were part of the defect because they were not working as they were intended to work and were "out of action". It contended that the defect was part of the use of the vehicle because the vehicle was not taken out of operation or immediately repaired. Instead, Mr Oliver and another employee had to "work with it, accommodate it, cope with it". GSF submitted that the requirements of the Act are satisfied where the defect is "one of a number of things necessary to complete the occurrence of the injury and which is operative at all times". That proposition, so it claimed, was satisfied in this case because Mr Oliver and his colleague were "coping" with the defect and "trying to accommodate it – they [were] actually using the damaged or the non-working thing at the time". However, none of these submissions establish a physical connection between the defective unloading mechanism and the injury. At their highest, they do no more than explain the reasons why Mr Oliver and his colleague were doing what they did.
In support of its submission, GSF also relied on the Court of Appeal's decision in Zurich. There the Court held that the employee's injury was "caused … by a defect in the vehicle" in circumstances where the employee injured his back while lifting a loading ramp that formed part of a custom built trailer attached to a truck. The trailer had no aids to assist in the lowering and lifting of the ramps and the worker had no assistance from any colleague. Lifting the ramp manually was the intended use of the vehicle. The Court of Appeal found that the absence of any hydraulic or mechanical lifting mechanism to assist in lifting the ramps was a defect in the design of the vehicle, because it required a worker to behave in a way that was unsafe. This defect was the direct cause of the worker's injury. The employer's negligent instruction was merely to use the vehicle for the purpose and in the manner for which it was intended. This instruction did not operate to take the injury outside the scope of the Act.
In both Zurich and the present case, the worker was instructed to do something which led to the worker being injured. In Zurich, however, the instruction was to use the vehicle for the purpose and in the manner for which it was intended. In the present case, Mr Oliver was instructed to use the vehicle in a manner other than its intended use. And he was instructed to use the vehicle in a way that did not involve the use of the defective part, which was the T‑bar mechanism. Zurich does not assist GSF's contentions.
In my opinion, therefore, the majority of the Court of Appeal erred in finding that, although the negligent direction of the employer was the major reason for Mr Oliver's injury, the involvement of the defect in the vehicle was sufficient to satisfy the definition of the term "injury" in the Act. Mason P erred by conflating the separate concepts of "cause" and "result" in the definition, giving the expression "caused … by" no independent work to do. His Honour used the words "a cause" interchangeably with the words "a result of". He considered only the words "a result of" and failed to consider the words "caused … by". In so doing, he failed both to give the expressions different meanings as required by the Act and to give them cumulative effect. Davies AJA erred because he appeared to hold that the causation requirements of the Act were satisfied if the defect was a link in the causal chain and an element without which the injury would not have occurred[48].
[48]Allianz (2003) 57 NSWLR 321 at 337 [70].
Order
The appeal must be allowed.
GUMMOW, HAYNE AND HEYDON JJ.
The facts
The first respondent ("GSF") conducted a business in which food was packed for conveyance by airlines in containers which were too heavy for manual handling. GSF provided a truck with a trailer attached for the conveyance of packed containers from its premises to an airport. The trailer, which for relevant purposes has been considered as a part of the vehicle, had six rows of rollers. At the premises of GSF, containers were placed on the rollers and pushed inside the trailer by use of a forklift. At the front end of the trailer there was a T‑bar and underneath the trailer a motor and gearbox to drive the T‑bar. At the airport, the containers were unloaded from the trailer by means of the motorised T‑bar which pushed the containers back along the rollers until they were discharged. On the day in question, 12 February 1998, the gearbox had broken down and the T‑bar was inoperable.
The second respondent (Mr Oliver) was employed by GSF as a maintenance fitter. He was not usually involved in loading and unloading operations. On 12 February 1998, he was instructed to go to the airport with another employee to assist in unloading containers. Mr Oliver and his fellow employee were given crowbars and directed to insert these between the rollers and lever the containers to the rear of the trailer. In the course of performing this work, Mr Oliver sustained a back injury.
The insurer of GSF under the workers compensation legislation was QBE Workers Compensation (NSW) Ltd ("QBE"). The appellant ("Allianz") was the insurer of the vehicle under the compulsory third party ("CTP") insurance scheme.
The litigation
The action instituted by Mr Oliver against GSF in the District Court of New South Wales was referred to arbitration and, on 21 November 2001, an award was made in favour of Mr Oliver. Thereafter, GSF applied to the District Court for a limited rehearing, pursuant to s 18 of the Arbitration (Civil Actions) Act 1983 (NSW).
At this stage, the active dispute turned upon a particular aspect of the case. Did the facts and circumstances leading to Mr Oliver's injury give rise to an indemnity under either or both of the Workers Compensation Act 1987 (NSW) ("the Compensation Act") and the Motor Accidents Act 1988 (NSW) ("the Motor Accidents Act")? It was agreed that, if damages were assessed only pursuant to Pt V of the Compensation Act, there should be a verdict for $450,000 in Mr Oliver's favour; if they were assessed pursuant to the Motor Accidents Act, then the sum should be $460,000.
Section 47A of the Motor Accidents Act states:
"An insurer may apply to the court to be joined as a party to legal proceedings brought against a defendant who is insured under a third-party policy with the insurer in order to argue that in the circumstances of the case it has no obligation under the policy to indemnify the defendant."
An order under s 47A was made in the District Court joining Allianz as a party to the proceedings. The other insurer, QBE, has not become a party, but in substance the dispute has been between the two insurers.
The District Court held that the provisions of the Motor Accidents Act were attracted and that there should be judgment in favour of Mr Oliver against GSF in the larger sum of $460,000. It entered judgment accordingly.
In addition to entering judgment in favour of Mr Oliver against GSF in the sum of $460,000, the District Court ordered that Allianz pay GSF "by way of indemnification" the sum of $230,000. This order was made on the concession that, because it had been established that Mr Oliver's claim fell within both legislative regimes, the case was one of "dual insurance".
Allianz appealed to the New South Wales Court of Appeal seeking to set aside the judgment against it obtained by GSF and an order that there be judgment in favour of Mr Oliver against GSF in the sum of $450,000, that is to say, on the footing that only the Compensation Act applied. The Court of Appeal (Mason P and Davies AJA; Santow JA dissenting) dismissed the appeal[49].
[49]Allianz Aust Insurance Ltd v GSF Aust Pty Ltd (2003) 57 NSWLR 321.
In this Court, Allianz seeks orders to the effect of those it unsuccessfully sought in the Court of Appeal. GSF is the first respondent and Mr Oliver the second respondent. Mr Oliver played no active part in the appeal and his position has been protected by arrangement between the other parties after the grant of special leave. It also should be noted that motor vehicle accidents occurring after 5 October 1999 are governed by the Motor Accidents Compensation Act 1999 (NSW) ("the 1999 Act") and not the Motor Accidents Act (s 2AA), but nothing for this appeal turns on that[50]. Other aspects of the scheme established by the Motor Accidents Act were considered by this Court in Russo v Aiello[51].
[50]In particular, the definition of "injury" in s 3 of the 1999 Act does not differ from that on which this case turns.
[51](2003) 215 CLR 643.
The legislation
The critical question on the appeal is the contention, which the majority in the Court of Appeal accepted, that the facts and circumstances gave rise to "injury" within the definition in s 3(1) of the Motor Accidents Act. The submission by Allianz that the Court of Appeal erred should be accepted and the appeal allowed.
Part 6 of the Motor Accidents Act (ss 68-82A) is headed "Awarding of damages". Section 69(1) states:
"This Part applies to and in respect of an award of damages which relates to the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle." (emphasis added)
The term "injury" is then defined in s 3(1) as follows:
"injury:
(a)means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle if, and only if, the injury is a result of and is caused during:
(i)the driving of the vehicle, or
(ii)a collision, or action taken to avoid a collision, with the vehicle, or
(iii)the vehicle's running out of control, or
(iv)such use or operation by a defect in the vehicle, and
(b)includes:
(i)pre-natal injury, and
(ii)psychological or psychiatric injury, and
(iii)damage to artificial members, eyes or teeth, crutches or other aids or spectacle glasses." (emphasis added)
It will be apparent that the opening words in the definition "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle" mirror those in the substantive provision in s 69(1). Section 69(1) was in the same form when the Motor Accidents Act was enacted in 1988. The present definition of "injury" was inserted by the Motor Accidents Amendment Act 1995 (NSW) ("the 1995 Act")[52]. The original definition it replaced did not mirror s 69(1); rather, it stated that "'injury' means personal injury" and that "injury" included what now appears as par (b) of the present definition. The 1995 Act also included (as s 2A and s 2B) provisions dealing with the object and interpretation of the legislation. Further reference will be made to s 2A and s 2B later in these reasons.
[52]Sched 1, Item 4.
The evident purpose of the 1995 Act, which is confirmed by the Second Reading Speech in the Legislative Council on the Bill for the 1995 Act[53], was to limit the definition of injury by its cause and to narrow what the legislature considered the overbroad reading in the case law of the expression in s 69(1) "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle".
[53]New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3320‑3324.

In Zurich Australian Insurance Ltd v CSR Ltd Spigelman CJ rejected a submission that "such" should be read as having the application that I would give it. His Honour said[103]:
"The second submission was that the word 'such' in (a)(iv) did not refer to the words 'use or operation' in the opening words of par (a), but referred to the 'use or operation' comprised in (i), (ii) and (iii), that is, 'driving', 'collision' and 'running out of control'. This construction would deprive (iv) of all content. Paragraph (a)(i) applies to any injury 'caused during ... driving'. That encompasses every injury 'caused during ... driving ... by a defect in the vehicle'. The same is true of par (ii) and par (iii). The construction advanced by the appellant would leave (iv) with no work to do.
The word 'such' in (iv) is, in my opinion, a reference to the preceding use of the precise words which immediately follow it, that is, 'use and operation'. The repetition of this phrase in (iv) was necessitated by the fact that the sub-paragraphs are all qualified by the word 'during'. It makes sense to speak of something occurring 'during' driving, a collision or running out of control. It makes no sense to speak of something occurring 'during' a defect. The words are repeated to identify a time dimension for (iv)."
[103](2001) 52 NSWLR 193 at 201 [31]-[32].
I am unable to agree. The expression "use or operation" is explained, qualified and further refined by sub-pars (i), (ii) and (iii). The word "such" is a reference to that expression as so refined or qualified. Sub-paragraph (iv) does have work to do. It is important to note that the introductory words of the definition speak of the fault of the owner or driver of a motor vehicle. An owner who is not driving the vehicle would not ordinarily be at fault and responsible for an injury within sub-pars (i) and (ii). An owner although he or she could conceivably be at fault when the vehicle ran out of control as contemplated by sub-par (iii), would generally be unlikely to be so. More probably such an event would result from a failure of the last driver to secure the vehicle properly after driving it, or to control it properly when driving it. A running out of control could also be of course a result of a failure by the owner to rectify a defect such as a malfunctioning brake or gearbox. On the other hand the "fault" of an owner would be more likely to be the failure say, of that owner to service the vehicle regularly in order to discover some defect in it, or to rectify a defect in it of which he or she should be aware. In other words the purpose of sub-par (iv) is to sheet home liability for an injury caused by the fault of the owner, if the injury is a result of a defect causing it, during such use or operation, that is, whilst it is being driven as contemplated by sub-pars (i) and (ii) or running out of control as contemplated by sub-par (iii) in circumstances in which the driver has not been at fault.
There is this further point which supports the construction that I prefer. It is that from 1942 until 1988, the relevant definition and policy used the words "arising out of" before the expression "use of a motor vehicle". That language has now been significantly altered by the deletion of the words "arising out of". Those words, as pointed out by Windeyer J in Government Insurance Office of NSW v R J Green & Lloyd Pty Ltd[104], are words of very considerable generality. Their removal provides a further indication of a legislative intention to treat a relevant injury as one caused by fault in the use of a motor vehicle in the course of a use for which it is primarily intended, as a means of movement.
[104](1966) 114 CLR 437 at 447.
If there were any doubt about any of these matters the doubt could have been resolved by reference to the second reading speech. It is difficult to imagine how the speech could have made it plainer. Take for example these words " ... the CTP policy has been held to cover injuries sustained during the loading and unloading of vehicles ... ". Take also the reference to the qualification of injury "in terms of its cause". But the clearest indications of all in the second reading speech are the statements that the motor accident scheme was never intended to be a comprehensive motor insurance scheme providing substantial damages in all cases of injuries connected in some way with the use of a motor vehicle, because, "[c]ommon sense and community expectations generally demand that the CTP policy provide coverage in respect of injuries which arise from crashes and collisions on the roads or from vehicles running out of control". That is to say far more than what the President in the Court of Appeal derived from it, that the speech conveyed only that the definition of injury was intended to be narrower than its predecessor.
The majority in the Court of Appeal did not consider the definition to be clear. That being so they were, by s 34 of the Interpretation Act 1987 (NSW) required to have regard, among other things, to the second reading speech. This in my opinion, they did not do. The Court of Appeal erred in this regard. They also erred in adhering to an approach to the construction of the definition which had been adopted in the past to different legislation by the courts, and which was the subject of explicit criticism in the second reading speech. The President of the Court of Appeal chose to substitute his own perception of moral responsibility for the statutory imposition of the burden of damages, and elected to decide the case according to his perception of who, in other factual situations might be better able to satisfy the judgment. Absent a clear statement to that effect in legislation, or relevant extrinsic materials in case of doubt, such a consideration cannot be relevant to the construction of legislation, and certainly not in a case such as this one where the legislature has done everything that it reasonably can to put its intention beyond doubt. It is not for any court to decide cases and construe enactments on the basis of who may have the longer pocket. The President acknowledged that the contest here was not between an impecunious defendant and a long-pocketed one because the contest was a contest by legislative mandate between two long pockets, each an insurer under a statutory scheme. But his Honour allowed the possibility that there might be a contest in another case between an impecunious defendant and an insurer of a motor vehicle, a long-pocketed party, to infect his approach to the proper construction of the definition, and that too was erroneous. The other member of the majority, Davies AJA, also approached the construction of the definition erroneously. His Honour said first, and to this extent, correctly, that the approach of the common law to issues of causation has been robust, some might say, on occasions far too robust. Statutes should not however be construed upon the basis of any predisposition towards robustness, particularly where, as here, the legislature sought to correct undue judicial robustness in the past.
The appeal should be allowed with costs. I would make the following orders:
1.Appeal allowed.
2.The first respondent (GSF Australia Pty Ltd - "GSF") pay the costs of the appellant (Allianz Australia Insurance Ltd - "Allianz").
3.Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 1 July 2003 and in their place order:
(a)the appeal to the Court of Appeal is allowed;
(b)GSF pay the costs of Allianz of the appeal to the Court of Appeal;
(c)Orders 1, 4 and 5 of the orders of the District Court of New South Wales made on 14 June 2002 are set aside and in their place order:
(i)judgment for the plaintiff against GSF in the sum of $450,000;
(ii) judgment for Allianz against GSF;
(iii) GSF pay the costs of Allianz in the District Court.