Allianz Australia Workers Compensation (NSW) Limited v NRMA Insurance Limited
[2008] ACTCA 10
•22 May 2008
ALLIANZ AUSTRALIA WORKERS COMPENSATION (NSW) LIMITED v NRMA INSURANCE LIMITED
[2008] ACTCA 10 (22 May 2008)
APPEAL – leave granted to rely upon a point not taken below
CONTRIBUTION – applicable principles
Held: in respect of injuries sustained in New South Wales by a worker unloading a trailer, insured under the prescribed form of compulsory third party insurance policy issued in the Australian Capital Territory, there was no co-ordinate or common liability entitling the relevant NSW workers compensation insurer to contribution.
Motor Traffic Act 1936 (ACT) ss 4(1), 51(1), 52(1), 53(1), 54, 66, 71 and 95
Motor Vehicle (Third Party Insurance) Regulations (ACT) Reg 4(1)
Workers Compensation Act 1987 (NSW) s 155
Motor Accidents Act (1988) NSW ss 3(1), 68A, 69 and 70
Elb v Nominal Defendant; Morgan Cars Pty Ltd (Third Party) (1972) 1 NSWLR 580
Suttor v. Gundowda Proprietary Limited (1950) 81 CLR 418
O’Brien v. Komesaroff (1982) 150 CLR 310
University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481
Coulton v. Holcombe (1986) 162 CLR 1
Whisprun Pty Ltd (formerly Northwest Exports Pty Ltd) v Dixon (2003) 200 ALR 447
Burke v. LFOT Pty Limited (2002) 209 CLR 282
Dering v Earl of Winchelsea (1787) 1 Cox 318 at 321; 29 ER 1184
Albion Insurance Company Limited v. Government Insurance Officeof New South Wales (1969) 121 CLR 342
Government Insurance Office of New South Wales v. R.J. Green & Lloyd Pty Limited (1966) 114 CLR 437
Fleming JG, The law of Torts, (9th ed, The Law Book Co.,1998)
ON APPEAL FROM A MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
No. ACTCA 6 - 2007
No. SC 80 of 2004
Judges: Higgins CJ, Refshauge and Graham JJ
Court of Appeal of the Australian Capital Territory
Date: 22 May 2008
IN THE SUPREME COURT OF THE ) No. ACTCA 6 - 2007
) No. SC 80 of 2004
AUSTRALIAN CAPITAL TERRITORY )
)
COURT OF APPEAL )
ON APPEAL FROM A MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
BETWEEN:ALLIANZ AUSTRALIA WORKERS COMPENSATION (NSW) LIMITED
Appellant
AND:NRMA INSURANCE LIMITED
Respondent
ORDER
Judges: Higgins CJ, Refshauge and Graham JJ
Date: 22 May 2008
Place: Canberra
THE COURT ORDERS THAT:
The appeal be dismissed.
The order made by the Master in respect of costs be set aside.
The respondent pay the appellant’s costs of the hearing before the Master.
The respondent pay two-thirds of the appellant’s costs of the appeal.
Otherwise, there be no order as to costs.
IN THE SUPREME COURT OF THE ) No. ACTCA 6 - 2007
) No. SC 80 of 2004
AUSTRALIAN CAPITAL TERRITORY )
)
COURT OF APPEAL )
ON APPEAL FROM A MASTER OF THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
BETWEEN:ALLIANZ AUSTRALIA WORKERS COMPENSATION (NSW) LIMITED
Appellant
AND:NRMA INSURANCE LIMITED
Respondent
Judges: Higgins CJ, Refshauge and Graham JJ
Date: 22 May 2008
Place: Canberra
REASONS FOR JUDGMENT
THE COURT:
On 12 September 1997 Noel Harris, an employee of Truform Pty Limited (‘Truform’), a company registered in the Australian Capital Territory, was injured while unloading a semi-trailer at Bungendore in the State of New South Wales.
Truform carried on business from a warehouse situated at Queanbeyan in the State of New South Wales where it manufactured metal products. The vehicle which Mr Harris was unloading comprised a prime mover, which had been manufactured in April 1980, and a trailer, which had apparently been purpose built for Truform in September 1993. The trailer apparently cost Truform $12,000. It purchased the prime mover on 3 January 1996 for $4,000.
Following its acquisition the primer mover, although owned by Truform, was registered, as from 21 January 1996, in the name of Peter John Abbey, who was and had been a director, secretary and shareholder of Truform since 1987.
The trailer, also owned by Truform, was also registered, as from 24 September 1993, in the name of Mr Abbey. Its registration expired on 23 September 2002.
Both the prime mover and the trailer were registered in Mr Abbey’s name with the Department of Urban Services in the Australian Capital Territory. When the prime mover was re-registered in about May 1997 and the trailer was re-registered in or about September 1996 the registration fees together with amounts representing third party insurance premiums were paid by cheques drawn on Truform’s bank account.
By legislation and administrative arrangement the monies received by way of third party insurance premium were remitted by the Motor Registry to the respondent, NRMA Insurance Limited, which was the sole authorised compulsory third party insurer for vehicles registered in the Australian Capital Territory at the time.
Apart from the third party insurance with the respondent to which reference has been made, Truform had cover with the appellant as its workers’ compensation insurer for any injury to any of its workers under a compulsory New South Wales policy obtained as required by s 155 of Workers Compensation Act 1987 (NSW).
The ultimate question for determination in these proceedings is whether the principles relating to dual insurance require a contribution to be made by the respondent to the amounts paid out by the appellant in respect of the injuries sustained by Mr Harris on 12 September 1997.
By an Ordinary Statement of Claim filed 8 September 1999 in the District Court of New South Wales Mr Harris sued Truform for negligence which was said to have caused him to suffer a prolapsed L4/5 disc and also sequelae. Mr Harris alleged that whilst he was unloading a pack of corrugated iron weighing approximately 850 kilograms from the back of the trailer he suffered a severe injury to his back. The particulars of negligence relied upon included:
(a) Failure to devise and maintain a safe system of work so that the Plaintiff was not exposed to unnecessary risk of injury.
(b) Failure to supply and ensure the use of safe and suitable plant an (sic) equipment so that the Plaintiff might carry out his work without being exposed to unnecessary risk of injury.
…
The District Court proceedings were apparently removed into the Supreme Court of New South Wales whereupon an Amended Statement of Claim was filed by the plaintiff on 27 November 2001 in that Court. Paragraph 3 of the Amended Statement of Claim was expressed as follows:
3. As a result of a negligently designed system of work the plaintiff was injured during the course of his employment from 19 May 1992 until 1 October 1997.
On 6 November 2001 the proceedings brought by Mr Harris against Truform were apparently settled. Inter alia, the settlement provided for a judgment to be entered for Mr Harris in the sum of $495,000.00, inclusive of costs and out of pocket expenses including Health Insurance Commission payback, for personal injuries but clear of Workers Compensation payments and treatment expenses to the date of settlement. The terms of settlement noted ‘the amendments to the Statement of Claim’, which, presumably, were those contained in the Amended Statement of Claim ultimately filed on 27 November 2001.
Following the settlement of the proceedings in the Supreme Court of New South Wales, the appellant, Allianz Australia Workers Compensation (NSW) Limited, brought the present proceedings against the respondent, NRMA Insurance Limited, claiming contribution in respect of the moneys paid by the appellant, as Truform’s workers’ compensation insurer, to Mr Harris following the settlement of Mr Harris’ proceedings against Truform.
The respondent has conceded that Truform was negligent in failing to provide a safe system of work as alleged by Mr Harris and further that Truform’s negligence arose out of the use of a motor vehicle. However, the respondent disputes its liability to make a contribution to the appellant.
The appellant’s claim for contribution was determined, at first instance, by the Master (Allianz Australia Workers Compensation (NSW) Ltd v NRMA Insurance Ltd [2007] ACTSC 2). Two matters were, relevantly, addressed. At [29] – [30] the learned Master rejected a submission that because the injury to Mr Harris occurred in New South Wales, his claim, insofar as it involved injuries caused by or arising out of the use of a motor vehicle, must be viewed by reference to the Motor Accidents Act (1988) NSW (the ‘Motor Accidents Act’). It had been submitted that the Motor Accidents Act precluded the Court from awarding Mr Harris damages for the injuries sustained by him as they did not arise out of the driving or operation of a motor vehicle or out of a defect in a motor vehicle (see the definition of ‘injury’ in s 3(1) of the Motor Accidents Act and ss 69-70 thereof).
The learned Master also rejected the appellant’s submission that for there to be dual liability Mr Harris would have had to frame his claim against Truform in a way that alleged negligence relating in some way to the motor vehicle rather than as an unsafe system of work claim. The Master was satisfied that the manner in which the claim by the injured person against the employer and vehicle owner was framed was quite immaterial to the issue of whether or not dual insurance applied. This finding was not challenged on the appeal.
The other issue decided by the Master concerned the question of whether there was a correspondence of identity between the insured under the workers’ compensation policy and the insured under the third-party policy. He found that there was no correspondence of identity, the insured under the workers’ compensation policy being Truform and the insured under the third-party policy being Mr Abbey. The Master considered that he had no alternative but to read the provisions of the Motor Traffic Act 1936 (ACT) (‘the Motor Traffic Act’) so that the word ‘owner’ meant what it was defined to mean in s 4(1). He relied upon what Jacobs JA, as his Honour then was, said in Elb v. Nominal Defendant; Morgan Cars Pty Ltd (Third Party) (1972) 1 NSWLR 580 (‘Elb’) at 585.
Dr and Mrs Elb had been injured in a road accident in Sydney as a result of a collision between their vehicle and one driven by a Mr Olofsson which had been hired by him in Brisbane from Morgan Cars Pty Limited. His vehicle had been registered in Queensland and was, in that State, the subject of a policy of insurance in respect of death or bodily injury to third parties caused by or arising out of the use of a motor vehicle not only in Queensland but also, inter alia, in New South Wales. Mr Olofsson had been killed in the accident. In the circumstances Dr and Mrs Elb sued the Nominal Defendant which, in turn, joined Morgan Cars Pty Limited as a third party claiming to recover the amount of any judgment against him and the amount of any costs under s 32 of the Motor Vehicles (Third Party Insurance) Act 1942 (NSW). Section 32 permitted recovery by the Nominal Defendant from a person who was the ‘owner of the motor vehicle’. Dr and Mrs Elb succeeded in their actions against the Nominal Defendant. In addition the trial judge found in favour of the Nominal Defendant in his cross-claims against Morgan Cars Pty Limited.
On the hearing of the appeal one of the issues which was canvassed was whether the trial judge had erred in holding that Morgan Cars Pty Limited was the person entitled to immediate possession of the motor vehicle and therefore the owner within the meaning, in that case, of s 5(b)(ii) of the Motor Vehicles (Third Party Insurance) Act 1942 (NSW). Section 5 of that Act contained a definition of ‘owner’ as follows:
‘Owner’ when used with reference to a motor vehicle means –
(a) in a case where a trader’s plate is affixed to the motor vehicle – the trader to whom such trader’s plate is in issue;
(b) in any other case –
(i) where the motor vehicle is registered – the person in whose name the motor vehicle is registered except where such person has sold or ceased to have possession of the motor vehicle within the meaning of section twenty-one of this Act;
(ii) where the motor vehicle is unregistered, or where the motor vehicle is registered but the person in whose name the motor vehicle is registered has sold or ceased to have possession of the motor vehicle within the meaning of section twenty-one of this Act – any person who solely or jointly or in common with any other person is entitled to the immediate possession of the motor vehicle.
Counsel for the Nominal Defendant urged the view that the word ‘owner’ in s 32 should be given its ordinary meaning and not its statutory meaning. Jacobs JA, with whose reasons Holmes JA agreed, found that the context and subject matter of s 32 did not indicate or require a meaning to be given to the word ‘owner’ different from that stated in s 5 of the Motor Vehicles (Third Party Insurance) Act 1942 (NSW).
In relation to the facts in this case, the Master was satisfied that both the prime mover and the trailer were, at all times, assets of Truform, and that their registration fees and third-party insurance premiums had been paid by Truform. He also found that the registration of the prime mover and the trailer in Mr Abbey’s name had been purely as a matter of administrative convenience. One might observe that s 95 of the Motor Traffic Act contemplated registration being effected in the name of the secretary or manager of a company. Section 95 provided as follows:
95 Registration of a motor vehicle or trailer on behalf of a co-partnership or company may be applied for by, or granted to, any partner of the co-partnership, or the secretary or manager of the company, as the case may be.
The learned Master considered that the compulsory third-party policies did not relevantly insure Truform. He did not consider that s 95 would lead to a different conclusion.
The Master ultimately concluded that the claim for contribution must fail on the basis that under the relevant workers’ compensation policy the insured was Truform whereas under the third-party policies it was Mr Abbey.
On the hearing of the appeal the appellant argued that the cover provided by the compulsory third party policies extended to include Truform so that there was a correspondence between the identity of the insured under the compulsory workers’ compensation policy and also the compulsory third-party policies.
The issue raised by the Notice of Appeal was whether or not the learned Master erred in failing to find that Truform was entitled to indemnity under the third-party policies from the respondent.
The respondent’s Notice of Contention raised two matters the second of which was abandoned on the day before the hearing of the appeal. The matter which remained was whether the third party policies covered the same risk as the workers’ compensation policy given the limitations on liability of a company such as Truform in respect of injuries sustained by Mr Harris under the terms of the Motor Accidents Act.
A new point of contention
A further matter which the respondent sought to ventilate on the hearing of the appeal was one which had not been raised before the learned Master. It concerned the application of the proviso contained in the form of compulsory third party policy under s 54 of the Motor Traffic Act as prescribed by regulation 4(1) of the Motor Vehicle (Third Party Insurance) Regulations made under the Motor Traffic Act (then the Motor Traffic Ordinance 1936).
In the course of the hearing of the appeal, leave was granted to the respondent to amend its Notice of Contention so as to allow the additional point 3, as set out in the ‘RESPONDENT’S AMENDED WRITTEN SUBMISSIONS’ dated 20 February 2008, to be raised, it having been conceded by senior counsel for the appellant that the point sought to be raised for the first time upon the hearing of the appeal could not possibly have been met by calling further evidence below.
An Amended Notice of Contention incorporating the additional point 3 (with a minor typographical error) had been filed on 19 February 2008.
Given that the point was one of construction, the Court found it expedient and in the interests of justice to entertain the point (see Suttor v. Gundowda Proprietary Limited (1950) 81 CLR 418 at 438; O’Brien v. Komesaroff (1982) 150 CLR 310 at 319; University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483; Coulton v. Holcombe (1986) 162 CLR 1 at 6-9 and Whisprun Pty Ltd (formerly Northwest Exports Pty Ltd) v Dixon (2003) 200 ALR 447 at [51]).
This was not a case where allowing the additional point to be taken on the appeal would have costs consequences for the appellant which would not be capable of being addressed by an appropriate order as to costs. Furthermore, it was not a case where worry, inconvenience and interference with personal and business affairs could have been a relevant consideration.
Quantum
It is now agreed between the parties that if the respondent is liable to make a contribution then the amount of the contribution should equal one half of the amount paid by the appellant pursuant to the Supreme Court judgment ($495,000) and also the payments previously made by the appellant to Mr Harris by way of workers’ compensation payments, totalling $66,993.08, and treatment expenses. The parties do not ask the Court to determine the precise amount, if any, that should be paid, acknowledging that, absent an agreement between them, the question of amount could be remitted to the Master for determination.
Did the compulsory third-party policies provide cover which extended to include Truform as the legal owner?
The respondent argued that its liability to provide cover in respect of the relevant vehicle/s was a liability owed to Mr Abbey as the person named in the certificate/s of registration as the owner of the motor vehicle/s. For this argument to succeed s 71(1) of the Motor Traffic Act must be construed in such a way as to give a limited meaning to the word ‘owner’, confining it to one or other of the categories (a)-(f) as set out in the definition of ‘owner’ in s 4(1) of that Act.
Section 4(1) relevantly provided:
4(1) In this Act, unless the contrary intention appears—
…
“owner”, in relation to a motor vehicle means –
(a) in the case of a motor vehicle that is registered under this Act—the person whose name is specified in the certificate of registration as the owner of the motor vehicle;
(b) in the case of a visiting motor vehicle—the person whose name is specified in the certificate of registration as the owner of that vehicle under the law of the State, or of the Northern Territory, in which the vehicle is registered;
(c) in the case of a motor vehicle to which trader’s plates are affixed—the trader to whom the trader’s licence in relation to those plates has been granted under this Act;
(d) in the case of a motor vehicle or visiting motor vehicle the owner of which has died—the legal personal representative of the deceased owner whilst he or she is acting as the legal personal representative;
(e) in the case of a visiting motor omnibus—the person to whom a licence to use the visiting motor omnibus as a motor omnibus in the Territory has been granted; and
(f) in the case of an unregistered motor vehicle—a person who, solely or jointly with any other person, is entitled to immediate possession of it;
The expressions ‘former owner’ and ‘new owner’ were also defined in s 4(1) as follows:
4(1) In this Act, unless the contrary intention appears—
…
“former owner”, in relation to a motor vehicle which is sold or disposed of, means the owner who sold or disposed of the vehicle;
…
“new owner”, in relation to a motor vehicle which is sold or disposed of, means the person to whom the vehicle is sold or disposed of;
Section 51(1) of the Motor Traffic Act made it an offence for a person to use a motor vehicle on a public street unless there was in force in relation to the use of the vehicle a third-party policy i.e. a policy which complied with the requirements of Part 5 of the Motor Traffic Act.
Section 52(1) provided that the Registrar of Motor Vehicles should not grant or renew the registration of a motor vehicle unless and until there was lodged with him or her a certificate in accordance with the prescribed form issued by an authorised insurer that a third-party policy expressed to commence either upon the date of issue of the certificate or upon a date not later than the date of commencement of the registration or renewal of registration and to terminate upon the date of expiration of such registration or renewal would be issued by that authorised insurer in relation to the use of the motor vehicle.
Section 53(1) of the Motor Traffic Act required an authorised insurer who accepted the appropriate amount of insurance premium in respect of the insurance of a motor vehicle to issue to the owner of the motor vehicle a certificate of the nature referred in s 52(1) in relation to the vehicle.
In relation to policies of insurance s 54 relevantly provided:
54.(1) In order to comply with the requirements of this Part, a third-party policy—
(a) shall be issued by an authorized insurer;
(b) shall, where the policy is issued in relation to the use of a particular motor vehicle, insure the owner of the motor vehicle mentioned in the policy and any other person who at any time drives the motor vehicle, whether with or without the authority of the owner, jointly and each of them severally, against all liability incurred by that owner and that person jointly, or by either of them severally, in respect of the death of, or bodily injury to, any person caused by or arising out of the use of the motor vehicle in any part of the Commonwealth;
(c) shall, where the policy is issued in relation to the use of motor vehicles to which a trader’s plate is affixed, insure the trader to whom the trader’s plate mentioned in the policy is in issue and any other person who at any time drives a motor vehicle to which that trader’s plate is affixed (whether the vehicle is so driven or the trader’s plate is so affixed with or without the authority of the trader) jointly, and each of them severally, against all liability incurred by that trader and that person jointly, or by either of them severally, in respect of the death of, or bodily injury to, any person caused by or arising out of the use of the motor vehicle to which the trader’s plate is so affixed, in any part of the Commonwealth; and
(d) shall be in accordance with the prescribed form.
(2) A third-party policy shall not extend to insure the owner or driver of the motor vehicle against—
(a) any liability to pay compensation under the Workers’ Compensation Act 1951 to a worker employed by him or her; or
(b) any liability which may be incurred by him or her under an agreement unless the liability is one which would have arisen in the absence of that agreement.
(3) A third-party policy which complies with the requirements of paragraphs (a) and (b) or (c) of subsection (1) shall not be invalidated by reason of the fact that it contains any term, condition or warranty not contained in the prescribed form, but any such term, condition or warranty shall be void and of no effect.
…
(8) Notwithstanding anything in any enactment other that (sic) this Act or any rule of law, an authorized insurer issuing a third-party policy shall, in respect of any liability in respect of the death of, or bodily injury to, any person which the third-party policy purports to cover in the case of the owner of the insured motor vehicle or any other person, be liable to indemnify that owner or person.
…
The relevant form of third party policy (Form A) prescribed by Regulation 4 of the Motor Vehicle (Third Party Insurance) Regulations in accordance with s 54(1)(d) of the Motor Traffic Act (see also s 54(3) which authorised, albeit indirectly, the inclusion of terms, conditions and warranties in the prescribed form) was, relevantly as follows:
FORM A Regulation 4
AUSTRALIAN CAPITAL TERRITORY
…
THIRD PARTY POLICY
Name and address of authorized insurer.
Policy No.
1. Description of motor vehicle—
…
2. Name and address of owner—
3. Period of insurance—To commence on and to terminate at midnight on the date of expiration of the registration of the motor vehicle (being a date not later than ).
4. Amount of premium paid for issue of policy—
5. Limitation as to use. …
Whereas the owner has made application and paid a premium for the issue by the abovenamed insurer of a third party policy for the purposes of the Motor Traffic Act 1936, in relation to the motor vehicle:
The insurer hereby agrees that during the period commencing and terminating as shown above, and during any period for which the insurer may renew this policy, the insurer shall insure the owner and any other person who at any time drives the motor vehicle, whether with or without the authority of the owner, jointly and each of them severally, against all liability (except a liability referred to in subsection (2) of Section 54 of the Act) incurred by the owner and that person jointly, or by either of them severally, in respect of the death of or bodily injury to any person caused by or arising out of the use of the motor vehicle in any part of the Commonwealth of Australia: Provided that, where liability is incurred in a part of the Commonwealth other than the Australian Capital Territory, this policy shall indemnify the owner and that other person, as the case may be, only to the extent (if any) to which he or she is not insured against the liability pursuant to a law in force in that part of the Commonwealth requiring the insurance to be effected.
For [insert name of insurer]
Signature.
…
Other sections in the Motor Traffic Act where the word ‘owner’ is used and which are germane to the identification of the insured in the compulsory third party insurance policy required by s 54 of the Motor Traffic Act include s 66, s 71 and s 95, which has been quoted above. Section 95 is to be found in Part 6 of the Act which bears the heading ‘General Provisions Relating to Motor Vehicles’. Sections 66 and 71 are to be found in Part 5 of the Act which is headed ‘Insurance’ and includes ss 49-93.
Sections 66 and 71 relevantly provide as follows:
66(1)For the purposes of any proceedings against the owner of a motor vehicle, whether severally or jointly with the driver of the motor vehicle, for the recovery of damages in respect of the death of, or bodily injury to, any person caused by or arising out of the use of the motor vehicle, and, where the motor vehicle is an insured motor vehicle, for the purposes of the third-party policy, any person (other than the owner) who was, at the time of the occurrence out of which the proceedings arose, the driver of the motor vehicle (whether with or without the authority of the owner) shall be deemed to be the agent of the owner acting within the scope of his or her authority in relation to the motor vehicle:
…
71(1)Every third-party policy in relation to a motor vehicle shall enure in favour of the owner for the time being and the driver, notwithstanding any change in the ownership of the motor vehicle, but shall cease to have effect when another third-party policy in relation to that motor vehicle comes into force except in relation to any liability, whether under the policy or under this Act, accrued or incurred before that other third-party policy came into force.
(2)As soon as practicable after the owner of an insured motor vehicle sells or ceases to have possession of the motor vehicle—
(a) he or she shall give notice of that fact to the authorized insurer who issued the third-party policy; and
(b) the person who has purchased or acquired possession of the insured motor vehicle shall give notice of that fact to the authorized insurer.
…’
The statutory requirement for third party insurance policies to be issued under the Motor Traffic Act is clearly directed at ensuring that where a person is injured and his or her injuries are caused by or arise out of the use of a motor vehicle then cover will be available to meet any relevant liability that may have been incurred by the owner or the driver, whether driving with or without the authority of the owner, in respect of such injuries. The deemed agency for which s 66(1) provides is clearly directed at ensuring that an owner’s policy will respond even when injuries are caused by a driver who drives the relevant motor vehicle without the authority of the owner.
Section 71 recognises that within a given period of insurance, an owner may ‘sell’ or ‘cease to have possession’ of ‘an insured motor vehicle’.
Plainly, a person in whose name a vehicle is registered, such as a company secretary or company manager who secures registration in his or her name in accordance with s 95 of the Motor Traffic Act, may have no authority to sell the insured motor vehicle and an inability to cease to have possession of such a motor vehicle within the meaning of s 71(2) of the Motor Traffic Act.
Does it follow that if a legal owner, who is not the registered owner, sells or ceases to have possession of his insured motor vehicle then neither the legal owner nor the registered owner would be under an obligation to give notice of the sale or parting with possession to the authorised insurer?
If the ‘owner’ in s 71(2) means no more than, relevantly, the registered owner within the meaning of the statutory definition of owner in s 4(1) of the Act, then this would seem to follow – a somewhat unlikely result.
It seems to us that ‘owner’ in s 71(2) should be construed to mean the legal owner who has power to sell or part with possession of the insured motor vehicle whether a registered owner or not. In this regard, it is helpful to have regard to the definitions of ‘former owner’ and ‘new owner’ as well (see [30] above).
Once such a conclusion is reached, logic dictates that the ‘owner’ for whose benefit a third party policy in relation to a motor vehicle enures, within the meaning of s 71(1) would include not only a registered owner for the time being but also a legal owner, if other than the registered owner.
Even before notice of a sale or acquisition of possession of an insured motor vehicle has been given to the relevant authorised insurer, the new owner would clearly be covered by the policy in relation to the motor vehicle. It would be illogical and inconsistent with the plain purpose and intendment of the Act for the new owner to be covered but not a former owner of an insured motor vehicle unless the former owner happened to also be the registered owner.
As Professor Fleming pointed out in The Law of Torts (9th ed, The Law Book Co., 1998) at 429:
According to conventional theory, an owner [and by that we understand Professor Fleming to mean a legal owner and not simply a registered owner with statutory liabilities] may incur liability for an accident caused by someone else negligently driving his car in one of two possible ways: vicariously, if the driver was his servant or agent (for example a chauffeur) or personally when remiss in such respect as entrusting the car to someone of questionable competence. …
In our opinion s 71 of the Motor Traffic Act effectively extends the range of persons covered by a compulsory third-party policy under s 54 of the Motor Traffic Act to include legal owners such as Truform in the present case, who are not also the registered owners.
In the present case, the policies will not be limited to the provision of cover for, presumably, Mr Abbey as the person whose name and address is stated in the policies, nor will they be limited to providing cover to Mr Abbey as the registered owner. Rather, the policies provide cover for Truform as the legal owner of the prime mover and trailer at the time of Mr Harris’ accident as well.
Given the extended operation of compulsory third-party insurance policies under the Motor Traffic Act, brought about by s 71, the respondent could, subject to what we say below, be liable to make a contribution in respect of the monies paid by the appellant by way of indemnity under Truform’s New South Wales compulsory workers’ compensation policy.
Contribution
The principles regarding contribution are conveniently summarised in the judgments of the High Court in Burke v LFOT Pty Limited (2002) 209 CLR 282 (‘LFOT’). The doctrine is bottomed and fixed on general principles of justice. The reason for contribution is that ‘in equali jure the law requires equality; one shall not bear the burthen in ease of the rest, and the law is grounded in great equity’ (per Lord Chief Baron Eyre in Dering v Earl of Winchelsea (1787) 1 Cox 318 at 321; 29 ER 1184 at 1185).
In LFOT, Gaudron A-CJ and Hayne J said at [14]-[16] and [22]:
Equitable contribution
[14] In general terms, the principle of equitable contribution requires that those who are jointly or severally liable in respect of the same loss or damage should contribute to the compensation payable in respect of that loss or damage, either equally where they are liable in the same amount or proportionately, where the amount of their liability differs. The principle has regularly been applied between co-sureties, co-insurers, partners, co-owners, where payment is made by one in discharge of a common liability, and co-trustees who are in pari delicto - FN;FFN.50#FN;FFN.50.
[15] The doctrine of equitable contribution applies both at common law and in equity. It is usually expressed in terms requiring contribution between parties who share “co-ordinate liabilities” or a “common obligation” to “make good the one loss”. More recently, in BP Petroleum Development Ltd v Esso Petroleum Co Ltd, the right to contribution was said to depend on whether the liability was “of the same nature and to the same extent”.
[16] The notion of “co-ordinate liability” is one that depends on common interest and common burden. Perhaps because, at common law, there was no general right of contribution between tort-feasors, the notion of “co-ordinate liability” has not traditionally been expressed in terms requiring equal or comparable culpability or a requirement that the acts or omissions of the persons in question be of equal or comparable causal significance to the loss in respect of which contribution is sought. However, the requirement that liability be “of the same nature and to the same extent”, as stated in BP Petroleum, is apt to include notions of equal or comparable culpability and equal or comparable causal significance.
…
[22] It is unnecessary in this case to further explore the relevance of culpability and the causal significance of the acts and omissions of persons claiming equitable contribution. Similarly, it is unnecessary in this case to further explore how doctrines of equitable contribution operate in connection with particular provisions of Pt VI of the Act [referring to the Trade Practices Act 1974 (Cth)]. That is because the doctrine of equitable contribution is founded on concepts of fairness and justice – “natural justice”, as that term was explained by Kitto J in Albion Insurance Co Ltd v Government Insurance Office (NSW). In this context, “natural justice” requires that if “one of several persons has paid more than his proper share towards discharging a common obligation” he is entitled to be recompensed by those who have not. …
(Footnotes omitted)
Albion Insurance Company Limited v Government Insurance Office of New South Wales (1969) 121 CLR 342 is one of the leading authorities on the application of the principle of equitable contribution between co-insurers referred to by Gaudron A-CJ and Hayne J at [14].
In LFOT McHugh J said at [38]:
Principles of contribution
[38] Both common law and equity give a person the right to obtain contribution to a payment made by that person in discharging “a common obligation” that is owed by that person and others. In determining whether there is “a common obligation”, the traditional test is whether the liability of each party “is of the same nature and to the same extent”. …
(Footnotes Omitted)
See also per Kirby J in LFOT at [87]-[96] and Callinan J at [141]-[142].
Motor Accidents Act 1988 (NSW)
The second matter ventilated on the hearing of the appeal was concerned with the effect of the Motor Accidents Act 1988 (NSW). The objects of Part 6 of that Act was stated in s 68A to be:
(a) to control the amount of damages that may be awarded to a claimant …, 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.
In that context s 69(1) provided that Part 6 applied to and in respect of an award of damages which related 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. The definition of the word ‘injury’ in s 3(1) of the Motor Accidents Act was such as to confine what was meant by ‘injury’ to 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 was the result of and caused during the driving of the vehicle, a collision, the vehicle running out of control or such use or operation by a defect in the vehicle.
It was said that the Motor Accidents Act did not permit the recovery of damages for the injuries sustained by Mr Harris in unloading the trailer because the vehicle was stationary at the time and the injury was not occasioned by a defect in the trailer.
The negligence and liability of Truform in failing to provide a safe system of work for Mr Harris has been conceded by the respondent. In the circumstances the respondent’s policies would respond as the bodily injuries suffered by Mr Harris arose out of the use of the prime mover and trailer (see Government Insurance Office of New South Wales v. R.J. Green & Lloyd Pty Limited (1966) 114 CLR 437 at 446-7).
The Motor Accidents Act does not take away from the respondent its common obligation to make good the one loss. The workers’ compensation insurer and the compulsory third party insurer shared co-ordinate liabilities.
We agree with the observations of the Master in relation to this matter at [28]-[30].
The terms of the statutory third party policies
The final point, being the point that was not argued below, is both significant and straight forward.
The proviso contained in the prescribed form of compulsory third party insurance policy is directed at ensuring that the compulsory third party insurance policy will not provide cover to which another compulsory policy would respond. It is clear from the wording of the proviso that the cover provided by the appellant under its New South Wales statutory workers’ compensation policy would answer the description of one to which the proviso applied.
The proviso should be construed in a manner which is consistent with the legislative policy as revealed in s 54(2)(a) of the Motor Traffic Act. Section 54(2)(a) supports a construction of the proviso which ensures that an ACT compulsory third party insurance policy will not provide cover where another compulsory policy, whether a compulsory third party insurance policy or a compulsory workers’ compensation policy, would respond.
In the circumstances, there was no co-ordinate or common liability on which the principle of contribution could operate.
It follows that the appeal should be dismissed.
Notwithstanding the success of the appellant on the points raised by the Notice of Appeal and the original Notice of Contention, it has failed in its attempt to secure an order for contribution by the respondent on the point raised by way of amendment to the Notice of Contention, which the Court has, in its discretion, allowed the respondent to raise and rely upon, notwithstanding that it was not taken below.
In the circumstances, the respondent should not have the benefit of orders in respect of costs to which it may have been entitled in other circumstances
The order made by the Master in respect of costs should be set aside. The appropriate order as to costs would be one where the appellant’s costs of the hearing before the Master and two-third’s of the appellant’s costs of the appeal should be paid by the respondent. Otherwise there should be no order as to costs.
I certify that the preceding seventy (70) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.
Associate:
Date: 22 May 2008
Counsel for the Appellant: R W Seton SC and G A Stretton
Solicitor for the Appellant: Hicksons Lawyers
Counsel for the Respondent: S G Campbell SC and M A McDonogh
Solicitor for the Respondent: Moray & Agnew
Date of hearing: 21 February 2008
Date of judgment: 22 May 2008
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