Gesler and Gesler v FAI General Insurance Co Ltd

[1995] QCA 318

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND	Appeal No. 84 of 1994
Brisbane
[Gesler v. FAI]
BETWEEN:

KEVIN GESLER

(First Plaintiff)

AND:

NANCY FAY GESLER

(Second Plaintiff)

AND:

WILLIAM REA

(First Defendant)

Appellant

AND:

CAPRICORNIA ELECTRICITY

(Second Defendant)

AND:

FAI GENERAL INSURANCE COMPANY LIMITED

(Third Party)

Respondent

McPherson J.A.
Moynihan J.

Ambrose J.

Judgment delivered 25/07/1995

Separate concurring reasons by each member of the Court.

APPEAL DISMISSED WITH COSTS

CATCHWORDS:	TORT - personal injury - electric shock - whether Appellant as occupier entitled to indemnity under insurance policy - Section 3(1) Motor Vehicles Insurance Act 1936 - legal liability of Appellant sourced in his character as occupier of land not by reason of his relationship to or with the motor vehicle.
Counsel:	Mr R B Dickson for the Appellant Mr J A Griffin QC for the Respondent
Solicitors:	Gadens Ridgeway for the Appellant Clayton Utz for the Respondent
Hearing date:	5 May 1995
IN THE COURT OF APPEAL	[1995] QCA 318
SUPREME COURT OF QUEENSLAND

Appeal No. 84 of 1994

Brisbane

Before McPherson J.A.

Moynihan J. Ambrose J.

[Gesler v. FAI]

BETWEEN

KEVIN GESLER

(First Plaintiff)

AND

NANCY FAY GESLER

(Second Plaintiff)

AND

WILLIAM REA

(First Defendant) Appellant

AND

CAPRICORNIA ELECTRICITY BOARD

(Second Defendant)

AND

FAI GENERAL INSURANCE COMPANY

Respondent

REASONS FOR JUDGMENT - McPHERSON J.A.

Judgment delivered the 25th day of July 1995

The plaintiff was injured on 22 April 1987 when he sustained an electrical shock while unloading cattle feed from a truck into a bin on a feed lot on land owned by the first defendant Mr Rea. He was standing on the roof of the truck when a metal rod he was holding touched overhead

powerlines belonging to the second defendant Capricornia Electricity Board.

The cattle feed was transferred from the top of the truck by way of a boom attached to and

capable of swivelling out at right angles from the truck. To the untutored eye, the boom looks like a

tube through which the feed is passed and dropped into the bin. The feed material contained

molasses, which tended to make it stick or bridge, and it was necessary to loosen it up from time to

time in order to set it flowing freely again. The method used was to stand on the roof of the truck,

where there was a walkway, and poke a rod into the feed in order to stir or prod it. It was while he

was doing this that the plaintiff allowed the rod to touch the overhead electric powerlines.

The learned judge apportioned the agreed damages among various parties to the action. He

reduced the damages by 25% to allow for the plaintiff's own share of the blame. He apportioned

50% to Mr Rea as the occupier of the land; and 25% to the Board, for its part in locating and

leaving the powerlines where they were despite its knowledge of a prior incident which had

demonstrated the risk of injury to a person working in the position of the plaintiff.

None of this was disputed on appeal. The matter comes to this Court now because the

truck, which was owned by Supastock Feeds who contracted with the plaintiff and his wife to drive

it, was insured by the third party FAI General Insurance Company Limited under a policy of

insurance issued in accordance with s.3(1) of the Motor Vehicles Insurance Act 1936. Mr Rea

claims to be entitled to the benefit of the policy as obliging FAI to indemnify him against the share of

the plaintiff's damages awarded against him. The learned trial judge held it was not available to him.

On appeal, therefore, the issue between Rea and FAI is whether Rea is entitled to indemnity

under the motor vehicle policy. Its resolution depends on the interpretation of s.3(1) of the Act, or

its applicability to the particular circumstances of this case. Section 3(1) requires the owner of a

motor vehicle to insure:

"... against all sums for which he ... or any other person ... shall become legally liable by way of damages in respect of such motor vehicle for accidental bodily injury ... where such injury is caused by, through, or in connection with such motor vehicles".

The broad purpose of the provision is, of course, to ensure that there is some reliable source from

which a person tortiously injured by a motor vehicle can expect to be paid any damages awarded;

and correspondingly that the owner of the motor vehicle is not financially ruined by having to pay

damages in an amount which may be very large. Because the language of the statutory provision is

the boundary between obtaining satisfaction of a judgment for damages or possibly nothing at all,

and also marks off the liabilities of different insurers of distinct risks involved in the same event, it has

naturally proved to be fertile ground for litigation.

The words of s.3(1) are extremely wide. They speak of injury "caused by, through, or in

connection with" a motor vehicle. They do not, as in New South Wales, incorporate the expression

"the use of" a motor vehicle, which has been held to serve as a limiting factor: see McEwan v. Gold

Coast City Council [1987] 1 Qd.R. 337, 346-347. Hence, in Fire & All-Risks Insurance Co. v.

Turner (1976) 50 A.L.J.R. 767, a passenger injured by glass splinters from a car windscreen

shattered by a bullet accidentally discharged from a rifle carried by someone getting out of the car

was held to have suffered injury caused by, through, or in connection with a motor vehicle. So also

a person on whom an insured vehicle fell while it was being repaired: McEwan v. Gold Coast

Council [1987] 1 Qd.R. 337; or, in Tonga v. John Holland Construction Pty. Ltd. [1988] 2

Qd.R. 587, a crane which was being used to lift the insured vehicle. The function of a vehicle is to

serve as a conveyance for passengers and goods: Wilson v. Austral Motors (Qld.) Pty. Ltd.

[1983] 2 Qd.R. 774, 779-780. Consequently an injury sustained in loading or unloading goods to

or from a vehicle, may be within the scope of s.3(1) and the indemnity afforded by it: Early v.

Kilcoy Pastoral Company Pty. Ltd. [1970] Qd.R. 99; Wilson v. Austral Motors (Qld.) Pty.

Ltd., [1983] 2 Qd.R. 774; Glover v. Politanski [1990] 2 Qd.R. 41; although not where the

source of the injury is a defect in separate equipment used in the process of loading: Coster v. Boral

Gas (Qld.) Pty. [1986] 1 Qd.R. 393.

Some of these decisions travel close to the borderline, and were decided before the High

Court in Technical Products Pty. Ltd. v. State Government Insurance Office (1989) 167

C.L.R. 45, 47-48, 52, adopted the test suggested in Tonga v. John Holland (Constructions) Pty.

Ltd. [1988] 2 Qd.R. 587, 588-589, which is that there must be a relationship between the motor

vehicle and the very act or omission giving rise to the liability identified in s.3(1). The critical

expression in the provision is "legally liable ... in respect of such motor vehicle". It is, as the decision

of the High Court in that case shows, not enough to demonstrate only a connection or relationship

between the injury and a motor vehicle.

The test adopted in Technical Products is capable of being traced to two decisions, which

their Honours approved, of the Queensland Full Court, in which the liability was held not to answer

the description in s.3(1). One was Stevens v. Nudd [1978] Qd.R. 96, in which the liability if any

(and there was held to be none) arose out of failure to control a dog on the footpath that ran out and

collided with the plaintiff's motor cycle on the road. In Boath v. Central Queensland Meat Export

Co. Pty. Ltd. [1986] 1 Qd.R. 139, the plaintiff was driving his truck over a bridge on the

defendant's property when the bridge collapsed and he sustained personal injuries. The tortious act

or omission in that case was characterised essentially as one arising from liability as an occupier, and

held not to be one for which the defendant was "legally liable ... in respect of a motor vehicle".

It is doubtful whether there are now any special duties attaching to occupiers apart from the

general duty to take reasonable care: Australian Safeway Stores Proprietary Limited v. Zaluzna

(1987) 162 C.L.R. 479. That general duty nevertheless has its source in the responsibility imposed

by law on a landowner or someone in control of property of taking reasonable care that others are

not harmed by potentially injurious activities conducted or conditions permitted to prevail there: cf.

Wilkinson v. Joyceman [1985] 1 Qd.R. 567; cf. also R. v. Shorrock [1994] Q.B. 279.

In the present case the legal liability of the first defendant Rea for the plaintiff's personal

injury was closely associated with the truck or motor vehicle on which the plaintiff was standing to

unload it when he touched the overhead powerlines with the metal rod he was using. To that extent

there was a discernible and rational link between the two; but Rea's legal liability for the plaintiff's

injury arose from his act of selecting, as the location for the bin into which the cattle feed was to be

offloaded, a place that was potentially dangerous because of the presence of overhead powerlines.

The choice of that place was made in the exercise of his powers of ownership and control over the

land on which the offloading activity was carried out. That being so, it does not seem accurate to

describe him as one who is "legally liable by way of damages in respect of [a] motor vehicle for

accidental bodily injury ...". The legal liability was fixed on him in his character as owner or occupier

of land and not by reason of his relationship to or with the motor vehicle itself.

The case is no doubt another instance which is close to the margin; but, from the standpoint

of the first defendant, it is, I think, on the wrong side of it: cf. Stradbroke Sandblasting Pty. Ltd. v.

Walsh (C.A. 48 of 1993; August 5, 1993). His Honour was therefore correct in deciding as he did

that the first defendant was not entitled to the benefit of the indemnity conferred by the compulsory

motor vehicle policy issued by the third party FAI to the owner of the truck.

The appeal should be dismissed with costs.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 84 of 1994

Brisbane

Before McPherson J.A.

Moynihan J. Ambrose J.

[Gesler v. FAI]

BETWEEN:

KEVIN GESLER

(First Plaintiff)

AND:

NANCY FAY GESLER

(Second Plaintiff)

AND:

WILLIAM REA

(First Defendant)

Appellant

AND:

CAPRICORNIA ELECTRICITY

(Second Defendant)

AND:

FAI GENERAL INSURANCE COMPANY LIMITED

(Third Party)

Respondent

REASONS FOR JUDGMENT - MOYNIHAN J

Judgment delivered the 25th day of July 1995

The appellant (Rea - the first defendant below) was the occupier of a feed lot to which the first

plaintiff below (Kevin Gesler) carted stock feed in bins mounted on a truck owned by himself and

his wife (the second plaintiff). The motor vehicle was registered and insured under the Motor
Vehicles Insurance Act 1936 by the respondent (the third party - FAI Insurance Co Limited).

The bulk bin in which the feed was carried was divided into six separate hoppers. It was

necessary to transfer the feed from the hoppers to a bin in which the appellant directed it be placed,

he having previously positioned the bin. The feed, which was mixed with molasses, was transferred

from the hoppers to the bin via a boom with an internal auger. It was known that the feed had a

tendency to "bridge" during such an operation, the consequence of this was that it did not flow freely

and a length of metal pipe was used to free it up when bridging occurred. Gesler was standing on

top of the bin mounted on the truck and was so engaged when he sustained an electric shock as a

result of the metal pipe he was using coming into contact with the overhead power lines which were

the responsibility of the second defendant (the Capricornia Electricity Board). On the basis that

Gesler could not unload the bin without parking his vehicle where he did, the learned trial Judge

apportioned 50 per cent of liability for Gesler's injuries to the appellant on the basis that he was the

occupier of the land on which the bin was placed. The Judge found contributory negligence against

the plaintiff Gesler which he determined to be 25 per cent and he found that the Electricity Board

was at fault for failing to raise the power line after an earlier incident of which it was aware and he

apportioned its liability at 25 per cent.

The appellant claimed an indemnity from the respondent on the footing that his legal liability

to Gesler was one which arose "by through or in connection with" the motor vehicle on which the

bulk feed bin was mounted and was "in respect of" that vehicle in terms of s.3(1) of the Motor

Vehicles Insurance Act 1936. The learned trial Judge refused to order the respondent to indemnify

the appellant on the basis that his liability was not "in respect of" the motor vehicle. The appellant

appeals against that decision. It is accepted that the occurrence was "by, through or in connection

with" the motor vehicle.

Section 3(1) is much considered. It was determined in Technical Products Pty Ltd v. State

Government Insurance Office (Queensland) (1988) 167 CLR 45 that the "in respect of" provision of the subsection focuses on the relationship between the injury and the vehicle and that there must be

"some discernible and rational link between the basis of legal liability and the particular motor

vehicle" Technical Products at p.47. It was observed (at p.48) that the requirement could not

ordinarily be satisfied where the liability in question was that of a person who is unconnected with

the vehicle. The High Court in Technical Products upheld and proved the Full Court decision in that

case which concluded that there had to be more than the "mere presence of the trailer" (the vehicle

in issue in that case) to establish the required relationship. The Full Court in Technical Products

spoke of the necessity of a relationship between the vehicle and "the very act or omission which

gives rise to" the liability in respect of which the indemnity provided for by the subsection is sought;

(1988) 5 A.N.Z. Insurance Cases 75,436.

The High Court in Technical Products concluded that a failure to provide a safe system of

work in relation to the use of a fork lift loading bags into a container attached to a stationary trailer

was not liability "with respect to" the trailer. In other words the essential discernible and rational link

between the employer's liability and the trailer was lacking. In the words of Dawson J. (at p.51)

there was "a merely coincidental or extraneous connection". Technical Products may be contrasted

with Glover -v- Politanski (1990) 2 Qd.R. 44. It was concluded in that case that an employer's

failure to provide a safe system of work encompassed the risk involved in the actual act of loading

onto the vehicle as distinct from the risk involved in handling the bags in issue in that case. That was

held sufficient to make the liability one with respect of the vehicle. In Boath v. The Central

Queensland Meat Export Co Pty Ltd and State Government Insurance Office (Queensland) (1986)

1 Q.R. 130 the collapse of a bridge while a vehicle was driving across it was held to have had

insufficient connection with the vehicle to satisfy the "in connection with" requirements. This was on

the basis that the case was a "straight forward example of a breach of duty on the part of an

occupier". There are a number of other cases, to which reference is made in the cases already cited

where it was concluded that particular circumstance fell on one side or other of the mine constituted by the "in respect of" test. It is unnecessary to canvas them since the principle is fairly clearly

established by the High Court in Technical Products and the decisions which it approves.

The trial Judge correctly concluded that the appellant's liability was not in respect of the

motor vehicle. The appellant's was in respect of his breach of duty as the occupier of the land on

which the bin was placed in a dangerous position because of its proximity to the power lines. The

trial Judge concluded that the positioning of the vehicle was the inevitable consequence of the

appellant's requirement that the feed which it carried be placed in a particular bin and the vehicle

was no more than present. The connection with the vehicle was coincidental. There was no

relationship in the sense required by s.3(1) between the vehicle and the appellant's conduct which

gave rise to the liability in respect of which he seeks indemnity. The appeal should therefore be

dismissed with costs.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 84 of 1994

Brisbane

Before McPherson JA.

Moynihan J Ambrose J

[Gesler & Ors v. FAI]

BETWEEN:

KEVIN GESLER

(First Plaintiff)

AND:

NANCY FAY GESLER

(Second Plaintiff)

AND:

WILLIAM REA

(First Defendant)

Appellant

AND:

CAPRICORNIA ELECTRICITY

(Second Defendant)

AND:

FAI GENERAL INSURANCE COMPANY LIMITED

(Third Party)

Respondent

REASONS FOR JUDGMENT - B.W. AMBROSE J.

Judgment delivered 25/07/1995

I have had the opportunity of reading the judgments of McPherson JA and Moynihan J in

this matter. I agree with the statement of facts contained in those judgments and with the analyses of

the relevant authorities and conclusions reached upon them.

I will state only briefly my own conclusions.

In this case the appellant was the owner of a farm upon which the motor vehicle insured by

the respondent was being unloaded by the plaintiff.

Because the appellant placed a container, into which material from the motor vehicle had to

be unloaded, near a power line when it was unnecessary to do so, the motor vehicle had to be

unloaded in a position in which unnecessary danger was caused to the plaintiff.

The plaintiff was injured as a consequence of exposure to that danger, to which he fell

victim.

The appellant was held liable in damages because of his breach of duty to the plaintiff in so

locating the container, into which material from the motor vehicle had to be unloaded, that the

plaintiff would be subjected to avoidable and unnecessary risk.

Whether or not the respondent as licensed insurer of the motor vehicle was liable to

indemnify the appellant for his liability to the plaintiff, depends upon whether that liability comes

within s.3(1) of the Motor Vehicles Insurance Act 1936.

There is no doubt that accidental bodily injury was suffered by the plaintiff in connection with

his unloading the motor vehicle, of which the respondent insurance company was insurer. Indeed,

he was standing on that motor vehicle and attempting to facilitate its unloading with a metal rod when

that rod came into contact with an electric power line, causing him injury.

The question to be determined is whether the appellant's liability under the judgment given

against him on the ground that he had breached his duty of care to the plaintiff in requiring that the

motor vehicle be unloaded in a place dangerous to do so by reason of its proximity to the power line

which caused the plaintiff's injury, is a liability by way of damages "in respect of" the motor vehicle of

which the respondent was licensed insurer.

Under s.3(1) of the Motor Vehicles Insurance Act, the owner of a motor vehicle must keep persons indemnified against sums for which they become liable in damages for accidental bodily injury in respect of that motor vehicle where that injury is caused in connection with that motor

vehicle.

The only obligation to indemnify, which is imposed by the section, is one to indemnify against

a liability for damages in respect of the owner's motor vehicle. To that broadly expressed liability,

however, there is a qualification. The qualification is that such injury must be caused (in the present

case) in connection with the owner's motor vehicle.

On its face, the section does not purport to impose liability upon the owner of the motor

vehicle to indemnify any person in respect of a legal liability for damages howsoever caused in

connection with the motor vehicle. What it imposes is an obligation to indemnify a person who

becomes legally liable for damages for bodily injury in respect of the motor vehicle. The qualification

that such bodily injury must be caused in connection with the motor vehicle does not have the effect

of extending liability for damages beyond that which accrues independently of the section in respect

of the motor vehicle. In other words it does not have the effect of characterising liability for all

bodily injuries caused in connection with a motor vehicle as necessarily a liability in respect of that

motor vehicle. This was the view of the majority in Technical Products Pty Ltd v. State Government

Insurance Office (Q) (1989) 167 CLR 45, particularly at p.48 per Brennan, Deane and Gaudron JJ

and per Dawson J at p.52. The minority view of Toohey J at p.56 did not prevail.

We are obliged to apply the construction of s.3(1) adopted in the majority judgments in

Technical Products Pty Ltd v. State Government Insurance Office (Q) (supra).

I concur with the view expressed by my brothers that upon the facts outlined there is no

discernible, rational relationship between the liability of the appellant for the plaintiff's injury and the

motor vehicle of which the respondent is licensed insurer. The appellant's liability cannot, upon the

facts of this case, properly be described as a liability with respect to the motor vehicle; on the

contrary his liability is with respect to his failure to provide a safe place from where the motor vehicle

might be unloaded.

I agree that the appeal should be dismissed.