Insurance Commission WA v Container Handlers Pty Ltd

[2003] HCATrans 699

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P53 of 2001

B e t w e e n -

INSURANCE COMMISSION OF WESTERN AUSTRALIA

Applicant

and

CONTAINER HANDLERS PTY LTD

First Respondent

UNION des ASSURANCES de PARIS

Second Respondent

ASHLEY ROBERT SUTTON

Third Respondent

Application for special leave to appeal

McHUGH J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO CANBERRA

ON FRIDAY, 9 MAY 2003, AT 2.19 PM

Copyright in the High Court of Australia

__________________

MR B.W. WALKER, SC:   If it please the Court, I appear with my learned friend, MR P.J. BRERETON, for the applicant.  (instructed by Phillips Fox)

MR M.W. ODES, QC:   If it please the Court, I appear with my learned friend, MS. H. SOBOTNIK, for the first respondent.  (instructed by McAuliffe Williams & Partners)

McHUGH J:   Mr Walker and Mr Odes, the Deputy Registrar has certified that she has been informed by Srdarov Richards Burton, solicitors for the second respondent in this matter, that the second respondent will submit to any order of the Court save as to costs.  She also certifies that she has been informed by Pynt McKay, solicitors for the third respondent, that the third respondent will submit to any order of the Court save as to costs.  Yes, Mr Walker.

MR WALKER:   Your Honours, our client is constituted and governed by a statute.  The question at hand could be said to concern the proper understanding and application of a statutory policy.  An objection may be raised at the outset, then why is special leave to this Court required where there is dissatisfaction or a grievance entertained as to the outcome of an argument concerning the application of statutory wording.

McHUGH J:   You say you enter into one and a half million contracts of insurance each year.

MR WALKER:   That is one.  Another is it is very difficult to understand how, as a matter of legislative technique, that the ordinary English word “driving”, leaving aside the not so ordinary English word “directly”, but concentrating on the ordinary English word “driving”, it is difficult to see what one can do as a matter of statutory amendment better than having used that word in place of the far more general expression which did replace it, namely “using”.

McHUGH J:   Yes, I think we will call on your opponent at this stage.

MR WALKER:   If it please, your Honours.

McHUGH J:   Yes, Mr Odes.

MR ODES:   Your Honour, as my learned friend has indicated, this involves an interpretation of a policy in terms of the Motor Vehicle (Third Party Insurance) Act.  The policy which is subject to the provisions of the Act provides that the owner or driver of a motor vehicle is covered:

in respect of the death of or bodily injury to any person directly caused by, or by the driving of, the motor vehicle.

Now, the phrase “directly caused by, or by the driving of, the vehicle” we submit indicates provision of cover in two separate situations, firstly, where the injury is directly caused by the motor vehicle and secondly, where the injury is directly caused by the driving of the motor vehicle.  So what is clear from this legislative provision and the provision of the contract itself is that cover is contemplated where the injury is directly caused by the motor vehicle which is no longer being driven, in other words, cover is given to injuries caused by a stationary motor vehicle in certain circumstances.

Our submissions are confined to the first of the two inquiries, namely the question as to whether the injury is directly caused by the motor vehicle itself.  That will appear from the respondent’s submissions in the application book, so that basically we contend that on the facts of the case the injury to the plaintiff in this case was directly caused by the motor vehicle.  Now, there is a limitation to that ‑ ‑ ‑

HEYDON J:   Mr Odes, what about section 3(7) that says ‑ ‑ ‑

MR ODES:   That is the limitation I am going to refer the Court to.  The limitation to that is to be found, as your Honour correctly points out, in section 3(7) which limits the recovery for the injury directly caused by the motor vehicle by providing that the:

bodily injury to any person shall not be taken to have been caused by a vehicle if it is not a consequence of the driving of that vehicle –

So section 3(7) certainly does circumscribe the circumstances under which recovery can be made under the policy for an injury directly caused by the motor vehicle, but what section 3(7) significantly does provide is that it must be not a direct consequence of the driving but merely a consequence of the driving and we submit, with respect, that on the facts of this particular case ‑ ‑ ‑

McHUGH J:   But it does not say it is not a consequence of the use of the vehicle; it must be “a consequence of the driving” of the vehicle.

MR ODES:   That is correct, and we say that on the facts of this case it is clear that the plaintiff suffered his injury when the axle of the vehicle fell on to his hand and we say that that indicates that it was directly caused by the motor vehicle and we say that the injury was as a consequence of the driving because basically the blow‑out occurred as a result of the driving of the vehicle over the rough terrain in the northwest.

So our submission is that the facts of this case clearly indicate that the bodily injury was caused by the motor vehicle and it was as a consequence of the driving of that vehicle and we say that our learned friend’s contention is of course that the chain of causation has been broken by the intervention of the negligence of the owner of the vehicle.

We say that that contention is in fact erroneous because it asks the wrong question.  The question which has to be asked is, was the injury directly caused by the motor vehicle and not, was the injury caused by the negligence of the driver, and that is the intervening cause which my learned friend seeks to put into this chain of events.

We say that the negligence issue – and there is a distinct separation, a clear distinction between the liability for negligence, on the one hand, and the causal connection between the bodily injury and the motor vehicle, on the other.  That distinction has been in fact referred to on several occasions in the High Court itself in the case of GIO v Green and also the Dickinson Case itself.  Although the comments were made in a different statutory setting, we submit that the comments that were made are of equal importance to the present statutory regime.

I might just take the Court to Green’s Case which is authority No 11 in the respondent’s list of authorities and refer the Court to page 444.  As your Honours are aware, the statutory formulation at that stage was the bodily injury caused by or arising out of the use of the vehicle, but there was a causation issue that was involved as well and at page 444 ‑ ‑ ‑

McHUGH J:   Now, what judgment is it?  My pages are not numbered, so what judgment is it?

MR ODES:   It is the judgment of the Chief Justice, Justice Barwick and it is on the last page of his judgment just before the judgment of Justice McTiernan.

McHUGH J:   Yes.

MR ODES:   He says:

With every respect, I do not think that we should be warranted in intruding into the statutory expression the limitation of the relevant use of the motor vehicle to its negligent use as was done by the Supreme Court of New Zealand –

He then quotes authorities –

The Act does not evidence any intention to limit the injury against the liability for which the insured is to be indemnified to injury caused by or arising out of a negligent use of the motor vehicle.  Of course, the liability of the owner to the injured person may require some tortious act, usually negligence for which the owner is responsible though many cases of liability will arise out of workmen’s compensation legislation.  But the necessity for some tortious or other basis of the liability of the owner does not require any qualification of the word “use” in the statutory expression.  It is the injury which must be caused or arise out of the use, not the liability for the injury.

Similarly, in Dickinson’s Case – Dickinson’s Case is in fact authority No 2 on my list – the same distinction is drawn and I refer the Court to pages 504 and 505 of that authority.  At 504 – this is the combined judgment of the Chief Justice, Justice Mason and Justices Wilson, Brennan, Dawson and Toohey.  In the first paragraph they are dealing with the argument similar to the one that is raised by my learned friend:

If that were so, then its scope would be less than that of the other provisions to which we have referred, because liability for negligence in respect of injury caused by or arising out of the use of a motor vehicle is not limited to injury caused by the negligent use of the vehicle.  As Barwick C.J. pointed out in Government Insurance Office of N.S.W. v R.J. Green & Lloyd Pty. Ltd., under the wider formula it is the injury which must be caused by or arise out of the use of the motor vehicle, not the liability for injury.  The latter may arise from a tortious act other than the negligent use of a motor vehicle.

Over the page, at page 505 at the top of the page the learned judges indicate:

the question is not whether the father’s negligence was in the use of the motor car.  It is whether the appellant’s injuries were caused by or arose out of the use of the motor car.  It is the failure to observe this distinction which appears to lie behind the decision of the Full Court and the submissions made on behalf of the respondent.

We say that on the facts of the case the injury to the plaintiff was directly caused by the motor vehicle and we say that that injury was as a consequence of the driving of that vehicle.  We say that the blow‑out occurred as a consequence of that vehicle being driven along the unsealed roads and the direct cause of the injury was the motor vehicle and the injury was as a consequence of the driving of that.

We submit that it is, in fact, in each case dealing with a question of causation, a question of fact and commonsense and we say that there are no new principles that would be applied by this Court in the hearing of the appeal that calls for a discussion.  If there is nothing else the Court wishes to put to me, then I have no further submissions.

McHUGH J:   Thank you, Mr Odes.  Yes, we need not hear you in reply, Mr Walker.  There will be a grant of special leave in this case.

MR WALKER:   May it please the Court.

McHUGH J:   Yes, the Court will now adjourn.

AT 2.33 PM THE MATTER WAS CONCLUDED