Maher v Setori Engineering Pty Ltd

[2007] TASSC 84

[2007] TASSC 84

CITATION:              Maher v Setori Engineering Pty Ltd & Anor [2007] TASSC 84

PARTIES:  MAHER, Allan Terence
  v
  SETORI ENGINEERING PTY LTD
  BARRICK (HENTY) LIMITED

TITLE OF COURT:  SUPREME COURT OF TASMANIA
JURISDICTION:  ORIGINAL
FILE NO/S:  466/06
DELIVERED ON:  8 November 2007
DELIVERED AT:  Hobart
HEARING DATES:  29 October 2007
DECISION OF:  Master S J Holt

CATCHWORDS:

Procedure – Supreme Court Procedure – Tasmania – Practice under rules of court – Other matters arising before trial – Separate decision of questions – When appropriate.

Supreme Court Rules2000 (Tas), r559.
Aust Dig Procedure [277]

REPRESENTATION:

Counsel:
             Plaintiff:  Mr R J Phillips
             First defendant:  Mrs A R Mills
             Second defendant:  Mr P L Jackson
Solicitors:
             Plaintiff:  Phillips Taglieri  
             First defendant:  Dobson Mitchell & Allport
             Second defendant:  Zeeman & Zeeman
Judgment Number:  [2007] TASSC 84
Number of Paragraphs:  34

Serial No 84/2007
File No 466/06

MAHER v SETORI ENGINEERING PTY LTD & ANOR

REASONS FOR DECISION  MASTER S J HOLT
  8 November 2007

1. The second defendant has applied for an order that a question raised by its defence be tried before any other. 

1. The power to make such an order is contained in the Supreme Court Rules 2000, r559, which is as follows:

"Questions of fact or law tried differently

(1)      In any proceeding and at any time, the Court or a judge may order that –

(a) different questions, whether of fact or law, be tried at different places or by different modes of trial; or

(b)      any question be tried before any other.

(2)      On an application for an order under subrule (1), the Court or judge is to have regard to –

(a)      the advantage of hearing evidence without undue delay; and

(b)      the costs which may be incurred; and

(c)      any other relevant matter.

(3)      If any issue which has been ordered to be tried or any question or issue of fact which has been ordered to be determined in any manner has been determined, the Court or a judge may give any judgment as is appropriate on the application of –

(a)       the plaintiff or applicant; or

(b)       if the plaintiff or applicant fails to do so within 10 days, any other party.

(4)      If only some of the questions or issues ordered to be determined or tried have been determined or tried and the result renders the determination or trial of the other questions or issues unnecessary or renders it desirable that their determination or trial be postponed, the Court or a judge may give any judgment as may be appropriate, without waiting for that trial or determination. "

1. As to the principles to be applied in determining such an application there was no disagreement.  In brief terms they are as follows:

h       The discretion is to be exercised judicially and is not fettered by rigid rules. 

hOrdinarily all issues in proceedings are decided at the one time.  "Single-issue trials should … only be embarked upon when their utility, economy, and fairness to the parties are beyond question."   Tepko Pty Ltd v Water Board (2001) 206 CLR 1 at par170.

hThe occasions when single-issue trials are ordered "must be carefully controlled lest fragmentation of the proceedings (particularly when the exercise of right of appeal is borne in mind) brings delay, expense and hardship – that which the making of an order was intended to avoid".  Tallglen Pty Ltd v Pay TV Holdings Pty Ltd (1996) 22 ACSR 130 at 142.

hA single-issue trial might have the necessary utility, economy and fairness where the resolution of the issue may resolve the whole dispute and there is a clear demarcation between the issue to be resolved and all other issues.

hA single-issue trial is rarely likely to be appropriate if it will occasion findings of fact which go to other issues in the proceedings, or an assessment of the credibility of witnesses or materials which assessment may also be relevant in the determination of other questions arising in the proceedings. 

1. Counsel for the second defendant submitted that a favourable answer to the question sought to be isolated will resolve the whole of the proceedings against the second defendant.  He said that in relation to the question there is "a very small compass of disputed facts", and if the second defendant succeeds on the question it will have been saved considerable time and expense.  Counsel for the plaintiff, with whom counsel for the first defendant agreed, submitted that the evidence required to resolve the point may also go to other issues in the case.  He said that the plaintiff would need to go into evidence and that issues of credit might arise such that a separate trial was not appropriate.

1. I now turn to consider the application in detail. 

1. In the action the plaintiff claims against the two defendants damages for personal injury.  He alleges that he was employed by the first defendant, an engineering company, as a fitter and turner.  That the first defendant had contracted with the second defendant, a gold mining company, to provide maintenance services to the second defendant at its gold mine.  That on 15 February 2004 he was injured in the course of his employment whilst working at the gold mine.  In particular, using the words in the statement of claim at par6, he was injured in the course of replacing "worn winder sheave wheel inserts … in the cage wheel of the cage".  He claims that his injury was due to the negligence and breaches of statutory duty of both defendants. 

1. A worker's right of action against his or her employer is limited by the Workers Rehabilitation and Compensation Act 1988 ("the Act"). At the time of the injury the Act, s138AA(1) which is in Division 2 of Part X provided:

"This Division applies to the awarding of damages against an employer independently of this Act in respect of an injury suffered by a worker if –

(a)the injury was caused by the negligence or other tort of, or a breach of contract by, the worker's employer;  and

(b)compensation has been paid or is payable in respect of the injury under this Act or would have been paid or be payable but for section 25(2)."

1. Section 138AB, which is in the same division, has not been materially altered since the date of the injury. It currently provides:

"Election to claim damages

(1)      Before commencing proceedings in court for an award of damages, a worker who intends to seek damages against his or her employer must lodge with the Tribunal an election to claim damages.

(2)      A worker is not to make an election unless the degree of his or her permanent impairment is agreed by the worker and the employer, or determined by the Tribunal, to be a percentage of the whole person of not less than 30%.

(3) An assessment of the degree of the worker's impairment is to be carried out in accordance with section 72 or 73.

(4)      An election is to be in a form approved by the Tribunal.

(5)      An election is to be lodged within 2 years after the date on which the claim for compensation is given to the employer of the worker, or person designated by the employer, under section 34.

(6)      The Tribunal may extend the period within which an election is to be made if –

(a)      there is a dispute as to the level of the worker's impairment; or

(b)      the injury is not stable and stationary.

(7)      If there is a dispute as to the degree of impairment, the worker may apply to the Tribunal for a determination of the degree of impairment.

(8)      An application under subsection (7) is to be –

(a) accompanied by evidence from a medical practitioner that he or she is of the opinion that the degree of impairment is not less than 30% of the whole person; and

(b) made not less than 21 days before the expiration of the period referred to in subsection (5).

(9)      If the Tribunal determines the degree of impairment to be not less than 30% of the whole person, the worker is to lodge his or her election within 21 days after the determination.

(10)     The Tribunal may refer the question of the degree of impairment to a medical panel in accordance with Part V.

(11)     An election to claim damages does not preclude a worker from receiving compensation under this Act.

(12)     This section does not apply to proceedings taken by a personal representative or dependant of a worker who has died as a result of an injury for which compensation is payable under this Act." 

1. The lodging of the election with the Workers Rehabilitation and Compensation Tribunal as required by s138AB is a necessary part of the cause of action against the employer. Skilled Engineering Ltd v Glaxo Wellcome Australia Pty Ltd [2005] TASSC 39 at par46 and Skilled Engineering Ltd v Glaxo Wellcome Australia Pty Ltd [2005] TASSC 86 at par21.

1. The second defendant says that it is a deemed employer of the plaintiff and, accordingly, has the protection of s138AB. In particular, that there can be no cause of action against it unless an election has been lodged.

1. Section 132 relevantly provides that in Part X of the Act:

"'employer', used in relation to an injury suffered by a worker, includes any person who, in respect of that injury, is liable under section 29, to pay compensation …".

1. Section 29(1) has not been amended. It is as follows:

"(1)      Where a person (in this section referred to as 'the principal') in the course of, or for the purposes of, his trade or business contracts with any other person (in this section referred to as 'the contractor') for the execution by or under the contractor of the whole or any part of any work undertaken by the principal, the principal is liable to pay to a worker employed in the execution of the work any compensation under this Act that he would have been liable to pay if that worker had been immediately employed by him." 

1. The plaintiff has pleaded in par12 of his amended statement of claim that on 17 October 2006 he lodged an election with the Workers Rehabilitation and Compensation Tribunal.  A copy of that election was tendered during the course of the hearing of this application.  It is date stamped by the Tribunal for 17 October 2006 and is in the following terms:

"REFERRAL TO TRIBUNAL
SECTION 138AB

TO:     The Registrar
           Workers Rehabilitation &
             Compensation Tribunal
           DX 52
           HOBART

Employer:                  Setori Engineering Pty Ltd
  Horwath Tas Pty Ltd
  Level 8/85 Macquarie Street, Hobart in Tasmania

Insurer:                     GIO General Limited
  111 Macquarie Street, Hobart in Tasmania

Worker:  Allen [sic] Maher
  19 Sedgewick Street, Queenstown in Tasmania

I, Allen [sic] Maher of 19 Sedgewick Street, Queenstown in Tasmania being a worker who alleges to have suffered an injury, on 15.02.2004, in the circumstances described in part X of the Act, hereby elect to claim damages in respect of that injury. I have been assessed as suffering a permanent impairment of not less than 30% of the whole person in accordance with assessment conducted pursuant to Sections 72 and 73 of the Act.

DATED this 16th day of October 2006.

PHILLIPS TAGLIERI  DOBSON MITCHELL & ALLPORT

Per:  Per:

Practitioners for the Worker            Practitioners for the Employer"

1. In relation to the maintenance work which the first defendant, being the plaintiff's direct employer, agreed to perform the defence of the second defendant includes in par3(b):

"The contract will be referred to at trial for its full terms and effect but an effect of the contract is that at all material times the second named Defendant was an employer of the Plaintiff for the purposes of Part X of the Workers Rehabilitation and Compensation Act 1988 ('the Act').

PARTICULARS

(I)The contract provided for the execution by or under the first named Defendant of part of the work undertaken by the second named Defendant at the second named Defendant's gold mine.

(II)The second named Defendant was therefore liable, under s29 of the Act, to pay compensation to the Plaintiff in accordance with the Act in respect of any injury suffered by the Plaintiff while he was employed in the execution of work under the contract.

(III)The second named Defendant was therefore an employer of the Plaintiff for the purposes of Part X of the Act by reason of the definition of 'employer' for the purposes of that Part of the Act to be found in s132 of the Act, ".

1. In response to the plaintiff's plea in par12 of his amended statement of claim, that an election was lodged the second defendant pleads the following in pars12 and 14 of its defence:

"12      The second named Defendant does not admit the allegations in paragraph 12 of the Statement of Claim but says that if the Plaintiff lodged with the Tribunal an election to claim damages, as alleged in paragraph 12:

(a)the election lodged with the Tribunal did not relate to the second named defendant or in any way otherwise constitute an election to claim damages against the second named Defendant;

(b)at the time when the election was lodged no agreement had been made between the second named defendant and the Plaintiff that the degree of the Plaintiff's permanent impairment was a percentage (of) the whole person of not less than 30%, as required by s138AB(2) of the Act;

(c)at the time when the election was lodged no determination had been made by the Tribunal, in proceedings to which the second named Defendant was a party, that the degree of the Plaintiff's permanent impairment was a percentage of the whole person of not less than 30% as alternatively required by s138AB(2) of the Act;

(d)the election was not lodged within the period limited for that purpose by s138AB(5) of the Act and no order has been made by the Tribunal pursuant to s138AB(6) of the Act, in proceedings to which the second named Defendant was a party, extending the period within which an election was to be made.

14       The second named defendant says that if the Plaintiff was injured in the circumstances alleged in paragraphs 6 to 10 (inclusive) in the Statement of Claim (which allegations are not admitted) and if the Plaintiff's injuries were caused by negligence or breach of statutory duty on the part of the second named defendant as alleged in paragraph 13 of the Statement of claim (which allegations are denied), nevertheless by reason of;

-the matters pleaded in paragraphs 3 and 12 hereof;  and

-sections 138AA and 138AB of the Act;

the Plaintiff has not acquired a cause of action for damages against the second named Defendant, and has no entitlement to claim damages against the second named Defendant, in respect of his injuries."

1. The second defendant's application is in terms:

"Pursuant to Rule 559 of the Supreme Court Rules 2000 the following question raised in paragraphs 3, 12 and 14 of the Secondnamed Defendant's Defence dated 26 February 2007 be tried before any other:

'Has the Plaintiff acquired a cause of action for damages against the Secondnamed Defendant in respect to the personal injury, loss and damage set out in paragraph 11 of the Plaintiff's Amended Statement of Claim dated 16 January 2007.'"

1. Assuming that the second defendant is correct so far as the matters specified in par12 of its defence are concerned, the question still remains as to whether the second defendant is a deemed employer by virtue of s29(1). In particular a question will arise as to whether the injury causing work undertaken by the plaintiff for the first defendant under its maintenance contract with the second defendant was, using the words of s29(1) "any part of any work undertaken by" the second defendant.

1. As to what is meant by the phrase "any work undertaken by the principal", which is in numerous workers compensation statutes, the leading case is Moir v Schrader (1936) 56 CLR 310. There Dixon J (as he then was) observed at 323 that the phrase is "not susceptible of exact definition and of completely certain application". His Honour went on to say at 323 – 324:

"What he has thus adopted as his proper operations, he may accomplish by means of direct employees, or by means of contracts which remove him from the relation of employer with the workmen who do the work.  Whichever be his method, he is to be responsible for the workers' compensation payable to those injured in the course of the work for the performance of which he has assumed responsibility, the work which he has 'undertaken.'  But when, although the work performed by the injured workman is necessary to enable the principal to carry out the operations the execution of which he has adopted as his trade or business, yet that work does not form a component part of the operations and only contributes or conduces to their performance or is preliminary or ancillary or incidental to them, then the workman must look to his direct employer for compensation." 

1. After referring to some admissions of fact on the pleadings, counsel for the second defendant said:

"We would certainly need to lead some evidence as to whose sheave it was and its function, but that is it.  Once we have established that, the issue then is as a matter of law, well does that fall within the maintenance contract or not."

1. With respect to counsel for the second defendant, there is an issue of fact to be determined, in particular, whether the maintenance work was, using the words in s29(1) "work undertaken by the principal". The second defendant in its defence at par3(b)(i) has alleged that the maintenance contract work was work "undertaken by the second named defendant" and the plaintiff has not admitted this.

1. Counsel for the plaintiff rightly said that an enquiry into whether the second defendant was a deemed employer would need to go well beyond ascertainment of "whose sheave it was and its function".  The evidence would need to go to the nature of the operations of both defendants and the work which the plaintiff was required to perform.  Counsel for the plaintiff submitted that some of this evidence may relate to other matters in dispute in the proceedings.  The credit of some witnesses may be brought into contest.  In other words, there is no clear line of demarcation separating matters relevant to the deemed employer question from other matters in issue in the proceedings.

1. Counsel for the second defendant made no submission that the Court could or should prevent the plaintiff from presenting the evidence foreshadowed.  The facts and outcomes of a number of the English cases referred to by Dixon J in Moir at pages 320 - 323 are instructive as to the need to ascertain what work is "undertaken by the principal" and what work of contractors is part of the work undertaken by the principal as opposed to work which "only contributes or conduces to [its] performance or is preliminary or ancillary or incidental to" its performance. Moir at 324.

1. Referring to Skates v Jones & Co [1910] 2 KB at 910 Dixon J said:

"A syndicate formed for the purpose of conducting a skating rink purchased an existing structure for removal to the site chosen.  They let a contract for the removal and re-erection of the building and, in the course of that work, one of the contractor's men was injured.  Although the contract may have been for the purpose of a business of a skating-rink proprietor, it was held not to be for work undertaken by the principals who had adopted that business."

1. Regarding Spiers v Elderslie Steamship co Ltd (1909) S.C. 1259. Dixon J observed that "… the Court of Session decided that, although the business of shipowning involved maintaining ships' boilers in good condition the operation of cleaning them was not one which the shipowner undertook as part of his business".

1. In relation to Dittmar v Owners of Ship V593 [1909] 1 KB 389, Dixon J said:

"On the other hand, coal merchants who in the course of that trade acted as lightermen were considered to 'undertake' work which included the navigation of a lighter from the place where it was taken over by them from the shipbuilders to the depot where it was to be employed in the coal trade.  Accordingly they were liable to a member of the crew injured upon the voyage, notwithstanding that he was employed by an independent contractor to whom the owners had delegated the work of taking the vessel out of the depot … The coal merchants in the course of their trade or business contracted for the execution of part of the work proper to their undertaking and in that sense undertaken by them … This means that the work of navigating the vessel which they had delegated was regarded as a component part of the work which the coal merchants had assumed to perform as traders."

1. The next case was Hayes v S J Thompson & Co (1913) 6 B.W.C.C. 130.  Comparing the facts and decision there to the facts and decision in Spiers, Dixon J said:

"In this it differed from boiler-cleaning and from the operation of overhauling barges which … was held to be not part of the trade or business of barge owners but only work which arose out of it."

1. It is how the particular business is operated which is relevant rather than how similar businesses are generally operated.  Dixon J said:

"The fact that boiler cleaning or scaling is never done for himself by a particular shipowner but is always entrusted to contractors may show that the work 'undertaken' by that shipowner does not embrace such operations (Luckwill v Auchen Steamship Co Ltd (1913) 108 L.T. 52.). This accords with the view taken in Bush v Hawes(1902) 1 KB 216. It was there held that, to determine whether a thing was in the usual course of or for the purpose of a trader's business, it was necessary to consider not how such a business was generally conducted by others but what was the nature of the work done by the particular trader."

1. Hockley v West London Timber and Joinery Co (1914) 3 KB 1013, was summarised by Dixon J as follows:

"… a manufacturer of mouldings used timber purchased from abroad.  The manufacturer, acting in accordance with the general practice of the trade, did not employ his own servants to take delivery of the timber from the ships by which it was imported.  Contracts were made with several contractors for the successive operations of receiving the timber into barges, carting it from the wharves upon which it was discharged from the barges and unloading the timber from the carts and stacking it in the yards where it would season.  It was held that the operation of stacking was not part of the work 'undertaken' by the manufacturers of mouldings."

1. Dixon J went on to quote the following passage from the judgment of Pickford LJ in Hockley:

"In order to do their business of moulding manufacturers they must have timber, and they must have seasoned timber.  Therefore the timber is stacked, and it is stacked for the purpose of being seasoned, but the stacking and seasoning are not parts of the actual operation of moulding manufacture, and it is a thing that has been always done by this firm, and by other firms in the same business, by means of contractors, and not by means of their own men or by themselves at all.  The authorities make it quite clear that it is not enough that the work that is being done should be incidental to, or even necessary for, the preparation for the work which is actually done by the principal." 

1. Bobbey v W M Crosbie & Co Ltd (1915) 112 L.T. 900, in the words of Dixon J was:

"…a case in which the manufacturers, whose raw material was imported, employed outside labour to unload a cargo consigned to them and to place the goods in their store." 

1. Of this case, Dixon J said:

"In the Court of Appeal Lord Cozens-Hardy MR said that the work of unloading a bulk cargo was not work undertaken by the principals.  'They deliberately abandoned such work, one experiment having satisfied them that their own men were not suitable for such work, and they employed gangers or similar men to do the work'".  

1. I am not persuaded that the question sought to be isolated by the second defendant for discrete determination is a question which will involve only "a very small compass of disputed facts" as asserted by counsel.  The evidence presented on the question may be extensive and may also be relevant to a consideration of other matters going to whether the injury was caused by the negligence or breach of statutory duty of either or both of the defendants.

1. Counsel for the second defendant referred me to the judgment of Einstein J in Matrix Film Investment One Pty Ltd & Ors v Alameda Films LLC and Warner Bros Entertainment and Pictures Inc (2007) NSWSC 523. He said that it was a case which conveniently gathered together the principles relevant to a consideration of an application of this kind. An application of those principles, in my view, makes it clear that the second defendant's application should be dismissed. His Honour said at par13:

"In Idoport Pty Ltd v National Australia Bank Ltd [2000] NSWSC 1215 at [7] some of the general principles were chronicled as follows and to my mind correctly so:

…

(3)       The Court begins with the proposition that it is ordinarily appropriate that all issues in a proceeding should be disposed of at the one time: Tallglen Pty Ltd v Pay TV Holdings Pty Ltd (1996) 22 ACSR 130 at 141 per Giles CJ in Comm D, Hadid v Australis Media Ltd (unreported, Supreme Court of NSW, 29 March 1996 per Rolfe J). Accordingly, it is for the party who wishes to have a question separately determined to show that it is desirable for that to occur.

(5)       … the separate determination of an issue will rarely be an appropriate procedure where:

(a)there are intertwined issues of fact or law between the separated question and the other questions such that the determination of the separate question will not have any substantial effect upon the width of the field of litigious controversy or the prospect of the settlement of the balance of the litigation: Law Society of NSW v Bruce (unreported, Supreme Court of NSW, 23 April 1996, per Rolfe J), Parramatta Stadium Trust v Civil and Civic Pty Ltd (unreported, Supreme Court of NSW, 27 August 1996, per Hunter J).

(b)where there is a commonality of witnesses and issues of credit as between the separate issue and other issues in the case which will or may necessitate a ruling on the credit of one or more of the common witness, thus possibly precluding that same judicial officer from again dealing with the matters going to the credit of the common witness in accordance with the decision of the Court of Appeal in Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411.  Story of Sydney Pty Ltd v Ling (unreported, Supreme Court of NSW 15 November 1994, per Rolfe J), Century Medical v THLD Ltd [2000] NSWSC 5; (unreported, Supreme Court of NSW, 3 February 2000, per Rolfe J).

(c)there is a possibility that the resolution of the separate issue will not finally determine the issue but will merely result in an appeal from that decision in relation to that separate issue, creating a multiplicity of proceedings, interruption to the court and undesirable fragmentation of the proceedings: Story of Sydney Pty Ltd v Ling (supra), Century Medical v THLD (supra).

(6)       The experience of courts suggests that the separation of proceedings often does not result in the quicker and cheaper resolution of proceedings as anticipated, but often has the reverse effect, merely causing added delay and expense to the resolution of the litigation. Thus, before an issue is to be separately determined, it must be possible to clearly see that it will facilitate the quicker and cheaper resolution of the proceedings: Tallglen Pty Ltd v Pay TV Pty Ltd (supra, at 142 per Giles CJ in Comm D), Parramatta Stadium Trust v Civil and Civic Pty Ltd (supra), Century Medical v THLD (supra).

1. I am not persuaded that there is utility, economy and fairness in fragmenting the trial in the way proposed by the second defendant. As to the matter mentioned in r559(2)(a) there was no assertion that there was any advantage in hearing evidence without delay on the question sought to be isolated. There will be an order dismissing the application.