Molloy v BGC (Australia) Pty Ltd

[2006] WADC 98

JURISDICTION     :   DISTRICT COURT OF WESTERN AUSTRALIA

IN CHAMBERS

LOCATION:   PERTH

CITATION:   MOLLOY -v- BGC (AUSTRALIA) PTY LTD & ORS [2006] WADC 98

CORAM:   MCCANN DCJ

HEARD:   5 MAY 2006

DELIVERED          :   29 JUNE 2006

FILE NO/S:   CIV 310 of 2001

BETWEEN:   DOUGLAS JOHN MOLLOY

Plaintiff

AND

BGC (AUSTRALIA) PTY LTD
Defendant

MANUFACTURERS MUTUAL INSURANCE LTD (NOW ALLIANZ AUSTRALIA INSURANCE GROUP)
First Respondent

WESFARMERS FEDERATION INSURANCE LTD
Second Respondent

Catchwords:

Statutory interpretation - Construction of Corporations Act s 601AG and Insurance Contracts Act s 51(1)

Practice and procedure - Application to join insurers as third parties - Whether appropriate to summarily determine the merits of the proposed proceedings

Legislation:

Corporations Act 2001 (Cth), s 601AA, s 601AG
Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947, s 7(1)(c), s 7(2)
Law Reform (Miscellaneous Provisions) Act 1946 (NSW), s 6
Supreme Court Act 1986 (Victoria), s 60
Company Law Review Act 1998 (Cth)
Insurance Contracts Act 1984 (Cth) s 51(1)

Workers Compensation and Rehabilitation Act 1981 (WA), s 93D(4)

Result:

Appeal allowed
Leave granted to issue third party notices

Representation:

Counsel:

Plaintiff:     No appearance

Defendant:     Ms A M I Schoombee

First Respondent           :     Mr N M Beech

Second Respondent       :     Mr N M Beech

Solicitors:

Plaintiff:     Bradford & Co

Defendant:     Blake Dawson Waldron

First Respondent           :     Lavan Legal

Second Respondent       :     Pynt & Partners

Case(s) referred to in judgment(s):

Almario v Allianz Australia Workers Compensation (NSW) Insurance Ltd (2005) 62 NSWLR 148

ASC v MacLeod [2000] WASCA 101

ASC v Marlborough Goldmines Limited (1993) 177 CLR 492

Australian Turf Industries Pty Ltd v Dalet Pty Ltd, unreported; FCt SCt of WA, Library No 980658, 12 November 1998

Bitumen and Oil Refineries (Australia) Ltd v Commissioner for Government Transport (1954‑1955) 92 CLR 200

Bull v Attorney General (NSW) (1913) 17 CLR 370

Campbell v Amaca Pty Ltd [2005] WASC 272

Findlay v Westfield Development Corporation Limited & Anor (1972) 1 NSWLR 422

Government Insurance Office (Qld) v Brisbane Stevedoring Pty Ltd (1969) 123 CLR 228

Hazart Pty Ltd v Rademaker (1993) 11 WAR 26

Hutchinson v ASIC (2001) 167 FLR 90

Langridge v Insurance Commission of Western Australia [2003] WASC 24

Littlewood v George Wimpey and Co Ltd and British Overseas Airways Corporation [1953] 2 QB 501

McDowell v Baker (1979) 144 CLR 413

National Mutual Fire Insurance Co Ltd v Commonwealth of Australia (1981) 1 NSWLR 400, 1 ANZ Insurance Cases 60-438

Nominal Defendant v Butler; Hartford Fire Insurance Co (1976) 1 NSWLR 546

Norsworthy v SGIG [1999] SASC 496

Pagnon v WorkCover Qld [2001] 2 Qd R 492

Port of Melbourne Authority v Anshun Pty Ltd (1980‑1981) 147 CLR 589

Re Brashs Pty Ltd (1994) 15 ACSR 477

State Government Insurance Office (Qld) v Crittenden (1996) 117 CLR 412

Sturk v SGIO Insurance Limited [2002] WADC 58

Suncorp Metway Insurance Ltd v Clonmel Pty Ltd [2000] QSC 135

Victorian WorkCover Authority v Esso Australia Limited (2001) 207 CLR 520

Vollstedt & Anor v Calibre Enterprises Pty Ltd (1999) 10 ANZ Insurance Cases 61‑440

Webb v Estate of Darryl Arthur Herbert C/- The Public Trustee & Anor [2006] WASCA 43

Case(s) also cited:

Brambles Constructions Pty Ltd v Helmers (1966) 114 CLR 213

Brice v Wackerbarth [1974] 2 Lloyds Rep 274

Carshore v North Eastern Railway Co (1885) 29 Ch D 344

CIC Insurance Ltd v Bankstown Football Club (1997) 187 CLR 384

Corti v Rodwell [1985] VR 287

Curry v Melton Shire Council [1998] VSC 352

Edison v Swan United Electric Light Co v Holland (1886) 33 Ch D 497

General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125

Greenfold Holdings Pty Ltd v ACB Human Resources Pty Ltd [2003] NSWSC 1184

Hordern-Richmond Ltd v Duncan [1947] KB 545

In the Matter of Fensford Pty Ltd [2004] VSC 179

Joyce Royal Pty Ltd (formerly Allnet Corporation Pty Ltd) v Harris [2001] WASC 1

New South Wales Aboriginal Council Land Council v Ace Global Markets & Ors (2005) 188 FLR 389

Orica Ltd v CGU Insurance Ltd (2003) 59 NSWLR 14

Zeini v Intersen Pty Ltd & Anor [2006] NSWC 107

1. MCCANN DCJ:  This is an appeal from an order of the Principal Registrar made on 22 March 2006 dismissing the defendant's application for leave to issue third party notices against Manufacturers Mutual Insurance Ltd (which is now known as Allianz Australia Insurance Group) ("MMI") and Wesfarmers Federation Insurance Ltd ("WFI").  The appeal is a hearing de novo, that is to say, it is treated as a rehearing of the original application (see Hazart Pty Ltd v Rademaker (1993) 11 WAR 26).

2. The plaintiff's claim against the defendant is for damages in respect of an injury which he allegedly received when he fell off scaffolding whilst erecting a steel roof structure for an extension to the defendant's factory in Canning Vale on 14 February 1995. The plaintiff pleads in his statement of claim that he was employed by Western Mechanical Fabrications Pty Ltd ("WMF") and that he performed work at the defendant's premises pursuant to an agreement between the defendant and WMF. The plaintiff pleads that the defendant breached duties of care which it owed to him as the occupier of the premises and also as the principal responsible for the performance of the building work at the premises. The plaintiff did not join WMF as a defendant. According to the evidence WMF was deregistered pursuant to s 601AA of the Corporations Act 2001 (Cth) on 30 December 2001.

3. There is a potential issue as to whether the plaintiff was an employee of WMF (as pleaded in his statement of claim) or an independent contractor of that company. In either case, the defendant contends that WMF was liable in tort to the plaintiff in respect of the plaintiff's injury on the grounds that WMF owed the plaintiff a duty of care to ensure that he had a safe place of work and used a safe method of working, irrespective of whether he was an employee or independent contractor of that company. It is not in dispute for the purpose of the defendant's application that the plaintiff had an arguable claim for damages against WMF before that company was deregistered and that the defendant would (if adjudged liable to the plaintiff) have had an arguable claim for contribution or indemnity from WMF pursuant to s 7(1)(c) of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 ("the Contribution Act").  The issue in this application is whether the defendant has an arguable right to enforce such right of contribution or indemnity directly against WMF's liability insurer (or insurers) so as to justify their joinder as third parties in the present action.

4. The defendant seeks to claim directly against the insurers pursuant to s 601AG of the Corporations Act 2001 (Cth) and s 51(1) of the Insurance Contracts Act 1984 (Cth). The learned Principal Registrar held that the defendant could not avail itself of those provisions. He applied the decision of the Supreme Court of Queensland in Suncorp Metway Insurance Ltd v Clonmel Pty Ltd [2000] QSC 135 in holding that the defendant could not avail itself of s 601AG and followed the decision of the Full Court of the Supreme Court of this state in Australian Turf Industries Pty Ltd v Dalet Pty Ltd (unreported; FCt SCt of WA, Library No 980658, delivered 12 November 1998) in holding that the defendant could not avail itself of s 51 (1).  The defendant contends that Suncorp Metway was incorrectly decided and that Australian Turf Industries is distinguishable in that it was concerned with the interpretation of a different legislative provision to s 51(1), namely the phrase "proceedings in which damages are sought" in the former s 93D(4) of the Workers' Compensation and Rehabilitation Act 1981 (as the Workers' Compensation and Injury Management Act 1981 was then known).

5. This action has a long and drawn‑out history which appears from the affidavits of Paul Reithmuller sworn on 10 February 2006 and Shannon Chapman sworn on 7 April 2006.

6. The defendant contends that MMI issued an employers' indemnity policy ("the MMI policy") to WMF which covers any liability of WMF at common law, and under the Contribution Act, for personal injuries sustained by a person who was employed by WMF under a contract of service on 14 February 1995.  The defendant apprehends that the MMI policy excludes any liability for claims for personal injury where the plaintiff was "a worker by reason only of s 175" of the Compensation Act.  MMI's solicitors have written to the defendant's solicitors contending that the plaintiff was a sub‑contractor of WMF and fell within the purview of s 175 of the Compensation Act and accordingly (it is contended) the MMI policy would not respond to any claim in respect of the plaintiff's injury.

7. Mr Reithmuller deposed in his affidavit to an exchange of correspondence between his firm and WFI's solicitors, and as to his professional experience of the wording of liability insurance policies, from which the defendant contends that it can be inferred that WFI issued a business liability policy to WMF ("the WFI policy") which may cover WMF in the event that the MMI policy does not respond.  The defendant has not been able to obtain a copy of the WFI policy wording at this stage. 

8. The defendant submits, correctly in my view, that it will only be possible to conclude whether the plaintiff was an employee or sub‑contractor of WMF and hence whether the MMI policy or the WFI policy responds after all the evidence has been adduced and factual findings have been made in the plaintiff's action.

9. It is not in dispute that the merits of WMF's entitlement to cover under either or both of the MMI policy or the WFI policy are not suitable for determination on this application. That is to say, the joinder of the respondents is not opposed on any ground other than the applicability of s 601AG of the Corporations Act or s 51(1) of the Insurance Contracts Act.

The relevant legislation

1. Section 601AG of the Corporations Act provides:

   "A person may recover from the insurer of a company that is deregistered an amount that was payable to the company under the insurance contract if:

   a)the company had a liability to the person; and

   b)the insurance contract covered that liability immediately before deregistration."

2. Section 51(1) of the Insurance Contracts Act provides as follows:

   "(1)Where:

   a)the insured under a contract of liability insurance is liable in damages to a person (in this section called the third party);

   b)the insured has died or cannot, after reasonable enquiry, be found; and

   c)the contract provides insurance cover in respect of the liability;

   the third party may recover from the insurer an amount equal to the insurer's liability under the contract in respect of the insured's liability and damages."

3. Section 7(1)(c) of the Contribution Act provides as follows:

   "[W]here damage is suffered by any person as the result of a tort ‑

   . . .

   c)any tortfeasor liable in respect of that damage may recover contribution from any other tortfeasor who is or would if sued have been liable in respect of the same damage whether as a joint tortfeasor or otherwise…"

4. Section 7(2) of the Contribution Act provides as follows:

   "In any proceedings for contribution under this section, the amount of the contribution recoverable from any person shall be such as may be found by the Court to be just and equitable…"

General principles

1. It is not in dispute that any cause of action which the defendant has against WMF pursuant to s 7(1)(c) of the Contribution Act as a joint or concurrent tortfeasor would only accrue upon judgment being entered for the plaintiff against the defendant (see Suncorp Metway (supra) per Muir J at [21] citing Bitumen and Oil Refineries (Australia) Ltd v Commissioner for Government Transport (1954‑1955) 92 CLR 200 at 211 and Littlewood v George Wimpey and Co Ltd and British Overseas Airways Corporation [1953] 2 QB 501 at 519).

2. It is a well‑established procedure that a defendant who is sued in tort may issue third party proceedings under the Contribution Act against an alleged joint or concurrent tortfeasor even though the defendant has not yet been found liable to the plaintiff, and, accordingly, when the defendant's statutory cause of action against the third party has not accrued.  (See Port of Melbourne Authority v Anshun Pty Ltd (1980‑1981) 147 CLR 589 at 595.)

3. It has been held that the appropriate test to be applied in determining whether to set aside the joinder of a defendant who has been improperly or unnecessarily made a party by a plaintiff is the same as that which applies in determining an application by a defendant for summary judgment, that is to say, the joinder of the defendant should not be set aside unless it is clear that there is no real question to be tried (see Webb v Estate of Darryl Arthur Herbert C/- The Public Trustee & Anor [2006] WASCA 43 per Wheeler JA at [12] and Campbell v Amaca Pty Ltd [2005] WASC 272 per Le Miere J at [5]). In my view, the same test should apply to the question whether third party proceedings can properly be commenced by a defendant; that is to say, the issue is whether there is no real question to be tried in the third party proceedings. (See: Vollstedt & Anor v Calibre Enterprises Pty Ltd (1999) 10 ANZ Insurance Cases 61‑440 .)

4. It has been held (see Almario v Allianz Australia Workers Compensation(NSW) Insurance Ltd (2005) 62 NSWLR 148 per Ipp JA at [19]‑[20]) that s 601AG of the Corporations Act creates a new, statutory cause of action against a deregistered company's insurer which is separate from the injured party's cause of action against the company itself. The action is not a claim for damages. It is an action for the amount that was payable to the deregistered company under the relevant insurance contract. A claim pursuant to s 601AG is subject to two conditions, namely, proof that the deregistered company "had a liability" to the person claiming, and that the insurance contract covered that liability, immediately before the deregistration of the company. The time for determining whether the deregistered company had a liability to the person claiming, and whether the insurance contract covered that liability, is immediately before the deregistration occurred. The cause of action survives the re‑registration of the company (see Langridge v Insurance Commission of Western Australia [2003] WASC 24 per Barker J at [55). It has been held that it is not necessary for the deregistered company's liability to the injured party to have been adjudicated upon. It is sufficient if there was an accrued cause of action before the deregistration took effect (see Hutchinson v ASIC (2001) 167 FLR 90 per Senior Master Mahoney at [25]).

Applicability of s 601AG of the Corporations Act to contribution claims

1. The respondents rely on the decision of the Supreme Court of Queensland in Suncorp Metway (supra). In that case Muir J held that the "liability" of the deregistered company referred to in par (a) of s 601AG (which must have come into existence immediately prior to its deregistration) predicated a wholly accrued cause of action against the company. His Honour held that, since a cause of action pursuant to the Queensland equivalent of s 7(1)(c) of the Contribution Act does not accrue until the plaintiff has obtained judgment against the defendant (see par 14 above), a deregistered company could not have "a liability" to a concurrent or joint tortfeasor within the meaning of s 601AG at the time of its deregistration unless judgment had been entered against the latter at that time. Thus, it is submitted on behalf of MMI and WFI that the defendant in this matter could never have access to WMF's insurance cover even if the plaintiff is ultimately successful against the defendant.

2. The respondents relied upon the principle (see ASC v Marlborough Goldmines Limited (1993) 177 CLR 492, Re Brashs Pty Ltd (1994) 15 ACSR 477 at 483 per Hayne J and ASC v MacLeod [2000] WASCA 101 at [94] and [97]) that a judicial interpretation placed on uniform national legislation should not be departed from by another court unless that court is convinced that the earlier decision is "plainly wrong". The respondents submit that the decision in Suncorp Metway has in fact been approved, albeit obiter, on numerous occasions (see Hutchinson v ASIC (supra), Sturkv SGIO Insurance Limited [2002] WADC 58 per Martino DCJ at [9] and Langridge (supra) at [26]) and can not be said to be "plainly wrong".  They therefore submit that it should be followed and the defendant's application dismissed.

3. The defendant submitted that it is arguable that the decision in Suncorp Metway is based upon an unduly narrow reading of the phrase "had a liability" in s 601AG(a) and did not address the arguments advanced before me. The defendant submitted that the favourable treatment of the decision in Hutchinson, Sturk and Langridge should be considered to be obiter and not binding because none of those cases involved a contribution claim by a defendant, there was no express analysis of the arguments which were advanced before me and in Langridge the Court simply acknowledged that the parties had accepted between themselves that the principle was correct.

4. The defendant submitted that the essential question is whether the legislature intended that the words "had a liability" in s 601AG countenanced the long established practice that a contribution or indemnity claim may be brought in third party proceedings at the same time as the plaintiff's action, so as to enable all related matters to be settled in one proceeding with a view to saving time and costs and avoiding multiple litigation of the same controversy (with the potential for different results).

5. It was submitted that the cases relied on by Muir J, namely Bitumen and Oil Refineries and Littlewood, were concerned with the question as to when a complete cause of action accrues under the contribution legislation for the purposes of statutory limitation, whereas the issue in the present matter is the interpretation of s 601AG which is a remedial provision. It is therefore submitted that s 601AG should be construed so as to give the fullest relief which the fair meaning of the language will allow (see Bull v Attorney General (NSW) (1913) 17 CLR 370 at 384 per Isaacs J). It is submitted that by adopting a beneficial interpretation which recognises the historical practice of allowing third party contribution proceedings to be brought on a contingent basis, the phrase "had a liability" can be construed as meaning "would have had a liability, if sued."

6. It is next submitted that s 601AG should also be given a purposive construction, which allows the Court to take into account the mischief that the legislation was designed to overcome and the objects of the legislation, namely "to require the insurer of a deregistered company to stand in the shoes of the company to the extent necessary to allow creditors of the company to recover from the insurer whatever amounts they were entitled, by force of law, to recover from the company had it not been deregistered" (see Almario (supra) per Ipp JA at [34]).  The defendant also referred to Pagnon v WorkCover Qld [2001] 2 Qd R 492 per MacPherson JA at [17]:

   "The legislative policy underlying s 601AG is, however, not open to doubt. It is to 'short‑cut' the need to reinstate the company, and to do so by enabling the ultimate recipient of the insurance proceeds to sue the insurer direct where the company has been dissolved, without imposing the additional trouble and expense of first applying to have it re‑instated."

7. The defendants next submitted that the phrase "had a liability" is ambiguous in that several meanings are open.  Firstly (it is submitted) the phrase could mean that there must have been a judgment against the deregistered company before it can be said that it "had a liability".  Second, there must at least have been a wholly vested cause of action against the deregistered company at the time of deregistration.  Thirdly, the phrase could mean that the company had a liability to be sued on a cause of action which could not be struck out in the sense that the company had committed the relevant tort and would, if sued, be liable to the plaintiff (and the defendant too).  Thus far, only the first and second meanings have received judicial support.  The defendant contends that the phrase should be construed so as to embrace all three meanings.  The defendant submits that recourse may be had to the Explanatory Memorandum to the Company Law Review Bill 1997 (which preceded the Company Law Review Act 1998 which inserted s 601AG in the Corporations Act) so as to resolve any ambiguity. The memorandum includes an explanation of s 601AG which states that "comparable rights have previously been provided in other legislation, for example, s 6 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW)."  Section 6 provides, relevantly, as follows:

   "6(1)If any person (hereinafter in this Part referred to as the insured) has….entered into a contract of insurance by which he is indemnified against liability to pay any damages or compensation, the amount of his liability shall on the happening of the event giving rise to the claim for damages or compensation, and notwithstanding that the amount of such liability may not then have been determined, be a charge on all insurance monies that are or may become payable in respect of that liability.

   (2)….

   (3)….

   (4)Every such charge as aforesaid shall be enforceable by way of an action against the insurer in the same way and in the same court as if the action were an action to recover damages or compensation from the insured; and in respect of any such action and of the judgment given therein the parties shall, to the extent of the charge, have the same rights and liabilities, and the court shall have the same powers, as if the action were against the insured…

   (5)Such an action may be brought although judgment has already been recovered against the insured for damages or compensation in respect of the same matter."

1. The defendant conceded that s 6 of the Law Reform (Miscellaneous Provisions) Act is worded differently to s 601AG, but nevertheless submitted that in the light of the Explanatory Memorandum the interpretation of the Commonwealth legislation should proceed on the basis that the legislature sought to achieve purposes similar to those of the NSW legislation, as the same had been previously construed and applied by the Court of Appeal of that state.

2. The defendant relied upon the decision of the New South Wales Court of Appeal in National Mutual Fire Insurance Co Ltd v Commonwealth of Australia(1981) 1 NSWLR 400, 1 ANZ Insurance Cases 60-438. In that case the Court of Appeal held that the charge created by s 6(1) in respect of an insured's "liability to pay any damages or compensation" attached to payments made in respect of the liability of an insured tortfeasor to pay contribution to another tortfeasor. Glass JA (with whom Moffitt P and Samuels JA agreed) said (page 406) that "the key phrase 'liability to pay damages or compensation' is somewhat curious" and that it contained "no limitation such as 'in respect of death or bodily injury' or 'for personal injury' which is found in related contexts." His Honour continued as follows:

   "It also contrasts with the phrase 'liable by way of damages' to be found in some third party policies (State Government Insurance Office (Qld) v Crittenden (1966) 117 CLR 412) and with the phrase 'liable in respect of that damage' which is the constant refrain in sec.5 which immediately precedes it in the enactment in question. It is to be remembered that the imposition of liability on one tortfeasor to contribute to the damages payable by another was a wholly novel type of liability introduced by the Act of which sec.6 is a part. The history of judicial decisions thereafter shows, I believe, a developing tendency to treat it as part of the tortfeasor's overall liability for damages and not to treat it as a separate remedy against him. The early decisions did, it is true, emphasise the difference between a proceeding for a contribution and an action for damages. In Nickels v Parkes (1949) 49 SR(NSW) 124 it was held that proceedings for a contribution against the Commissioner were not governed by a limitation of time applicable to an action against him for negligence in the performance of his duties. In Unsworth v Commissioner of Railways (1958) 101 CLR 73 the High Court held that a proceeding for a contribution did not fall within the statutory description of 'an action to recover damages or compensation in respect of personal injuries.'

   The turning point leading to a broader view of the tortfeasor's liability occurred in Genders v Government Insurance Office of New South Wales (1959) 102 CLR 363. The court was construing the indemnity of the compulsory third party policy required by the Motor Vehicles (Third Party Insurance) Act, 1942, s 10 which insures the owner and driver against 'all liability incurred in respect of the death or bodily injury' etc.  It was held that the words included a liability of one tortfeasor to pay a contribution to another …"

3. His Honour then cited a passage from the judgment of the High Court in Genders and referred to a number of other decisions of the High Court of Australia which also dealt with the interpretation of the word "liability" and derivatives of the same in the context of policies of liability insurance.  Those cases included State Government Insurance Office (Qld) v Crittenden (1996) 117 CLR 412 and Government Insurance Office (Qld) v Brisbane Stevedoring Pty Ltd (1969) 123 CLR 228. Glass JA also referred to two decisions of the Supreme Court of New South Wales, namely Findlay v Westfield Development Corporation Limited & Anor (1972) 1 NSWLR 422 and Nominal Defendant v Butler; Hartford Fire Insurance Co (1976) 1 NSWLR 546. In the course of analysing these authorities, his Honour stated that he regarded the reasoning in Genders (and, by implication the other authorities), was "highly persuasive since it rests on the doctrinal conception that the liability of the wrongdoer should be treated as a comprehensive term which includes not only his primary liability to the injured party but also his secondary liability to other tortfeasors."  At pages 407 ‑ 408 his Honour said:

   "None of these decisions is exactly in point since none of the policy indemnities was expressed in language identical with that contained in the section.  But since a tortfeasor's liability to pay a contribution to another tortfeasor has been included within contractual phrases such as 'liability in respect of death or bodily injury' (Genders) and his 'liability by way of damages' (Brisbane Stevedoring) it would, I think, be pedantic to exclude it from the statutory description of 'liability to pay any damages'."

4. The issue for immediate determination is whether the defendant's contention that Suncorp Metway was wrongly decided is arguable. 

5. In my view there is force in the respondent's submissions. The fact that s 601AG creates a statutory cause of action in its own right which accrues upon the deregistration of the company (see par 17 above), is somewhat incompatible with the provision also embracing an inchoate or contingent right such as a claim for indemnity or contribution. I would respectfully concur that on a textual construction of s 601AG (a) the word "liability" means a liability pursuant to an accrued cause of action.

6. However, in Almario (supra) Ipp JA expressed the view that s 601AG should not be textually construed but instead should be construed in a way "which accords with the purpose of the legislation and removes anomalies and inequities" (at [46])). At [37]‑[40] his Honour held that notwithstanding the "significant" differences between the wording of s 601AG and s 6 "the basic concept underlying the two different statutory provisions is the same, as the Explanatory Memorandum correctly recognises", namely that the rights conferred by the two statutes should be regarded as "comparable". Given the construction placed upon s 6 in National Mutual Fire Insurance (supra) it could therefore be argued that the Commonwealth Parliament intended that s 601AG should be construed such that a company's liability to pay contribution or indemnity to another tortfeasor is embraced by the words "had a liability". I would comment however that the approach to the construction of s 601AG which was adopted in National Mutual Fire Insurance is different from that which found favour in the Full Court of this State in Australian Turf Industries (see pars 34‑35 below).

7. In Almario, Ipp JA referred to the decisions in Pagnon (supra) and Hutchinson (supra), but did not refer to Suncorp Metway.  The precise issue in Suncorp Metway did not arise in Almario. The latter case concerned a worker seeking to recover "damages" at common law directly against his former employer's workers compensation insurer pursuant to s 601AG.

8. The issue in this appeal is a complex one which requires analysis of a number of authorities which are not consistent with each other.  In my view that tends to support allowing the defendant the opportunity to fully argue its case against the respondents at the trial of the plaintiff's action.  I have taken into account that in Campbell Le Miere J held (obiter at [18]) that "it is arguable that 'liability' in s 601AG includes a contingent or inchoate liability", although I also note that case is distinguishable on its facts (because it dealt with a claim by a plaintiff against an insurer and different issues arose on the facts compared to this matter), and whilst his Honour was referred to Hutchinson (see par [26]) and Langridge, he was not referred to Suncorp Metway.  I have also taken into account that in Webb (supra) Wheeler JA held at [24] that it was not appropriate on a summary judgment application to deal with the "question of some complexity" which arose in relation to the effect of s 51(1) of the Insurance Contracts Act and, in my respectful view, a similar approach is warranted in respect of the construction of s 601AG at this interlocutory stage.

Section 51(1) of the Insurance Contracts Act

1. The respondents submitted that an order for contribution or indemnity is distinguishable from a liability in damages and, therefore, that it is not arguable that WMF was ever "liable in damages" to the defendant for the purposes of s 51(1)(a) of the Insurance Contracts Act.  In Norsworthy v SGIC [1999] SASC 496 at [59]‑[62], Olsson J held (applying a "liberal" construction because of the "remedial" nature of the provision) that the "insured" for the purpose of s 51(1) includes an insured corporation which has been deregistered.

2. The respondents relied on the decision of the Full Court in Australian Turf Industries Pty Ltd (supra).  In that case the Full Court was concerned, inter alia, with the question whether third party proceedings in which a defendant claimed an indemnity or contribution from an alleged joint or concurrent tortfeasor were "proceedings in which damages are sought" within the meaning of that phrase in the former s 93D(4) of the Compensation Act.  Each member of the Court (Ipp J, as his Honour then was, Wallwork J and Steytler J, as his Honour then was) held that a proceeding for contribution or indemnity is distinct from one for damages and applied what was said by members of the High Court of Australia in Unsworth (supra).  The issue in that case was virtually the same as the issue before the Full Court.  Steytler J held as follows (at p 24):

   "It seems to me that a cause of action for a contribution or indemnity is distinct from one for damages.  As was said in Unsworth v Commissioner for Railways (1958) 101 CLR 73 at 86 (per Fullagar J) and 91 (per Taylor J) the mere fact that it is necessary, in an action for a contribution or indemnity, to prove that the person against whom the claim is made is one 'who is or would if sued have been liable in respect of the same damage' does not turn such an action into one to recover damages in respect of personal injury."

3. Their Honours referred to and distinguished other decisions of the High Court of Australia namely Genders (supra); McDowell v Baker (1979) 144 CLR 413 and State Government Insurance Office (Qld) v Brisbane Stevedoring Pty Ltd (supra).

4. The defendant submitted that Australian Turf Industries and Unsworth are distinguishable as they dealt with the interpretation of restrictive provisions, whereas s 51(1) of the Insurance Contracts Act is remedial in nature and should be given a liberal construction.  The defendant further submitted that it is established that the same word can have a different meaning in different statutory provisions depending on the context in which it is used and cited Pearce and Geddes, "Statutory Interpretation Australia", 5^th ed, 2001 at 89.  To illustrate this proposition the defendants referred to the decision of the High Court of Australia in Victorian WorkCover Authority v Esso Australia Limited (2001) 207 CLR 520 in which the High Court held (at [41]) that the words "any proceeding for the recovery of debt or damages" in s 60 of the Supreme Court Act 1986 (Victoria) should be understood as a composite expression that embraced any proceeding in which a claim for money was made and therefore included a claim for indemnity by the WorkCover Authority in respect of payments for compensation made by an injured employee.  Thus, it was submitted that the interpretation of the word "damages" which prevailed in Australian Turf Industries and Unsworth need not necessarily prevail in the context of s 51(1) and the words "liable in damages" should be interpreted liberally to include a liability in respect of a contribution claim. The defendant further submitted that the same purposive or policy considerations that applied to the construction of s 601AG should also apply to the construction of s 51(1).

5. The defendant also relied on Vollstedt (supra) in which Beach J held (at [23] and [27]) that it was arguable that the words "liability in damages" in s 51(1) should be given a far wider meaning than damages for tort or breach of contract. In that case his Honour held that it was arguable that the applicant defendants were entitled to recover contribution from a deceased co‑defendant's liability insurer pursuant to s 51(1). Accordingly the insurer was held to have been properly joined by way of third party proceedings.

6. The defendant also relied on the recent decision of the Court of Appeal of this state in Webb (supra) in which Wheeler JA held at [24] (Pullin JA and Buss JA agreeing) "that the effect of s 51(1) in the...circumstances [of that case] is a matter of some complexity, in relation to which there is limited authority…which…does not appear to be all one way" and accordingly held (together with other grounds) that summary judgment ought not to be granted to the second defendant insurer. The facts of Webb are distinguishable from the facts of the present case but is noteworthy that Vollstedt is cited without any adverse comment.

7. The respondents submitted that the views of Beach J in Vollstedt (supra) were obiter and inconsistent with the views of the Full Court in Australian Turf Industries and were therefore of little or no persuasive value. In my view there is a good deal of force in the respondent's submissions. It is beyond argument that the relief provided by s 7(1)(c) of the Contribution Act (namely indemnity or contribution) is a statutory remedy which is different from the common law remedy of damages, notwithstanding the fact that both remedies are founded upon the same fact, namely that the plaintiff has suffered loss or damage as a result of a tort, or torts, of the joint or concurrent tortfeasors.  Although Australian Turf Industries is not strictly binding in this case since it relates to a different statutory provision, it is nevertheless highly persuasive.

8. The question is whether the countervailing submissions of the defendant are sufficiently arguable to justify the right to proceed to trial in the third party proceedings. In my view that question should be answered in the affirmative for the reasons submitted by the defendant and bearing in mind that the ultimate question is the construction of remedial legislation in respect of which similar considerations arise as in the construction of s 601AG. Both Vollstedt (supra) and Webb (supra) support the view that the complexities of the construction of s 51(1) should not be determined in a summary or interlocutory proceeding.

Conclusion

1. In my view, notwithstanding the authorities which suggest that the proposed third party proceedings may not be able to succeed, the submissions advanced by the defendant in relation to the construction of s 601AG and s 51(1), and as to the applicability of the decisions in Suncorp Metway and Australian Turf Industries respectively, cannot be said to be unarguable or untenable or foredoomed to fail.

2. Accordingly, in my view the defendant is entitled to issue third party notices against the respondents and I would allow the defendant's appeal and grant its application.