Pertzel v Qld Paulownia Forests Ltd
[2008] QDC 9
•8 February 2008
DISTRICT COURT OF QUEENSLAND
CITATION:
Pertzel v Qld Paulownia Forests Ltd & Anor [2008] QDC 9
PARTIES:
BERT ALFRED PERTZEL
Plaintiff
AND
QLD PAULOWNIA FORESTS LTD
First Defendant
AND
ALLIANZ AUSTRALIA INSURANCE LTD
Second Defendant
FILE NO/S:
BD1084/04
DIVISION:
PROCEEDING:
Determination of questions before trial
ORIGINATING COURT:
District Court, Brisbane
DELIVERED ON:
8 February 2008
DELIVERED AT:
Brisbane
HEARING DATE:
10 December 2007
JUDGE:
McGill DCJ
ORDER:
Order that the following questions be decided separately from all of the questions in these proceedings, and answered as follows:
(a) Is the claim made by the plaintiff in these proceedings a “motor vehicle accident claim” as that term is defined in s 4 of the Motor Accident Insurance Act 1994 (Qld)?
Answer: No.
(b) If the answer to (a) is in the negative:(i) Is the second defendant estopped or precluded, and if so to what extent, from contending that:
(A) the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as that term is defined in the Motor Accident Insurance Act; or,
(B) it is not liable to pay such claim, if adjudicated in the plaintiff’s favour, as if it were “a motor vehicle accident claim” as so defined?
Answer: Yes in respect of both (A) and (B).(ii) Has the second defendant waived any right it may have had to contend that the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as so defined?
Answer: No.
(c) Do the provisions of s 52 of the Trade Practices Act 1974 (Cth) apply to any or all of the second defendant’s pleaded conduct in these proceedings?
Answer: Yes.
(d) If yes to (c), by any of the pleaded conduct to which it is applicable, by engaging in such conduct, did the second defendant contravene s 52 of the Trade Practices Act?
Answer: Yes.
(e) If yes to (d), has the plaintiff suffered loss and damage by such contravening conduct, pursuant to s 82 of the Trade Practices Act?
Answer: No.
Order that the costs of the plaintiff and the second defendant of and incidental to the determination of these questions be each party’s costs in the cause.CATCHWORDS:
MOTOR VEHICLES – Compulsory Insurance – scope of cover – insurer proceeding as if liable – whether estopped – whether misleading or deceptive conduct
ESTOPPEL – Conduct – licensed insurer proceeding as if liable until limitation period expired – whether insurer estopped from denying liability to indemnify
TRADE PRACTICES – Misleading or Deceptive Conduct – licensed insurer proceeding with claim as if liable under policy until after limitation period expired – whether in trade or commerce – whether misleading – whether loss caused.
Motor Accident Insurance Act 1994.
Trade Practices Act 1974 (Cth) s 52.
Boath v Central Queensland Meat Export Co Pty Ltd and Anor [1986] 1 Qd R 139 – considered.
Brew v Followmont Transport Pty Ltd (No. 2) [2005] 2 Qd R 482 – distinguished.
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 – applied.
Chapman v Luminis Pty Ltd (No. 5) (2002) 123 FCR 62 – distinguished.
Commonwealth v Verwayen (1990) 170 CLR 394 – applied.
Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594 – considered.
Freshmark Ltd v Mercantile Mutual Insurance (Aust) Ltd [1994] 2 Qd R 390 – applied.
HIH Casualty and General Insurance Ltd v AXA Corporate Solutions [2002] EWCA Civ 1253 – cited.
I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 – applied.
Kabwand Pty Ltd v National Australia Bank Ltd (1989) 11 ATPR 40‑950 – cited.
ReKu‑Ring‑Gai Cooperative Building Society (No. 12) Ltd (1978) 36 FLR 134 – cited.
Lindsay v Smith [2002] 1 Qd R 610 – applied.
Morris vFAI General Insurance Co Ltd [1996] 1 Qd R 495 – cited.
Northern Assurance Co Ltd v Cooper [1968] Qd R 46 – applied.
Queensland Alumina Ltd v Alinta DQP Pty Ltd [2007] QCA 287 – cited.
Salisbury v Farley Constructions Pty Ltd [2000] QDC 51 – considered.
Sirway Asia Pacific Pty Ltd v The Commonwealth [2002] FCA 1152 – cited.
SWF Hoists and Industrial Equipment Pty Ltd v State Government Insurance Commission (1990) 12 ATPR 41‑045 – followed.
Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 – applied.
Watson v Foxman (1995) 49 NSWLR 315 – distinguished.
Wilson v Austral Motors (Qld) Pty Ltd [1983] 2 Qd R 774 – applied.
WJ Green & Co v Wilden Pty Ltd (Civ 1478/96, Parker J, S Ct of WA 24‑4‑97, unreported, Lib No 970186) – distinguished.COUNSEL:
R.J. Douglas SC for the plaintiff
D.B. Fraser QC and M.J. Liddy for the second defendant
SOLICITORS:
Jensen McConaghy for the plaintiff
Deacons lawyers for the second defendant
The plaintiff was driving a truck in the course of his employment on 2 April 2001 when it left the roadway and collided with a tree stump, causing him injury. The plaintiff alleges that the accident occurred because the truck was in various respects defective or inadequately maintained, and that as a result his employer, the first defendant, was in breach of its tortious duty to take reasonable care to provide the plaintiff with a safe system of work, a safe place of work, and safe plant and equipment. Negligence on the part of the first defendant has been disputed on the second defendant’s pleading; the first defendant is a company in liquidation, and as a result the action has not proceeded against that company.
The second defendant was at the relevant time the licensed insurer of the vehicle being driven by the plaintiff, under a policy of insurance issued pursuant to the Motor Accident Insurance Act 1994 (“the Act”).[1] The vehicle was at the relevant time being driven on a road, so it was required to be insured under the Act: s 20.
[1]It was common ground before me that the relevant version of that Act to which I should refer was reprint number 4, as in force on 1 December 2000.
The plaintiff’s injury was obviously caused by, through or in connection with the motor vehicle he was driving. Accordingly the requirements of s 5(1) of the Act were satisfied and the Act applies to the plaintiff’s injury. The vehicle was not uninsured, and did not fall into any of the exclusions contained in subsection (3). On 31 July 2001 the plaintiff’s solicitors sent a notice of claim under s 37 of the Act to the second defendant. Initially the second defendant disputed that the notice satisfied the requirements of the Act, but on 30 October 2001, after further information was provided by the plaintiff’s solicitors, the second defendant confirmed that the notice of claim had complied with the requirements of s 37.
History of the action
The matter proceeded in accordance with the Act, but was not resolved in the pre‑litigation proceedings, and the present proceedings commenced on 23 March 2004 by the filing of the claim and statement of claim. This occurred before the pre‑litigation proceedings had been concluded, with the consent of the second defendant. Subsequently there was a conference, written final offers were exchanged, and the proceeding continued, with the defence being filed on 8 October 2004 by solicitors retained by the second defendant on behalf of both defendants. No issue was taken in that defence as to the applicability of the Act, or as to the entitlement on the part of the plaintiff to judgment against the second defendant pursuant to s 52(4) of the Act if the plaintiff proved his case.
However, on 19 August 2005 an amended defence of the defendants was filed which raised for the first time the assertion that the policy which existed pursuant to the Act did not insure the first defendant against any liability to pay damages for the injury to the plaintiff, because if the first defendant was liable as alleged by the plaintiff, the plaintiff was an employee of the first defendant acting in the course of his employment and was the driver of the insured motor vehicle at the time of the motor vehicle accident out of which the injury arose, and it arose from the first defendant’s failure to provide a safe system of work or the breach of some other duty of care to the employee. Accordingly, liability under the statutory policy in these circumstances was excluded by clause 3(2) of the policy.
When the vehicle was last registered or the registration was last renewed, a policy of insurance in terms of the schedule to the Act came into force for the vehicle, issued by the second defendant in favour of the first defendant: s 23(1) of the Act.[2] The terms of the policy are set out in the schedule to the Act. Clause 1 of the policy provides that it insures against liability for personal injury to which the Act applies caused by, through or in connection with the insured vehicle anywhere in Australia, clause 2 provides that the first defendant is a person insured by the policy, and clause 3 provides exclusions which included at the time of the collision subclause (2):
“This policy does not insure an employer against a liability to pay damages for injury to an employee if –
(a)the injury arises from the employer’s failure to provide a safe system of work for the employee or the employer’s breach of some other duty of care to the employee; and
(b)neither the employer nor another employee of the employer was the driver of the motor vehicle at the time of the motor vehicle accident out of which the injury arose.”
[2]That the second defendant was the relevant licensed insurer was admitted by the second defendant: second amended defence of the second defendant para 1, admitting para 3 of the amended statement of claim of the plaintiff.
This exclusion was inserted into the policy by an amendment made by the Motor Accident Insurance Amendment Act 2000 which took effect on 1 October 2000. That amendment act, which made quite a number of changes to the Act, was designed to address an environment of rising compulsory third party premiums.[3] Although it was not said as frankly as this in the explanatory note, essentially this was done by reducing the benefits available in various ways, such as restricting legal costs recoverability for smaller claims so as to make them uneconomic, introducing a cap on economic loss claims, and restricting claims for loss of consortium or servitium, and gratuitous care claims. There had always been in the statutory policy an exclusion of liability of an employer for worker’s compensation, and according to the explanatory note the amendment to the schedule “strengthens the exclusions under the policy of insurance to specifically exclude a failure of an employer to provide a safe system of work.”[4] Presumably the intention was that the burden of these claims would be transferred from motor vehicle insurers to WorkCover.
[3]See explanatory note to the Bill, 2001 Explanatory Notes vol. 1 p 737.
[4]Ibid p 758.
Curiously, however, although the scope of the policy was restricted in this way, there was no equivalent amendment to s 5 dealing with the application of the Act.[5] It would seem to follow that although the Act still applied in circumstances within the exclusion, the policy did not provide insurance cover to the employer.
[5]There was an irrelevant amendment to s 5(3)(a) by s 7 of the amendment Act.
The plaintiff had taken some steps under the WorkCover Queensland Act, and a notice of assessment issued and a lump sum offer of compensation was made to the plaintiff on 27 March 2002.[6] That offer was then deferred, but on 24 July 2006 it was accepted, as a result of which a payment of a little over $20,000 was made to the plaintiff.[7] The plaintiff explained this on the basis that at that time he was quite short of funds, and this was seen as a means of providing some temporary financial relief while waiting for the present action to come to fruition.[8] The offer was accepted a few days after a mediation on 18 July 2006 failed to settle this action.
[6]Affidavit of Davies filed 6 December 2007 Exhibit RD1.
[7]Ibid paras 6, 7.
[8]Affidavit of the plaintiff filed 6 December 2007 para 5. See also p 19.
An amended claim and statement of claim were filed on behalf of the plaintiff on 10 August 2007. It was then alleged that the first defendant, by the conduct of the second defendant in relation to the claim in the action, had engaged in conduct by which it represented that the compulsory third party insurance policy in respect of the truck did respond to the plaintiff’s claim, that the second defendant was liable in respect of any amount proved by the plaintiff against the first defendant, and that the second defendant was so liable as the compulsory third party insurer of the first defendant: para 10R. The plaintiff then added a claim in the alternative for damages for breach of s 52 of the Trade Practices Act.
A second amended defence of the second defendant was filed on 17 September 2007, in which the second defendant continued to deny liability to the plaintiff on the basis that the insurance policy did not apply because of the exclusion. An amended reply filed on behalf of the plaintiff on 8 October 2007 alleged among other things that the second defendant was estopped from contending that it was not liable to the plaintiff under the Motor Accident Insurance Act, or had waived the right to contend to that effect. A rejoinder was filed by the second defendant on 13 November 2007, disputing the estoppel and waiver.
As a consequence of all this, the parties came before me on 10 December 2007 seeking that the following questions be decided separately from all other questions in these proceedings:
(a) Is the claim made by the plaintiff in these proceedings a “motor vehicle accident claim” as that term is defined in s 4 of the Motor Accident Insurance Act1994 (Qld)?
(b) If the answer to (a) is in the negative:
(i) Is the second defendant estopped or precluded, and if so to what extent, from contending that:
(A) the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as that term is defined in the Motor Accident Insurance Act; or,
(B) it is not liable to pay such claim, if adjudicated in the plaintiff’s favour, as if it were “a motor vehicle accident claim” as so defined?
(ii) Has the second defendant waived any right it may have had to contend that the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as so defined?
(c) Do the provisions of s 52 of the Trade Practices Act 1974 (Cth) apply to any or all of the second defendant’s pleaded conduct in these proceedings?
(d) If yes to (c), by any of the pleaded conduct to which it is applicable, by engaging in such conduct, did the second defendant contravene s 52 of the Trade Practices Act?
(e) If yes to (d), has the plaintiff suffered loss and damage by such contravening conduct, pursuant to s 82 of the Trade Practices Act?
The parties agreed that it was appropriate to determine these questions in advance in this way. The first defendant being in liquidation,[9] there can be no issue as to whether it is necessary for the first defendant to be heard independently from the second defendant in case it wished to make submissions in relation to any of the questions which might be inconsistent with the submissions made on behalf of the second defendant. Presumably WorkCover would have no interest in making any submissions in the matter, being content to rely on the election to accept the offer of lump sum compensation, and s 255 of the WorkCover Queensland Act 1996.[10]
[9]Affidavit of Davies filed 8 August 2007 Exhibit RD8.
[10]WorkCover was given some notice of the application: Affidavit of Davies filed 8 August 2007 para 8, Exhibit RD11.
Question (a)
The first question is concerned with whether the plaintiff’s claim in these proceedings is a “motor vehicle accident claim” as defined in the Act. The question refers to s 4 where the term “motor vehicle accident claim” is defined as meaning “a claim for damages based on a liability for personal injury arising out of a motor vehicle accident and, for a fatal injury, includes a claim on behalf of the deceased’s dependents or estate.” The plaintiff’s claim is for damages on the basis for liability for personal injury, but the question is whether it arises out of a “motor vehicle accident”. That term is also defined in s 4 as “an incident from which a liability for personal injury arises that is covered by insurance under the statutory insurance scheme.” That means that there is only a “motor vehicle accident” for the purposes of the Act in circumstances where the relevant liability for personal injury arising from such an accident is covered by the statutory insurance policy. Accordingly, if the facts fall within the exclusion from the statutory policy, there was no “motor vehicle accident” for the purposes of the Act.
The present claim is one by an employee against an employer in respect of liability alleged to have arisen because of a failure on the part of the employer to provide a safe system of work for the employee, or because of some other breach of the employer’s duty of care to the employee, and neither the employer nor another employee was the driver of the relevant vehicle at the time of the accident. So much appears from the statement of claim.[11] On the plaintiff’s case the injury he suffered as a result of the accident was the result of a defect in the motor vehicle causing loss of control of the vehicle while it was being driven, and was caused wholly or partly by a wrongful act or omission in respect of the motor vehicle by a person other than the plaintiff, namely the first defendant. Accordingly, exclusion 3(2) is satisfied in the case of the plaintiff’s claim, and it follows that the second defendant’s policy did not insure the first defendant against a liability to pay the damages claimed by the plaintiff in the present action.
[11]It does not matter whether the claim is pleaded in contract or in tort: Best v I & G Selke Pty Ltd [2003] QDC 559, which neither party disputed before me.
Accordingly, it was not a liability covered by insurance under the Statutory Insurance Scheme, and it follows that the incident which gave rise to the plaintiff’s action against the first defendant was not a “motor vehicle accident” as defined in s 4 so far as the plaintiff is concerned. Of course, if there had been a passenger in the truck, or any other person about, who was injured as a result of the incident, it would have been a motor vehicle accident so far as that person was concerned. It follows that the plaintiff’s claim for damages is not a “motor vehicle accident claim” as defined in that section. Accordingly, the answer to question (a) is “no”.
I should add that it seems to me this is a different question from the question whether the Act applies to the plaintiff’s personal injury, that is to say the question of whether the requirements of s 5 of the Act were satisfied. If I were being asked to decide that in question (a), the answer would be “yes”. There seems to me to be no requirement in s 5 limiting any of the terms by which the scope of application of the Act is defined to a situation within the cover provided by insurance under the statutory insurance scheme. On the face of it therefore the Act applied in the present case, but that is probably of no practical significance in the present case because the plaintiff’s claim is not a motor vehicle accident claim, so far as his claim is concerned there was no motor vehicle accident, and he is not a claimant for the purposes of the Act. Hence, the various steps required by the Act do not apply to the present plaintiff. It also means that s 52 of the Act does not apply, so that there was no statutory entitlement to bring the proceeding against the second defendant as a joint defendant. The fact that the Act might technically apply is probably therefore of no significance. It merely underlines the fact that the insertion of this limitation into the Act as an exclusion from the policy in the schedule rather than as a limitation on the scope of application of the Act in s 5 created a legislative trap for innocent injured workers such as the plaintiff.[12]
[12]Counsel for the second defendant, in written submissions (para 8.3) said: “The format of the Act and the use of the schedule to the Act being the policy of insurance to help define the scope of the cover are confusing.”
Question (b)(i)
The estoppel alleged in the present case is not based on any specific express representation on the part of the defendant; rather, what is alleged is estoppel by conduct. Further, this is not a situation where the plaintiff’s case is that his understanding of the relevant position was derived from any representation (express or implied) of the defendant; rather, the plaintiff relies on the more generalised formulation of the law of estoppel in the judgment of Deane J in Commonwealth v Verwayen (1990) 170 CLR 394 at pp 444‑446, which makes estoppel applicable if the party sought to be estopped has (inter alia) played such a part in the persistence in a particular assumption on the part of the other party that he would be guilty of unjust and oppressive conduct if he were now to depart from it. In order to understand the basis of this allegation, and to appreciate the context of the alleged estoppel, it is necessary to consider in some detail what passed between the plaintiff and the second defendant in relation to this claim.
History of the claim
In the present case the notion that the plaintiff was injured in what was a “motor vehicle accident” for the purposes of the Act, and that the plaintiff’s claim was a motor vehicle accident claim for the purpose of the Act, came initially from the plaintiff (or rather his solicitors). The first solicitor handling the matter believed it was a claim under the Act,[13] and so notice was given of the claim purportedly pursuant to s 37 of the Act dated 31 July 2001 by the solicitors on behalf of the plaintiff.[14] Under s 17(a) of the Motor Accident Insurance Regulation 2004 the notice of claim must be in the approved form, which was used. That form said that it was to be used “if you personally suffered an injury in a motor vehicle accident which was wholly or partly the fault of some other person”.[15] It was forwarded under cover of a letter from the solicitors dated 14 August 2001, which expressly stated that it was forwarded pursuant to s 37 of the Act.
[13]Affidavit of Andrews filed 12 June 2007 para 6.
[14]Affidavit of Davies filed 12 June 2007 Exhibit RD1.
[15]In the colloquial sense of course the plaintiff was in that position, in that he was injured in an accident involving a motor vehicle; presumably the form is intended to refer to a “motor vehicle accident” as defined in the Act, a slightly but significantly more limited concept.
The claim form indicated that the owner of the vehicle and the plaintiff’s employer were one and the same, that the plaintiff was the driver at the time, and that the plaintiff alleged that the handbrake was not connected, and the accident occurred after the airbrakes had “leaked out”, which presumably reduced their efficiency, when the truck had stalled. The description of the accident included a reference to the vehicle being loaded with woodchips. Although there was not an express statement that the plaintiff was required to drive the vehicle in the course of his employment, it is I think a reasonable inference from what was stated. On the face of the information contained in the Notice of Accident form, therefore, it should have been apparent that exclusion 3(2) of the policy in the schedule applied; at the least, the prospect of this should have been suggested by these facts.
The second defendant responded on 27 August 2001 drawing attention to the transfer of the claim from the insurer FAI General Insurance Co Ltd pursuant to s 30 of the Act, as a result of which “FAI Allianz Limited is the insurer for the purposes of this claim”. The second defendant said that it was not satisfied the notice of claim complied with s 37 of the Act, drew attention to s 5 and said that the claimant had failed to identified who caused the accident and why.[16] The second defendant called upon the plaintiff to remedy the non‑compliance, and to provide “pursuant to s 37A of the Act” additional information with respect to the claim, to be provided on the additional information form attached to the letter. Section 37A(1) permits an insurer to ask a claimant to provide additional information about the claim and the circumstances out of which it arises but only where the insurer is one “to whom notice of a motor vehicle accident claim is given”. It follows that reliance on s 37A on the part of the second defendant involved an implied assertion that it had been given a notice of a motor vehicle accident claim, that is to say, that the notice forwarded by the plaintiff was of a “motor vehicle accident claim”, and hence the incident referred to was a “motor vehicle accident”.
[16]This seemed surprising; it seems to me obvious from the notice of claim that it alleged that the owner of the vehicle, the plaintiff’s employer, had provided an unroadworthy vehicle and that as a result of this the vehicle ran backwards on the slope and caused the accident. It seems to me that the notice given did comply with the requirements of s 37 of the Act.
The letter also advised that “pursuant to section 39(1)(a)(iv) we are not prepared to meet the reasonable and appropriate cost of the claimant’s rehabilitation for those injuries directly sustained in the motor vehicle accident.” Apart from the implied assertion that the plaintiff had suffered injuries in a “motor vehicle accident”, the reliance on s 39(1) is also conditioned upon a notice of a “motor vehicle accident claim” having been given to an insurer under this division or purportedly under this division.
By a letter dated 1 October 2001 the second defendant, after repeating the reference to the effect of s 30 of the Act and the assertion about the identity of the insurer (which appeared on every letter written by the second defendant in relation to this claim), advised again that the “Notice of Accident claim form still does not comply with the requirements of s 37 of” the Act. The second defendant expressly did not waive the non‑compliance, and required compliance to be attended to without further delay. That involved an implied assertion that the obligation of s 37 did fall on the plaintiff if the plaintiff wished to pursue a claim for damages for personal injuries arising out of this accident. The additional information form was signed by the plaintiff on 6 September 2001[17] and presumably forwarded to the second defendant on 16 October; it was acknowledged by a letter of 25 October 2001, and on 30 October 2001 the second defendant confirmed that as a result of the information contained in the letter of 16 October 2001 “the notice now complies with the requirements of s 37 of” the Act.[18] The second defendant went on to request copies of any medical reports or other documentary material relevant to the claim pursuant to s 45(2) of the Act. Section 45(2) imposes an obligation on a “claimant”. It follows from the definitions of “claimant” and “claim” in s 4 that this means a person by whom or on whose behalf a motor vehicle accident claim was made. It would only have applied if the plaintiff had suffered his injuries in a “motor vehicle accident” for the purposes of the Act.
[17]Affidavit of Davies filed 12 June 2007 Exhibit RD2.
[18]Affidavit of Davies filed 12 June 2007 Exhibit RD3.
The second defendant wrote to the plaintiff’s solicitors on 25 February 2002, purporting, pursuant to s 41 of the Act, to admit liability to the extent of 60%.[19] Section 41 imposes an obligation on the insurer who has received notice of a “motor vehicle accident claim” to give a notice advising the claimant whether liability is admitted or denied, and if contributory negligence is claimed, the degree of contributory negligence expressed as a percentage. The letter was not in accordance with that requirement; it purported to “admit liability to the extent of 60%”, when it should have admitted liability, claimed contributory negligence and alleged a degree of contributory negligence of 40%. Nevertheless, the letter was plainly in purported compliance with s 41, and therefore implied an assertion that s 41 of the Act applied.
[19]Affidavit of Davies filed 12 June 2007 Exhibit RD4.
The second defendant had no authority to make the sort of admission of liability contemplated by s 41 of the Act[20] unless the plaintiff’s claim was a motor vehicle accident claim for the purposes of the Act. It involved an admission that the first defendant breached a duty of care owed to the plaintiff. Given that it was clear from the material provided that the plaintiff was the first defendant’s employee, this involved an admission or assertion that any injury suffered by the plaintiff arose from the employer’s breach of a duty of care to the employee, which satisfied the requirement of clause 3(2)(a) of the policy. The letter also expressly referred to the plaintiff’s having agreed to drive the vehicle, which satisfied subclause (b); this was part of the basis of the allegation of contributory negligence, based on his having known that the handbrake was not connected when he drove the vehicle prior to the accident.
[20]As to the effect of this, see Till v Nominal Defendant [2000] 2 Qd R 676.
The letter went on to note that the admission did not extend to any injury or loss or damage alleged to have been sustained as a result of the accident, that it was not intended to be an offer nor form the basis of a contract, that the second defendant reserved its right to rely on any statute which imposed a time limit on the commencement of proceedings, and that notwithstanding any further communication for the purpose of progressing the investigation and the ultimate resolution of the claim “it is the intention of FAI Allianz Ltd to maintain reliance upon any statutory provision which imposes a time limit or any other constraint upon the commencement of legal proceedings. Therefore, any claim to an estoppel being caused by such correspondence will be denied and defended appropriately.”
In order to understand why these statements were made in this letter, it is necessary to have regard to some decisions of Queensland courts. Newton v State Government Insurance Office (Qld) [1986] 1 Qd R 431 was concerned with the question of whether the limitation period still applied in circumstances where the insurer in the course of correspondence had asked for details of the claimant’s claim and had confirmed “that liability is not an issue”. It was held following a review of earlier authorities that there was in that case an agreement between the parties implicit from the fact that after that statement negotiations continued for some time to determine whether the claim could be settled without the need to commence an action, and that accordingly the relevant limitation period was not three years from the date of the injury, which would otherwise have been the case, but six years from the date of the contract: p 437. The majority also pointed out that there may have been as well an estoppel based on the representation that liability was not in issue and by implication that it was unnecessary to commence proceedings before the limitation period expired, and reliance upon it by the claimant to his detriment in allowing the limitation period to expire without commencing proceedings: p 437.
In Morris vFAI General Insurance Co Ltd [1996] 1 Qd R 495 there was a letter from an insurer advising that the insurer was “prepared to accept your client’s claim for personal injuries” and requesting information which could be the basis of an offer for quantum, and it was held that it was open for the plaintiff’s solicitor in these circumstances to assume that the defendant would accept the obligation to pay the plaintiff’s damages and to attempt to negotiate a settlement without his issuing proceedings at that stage, and that acting on that assumption the plaintiff failed to issue proceedings within the statutory time limit. A finding of estoppel on this basis was upheld by the Court of Appeal; the majority[21] relied on the analysis of Deane J in Verwayen (supra) in relation to estoppel.
[21]Pincus and Davies JJA; Fitzgerald P delivered a short concurring judgment.
Morris was applied in the context of the Act by the Court of Appeal in Lindsay v Smith [2002] 1 Qd R 610, from p 618. It was held that an admission compelled by s 41 could be regarded as giving rise to a representation capable of being acted on to the detriment of the claimant. Chesterman J (with whom the other members of the court agreed) said at [31]:
“Not every admission of liability will give rise to an estoppel, but I do not see that, because an insurer is obliged to respond to a notice of claim, that a response admitting liability cannot constitute a representation capable of giving rise to an estoppel. The findings that the respondent, by his solicitor, acted to his detriment by not commencing proceedings within time and by endeavouring to reach a negotiated settlement is sufficient detriment to make it unconscionable for FAI to withdraw its admission.”
The proposition that an earlier decision of the court[22] meant that an admission under this section could not give rise to an estoppel was also rejected. His Honour went on at [36] to note that:
“whether an admission [under s 41] has given rise to an estoppel or a contract depends upon the context. An insurer who wishes to avoid its admission having either consequence can do so by the terms in which it is expressed. If it chooses to admit liability unequivocally it is not, in my opinion, contrary to the objects of the Act that it is bound by the admission where a claimant takes it at its word.”
[22]Till v Nominal Defendant [2000] 2 Qd R 676.
In the light of this, it is unsurprising that by February 2002 a licensed insurer, when making an admission of liability pursuant to s 41 of the Act, was concerned to make it clear that it was not intending to enter into any contract under which it adopted the sort of contractual liability contemplated in Newton, nor was it making an offer capable of being accepted in a way which could give rise to such a contract as to liability, nor was it representing that it was unnecessary to commence proceedings before the expiration of the limitation period, so as to give rise to the sort of estoppel considered in Morris and Lindsay, namely an estoppel preventing reliance on the expiration of the limitation period.[23] Hence the letter referred to statutory provisions which impose a time limit or other constraint upon the commencement of legal proceedings. There were, of course, under the Act other constraints on the commencement of legal proceedings, and plainly the intention was to avoid the situation which arose in Lindsay v Smith, in the manner indicated by Chesterman J.
[23]It was a letter in a form familiar to the plaintiff’s solicitors: Andrews p 41.
It does not follow, however, that the letter of 25 February 2002 is incapable of giving rise to any estoppel at all. The letter expressly reserved the right to rely on any time limit, and referred to an estoppel being caused by future correspondence, but did not expressly reserve the right to do something which would be completely inconsistent with making an admission under s 41, namely asserting that the claim was not a motor vehicle accident claim for the purposes of the Act. The letter did not assert that there was no statutory right to proceed against the insurer, as provided by the Act if it were a motor vehicle accident claim; on the contrary, the letter asserted that any proceeding to enforce the claim was to be brought within any statutory time limit, and was required to comply with any other constraints upon the commencement of the proceedings, presumably those in the Act. That assumed that proceedings to enforce the claim were contemplated, and in the context of the requirement under the Act for any proceeding to be commenced against the second defendant as well as the first, it seems to me clear the letter was talking about a proceeding against the second defendant pursuant to the Act, something which can only be brought in the case of an action for damages for personal injury arising out of a “motor vehicle accident” for the purposes of the Act: s 52(1).
Thereafter the matter proceeded as if it were an ordinary claim under the Act. The second defendant obtained a report from a doctor, a copy of which was forwarded to the plaintiff[24] and on 18 September 2003 sought copies of tax returns for six years, and access to the plaintiff’s Centrelink file, for which purpose a form of authority was enclosed.[25] That letter also foreshadowed an informal settlement conference in due course.
[24]Letter second defendant to plaintiff’s solicitors 7 August 2003, Affidavit of Davies filed 8 August 2007 Exhibit RD6.
[25]Affidavit of Davies filed 12 June 2007 Exhibit RD6.
The next correspondence was from solicitors for the second defendant, who in a letter of 26 September 2003 advised the plaintiff’s solicitors they were acting, and foreshadowed making an advance payment under the Health and Other Services (Compensation) Amendment Act 1996 in the event of a settlement of the matter, although that was expressly said not to be taken as an admission of liability in respect of the claim.[26] On 5 December 2003 the second defendant’s solicitors wrote rejecting the plaintiff’s offer of settlement, advising they had received copies of the Centrelink and WorkCover files, which they were currently reviewing, and pointing out that until that had been completed they were not in a position to proceed to a settlement conference.[27] A request for copies of documents pursuant to s 47 of the Act was made by the plaintiff’s solicitors on 8 December 2003.
[26]Ibid, Exhibit RD7.
[27]Ibid, Exhibit RD8.
In January 2004 the plaintiff’s solicitors became concerned that there had not yet been a compulsory conference, in circumstances where the limitation period was due to expire at the beginning of April 2004. The solicitor handling the matter contacted the solicitors for the second defendant, who said they would seek instructions.[28] On 29 January 2004 the second defendant’s solicitors advised that they were still waiting for instructions as to investigations of the circumstances of the accident (which seem to have been taking the first or second defendant a very long time to undertake) and pointed out that “it is not unforeseeable that the matter would run past the expiration of the limitation period.”[29] The plaintiff’s solicitors decided to make an application for an order dispensing with the necessary preliminary steps under the Act to enable proceedings to be commenced, and told the second defendant’s solicitors that they would be taking this step, enquiring whether the second defendant would prefer to consent to the application or extend the limitation period by agreement.[30] The second defendant’s solicitors advised that they would prefer to consent to the order.
[28]Affidavit of Barsby filed 6 December 2007 Exhibit WB1.
[29]Affidavit of Davies filed 12 June 2007 Exhibit RD9.
[30]Affidavit of Davies filed 8 August 2007 Exhibit RD6.
Accordingly, an originating application was filed on 9 March 2003 and served by post under cover of a letter of the same date together with a draft order and a form of consent in writing. On 18 March 2004 the solicitors for the second defendant signed the consent in writing to an order by the registrar that the applicant be given leave to bring proceedings against the first and second respondents in respect of the applicant’s claim for damages for personal injury arising out of a motor vehicle accident “pursuant to s 39(5)(c)(ii) of” the Act.[31] The compulsory conference required by s 51A(1) and the obligation to exchange written final offers under s 51C(1) of the Act were dispensed with, and the usual regime for a substitute conference and written final offers made conditions of the order. The order purported to provide that subsections 51C(9) and (10) and s 55F of the Act applied to each of the final offers referred to in the conditions; it seems to me that the court has no power to extend the operation of a statute in this way, even with the consent of the parties, and that this part of the order was ineffective.
[31]Affidavit of Davies filed 12 June 2007 Exhibit RD10.
It is not clear why an order was made under s 39(5). It seemed to me that, subject to the question of whether there was a “motor vehicle accident” for the purposes of the Act, proper notice had been given by the plaintiff of that accident as required by s 37, and in any case the second defendant had conceded that the notice was compliant. In these circumstances, it is difficult to see why there was any need to permit further proceedings based on the claim despite non‑compliance. In any event, an order under subsection (5) can only be made on application by a claimant, that is a person making a motor vehicle accident claim for the purposes of the Act, and it refers to proceedings on a claim, which means a motor vehicle accident claim for the purposes of the Act, so no such order was appropriate unless the plaintiff’s claim was a motor vehicle accident claim for the purposes of the Act.
The requirement in s 51A(1) for a compulsory conference is only a restriction on a claimant seeking to bring an action for damages for personal injury arising out of a motor vehicle accident, and a requirement to give a “mandatory final offer” applies only to a “motor vehicle accident claim”: s 51C(1). The conditions contained references to ss 45(1), 45(2)(b), and 46A of the Act which would only have been applicable if the plaintiff were a claimant for the purposes of the Act. The second defendant could be properly involved in this proceeding only if it was liable under the Act to satisfy the plaintiff’s claim against the first defendant. Overall, it seems to me that by consenting to this order the second defendant was contributing to the persistence of a common assumption between the parties that the Act applied, and that the second defendant was liable to indemnify the first defendant in respect of any liability of the first defendant to the plaintiff as a result of the first defendant’s breach of duty to the plaintiff. As a consequence of the second defendant’s solicitors’ execution of that consent, the plaintiff’s solicitors filed the consent in court as a result of which an order was made by a deputy registrar in accordance with the consent on 19 March 2004.[32]
[32]BD876 of 2004 document 6.
During argument I raised the question of whether the making of this order gave rise to a res judicata or issue estoppel as to the proposition that the plaintiff’s claim in the present action, brought pursuant to that order, was a motor vehicle accident claim for the purposes of the Act and hence within the scope of the second defendant’s statutory policy. However, reliance on that proposition was expressly disavowed by senior counsel for the plaintiff,[33] and in these circumstances it is unnecessary for me to say anything on that point.
[33]Page 62.
Because that consent order had been made, the solicitors for the plaintiff began the present action by filing a claim and statement of claim against both defendants on 23 March 2004, which was served on the solicitors for the second defendant under cover of a letter from the solicitors for the plaintiff of 25 March 2004. On 29 March 2004 receipt of this was acknowledged by the solicitors for the second defendant, who advised that they intended to withhold the filing and serving of a defence until settlement negotiations had been exhausted and the compulsory conference had taken place.[34] The limitation period expired on 2 April 2004. At that stage, there had been no suggestion from the second defendant that because of the exclusion in the statutory policy it was not liable to indemnify the first defendant in respect of any liability to the plaintiff in the action.
[34]Affidavit of Davies filed 8 August 2007 Exhibit RD6.
On 28 July 2004 the conference contemplated by the order of the registrar was held, but settlement was not achieved.[35] Written final offers as contemplated by that order were exchanged by the parties.[36] A notice of intention to defend and a defence on behalf of the defendants were filed by the solicitors for the second defendant on 6 October 2004; that defence in paragraph 1 admitted the allegation in paragraph 4 of the statement of claim that the first defendant “is an insured person under the terms defined in” the Act. The relevant definition of “insured person” in s 4 of the Act was “a person who is insured under a CTP insurance policy …”. A CTP insurance policy means, of course, a policy of insurance under the Act; although the first defendant was the insured under a CTP insurance policy, it was not insured under such a policy in respect of any liability to the plaintiff on the basis claimed. Furthermore, the defendants admitted paragraph 5, the allegation that “the second defendant is joined in this action pursuant to s 52 of the said Act”. Section 52 applied only if an action was brought for damages for personal injury arising out of a motor vehicle accident: subsection (1).
[35]Affidavit of Barsby filed 12 June 2007 para 23.
[36]The substance of these offers appeared in the material before me: Affidavit of Davies filed 8 August 2007 Exhibit RD6. I am not sure why I was told the actual offers made, which does not seem to be of any particular relevance, although I suppose the fact that the second defendant was continuing to act on the basis that the plaintiff’s claim was a claim for the purposes of the Act might be of some peripheral relevance to what I have to decide; the practical effect is that if this matter ever does get to a trial it cannot be heard by me.
The defence also admitted the allegation in para 16 of the statement of claim that the plaintiff had complied with the WorkCover Queensland Act 1996. That was a somewhat curious admission, in circumstances where, if the Act did not apply, or more precisely, if the Act did not impose an obligation on the first defendant to have insurance in respect of the liability to the plaintiff alleged in the claim and statement of claim, there was a good deal in the WorkCover Queensland Act 1996 which prevented the plaintiff from taking proceedings in a court against the first defendant. The plaintiff had not given a notice under s 280 of that Act to WorkCover, there had not been a compulsory conference as contemplated by s 293 of that Act, the requirements of s 303 of that Act had not been satisfied, and the court had not under s 305 given leave to bring proceedings notwithstanding non‑compliance with s 280.[37] In these circumstances, the plaintiff was able to bring the present action against the first defendant only if the plaintiff’s claim was in respect of a liability to pay damages for personal injury which was within the scope of the cover provided by a policy under the Act.
[37]Bonser v Melnacis [2002] 1 Qd R 1.
No doubt in practice the admission of the allegation that the requirements of the WorkCover Queensland Act 1996 had been complied with occurred on the instructions of the second defendant, rather than the first defendant. The authority of the second defendant to make that admission on behalf of the first defendant was itself dependent upon the liability of the first defendant to the plaintiff being one covered by the second defendant’s statutory policy of insurance: s 44. The admission was not one which was otherwise binding on the first defendant, or for that matter on WorkCover: s 44(3).
There was nothing in the defence at that time to suggest any liability of the first defendant to the plaintiff in respect that the plaintiff’s claim was not recoverable from the second defendant pursuant to the Act. The defence asserted that the truck was roadworthy at the time of the collision, and that the collision was caused by or contributed to by the negligence of the plaintiff in, among other things, overloading the truck.
So far as the material before me discloses, the next matter of significance was the filing and service of an amended defence of the defendants on 19 August 2005. The amended defence purported to withdraw the admissions of paragraphs 4 and 5 of the statement of claim,[38] included a reference to clause 3(2) of the policy, alleged that that clause applied, and alleged that if the first defendant were liable to pay damages for the injury to the plaintiff the first defendant was not insured under the second defendant’s policy in respect of that liability, and the second defendant should not be a party to the proceeding. That was followed by a reply, which alleged estoppel or waiver. Mediation took place on 18 July 2006 but the matter was not settled.[39] On 24 July 2006 the plaintiff accepted the lump sum offer of compensation offered some time earlier. Last year I gave leave to amend the claim and statement of claim, which was done and the pleadings were put into what is now their current form. After some further delay in finding a date convenient to all parties, the preliminary questions were argued before me on 10 December 2007.
[38]So far as I can see, leave to withdraw these admissions was never obtained.
[39]Affidavit of Davies filed 12 June 2007 para 30.
Authorities on estoppel
I referred earlier to the decision of Commonwealth v Verwayen (supra) and to the judgment of Deane J. At pages 443‑446 a general doctrine of estoppel by conduct was expounded in a passage which is really too long conveniently to quote here, but I will mention a number of matters which I think are significant for the resolution of the present case. It was said that the party in the position of the present second defendant “must have played such a part in the adoption of, or persistence in, the assumption that he would be guilty of unjust and oppressive conduct if he were now to depart from it.” Four main but not exhaustive categories were identified by his Honour, including where the party sought to be estopped had “entered into contractual or other material relations with the other party on the conventional basis of the assumption” and “has exercised against the other party rights which would exist only if the assumption were correct.” His Honour pointed out, however, that ultimately the question of whether departure from the assumption would be unconscionable had to be resolved by reference to all the circumstances of the case, including the reasonableness of the conduct of the other party, and the nature and extent of the detriment he would sustain if departure from the assumed state of affairs were permitted.
It was pointed out that the assumption may be of fact or law, present or future, including the existence of a legal right. The assumed state of affairs may be used aggressively as the factual foundation of an action arising under ordinary principles with the entitlement of ultimate relief being determined on the basis of the existence of that state of affairs. “In some cases, the estoppel may operate to fashion an assumed state of affairs which will found relief (under ordinary principles) which gives effect to the assumption itself (eg where the defendant in an action for a declaration of trust is estopped from denying the existence of the trust).”[40]
[40]It is therefore not an answer that the liability of the second defendant is part of the plaintiff’s cause of action under the Act, as held in De Innocentis v Brisbane City Council [2000] 2 Qd R 349 at [19].
That this approach to the question of estoppel was wider than the traditional notion of estoppel in relation to an issue of fact emerged as well from the judgment of Mason CJ in the same decision.[41] His Honour discussed estoppel from p 409, and concluded at p 413 that:
“It should be accepted that there is but one doctrine of estoppel, which provides that a court of common law or equity may do what is required, but no more, to prevent a person who has relied upon an assumption as to a present, past or future state of affairs (including a legal state of affairs), which assumption the party estopped has induced him to hold, from suffering detriment in reliance upon the assumption as a result of the denial of its correctness. A central element of that doctrine is that there must be a proportionality between the remedy and the detriment which is its purpose to avoid. … The assumption may be one as to a legal as well as one to a factual state of affairs. There is simply no reason to restrict the assumption to a factual matter as there was at the time when the rules of estoppel by conduct were evidentiary.”
[41]Mason CJ dissented in that case, not as to the question of when an estoppel would arise, and whether it did arise in that case, but considered that in the circumstances of that case the detriment to the plaintiff from allowing the defendant to depart from the assumed state of affairs would be able to be met by an order for costs, so that the estoppel did prevent the defendant from raising the limitation defence.
In the light of these passages it is necessary to treat with some caution some references in the earlier judgment of McPherson J in Wilson v Austral Motors (Qld) Pty Ltd [1983] 2 Qd R 774 at 782. His Honour there recognised that an estoppel could arise against the Workers’ Compensation Board of Queensland. His Honour referred to earlier decisions, which established:
“that it is possible for the Board by its conduct to estop itself from asserting that, in terms of the Act, it is not liable to the defendant, or perhaps to a plaintiff who may have been led by the representations of the Board to act on the assumption that the Board has accepted liability to indemnify, and so may have refrained, until it is too late, from serving or otherwise pursuing the licensed insurer under the Motor Vehicles Insurance Act. Although an estoppel may not be raised in the face of a statute, there remains within the limits of those statutory provisions an area of fact, as to which the doctrine of estoppel may apply; for example, the Board may be estopped from asserting facts which show that the person injured was not a ‘worker’ within s 9A read with the terms of the definition in s 3 of the Workers’ Compensation Act; or that the injury fell within the exception in s 9A(1) because it was caused ‘by, through or in connection with’ an insured motor vehicle within s 3(1) of the Motor Vehicle Insurance Act.”
It seems to me that in the light of the statements made in Verwayen, that approach should not be seen as confined strictly to matters of fact. Subject to that point, however, what was said by his Honour about the liability of the Board under the Workers’ Compensation Act applies to the liability of a licensed insurer under the Act. One of the cases referred to by his Honour was Northern Assurance Co Ltd v Cooper [1968] Qd R 46, where it was held that a licensed insurer under the Motor Vehicles Insurance Act was estopped as against the insured from asserting that it was not liable to indemnify the insured, in circumstances where it had assumed the conduct of proceedings in respect of a claim against the insured and expose the insured to an order for costs. In that case, the insurer’s position was that what had happened in that case was not one of the risks which was insured against: p 51. Under the policy, the insurer was entitled to act on behalf of the insured in legal proceedings but only in respect of anything indemnified under the policy. Accordingly, by acting on his behalf in the legal proceedings “the company was representing to him in the clearest possible terms that that proceeding was a proceeding in respect of something indemnified under the policy, and therefore that the company was obliged to indemnify him against any possible liability to which he might be subject in the … proceedings” (p 52).
The policy issued by a licensed insurer under the Motor Vehicles Insurance Act was also required to be in a statutory form: p 49. If an insurer can be estopped as to whether cover is provided by the policy in that case, it does not seem to me that in principle the proposition that there can be no estoppel against a statute means that an estoppel is necessarily excluded in this case. There is nothing in the statute which says that the licensed insurer is not to indemnify the insured, or pay the plaintiff’s claim; the position is simply that under the terms of the statutory policy the licensed insurer on the face of it has an exclusion available to it on which it is entitled to rely to deny liability. But if an estoppel prevents it from relying on that exclusion, then the statute operates in the same way as it would operate with any other claim arising in circumstances where cover under the Act applies.
In Wilson (supra) the Workers’ Compensation Board filed an election to be joined as a defendant, something the Board was entitled to do only where there was a claim against the employer for damages in respect of a liability where the worker, if successful, was entitled to receive payment out of the Workers’ Compensation Fund. In that case the Board, having elected to be joined, brought a third party proceeding against the licensed insurer of the vehicle involved, claiming a declaration that that insurer was liable to indemnify the defendant in respect of any damages suffered by the plaintiff. The plaintiff had been injured when he fell from the tray of the insured truck while he was engaged in loading it in the course of his employment, and it was held that the injury he had sustained was caused by, through or in connection with the vehicle. Ultimately, judgment was given for the plaintiff against the defendant and the declaration was made that the licensed insurer was liable to indemnify the defendant. An argument that the Board was bound by an estoppel in favour of the licensed insurer was rejected on the basis that the insurer had suffered no detriment as a result of the actions of the Board.
The effect of an election was also considered by the Full Court in Boath v Central Queensland Meat Export Co Pty Ltd and Anor [1986] 1 Qd R 139. The plaintiff was driving an insured truck across a bridge situated on the defendant’s property when the bridge collapsed, causing the plaintiff to suffer personal injuries when he struck his shoulder and side against the door of the truck. He brought an action against the defendant claiming damages for negligence and served a copy of the writ on the licensed insurer as required under the Motor Vehicles Insurance Act 1936. The licensed insurer elected to be joined as a defendant. At the trial the defendant was also represented, and sought to argue that it was entitled to be indemnified by the licensed insurer. It was held on appeal that subject to the effect of the election the insurer was not liable, on the ground that any damages the plaintiff was entitled to recover were not damages in respect of the truck.
As to the effect of the election, it was held that there was no estoppel because there was no material to suggest that any party was unaware that at all material times the licensed insurer denied that it was in fact liable under the policy of insurance, and that the election had been made specifically in order to argue that liability. Matthews J held that the insurer acted without statutory warrant when it elected to be joined, but that in the circumstances its action had caused no significant consequences and no prejudice.
Carter J in the course of considering the question of estoppel said at p 152:
“The insurer may so act in the litigation as to be estopped from denying its liability to indemnify but if either before or after election and if in all the circumstances it so acts vis-à-vis the defendant in a manner consistent only with a denial of its liability to indemnify, the election, albeit only to raise the issue for determination, cannot prevent the defendant by election from having that issue determined. … (p 153) … The act of election taken with other acts of the insurer in relation to the litigation might be such that the law will prevent the insurer from later seeking to deny its liability but that will be so not because of the provisions of the regulations but because of the doctrine of estoppel.”
Overall I accept that the conduct complained of did occur in circumstances where the second defendant was engaged in trade or commence for the purposes of s 52. Accordingly, question (c) is answered “yes in respect of all of the second defendant’s pleaded conduct.”
Question (d)
The second defendant is obviously a corporation for the purposes of the Trade Practices Act, and accordingly the question of whether it was in breach of s 52 depends on whether it engaged in conduct that was misleading or deceptive or was likely to mislead or deceive. It was submitted on behalf of the second defendant the conduct was neither misleading nor deceptive nor likely to mislead or deceive, because at no stage was there any statement by the second defendant to the effect that if grounds to resist the claim arose they would not be available. That is true, but I think it is not to the point.
Certainly the second defendant was making it clear that if the matter was not resolved the second defendant would if the occasion arose rely on the Limitation of Actions Act, and that if the matter went to court it would be necessary for the plaintiff to prove his case. But those I think are separate issues from the question of whether the claim against the first defendant was one which, to the extent that it was a good one, it was the responsibility of the second defendant to satisfy under the Act. That was the relevant issue, and that was an issue which did not depend on a ground arising in the future; it depended on matters which were already as well known to the second defendant, from the notice of claim, and ultimately from the statement of claim,[66] as to the plaintiff. This was a claim which the second defendant could have rejected at the outset. But the second defendant did not do so, and continued to behave as if it were liable on the claim, in the way I have already indicated. The question then is whether that was misleading or deceptive or likely to mislead or deceive.
[66]If not as well from its own investigations, as to which I have no evidence.
The question is concerned with the pleaded conduct of the second defendant. The allegation of breach of s 52 in the amended statement of claim in paragraph 10T referred to the second defendant’s conduct as defined in paragraph 10R, which identified the conduct pleaded in paragraphs 10F to 10N as having the effect of representations to the plaintiff that the compulsory third party insurance policy in respect of the truck did respond to the plaintiff’s claim, that the second defendant was liable for damages at common law proved by the plaintiff against the first defendant in respect of the collision, and that the second defendant was so liable as such compulsory third party insurer.
The conduct identified in paragraphs 10F to 10N comprised the following:[67]
[67]The other paragraphs did not allege conduct of the second defendant.
A Paragraph 10F – the letter of 30 October 2001 from the second defendant referred to in paragraph [23] above.
B Paragraph 10H – the letter of 25 February 2005 from the second defendant referred to in paragraph [24] above.
C Paragraph 10I – between February 2002 and August 2003, securing the agreement of the plaintiff to a medical examination in respect of his injuries, and obtaining a report from a doctor in respect of the same.
D Paragraph 10J – the letter of 18 September 2003 from the second defendant referred to in paragraph [33] above.
E Paragraph 10L – the letter of 26 September 2003 from the second defendant’s solicitors, referred to in paragraph [54] above.
F Paragraph 10N – consenting on 18 March 2004 to the order giving leave to bring a proceeding in this court in respect of the collision and dispensing with various provisions of the Act, referred to in paragraph [36] above.
I have already referred earlier to the effect that these various communications and other Acts of the second defendant had, in terms of the operation of the Act. It follows from what I have said earlier that in my opinion the combined effect of that conduct was to represent that the compulsory third party insurance policy issued by the second defendant to the first defendant in respect of the vehicle involved in the incident the subject of the plaintiff’s claim did respond to the plaintiff’s claim, that the second defendant was liable for any damages proved by the plaintiff against the first defendant in respect of the collision involving the truck, and that the second defendant was so liable as the compulsory third party insurer under the Act of the first defendant. These are all just aspects of the broader proposition, that the second defendant was responsible for satisfying the plaintiff’s claim for damages from the first defendant, to the extent that it was a good claim, referred to earlier. The question then is whether that was misleading or deceptive.
That was a representation as to a present existing state of affairs, and not a representation as to the state of mind of the second defendant. Whether the second defendant was responsible for satisfying the plaintiff’s claim, if any, was something which depended upon the circumstances of the claim and the terms of the policy. Both of those were matters of historical fact as at the time when all of that conduct occurred. Whether conduct is misleading or deceptive does not depend on the intention of the corporation,[68] and conduct can be misleading or deceptive even if the corporation has taken great care to avoid that consequence.[69]
[68]Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 at 223.
[69]Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 140 CLR 191 at 197.
The submissions on behalf of the second defendant conceded that a representation as to a matter of law may be misleading or deceptive if it is not correct, although it was submitted that this applied only if it was made known to the corporation that the recipient of the representation relied upon the expertise of the corporation.[70] That is a separate question from the question of whether a representation as to a legal position can amount to misleading or deceptive conduct; it is concerned with the question of causation for the purposes of s 82, not the question of whether there has been a breach of s 52 of the Act. It is sufficient in my opinion if the representations made were intended by the second defendant to be acted on, and it was reasonable for the plaintiff to have acted on them. Until August 2005 the second defendant was, objectively, behaving as it if intended the plaintiff to treat it as the insurer responsible for the plaintiff’s claim, and it was reasonable for the plaintiff to do so, as I have found. It is also not to the point that the person misled had been careless or could have discovered the misrepresentation for himself.[71] Under the Trade Practices Act as it stood at the relevant time contributory negligence was not a defence, or even a matter which gave rise to a reduction in damages.
[70]Based on the reasons in SKF Hoists (supra) at 51,607‑8.
[71]Henville v Walker [2001] HCA 52 [140], [165]; 206 CLR 459.
For practical purposes, in a context such as the present, a representation will be misleading if it is incorrect.[72] If the representation was made, as I have found, that the second defendant was responsible for satisfying the plaintiff’s claim for damages, then as I have already concluded the representation was incorrect. The real issue is whether that representation was made by the second defendant’s conduct, and I have already decided that point against the second defendant. Once it is concluded that the representation was made, it seems to me, with respect, that the representation was obviously misleading or deceptive. Accordingly, the answer to question (d) is “yes”.
[72]SKF Hoists (supra) at pp 51,606‑8.
Question (e)
The second defendant also submitted that the issue of reliance had not been made out sufficiently to found a cause of action in damages. This is certainly one matter which has to be decided in order to answer question (e), but it is also necessary I think to determine whether the plaintiff has suffered any loss or damage. That depends on whether the second defendant is now entitled to take the point, or rather whether it can now be taken successfully, about the absence of cover. If the second defendant is estopped, as I have found, from now asserting that it is not responsible for satisfying the plaintiff’s claim against the first defendant, the consequence will be that the plaintiff has not suffered loss or damage in the form of the loss of his claim. That was the loss pleaded as having been suffered in paragraph 10V of the amended statement of claim. Apart from the loss of his claim, there would I expect have been some additional legal costs incurred by the plaintiff as a result of this point having been raised. However, in principle the ordinary jurisdiction of the court in relation to costs would be sufficient to enable the plaintiff to avoid the costs of a point which has been raised unsuccessfully, though I suppose in practice a loss will be suffered if costs are incurred which are not fully recovered.
It follows that for present purposes, it the light of the answer I would give to question (b)(i) above, the short answer to question (e) is “no”, because the plaintiff has not lost the benefit of the damages which would otherwise have been recoverable from the second defendant pursuant to the Act, the loss relies on in the pleading. This, however, depends upon the proposition that the plaintiff’s claim for estoppel against the second defendant is made out. In case a different view on that may be taken elsewhere, I should make a precautionary finding in relation to the question of reliance, given that I have heard argument on it.
Strictly speaking, what is required is that the plaintiff has suffered damages “by” conduct in breach of s 52. This clearly expresses a notion of causation, so that the real question is whether the loss of the plaintiff satisfies a practical or commonsense concept of causation: Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 525; Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592 at [37]. For practical purposes, however, it is necessary and sufficient for the person in the position of the plaintiff to show that he has been influenced to do or refrain from doing something giving rise to damage by the conduct contravening s 52: Kabwand Pty Ltd v National Australia Bank Ltd (1989) 11 ATPR 40‑950 at 50,378.
It is also well established that it is not necessary for the breach of s 52 to be the only cause of the plaintiff’s loss, so long as it was a cause of that loss.[73] Prior to amendments introducing proportional liability, which occurred after the time when any cause of action by the plaintiff against the second defendant arose, the existence of other contributing causes did not give rise to any reduction of the liability of a defendant in breach of s 52: I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109.
[73]I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd [2002] HCA 41, (2002) 210 CLR 109.
Accordingly it is not to the point to say that the plaintiff in the immediate sense was relying on his solicitors, and that, having placed the matter in the hands of the solicitors, he left them to it, trusting them to do what was appropriate to protect his interest.[74] For practical purposes, of course, the various communications and other conduct on the part of the second defendant came to the plaintiff’s solicitors rather than the plaintiff personally, but for the purpose of s 82 it is necessary to determine whether the plaintiff suffered a loss by the conduct of the second defendant.
[74]For the same reason, it does not matter if the plaintiff’s lawyers were negligence, and that negligence was also a cause of the plaintiff’s loss: see eg Travel Compensation Fund v Tambree (2005) 80 ALJR 183, where separate claims of negligence and misleading and deceptive conduct succeeded against accountants who prepared defective financial statements, and auditors who audited them.
There may be some analogy in determining the question of causation with a situation where the relevant misleading or deceptive conduct amounts to non‑disclosure of matters which there was a duty to disclose, or where, in the light of such statements as were made, the non‑disclosure of other relevant matters made the overall conduct of the defendant misleading or deceptive. In such cases, the loss is commonly claimed as arising because the plaintiff did something which it would not have done if the relevant information had been disclosed. In such circumstances, the plaintiff may be entitled to relief under s 87 of the Act from the transaction entered into, or, if that is not sought or is not appropriate, damages under s 82 if the plaintiff is worse off as a result of entering into the transaction than if it had not done so. In such circumstances the plaintiff proves causation by proving that it would have acted differently if things had been different in the relevant respect.
In my opinion the position is the same here; if at the relevant time the second defendant had refrained from proceeding on the basis that the policy applied to the plaintiff’s claim, it would have either denied liability on the basis the policy did not cover it, or at least have indicated that it was keeping that issue open pending further investigations. When a claim is made, the insurer can really do only one of three things: proceed on the basis that there is liability, proceed on the basis that there is not liability, or proceed on the basis that there might or might not be liability. The effect of the evidence of the solicitors to which I have already referred is that, had the second defendant proceeded on the second or third of those bases, they would have sought instructions from the plaintiff to take the appropriate steps to preserve the claim under the WorkCover Queensland Act, on a precautionary basis. I have already said I accept that evidence, and that I also accept the evidence of the plaintiff that, had he received that recommendation, he would have given those instructions. I find that if that situation had arisen, that those steps would have been taken and the plaintiff’s claim would have been preserved under the WorkCover Queensland Act. For practical purposes, the opportunity to pursue the claim in that way came to an end once the limitation period expired.
It was not submitted on behalf of the second defendant that the present action, as an action against the first defendant, was effective to preserve the plaintiff’s right against the first defendant under the WorkCover Queensland Act. As I have already indicated, in fact the plaintiff had not complied with the various requirements of that Act prior to commencing a proceeding against the first defendant if that Act applied. The received view in Queensland at the time was that the effect of that Act was that those proceedings were a nullity.[75] The High Court has subsequently shown,[76] and the Court of Appeal has subsequently accepted,[77] that that view was not correct, but, even if the effect of the decision in Phipps (supra) was that it was not necessarily impossible for the plaintiff to turn the current action, as an action against the first defendant, into an action within the WorkCover Queensland Act (prior to the election to accept the lump sum compensation) the process would certainly have been difficult and of most uncertain outcome.
[75]Roberts v Australia and New Zealand Banking Group Ltd [2006] 1 Qd R 482.
[76]Berowra Holdings Pty Ltd v Gordon (2006) 225 CLR 364.
[77]Phipps v Australian Leisure and Hospitality Group Ltd [2007] QCA 130.
Since I am not concerned with the present case to make any assessment of the value of the plaintiff’s loss for the purpose of s 82, it is unnecessary to determine whether the plaintiff has lost the whole of his claim, or only the value of his claim less some allowance for the chance of being able successfully to pursue that claim in the present action if the lump sum compensation had not been accepted. On either basis the plaintiff would have certainly suffered loss for the purposes of s 82, which is what matters at the moment. In all the circumstances, I am satisfied on the balance of probabilities that, if the relevant misleading and deceptive conduct had not occurred, the plaintiff would have acted differently, and that, because of that difference, the plaintiff has suffered loss “by” that misleading and deceptive conduct.
In these circumstances, had I not found the second defendant estopped from disputing that it is responsible for satisfying the plaintiff’s claim, to the extent that it is a good one, I would have answered question (e) “yes”.
Conclusion
I therefore order that the following questions be decided separately from all of the questions in these proceedings, and answer them as follows:
(a) Is the claim made by the plaintiff in these proceedings a “motor vehicle accident claim” as that term is defined in s 4 of the Motor Accident Insurance Act1994 (Qld)?
Answer: No.
(b) If the answer to (a) is in the negative:
(i) Is the second defendant estopped or precluded, and if so to what extent, from contending that:
(A) the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as that term is defined in the Motor Accident Insurance Act; or,
(B) it is not liable to pay such claim, if adjudicated in the plaintiff’s favour, as if it were “a motor vehicle accident claim” as so defined?
Answer: Yes in respect of both (A) and (B).
(ii) Has the second defendant waived any right it may have had to contend that the plaintiff’s claim in these proceedings is not a “motor vehicle accident claim” as so defined?
Answer: No.
(c) Do the provisions of s 52 of the Trade Practices Act 1974 (Cth) apply to any or all of the second defendant’s pleaded conduct in these proceedings?
Answer: Yes.
(d) If yes to (c), by any of the pleaded conduct to which it is applicable, by engaging in such conduct, did the second defendant contravene s 52 of the Trade Practices Act?
Answer: Yes.
(e) If yes to (d), has the plaintiff suffered loss and damage by such contravening conduct, pursuant to s 82 of the Trade Practices Act?
Answer: No.
In accordance with the agreement of the parties, I order that the costs of the plaintiff and the second defendant of and incidental to the determination of these questions be each party’s costs in the cause.
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