Scuttle Clothing v Freylinder

[2006] NSWDC 10

CITATION:	Scuttle Clothing v Freylinder [2006] NSWDC 10
HEARING DATE(S):	11 September 2006
JUDGMENT DATE:	13 September 2006
JURISDICTION:	District Court
JUDGMENT OF:	Williams DCJ at 1
DECISION:	Section 142 of the Motor Accidents Act 1999 precludes an action for the loss of the services of an employee arising out of a motor accident.
CATCHWORDS:	Motor accident - employee - loss of services
LEGISLATION CITED:	Motor Accidents Compensation Act 1999 Interpretation Act 1987
CASES CITED:	Kenbrad Pty Ltd v Vakauta 2001 NSWCA 204 GIO Australia v Robson 1997 42 NSWLR 439 Marinivski v Zutti Pty Ltd 1984 2 NSWLR 571
PARTIES:	Scuttle Clothing Pty Ltd Freylinder & anor Freylinder & anor
FILE NUMBER(S):	1756 of 2006
COUNSEL:	M White for Plaintiff N Chen for Defendants
SOLICITORS:	Manion McCosker Turkslegal

BACKGROUND:-
1. On 5 March 2003 Evette Mansour was injured in a car accident on her way to work. That accident is said to have been caused by the negligent driving of Mr Freylinder who was driving a vehicle owned by ISS Hygiene & Services Pty Limited. As such this accident is one that would be covered by the Motor Accidents Compensations Act 1999 (MACA).

THE ISSUE:-
2. What is unusual about the motions before me is that the plaintiff in this action is not Ms Mansour but her employer, who sues the defendants for the loss of her services, in accordance with the old cause of action referred to as an action per quod servitium amisit. In effect the motions seek a resolution of whether or not the plaintiff’s cause of action is maintainable having regard to s142 of the MACA.

THE LAW:-
3. Section 142 is in these terms. Subsection 1: “No damages for the loss of services of a person are to be awarded in respect of a motor accident”. Subsections 2 and 3 exempt Compensation to Relative’s actions from the operation of ss1, although ss3 applies the provisions of s128 ss(3)-(7) of the MACA to such claims as far as they involve attendant care services. Section 142 was added to the Act in 1999.

HISTORY:-
4. Initially the draft bill for the amendment did not contain ss(2) and (3) of the current s142 (see the Motor Accidents Compensation Bill 1999 cl 139 first print). However, a later re-write, the third print, did include those two subsections.

5. Both parties agree that the plaintiff’s cause of action is an action per quod servitium amisit, for the loss of the services of its employee Miss Mansour. The quantum of the plaintiff’s claim in these proceedings relates to:
(a) the wages it paid to Miss Mansour ($73,980.00);
(b) superannuation, payroll tax, Work Cover contributions and accrued annual leave ($19,006.00); and
(c) travel expenses and the cost of employing additional staff ($20,667.65).

6. Mr Chen for the defendants suggests that the wording of s142 is quite clear and the section precludes the recovery of damages for an action for loss of such services.

7. Mr White argues that having regard to the purposes of the Act, some decided cases and principles of statutory interpretation, the action is able to be maintained and that the meaning of the section is not entirely clear.

8. Section 142 has not been directly considered by any appellate court. Hodgson JA in Kenbrad Pty Limited v. Vakauta said in a passing reference, that s142 of the MACA abolished actions for loss of services of this nature (2001 NSWCA 204 paragraph 6). His Honour was considering the applicability of such a cause of action under the old Motor Accidents Act 1988 in regard to the 1998 amendments. His Honour’s comment would therefore not be regarded as being part of the reasons for decision of that case.

9. In GIO Australia v. Robson 1997 42 NSWLR 439 at 444, Stein JA declined to rule that an action for loss of services could no longer be recognised.

10. In Marinovski v. Zutti Pty Limited and Ors 1984 2 NSWLR 571, Hutly JA considered the range of damages that might be the subject of a claim for loss of services by an employer in regard to an employee. They are set out at pages 573G, 574 and 575. I do not need to refer to what was said by his Honour in those pages except to say that the nature of such claims and the types of damage referred to, could be related to the present claim. The types of damage are also referred to in Luntz, Assessment of Damages for Personal Injury and Death, 4th edition 2002 at page 570 s10.3.1.

11. The only apparent commentary on s142 is that to be found at page 2999/18 of Goudkamp & Morrison’s loose-leaf practice published by the Law Book Company. The authors feel that s142 does not sit well with s128. They correctly point out that the word “services” is not defined. They also say that the expression “the loss of the services of a person” is so vague that there is a range of possible interpretations. However, their commentary is really concerned:
(a) with the type of services that might have been rendered by an injured person to another, for example a child, and
(b) the provision to that injured person of paid or gratuitous services by someone else.

The authors suggest that the proper interpretation of the section, having regard to s128 of the Act and having regard to the legislative exclusion of Compensation to Relatives (CTR) claims from the operation of s142, is to exclude the former but to allow the latter to remain unaffected,

INTERPRETATION ISSUES:-
12. Mr White made a detailed submission on how such provisions might be interpreted having regard to s33 and s34 of the Interpretation Act and the decided cases in the literature.

13. What is not disputed is that there is no mention of s142 in the Minister’s second reading speech of 3 June 1999. However, in committee on the amendment bill referred to above, the Minister on 29 June 1999 said of the then clause 139 of the first print of the bill, that it was intended to abolish claims by employers for the loss of services of an employee if that employee had been the victim of a motor accident. He went on to foreshadow the further amendments to that clause which then appeared in the third print of the bill and which were designed to protect rights under CTR claims.

14. There was some earlier discussion of the effect of clause 139 in committee on 28 June 1999 (see page 1511 of Hansard) but I don’t find that discussion helpful in any way in resolving the issue before me.

15. Section 34 of the Interpretation Act allows a court to look at a wide variety of material to assist it to interpret a statute where:

(a) the meaning of the statute needs to be confirmed, or

(b) to determine the meaning of

(i) An ambiguous or obscure provision, or

(ii) A provision in which, if the ordinary meaning was applied, that would lead to a manifestly absurd or unreasonable result.

16. What the cases referred to by the authors of Statutory Interpretation in Australia, 6th edition 2006 published by Lexis Nexis, at pages 80 and 81 seem to suggest is that the court needs to follow a certain process in order to reach a result on the question of the interpretation of a statute.

17. Firstly, the court needs to determine whether or not the meaning of the provision is capable of having an ordinary meaning. If it does have an ordinary meaning then extrinsic material can only be used to confirm that meaning.

18. Secondly, the court, if it has not come to the first conclusion, must proceed to determine if the provision is either:
(a) ambiguous
(b) obscure, or
(c) on its ordinary meaning would lead to a manifestly absurd or unreasonable result.

19. In those circumstances the court can then call on extrinsic material to interpret the legislative provision.

20. I agree that if the text of the law is clear, then the second reading speech or other material cannot be used to change that clear meaning, especially where the parliament’s stated objective is to restrict the liberty of an individual but that objective is not apparent in the wording of the legislation.

21. I also accept that statutes purporting to remove existing rights, must be construed strictly and the language of the statute must be clear in its intention and in its operation.

22. The objects of the MACA are set out in s5 of the Act and in particular ss(1) (a)-(g). These objects amongst other things relate to the keeping of third party premiums affordable given that such insurance is compulsory. Subsection (2) of s5 talks of the need to keep overall costs within reasonable bounds so as to keep premiums affordable and that there is a finite pool of money available to compensate victims.

23. The statement of what a third party policy seeks to cover, as set out in s10 of the Act, has not meaningfully changed from the similar provision which was contained in s9 of the Motor Accidents Act 1988.

24. Section 128 of the MACA seeks to limit the amount of damages that can be recovered for certain attendant care services. The limiting provisions of s128 also apply to CTR claims even though those claims are exempted from the operation of s142.

RESOLUTION:-
25. Given the objects of the Act, given the clear wording of the subsection, given the ordinary meaning of the words used in the subsection and given the Minister’s statement in committee, in my view the purpose of s142 is to exclude a claim for loss of services made by a person or a company where there is no direct relationship to the injured person, except insofar as the injured person may be an employee or the like.

26. Given the objects of the Act, given the clear wording of the subsection, given the ordinary meaning of the words used in the subsection and given the Minister’s statement in committee confirming the clear words and ordinary meaning, in my view the purpose of s142 is to exclude a claim for loss of services made by a person or a company where there is no direct relationship to the injured person, except insofar as the injured person may be an employee or the like.

27. The damage sought to be recovered in the present case arose out of a “motor accident” as that is defined in the MACA. The Act limits the amount that can be claimed in respect of the loss of the services of a person as per s128. Those limitations relate directly to services provided to an injured person by someone else. It would in my view be anomalous if a third party, for example an employer, could recover in effect unrestricted damages in regard to the loss of an employee’s services when the injured employee is capped as to what he or she can receive.

28. I would therefore find that the plaintiff is prevented from bringing an action per quod servitium amisit for damages at common law for economic loss suffered by the plaintiff arising out of the motor vehicle accident on or about 5 March 2003 between a vehicle registration No. ACD 10H owned by the plaintiff and driven by Evette Mansour and a motor vehicle WDU 876 owned by the second defendant and driven by the first defendant against either of the defendants by reason of the enactment of s142 of the Motor Accidents Compensation Act 1999.