Tooth & Co Ltd v Tillyer

Tooth & Co Ltd (the applicant employer) sought special leave to appeal to the High Court of Australia from a decision of the Supreme Court of New South Wales. The dispute arose from an action commenced by Tooth & Co Ltd against Eric Tillyer (the respondent husband) seeking indemnity under section 64(b) of the Workers' Compensation Act 1926-1954 (N.S.W.). The employer had paid workers' compensation to the respondent's wife for injuries she sustained due to the respondent's alleged negligence while driving a motor vehicle.

The central legal issue before the High Court was whether section 64(b) of the Workers' Compensation Act 1926-1954 (N.S.W.) entitled an employer who had paid compensation to an injured worker to be indemnified by a third party, where the injury was caused by the negligence of that third party, and that third party was the injured worker's husband. Specifically, the court had to determine if the husband, by reason of the marital relationship, was a person against whom a "legal liability" to pay damages was created under the circumstances described.

The High Court, in refusing special leave to appeal, affirmed the decision of the Supreme Court of New South Wales. The Court reasoned that section 64(b) requires that the injury be caused under circumstances creating an actual legal liability in some person other than the employer to pay damages. In New South Wales, a wife cannot sue her husband in tort for personal injuries, except in limited circumstances relating to the protection of her separate property, which did not apply here. Therefore, no legal liability to pay damages was created in the husband, and consequently, the employer could not claim indemnity under section 64(b). The Court distinguished this situation from cases where a tortfeasor's immunity from suit might be considered procedural rather than substantive, concluding that in this instance, the absence of a cause of action meant there was no legal liability.