WorkCover Queensland v Suncorp Metway Insurance Limited
[2000] QSC 393
•3 November 2000
SUPREME COURT OF QUEENSLAND
CITATION: WorkCover Queensland v Suncorp Metway Insurance Limited [2000] QSC 393 PARTIES: WORKCOVER QUEENSLAND
(respondent/plaintiff)
v
SUNCORP METWAY INSURANCE LIMITED
ACN 075 695 966
(applicant /defendant)FILE NO/S: S5735 of 2000 DIVISION: Trial ORIGINATING COURT: Supreme Court at Brisbane
DELIVERED ON: 3 November 2000 DELIVERED AT: Brisbane HEARING DATE: 24 October 2000 JUDGE: Williams J ORDER: Application dismissed with costs. CATCHWORDS: INSURANCE – DOUBLE INSURANCE - WORKERS’ COMPENSATION INSURANCE – COMPULSORY THIRD PARTY MOTOR VEHICLE INSURANCE – application for summary judgment pursuant to r 293 UCPR – employee of firm injured whilst driving motor vehicle - firm indemnified pursuant to policy of accident insurance under Workers’ Compensation Act 1990 – registered owner of motor vehicle was individual member of firm – whether respondent entitled to equitable contribution from applicant in respect of employee’s claim – construction of s 3(1) of Motor Vehicle Insurance Act 1936 – whether there was a sufficient identity of the insured to give rise to double insurance – where the insured pursuant to policy issued under the 1936 Act was the registered owner of the motor vehicle and the insured pursuant to policy under 1990 Act was the firm – policy issued under 1990 Act indemnified individual members of firm jointly and severally such that each member was insured in his/her own right – thus there was sufficient identity of insured as between the two policies to give rise to double insurance.
Motor Vehicles Insurance Act 1936 (Qld), s 3(1)
Partnership Act 1891 (Qld), s 13, s 15
Workers’ Compensation Act 1990 (Qld), s 44(2), s 206
Uniform Civil Procedure Rules 1999 (Qld), r 293Albion Insurance Company Limited v Government Insurance Office of New South Wales (1969) 121 CLR 342, followed
Glover v Politanski (1990) 2 Qd R 41, appliedLorimer v Thatcher (1993) 2 Qd R 25, applied
COUNSEL: S C Williams QC for applicant/defendant
R J Douglas SC for respondent/plaintiffSOLICITORS: Quinlan, Miller & Treston for applicant/defendant
O’Mara Patterson & Perrier for respondent/plaintiff
WILLIAMS J: This is an application by the defendant in the action for judgment pursuant to r 293 of the Uniform Civil Procedure Rules 1999 essentially on grounds that the plaintiff’s statement of claim discloses no reasonable cause of action and/or the defendant has a defence to the proceeding.
A defence has been delivered, but the application should be considered on the basis of the facts alleged in the statement of claim; in any event the defence admits most essential allegations of fact in the statement of claim.
The following are the relevant facts for purposes of the application. Keith White and Rosemary White carried on a transport business in partnership. The partnership employed Mark Anthony Carter (“Carter”) as a truck driver. Keith White was the registered proprietor pursuant to the provisions of the Motor Vehicles Insurance Act 1936 (“1936 Act”) of a Kenworth prime mover registration No QXO-1XF, and a Barker trailer registration No QT-00JC. The applicant, Suncorp Metway Insurance Limited, was the compulsory third party insurer of that prime mover and trailer pursuant to the provisions of that Act. Both the prime mover and trailer were used in the course of the partnership business of the Whites.
On 13 December 1993 Carter was, in the course of his employment by the partnership of the Whites, driving the prime mover to which was attached the trailer. The load on the trailer shifted whilst on Boonah Road, Boonah, and in consequence the prime mover and trailer overturned. In consequence of that incident Carter sustained personal injuries. Further, the cause of the accident, and thus the cause of Carter’s injuries, was breach by Carter’s employer, the partnership of the Whites; the partnership was negligent and in breach of implied terms of Carter’s contract of employment. The particulars of negligence and breach of duty were concerned with the way in which the trailer was loaded.
In consequence of that accident Carter sued his employers, the partnership of the Whites; the action was No 6492 of 1996 in the Brisbane Registry of the Supreme Court. The respondent, WorkCover Queensland, assumed carriage of the defence of Carter’s proceedings. That action was compromised on 30 November 1999 by a payment to Carter of $632,183.67, being a sum inclusive of no fault compensation benefits previously paid to Carter in the sum of $82,183.67, plus costs which were subsequently agreed in the sum of $40,000. That compromise was a reasonable one.
The respondent indemnified the partnership of the Whites with respect to Carter’s claim because there existed a policy of “accident insurance” pursuant to the Workers’ Compensation Act 1990 (“1990 Act”) between the respondent and the partnership of the Whites. The liability of the partnership to Carter in consequence of the aforesaid accident and consequential injury was a liability with respect to which the partnership was entitled to indemnity under the 1990 Act policy.
The statement of claim herein also alleges that the injury suffered by Carter was:
(i)a consequence of, inter alia, the driving of the prime mover and/or trailer;
(ii)caused by, through or in connection with the prime mover and/or trailer; and
(iii) in respect of the prime mover and/or trailer.
It is then alleged that by reason of those facts the partnership, or alternatively Keith White alone, was entitled to indemnity from the applicant in respect of a liability to pay Carter damages pursuant to the 1936 Act. On that basis it was asserted that the applicant was a co-insurer in respect of the liability to Carter for the injuries he sustained and in consequence the respondent was entitled to equitable contribution from the applicant to the extent of one half of the amount of damages paid.
It is the contention of the applicant that on those facts, given the relevant provisions of the 1936 Act and the 1990 Act, the respondent is not entitled to contribution by reason of co-insurance.
The critical provision in the 1936 Act is s 3(1) which provides [I have included the reference to the 1990 Act in lieu of the reference to the Workers’ Compensation Act 1916-1988 by virtue of the operation of s 206 of the 1990 Act]:
“3. (1) Subject to this Act, the owner of any motor vehicle shall at all times during the registration, or as the case may be, any renewal of the registration of such motor vehicle indemnify and keep indemnified the owner and every authorised agent of the owner by a contract of insurance with the State Government Insurance Office (Queensland) or with some licensed insurer against all sums for which the owner or his estate or any such authorised agent or his estate shall become legally liable by way of damages in respect of such motor vehicle for accidental bodily injury (fatal or non-fatal) to any person (including, in respect of such injury caused by any such other person, the owner himself) in any State or Territory of the Commonwealth of Australia where such injury is caused by, through, or in connection with such motor vehicle. Liability by way of damages referred to in the first paragraph of this subsection includes the liability (either joint or several) of an insured person –
(a) to pay or to contribute to the payment of such damages;
(b)to make contribution to any other tortfeasor under the provisions of The Law Reform (Tortfeasors Contribution, Contributory Negligence, and Division of Chattels) Act of 1952;
(c)to pay damages for breach of his contract of employment evidenced by his causing such injury.”
Liability by way of damages referred to in the first paragraph of this subsection does not include the liability of an employer incurred on or after 22 September 1988 to pay damages on account of accidental bodily injury (fatal or non-fatal) caused by, through or in connection with a motor vehicle to his employee (being a worker within the meaning of the Workers Compensation Act 1990) in circumstances such as would give rise to an entitlement to the payment of compensation under that Act.”
Section 44(2) of the 1990 Act, together with the definition of “accident insurance” is the most relevant provision of that Act for present purposes. Relevantly it provides:
“… every employer is to insure and remain insured with the board under a policy in respect of –
…(b)the employer’s legal liability existing independently of this Act to pay damages in respect of injury to a worker employed by the employer, being a liability within the cover of accident insurance as defined in section 5.”
“Accident insurance” is defined to mean “insurance by which an employer is indemnified against all sums for which the employer may become legally liable, in respect of injury to a worker employed by the employer, in respect of … damages arising under circumstances creating also, independently of this Act, a legal liability in the employer to pay such damages, other than a liability against which the employer is required to provide under some other Act of Queensland …”.
The respondent accepted that Carter’s claim was within the indemnity provided by the accident insurance policy it issued to the partnership of the Whites as employers. The matter did not come within the exception based on the definition of “accident insurance” because the employer, the partnership of the Whites, was not obliged to insure against liability associated with the use of the prime mover and trailer pursuant to the 1936 Act as only Keith White was the registered owner thereof. That would follow from the reasoning in Glover v Politanski (1990) 2 Qd R 41.
The principal submission of counsel for the applicant was that the claim was to be resolved in its favour by operation of the last paragraph of s 3(1) of the 1936 Act. That submission was disputed. Essentially the present issue is to be resolved by determining the proper construction of that paragraph.
The Court of Appeal in Lorimer v Thatcher (1993) 2 Qd R 25 held that the paragraph in question excluded from the liability to pay damages indemnified by insurance pursuant to the 1936 Act liability to pay damages to an employee only where the registered owner was liable as employer to pay such damages; in other words the registered owner of the vehicle must also be the employer. If that identity did not exist then the exception would not apply and the insurance pursuant to the 1936 Act would extend to the “liability by way of damages” to the injured person notwithstanding that such person also had a right to damages payable out of accident insurance pursuant to the 1990 Act.
The last paragraph of s 3(1) essentially defines “his employee” as a “worker” for purposes of the 1990 Act. That, in my view, takes one to the 1990 Act in order to ascertain who is a “worker”, and that necessarily means who is an “employer”, for purposes of that paragraph.
The term “employer” is defined in the 1990 Act as “an entity that employs a worker”; then one finds the term “entity” defined in the Acts Interpretation Act 1954 (s 36) as including an unincorporated body. It follows from that, in my view, that a partnership, though generally regarded as having no separate existence in law, may be an employer and thus an insured for purposes of accident insurance under that Act. Thus the relevant position is no different from that considered in Glover v Politanski; the earlier legislation applicable in that case contained an expanded definition of “employer” which, inter alia, included firms and associations.
On that approach the term “employer” in the last paragraph of s 3(1) of the 1936 Act carries the same meaning as that term does in the 1990 Act. In other words one must read for the term “employer” the “partnership of the Whites”. It follows from that that there would be no identity of employer and registered owner as required by the reasoning in Lorimer v Thatcher.
Counsel for the applicant sought to overcome that conclusion by submitting that the partnership of the Whites was not a recognised legal entity, and that the law only recognised the individuals comprising the partnership, namely Keith and Rosemary White. I reject that approach. As already stated, the paragraph, impliedly if not expressly, takes one back to the definition of “employer” in the 1990 Act, and that means that for purposes of this legislation a partnership is recognised as an entity capable of being an employer, and capable of being the insured for purposes of the 1990 Act. Once that is recognised the submission by counsel for the applicant is deprived of substance.
Given the reasoning in Glover v Politanski and Lorimer and Thatcher, and the analysis outlined above, the last paragraph of s 3(1) of the 1936 Act does not afford the applicant a ground for saying that the plaintiff’s statement of claim discloses no reasonable cause of action and/or the defendant has a defence to the proceeding.
In those circumstances counsel for the applicant advanced another argument in support of the application. He submitted that the respondent’s claim for double insurance must fail because an essential requirement of double insurance cannot be met, namely the requirement that each policy must cover the same insured and for the same interest. In that regard he referred to the reasoning in Albion Insurance Company Limited v Government Insurance Office of New South Wales (1969) 121 CLR 342, especially a passage in the judgment of Kitto J at 352. The majority (Barwick CJ, McTiernan and Menzies JJ) said at 345 that there is: “double insurance when an assured is insured against the same risk with two independent insurers”. The observation of Kitto J relied on by counsel for the applicant was to this effect: “What attracts the right of contribution between insurers, then, is not any similarity between the relevant insurance contracts as regards their general nature or purpose for the extent of the rights and obligations they create, but is simply the fact that each contract is a contract of indemnity and covers the identical loss that the identical insured has sustained.”
However, it is clear from the reasoning of the majority that it is “not necessary that the insurances should be identical.” The majority explained that by saying at 345-6:
“Thus one insurer may insure properties A and B against fire and the other insurer may only insure property A against fire. Again, one policy may be for a limited amount and the other may be for an unlimited amount. One policy may cover the risk of a whole voyage and the other may cover only part of the voyage. Differences of this sort may affect the amount of contribution recoverable but they do not bear upon the question whether or not each insurer has insured against the same risk so as to give rise to some contribution. The element essential for contribution is that, whatever else may be covered by either of the policies, each must cover the risk which has given rise to the claim. There is no double insurance unless each insurer is liable under his policy to indemnify the insured in whole or in part against the happening which has given rise to the insured’s loss or liability.”
Here the risk insured against was the same, namely liability for damages suffered by Carter driving the prime mover and trailer in the course of his employment. The damage in each case would be the same; to that extent this case is not distinguishable from Albion Insurance.
The remaining question is whether or not there was a sufficient identity of the insured to give rise to a situation of double insurance. Counsel for the applicant says that the insured pursuant to the policy issued under the 1936 Act was Keith White, and the insured pursuant to the policy of accident insurance issued in accordance with the 1990 Act was the partnership, therefore there was no identity of insured.
At this stage of the reasoning it is necessary, in my view, to remember that for purposes of the law (unless there is a statutory provision to the contrary) a partnership has no recognised identity apart from the individuals who are its members. If the partnership was sued then the individual members thereof would have to be named as defendants. That is what happened in the instant case brought by Carter; the defendants in action 6492 of 1996 were named as Keith White and Rosemary Beryle White. Sections 13 and 15 of the Partnership Act 1891 have the effect of making every partner jointly and severally liable for wrongful acts or omissions of any partner acting in the ordinary course of business of the firm. By providing that the partnership may be described as the employer and insured for purposes of the 1990 Act, the statute does no more than that. So far as liability is concerned one has to go back to the provisions of the Partnership Act and the common law. In other words though the partnership of the Whites was the employer, and named as the insured, when it came to liability the members of the partnership had to be sued individually and were liable jointly and severally. That had the consequence that the policy of insurance issued to the partnership indemnified the members thereof jointly and severally. That meant that at all material times Keith White was insured pursuant to the policy of accident insurance issued pursuant to the 1990 Act.
Keith White was also the insured person as registered proprietor of the prime mover and semi trailer under the policy of insurance issued pursuant to the 1936 Act.
In my view it does not matter that under the policy issued pursuant to the 1990 Act Keith White was an insured jointly and severally with the other member or members of the partnership. Importantly he was insured in his own right.
It follows from that, in my view, that there is an identity of insured as between the two policies in question. Keith White was insured pursuant to each policy and each policy indemnifies him with respect to liability for judgment for damages of the type sustained by Carter. It follows from that there is a double insurance situation here.
The statement of claim asserts in paragraph 9.6 that Rosemary White “as the person engaged in partnership with Keith White, and as such using the prime mover and trailer respectively in the course of the White’s business, was the authorised agent of Mr White in respect of such use” of the prime mover and semi trailer. That allegation is denied by the applicant and it was submitted on its behalf that as a matter of law Rosemary White could not be the “authorised agent” of Keith White for purposes of the first paragraph of s 3(1) of the 1936 Act. I am not convinced that as a matter of law that proposition is correct. It may well be that evidence would enable a finding to be made that she was an “authorised agent”, but it is not necessary to finally resolve such issues in order to dispose of this application.
For all the above reasons the applicant has not demonstrated that the statement of claim discloses no reasonable cause of action nor has it demonstrated that it has such a defence to the proceedings as to justify granting summary judgment.
It follows that the application should be dismissed with costs.
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