Workers Compensation Board of Queensland v Technical Products Pty Ltd

[1988] HCATrans 60

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Brisbane No B70 of 1987

B e t w e e n -

THE WORKERS	COMPENSATION BOARD
OF QUEENSLAND

Applicant

and

TECHNICAL PRODUCTS PTY LTD

Respondent

Application for special leave

to appeal

BRENNAN J
DEANE J

GAUDRON J

Workers

TRANSCRIPT OF PROCEEDINGS

FROM BRISBAMF BY VIDEO LINK TO -CANBERRA

ON FRIDAY, 25 MARCH 1988, AT 2.01 PM

Copyright in the High Court of Australia

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MR J.A. GRIFFIN,~C:  May it please the court, I appear with my

learne friend, MR P.C.P. MUNRO, for the applicant.

(instructed by Bradley & Co)

MR D.P. DRUMMOND, QC:  I appear with my learned friend,

MR P. AMBROSE, for the respondent. (instructed by

B.J. McLaughlin, Ivey & Co)

BRENNAN J:  Thank you. Mr Griffin?

MR GRIFFIN:  I understand that Your Honours have been supplied

with copies of the WORKERS	COMPENSATION ACT of
Queensland.

BRENNAN J:	We have.
MR GRIFFIN:	It is my intention to take Your Honours to some

of the provisions of that Act. I undertake to be

as brief as I can. In this case the Full Court of

the Supreme Court of Queensland overruled the

applicant's demurrer to a third party statement of

claim in which the respondent employer sought an

indenmity against any liability to the plaintiff.

It sought that indemnity under the statutory policy

of insurance provided for in the WORKERS	COMPENSATION
ACT.

The facts are these: the plaintiff's husband,

Ian Stuart Hart, was employed by the respondent,

Technical Products Pty Ltd. On 13 August 1981 Hart

sustained an injury when he suffered a fall in the
course of that employment. In the present action
the plaintiff's wife, Patricia Hart, who is not

herself a worker as defined by the Act, alleged in

paragraph 8 of her statement of claim that she

attended on her husband in hospital after he had

had surgery for his injuries. Thereafter she continued

to attend hospital on a daily basis. When he was

finally discharged from hospital, Hart is alleged to

have been heavily reliant and dependent upon the

plaintiff. And as a result of all these matters it was pleaded in the plaintiff's statement of claim	that Mrs Hart suffered nervous shock and psychiatric
illness, in consequence of which she required
psychiatric and hospital treatment.

The employer sought indenmity from the Worker

Compensation Board of Queensland in respect of

Mrs Hart's claim and succeeded in the Full Court.

The decision of the Full Court is the first in this

State to hold that a claim by a person who is not

a worker as defined by the Act can arouse the connnon

law indenmity provisions in the legislation.

Workers compensation legislation in force in

Queensland in the early part of this century provided

for standard workers compensation benefits and
in addition required employers to take out insurance

providing them with connnon law indennity. At that

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stage the insurance in respect of common law liability

was with private insurance companies. However, in

1962 the system was changed. Private insurance was

abandoned and employers were required to

obtain common law indemnity by takin~ out a statutory

policy in accordance with the WORKERg COMPENSATION ACT.

(Continued on page 4)

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MR GRIFFIN (continuing):  The Act provided that the insurer

in all cases would be a State instrumentality

which is now called the Workers Compensation Board.

It further provided that all common law awards

would be met out of the same fund as standard
workers compensation benefits - that is the

workers compensation fund. This change was effected

by changes to section 8(1) of the Act which

was amended to read as follows:

Every employer shall be legally

liable to pay the compensation which

this Act prescribes a worker employed
by him shall receive out of the

Workers' Compensation Fund in accordance

with this Act.

Every employer shall insure himself

and keep himself insured with the Board

against all sums for which, in respect

of injury to any worker employed by
him, he may become legally liable by

way of -

(a) compensation under this Act; and

(b) in the case of injury as aforesaid

suffered on or after the first day of

July, one thousand nine hundred and

sixty-three -

and then there is an exception which is not

relevant -

damages arising under circumstances

creating also, independently of this

Act, a legal liability in the employer

to pay damages in respect of that injury.

At the same time, Your Honours, a new section,

section 9A,was introduced.

BRENNAN J: Just before you go on, Mr Griffin, in respect

section_ 8(1},~_b), what is the injur¥,._._	of that injury, those closing words in
in this case in your submission?

MR GRIFFITH:  The relevant injury in this case so far as

the plaintiff's claim is concerned is the injury
to her, that is,the injury that she sustained

of nervous shock and it is for that reason,

fundamentally, that we submit, that this claim is

not within the indemnity.

BRENNAN J:	Yes.
MR GRIFFIN:	Of course, the worker himself, Mr Hart, sustained

an injury.	He sustained his injuries as a result of
the fall.	Your Honours, section 9A which was

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introduced at the same time, sets out procedural

provisions which were complementary to the

introduction of the compulsory indemnity provided

to employers in respect of common law actions.

And section 9A(S), which Your Honours will see

on page 30 provides:

(Continued on page 6)

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MR GRlFFlN (continuing):

"The provisions, other than this section of

this Act relating to the recovery by a worker

from his employer of damages for which the
employer is, independently of this Act, legally

liable in respect of injury to such worker,

shall apply subject to this section."

Now that and the other provisions 0f section 9A make it quite evident, in our submission, that

the common law action is respect of which the employer

is supplied with an indemnity by the workers

compensation fund is a common law action

instituted by the worker himself o~ in the case of a deceased worker, his dependants. The case of a deceased worker needs to be specifically

mentioned and I refer Your Honours to section 3(4)

which Your Honours will find on page 8. It reads:

Any reference to a worker who has been injured,
where the worker is dead, includes a reference

to his legal personal representative or to

his dependants or other person to whom or

for whose benefit compensation is payable.

BRENNAN J: Mr Griffin, I do not think we need to trouble

you any further at this stage of the proceedings.

We propose to call on Mr Drummond and if you have

anything to say in reply, you will have an opportunity

then.

MR GRIFFIN: If the Court pleases.

BRENNAN J:  Yes, Mr Drummond.

MR DRUMMOND: If the the Court pleases, in our submission,

the matter is governed by the proper construction

of the second paragraph of section 8(1) of the

Act. The applicant's case really depends on reading

that provision of the section 8(1) as requiring

the employers statutory contract of insurance

to be an insurance against the liability of the

employer to a particular or particular class of

persons; here liability to a worker employed by

him. But the section does not, in our submission,

have any such operation.

What the provision provides for is the employer

insuring himself against all sums for which he

may become legally liable and the only words of

limitation cutting down that primary obligation

are contained in two segments of the provision.

Firstly, there is a limitation in the form of the

words that qualify the sums for which the employer

must take out cover and those words are the words

following:

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all sums for which, in respect of injury to

any worker employed by him.

And the second limitation is to be found in the words that qualify the employer's liability for

those sums. The employer is required to take out

cover in respect of:

sums for which ..... he may become legally

liable by way of -

and then going to clause (b):

damages arising under circumstances creating

also, independently of this Act, a legal

liability in the employer to pay damages in

respect of that injury.

Those are the only two qualifications on the

obligation to take out cover in respect of sums

for which he may become legally liable. Neither

of them focus upon the liability being in respect

of particular persons or classes of persons. They

focus on the nature of the liability as opposed

to the person who may be able to make the employer

liable.

A matter very close to this has been discussed

by this Court in the case of McDOWELL V BAKER.

That was a decision which turned on section 9A

of the Act. A widow brought a LORD CAMPBELL' s ACT

action in circumstances in which her husband died

as a result of iniuries received in the course
of his employment-but had survived for a time and

had been paid out a lump sum in respect of his

compensation. The issue that arose for determination

was whether, in terms of section 9A(l)(a) there
was to be deducted from the widow's LORD CAMPBELL's ACT

award the amount of compensation paid to the husband

in his lifetime.

The Full Court affirmed the decision of the

trial judge that since the deceased worker, prior to his death, had been paid his full compensation

entitlement, the widow was not, within the meaning

of section 3(4), a worker in so far as she was

not a person entitled to receive compensation,

and held that, in consequence, no deduction was

to be made from her award.

(Continued on page 8)

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MR DRUMMOND (continuing): That was reversed in this Court

and the judgment of Mr Justice Aickin,with which
two other members of the Court agreed, deals with

an asnect of section 9A of the Act which is contained

in similar wording in section 8(1).. The passage I

would like to take the Court to appears in the report

of McDOWELL V BAKER, (1979) 144 CLR at page 427.

Mr Justice Aickin was dealing with that expression

in section 9A which defines the kind of liability

that is the subject of that provision. The

expression in section 9A th~t was there in issue	.
was this:	where an injury · m respect whereof a worker is

entitled to receive compensation was received

by the worker under the:

Circumstances "creating -

also -

independently of this Act, a legal liability

in the employer to pay damages in respect of

that injury - "

then certain consequences follow. That same phrase

appears in section 8(1) as the phrase qualifying the

legal liability of the employer and, at page 427 of

the Commonwealth Law Reports, at about point 7,

Mr Justice Aickin said this:

In my opinion the section -

9A( 1) -

is not directed to causes of action but to the

simpler conception of liability for a

compensable injury, that is to say, all

liabilities which may arise therefrom.

It uses general language when it speaks of

"the amount of such damages which the

employer is liable to pay", thus concentrating

on the liability of the employer to pay

otherwise than under the Act, and not upon
the recipient of the payment.

And then, His Honour continued, at the bottom of the

page:

The damages may be payable to the worker or to

his dependants, depending on the circumstances,

and I can see nothing in the language or the

apparent policy of the section to suggest that

it is confined to damages payable to the

worker. Both those damages and damages payable

to dependants under LORD CAMPBELL's Act are
properly described as "in respect of that

injury".

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And then, His Honour continued in the next

paragraph with the conclusion that:

That injury was of the kind described in s. 8(1) and was the foundation of both

his claims and his dependant's claims,

whether for compensation or for damages.

and he -

BRENNAN J:Is that not the point here,whether one can say of

a claim of the kind that the plaintiff is bringing

here, that it is an injury of that sort?

MR DRUMMOND:  The claim that the plaintiff is bringing is a

claim in respect of an injury to a worker.	The
relevant injury, we submit, is the injury to
Mr Hart.

BRENNAN J: How can that be? Is there any liability to her

in respect of his injury?

MR DRUMMOND:	Yes, Your Honour.
BRENNAN J:	How does that arrive?
MR DRUMMOND:	The employer owes a liability to her in respect of

the nervous shock that she claims she suffered in

consequence of the injury to her husband.

BRENNAN J: That is her injury, is it not?

MR DRUMMOND:  That is her injury, yes, Your Honour.

BRENNAN J: And is it not in respect of that injury that the

action is brought?

MR DRUMMOND:  That is so, Your Honour. The action is brought

for damages for that injury but the question remains, in determining the Board's liability to indemnify the

employer, whether, in terms of section 8(1), the

employer's exposure to Mrs Hart is in respect of -

it is for a sum for which- in respect of an injury

to a worker employed by him, he has become ill,

become legally liable. So that -

BRENNAN J: Let us assume that the employer had discharged his

liability to the employee, that is, to Mr Hart.

MR DRUMMOND:  Yes, Your Honour.

BRENNAN J:  So that one might say that there is no question of

a liability any longer owing	by the employer in
respect of Mr Hart's injury.	Would Mrs Hart still
not have a cause of action?

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MR DRUMMOND:	She would still have a cause of action.
BRENNAN J:	And would that cause of action fall within

8(l)(a), in your submission?

(Continued on pagell)

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MR DRUMMOND:  In our submission it would, Your Honour.

The Board would be liable liable to indemnify the

employer in respect of her action, notwithstanding

that it may have already indemnified the employer

in respect of the husband's own separate action.

BRENNAN J: It seems a rather important question, though, does

it not, Mr Drummond?

MR DRUMMOND:  Our learned friend has said rightly that it

has not been decided previously, although the force
of his argument does depend on the term "worker",
really, bearing the meaning defined in section 3(4)

of the Act.

BRENNAN J: Or does it depend upon the construction of the

words "in respect of that injury"?

MR DRUMMOND:  That too, it depends upon both, Your Honour.

We have made our submissions, I think, as to why

Mrs Hart's own claim is one in respect of an injury

to a worker within the section. So far as our

learned friend must depend on section 3(4), the

definition of "worker" is concerned, he is faced

again with a difficulty raised by McDOWELL V BAKER.

If I could take the Court to a passage in

Mr Justice Aickin's judgment, at the middle of

page 428, His Honour says:

I have not so far dealt with the operation

of the extended meaning given to the term

"worker" bys 3(4) -

and he says that it must only be applicable and

if the:  .

context otherwise indicates -

and it goes on to say -

within a single section a substitution -

of the extended meaning -

may be made in one place, though not 1n

another.

And then he turns to section 9A and I would ask

the Court to go to that provision and read it with

what His Honour says:

Thus ins 9A it would seem that the

substitution could be made where the word

"worker" first appears because dependants

may be entitled to receive compensation -

"worker" first appears on the first line -

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but that no such substitution can be

made where the word "worker" second appears,

for it is only the worker himself who can

"receive an injury".

Those words are directly applicable to section 8(1).

The word "worker" where it first appears in the

subsection in the third line of the first

paragraph can be given the extended meaning but

when one comes to the word "worker" where it

secondly appears in the provision we have been
concentrating on in the second paragraph, it cannot

be given the extended meaning because only the

worker employed can receive the injury.

(Continued on page 13)

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MR DRUMMOND (continuing):	For those reasons we therefore

submit that the Full Court, which adopted the approach
of looking at the meaning of section 8(1), having

regard to McDOWELL V BAKER and recognizing that

there may be gaps in the scheme provided by

section 9A consequential to section 8(1) nevertheless

concluded that the wording of section 8(1) was

so strong as to require a conclusion that the

wife's own nervous shock claim was a claim in

respect of injury to her husband and was within

the indemnity. If the Court pleases, those are

our submissions.

BRENNAN J:  We do not need to trouble you in reply, Mr Griffin.

This is a case in which the Court thinks it

appropriate to grant special leave to appeal.

Special leave is granted accordingly.

AT 2.21 PM THE MATTER WAS ADJOURNED SINE DIE

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