Ferguson v PJ and GR Kropp P/L & Anor [2001] QDC 291

DISTRICT COURT OF QUEENSLAND CITATION: Ferguson v. PJ and GR Kropp Pty Ltd & Anor [2001] QDC 291 PARTIES: ARTHUR GEORGE FERGUSON (Plaintiff) v. PJ AND GR KROPP PTY LTD (Defendant) And SUNCORP GENERAL INSURANCE LIMITED (Third Party) FILE NO/S: Plaint 174 of 1998 DIVISION: PROCEEDING: Application ORIGINATING COURT: District Court Brisbane DELIVERED ON: 16 November 2001 DELIVERED AT: Brisbane HEARING DATE: 9 November 2001 JUDGE: McGill DCJ ORDER: Plaint struck out CATCHWORDS: Evans v. Transit Australia Pty Ltd & Anor [2000] QCA 512 - followed Young v. Keong [1999] 2 Qd.R. 235 - followed Dey v. Victorian Railway Commissioners (1949) 78 CLR 62 - cited General Steel Industries Inc v. Commissioner for Railways (NSW) (1964) 112 CLR 125 - cited A v. Ipec Australia Ltd [1973] VR 39 – cited COUNSEL: P.C.P. Munro for the plaintiff K.F. Holyoak for the defendant SOLICITORS: Kevin McSweeney & Co for the plaintiff O’Mara’s Lawyers for the defendant -- 1 of 6 -- 2 [1] By plaint filed on 16 January 1998, the plaintiff claimed from the defendant $250,000 damages for negligence, breach of statutory duty and breach of contract of employment. It was alleged that on or about 20 March 1995 the plaintiff, in the course of his employment with the defendant, while driving a semi-trailer suffered an exacerbation of a back condition and a further injury to his back, as a result of the breach of various obligations of the defendant as employer, and as a result of the breach of the defendant’s duty under the Workplace Health and Safety Act 1989. By a third party notice filed on 15 July 1998, the defendant sought from Suncorp General Insurance Limited an indemnity under a policy of insurance issued under and in accordance with the Motor Accident Insurance Act 1994 (“the MAI Act”) in respect of any liability to the plaintiff. On 19 January 2001 I ordered that the third party be granted leave to defend the plaintiff’s claim in the proceedings, and made various consequential orders in relation to the trial together of the plaintiff’s claim and the defendant’s claim against the third party. [2] The plaintiff provided further and better particulars of its claim on 23 March 1998, and further particulars on 25 August 19981. On those particulars it is apparent that the plaintiff’s case is that he was employed by the defendant from about Christmas Day 1994 to 20 March 1995 to drive a milk truck which was required, in the course of its ordinary use, to travel over internal farm roads which were frequently rough. The truck was fitted with a defective seat, which did not have the usual capacity for adjustment and was not properly sprung, so that when the truck was driven over rough roads the plaintiff received a rougher ride than he ought to have received, and this exacerbated the condition of his back which amounted to an injury. The relevant injury therefore was not something which occurred on any particular occasion as a result of some specific incident on that occasion, but was the result of the cumulative effect of undue rough treatment which the plaintiff’s back endured as a result of the conditions under which he was working. [3] On 29 October 2001 the defendant filed an amended defence in which it was alleged inter alia that, if the plaintiff had suffered injury as alleged, the injury occurred in circumstances falling within s.5 of the MAI Act2 and that the plaintiff had failed to give notice as required by s.37 of the MAI Act, and had commenced the proceedings in contravention of s.39 and s.52 of the MAI Act3. The defendant has now applied to have the action struck out, or in the alternative, for there to be summary judgment for the defendant under r.293, or in the further alternative for the question of whether the matters to which I have just referred provide a good defence to the defendant to be decided separately in advance of the trial, and that there be consequential judgment for the defendant in the action. 1 Affidavit of Nicole Marie Lythall filed 29 October 2001, Exhibits NML2 and NML3. 2 The injury occurred after the MAI Act commenced on 1 September 1994; I have referred to Reprint 1B, as at 20 February 1997. The amendments made by Act 17 of 2000 clearly do not apply. 3 Section 39(5) was breached because proceedings were commenced without any of the requirements in para. (a), (b) or (c) being satisfied. Section 52 was breached because the insurer was not joined as a defendant. The effect of my order on 19 January 2001 was not to join the insurer as a second defendant. -- 2 of 6 -- 3 The plaintiff’s submissions [4] The plaintiff does not dispute that his claim is in respect of a personal injury caused by, through or in connection with a motor vehicle, and as a result of the driving of the motor vehicle, and was caused wholly or partly by a wrongful act or omission in respect of the motor vehicle by a person other than himself, so that the requirements of s.5(1) of the MAI Act were satisfied. The motor vehicle was at all material times insured, so that the operation of the MAI Act is not excluded by s.5(2), and it was not suggested that any of the exclusions in s.5(3) applied. It was also accepted that the plaintiff had not complied with any of the requirements of s.37, s.39 or s.52. It was however submitted that the plaintiff was suing the defendant as the plaintiff’s employer, in respect of the defendant’s breach of obligations arising out of the employer/employee relationship, and that that claim was completely constituted and complied with any applicable requirement of the relevant legislation, the Workers' Compensation Act 1990. It was submitted that, even if a cause of action arose which was within the scope of the MAI Act, there was a separate and coexistent cause of action which lay outside the MAI Act and to which the MAI Act did not apply, so that the failure to comply with the restrictions imposed by the Act was irrelevant. [5] It was submitted that each of the MAI Act and the Workers' Compensation Act created a statutory framework for compulsory insurance, and that as long as the plaintiff’s action was properly constituted for the purposes of the Workers' Compensation Act it did not matter if the provisions of the MAI Act had not also been complied with. The plaintiff’s argument essentially is that, because he was not seeking to have recourse to the scheme of compulsory insurance provided under the MAI Act, but rather was suing the defendant in the defendant’s capacity as the plaintiff’s employer, the plaintiff was not bound to comply with the requirements of the MAI Act. In effect, the plaintiff had the choice, to sue the defendant in accordance with the requirements of the MAI Act, or to sue the defendant in a way which would be consistent with the Workers' Compensation Act 1990, and the plaintiff had chosen the latter. Analysis [6] Although s.37(1) of the Act refers to an action for damages for personal injury arising out of a motor vehicle accident, and the term “motor vehicle accident” is defined as “an incident in which personal injury is caused by, through or in connection with a motor vehicle”, there is authority binding on me that an injury which arises progressively over a period of time as a result of the continuous operation during that period of a defective condition of a vehicle in circumstances which fall within s.5 of the Act, is subject to the requirement in s.37 even if there is no particular “incident” which can be identified as a motor vehicle accident: Evans v. Transit Australia Pty Ltd & Anor [2000] QCA 512. It was accepted on behalf of the plaintiff that the facts are not materially distinguishable from the facts in Evans. -- 3 of 6 -- 4 [7] In Evans there was no issue as to whether the plaintiff was entitled to recover, but I was told that was because the plaintiff in Evans had complied with the requirements of the MAI Act (as well as any applicable requirements of the workers' compensation legislation) so that that could not be an issue. The situation was different here. There was never any attempt to comply with the MAI Act, because as far as the plaintiff was concerned this was an industrial injury and the defendant was being sued as an employer, not as the owner of a registered and insured motor vehicle. [8] There is nothing in the Act which confines its operation to those situations where the defendant is sued specifically in its capacity as owner (or for that matter the driver) of a registered and insured motor vehicle. The scope of operation of the Act, as defined in s.5, is much wider than that. Section 5(1)(a) defines the scope of the application of the Act not by reference to the basis of the duty, a breach of which gives rise to liability, but by reference to the cause of the personal injury. If, for example, an employee is injured at the workplace as a result of a collision with a motor vehicle driven by another employee, it would not matter whether the basis of the liability of the employer was vicarious liability for the negligence of the other employee, breach of the employer’s duty to provide high visibility clothing to employees who were required to be in the vicinity of moving vehicles by the exigencies of their work, or breach of the employer’s obligation in relation to the overall organisation of the work. [9] There is no separate cause of action depending on whether the defendant is sued in the capacity of employer or the capacity of owner of a registered and insured vehicle. In circumstances such as the present the operative relationship giving rise to the particular duty of care, breach of which gives rise to liability in tort, is the relationship of employer and employee, and that is also the source of the duty in contract and pursuant to the statute. There is no separate duty giving an independent cause of action arising out of the ownership of the vehicle. The relevant duty, in respect of which the plaintiff was suing, arose out of the employer and employee relationship, although it was relevant to the content of that duty that during the course of that employment the plaintiff was required to drive the defendant’s vehicle. This is not a case where there were concurrent causes of action, one of which fell within the scope of the MAI Act and one of which did not. There were actually three concurrent causes of action, but they were all based on the employer/employee relationship. [10] Nevertheless, it has long been recognised that liability for breach of duty arising out of an employer/employee relationship can fall within the scope of compulsory third party insurance of motor vehicles4. That this is the case under the MAI Act is shown by the decision in Evans (supra). The fact that liability could arise in circumstances where the relationship between the plaintiff and defendant was one of employee and employer is also shown by the fact that the policy of insurance which is scheduled to the statute provides an exclusion in clause 3(1) for the employer’s liability to pay workers' compensation. 4 See for example McEwan v. Gold Coast City Council [1987] 1 Qd.R. 340. -- 4 of 6 -- 5 [11] An employer having a registered and insured motor vehicle used in the course of the employment would be expected therefore to have insurance required by the Workers' Compensation Act, and also insurance required by the MAI Act. There is nothing in the MAI Act which deals with the question of how any potential overlap is to be resolved; that is dealt with in the Workers' Compensation Act 19905. The obligation to insure imposed by that Act on the employer is in respect of the employer’s legal liability to pay damages in respect of injury to a worker within the scope of “accident insurance” defined in s.5, which excludes from the indemnity provided indemnity in respect of a liability “against which the employer is required to provide under some other Act of Queensland … ”. Hence if an employer is also required by (relevantly) the MAI Act to insure against a liability within the scope of the MAI Act as defined in s.5, such liability would not be within the cover provided by the policy under the Workers' Compensation Act . In this way the statutes guard against double insurance, but they do so on the basis that the MAI Act operates according to its terms, and the scope of the liability covered by policies issued under it is not confined by the possible existence of some cover governed by some other Act. Then the scope of the indemnity provided under the Workers' Compensation Act is limited by the exclusion of cases where otherwise there would be an overlap. [12] In my opinion, it would be inconsistent with that legislative scheme for the plaintiff, in circumstances such as the present, to be able to pursue some form of concurrent cause of action against an employer independently of the provisions of the MAI Act. If such a thing were possible, the employer might be left without a right of indemnity against either insurer in respect of such liability. In my opinion, the true position is that the MAI Act applies to any liability which falls within its terms, and an employee who seeks to sue an employer in a way which is not subject to the requirements of the Act needs to show that liability does not fall within the scope of the Act as defined in s.5. The particular circumstances fall within s.5, the Act applies and the employee must pursue any claim in accordance with the procedures laid down in the Act. If the circumstances do not fall within s.5, an employer can and should ignore the Act. [13] In the present case however, there is no dispute that the circumstances do fall within the terms of s.5. The MAI Act therefore applied, and the restrictions on suit provided for in ss. 37, 39 and 52 applied to the present action. Those provisions in effect prohibit action being brought unless certain requirements are satisfied. I am really being asked to imply into that prohibition an exclusion or limitation for causes of action by an employee against an employer. In my opinion, there is no basis upon which I would be justified in making that implication. The prohibition contained in the Act applies to any case to which the Act applies. It therefore applies to the present action, so that the plaintiff was required to comply with ss. 37, 39 and 52, but he failed to do so. That failure cannot now be cured: Horinack v. Suncorp Metway Insurance Ltd [2001] 2 Qd.R. 266. 5 I have referred to Reprint No 3 as in force on 28 April 1995. -- 5 of 6 -- 6 Conclusion [14] On the authority of Young v. Keong [1999]) 2 Qd.R. 235, the appropriate course in such circumstances is to strike the action out. It was submitted on behalf of the plaintiff that an action should be struck out only in a very limited category of circumstances, and reference was made to the leading authorities of Dey v. Victorian Railway Commissioners (1949) 78 CLR 62 and General Steel Industries Inc v. Commissioner for Railways (NSW) (1964) 112 CLR 125. It was submitted that the case should not be struck out where the claim raised an arguable point of law: A. v. Ipec Australia Ltd [1973] VR 39 at 53. Nevertheless, Young v. Keong (supra) stands as authority that in circumstances which are not materially distinguishable from those in this case the appropriate course is to strike the action out. The effect of that decision is that in those circumstances the position is sufficiently clear to satisfy that test. [15] It is therefore unnecessary to consider the alternative bases, but if I were concerned about the question of whether, under an application pursuant to r.171 or r.293, it was appropriate for me to decide the matter, I would have ordered that the question be decided separately in advance of the trial and instanter. This is not a case where there is any relevant factual issue the determination of which will effect the outcome; either the plaintiff has the cause of action pleaded, in which case there has been a failure to comply with the obligations imposed by the MAI Act, or the plaintiff does not, in which case the action should be struck out anyway. It was not suggested that the plaintiff can amend to allege any cause of action which would not fall within the MAI Act, and leave to replead was not sought. [16] I therefore order that the plaint be struck out. I will hear submissions as to costs, bearing in mind that this is a point which could have been taken promptly as soon as the plaint was served, but was not taken in the Entry of Appearance and Defence filed on behalf of the defendant on 11 August 1998, and indeed was not taken until filing of the amended defence on 9 October 2001. -- 6 of 6 --