Brambles Ltd v Wail; Brambles Ltd v Andar Transport Pty Ltd [2002] VSCA 150

Practice and procedure - Judge's directions to jury - Whether miscarriage arising from failure to re-direct jury concerning future economic loss.

Negligence - Industrial accident - Plaintiff injured at work - Plaintiff sued head contractor and defendant claimed against plaintiff's employer as third party - Contribution and apportionment - Wrongs Act 1958 s.23B(1).

Contract - Indemnity - Contractor providing laundry service to private hospitals - Sub-contractor's director and principal employee injured at work and successfully sued head contractor - Whether sub-contract required sub-contractor to indemnify head contractor - Contract for term of three years only - Accident occurring outside three year period - Implied or tacit agreement to continue on same terms inferred from parties' continuing to deal - Interpretation of indemnity clause.

2. These appeals derive from a County Court action which took place before a judge and jury in March 2000 in which the respondent Wail ("Wail") sued the appellant Brambles Ltd. ("Brambles") for damages, alleging that Brambles' negligence was a cause of injury suffered by him as the result of an incident which occurred on 26 July 1993. At the time of the incident, Wail was employed by Andar Transport Pty. Ltd. (hereinafter called "Andar") which was a company incorporated in 1990 by Wail and one Andrew Parker, and of which Wail and Parker were directors and employees. Brambles joined Andar as a third party to the County Court proceedings and sought indemnity from Andar in respect of any damages which it, Brambles, might be ordered to pay to Wail or, alternatively, contribution on account of Andar's own negligence as the employer of Wail.

5. In the event, on 22 March 2000, the jury found that there was negligence on the part of Brambles which was a cause of Wail's injury and loss; it awarded $100,000 to Wail on account of general damages and $315,000 on account of pecuniary loss damages; and reduced those damages by 35% by reason of Wail's contributory negligence (there was no appeal by Wail against this finding). The proceedings were governed by s.135A of the Accident Compensation Act 1985 and, pursuant to that section, an amount of $104,411.60 fell to be subtracted from the jury's verdict for the repayment of compensation which had been paid to Wail. After subtraction of that amount and allowance for 35% on account of Wail's contributory negligence, the judge entered judgment for the plaintiff in the total sum of $201,822.46, together with damages by way of interest of $2,000; and ordered Brambles to pay Wail's costs of the action. His Honour certified that those costs ought to be paid on a "solicitor/client" basis, doing so after being referred to a notice of "offer of compromise" which had been served by Wail's solicitors upon Brambles' solicitors on 17 March 2000. The offer made on behalf of Wail was one in which he had agreed to accept a sum of $100,000 "plus retention of weekly payments to date in the sum of $104,411 plus costs". Over the objection of counsel for Brambles, his Honour ruled that this offer was a "valid offer" and, accordingly, made the order to which we have referred.

8. Following the conclusion of evidence at the trial the parties had agreed that the issues arising on the third party notice should not be left to the jury for its determination but should be determined by the judge subsequent to the jury's verdict. Indeed argument on the third party issues took place on the 22 June 2000, and his Honour did not deliver his reasons for dismissing the third party notice until June 2001. On the 6 June 2001 his Honour ordered that the third party claim of Brambles against Andar be dismissed and that Brambles pay Andar's costs to be taxed.

12. Wail, who was aged approximately 37 years at the date of trial, was a truck driver by occupation. In the early 1980's he had been employed as a truck driver by a furniture and piano removalist firm for which he worked until he transferred to Princes Linen Service in or about 1988. Princes operated a commercial laundry and cleaning service involving collections from, and deliveries to, a significant number of private hospitals and nursing homes in the suburbs to the east and south of Melbourne. Princes had a system for effecting those collections and deliveries using large trolleys apparently designed for the task. For the purpose of delivery, clean linen would be loaded into the trolleys by employees at the laundry premises in Box Hill and assigned to nominated nursing homes or hospitals. The drivers were themselves assigned to nominated "routes" and trucks were accordingly provided. The drivers, including Wail, were required to attend the laundry premises in the mornings for the purposes of loading into their trucks up to 22 trolleys which had been stacked with clean linen by the company's employees. The truck had, at its rear, a "hydraulic lifter" to enable the trolleys to be loaded into and taken from it. In this way it was the driver's responsibility to "stack" the trolleys into the truck "4 abreast", and to unload them in reverse order as deliveries were fulfilled along the pre-determined routes. The routes and times of delivery were determined by the laundry to meet the convenience of the various hospital customers.

15. At some stage in the late 1980's Brambles acquired the business of Princes Laundry and Wail became its employee. Brambles adopted the same methods of delivering and picking up laundry from its customers, and the use of the same trolleys for the purpose of doing so. The trolleys were large "industrial type trolleys" some three feet wide, six feet long and five feet high. They had been designed for their purpose by Princes Laundry many years before 1990. When full of linen, the evidence of Wail was that they weighed somewhere between 500 kg and 750 kg. The evidence given by Brambles' distribution manager, Mahoney, was that, on average, they would not weigh more than 250 kg. The trolleys were fitted with "swivel wheels" on each corner which Brambles maintained was for "greater manoeuvrability"; but which Wail said caused constant problems as a consequence of the trolleys "tracking erratically" and "sticking" when they turned across the direction of travel. The evidence was that the system of work designed by Brambles for its drivers - including Wail - involved the drivers loading the filled trolleys onto the trucks in the morning at the Box Hill Depot, lining them up, four abreast, across the tray of the truck (which amounted to a "fairly tight fit") and securing them with "ties" provided by Brambles.

18. In 1990 Brambles decided that it would change its delivery practices at the Princes Laundry, including its relationship with its drivers. It determined, no doubt for its own good reasons, that it would no longer employ its drivers to do the deliveries, but would use incorporated independent contractors to do them. It gave the opportunity to the existing drivers to tender for the routes available. Wail wished to take advantage of the opportunity provided by Brambles and was instrumental in forming the corporate entity Andar Transport Pty. Ltd. for the purposes of purchasing the truck of which he had been the driver and entering into an agreement with "Princes Fabricare Services" (a division of Brambles) for servicing the same routes and doing the same deliveries which Wail had formerly done as an employee. Accordingly, Andar, on 28 March 1990, entered into a written agreement with Brambles pursuant to which, for stipulated remuneration, it undertook to provide the delivery services for a term of three years commencing on 4 April 1990. The agreement was expressed to be "subject to renewal at the discretion of [Brambles]" but had not been expressly renewed by the time Wail suffered his injuries on 26 July 1993. The agreement contained a number of clauses, but those which became particularly relevant during the third party proceedings were clauses 4.3.8, 4.6, 8.1 and 8.2 pursuant to which Andar agreed to indemnify Brambles against claims, losses, damages, injuries, etc. in certain circumstances. All of these matters became relevant to the third party claim which his Honour dismissed on 6 June 2001.

21. It was pursuant to these arrangements that Wail attended at the laundry premises of Brambles at Box Hill in the early hours of the morning of 26 July 1993. He was then about 30 years of age. He there loaded his truck with trolleys of clean linen destined for various hospitals and nursing homes. About half to three-quarters of an hour into his journey, he arrived at the Cotham Private Hospital in Cotham Road, Kew, where he was required to unload a number of trolleys filled with clean linen. He reversed into a driveway adjacent to the hospital's "delivery bay". Parked in the position in which it was, the rear of the truck was higher than its front. Wail opened the rear of the truck, lowered the hydraulic tail-gate, and untied the trolleys which were due to be delivered. He placed his left hand on the roof of the truck and his right hand on the trolley which was at the right end of a line of trolleys. He then went to pull that trolley up the slight slope towards the hydraulic tail-gate. In exerting pressure in that way, he felt a searing pain across his lower back which caused him to sink to his knees. He was forced to sit down for some time whilst the pain subsided. After some 10 minutes, the pain eased sufficiently for him to continue the unloading process. Although he maintained that he was in "considerable pain" (he thought he had pulled a muscle) he was able to complete his delivery rounds. During the course of his evidence, he described the trolley as being "jammed against" the one to its left and as resisting movement. He said that he reported the incident to Brambles when he had completed his round.

24. There was little doubt that, as a result of this incident, the plaintiff had done damage to the lumbo-sacral disc in his lower back. His local practitioner, Dr. Loizou, said that Wail attended his practice on 9 August 1993 with a history of injuring his back "three weeks ago" when he had "pulled a trolley backwards to get it up a step and felt sudden pain ... radiating down both legs, thighs laterally". The evidence was that, on the same day, 9 August, Wail had received from the doctor a "certificate" saying that he was unfit for work. It would seem that the date of this certificate later became confused by others to be the date of the injury, as will hereafter appear. In any event, the treating practitioner referred Wail in September 1993 to an orthopaedic surgeon, Mr. Carey. The history given by Wail to Mr. Carey was that "in mid July" he received a "sudden pain in the back" when "pulling a trolley backwards to get it up an incline". At the time when he saw Carey, Wail was complaining of constant pain in the lower back. Carey was shown a CT scan which had been taken at the behest of the general practitioner in August 1993 and which did not disclose abnormality. Carey, after treating Wail conservatively for some months during which the pain was not resolved, referred him for an MRI scan which disclosed a "bulge" at the L5/S1 intervertebral disc joint. This, according to Carey, was consistent with the complaints of pain which Wail was making. Carey regarded him as not fit for work as a truck driver. He prescribed therapy, light gym work and gentle exercise. Wail's condition did not respond to the therapy prescribed and he was referred by his general practitioner to various other experts over the ensuing years. The same history was given to these experts - namely that the origin of the disorder was the incident described as "pulling the trolley in July 1993". There was little dispute among the witnesses called on behalf of Wail that his ongoing disability was due to the injury to the L5/S1 disc occasioned by the trauma generated by the incident of "pulling the trolley" in July 1993. There was much medical opinion that Wail's injury had destroyed his capacity to engage in his former work as a truck driver. The business of Andar ran down and Wail was virtually unemployed from 1993 to 1999 when he began to earn a modest income as a "computer animator".

27. Brambles and Andar were each represented by counsel at the trial. They made common cause against the interests of Wail. Each asserted at the outset that the claim was not legitimately brought because Wail did not have the requisite leave required by s.135A of the Accident Compensation Act 1985. Because Wail's injury was one suffered during the course of his employment, his claim was governed by the provisions of the Act; and his right to bring common law proceedings against Brambles was subject to the obtaining of the court's leave upon satisfaction that his injury was a "serious injury" within the meaning of s.135A (see s.135A(4) and (19)). In conformity with these provisions, Wail had sought leave to bring common law proceedings from a County Court judge in November 1997. The judge determined that his injury was a "serious" one and gave the leave contemplated by s.135A. The court's formal order was in the following terms:

"Judgment that Plaintiff has a serious injury and has leave to bring proceedings based upon a cause of action said to have arisen on 9 August 1993."

The proceedings which were filed in the County Court, pursuant to the leave given, asserted (in the statement of claim annexed to the writ) that the plaintiff had suffered his injury on 9 August 1993. At the outset of the trial counsel for Wail sought the trial judge's leave to amend the pleadings to allege that the injury occurred on 26 July 1993. This application was opposed by counsel for Brambles who asserted that, if the application to amend the pleading was granted, he would move for dismissal of the action on the ground that it was not the action for which leave had been given. As it happened, the judge did give leave to amend the statement of claim so that it would properly reflect the evidence to be given; and having done so counsel for Brambles - in accordance with his stated intention - moved to strike the amended claim out. In a considered ruling given on 10 March 2000, the trial judge refused counsel's application, concluding that - in the circumstances with which he was concerned - the date referred to in the order of the judge granting leave was not material. Because his Honour's ruling in this regard was contested by Brambles (although not seriously) on this appeal, it is a matter to which we will hereafter need to return.

32. There were other matters raised by counsel for Brambles during the course of the trial. One of those went to the issue whether, in the circumstances disclosed by the evidence, Brambles owed a duty of care to Wail. On 17 March 2000, after counsel for Wail had closed his case, counsel for Brambles submitted to the judge that the evidence did not disclose that any duty of care was owed by the defendant to the plaintiff, the contention being that at all relevant times the relationship existing between Wail, as an employee of Andar, and Brambles was not one in which the law would recognize any relevant duty of care existing between Brambles and Wail. Counsel did not submit that, in the event that such a duty existed, there was no evidence upon which the jury could find a breach of such duty. On 20 March 2000 - again in a considered ruling - his Honour concluded that, in the circumstances disclosed by the evidence before him, a relevant duty was owed by Brambles to Wail. Following his Honour's ruling, counsel for Brambles called evidence from the distribution manager for Brambles and an orthopaedic surgeon, Mr. Cullen. Counsel for the third party, Andar, called the orthopaedic surgeon Mr. Grant.

35. In common law proceedings governed by the provisions of s.135A of the Accident Compensation Act - as these proceedings were - a plaintiff is limited (by s.135A(7)) to recovery of "pecuniary loss damages" up to a specified limit and "pain and suffering damages" up to a specified limit. During the course of the judge's charge to the jury, counsel for Brambles and Andar took exception to his Honour's directions relating to the manner in which the jury should approach the evidence in respect of pecuniary loss. Specifically it was asserted that his Honour was in error in telling the jury that there did not seem to be "any significant challenge or dispute to the fact of what [Wail's] earnings were in 1992 and 1993, and you might think ... that the basis upon which the argument of the Plaintiff being put as to the average being around, perhaps, a little under $25,000 per year is reasonable". The figures referred to by his Honour were based on Wail's income tax returns for the years ending 1992 and 1993 which showed gross income earned in the former year as $33,000 and for the latter year at $39,000. Based on these figures counsel for Wail had put it to the jury that, for the purposes of assessing pecuniary loss, it could be assumed that the net income being earned at the time of the injury was "about $25,000" per annum or $500 net per week. Counsel for Brambles and Wail said that the "wage and salary book" produced by Andar (and marked Exhibit "D") reflected a weekly income from personal exertion at "about $400" per week. His Honour, according to the transcript, appeared to regard the exception taken to his directions as one without substance on the basis that the "wage and salary book" was vague and unreliable and the tax returns were a better record of what, in fact, were Wail's earnings for the respective years. However, the transcript records his Honour as saying:

"I will bring the jury back because I must direct them with respect to the question of the figure of past loss and direct them, generally, on the issue as to future loss and the basis of calculation that is being put to them ... . I will bring them back at 2.30."

39. There was further debate upon the topic after the luncheon adjournment during which counsel for Brambles and Andar continued to press the judge to give further directions as to the evidence of Wail's pre-accident earnings, but meeting an increasing reluctance by the judge to do so. The debate ended with the jury indicating that it wished to return to court, and the judge concluding the debate on the topic with the following words:

"We had better hear what the jury has to say at the moment. ... You are not suggesting, are you that I am required to read out the arguments of counsel to the jury? ... What I rather gather about all of this is that a whole lot of stuff was thrown up in the air without any suggestion of what conclusion ... could be drawn from it and I don't know that there is a great deal of merit in repeating such a vacuous argument, quite frankly."

43. There the matter was left. It would seem that the jury must have sounded their buzzer because the next record on the transcript is that the jury had returned and announced that they had reached a verdict. It is pertinent to note that the transcript does not record, before the jury was called into court, any request by counsel for Brambles or Andar to ascertain whether the jury had reached its verdict, or any objection on their behalf to the verdict being taken. Nevertheless, it is a matter to which we will have to return because Brambles has taken the point in this Court that his Honour's directions on damages were inadequate and that a miscarriage occurred because of his Honour's failure to re-direct as he said he would.

46. Following the return of the verdict his Honour was informed of the existence of the notice of offer of compromise to which we have previously referred. Because this offer on Wail's behalf was for a sum less than the amount for which judgment was entered, his Honour ordered costs on a solicitor/client basis. The judge rejected a claim by counsel for Brambles that the notice was invalid because it was one with which Brambles could not comply.

49. Having finalized the orders as between Wail and Brambles, his Honour, on 23 March 2000, turned his attention to the issues raised by the third party proceedings. On that day counsel for Brambles applied to his Honour for leave to amend the particulars of claim against Andar to allege, in addition to the claim already made in negligence, a claim that Andar was liable - pursuant to stipulated clauses of its agreement with Brambles - to indemnify Brambles against (inter alia) all actions, claims, demands, losses, damages etc. for which Brambles should become liable arising from injury, etc. caused or contributed to by the conduct of the delivery round by Andar. Such leave was granted by his Honour and, pursuant to the leave, Brambles filed and served an amended third party notice on 23 March 2000. Again pursuant to leave granted, Andar filed an amended defence to Brambles' claim which denied negligence, alleged contributory negligence, denied that it was liable to indemnify Brambles pursuant to the agreement, and alleged that, in any event, that agreement had expired on 3 April 1993. In reply Brambles asserted that the agreement continued after 3 April 1993 on the same terms and was extant on 16 July 1993 when Wail suffered his injury. His Honour adjourned the date for the hearing of the issues in the third party claim to a date to be fixed. In fact the hearing of argument took place on 22 June 2000. On 6 June 2001 his Honour, in accordance with reasons delivered, dismissed the third party claim and ordered Brambles to pay the costs of it. On the assumption that Wail was an employee of Andar, the judge appears to have rejected Brambles' claim for contribution pursuant to ss.23B(1) and 24(2) of the Wrongs Act because, in the circumstances of the case, it was not "just and equitable" (assuming liability on the part of Andar) to order contribution in favour of Brambles because Andar's liability could not be more than the 35% found by the jury to be the extent of Wail's responsibility for his own loss. Although his Honour found that the terms of the agreement between Brambles and Andar continued to bind the parties at the date of Wail's injury on 26 July 1993, he concluded that none of the indemnity clauses contained in the agreement obliged Andar to indemnify Brambles against the damages payable by it to Wail.

Appeal by Brambles against Verdict and Orders made on Third Party Claim

53. Although the grounds set out in the notice of appeal challenging the jury's verdict are repetitive, and in some instances obscure, counsel appearing for Brambles in this Court refined them in their outline of argument to the following:

(i) The plaintiff (Wail) had not complied with the provisions of s.135A(4) of the Accident Compensation Act 1985 (Vic.);

(ii) The defendant (Brambles) challenges the finding that it owed to Wail a duty of care;

(iii) The verdict of the jury, insofar as it found Brambles negligent, was against the evidence and the weight of the evidence.;

(iv) The jury verdict was "incorrect" as the judge failed to properly direct the jury on the calculation of pecuniary loss;

(v) The jury verdict was "incorrect" as the learned trial judge had indicated that he would recall the jury after it had retired to consider its verdict, to redirect them on the basis of calculation of economic loss; and allowed the jury to deliver its verdict without such redirection;

(vi) The judge erred in ruling that the offer of compromise served by the plaintiff (Wail) upon the defendant (Brambles) on 17 March 2000 was effective to found an award of costs to Wail on a solicitor/client basis.

Counsel directed no oral argument to the first ground, but said that they were content to rely upon their written outline; and the grounds which we have numbered (iv) and (v) were argued together. At the outset of the appeal, counsel indicated that the appellant was not pursuing the ground which we have identified as (ii); and during the course of argument counsel abandoned the last ground which we have numbered (vi).

59. In its appeal against the judge's orders made on the third party claim, there are 15 grounds outlined in the notice of appeal. It is sufficient for present purposes to say that the appellant complains that the judge was in error in using the jury's findings of contributory negligence and apportionment in determining the issue of contribution between the defendant and the third party, and in concluding that there was no evidence to support the defendant's claim for contribution beyond what the jury had found to be the plaintiff's responsibility for his own loss. Furthermore the defendant contends that the judge was in error in finding that there was no obligation in the third party to indemnify it in accordance with the agreement between the parties. In response to Brambles' notice of appeal, Andar filed a notice of contention by which it asserts that Andar was not liable for any injury suffered by Wail; that Wail was the director of Andar with sole responsibility for the acts and omissions claimed to constitute the breach of duty and, accordingly, Andar owed no duty to him and/or breached no duty owed to him; and that any fault on the part of Andar was co-extensive with Wail's fault - as a consequence of which there was no duty owed and/or no breach by Andar of any duty owed. Furthermore, it is contended by Andar that the agreement containing the indemnities was not operative at the time when Wail suffered his injuries and that the judge should have so found.

Appeal against Verdict : Ground (i) - non-compliance with s.135A(4) of Act

63. The appellant contends, under cover of this ground, that the judge was in error in failing to "strike out" or dismiss Wail's claim following the amendment made at the outset of the hearing to allege that the injury, for which Wail was seeking compensation, occurred on 16 July 1993 and not on 9 August 1993 which was the date specified by the judge who determined the application for leave pursuant to s.135A of the Accident Compensation Act. As we have previously noted, persons who claim damages in this State for injuries "arising out of, or in the course of or due to the nature of [their] employment" can only seek to pursue those claims in accordance with the provisions of s.135A. So far as relevant to this case, such claims can only be brought if their employment was a significant contributing factor to the suffering of the injury and the injury is a "serious injury" and it arose on or after 1 December 1992 (s.135A(2)). The significance of the date is that it was the date upon which the Accident Compensation (Workcover) Act 1992 came into operation. Relevantly, for the purposes of this claim "serious injury" is defined in sub-s.(19) as "serious long-term impairment or loss of a body function"[1]. Again relevantly for present purposes sub-s. (4)(b) prescribes that no such claim can be brought unless "a court, on the application of a worker ... gives leave to bring the proceedings". Such leave can only be given if "it is satisfied that the injury is a serious injury" (sub-s.(6)). These provisions are, thus, "gateway provisions" which must be satisfied before the claim for damages can be brought. The provisions have provided fertile fodder for the profession notwithstanding the lament of the courts that it has given rise to a "foolish, wasteful and inconvenient system" which duplicates the expense in establishing the nature and degree of the potential plaintiff's injury[2]. It can only be assumed, from the fact that the system remains, that it is still regarded, on balance, as a cost-saving system. By its very nature, a preliminary finding by a judge that the applicant for leave has sustained a "serious injury" arising out of his employment does not finally determine the rights of the parties. It is merely a preliminary step along the way to establishing those rights. It does not prevent the defendant, at the trial, from challenging the seriousness of the injury, or from seeking to show that it did not arise out of the plaintiff's employment, or that such employment did not significantly contribute to it. The focus of the leave application is whether, in the opinion of the judge asked to grant leave, the injury is a "serious" one within the meaning of s.135A(19).

66. Notwithstanding what we have said, the appellant here contends that because the order made by the judge, who heard the leave application, records that leave was given to Wail to bring proceedings for a serious injury "based on the cause of action said to have arisen on 9 August 1993", the judge at trial was bound to terminate those proceedings as soon as application was made, and leave was given, to amend the date of the occurrence of injury to 26 July 1993. It was further contended that the judge was not permitted to look at the transcript of proceedings of the "leave application" for the purposes of ruling upon the application.

69. In our view, there is no merit whatever in this ground of appeal. Indeed it was not surprising to hear senior counsel for the appellant inform the Court that it was not his "killer point". In the circumstances of this case, his Honour was correct to have regard to all the documents before him, including the transcript of the leave application, for the purposes of determining that the date, which was referred to in the order granting leave, was not material either to that judge's order, or to the application for leave to amend. What was before the judge demonstrated quite clearly that Wail had complained to his treating doctors that he had injured his back "pulling a trolley" on 26 July 1993 in the course of his employment. That was the injury which was the subject of the "leave application". It became reasonably apparent that the date recorded in the order of the judge who granted leave (namely 9 August 1993) was influenced by the fact that that was the date of the first certificate given by the treating doctor. In our view the judge was correct to regard it as immaterial to the order granting leave, and was also correct to allow the statement of claim to be amended to record a date which was consistent with the claim. Although it is not necessary for us to decide in this case, we can conceive of circumstances where a date will, or might, be material to proceedings brought pursuant to leave, or even to the judge's discretion in the leave application; for example if it demonstrated that the injury sued upon was suffered outside the date prescribed by the legislature for the purpose of identifying a compensable serious injury[3]. However, that is not the case here. We reject this ground of appeal.

Ground (iii) - Jury's verdict against the weight of the evidence

73. It is not suggested by the appellant that his Honour did not fairly and fully direct the jury as to the issues between the parties on the question of liability or the evidence relating to those issues. Nor is it in contest that the defendant made no application to "non-suit" the plaintiff or for leave to "move non obstante". On this aspect, however, counsel for Brambles has submitted that there was no evidence upon which the jury could properly return a verdict against it. In general terms, Wail's case was that the system of work which had been designed by Brambles for effecting deliveries of linen, and which it required the contracted drivers to employ, unreasonably exposed those drivers to risk of injury because of the weight of the fully laden trolleys combined with their lack of manoeuvrability and tendency to "stick" when jammed up against other trolleys in the row. The evidence given by and on behalf of the respondent, Wail, was that these trolleys, when fully laden, weighed between 500 and 700 kgs and that to move a trolley of that weight from a stationary position was calculated to impose an unreasonable strain upon the driver. Wail's evidence was that the trolley which he was "pulling" when his back "gave way" was fully laden and was "stuck" against the trolley to the left of it. He had difficulty in moving it. This case made on behalf of Wail was supported by an engineer, Lightfoot, who gave evidence that the design of the trolleys, with the four swivel wheels, was less than adequate for the use to which they were employed because, when moving them from a stationary position, greater force than was reasonable was or might well be imposed upon the handler due to the tendency of the wheels to swivel across the direction of intended travel. A better system, he opined, was to "fix" two of the wheels to lessen the tendency to "stick" when the trolleys were laden. He stated that, in the designed state of these trolleys, he would recommend that they should not weigh more than 250-300 kg when laden.

76. In response to this case, Brambles contended to the jury, largely through the evidence of its distribution manager, Mahoney, that the system, which Wail was required to employ on 26 July 1993, had been in existence for many years and had been found to be adequate. It was also a system with which Wail was well acquainted. He gave evidence, in cross-examination, that the weight of the trolleys was in the vicinity of 200-250 kgs when laden, well below the estimate given by Wail. He also said that it would be impossible for the trolleys to weigh as much as Wail had estimated because the "carrying capacity of the 10 tonne truck" would be exceeded. He said that no complaint had been received by him to suggest that the swivel wheels made the trolleys difficult to move from a standing position, and that it was necessary to have a "tight fit" of the trolleys within the truck to prevent movement. He said that Brambles had tried the system of two "fixed" and two "swivel" wheels but it was found to reduce the manoeuvrability of the trolleys.

79. The issue as to the weight of the fully laden trolleys was a significant one. In that respect the failure of Brambles to call the expert engineer whom it had retained shortly before the trial to inspect the trolleys and the system employed became an issue in itself. It had not been put to Wail in cross-examination that his estimate of weight was incorrect; nor had it been put to him or Lightfoot that, if the estimates were correct, the carrying capacity of the truck would be exceeded; and Mahoney had given no evidence as to the weight of laden trolleys in his evidence in chief. His evidence in chief was solely directed to the system employed by Brambles to maintain and repair trolleys about which complaints were made. Mahoney agreed, in cross-examination, that Brambles had retained its own expert engineer, Dohrmann, in "recent times" to inspect the trolleys to equip him to give evidence in these proceedings. He said that Dohrmann had weighed the trolleys and also weighed the "products" with which they were filled. Yet, although the evidence of weight estimates given by Wail and Mahoney was significantly different, Brambles did not call Dohrmann on this or any other issue. Not surprisingly, trial counsel for Wail made much of this failure in his address to the jury, and the judge gave to them, in unexceptional terms, a direction in accordance with Jones v. Dunkel[4].

82. This, then, was the state of the evidence on the question of negligence which was left to the jury to consider, and in respect of which the jury found that Brambles was negligent. Counsel for Brambles submitted that we should now conclude that their verdict in this respect was unreasonable and unsupported by the evidence. We do not agree. It is trite to say that appellate courts should be slow to disturb a jury's verdict arrived at after a consideration of evidence which is in dispute. The jury is the "constitutional tribunal" in respect of findings of fact[5]. Where a civil action is conducted before a jury, there is an important distinction between the functions of the judge and jury, which necessarily must be recognized by appellate courts[6]. In approaching a jury's decision on disputed questions of fact, an appellate court must assume that the jury has taken a view of the evidence most favourable to the plaintiff and has rejected the evidence and inferences favourable to the defendant[7]. Appellate courts are not authorized to disturb a jury's verdict simply because they do not agree with it or regard the evidence as preponderating against it. Absent misdirection or misreception of evidence, the appellate court must assume that the jury acted lawfully and properly in reaching their verdict. It is only if the verdict betokens "a conclusion which is against the evidence in the sense that the evidence in its totality preponderates so strongly against the conclusion favoured by the jury that it can be said that the verdict is such as reasonable jurors could not reach" that an appellate court can intervene[8]. Applying these principles to this case, we are quite unable to say that, in the light of the disputed evidence before them, this jury was acting unreasonably in concluding that Brambles was in breach of the duty which it now admittedly owed to Wail. In our view the jury was entitled to take the view that a system which required a driver to manipulate heavy trolleys in circumstances where a combination of their weight, design, and resistance to movement was calculated to put a more than significant strain upon their handlers was one which unreasonably exposed the driver to a risk of injury. In the light of the evidence upon which the jury was asked to determine this issue, we are quite unable to regard their verdict as one which can be categorized as "unreasonable" or relevantly "perverse". Accordingly, we reject this ground of appeal.

Grounds (iv) and (v) - Insufficiency of Directions on calculation of pecuniary loss

86. These two grounds were argued together. Two separate contentions were raised in support of the submission that his Honour had failed to give adequate directions to the jury as to how they should calculate pecuniary loss. The first submission was that his Honour had failed to adequately instruct the jury that they should discount for "contingencies" any amount awarded for future economic loss. The second contention related to what was said to be the judge's failure to further instruct the jury as to the calculation of past economic loss in compliance with a stated intention that he would do so. This was the matter to which we have briefly adverted. The first contention was not put with any vigour, no doubt because no exception was taken in respect of it by trial counsel. It is true that the directions which were given in relation to contingencies were bound up with the directions being given to the jury about the respective cases being made by the parties; but they were nevertheless full and appear on their face to embrace a requirement that the jury's award in respect of future loss must make allowance for contingencies. The form which the directions took was no doubt shaped by the submissions by counsel to the jury which had fully dealt with the issue. In dealing with the evidence relating to future loss, and the aspect of contingencies of which the "agreed multiplier" took no account, his Honour said:

"The first question for you is what the plaintiff's earning capacity would have been had it not been for the accident. Now, you cannot assume, even if the accident did not occur, that he would have been certain to earn week in and week out, a particular amount of money, the amount he was earning before the accident. Other things may have prevented it, he may have fallen ill and so on. And so there are problems regarding ill health, unemployment, accidents, industrial disputes. And ..., as [counsel for Brambles] has pointed out there are positive and negative matters. He might, on the one hand, not be able to work for some other reason but if ... his general capacity to work in the future is limited because of the injury ... then those things tend to balance out a bit because he will be a person who has a restriction of available work provided you were satisfied ... he is unable to do heavy work, truck driving work, work that requires lifting, standing or whatever it is. ... The plaintiff says you do the figures, reduce it by about 10-15 per cent ... The defence says well, look, that is really putting it at its highest and ... takes into account the fact that you are basing it on a man working or intending to work injury free to the age of 65 and you have to make some allowance. ... You might say well, he may well have retired from work earlier and that is one of the factors that you have got to make some fair and reasonable judgment about."

90. In our view these directions, in the context of the addresses which counsel had made to the jury, were quite sufficient to bring home to the jury that any amount awarded for future economic loss had to take account of the "vicissitudes" or "contingencies" of life. The directions were cast in such a way as to inform the jury that such an award must be discounted for such contingencies. The sufficiency of the direction appears to have been accepted by counsel because, as we have noted, it prompted no exception. Accordingly, even if the directions were not as explicit as they should have been, and to that extent erroneous, we are far from persuaded that a substantial miscarriage of justice has occurred[9]. In our opinion, the lack of emphasis in the direction, of which the appellant now complains, could not reasonably have influenced the result. It is not suggested that the damages awarded are out of proportion to the injuries. This aspect of grounds (iv) and (v) must therefore be rejected.

93. The final ground argued by the appellant - and the one described by senior counsel as his "killer point" - was the ground which alleged that the judge failed to properly direct the jury as to the basis upon which they should calculate "past" economic loss and, having agreed to recall the jury and re-direct them, failed to do so. The genesis of this ground, it was submitted, was the failure by the judge to recognize a significant distinction between what was disclosed in Wail's tax returns for the years 1992 and 1993 as to his earnings from "truck deliveries for Brambles", and what was disclosed in a "wage and salary book" produced by the secretary of Andar and exhibited at trial as Exhibit D. The appeal books delivered to this Court contained copies of the tax returns but did not contain a copy of the contents of Exhibit D which, we were told, was "missing". That fact has not made our task in relation to this ground of appeal any easier, particularly because we were told that its entries were casually made and did not cover a complete income year.

96. In directing the jury as to the evidence bearing upon Wail's "past income loss", his Honour correctly told them that the income tax returns, which the jury had before them, disclosed a gross taxable income of $33,000 for the year ended June 1992, and a gross taxable income, for the year ended June 1993, of $39,000. His Honour then referred to the argument of Wail's counsel indicating that, taking an average over the two years, the jury could be satisfied that Wail was earning a net income of about $500 per week or $25,000 per year. In this respect his Honour said:

"Now there does not seem to have been any significant challenge or dispute to the fact of what his earnings were in 1992 and 1993 and you might think therefore that the basis upon which the argument of the plaintiff [is] being put as to the average being around about ... a little under $25,000 per year, being his net loss during that period, is reasonable."

100. This direction attracted an exception from both counsel; counsel for Wail contending that, by suggesting that he had "averaged" the two years to arrive at his starting point, his Honour had "watered down" the basis upon which he had invited the jury to consider past loss. He had told them, so counsel contended, that the 1993 tax figures were the best representation of Wail's pre-accident earning capacity. On the other hand, counsel for Brambles and Andar complained because the direction failed to adequately instruct the jury of their argument to the effect that Exhibit D was the best evidence of pre-accident earnings; and that reflected net weekly earnings of $400 per week; but - having regard to the incompleteness of the exhibit - rounded up, on one view, to a figure of $24,000 per year.

103. The debate in this Court centred upon whether the judge had resolved to direct the jury further upon the evidence in respect of these matters, and had failed to do so to the prejudice of Brambles; or whether the judge had ultimately resiled from his initial inclination and had determined that the difference between the parties was "de minimis" and unworthy of further directions from him, the jury having had the benefit of full submissions from counsel. The debate "waxed and waned" over some 16 pages of transcript, during the course of which it appears that his Honour was becoming somewhat terse with the third party's counsel (who was not counsel before this Court) for wanting him to put an argument already put, and which depended for its validity upon an incomplete and "shoddy" document. Shortly before the luncheon adjournment, he said to counsel for the defendant and the third party:

"If you want to do that arithmetic so that I can direct the jury, then do it. Might I say this : it would be very helpful to judges in directing juries ... if people want arguments like this put, that counsel don't come up with a wheelbarrow full of garbage and tip it on the doorstep of the judge and say, you sort it out. If you want to go away over lunchtime and prepare - based on the evidence - the figures that you say are appropriate, that come from the evidence ... then give them to me so that I can put it ... then I will consider it, but don't expect that it is the role of the trial judge to carry out the ... function of counsel."

Again, immediately before his Honour rose for lunch he said, as already stated:

"I will bring the jury back because I must direct them with respect to the figure for past loss and direct them, generally, on the issue as to future loss and the basis of calculation that is being put to them ....".

It would seem, however, that, after the luncheon adjournment, his Honour had changed his mind. Counsel for the third party came back to court with some hand-written notes upon which she contended that the further directions should be based. Having taken his Honour through what was regarded by her as a basis for re-direction, his Honour said that he did not regard such material as "establish[ing] a proper evidentiary basis" for the argument which counsel wished to be put in re-direction. His Honour again told counsel that the lack of appropriate evidential material confirmed his view that the income disclosed in the tax returns was not "seriously challenged". He said:

"I still don't think, even from what you're saying, is that it ends up being seriously challenged."

As we have noted, the transcript then records that the jury had sent a message that they wished to return. It appears that they had arrived at their verdict; but the transcript does not record that fact. As we have already said, his Honour's last statement to counsel before the jury was brought into court was:

"What I rather gather about all of this is that a whole lot of stuff was thrown up in the air without any suggestion of what conclusion or otherwise could be drawn from it and I don't know that there is a great deal of merit in repeating such a vacuous argument, quite frankly."

That appears to have been accepted by counsel as the end of the matter because counsel for the third party is recorded as saying:

And neither counsel for the defendant nor counsel for the third party is recorded as having made any objection to the jury then returning their verdict, as counsel must by then have known they were about to do.

116. We have set out in some detail the relevant passages in the transcript because the primary basis of this ground of appeal was that there was a denial of justice to Brambles because the judge failed to re-direct the jury on the issues as to past loss when he had indicated to the parties that he would do so. In essence, it appears to be suggested that there was a denial of justice to Brambles and a miscarriage of justice occasioned by it. In any event it is contended that the judge should have further directed the jury because the evidence revealed that there was a real discrepancy between the income disclosed in the tax returns and that disclosed in Exhibit D.

119. In our opinion neither of these arguments has merit. It is tolerably clear from the exchanges to which we have referred that, by the time the jury returned to court to deliver its verdict, the judge had made up his mind that he was not going to redirect on the issues of past economic loss, that counsel understood that, and accepted it. His Honour's reasons for his conclusion were also clear; namely that the tax returns were the best evidence of Wail's pre-accident earnings, and that the "wage and salary book" upon which counsel for Brambles was relying displayed incomplete records on its face and, on one view, was consistent with a receipt of annual income of some $24,000 net per year, which was about the same as that for which counsel for Wail was contending. Hence, his Honour had concluded that he was not in error in telling the jury that there was "no real dispute" about the pre-accident earnings. We are not persuaded, on the material presented to this Court, that natural justice was denied to Brambles because the judge failed to do what he said he was going to do. Nor are we satisfied that his Honour misdirected the jury on the question of past economic loss. Upon any view of the evidence, we think the judge was correct to conclude that the tax returns were the most reliable record of Wail's pre-accident earnings, the 1993 income year having just concluded before the accident occurred. Although we do not share the judge's advantage of a familiarity with the "wage and salary book", we have no reason to doubt his Honour's description of it as "shoddy" and "incomplete". Indeed it was not suggested in this Court that those descriptions were inaccurate. In these circumstances, it seems to us that his Honour was right in declining to further direct the jury to put an argument of counsel, which had already been made by counsel, and which it was unnecessary to repeat in circumstances where the judge was entitled to regard the evidentiary foundation for it as inadequate and potentially misleading. Once again, it is not suggested that the jury's award of damages for pecuniary loss was unreasonable on the evidence before them. In the circumstances, we are not persuaded, even if his Honour was in error in failing to re-direct on this issue, that any substantial miscarriage of justice has been occasioned. Accordingly, we reject these grounds.

122. For the reasons which we have assigned, the appeal by Brambles against the jury's verdict must be dismissed.

Appeal against the judgment in the Third Party Claim

(a) The claim for contribution and indemnity under s.23B(1) of the

Wrongs Act 1958

128. The third party notice issued by Brambles against Andar alleged that Andar as Wail's employer had a legal duty to provide Wail with safe plant and equipment and to put into operation a proper and safe system of work. It further alleged that if Wail suffered injury, that injury occurred as a result of negligence on the part of Andar, its servants and agents. The particulars of negligence alleged against Andar were identical to those alleged by Wail against Brambles. Shortly put, Brambles' case against Andar was that it was Andar, not Brambles, which provided Wail with a place of work. Brambles provided Andar with trolleys of linen to deliver to and collect from certain hospitals. The jury's verdict established that the trolleys were not safe to use. Andar had a duty to take reasonable care in making the trolleys and the system of handling them safe, and also had a duty to ensure that reasonable care was taken to that end. On the evidence there had clearly been a breach of the duty owed by Andar to Wail to provide a safe system of work.

131. In rejecting Brambles' claim against Andar, the trial judge in his reasons dated 6 June 2001 said that on the evidence before him any decision of Andar was in reality a decision of Wail himself and that it was true to say that it was Wail who controlled Andar rather than the other way round. His Honour accepted, however, that Andar owed a duty of care to Wail, which was non-delegable. His Honour continued in two passages (in which we shall substitute the individual names of the parties for the words "plaintiff", "defendant" and "third party") as follows -

"the only person with knowledge of the system was Wail. Any knowledge of Andar, was in fact the knowledge of Wail. It follows that had Wail been an employee who had no connection with Andar, other than being an employee, the failure by Andar to ensure that a safe system of work was in place would amount to a breach of the duty of care owed by Andar to Wail."

His Honour then said that had Wail not been in effective control of Andar it would have been necessary to determine the extent of Andar's contribution to Wail's injury, and that in determining that question his Honour would have found the jury's finding as to contributory negligence very reasonable in the circumstances of the case. His Honour continued that what the finding meant in the circumstances of this case was that -

"Andar required Wail to carry out his duties with the equipment and system adopted by Andar. It was Wail who in fact knew the system and as director of the company informed the company as to the system and equipment. It follows in my view, that the finding by the jury of contributory negligence by Wail of 35 per cent, means that in the circumstances, Andar has a liability of not more than 35 per cent for the injury to Wail. I am unable on the evidence, to conclude that there is any way in which it could be considered that Andar could be held to be responsible to any greater extent. In so finding, I am not concluding that an employer in the position of Andar, could not be liable to a greater extent than the contributory negligence of the employee. I come to the conclusion I have, based upon the actual facts and circumstances of this case. In other circumstances it will often be the case where an employer in the position of Andar, may be partly responsible, where there is no finding of contributory negligence on the part of the employee. In this case however, I am of the view that Andar as employer, could not be found to have been negligent to a greater extent than the plaintiff himself."

The judge then said that in vicarious liability the same conclusion was inevitable, since Andar could not be held more than 35 per cent liable to Wail and therefore the amount required to be paid by Brambles to Wail was the amount of its liability already reduced by any amount shown to be the responsibility of Andar.

138. In argument before the judge Brambles had relied upon the decision in Nicol v. Allyacht Spars Pty. Ltd.[10], but the judge found that this case supported the contention of Andar rather than Brambles. His Honour said of Nicol that in his view it "supports the conclusion that the fact that an employee is also a director of the employer company does not absolve the employer from liability. In order for the employer to escape liability, it would need to be the case that the employee was responsible for his own injury."

141. In this Court, Mr Forrest for Andar submitted that Andar had engaged employees including Wail to perform the delivery work in July 1993, but Wail directed those employees how they were to perform their work and what precautions they were to take. It was Wail who was responsible for the operation conducted by Brambles and for the use of the trolleys involved in the transportation of hospital linen. Wail had given evidence during the trial as to the involvement of his co-director, Parker, in the business, that Parker "never truck-drived" and "didn't really have any involvement in the truck driving, the trucking aspect of the business" ... "his role was the wages". Mr Forrest's submission was that the evidence that Parker had no involvement with the Brambles linen operation and that his role was directed solely to certain bookkeeping functions was unchallenged. The submission ran that there was no evidence whatever that Parker had any involvement in instructing or directing Wail in performing any duties relevant to truck driving and delivery of hospital linen, or indeed instructing or directing in any manner at all any employees of Andar in their work activities. The judge had correctly found that Wail had the actual task of conducting the affairs of Andar and that he had effective control of its activities. It followed therefore that if Andar had a duty to take reasonable care in making the trolleys and the system of handling them safe then the only person with a responsibility on the part of Andar for complying with that duty was Wail, and, whatever Andar's breach of duty may have been, that breach of duty consisted of or was co-extensive with Wail's negligence. It followed that there was no liability in Andar to Wail, and s.23B(1) of the Wrongs Act could not apply. Mr Forrest relied on Nicol v. Allyacht Spars Pty. Ltd. and Ginty v. Belmont Building Supplies[11].

144. The decision in Nicol requires a careful examination of its facts. Allyacht Spars supplied a flagpole to one of its customers. Some time after the flagpole had been installed the customer found that the advertising banner attached to the flagpole was not hanging correctly and asked that the banner be checked and replaced. Allyacht Spars agreed to carry out the work. The company had three directors, each an employee. One of them, Nicol, was engaged in general duties, and the others, Gray and Berg, were largely concerned with other matters. Before undertaking the work, Berg had discussions with other employees of the company about the way in which it should be done. To reach the banner, some 27 feet above the ground, Berg and Nicol mounted a trestle on the back of a utility vehicle, and attached an extension ladder to the trestle. Nicol climbed the ladder but while he was working on it one of the feet of the trestle closed and the other skidded across the tray of the utility, dislodging the ladder and causing Nicol to fall to the ground and suffer injury. Nicol brought action against Allyacht Spars for damages for negligence, but his claim was dismissed at first instance, and in the Full Court of the Supreme Court of Queensland, on the ground that the unsafe system of work was Nicol's own system, so that he could not complain of its inadequacy.

147. On appeal, the High Court held that the system of work was unsafe and that Nicol was not disabled from complaining of it on the ground that it had been devised by him. A majority of the Court, with Dawson, J. dissenting, held that Nicol was guilty of contributory negligence in acquiescing in the use of the system and helping to put it into operation and that his damages should be reduced by 40 per cent. In a passage relied on by Mr Forrest for Andar, Mason, C.J., Toohey and Gaudron, JJ. said[12] that -

"If the appellant's injuries were caused solely by his own fault, he cannot succeed. However if they were caused partly by his own fault and partly by the fault of other employees, the appellant's claim is not defeated but is subject to apportionment. ... The cause of the appellant's injuries was the provision of a means of access to the banner which was simply unsafe. That was not solely the fault of the appellant. It was in part his fault in acquiescing in the use of the system and helping to put it into operation. But it was also very much the fault of those who devised the system. The respondent must be held vicariously responsible for the appellant's injuries."

In his dissenting judgment, Dawson, J. referred to the proposition that an employee cannot succeed in an action against his employer for breach of statutory duty where the employee's conduct is that which is at fault and then said[13] -

"Even if the above principle can be applied in the absence of any statutory duty which, as can be seen from what I have already said, I doubt, it does not seem to me that the duty of an employer and an employee in such regard can ever be co-extensive or co-terminous. The duty is that of the employer and even if the employee is entrusted with its performance it remains an independent obligation of the employer of a more comprehensive kind to ensure that reasonable care is taken. The personal or non-delegable nature of the duty was recently discussed by Mason, J. in Kondis v. State Transport Authority and there is no call for a repetition of the discussion here. It is sufficient to say that in my view it precludes the imposition upon an employee of the same burden as is shouldered by the employer and even if in the failure to take steps to avoid the unnecessary risk of injury the employee is at fault, that fault will arise from the breach of a lesser duty than that of the employer, or, perhaps more accurately, a duty of a different kind. Of course, there can be no recovery by an employee who has failed to take reasonable care for his own safety where the employer has discharged his obligation to provide proper equipment and a safe system of work and has taken reasonable steps to ensure that they are used ... That, however, is a different situation."

Dawson, J. then referred to the fact that the decision to employ the equipment and the system used by Nicol had been made before Nicol embarked upon the work, noting that the case which had been made against Nicol was that although the decision to use the system was a company decision it had nonetheless been made by Nicol as a director or employee and the fault, if any, was the fault of Nicol himself, Nicol thus being the cause of his own injuries even though it was a decision in which he played only a minor part. His Honour continued -

"But major or minor, it was a part played, either as a director or an employee, in the control of the activities of the company and the actual omissions which resulted from the implementation of the decision taken were the acts or omissions of the company. The failure to take reasonable steps to provide adequate equipment and a safe system of work was the failure of the company and it matters not that the plaintiff was instrumental in the making of the decision which led to that failure, for the company was a legal entity distinct from its directors and employees. Any duty owed by the directors or employees of the company to see that the company went about its affairs in accordance with its legal obligations was not a duty owed to themselves or other employees of the company but a duty owed to the company itself. It was a duty of a managerial kind which arose out of their position or employment and was different from the duty owed by the company to its employees. It is for these reasons that it was the fault of the company and not of the plaintiff which was the cause of the plaintiff's injuries, notwithstanding that the plaintiff may have played some part in the decision which gave rise to that fault."

155. We have quoted from the judgment of Dawson, J. at considerable length because, in our view, it is a correct statement of the law with direct application to the facts of the present case. Dawson, J. dissented only on the question whether the plaintiff was guilty of contributory negligence, saying that the risk of injury to Nicol arose from the nature of the equipment provided and the system devised by the company, and that it had been the inadequacy of the steps taken by the company to avoid unnecessary risk to Nicol which had been the cause of his injuries. This, in his Honour's view, could not amount to contributory negligence. Mr Curtain for Brambles argued that the observations of Dawson, J. quoted above were entirely consistent with the reasoning of the majority, who had not found it necessary to carry their analysis to the length taken by Dawson, J., they having arrived at their conclusion simply on the basis that Nicol was not solely at fault.

158. Valkonen & Valkonen v. Jennings Construction Ltd. & Ors[14] was a case with considerable similarity to the present. Aki Valkonen was badly injured when he fell from a mobile scaffold at the site of a supermarket then under construction. Jennings Construction Ltd. was the building contractor which engaged Ceilfix Pty. Ltd. to erect the ceiling of the supermarket. Ceilfix in turn contracted with The Scaffold Connection Pty. Ltd. to construct the scaffold from which Ceilfix's staff would carry out the ceiling work. Valkonen fell from the scaffold when one of its horizontal railings gave way and he and his wife sued The Scaffold Connection for not erecting the scaffolding properly and Jennings for failing to carry out an adequate inspection of the scaffold. Both defendants brought in Ceilfix as a third party on the ground that as Valkonen's employer it had failed in its duty to provide a safe system of work. Jennings also claimed that Ceilfix had in any event contracted to indemnify it against any such claim as this, the same claim as Brambles makes against Andar in the present case.

161. At first instance the judge acquitted both Ceilfix and Valkonen of any contributory negligence, holding that The Scaffold Connection should bear 80 per cent and Jennings 20 per cent of the responsibility for Valkonen's injuries. Jennings' claim for indemnity under the contract with Ceilfix was dismissed.

164. On appeal, Cox, J. said of the third party claim against Ceilfix[15] that -

"Ceilfix was the plaintiff's employer. It therefore owed the plaintiff the employer's usual common law duty of care including the obligation to provide him with a safe place of work. The duty was not abrogated or lessened by the circumstance that the plaintiff was also a director of the employer company; Nicol v. Allyacht Spars Pty. Ltd. It was a non-delegable duty which meant that Ceilfix not only had a duty to take reasonable care in making the plaintiff's workplace safe but it also had to ensure that reasonable care was taken to that end. Ceilfix, therefore, could not hand over its responsibility to Scaffold Connection and claim that it was justified for one reason or another in reposing its confidence in that company, because the consequence of the special relationship of master and servant meant that Ceilfix was for practical purposes liable for any negligence on the part of its contractor in failing to build the scaffold properly. I say `for practical purposes' because, strictly speaking, Scaffold Connection was not providing the plaintiff with a place of work; Ceilfix was. Scaffold Connection simply built a mobile scaffold which Ceilfix, without making any inspection of its own, then required its workmen to use. On the learned judge's findings the scaffold was unsafe and it follows that Ceilfix was in breach of its duty to the plaintiff. ... There is no doubt, of course, that the breach in this case was a cause of the plaintiff's injuries. Ceilfix must therefore, in my opinion, share with Jennings and Scaffold Connection in the responsibility for the plaintiff's loss and damage."

168. Cox, J. then said that Valkonen was an executive director of Ceilfix and the foreman on this job. He had decided, jointly with his brother, what sort of scaffold was needed and was the one in de facto charge of the ceiling work. His Honour continued -

"It was therefore his task to ensure that Ceilfix's duty to provide its workmen with a safe place of work was carried out properly. That meant effectively that someone from Ceilfix - most obviously but not necessarily the plaintiff himself - should have inspected the scaffold before any of the Ceilfix workmen used it. The plaintiff knew that this had not been done."

Accordingly Cox, J. found that the plaintiff failed to take reasonable care for his own safety and on that view there were four parties between whom responsibility had to be apportioned for the plaintiff's damage, Jennings, Scaffold Connection, Ceilfix and Valkonen himself.

173. As was the case in Valkonen, it was not Brambles that was providing Wail with a place of work, rather it was Andar. Brambles supplied Andar with trolleys and linen to deliver to and collect from various hospitals, and the jury's verdict shows that the trolleys were not safe to use. It necessarily follows that since Andar had a duty to take reasonable care in making the trolleys and the system of handling them safe, there was a breach of Andar's duty to Wail to provide a safe system of work.

176. Mr Forrest then argued that if Andar was in breach of its duty to Wail, the only person with a responsibility on the part of Andar for complying with that duty was Wail himself. Whatever Andar's breach of duty, Mr Forrest argued, that breach consisted of or was coextensive with the negligence of Wail, and it followed that Andar was not liable to Wail.

179. We do not accept this argument. As was said by Dawson, J. in _Nico_l[16], the duty of the employer and the employee cannot be regarded as co-extensive or co-terminous. The non-delegable nature of that duty precludes the imposition of the same burden upon an employee as is shouldered by the employer. The failure to take reasonable steps to provide a safe system of work was the failure of Andar, and was quite different from the duty which Wail in his managerial capacity as director owed to the company. Furthermore, the assertion that Wail was solely responsible for the failure of Andar to provide a safe system of work ignores the fact that Andar's responsibility was to be exercised through the board of the company. Wail was no doubt principally involved in conducting the affairs of Andar, but any other member of the board was just as much responsible for ensuring that the company provided a safe system of work for its employees, and Parker, as another member of the board, could not have absolved himself of responsibility for Andar's breach of duty by leaving everything to Wail; compare Morley v. Statewide Tobacco Services Ltd.[17]

182. In the present case the trial judge, in our view, with respect, failed to consider separately the distinct obligation on Andar as employer to provide proper equipment and a safe system of work, and to take reasonable steps to ensure that they were used. His Honour said that he had not determined the case on the basis of the liability of Wail and Andar as being coextensive, but that he considered Andar's liability as falling within the 35 per cent contribution which he apportioned to Wail on account of his contributory negligence. In this respect also we would take a different view. It is well-established, of course, that any contributory negligence of a plaintiff must be determined separately from the liability of a third party. The causes of action of a plaintiff against various tortfeasors must be kept distinct from the causes of action of the tortfeasors against one another, and it is the rights of the plaintiff which must be determined first: Barisic v. Devenport & Ors[18]. Furthermore, in Esso Australia v. V.W.A.[19], Winneke, P. said -

"The apportionment of blame between the two fell to be assessed by making a comparison of the significance of the respective departures from the relevant standards of care required. Such a comparison involves matters of relative emphasis, proportion and value judgment upon which reasonable minds might differ ...".

186. Mr Forrest also relied on Ginty v. Belmont Building Supplies Ltd.[20], in which Pearson, J. held that a plaintiff was not entitled to recover damages against his employer since, although the plaintiff, and through him his employer, were both in breach of the same statutory duty, yet the fault was the plaintiff's, and there was no fault on the part of the employer which went beyond or was independent of the plaintiff's own omission. That, in our view, is a very different case from the present. For the reasons we have already given the liability of Andar here can be seen to be separate and distinct from that of Wail to Andar.

189. Upon the basis of a notice of contention, Mr Forrest also submitted that the damages in the principal proceeding assessed against Brambles had been reduced by the jury to take account of the finding of contributory negligence. He argued that this finding took account of the "causative fault" of Wail which was the fault of Andar and identified accurately Brambles' share of the responsibility, ie, 65 per cent. He submitted that in circumstances where a reduction has already been effected to establish the true levels of responsibility it would not be just and equitable to award contribution, such an allowance representing merely a "windfall" for Brambles. Reliance was placed on Pennell v. O'Callaghan[21]; Doyle v. Pick & Rickwood[22]; and Daniels v. Anderson[23]. Moreover, so the argument ran, an apportionment by trial judge should be disturbed on appeal only when it is clear that the discretion of the trial judge had miscarried or that the determination reached was not "reasonably open". Accordingly it was submitted that the judge's finding ought not to be disturbed.

192. The windfall argument is well demonstrated by a passage in the judgment of Jackson, J. in Doyle v. Pick & Rickwood, where his Honour said[24] -

"The amount recoverable is such as is found to be just and equitable. As the damages awarded against the defendant correspond exclusively to his own share of the responsibility and the negligence of the third party has already been taken into account in arriving at those damages, it would not be just and equitable that the defendant should have any recovery against the third party. If it were otherwise, then the third party would have to pay twice, because he is liable at the suit of the plaintiff for his share of the responsibility for the damage. This opinion, which I advanced during argument at the hearing, has, I am glad to find, the support of Professor Glanville Williams in his book on joint torts and contributory negligence ..."

196. The examination we have previously made of the respective breaches by Andar and Wail immediately provides the answer to this argument. Since the duties imposed on Andar and Wail were quite distinct and different, for all the reasons previously given and in particular by reference to what was said by Dawson, J. in Nicol v. Allyacht Spars, it could never be said in the present case that the negligence of Andar had been taken into account in arriving at the damages awarded to Wail.

199. It follows that Andar was liable to contribute to the damages recoverable by Wail from Brambles pursuant to s.23B(1) of the Wrongs Act. But before attempting any apportionment of the necessary contribution to be made by Andar we should first turn to the claim for indemnity under the contract.

(b) Brambles' claim under the Contract of Indemnity against Andar

(i) Did the contract of indemnity remain in force and binding upon Andar?

205. The terms of the indemnity relied upon are to be found in the Independent Trucking Contractor Agreement dated 28 March 1990 made between Princes Fabricare Services, a Division of Brambles Holdings Ltd.[25], and Andar, and in particular clause 8.2 thereof.[26] The first question falling for decision on this branch of the case is whether the judge ought to have found that the terms relied on were not in force at the time at which Wail suffered his injuries. That question is raised by Andar's notice of contention, since the judge decided that question in favour of the appellant Brambles. His Honour said:

"The facts indicate that from the time the Agreement was entered into until the time of the injury to the Plaintiff, the Third Party continued to carry out the Delivery Round in the same manner it had all along. The Defendant continued to make payments to the Third Party in accordance with the agreement. I am of the opinion that although there was no written extension of the original agreement, both parties by continuing as they did, purported to be acting in accordance with the terms of the original agreement. I agree therefore with the submission of the Defendant that the entire terms of the written agreement continued to bind the parties, with the exception of the specified term of 3 years."

It might be sufficient to say that we entirely agree with those reasons and accordingly reject this answer by Andar to Brambles' appeal on indemnity. But, out of deference to Mr Forrest's argument, we amplify our reasons.

210. In the statement of claim accompanying its amended third party notice Brambles, so far as presently relevant, simply pleaded the agreement dated 28 March 1990 and the terms of it on which it relied. But by clause 1 of the agreement, read with the page bearing the attestation clause[27], the mutual obligations assumed by Brambles and Andar under the agreement ran only for the term of three years from the commencing date of 4 April 1990, and in oral argument Mr Curtain's submission for Brambles was that the agreement was impliedly extended by reason of Andar's continuing to do the work in return for the weekly payment stipulated in the agreement. The only inference, he submitted, was that the agreement continued on the same terms save as regards duration and termination, as to which the continued agreement must have been terminable on reasonable notice. In response, Mr Forrest submitted that Brambles had not discharged the onus on it to prove by evidence that the agreement, including the clauses relied upon, was in existence at the date Wail was injured. Thus, Brambles could not, for instance, after 4 April 1993 compel Andar to change the round and continue servicing it. He pointed out that clause 8.2 applied "whether during or after the currency of the Agreement" and he relied on clause 1 and clause 15.1, the latter of which provided that the provisions set out might not be altered, modified or varied except by agreement in writing signed by the parties. What was needed, he submitted, was an agreement to extend, showing an intention to do so. The provision of and payment for services could not create an extension. The inference that the agreement was in force three months after it had ended was not open, especially in the light of the draconian clause 8. Some evidence was needed that Andar had agreed to the continuation of liability under clause 8. No doubt some informal arrangement was in force, but it did not include clause 8.

213. Both parties to this appeal sought, we think, to extract from the evidence and course of proceedings concessions and implications which cannot be sustained. The relatively meagre evidence did, however, show that from April 1993 until the time when Andar sold its trucks and delivery rounds it continued to conduct the linen delivery and collection service in exactly the same manner as it had done between April 1990 and April 1993. In particular, Wail identified in cross-examination a book containing invoices (presumably copies) from Andar to Brambles for the period from 7 January 1992 to 1 September 1993 and said that the weekly amounts invoiced in respect of the two trucks (including the one in question here) were paid to Andar; and later in his cross-examination he said that from July 1993 until the time the relevant truck was sold he continued to invoice Brambles on a weekly basis on behalf of Andar, employing a driver to conduct the round.

216. It is not easy to find much discussion in the books or case law, except in North America, of the question whether the terms of a detailed written agreement for a fixed term continue, after that term has expired, to govern the parties to it where they continue dealing with each other. However, the following appears in Chitty on Contracts[28]:

"There may also be an implied contract where the parties make an express contract to last for a fixed term, and continue to act as though the contract still bound them after the term has expired. In such a case the court may infer that the parties have agreed to a newly expressed contract for another term."

There is, as it happens, an early Victorian decision illustrative of that passage. In Bullock v. Wimmera Fellmongery and Woolscouring Co. Ltd.[29] the appellant (as he may be called) had been appointed manager and accountant of a company at a certain annual salary with a house rent-free, the appointment being expressed to be for one year only, "then to be at the option of the shareholders" of the company. The engagement ran on without interruption for some 15 months, when the appellant was given notice of termination. In holding that there should be a new trial, Stawell, C.J. said[30] that there was a "tacit consent", on both sides, to a continuance of the engagement and that, the defendants not having altered the terms of it, the plaintiff had just grounds for maintaining that the terms of his engagement continued as before. Barry, J. stated[31] that an implied contract arose that the period of service was to be for another year, on the same conditions as those binding on the parties during the previous year.

221. Three other Australian cases where the question was considered have come to our attention. Two[32] may be put aside immediately as containing no substantial discussion but turning on the interlocutory nature of the proceedings in question or fact findings. In the other case, Cawsand Pty. Ltd. v. Normans Wines Pty. Ltd.[33] the expired written agreement was a short one which did not contain all the terms agreed upon. In those and other special circumstances of the case Brooking, J. declined to infer agreement as to a term for a particular period of notice of termination in the implied replacement agreement. Significantly for present purposes, however, his Honour distinguished the case "of a lengthy written agreement containing numerous terms governing the relationship between the parties, including one concerning notice, where the parties have so acted as to lead to the inference that notwithstanding the expiration of the term they regard the provisions of the agreement as still governing their relationship".

224. Because of the paucity of Australian cases on the subject it is helpful to consider at a little length North American cases, where the basis for the inference is elaborated further. The American position is summarised, in terms similar to those in Chitty, in Corbin on Contracts[34] as follows:

"Parties who have made an express contract to be in effect for one year (or any other stated time) frequently proceed with performance after expiration of the year without making any new express agreement, of extension or otherwise. From such continued action a court may infer that the parties have agreed in fact to renew the one-year contract for another similar period. Illustrations can be found in leaseholds, employment transactions and contracts for a continuing supply of a commodity...".

In one of the cases cited by Corbin, Steed v. Busby[35] the Supreme Court of Arkansas, having stated that in determining whether a "tacit"[36] but actual contract exists the prior course of dealing between the parties is to be considered, went on:

"When an agreement expires by its own terms, if without more the parties continue to perform as before, an implication arises that they have mutually assented to a new contract containing the same provisions as the old, and the existence of a new contract is determined by an `objective' test, i.e., whether a reasonable man would think, from the actions, that they intended to make a new binding agreement. ... In such a case, when the parties continue to do business together, their conduct may permit, or even constrain, a finding that they impliedly agree that their rights and obligations should continue to be measured as provided in the old contract. New York Telephone Co. v. Jamestown Telephone Corp.[37]. "

In the New York Telephone Co. case, after the passage referred to in Steed v. Busby, Lehman, C.J., speaking for the Court of Appeals of New York, had stated[38]:

"Even in such a case, however, the reciprocal obligations arise from the new implied contract and, unless an intent to make such a new contract is expressed or may be fairly inferred from the conduct of the parties, the obligations of the parties are as matter of law not measured by the terms of the contract which has expired."

In another decision of the last-mentioned Court, which cited the passage from an earlier edition of Corbin corresponding to that set out above and is in turn cited in the current edition, Cinefot International Corp. v. Hudson Photographic Industries[39] Desmond, C.J., speaking for the majority, stated[40] that the rule that there was available an inference or implication of fact that the parties intended to renew was not really one of substantive law, but of evidence. His Honour said that entering into a contract to run for a year, and then continuing to act as if its time had not run, was sufficient evidentiary support for a finding that the parties in fact intended to keep it alive for another year. The contract in that case was classified as an agency agreement and the principle was stated not to be limited to leases and employment contracts. There are other United States cases to the like effect to those already cited, such as Teachers Insurance and Annuity Association of America v. Ormesa Geothermal[41]; Foster v. Springfield Clinic[42]; and Consolidated Bearings Co. v. Ehret-Krohn Corporation[43].

233. There are cases in Canada to the same effect, such as Mitchell Energy Corporation v. Canterra Energy Ltd. and Kidd Creek Mines Ltd.[44] and Imasco Retail Inc. v. Blanaru[45]. In the former the passage from an earlier edition of Chitty on Contracts corresponding to that set out above was applied to the facts.

236. Here the written agreement came to an end on 4 April 1993. The question whether an implied or tacit agreement to continue dealing on the same terms save that the agreement should be terminable on reasonable notice is to be inferred is, as Desmond, C.J. stated and as the other cases and the treatises make abundantly clear, an evidentiary or factual question. On the facts we have set out earlier we consider such an inference should be drawn here. The evidence, fairly sparse though it is, warrants the finding that after 3 April 1993 the parties proceeded as though still governed by the terms of the original agreement (save that, since it had already expired, either could terminate the substitute arrangement on reasonable notice), rather than a finding that they impliedly agreed merely that Andar should collect and deliver the laundry and that Brambles should pay it a reasonable sum for that or a finding that the parties made a series of individual implied agreements, six days a week, for that work to be done for a reasonable sum. In other words, after 3 April 1993 the parties operated under a standing agreement under which all the procedures and, importantly, the remuneration were exactly the same as they had been under the written agreement. The parties intended that that should be so. The contract thus made was not a mere variation of the original agreement, for it was not made until after the latter had expired.[46] Accordingly clause 15.1, requiring signed written agreement for a variation, did not apply to it. Nor did clause 14.5, the "whole agreement" clause, since it was not apt to apply to a subsequent and separate agreement. Clauses 6.1 and 8.2, for instance, contemplate "renewal" and "extension". Renewal and extension are closely related concepts, normally involving a continuation of the contractual relationship on essentially the same terms and conditions as contained in the original contract. Whether a renewal creates a new contract, or extends the original contract, depends primarily on the intention of the parties as evidenced by the agreement or agreements they have made. Thus, generally an option to renew a contract is the right to require the execution of a new contract[47], whilst an option to extend the term, exercised during the currency of the term, merely operates by way of variation to extend the term of the original agreement.[48] Whether the implied or tacit contract made after 3 April 1993, which cannot be an extension, is called a renewal is really a matter of definition. The important point is that it was a new and separate contract.

239. Brambles relied on cases concerned with the importation of terms into a contract as a result of a course of dealing between the parties, such as Hardwick Game Farm v. Suffolk Agricultural Poultry Producers Association[49], to which may be added, for instance, the earlier case considered in it, McCutcheon v. David Macbrayne Ltd.[50], and also W. Noall & Son v. Wan[51]. Although some of the United States cases cited earlier do refer to a course of dealing, we think that the expression is more frequently used to refer to a succession of individual contracts rather than activities under a single standing or master contract. Be that as it may, we have reached our conclusion without needing to rely on cases such as those just mentioned. Brambles also advanced a quite separate argument, that Andar was estopped by its conduct from contending that the indemnity clauses were not in force at the time when Wail sustained his injuries. We have found it unnecessary to consider that argument.

(ii) The interpretation of the indemnity clauses in the contract

245. By clause 4.3.8 of the agreement, Andar agreed to indemnify Brambles against any and all claims which might be made against Brambles in respect of matters concerning Andar's employees. Then by clause 8.1, Andar agreed to conduct the delivery round at its sole risk and to release Brambles from all claims and demands of every kind and from all liabilities of every kind which might arise in respect of any accident, loss or damage or injury to any person of any nature or kind in the conduct of the delivery round by Andar. Brambles' claim for indemnity was made pursuant to clause 8.2 of the agreement which, making the appropriate substitution of the names "Brambles" and "Andar", provides as follows:

"Andar shall - 8.2 indemnify Brambles from and against all actions, claims, demands, losses, damages, proceedings, compensation, costs, charges and expenses for which Brambles shall or may be or become liable whether during or after the currency of the Agreement and any variation, renewal or extension in respect of or arising from - 8.2.1 loss, damage or injury from any cause to property or person occasioned or contributed to by the neglect or default of Andar to fully, duly, punctually and properly pay, observe and perform the obligations, covenants, terms and conditions contained in the Agreement and on the part of Andar to be paid, observed and performed. 8.2.2 loss, damage, injury or accidental death from any cause to property or person caused or contributed to by the conduct of the delivery round by Andar. 8.2.3 loss, damage, injury or accidental death from any cause to property or person occasioned or contributed to by any act, omission, neglect or breach or default of Andar. Notwithstanding that any of such actions, claims, demands, losses, damages, proceedings, compensation, cost, charges, and expenses shall have resulted from any act or thing which Andar may be authorised or obliged to do under the agreement and notwithstanding that any time, waiver or other indulgence has been given to Andar in respect of any obligation of Andar under the agreement AND PROVIDED ALWAYS it is agreed and declared that the obligations of Andar under this Clause shall continue after variation or termination of the Agreement and any renewal or extension in respect of any act, deed, matter or thing happening before such termination.

249. Brambles claimed to be entitled to rely upon the indemnities in clause 8. In particular it argued that clause 8.2.2 applied because Wail's injury was caused or contributed to by the conduct of the delivery round by Andar. Brambles also argued that if there was a breach of the duty owed by Andar to Wail to provide a safe system of work then, even if on the proper apportionment of blame Andar was only determined to be responsible as to one per cent, pursuant to clause 8.2.3 Brambles was entitled to a complete indemnity from Andar, because the damages payable by Brambles were "contributed to by an act, omission, neglect or breach or default of" Andar.

252. The judge took a very narrow view of the operation of these clauses. His Honour said of clause 8.2.2 that the clause did not require Andar to indemnify for loss, damage or injury which Brambles had caused or contributed to as a result of its negligence. His Honour said -

"Clause 8.2.2 does not refer to negligence and as such is not I think intended to cover damage or injury of the kind suffered by Wail. If Andar is to indemnify Brambles, I am of the view that that obligation can only arise under clause 8.2.3, if at all. It is not the conduct of the round by Andar that 'caused or contributed' to the injury to Wail. It is true that the injury occurred in the course of the conduct of the Delivery Round but it was not the fact of the conduct of the round that caused or contributed to the injury."

256. As to clause 8.2.3, the judge said that the injury was to some extent contributed to by the neglect of Andar but that the damages for which Brambles had become liable were not damages occasioned or contributed to by Andar. His Honour said -

"The overall purpose and intent of clause 8 is in my opinion to ensure that Andar will indemnify Brambles for matter for which Brambles may be held liable as a consequence of conduct of Andar. That is, for successful claims against Brambles where Brambles may be held vicariously liable. Had it been intended that Andar indemnify Brambles in respect of claims against it arising from its own negligence, then that could have been specifically stated, or the clause could have been in terms similar to those in Valkonen. . . . Accordingly I do not agree with the submission of Brambles that the effect of clause 8 is that Andar agreed to indemnify Brambles in respect of all claims arising out of the conduct of the delivery round including claims by Andar's employees, where such claims are caused or contributed to by the negligence of Brambles."

260. In his submissions to this Court Mr Forrest sought principally to rely on the reasons of the trial judge. He added an oral argument that to enliven the respective indemnity clauses it was necessary to establish a causal link between Andar's conduct and the injury giving rise to Brambles' liability, saying that for Andar to be made responsible under the clause there had to be a distinct breach by it beyond any breach of duty by Wail. Mr Forrest added an argument that clauses 8.2.2 and 8.2.3 were not intended to allow Brambles to be indemnified for damage which was the result of its negligence alone. Mr Forrest, however, in effect conceded that if the Court were against him on the argument under section 23B(1) of the Wrongs Act, he could not succeed on the interpretation of the indemnity clauses. We think that this concession is correct, but we will nonetheless deal with his other arguments.

263. The reasoning of the trial judge quoted above appears to be based on the premise that indemnity clauses such as the present should not be interpreted to relieve a party in the position of Brambles of liability for its own negligence. Such a view was indeed propounded in Canada Steamship Lines Ltd v The King[52] for the Privy Council by Lord Morton of Henryton, who said of the interpretation of an exclusion clause that -

"(1) If the clause contains language which expressly exempts the person in whose favour it is made (hereinafter called 'the proferens') from the consequence of the negligence of his own servants, effect must be given to that provision; (2) If there is no express reference to negligence, the court must consider whether the words used are wide enough, in their ordinary meaning, to cover negligence on the part of the servants of the proferens. If a doubt arises at this point, it must be resolved against the proferens; (3) If the words used are wide enough for the above purpose, the court must then consider whether the head of damage may 'be based on some ground other than that of negligence' ... The 'other ground' must not be so fanciful or remote that the proferens cannot be supposed to have desired protection against it; but subject to this qualification ... the existence of a possible head of damage other than that of negligence is fatal to the proferens even if the words used are prima facie wide enough to cover negligence on the part of his servants."

267. The third proposition is not now the law in Australia in relation to the interpretation of exclusion and limitation clauses. In Darlington Futures Ltd. v. Delco Australia Pty. Ltd.[53], the High Court said that -

"the interpretation of an exclusion clause is to be determined by construing the clause according to its natural and ordinary meaning, read in the light of the contract as a whole, thereby giving due weight to the context in which the clause appears including the nature and object of the contract, and, where appropriate, construing the clause contra proferentem in case of ambiguity. Notwithstanding the comments of Lord Fraser in Ailsa Craig Fishing Co. Ltd. v Malvern Fishing Co. Ltd. [1983] 1 W.L.R. 964 at 970, the same principle applies to the construction of limitation clauses. As King C.J. noted in his judgment in the Supreme Court, a limitation clause may be so severe in its operation as to make its effect virtually indistinguishable from that of an exclusion clause. And the principle, in the form in which we have expressed it, does no more than express the general approach to the interpretation of contracts and it is of sufficient generality to accommodate the different considerations that may arise in the interpretation of a wide variety of exclusion and limitation clauses in formal, commercial contracts between business people where no question of the reasonableness or fairness of the clause arises."

271. In Schenker & Co. (Aust.) Pty. Ltd. v. Maplas Equipment and Services Pty. Ltd.[54] the Full Court of Victoria held that this approach was equally applicable to indemnity clauses. In Valkonen, Schenker was applied by Cox, J. in the Full Court when dealing with not dissimilar provisions of the contract of indemnity between Jennings and Ceilfix. Cox, J. said[55] -

"The first and second of the Canada Steamship Lines tests provide acceptable working rules but the third imposes an artificial and inflexible rule of interpretation that is as likely as not to frustrate the intention of the parties. The solicitude for the indemnifying party which explains the rules' creation will often be inappropriate in modern commercial conditions. There may be good practical reasons for providing that one party to a contract shall be indemnified by the other against any liability the former might incur to a third party, even if it is caused by his own fault, and where, as commonly happens, the obligation to indemnify is to be secured by insurance (as in the case of this contract) there is no sound policy reason for expecting the contract term to conform with an arbitrary judge-made textual requirement before its provisions will be given their natural operation. Indeed, a narrow interpretation of such a term is likely in any given case to benefit only the insurance company which writes the obligatory policy in prudently liberal terms and charges appropriately for it."

275. Clause 8.2.2 covers a situation of injury to a person contributed to by the conduct of the delivery round by Andar. Clause 8.2.3 covers a situation of injury to a person contributed to by any neglect or breach or default of Andar. We have already found that the injury to Wail was contributed to by Andar's breach of its obligation to provide a safe system of work, an obligation quite separate and distinct, and of quite a different kind, from any owed by Wail. In their plain and ordinary meaning both clauses are apt to cover the occurrence of the injury to Wail. His injury clearly arose out of and was contributed to by the conduct of the delivery round, the injury having been in part caused by Andar's breach of its obligation to provide a safe system of work. We see no justification for reading down the clauses so as to exclude a situation in which Brambles' negligence was partly responsible for the occurrence of the injury.

278. In dealing with comparable contractual provisions in Valkonen, Cox, J. said[56]-

"The paragraph is not ambiguous. Giving its words their plain and natural meaning, and having regard to the context in which they appear, they are wide enough to include a liability caused by the negligence of Jennings' own servants, and I see no reason to suppose that to interpret the paragraph in this way would not accord with the intention of the parties. They may well have considered that the best course for both of them was to avoid the possibility of disputes about liability among themselves by providing that Ceilfix should satisfy all legitimate claims against one or both of them and then look for reimbursement to the single comprehensive insurer."

282. We agree and would regard these expressions as equally applicable to the present case.

285. It follows that Brambles is, by virtue of either of clauses 8.2.2 or 8.2.3, entitled to be indemnified by Andar against Brambles' own liability to Wail. Since a complete indemnity is given by these clauses it is unnecessary to consider further the question of contribution as between Brambles and Andar.

288. We would allow the appeal by Brambles in the third-party proceeding.

[1] The meaning of that definition was explained in Humphries v. Poljak [1992] VicRp 58; [1992] 2 V.R. 129 at 134-8 per Crockett and Southwell, JJ.

[2] cf. Petkovski v. Galletti [1994] VicRp 32; [1994] 1 V.R. 436 at 437 per Brooking, J.

[3] cf. Angelatos v. Museum of Victoria [1999] VSCA 129; [1999] 3 V.R. 157.

[4] [1959] HCA 8; (1959) 101 C.L.R. 298.

[5] Hocking v. Bell [1945] HCA 16; (1945) 71 C.L.R. 430 at 440.

[6] Liftronic Pty. Ltd. v. Unver (2001) 75 A.L.J.R. 867 at 877 per Kirby, J. (dissenting in the outcome)

[7] cf. Naxakis v. Western General Hospital & Anor. [1999] HCA 22; (1999) 197 C.L.R. 269 at 289-90 per Kirby, J.

[8] Calin v. Greater Union Organization Pty. Ltd. [1991] HCA 23; (1991) 173 C.L.R. 33 at 41; Liftronic Pty. Ltd. v. Unver, supra at 877-8.

[9] Balenzuela v. De Gail [1959] HCA 1; (1959) 101 C.L.R. 226 at 234-5, per Dixon, C.J.; R.S.C. 64.23 Supreme Court (General Civil Procedure) Rules 1996.

[10] [1987] HCA 68; (1987) 163 C.L.R. 611.

[11] [1959] 1 All E.R. 414 at 424.

[14] (1995) 184 L.S.J.S. 87.

[15] At 92 (citation omitted). Matheson and Perry, JJ. agreed.

[17] [1993] VicRp 31; [1993] 1 V.R. 417 at 430 per Ormiston, J.

[18] [1978] 2 N.S.W.L.R. 111 at 120.

[19] (2000) 1 V.R. 241 at 253.

[20] [1959] 1 All E.R. 414.

[21] [1954] VicLawRp 47; [1954] V.L.R. 320 at 322-323.

[22] [1965] W.A.R. 95.

[23] (1995) 37 N.S.W.L.R. 438 at 578-580.

[25] Throughout the hearing of the appeal this company was treated as identical with the appellant.

[26] See also clauses 4.3.8, 4.6 and 14.8.1.

[27] There is a Schedule, headed "Interpretation", appearing after clause 15, by item 17 of which "Term" means the minimum period of the Agreement, being one year. By clause 15.10 the expressions (scil., in the Agreement), unless inconsistent with the context, are to have the meanings in that Schedule. Clearly, however, that meaning was inconsistent with the context constituted by the contents of the specially prepared page referred to in the text.

[29] (1879) 5 V.L.R.(L) 362. The case appears not to have been noticed in any Australian or English decision. It is, however, cited in Williston on Contracts, 4th edn., 1990, vol.1, 452-454, para.6.42.

[32] Caltex Oil (Australia) Pty. Ltd. v. Alan Morris Pty. Ltd. (unreported, Bryson, J., N.S.W. Supreme Court, 1 May 1987) and Insyte Systems Pty. Ltd. v. Ditton (unreported, White, J., Qld. Supreme Court, 7 December 2001).

[33] Unreported, Brooking, J., 21 June 1989.

[34] Rev. edn, 1993, vol.1, 60, para.1.19 (footnotes omitted).

[35] 268 Ark 1; 593 SW 2d 34 (1980) at 38.

[36] This is the word favoured in Salmond & Williams on Contracts, 2nd edn, 24 and used by Stawell, C.J. in Wimmera Fellmongery as already mentioned.

[37] 282 NY 365; 26 NE 2d 295 (1940).

[39] 13 NY 2d 249; 196 NE 2d 54 (1963).

[41] 79 F Supp. 401 (SDNY 1991) at 411 and 415.

[42] 410 NE 2d 604 (1980) at 607, Appellate Court of Illinois, Fourth District.

[43] [1990] USCA7 852; 913 F 2d 1224 (1990) at 1230, US Court of Appeals, Seventh Circuit, where, however, it was held that evidence that the parties were negotiating a new contract rebutted the presumption that the expired contract was renewed.

[44] [1987] 2 WWR 636, Alberta Queen's Bench.

[45] [1995] 9 WWR 44, Manitoba Queen's Bench.

[46] Compare Laws of Australia, LBC, Vol.26, Labour Law, 26.1, "Individual Employment", [164].

[47] Compare Gerraty v. McGavin [1914] HCA 23; (1914) 18 C.L.R. 152 at 163.

[48] The foregoing propositions as to renewal and extension are taken, with some modification, from 17B Corpus Juris Secundum (1999), Contracts, para.500, p.115.

[49] [1968] UKHL 3; [1969] 2 A.C. 31 at 90, 91, 104, 105 and 130.

[50] [1964] UKHL 7; [1964] 1 W.L.R. 125, HL (Sc).

[51] [1970] VicRp 88; [1970] V.R. 683 at 689-690.

[52] [1952] A.C. 192 at 208.

[53] [1986] HCA 82; (1986) 161 C.L.R. 500 at 510-511, per Mason, Wilson, Brennan, Deane and Dawson, JJ.

[54] [1990] VicRp 74; [1990] V.R. 834 at 846.