Chapman v Gibbo's Transport Pty Ltd

Procedural chronology

1. On 6 April 2020, the plaintiff commenced these proceedings in the District Court against the first defendant. The first defendant filed a defence on 17 April 2020. Subsequently, the plaintiff was granted leave to amend the statement of claim to add the second defendant as a party. He filed a first amended statement of claim, which made allegations against the second defendant, on 12 October 2020.
2. The second defendant filed a defence on 25 January 2021 but did not raise a defence under the Act. The second defendant also filed the first cross-claim against the first defendant. As the second defendant did not consent to extended jurisdiction by the District Court, the proceedings were transferred to this Court on 17 May 2021.
3. On 10 June 2021, the plaintiff filed a second amended statement of claim which corrected the name of the second defendant. On 30 November 2021, the second defendant notified the plaintiff of its proposal to amend its defence to raise ss 108 and 109 of the Act. On 16 December 2021, the first defendant filed the second cross-claim against the second defendant.
4. As referred to above, on 3 February 2022, the second defendant filed the present notice of motion seeking the following orders: "1 Leave for the Second Defendant to file an Amended Defence inserting the paragraphs found at Annexure "A" to this Motion. 2 A determination that the Plaintiff's claim against the Second Defendant is a claim which falls within Section 3A of the Motor Accidents Compensation Act 1999 (NSW) (MAC Act) and therefore one which must be pursued in accordance with the legislative scheme of the MAC Act. 3 An order that the Plaintiff's proceedings against the Second Defendant be dismissed given the Plaintiff's failure to obtain the requisite certificate under sections 92 or 94 of the MAC Act, thereby prohibiting him from commencing proceedings by application of Section 108 of the MAC Act; and/or 4 An order that the Plaintiff's proceedings against the Second Defendant be dismissed as leave of the Court was not obtained to commence proceedings on 12 October 2020 as required by Section 109 of the MAC Act by which time the 3 year limitation for the commencement of Court proceedings had expired by application of Section 109 of the MAC Act. 5 An order that the Plaintiff pay the Second Defendant's costs of and incidental to this application on an indemnity basis. 6 An order that the Plaintiff pay the Second Defendant's costs of and incidental to the proceedings. 7 Any other such orders that this Honourable Court deems fit." [Emphasis in original.]
5. The plaintiff's current pleading relevantly alleges as follows: "3. At all material times the Plaintiff was employed by the First Defendant as a truck driver. 4. The Plaintiff commenced his employment with the First Defendant in or around late April 2016. 5. As part of the Plaintiff's duties with the First Defendant he was required from in or around late April 2016 to drive a prime mover tanker to a location at Manildra. Known as Manildra Flour Mills, 1 Kiewa Street, Manildra NSW 2865 ("the flour mill"). 6. Whilst at the flour mill, the Plaintiff's tanker was filled by servants/agents/employees of the flour mill. 7. The Plaintiff was then required to drive the tanker, loaded with flour, from the flour mill to Sydney. 7A. On or about 1 August 2016, the First Defendant arranged with the Second Defendant for the Second Defendant to allocate one of their vehicles to the Plaintiff. for him to drive in the course of his employment with the Second Defendant. 7B. The Plaintiff was allocated and supplied with a tanker truck by the Second Defendant on 1 August 2016 being Registration Number BB10SG, (QUBE Logistics' vehicle number PM791). 8. On 1 August 2016 the Plaintiff attended the flour mill in truck B81 DSG- trailer 22023S ("the tanker'') at which time the tanker was filled with a load of flour. 9. Prior to the Plaintiff's employment with the First Defendant, he had not previously driven a tanker and/or a tanker containing flour. 10. Whilst driving the tanker on the return journey from Manildra to Sydney, the tanker rolled over whilst the Plaintiff was turning left at a T-intersection on the Corner Escort Way and North Distributor Road, Orange NSW. …. 14 The injury, loss and damage to the Plaintiff was caused by the negligence of the Defendants, particulars of which are as follows:- … vi. Failed to ensure that the Plaintiff was adequately instructed in relation to the loading of the tanker; vii. Failed to ensure that the tanker was loaded in such a manner so as to avoid risk of injury to the Plaintiff; viii. Failed to adequately instruct the Plaintiff as to the management and control of the vehicle following its loading, including instruction as to the Mass, Fatigue and Speed characteristics of driving a prime mover and tanker, or provide induction or competency training/assessment for knowledge and skills required to drive a bulk transport tanker on NSW roads; ix. Failed to ensure that the vehicle was safe for its intended use, and was capable of carrying the load without overturning, or implement sufficient risk control measures to protect the Plaintiff from rollover crash risks of injury by not providing available engineering controls; x. Failed to inspect check and adjust the inflation of tires so as to avoid the risk of the vehicle overturning with its load; …"
6. The particulars reproduced above are those which could relate to the second defendant. The particulars which relate to the first defendant, who was the plaintiff's employer, have not been reproduced.
7. By its proposed amended defence (which is annexure "A" to the notice of motion), the second defendant seeks to add the following paragraphs: "29 In further answer to the whole of the claim against the Second Defendant, the Plaintiff's claim for damages in these proceedings are not maintainable by reason of Section 108 of the Motor Accidents Compensation Act 1999 (NSW) (MAC Act). Particulars (a) The Plaintiff's claim against the Second Defendant is a 'claim' in respect of injuries allegedly caused by the fault of the owner of the motor vehicle referred to in paragraphs 7A to 10 of the Second Amended Statement of Claim, being the Second Defendant, in the use or operation of that vehicle and is thus a claim within the meaning of Section 3A of the MAC Act. (b) The proceedings should not have been commenced against the Second Defendant and are not maintainable by reason of Section 108 of the MAC Act, as the Plaintiff has not obtained certificates under Sections 92 or 94 of the MAC Act before commencing proceedings against the Second Defendant by the filing of the Amended Statement of Claim on 12 October 2020. 30 In further answer to the whole of the claim against the Second Defendant, the Plaintiff's claim for damages in these proceedings against the Second Defendant are not maintainable by reason of Section 109 of the MAC Act. Particulars (c) The proceedings should not have been commenced against the Second Defendant and are not maintainable by reason of Section 109 of the MAC Act, as the Plaintiff did not obtain leave of the Court pursuant to section 109 of MAC Act prior to commencing proceedings against Qube on 12 October 2020, even though more than 3 years had elapsed since the motor vehicle accident referred to in paragraphs 8 to 10 of the Second Amended Statement of Claim occurred on 1 August 2016."
8. At the hearing of the notice of motion, Mr Fitzsimmons SC sought leave to appear on behalf of QBE Insurance (Australia) Limited (QBE) on the basis that although QBE was not a party to the proceedings, it was affected by the relief sought by the second defendant. Leave, which was not opposed, was granted.
9. Mr Flett appeared on behalf of the first defendant at the hearing of the notice of motion, out of respect for the Court, but did not otherwise participate in the hearing.

Relevant statutory provisions

1. Section 3 of the Act relevantly defines "claim" as meaning "a claim for damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle." "Fault" is defined as "negligence or any other tort".
2. Section 3A(1) of the Act provides: "3A General restrictions on application of Act (1) This Act (including any third-party policy under this Act) applies only in respect of the death of or injury to a person that is caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle and only if the death or injury is a result of and is caused (whether or not as a result of a defect in the vehicle) during - (a) the driving of the vehicle, or (b) a collision, or action taken to avoid a collision, with the vehicle, or (c) the vehicle's running out of control, or (d) a dangerous situation caused by the driving of the vehicle, a collision or action taken to avoid a collision with the vehicle, or the vehicle's running out of control."
3. Section 79 relevantly provides: "Power of insurer to intervene in legal proceedings An insurer may apply to the court to be joined as a party to legal proceedings brought against a defendant who is insured under a third-party policy with the insurer in order to argue that in the circumstances of the case it has no obligation under the policy to indemnify the defendant."
4. Section 108 relevantly provides: "108 Claims assessment or exemption pre-condition for commencement of court proceedings (1) … claimant is not entitled to commence court proceedings against another person in respect of a claim unless - (a) a certificate has been issued in respect of the claim under section 92 (Claims exempt from assessment), or (b) a certificate has been issued in respect of the claim under section 94 (Assessment of claims). (2) The provisions of this section are in addition to those of section 109. Accordingly, both sections are capable of applying to a claim."
5. Section 108 operates as an absolute prohibition: Emad Trolley Pty Ltd v Shigar (2003) 57 NSWLR 636; [2003] NSWCA 231 (Emad Trolley) at [70] (McColl JA, Meagher and Hodgson JJA agreeing). As Leeming JA said in Millard v State Transit Authority [2013] NSWCA 321 at [6], s 108 "reflects a legislative policy that unless a motor vehicle claim is exempt it must first be assessed under CARS [Claims Assessment and Resolution Service, now PIC] before any court proceedings are commenced."
6. Section 109 imposes a time limitation on a "claimant" commencing proceedings more than 3 years after the accident to which the claim relates but provides for the Court to grant leave for an extension of time in certain circumstances, including if a full and satisfactory explanation for the delay has been given.

Consideration

1. Mr Parker SC, who appeared for the second defendant, contended that the plaintiff's claim was a "claim" within s 3 of the Act and that s 3A applied. He submitted that the only appropriate course was for this Court to dismiss the plaintiff's proceedings against the second defendant since s 108 had not been complied with. He relied on Emad Trolley in which the Court of Appeal held that a plaintiff could not, by pleading a claim in a particular way, avoid the operation of the Act.
2. Mr de Meyrick, who appeared for the plaintiff, submitted that the plaintiff's claim against the second defendant did not fall within the definition of "claim" in s 3 or the purview of s 3A because it depended on allegations against the second defendant other than those arising from negligence in the operation of the vehicle, but rather from negligence in failing to give the plaintiff adequate instruction on how to handle the vehicle.
3. However, he informed me that the plaintiff had, since the notice of motion was foreshadowed, submitted a claim under the Act to QBE. QBE had denied liability on the bases that the plaintiff had not given a full and satisfactory explanation for the delay in making the claim and that the second defendant was not at fault. He submitted that it could be expected that the plaintiff would be granted a certificate of exemption pursuant to s 92 of the Act.
4. Ultimately, Mr de Meyrick submitted that the appropriate course was to make an order in terms of paragraph 1 of the notice of motion, granting leave to the second defendant to amend its defence to raise non-compliance with ss 108 and 109, but to stand over the balance of the notice of motion until the plaintiff had complied with s 108.
5. Mr Fitzsimmons accepted that the course for which Mr de Meyrick contended was an appropriate one. He submitted that, once the plaintiff had obtained a certificate under s 92 or s 94 of the Act, it could be expected that the plaintiff would plead, in the alternative, that the provisions of the Act applied (his primary case being that they did not). In that event, he submitted that it would be necessary for the plaintiff to apply to join QBE as a defendant to the proceedings since it would be liable for any negligence on the part of the second defendant which was covered by the Act: that is, for fault by the second defendant as owner of the vehicle in the use or operation of the vehicle caused while it was being driven by the plaintiff.
6. In reply, Mr Parker submitted that the plaintiff would suffer no prejudice by the dismissal of his claim against the second defendant because, once he complied with s 108, he could move to add the second defendant as a party. He also submitted that QBE, as the compulsory third party insurer of the second defendant, ought conduct the defence on behalf of the second defendant, even if only some of the particulars of negligence fell within the Act.
7. There are cases where the allegations of negligence against a defendant who is either the owner or driver of a motor vehicle fall squarely within s 3A of the Act. In such cases, it is appropriate to dismiss a claim if s 108 has not been complied with: see, for example, Millard v State Transit Authority and Emad Trolley.
8. However, in other cases, the position is not as clear. Section 3A requires that the injury must be caused by the fault of the owner or driver of a motor vehicle in the use or operation of the motor vehicle. There is a further causal and temporal requirement in s 3A: that the injury is a result of and is caused during, relevantly, the driving of the vehicle or the vehicle's running out of control.
9. In the present case, the second defendant made available to the first defendant a vehicle which it owned so that it could be driven by the plaintiff. It is arguable that the plaintiff's injuries were caused by the fault of the owner of a motor vehicle (the second defendant) in the use or operation of the motor vehicle and that his injuries are a result of and were caused during his driving of the vehicle. However, it is also arguable that any negligence on the part of the second defendant falls outside those parameters and therefore is not covered by the Act.
10. Ultimately, this is an issue to be tried, as is illustrated by Nominal Defendant v GLG Australia Pty Ltd (2006) 228 CLR 529; [2006] HCA 11 (GLG). In GLG, the injured worker was employed under a labour hire arrangement with GLG. He was unloading boxes stored inside a container at GLG's premises. One of GLG's employees drove the forklift up and down a ramp connected to the container, which caused boxes stacked inside the container to fall and hit the worker. Although GLG was found to be at fault, its fault was not in the use or operation of the forklift as the driver was not driving in a negligent manner, but rather in the design and implementation of a system of work. Thus, the worker's claim did not fall within the Motor Accidents Act 1995 (NSW).
11. A similar question arose in Adlawan v Recochem Inc [2021] NSWSC 223; (2021) 95 MVR 304. In that case, Cavanagh J found in the final judgment, at [168], that "[t]he fault was the failure to instruct the plaintiff not to park on the sloping driveway or permitting him to do so in circumstances in which its written system of work warned against such a practice." His Honour concluded at [187]: "Whether the fault be described as permitting the parking of the forklift on the slope (when its devised system of work warned against it) or simply failing to specifically instruct the Plaintiff not to park on the sloping driveway whilst unloading the truck, the fault was in the actual use of the forklift at the time. That is, there was a failure to instruct the plaintiff in the use of the forklift (that is how and where it should be operated). The fact such a fault might have a dual characterisation does not preclude the satisfaction of S 3A and S 122."
12. On that basis, his Honour found that the plaintiff was entitled to damages under the Act.
13. In circumstances where the characterisation of the alleged fault is unclear and may depend on contested evidence, it would not be appropriate to determine this matter on a notice of motion. Ultimately, it would appear to be a matter for the final hearing. It is, accordingly, premature to determine whether s 3A applies and, accordingly, whether the plaintiff is in breach of the prohibition in s 108. This is particularly so in circumstances where, although the plaintiff maintained his contention that the Act did not apply, he has nonetheless submitted a claim under the Act, against the possibility that it may subsequently be held that it does apply.
14. I can see little point in adjourning the second defendant's notice of motion. It would not be appropriate to dismiss the plaintiff's claim against the second defendant before trial since aspects of the claim may fall outside the Act and are therefore not covered by the prohibitions in ss 108 or 109. For the reasons given above, the trial is the appropriate time to determine such questions in a case, such as the present, where it is not presently clear whether s 3A applies to some, all, or none of the particulars of negligence. This issue is likely to turn on contested evidence and involves a judgment which can only be made in light of all of the evidence, as in Adlawan v Recochem Inc.

Conclusion

1. In these circumstances, I propose to make an order in terms of paragraph 1 of the second defendant's notice of motion and dismiss the balance of the notice of motion. It is also appropriate to stand the matter over for a period to enable the plaintiff's compliance with the Act to be regularised and for the plaintiff to provide an amended pleading to reflect an alternative case, based on the Act, if so advised.

Further conduct of the proceedings

1. When, and if, the plaintiff seeks to file an amended pleading alleging, in the alternative, that he has suffered injuries as a result of a motor vehicle accident in respect of which the Act applies, an order can be made that those aspects of his claim commence from the date on which a certificate under ss 92 or 94 is issued, or from the date on which QBE is joined as a party pursuant to s 79. Such an order would accommodate the prohibition in s 108.

Orders and directions

1. For the reasons set out above, I make the following orders and directions: 1. Grant leave to the second defendant to file an amended defence which adds the paragraphs in annexure "A" to its notice of motion filed on 3 February 2022. 2. Otherwise dismiss the second defendant's notice of motion filed on 3 February 2022. 3. Reserve the costs of the motion, including the costs of the hearing on 31 May 2022. 4. Stand the matter over for further directions before me at 9.15am on Wednesday, 24 August 2022.

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