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[2012] TASSC 53
General information, not legal advice.
Supreme Court of Tasmania
2012-08-10
Blow J
Original judgment source is linked above.
CITATION: Cook v Buckingham [2012] TASSC 53
Employment Law - Rights and liabilities as between employer and third parties - Liabilities of employer - For torts of employee - Acts in common employment and within scope of authority - Particular cases - Employee driving fellow employee to work - Employer providing vehicle, fuel and payment for travelling time.
Comino v Lynch [1959] QWN 49; Joss v Snowball (1969) 72 SR(NSW) 218; Commonwealth v Cocks [1966] HCA 27; (1966) 115 CLR 413; Greenwood v Commonwealth of Australia [1975] VicRp 84; [1975] VR 859; Vandyke v Fender [1970] 2 QB 292; Nottingham v Aldridge [1971] 2 QB 739, considered.
Workers Compensation - Entitlement to compensation - Employment related injury, disability or disease - Scope of employment - Acts incidental to contract of employment - Injuries sustained in streets or public places - Journeying on public road - Employer providing vehicle and paying for part of travelling time between residence and work site - Whether injury arose out of and in course of employment.
Henderson v Commissioner of Railways (Western Australia) [1937] HCA 67; (1937) 58 CLR 281; Humphrey Earl Ltd v Speechley [1951] HCA 75; (1951) 84 CLR 126; Hockey v Yelland [1984] HCA 72; (1984) 157 CLR 124; Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473, referred to.
Workers Compensation - Alternative rights against employer and/or third parties and consequences thereof - Rights of and against third parties - Right of employer to indemnity or contribution from third party - By person "by whom compensation is paid or payable" - Injury for which compensation is payable - Employer not liable to pay compensation but deemed to have accepted liability after not disputing claim.
Plaintiff Gradco Pty Ltd (46/2011): P L Jackson
Plaintiff Gradco Pty Ltd (46/2011): Wallace Wilkinson & Webster
Defendant (both actions): Temple Smith Partners
Third Party MAIB (both actions): McLean McKenzie & Topfer
Third Party QBE (46/2011): Wallace Wilkinson & Webster
Judgment Number: [2012] TASSC 53
RUSSELL DAVID COOK v RONALD FREDERICK BUCKINGHAM
MOTOR ACCIDENTS INSURANCE BOARD (Third Parties)
1 On a Monday morning in September 2008 Russell Cook was injured in a motor vehicle accident on his way to work. He lived at Lower Barrington, but was working at Rosebery, over 120Km from his home. He drove his own car to Sheffield, left it there, and was picked up by another man who worked for the same employer, Ronald Buckingham ("the driver"). About 8Km north of Tullah, the driver negligently ran off the road, and Mr Cook was injured. Mr Cook has sued for damages in respect of his injuries. Ordinarily, in such a situation, the Motor Accidents Insurance Board ("the MAIB") is liable to indemnify the negligent driver in respect of any liability for damages pursuant to the Motor Accidents (Liabilities and Compensation) Act 1973 ("the MALC Act"), s14(1). However the MAIB contends that, in the circumstances of this case, it has no liability, and that certain provisions in the Workers Rehabilitation and Compensation Act 1988 ("the WRC Act") apply to the damages claim. This dispute has arisen because, at the time of the accident, Mr Cook and the driver were both being paid by the hour by their employer, Gradco Pty Ltd, and because the MAIB contends that, at the time of the accident, the driver was acting in the course of his employment, driving Mr Cook to work in one of the employer's vehicles.
2 Two actions have been commenced in this Court. The first is Mr Cook's action for damages. He has sued the driver in respect of his injuries, and the driver has taken third party proceedings against the MAIB, claiming an indemnity in respect of his liability for damages, if any. He has also pleaded a defence under the WRC Act, in case it applies.
3 The second action has been commenced by the employer. Shortly after the accident, Mr Cook claimed workers compensation from the employer in relation to his injuries. Initially the employer made some payments. Subsequently the employer and its workers compensation insurer, QBE Insurance (Australia) Ltd ("the insurer"), took the view that they should not be paying Mr Cook workers compensation because his injuries were not connected with his employment in any way that entitled him to such compensation. The employer has sued the driver seeking reimbursement of the money that it paid out by way of workers compensation. In that second action, the driver has taken third party proceedings seeking an indemnity from either the MAIB or the insurer, whichever is appropriate.
4 The Associate Judge has ordered that the two actions be heard together, and that the issues as to liability be tried before the assessment of damages. I conducted a trial of the issues as to liability on 26 and 27 March 2012.
Mr Cook's action ** - the s138AB defence**
5 In Mr Cook's action for damages, the driver has conceded that he was driving the vehicle in which Mr Cook was travelling as a passenger; that the accident was caused by his negligent driving; and that, as a consequence of the accident, Mr Cook was injured and suffered damage. That is to say, he has conceded all of the ingredients of a common law cause of action for damages for negligence in respect of Mr Cook's injuries. However he has prudently pleaded a defence based on the WRC Act, s138AB(1).
6 At the relevant time, s138AB(1) and (2) read as follows:
"(1) Before commencing proceedings in court for an award of damages, a worker who intends to seek damages against an employer must lodge with the Tribunal an election to claim damages.
(2) A worker is not to make an election unless the degree of his or her permanent impairment is agreed by the worker and the employer, or determined by the Tribunal, to be a percentage of the whole person of not less than 30%."
9 Mr Cook has not lodged an election with the Workers Rehabilitation and Compensation Tribunal pursuant to s138AB(1). It is not likely that the degree of his permanent impairment would be agreed or determined to be an impairment of the whole person of 30% or more for the purposes of s138AB(2). Because he has not lodged a s138AB(1) election, his action must fail if that subsection applies. But it must succeed if that subsection does not apply.
10 In order to determine whether or not that subsection applies, it is necessary to have regard to s138AA, the relevant provisions in which read as follows:
"(1) This Division applies to the awarding of damages against an employer independently of this Act in respect of an injury suffered by a worker if -
(a) the injury was caused by the negligence or other tort of, or a breach of contract or statutory duty by, an employer; and
(b) compensation has been paid or is payable in respect of the injury under this Act or would have been paid or be payable but for section 25(2).
(3) A reference in this Division to an employer includes a reference to a person for whose acts an employer is vicariously liable."
11 There is no suggestion that the employer was itself negligent. Mr Cook's injuries were caused by the negligence of the driver. Mr Cook contends that, at the time of the accident, the driver was not driving in the course of his employment; that the employer is therefore not vicariously liable for the driver's negligence; that the driver's negligence therefore does not constitute negligence on the part of an employer for the purposes of s138AA(1)(a); and that the provisions of s138AB therefore do not apply to his claim for damages. The MAIB contends that the driver was driving in the course of his employment; that the driver was therefore a person for whose acts the employer is vicariously liable; that the negligence of the driver was therefore the negligence of an employer for the purposes of s138AA(1)(a); and that s138AB therefore does apply. The driver's amended defence also raises those contentions. The critical question is whether he was driving in the course of his employment.
12 The driver was employed as a "Civil 3". He operated an excavator His contract of employment contained an express term to the effect that the terms and conditions of his employment were regulated by an Australian workplace agreement known as the Gradco Pty Ltd Employee Collective Agreement Field Operators 2008 - 2010 ("the AWA").
"(i) No allowance shall be payable for travel within home radial area.
(ii) For travel outside the radial area, an employee shall be compensated for time from the edge of the radial area to the job, twice per day, payable at ordinary rate of pay, to the nearest 15 minutes."
14 Mr Cook was also employed as a "Civil 3". He operated a dump truck. I infer that his contract of employment also contained an express term to the effect that the terms and conditions of his employment were regulated by the AWA.
15 The driver lived at Winkleigh, which is a few kilometres west of Exeter, and nearly 30Km north of Westbury. He was provided with a copy of the AWA and a map showing his 30Km "radial area". That is to say, a circle was drawn on the map with Winkleigh at its centre and a radius of 30Km. The result was that, when the driver drove from Winkleigh to Rosebery, he was not entitled to payment for his travelling time within the circle, but he was entitled to $18.95 per hour once he was outside the circle. On the day in question, he was entitled to payment at that rate for the whole of the time that Mr Cook was in the vehicle.
16 Evidence was given by Mr Cook and the driver as to their working and travelling arrangements. It is clear from their evidence, which was uncontroversial, that the facts were as follows:
17 The reasons for the common law rule that an employer is vicariously liable for the torts committed by an employee in the course of that person's employment were explained by Isaacs J (as he then was) in Bugge v Brown [1919] HCA 5; (1919) 26 CLR 110 at 117 - 118 as follows:
"The rule of law ... is that the master is responsible, provided the servant is acting in 'the course of his employment.' That phrase and various corresponding phrases, such as 'scope of employment' and other similar phrases, are used to indicate the just limits of a master's responsibility for the wrongdoing of his servant. We have seen that the narrow view of 'limits of authority' whether actual or implied, or even where a definite prohibition against doing the act complained of exists, or where even the law itself forbids the act, does not determine the question of liability to answer for the wrong; for the act complained of may nevertheless be within the course of the employment. But the law recognizes that it is equally unjust to make the master responsible for every act which the servant chooses to do. The limit of the rule - expressed in the widest form by the phrase 'the course of the employment' or 'the sphere of the employment' - is when the servant so acts as to be in effect a stranger in relation to his employer with respect to the act he has committed, so that the act is in law the unauthorized act of a stranger. This is the root of the matter.
The cases to which I have just referred recognize and act on the principle stated, but the principle itself is laid down in very distinct language by Parke B, when delivering the judgment of the Court in Quarman v Burnett [(1840) [1840] EngR 182; 151 ER 509 at 513 - 514; [1840] EngR 182; 6 M & W 499 at 509]. That learned Judge says: - 'Upon the principle that qui facit per alium facit per se, the master is responsible for the acts of his servant; and that person is undoubtedly liable, who stood in the relation of master to the wrongdoer - he who had selected him as his servant, from the knowledge of or belief in his skill and care, and who could remove him for misconduct, and whose orders he was bound to receive and obey ... But the liability, by virtue of the principle of relation of master and servant, must cease where the relation itself ceases to exist.' I need scarcely add, how it ceases to exist is not material." [Original emphasis. Most case references have been omitted.]
18 The question of whether an employee was acting within the scope of his or her employment for the purposes of vicarious liability at common law is a question of fact: Bugge v Brown (above) at 121; United Africa Co Ltd v Saka Owoade [1955] AC 130 at 144; Rambarran v Gurrucharran [1970] 1 All ER 749 at 754; Greenwood v Commonwealth of Australia [1975] VicRp 84; [1975] VR 859.
19 The learned authors of Fleming's Law of Torts, 10th ed, 2011, say at 450:
"'The course of employment' is an expansive concept which provides ample scope for policy decisions and, despite the vast volume of case law, has failed to acquire a high degree of precision. No statistical measurement is possible, and precedents are helpful only when they present a suggestive uniformity on parallel facts."
20 There are a number of reported decisions of Australian courts concerning questions as to the vicarious liability of employers involving facts with similarities to those of this case, but there seem to be none on parallel facts.
21 In Comino v Lynch [1959] QWN 49, a question arose as to whether a company was vicariously liable for the negligent driving of a man employed by it as a travelling salesman. He was permitted to take his employer's car home after the working day was over, thus saving his employer from providing a garage for the car at night and enabling him to start his rounds each morning from his home. A collision occurred one night when he had finished the day's work, had dined at a club, and was driving home. Philp J held that the employee was driving the car for joint purposes of himself and his employer, and that his employer was therefore vicariously liable for his negligence. That case is arguably distinguishable from the present case on the basis that it concerned a salesman who was employed to drive and did not have a stereotypical place of work, whereas in this case, at least arguably, the driver was not employed to drive, and had a stereotypical place of work, namely the Bobadil Dam site.
22 In Joss v Snowball (1969) 72 SR(NSW) 218, the respondent had been driving his employer's car from his home in Albury, intending to keep a business appointment in Melbourne, and then to travel to Mornington with a senior officer of the employer company on that company's business. He was carrying his wife's cousin as a passenger with his employer's permission. Before reaching Melbourne he was involved in an accident and the passenger was injured. The passenger sued both the employee and the employer, and obtained a verdict against both. The New South Wales Court of Appeal held, by majority (Jacobs and Holmes JJA, Wallace P dissenting), that the employer was not vicariously liable, on the basis that the employee did not have "ostensible authority in the course of his employment, as distinct from a mere permission concurrently with his employment, to give lifts": per Jacobs and Holmes JJA at 224. That case is authority for the proposition that, when an employer's vehicle is being driven by an employee whose negligent driving results in a passenger being injured, the employer will be vicariously liable only if both the driving and the carrying of the passenger were within the course of the employee's employment.
23 All members of the court in that case took the view that the employee was driving in the course of his employment: Wallace P at 222; Jacobs and Holmes JJA at 223. The employee had been transferred to Melbourne, and was required by the employer to take up residence in Melbourne, but was permitted to travel back to his home in Albury in the employer's vehicle for weekends pending the sale of his Albury property. He was returning to Melbourne on a Monday morning to resume his duties when the accident occurred. That case is arguably distinguishable on its facts from the present case in that it concerned an employee who was employed to travel in his employer's vehicle - as a field representative in the Gippsland district - whereas the driver in this case was employed not to drive, but to operate an excavator.
24 In Commonwealth v Cocks [1966] HCA 27; (1966) 115 CLR 413, the respondent was a Commonwealth public servant who had been transferred from Canberra to Melbourne, and was driving from Canberra to Melbourne on a weekend with his wife for the purpose of taking up his new duties, when he negligently collided with the side of a bridge. His wife was injured. She sued for damages in the original jurisdiction of the High Court. Owen J held that the Commonwealth was vicariously liable: Cocks v Commonwealth (1965) 39 ALJR 47. On appeal, Barwick CJ, McTiernan and Taylor JJ held that the Commonwealth was not vicariously liable because the employee was not using or driving his vehicle on behalf of the Commonwealth. There was evidence that a transferred officer or employee was ordinarily entitled to the payment of fares for himself and his family, and that on this occasion permission had been given for the officer to make the trip by car, with the Commonwealth paying him both a mileage rate and a travelling allowance. That case is arguably distinguishable from the present case on the basis that it was not to the Commonwealth's advantage for the passenger in that case to be brought to Melbourne, whereas it was to the employer's advantage for Mr Cook to be brought to Rosebery.
25 Greenwood v Commonwealth of Australia (above) concerned two naval ratings who were transferred from a ship berthed in Sydney to a ship berthed in Melbourne. Approval was given for one of them, a man named Watson, to make the journey driving his own car, and for the other to travel as his passenger. The passenger was injured as a result of Watson's negligent driving. A jury held that the Commonwealth was vicariously liable for his negligence. On appeal to the Full Court of the Supreme Court of Victoria it was held by majority (Gillard and Crockett JJ, Lush J dissenting) that there was sufficient evidence to justify the finding of vicarious liability. At 862 Gillard J said:
"... it was open to the jury to infer that the Commonwealth had engaged Watson, who was continuously on duty throughout the journey, to transport himself and the plaintiff, who also was on duty, from Sydney to Melbourne."
"At all relevant times Watson was a servant of the Commonwealth. During the journey itself he was 'on duty'. That is he was 'working' for his employer. It was not just his duty to sail in and work on ships but also to get from ship to ship. That is it was one of the incidents of his employment that he was required on occasion to move from one ship to another."
That case is arguably distinguishable from the present case on the basis that Mr Cook and the driver, although being paid for some of their travelling time, were not on duty until they reported for duty at their employer's job site.
26 There have been a number of High Court cases as to the meaning of the expression "course of employment" in workers compensation legislation. It should be noted that those cases were concerned with beneficial legislation, and not with vicarious liability at common law. In Henderson v Commissioner of Railways (Western Australia) [1937] HCA 67; (1937) 58 CLR 281, a railway worker had been killed by a train during his lunch hour when crossing the railway on his way to a camp used by him and his gang. It was held that his death had occurred in the course of his employment. At 294, Dixon J said:
"The general principle governing the ascertainment of the 'course of employment' appears now to be settled. It is not merely a question of the existence and continuance of a relationship. To be in the course of the employment, the acts of the workman must be part of his service to the employer. But the difficulty lies in the application of this conception. For the service consists in more than the actual performance of the work which the workman is employed to do. It includes the doing of whatever is incidental to the performance of the work. General expressions of this kind have not proved very helpful. ... Where the accident arises shortly before the beginning of actual work or shortly after its cessation, or in an interval when labour is suspended, and it occurs at or near the scene of operations, the question whether it arises in the course of the employment will depend on the nature and terms of the employment, on the circumstances in which work is done and on what, as a result, the workman is reasonably required, expected or authorized to do in order to carry out his actual duties. That the workman is liable to the control of the employer is of some importance. That he has not yet assumed the same relation to his employer's premises and work as an ordinary member of the public is another matter of weight ...".
27 In Humphrey Earl Ltd v Speechley [1951] HCA 75; (1951) 84 CLR 126, a mechanic who was employed to travel around the Sydney metropolitan area to service and repair machines, travelled from Collaroy to Dee Why to get some hot fish for lunch, and was injured on his way back to Collaroy. It was held that the injury was not sustained in the course of his employment. At 133, Dixon J, with whose reasons Williams, Webb and Fullagar JJ agreed, repeated, without any significant variation, all but the last two sentences in the passage that I have quoted above from Henderson.
28 In Hatzimanolis v ANI Corporation Ltd [1992] HCA 21; (1992) 173 CLR 473, a man working in a remote place in Western Australia was injured on a day off during an excursion organised by his employer. The High Court held that the injury was sustained in the course of employment. However Mason CJ, Deane, Dawson and McHugh JJ said, at 483:
"The course of employment is ordinarily perceived as commencing when the employee starts work in accordance with his or her ordinary or overtime hours of work and as ending when the employee completes his or her ordinary or overtime hours of work."
29 There are some English journey injury cases that are a little more helpful than the Australian cases. In St Helens Colliery Co Ltd v Hewitson [1924] AC 59, a worker employed by a colliery company was injured in a railway accident while travelling in a special colliers' train, arranged by his employer, from the colliery to his home. The House of Lords held, by majority, that, because the worker was not obliged to use the train, his injury did not arise in the course of his employment for the purposes of a workers compensation statute. In a number of cases the House of Lords drew a distinction between departing from an employer's premises at the end of a working day, which was regarded as being in the course of a worker's employment, even when the worker traversed other premises with a different owner in order to leave, and travelling by choice along a public highway, or on a railway company's land, which was not regarded as being in the course of employment: Newton v Guest, Kean & Nettlefolds, Limited (1926) 19 BWCC 119; Northumbrian Shipping Co, Limited v McCullum (1932) 48 TLR 568 per Lord Macmillan at 572; Weaver v Tredegar Iron and Coal Co Limited [1940] AC 955.
30 In Vandyke v Fender [1970] 2 QB 292, the plaintiff and the defendant both worked for an employer who provided them with a car for transport to and from their homes, and paid for the petrol. The plaintiff in that case was injured when travelling to work in the car as a result of the negligent driving of the defendant. The English Court of Appeal held that, for the purposes of an insurance policy, the plaintiff was not injured "in the course of his employment". At 305, Lord Denning MR, with whom the other members of the court agreed, after referring to some of the earlier House of Lords cases, said the following:
"They show, to my mind quite conclusively, that when a man is going to or coming from work, along a public road, as a passenger in a vehicle provided by his employer, he is not then in the course of his employment - unless he is obliged by the terms of his employment to travel in that vehicle. It is not enough that he should have the right to travel in the vehicle, or be permitted to travel in it. He must have an obligation to travel in it. Else he is not in the course of his employment. That distinction must be maintained: for otherwise there would be no certainty in this branch of the law." [Original emphasis.]
31 The employees in that case were not paid for any of their travelling time. However, as Sachs LJ observed at 311, their employer supplied the car in lieu of paying them extra wages. That observation is consistent with the findings of the trial judge in that case, Paull J, as reported in Vandyke v Fender [1969] 2 QB 581 at 589. The employer in that case was obliged to make the car available, but the employees were not obliged to use it. At 312, Sachs LJ, with whom Karminski LJ agreed, commented, "A contract which gives rights to use travel facilities should not lightly be construed as one of employment."
32 In Nottingham v Aldridge [1971] 2 QB 739, the plaintiff and the first defendant were apprentices employed by the Post Office. The first defendant borrowed a vehicle, and was driving himself and the plaintiff to attend a residential training centre for the purposes of their employment, when an accident occurred, and the plaintiff was injured as a result of his negligence. The first defendant was entitled to a mileage allowance for travelling to the training centre in the borrowed vehicle, and to a passenger allowance of one penny per mile. Eveleigh J (as he then was) held that, because the first defendant had no contractual obligation to drive himself or the passenger to their destination, he was not driving in the course of his employment, and the Post Office was therefore not vicariously liable for his negligent driving.
33 I return to the facts of this case. I am not satisfied that the driver had a contractual obligation to transport himself or Mr Cook to Rosebery or to the Bobadil Dam site on the morning in question. Their only contractual obligations were to present themselves for work at the required places and times. They were free to choose their own routes, and means of transport, to and from job sites. Their remuneration for their travelling time was in the nature of an allowance, as distinct from payment for the work that they were engaged to perform. That is why they were only ever paid at the ordinary time rate for their paid travelling time, even after working at overtime rates on a Friday afternoon or evening. The driver was employed to operate an excavator, and not to be a chauffeur. It would be absurd if, on days when they travelled, their employment began or ended when they crossed an imaginary line representing the limit of a 30Km "radial area". It must follow that the driver was not acting in the course of his employment when Mr Cook was injured; that the employer was therefore not vicariously liable for his negligent driving for the purposes of s138AA(3); that his negligence therefore did not constitute negligence on the part of an employer for the purposes of s138AA(1)(a); that the provisions of s138AB therefore do not apply to Mr Cook's claim for damages; that the defence under that section pleaded by the driver must therefore fail; and that Mr Cook's action must therefore succeed.
34 Mr Cook is therefore entitled to judgment against the driver for damages to be assessed.
Mr Cook's action for damages ** - liability of the MAIB**
35 Mr Cook is entitled to damages at common law. The driver is liable for those damages as the user of a motor vehicle. As a general rule, the MAIB is bound to indemnify the user of a motor vehicle in respect of a liability to a plaintiff for damages for personal injuries pursuant to the MALC Act, s14(1), which reads as follows:
"(1) By virtue of this Act, but subject to and in accordance with the provisions thereof, the Board is bound to indemnify an owner or user of a motor vehicle, or his legal personal representatives, in respect of any liability (not being a contractual liability) incurred by him in respect of the personal injury to a person resulting directly from a motor accident involving that motor vehicle in this State on or after the appointed day."
36 However, at least generally speaking, that subsection does not apply in relation to injuries to which the WRC Act applies. That is because of s14(3) of the MALC Act, which begins as follows:
"(3) Subsection (1) does not apply to any liability in respect of which -
(a) a policy of insurance is required to be maintained under section 97 (1) of the Workers Rehabilitation and Compensation Act 1988 ...".
"(1) An employer who is not a self-insurer shall maintain in force with a licensed insurer a policy of insurance -
(a) that indemnifies him in respect of the full amount of his liabilities to pay compensation under this Act;
(b) that indemnifies the employer in respect of any liability arising independently of this Act in respect of an injury suffered by a worker arising out of and in the course of the employment of that worker by the employer; and
(c) that indemnifies each person employed by him in respect of the liabilities incurred by that person in respect of any such injury as is referred to in paragraph (b)."
38 Counsel for the MAIB submitted that, within the meaning of s97(1)(b), Mr Cook's injuries arose out of and in the course of his employment by the employer.
39 In the light of the High Court authorities that I have referred to concerning the meaning of "course of employment" in workers compensation legislation, I think that Mr Cook's employment on the day in question had not begun at the time when he was injured. He was in exactly the same position as the driver. He had a contractual obligation to present himself for work on the Bobadil Dam site at a particular time. He had no obligation to travel in a particular vehicle or with a particular driver. Although he was paid for some of his travelling time, riding to work in a company vehicle was not something that he was employed to do. He was employed to operate a dump truck. Because of those facts, I find that his injuries were not suffered in the course of his employment.
40 I need to deal separately with the question of whether he suffered an injury "arising out of" his employment. The liability of an employer to pay workers compensation is created by the WRC Act, s25(1). By virtue of s25(1)(a), such a liability arises only when a worker suffers an injury "arising out of or in the course of his employment". In the past, some journey injuries were deemed by s25(5) to arise out of and in the course of a worker's employment. However the law was changed by the Workers Rehabilitation and Compensation Reform Act 1995, s24. As a result, ever since 1995, s25(6)(a) has provided as follows:
"(6) For the purposes of this section, an injury does not arise from a worker's employment if it occurs -
(a) while the worker is travelling in either direction between the worker's place of residence and the worker's place of employment, except where that journey occurred -
(i) at the request or direction of the employer; or
(ii) if the journey is work related, with the authority (expressed [sic]or implied) of the employer ...".
41 Having regard to the evidence as to the circumstances of Mr Cook's journey, I am satisfied that, for the purposes of s25(6), it occurred when he was travelling between his place of residence and his place of employment; that the journey did not occur at the request or direction of the employer; and that it was not work related. In order to be work related, the journey would need to serve some purpose other than getting a worker to his place of employment. This journey did not serve any additional purpose. Although the employer may have facilitated Mr Cook's transportation in its vehicle, there was certainly no direction that he travel by that means, nor even a request that he do so. He was left free to make his own decision about how to get to the Bobadil Dam site on the morning in question.
42 Of course, s25(6) is a provision that is expressed to apply only for the purposes of s25, whereas the MAIB's liability depends on whether Mr Cook suffered an injury "arising out of" his employment for the purposes of s97(1)(b). However there is no reason why those words should be interpreted as having one meaning for the purposes of s25(1) and a different meaning for the purposes of s97(1)(b).
43 The ordinary meaning of "arising out of" was made clear in Hockey v Yelland [1984] HCA 72; (1984) 157 CLR 124. In that case a worker had suffered a subarachnoid haemorrhage while working as a labourer on a building site. A question arose as to whether that condition was one "arising out of or in the course of employment" for the purposes of a workers compensation statute. At 132 Gibson CJ, with whom Mason, Brennan and Dawson JJ agreed said:
"The meaning of the expression 'arising out of or in the course of employment' is well understood. The words 'out of' express causality, and require that the injury had its origin in the employment, but the words 'in the course of' require that the injury must occur 'whilst the worker is doing something which is part of his service to his employer or master or incidental to the employment, or, in other words, whether the workman was at the time of the injury about his own business or that of his master': South Maitland Railways Pty Ltd v James [1943] HCA 5; (1943) 67 CLR 496, at p502."
44 Mr Cook's injuries did not have their origin in his employment. It follows that, for the purposes of s97(1)(b), they did not arise out of his employment.
46 Section 97(3) of the WRC Act creates an exception in relation to journey injuries. That subsection reads as follows:
"(3) A policy of insurance which is required pursuant to subsection (1) to be maintained by an employer shall not be required to indemnify him or any person employed by him against any liability in respect of an injury suffered by a worker in an accident involving the use of a motor vehicle which occurs while the worker is travelling in either direction between his place of residence and his place of employment."
47 The MAIB also contended that, when Mr Cook was injured, he was not travelling "between his place of residence and his place of employment" for the purposes of s97(3). It contended that he had no fixed place of employment, and that his employment on the day in question had begun before the accident occurred.
48 If I am wrong about s97(1)(b), I think the indemnity claim must still succeed because of s97(3) of the WRC Act. In my view, on the day in question, the Bobadil Dam site was Mr Cook's place of employment. He was employed to work as a dump truck operator at job sites of the employer's choosing. It was at those job sites that he was required to work rostered hours pursuant to cl 2.1.1 of the AWA, including reasonable overtime if required under cl 4.1. That was why cl 6.3.3 of the AWA referred to "the job site", and cl 6.6.1 thereof referred to "the job location". There are some workers who do not routinely work at stereotypical workplaces, such as travelling insurance salespersons, road workers, and forest rangers: Oosterom v Australian Metropolitan Life Assurance Co Ltd [1960] VicRp 80; [1960] VR 507; Nichols v Attorney-General [1950] Tas SR 54; Wilkinson v Forestry Commission [1986] Tas R (NC 11), A47/1986. But Mr Cook did have a stereotypical workplace on each working day. He was injured in an accident involving the use of a motor vehicle while he was travelling from his place of residence at Lower Barrington to his place of employment at the Bobadil Dam site. That was an accident that fell within the scope of s97(3) of the WRC Act. The insurance policy that the employer was required to maintain pursuant to s97(1) was not required to indemnify it against any liability in respect of an injury suffered by Mr Cook in such an accident. The exception created by s14(3) of the MALC Act did not apply. It follows that, on that basis also, the driver is entitled to an indemnity from the MAIB pursuant to s14(1).
49 For these reasons, the driver is entitled, in relation to Mr Cook's action, to judgment against the MAIB for an indemnity in respect of his liability to Mr Cook.
The employer's action - liability under s134(1)
50 As I have said, Mr Cook claimed workers compensation from the employer in relation to his injuries, and the employer made some payments of compensation to him. The employer has brought an action against the driver seeking reimbursement of the compensation that it paid to Mr Cook. The employer claims to be entitled to recover an indemnity from the driver pursuant to the WRC Act, s134(1), which reads as follows:
"(1) Subject to this section, where an injury for which compensation is payable to a worker is caused under circumstances which, but for section 138AB, would create a liability in some person other than the employer to pay damages in respect of that injury to that worker, the employer may recover indemnity against that person in respect of the compensation paid by the employer to the worker in respect of that injury."
51 The driver contends that Mr Cook did not suffer "an injury for which compensation is payable" within the meaning of s134(1), for a number of reasons:
1"> 52 The employer conceded that compensation need not have been paid to Mr Cook by reason of s25(6)(a). However it argued that Mr Cook's injury became "an injury for which compensation is payable", for the purposes of s134(1), as a result of the operation of s81AB of the WRC Act.
53 The WRC Act contains a series of provisions that were introduced in order to overcome problems in relation to delays in the commencement of weekly payments to injured workers. As a general rule, an employer is required to commence making weekly payments of compensation to a worker following the receipt of a claim for compensation: s81. An employer who disputes liability to pay compensation must now, within 84 days of receiving a claim for compensation, serve the worker with written notice that it disputes liability, inform the worker of the reasons for disputing liability, and refer the matter to the Workers Rehabilitation and Compensation Tribunal: s81A(1). If the employer does not dispute liability to pay compensation under s81A, the employer "is taken to have accepted liability in respect of that claim": s81AB. The tribunal may then order the employer to make weekly payments of compensation in respect of the worker, and/or order the employer to pay medical or other expenses in respect of the injury: s81AC.
54 Although Mr Cook was not entitled to workers compensation, the employer did not dispute liability in accordance with s81A, and therefore "is taken to have accepted liability" in respect of Mr Cook's claim by virtue of s81AB. There is no evidence that the tribunal has been asked to make any order against the employer. The operation of s81AB does not preclude the employer from referring to the tribunal, pursuant to s88(1), the question of its liability to pay compensation. There is no evidence that that has been done. If it were done, the tribunal could make a determination which would bring to an end any deemed accepted liability based on s81AB, with effect from any date it determined: s88(3).
55 When Mr Cook was injured, his injury was not initially one for which compensation was payable, within the meaning of s134(1). The question I have to consider is whether, for the purposes of that section, it became "an injury for which compensation is payable" as a result of the employer not disputing liability, and s81AB consequently coming into operation.
56 Prior to 1973, there was no statutory provision in Tasmania that enabled an employer, after paying workers compensation to an employee, to recover an indemnity or contribution from a tortfeasor who had caused or contributed to the employee's injury. The Workers' Compensation (Alternative Remedies) Act 1973 introduced such a provision for the first time. The Workers' Compensation Act 1927 was amended by inserting s8H. That section enabled an employer to recover an indemnity "where an injury for which compensation is payable to a worker is caused under circumstances creating a liability in some person other than the employer to pay damages in respect thereof to that worker". The 1927 Act did not contain provisions equivalent to the current ss81A, 81AB and 81AC. When s8H of the 1927 Act referred to "an injury for which compensation is payable", those words referred only to the situation where a worker had a statutory entitlement to compensation independently of any failure to dispute liability.
57 The same words, "an injury for which compensation is payable" now appear in s134(1). I see no reason to hold that they have a wider meaning than they had in the repealed s8H.
58 When a worker suffers an injury arising out of, or in the course of, his or her employment, s25(1) says that the employer is "liable to pay compensation". Those words are not used in the WRC Act in relation to an obligation that arises as a result of an employer not disputing liability. As I have said, s81AB says that the employer "is taken to have accepted liability in respect of that claim". A distinction can be drawn between an employer who is "liable to pay compensation" pursuant to s25(1), and an employer who "is taken to have accepted liability" by virtue of s81AB. In the latter situation, it remains possible for the tribunal to determine that the employer is not liable to pay compensation. If the submissions made on behalf of the employer in this case are correct, one could have a situation where an injury is not initially one "for which compensation is payable" within the meaning of s134(1); where the injury falls into that category for a time as a result of the employer not disputing liability; and where the injury ceases to be within that category when the tribunal makes a determination favourable to the employer following a referral under s88. In my view that situation would be absurd.
59 Sometimes the compensation payable to an injured worker by way of weekly payments can exceed the amount recoverable by that worker in respect of the impairment of his or her earning capacity. Take, for example, a lazy individual who is capable of doing full-time remunerative work, but chooses not to fully exploit his or her earning capacity, and only to do a little casual work from time to time. If that individual were injured in the course of employment, and if an incapacity for work resulted, he or she would be entitled to compensation by way of weekly payments, possibly for years, even if he or she had never intended to do more than a few days' casual work. If that same individual were entitled to damages for negligence in respect of the same injury, the damages for the impairment of his or her earning capacity would be substantially discounted because of the likelihood that that earning capacity would only be exploited to a very small extent. The compensation would be greater than the damages. I mention that sort of situation because, if s134(1) were given the wide meaning contended for by the employer in this case, the result would be most unfair. If the employer was not liable to pay compensation under s25(1), but did not dispute liability to pay compensation, s134(1) would enable the employer to recover an indemnity in respect of the compensation paid to the worker, even though the amount paid far exceeded the amount that the worker could have recovered by way of damages from the tortfeasor.
60 Of course an entitlement to compensation can similarly far exceed an entitlement to damages in a case where the employer is liable to pay compensation under s25(1). But it is one thing to pass the burden of such a liability on to a tortfeasor, and a very different thing to pass on to a tortfeasor the burden of paying compensation that arises not because of a nexus between the injury and the injured worker's employment, but because of an employer not disputing liability. The failure to dispute liability could occur because of a mistake, an oversight, a commercial decision not to litigate in a borderline case, or deliberate generosity. In any of those situations, the existence of a right of indemnity would be unjust, and something foreign to the purpose or object of s134(1).
61 For these reasons, I think s134(1) should be interpreted as conferring a right of indemnity only in situations where compensation is payable to a worker pursuant to s25(1), and not in situations where an employer is obliged to pay compensation only because that employer is taken to have accepted liability pursuant to s81AB.
63 In action no 852 of 2009 (Mr Cook's action), I make the following orders:
1 That judgment be entered for the plaintiff against the defendant for damages to be assessed.
64 In action no 46 of 2011 (the employer's action), I order that judgment be entered for the defendant on the claim, and for the third parties in the third party proceedings.
Cook
Buckingham [2012] TASSC 53
(1966) 115 CLR 413
(1937) 58 CLR 281
(1951) 84 CLR 126
(1984) 157 CLR 124
(1992) 173 CLR 473
(1919) 26 CLR 110
(1965) 39 ALJR 47
(1943) 67 CLR 496