David William Sneil v Neil Owen Cockram & Workcover Queensland

CATCHWORDS: s155 Workers Compensation Act 1987 (NSW)

Workers Compensation & Rehabilitation Act 2003 (Qld) LEGISLATION CITED: Corporations Act 2001 Workers Compensation Act 1987 (NSW)

Francis v Emijay [2006] QCA 62 Burrows v The Workers' Compensation Board of Queensland [1997] QCA 182 CASES CITED: Stanley v Gallagher [2002] NSWCA 174 Mynott & Ors v Barnard (1939) 62 CLR 68 Commissioner for Railways for the State of Queensland v Peters (1991) 34 NSWLR 407 Ballantyne v Workcover Authority of NSW [2007] NSWCA 239

David William Sneil (Plaintiff) PARTIES: Neil Owen Cockram (First Defendant) Workcover Queensland (Second Defendant)

COUNSEL: David Hooke - Defendant/Cross Claimant Holyoak - Second Cross Defendant

1 HIS HONOUR: Black DCJ has ordered a question arising out of this litigation to be tried separately, and the question which is to be tried separately is:

"Do the provisions of the Workers Compensation & Rehabilitation Act 2003 (Queensland) require the second cross-defendant to indemnify the first cross-defendant in respect of the claims brought against it by the cross-claimant in these proceedings?".

2 The litigation in question involves two truck drivers who were hired by a Queensland company, TDS Agencies Pty Limited, hereinafter referred to as TDS, and they were hired to drive a truck from Queensland to Victoria.

3 In the course of doing so, there was an accident at a time when the defendant Cockram was driving the vehicle. At 7am on 9 December 2003, the semi trailer left the roadway and collided with a tree. As a result, the plaintiff was injured.

4 The defendant Cockram has lodged a cross-claim against TDS, which at the time had a policy of accident insurance issued by WorkCover Queensland. The agreed statement of facts says the term "accident insurance" is defined in s 8 of the 2003 Act as follows:

"8. Accident insurance is insurance by which an employer is indemnified against all amounts for which the employer may become legally liable for injuries sustained by a worker employed by the employer for: (a) compensation, and (b) damages."

5 The agreed statement of facts states that: "The plaintiff and Cockram were residents in Queensland at all material times. The registered office and principal place of business of TDS was at all material times at Brisbane in the State of Queensland. TDS was based at Brisbane in the State of Queensland. The contract of employment between the plaintiff and TDS was made in Queensland. The plaintiff commenced employment with TDS on 24 November 2003. The contract of employment between Cockram and TDS was made in Queensland. On 9 December 2003 and at all material times, TDS carried on business as a trucking company and carried freight within Queensland and from Queensland to Victoria. As at 9 December 2003, the plaintiff and the defendant each held heavy vehicle driver's licenses issued by the Queensland Department of Transport. On 9 December 2003, the plaintiff and the defendant were making a delivery of freight in a semi trailer from the TDS premises in Brisbane, to premises at Melbourne in Victoria, before delivering another load back to Brisbane. In order to deliver the freight to the premises in Melbourne, it was necessary for the plaintiff and Cockram to pass through the State of New South Wales. During the trip, the plaintiff and Cockram shared the driving as a two-up team. (The accident occurred as I have described.) The plaintiff was injured in the accident. The plaintiff and Cockram were each in the course of their employment with TDS at the time of the accident.

6 In the period between 24 November 2003 and including 9 December 2003, the plaintiff passed through New South Wales on nine occasions, including the journey during which the accident occurred in the course of his employment with TDS as an interstate truck driver as follows:- 24 November 2003 Brisbane to Melbourne. 25 November 2003 Melbourne to Brisbane. 28 November 2003 Brisbane to Melbourne. 29 November 2003 Melbourne to Brisbane. 1 December 2007(as said) Brisbane to Melbourne. 2 December 2003 Melbourne to Brisbane. 5 December 2003 Brisbane to Melbourne. 6 December 2003 Melbourne to Brisbane. 8 December 2003 Brisbane to West Wyalong en route to Melbourne.

7 The plaintiff was paid by TDS for the trip. TDS held a policy of accident insurance within the meaning of that expression, as it is defined in s 8 of the Workers Compensation & Rehabilitation Act 2003 (Queensland), (the 2003 Act) as at 9 December 2003.The second cross-defendant has made payments of workers compensation benefits (not damages) to, for and on behalf of the plaintiff in respect of the injuries he sustained in the accident, pursuant to the 2003 Act, which presently total approximately $210,000 and such payments continue. TDS is in liquidation, but leave to commence and maintain proceedings for contribution or indemnity has been made by Cockram the defendant under s 471B of the Corporations Act 2001."

8 I think I might stop there and resume this ex tempore at 2 o'clock.

9 The question for determination is whether or not WorkCover Queensland, which is the second cross-defendant, is required to indemnify TDS, the first cross-defendant in respect of the cross-claim against it involving the entitlement of the plaintiff to damages. Section 10(1) of the Queensland Act says:

"Damages is damages for injuries sustained by a worker in circumstances creating independently of this Act, a legal liability in the worker's employer to pay damages to: (a) the worker, or (b) if the injury results in the worker's death, a dependant of the deceased worker.

(2) A reference in subs 1 to the liability of an employer does not include a liability against which the employer is required to provide under: (a) another Act, or (b) a law of another State, the Commonwealth or of another country".

10 WorkCover Queensland, the second cross-defendant, argues that it is not liable because the damages the subject of the cross-claim are not damages within the meaning of s 10 of the Queensland Act because TDS was required by s 155(1) of the Workers Compensation Act, 1987 (NSW) (the Workers Compensation Act) to effect insurance under that Act in respect of the same risk, and I refer to s 10(2)(b) of the Queensland Act.

11 A primary submission of the defendant cross-claimant is that the many authorities in New South Wales dealing with the Workers Compensation Act and the question of its relevance to non New South Wales workers injured, are all cases in which what was at issue were the beneficial provisions of the New South Wales Act. The defendant cross claimant draws a distinction between s 13 of the Workers Compensation Act, which provides for compensation to injured workers, and s 155 of the Workers Compensation Act, which provides an obligation on employers to provide insurance in respect of injuries to workers.

12 The broad argument is that s 155 casts an obligation on employers and is quite different to s 13, which grants benefits to workers. It is argued the authorities that have been referred to are not relevant in respect of the obligation of the employer to insure. It is certainly true in support of the defendant cross-claimant's assertion that none of the New South Wales authorities draw this distinction, and they generally speaking, simply refer to "the Act". It is also true that factually, those cases have generally involved injured workers seeking compensation by establishing some connection with the State of New South Wales.

13 There are however cases in Queensland which tend to contradict that assertion. In particular, the matter was examined to some extent in Queensland in the case of Francis v Emijay, unreported appeal 7120/05 of 10 March 2006. There are three judgments, one of Williams J, one of Keane JA and one of McMurdo J. In the judgment of Keane JA at p 4 and at para (22), he said:

"The crucial issue is whether s 155(1) of the New South Wales Act obliged Emijay to insure against its liability in damages to Mr Francis. The learned primary judge followed the decision of this court in Burrows v The Workers Compensation Board of Queensland where Fitzgerald P, with whom McKenzie and Helman JJ agreed said that:

"Each of the respondent and his employer at the time when he was insured was a Queenslander and subs 155(1) plainly was not intended to apply if the respondent had been insured while working in Queensland, or for that matter Victoria."

14 In fact the injury had occurred in New South Wales. Fitzgerald P went on to hold that the then s 155 of the New South Wales Act was: "Not inapplicable merely because neither employer nor employees were resident nor domiciled, based or located, whichever he thought most apposite in New South Wales when an employee is injured. And the subsection was applicable to the respondent's then employer in respect of the work related injury which the respondent suffered in New South Wales in the course of his employment, which was the subject of the present action."

15 At para 23, he said: "As a qualification to this general proposition however, Fitzgerald P raised the possibility that s 155(1) of the New South Wales Act might conceivably be inapplicable 'if an employee's presence in New South Wales when he or she is injured in the course of his or her employment is fortuitous, fleeting or sufficiently unusual'. In the present case the learned primary judge did not consider that Mr Francis' presence in New South Wales was fortuitous, fleeting or sufficiently unusual."

16 The judgment of Keane JA went on to say at para (32):

"Further, the appellant's submission is somewhat inconsistent with the decision of the New South Wales Court of Appeal in Stanley v Gallagher. In that case, the Court surveyed the authorities at length and concluded that, while there must be 'some relevant connection with New South Wales' in relation to a claim for compensation under the New South Wales Act, that connection need not be that the proper law of the contract of employment is the law of New South Wales".

17 He went on to note in para (35) that s 155(1) of the New South Wales Act created an offence and there may be some undesirable degree of uncertainty in its language. But he went on to conclude:

"Where the exigencies of a worker's employment mean that the worker will be in New South Wales in accordance with that employment, then the employer can be taken to know all he needs to know to meet its obligations under s 155(1) of the New South Wales Act."

18 The other judgments in the case are similar in dealing with the obligations of an employer under s 155 of the New South Wales Act, and also in adopting the formula of whether the connection with New South Wales was or was not "fortuitous, fleet or sufficiently unusual".

19 It appears to me then that the Court of Appeal in Queensland is firmly against the proposition being put by the defendant cross-claimant in these proceedings. A general question is raised by the argument advanced by the defendant cross-claimant, and that general argument is the question, why would the New South Wales legislature pass a piece of legislation imposing on an employer, a lower obligation to insure employees, than the rights given to an employee to obtain compensation from the employer.

20 An argument advanced by the defendant cross-claimant is that if a gap is thus created, there is a means of filling it by way of the uninsured liability scheme. On the other hand, that is countered by the second cross-defendant who says that is a scheme which is there for the benefit of people who should have been insured, but were not.

21 At the end of the day, I cannot interpret the New South Wales statute as applying a different test between ss155 and 13. It would lead, in my view, to a very unusual result, and one that is clearly not in accord with the nature of the Act which was to provide benefits to injured workers and ensure that those benefits were obtained. Indeed, such an interpretation would be, in my view, contrary to the purposes of the Act.

22 The defendant cross-claimant argues that the test which should be applied in respect of s 155 is a test of where the contract of employment was made, and points to the penal provisions in s 155 of the Workers Compensation Act, which do indeed provide for criminal sanctions for non-compliance with the Act. The defendant cross-claimant argues that it would be against public policy to impose on businesses outside of New South Wales, an obligation enforced by a criminal sanction when firstly they might be less likely to know about the criminal sanction, and secondly where it would be very difficult to enforce the criminal sanction.

23 On the other hand, the fact is that there are many businesses which operate across borders within Australia and in my view, there is nothing contrary to public policy to require businesses which operate across borders to understand what the laws are in those areas where they do operate, and I do not believe that imposing such an obligation on interstate employers is a hardship.

24 Furthermore, the adoption by the defendant cross-claimant of the test of liability to the Act being dependent upon where the contract of employment was made, is one which has significantly been rejected in the authorities dealing with claims by workers for compensation.

25 An early rejection of that was in the judgment of Latham CJ in Mynott & Ors v Barnard (1939) 62 CLR at 68. There at p 77, he said:

"The mere fact that the contract of employment was made in Victoria is not satisfactory as a criterion of the applicability of the statute."

26 There have been a number of other statements to the same effect following that, including the case of Commissioner for Railways for the State of Queensland v Peters (1991) 34 NSWLR at 407. Where at p 424, Kirby P said:

"It was sufficient that there should be demonstrated a relevant connection between persons or circumstances beyond the Territory or the State affected by a State law and the State. Selecting a contract, arrangement or opportunity offered by an employer out of the State of New South Wales to a person in New South Wales would be a sufficiently relevant connection with New South Wales to support the valid law of its State Parliament having effective operation upon persons who would be rendered answerable to its courts and judicial process", and he referred to Mynott v Barnard in Ballantyne v The WorkCover Authority of New South Wales unrep CCA 40740/06.

27 It was said in the judgment of Basten JA at p 25 para (124):

"Although the reason was elliptical, the point being made by the Commission was reasonably clear. As explained above, the question of connection with New South Wales as determined in accordance with Mynot v Barnard, depended entirely upon the place where the accident occurred".

28 In my view, the submission by the defendant cross-claimant that the penal nature of the statute precludes the interpretation contended for by the second cross-defendant is not correct. And, the further contention by the defendant cross-claimant that the test to be applied is where the contract of employment was made, is not correct either.

29 At the beginning, I indicted that I believed that there was no relevant distinction in the tests to be applied in determining the applicability of s 155 and s 13. The test that has been relied upon in respect of s 13 is a test which relates to a real connection with the State on the basis of the New South Wales authorities, and I have quoted the Queensland authorities which have adopted the test of a relevant connection with the State which is something more than "fortuitous, fleeting or sufficiently unusual".

30 There is a further argument in this case on behalf of the defendant cross-claimant. It is submitted that if the defendants' arguments are incorrect up until this point, then even if it comes to the point of determining whether there is a relevant connection, there is no relevant connection here.

31 Before I move to that, I should refer to the authorities which set out the test for a relevant connection with New South Wales. I have already referred to the decision of the High Court in Mynot & Ors v Barnard where although the judgments of the court vary, it appears that the statement that the mere fact that the accident occurred in New South Wales might be sufficient, has found some degree of favour.

32 I have already also referred to the case of The Commissioner of Railways for the State of Queensland v Peters, where there were a number of factors mentioned as possibly providing a connection, and there was a reference there made to "A contract, arrangement or opportunity offered by an employer".

33 That of course has encouraged the defendant cross-claimant to argue that a contract or agreement of some sort within New South Wales is necessary to ground the relevant jurisdiction. But, that is not the way the cases have gone on to interpret the test to be applied in New South Wales.

34 In Ballantyne v The WorkCover Authority of New South Wales, an unreported judgment of the Court of Appeal 40740/06, Basten JA referred to the fact that in Mynot a number of factors were dismissed as inappropriate or irrelevant, but, the place where the accident occurred was relied upon, and I have referred earlier to that passage.

35 In Stanley v Gallagher, another unreported decision of the Court of Appeal in New South Wales numbered 40537/01, Pearlman AJA with whom Steen and Hayden JJA agreed, referred to the line of authorities which I have been referring to, and said at p 6:

"But there were other connectors with New South Wales. The appellant was resident in New South Wales, the injury occurred whilst he was on a journey from his place of abode in New South Wales. His actual engagement to ride came into existence in New South Wales when he was asked to do so by the trainer, and he accepted that offer and he was paid a fee to ride by the Gold Coast Turf Club, out of money paid to it for that purpose in the trainer.

36 In addition to all these matters, there was an amount of transport or employment regularly carried out on racetracks. Jockeys from New South Wales regularly rode in Queensland and vice versa and the appellant himself had regularly ridden at race meetings conducted by the Gold Coast Turf Club".

37 I also note in Ballantyne v The WorkCover Authority of New South Wales, to which I have alredy referred, at p 13 in para (65), Basten JA said:

"Accordingly, the basic premise upon which the Workers Compensation Act operated (until 1 January 2006), was that it might apply to any person employing a worker who might undertake work in New South Wales, or who might in the course of his or her employment, including no doubt the journey to and from the workplace, pass through New South Wales or part thereof in the event of an accident there."

38 Although some of those cases refer to the contract of employment or an agreement and the place where it was made, in my view that is only one factor that has been nominated as providing a connection with New South Wales. It appears to me, from the totality of the authorities, that they do not regard that as being the only test.

39 Indeed, one view of the authorities from Mynot v Barnard onwards, is that simply the fact of the accident occurring within New South Wales is a sufficient connector. However, that is not the case here, and what has to be considered here are the facts of this case. I indicated at the beginning what the agreed facts were, and the agreed facts were that the semi trailer being driven by the plaintiff and the defendant, covered nine trips between Brisbane and Melbourne between 24 November 2003 and 8 December 2003.

40 It is clear that at least a part of, if not all of the business of TDS was transport, including interstate transport, and interstate transport by means of a semi trailer travelling from Queensland through New South Wales to Victoria was an accepted part of their business.

41 In the ordinary course of events, a journey by way of a semi trailer from Queensland to Victoria would include things like stopping and refuelling, stopping and resting, having log books checked, going through weighing stations and generally abiding by the laws of New South Wales relating to road transport.

42 In those circumstances, in my view, this is a case where there was a sufficient connection to New South Wales to require the employer under s 155 of the Workers Compensation Act to take out insurance as required by the New South Wales Act.

43 Having come to that conclusion, it then brings into play s 10(2)(b) of the Queensland Act, and in those circumstances, the answer that I make to the question posed is no meaning that there is no obligation on the second cross-defendant to indemnify the first cross-defendant, and accordingly I dismiss the action brought by the defendant cross-claimant against the second cross-defendant, and make an order as to costs.

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