Fuller v K & J Trucks

Law Reform (Miscellaneous) Provisions Act 1946 (NSW) s.5(1)(c) LEGISLATION CITED: Motor Accidents Compensation Act 1999 (NSW) ss.3, 5, 6, 43, 44(1)(d), 58, 59, 60, 61, 64(3), 94, 95, 122(1), 122(2), 131, 132(1), 133(1), 134 Workers Compensation Act 1987 (NSW) ss.10, 151Z, 151Z(1)(d), 151Z(2)(c) & (d)

Brambles Constructions Pty Ltd v Helmers (1966) 114 CLR 213 Commonwealth of Australia v Flaviano (1996) 40 NSWLR 199 Cory & Son Ltd v France, Fenwick & Co. Ltd [1911] 1 KB 114 Forstaff Blacktown Pty Ltd v Brimac Pty Ltd ; Brimac Pty Ltd v Johnston [2005] NSWCA 423 Government Insurance Office (NSW) v C.E. McDonald (NSW) Pty Ltd (1991) 25 NSWLR 492 Grant v Royal Rehabilitation Centre Sydney (1999) 47 NSWLR 263 Hamilton v Merck & Co. Inc [2006] NSWCA 55 CASES CITED: Harding v Lithgow Municipal Council (1937) 57 CLR 186 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 Kavanagh v Sutherland Shire Council & Anor [2000] 21 NSWCCR 1 Shirwell v Hackwood Estates Co. Ltd (1938) 2 KB 577 Smith's Dock Company v John Readhead & Sons [1912] 2 KB 323 Tickle Industries Pty Ltd v Hann & Richardson (1974) 130 CLR 321 Tooth & Co. Ltd v Tillyer (1956) 95 CLR 605 Tuckwood v Mayor of Rotherham [1921] 1 KB 526 Westpac Banking Corporation v Tomassian (1993) 32 NSWLR 207

PARTIES: Appellant - Craig Adam Fuller Respondent - K & J Trucks Coffs Harbour Pty Ltd

COUNSEL: Appellant - R.R. Bartlett / C. Hickey Respondent - L. King SC / M. Jenkins

SOLICITORS: Appellant - McCourts Respondent - Rankin & Nathan

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40161 of 2005

HANDLEY JA IPP JA BRYSON JA

26 April 2006 CRAIG ADAM FULLER v K & J TRUCKS COFFS HARBOUR PTY LTD Judgment 1 HANDLEY JA: I agree with Bryson JA. 2 IPP JA: I do not express any opinion as to whether ss 131 and 132 of the Motor Accidents Compensation Act are procedural or substantive. 3 In my view the resolution of ground 1 of the notice of appeal does not require this issue to be determined. 4 For the reasons set out by Bryson JA in paragraphs [24] to [28], [37] to [39], [42] and [45] to [46], I agree that ground 1 of the notice of appeal should be dismissed. 5 In regard to the other challenges to the judgment of the trial judge, I agree, for the reasons expressed by Bryson JA, that they should not be upheld. 6 I agree with the orders proposed by Bryson JA. 7 BRYSON JA: Mr Christopher Kearney was severely injured in a motor accident on 19 April 2000 while he was riding his motorcycle from his workplace in Coffs Harbour to his home at Lowanna. He was riding westward on Ridge Road, a dirt road in heavily timbered country, when his motorcycle collided with a Toyota Hi-Lux four-wheel-drive utility travelling in the opposite direction and driven by Mr Craig Fuller the appellant. The respondent K & J Trucks Coffs Harbour, Mr Kearney's employer, paid workers compensation to Mr Kearney because his injury was received on his daily journey home between his place of employment and his place of abode; see s.10 of the Workers Compensation Act 1987 (NSW). Mr Kearney did not bring any proceedings against Mr Fuller claiming damages for his personal injuries under common law; if he had done so, his claim would have been regulated by the Motor Accidents Compensation Act 1999 (NSW) (MACA). Mr Kearney's reasons for not suing for damages are not known but his decision is not surprising because the MACA limits his entitlements in various ways, and his damages would have been reduced for his contributory negligence; on the Trial Judge's findings his damages would have been less than his workers compensation has been. 8 K & J Trucks sued Mr Fuller in the District Court at Newcastle by Statement of Claim filed on 21 February 2003, and claimed to be indemnified by Mr Fuller for the compensation paid to Mr Kearney. The right to indemnity claimed by K & J Trucks is conferred by s.151Z(1)(d) of the Workers Compensation Act 1987. Section 151Z is elaborate, deals in various ways with a worker's entitlement to damages, and confers rights on an employer who has paid compensation: 151Z Recovery against both employer and stranger (1) If the injury for which compensation is payable under this Act was caused under circumstances creating a liability in some person other than the worker's employer to pay damages in respect of the injury, the following provisions have effect:

(d) if the worker has recovered compensation under this Act, the person by whom the compensation was paid is entitled to be indemnified by the person so liable to pay those damages (being an indemnity limited to the amount of those damages),

... 9 A claim for indemnity under s.151Z(1)(d) is not a claim for damages; see Westpac Banking Corporation v Tomassian (1993) 32 NSWLR 207 especially Mahoney JA at 215-216. 10 To recover an indemnity it was necessary for K & J Trucks to prove and obtain findings that the injury to Mr Kearney was caused under circumstances creating a liability in Mr Fuller to pay damages in respect of the injury; and it was also necessary to establish the amount of those damages, or rather to show that the compensation paid was within the limit of the amount of those damages; so much compensation was paid that it was as a practical matter necessary to obtain a decision establishing how much damages Mr Fuller was liable to pay Mr Kearney. It has been assumed throughout that the onus lay on K & J Trucks, and not on Mr Fuller, to establish what the limit is. In Grant v Royal Rehabilitation Centre Sydney (1999) 47 NSWLR 263 at 265 [8] Cole AJA gave the following account of the limitation on indemnity: [8] Accordingly, to determine whether the sum which has been paid as compensation is recoverable from the tortfeasor, two steps are necessary. The first is to determine the quantum of common law damages which would have been recoverable had they been sued for. The second is to determine the amount of compensation which has been paid. The amount of the indemnity provided by s 151Z(1)(d) is limited by the former determination. If the amount claimed by way of indemnity is less than the amount of damages so determined, the employer or insurer making continuing payments of compensation can further claim under the indemnity at a later point in time up to the limit of the sum determined as the amount of damages which the injured worker would have recovered at common law. 11 K & J Trucks' claim was heard by her Honour Judge Sidis at the District Court at Newcastle on three days commencing 2 February 2005 and her Honour gave judgment on 11 February 2005. The Trial Judge apportioned responsibility equally and acted on the view that Mr Kearney's injury was caused under circumstances creating a liability in Mr Fuller to pay one half of Mr Kearney's damages. Her Honour assessed all the major elements of Mr Kearney's damages:

Non-economic loss $140,000.00 Past Out-of-pocket expenses $130,592.58 Future surgery, medication and therapy $ 15,000.00 Fox v Wood component $ 2,871.21 Past wage loss $ 76,640.00 Future economic loss $ 75,000.00 Loss of superannuation entitlements $ 12,881.20 $452,984.99 12 The indemnity to which K & J Trucks was entitled was limited to $226,492.49, one half of the damages. This was less than had been paid to or for Mr Kearney as compensation. After some calculation her Honour entered a verdict and judgment on 17 February 2005 for $226,492.49 and interest, a total of $295,679.30; and also costs. 13 Ground 1 in the Amended Notice of Appeal is as follows: 1. Her Honour erred in finding that the Respondent was entitled to an indemnity to an extent which allowed for damages for non-economic loss payable to the worker to which the worker was not in fact pursuant to Section 131 of the Motor Accidents Compensation Act 1999 entitled. 14 If $140,000.00 for non-economic loss should not have been included in the assessment of Mr Kearney's damages, Mr Fuller's liability to pay Mr Kearney damages would have been $70,000.00 less and there would be corresponding diminution in the indemnity and interest. 15 In a letter of 8 September 2004 (Blue 119) Mr Fuller's solicitors told K & J Trucks' solicitors that the reports of Dr Ashwell would be objected to, and spelt out grounds which related to the contention that K & J Trucks was unable to prove damages in relation to non-economic loss unless the degree of permanent impairment was established in the way for which MACA provides. From this letter, and from K & J Trucks' later having successfully tendered Dr Ashwell's report, it appears clearly that there was disagreement between K & J Trucks and Mr Fuller about the means of proving the degree of permanent impairment. 16 On behalf of Mr Fuller it was contended that in circumstances where Mr Kearney had not made a claim and therefore there had been no determination of entitlement to damages for non-economic loss under the machinery provided for in the MACA, K & J Trucks was unable to prove that Mr Kearney would have been entitled to such damages; cannot establish that any damages were payable in respect of non-economic loss; and the indemnity is correspondingly limited. The contention went further: unless the machinery has been followed, Mr Kearney had no entitlement to damages for non-economic loss. This contention related to and was supported by reference to a number of provisions of MACA. The principal provision is s.131: 131 Impairment thresholds for award of damages for non-economic loss No damages may be awarded for non-economic loss unless the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident is greater than 10%. 17 Related to s.131 are provisions for determining the degree of permanent impairment. Section 132(1) provides: 132 Assessment of impairment required before award of damages for non-economic loss if dispute over impairment threshold (1) If there is a dispute about whether the degree of permanent impairment of an injured person is sufficient for an award of damages for non-economic loss, the court may not award any such damages unless the degree of permanent impairment has been assessed by a medical assessor under Part 3.4 (Medical assessment).

Section 133(1) requires assessment of the degree of permanent impairment to be expressed as a percentage, and deals with that manner of expression.

18 Counsel for Mr Fuller referred to a number of other provisions of MACA. These included s.122(2) to the effect that Ch. 5 Award of Damages applies to and in respect of an award of damages which relates to injury to a person caused by the fault of the owner or driver of a motor vehicle. Counsel also referred to the definitions in s.3 of "claim", "claimant" and "insured person", to the objects of the Act as stated in s.5 and to the principles of interpretation referred to in s.6. "Claimant" is defined in s.3 in a way which cannot include K & J Trucks. Counsel also referred to the provisions of Ch. 3 Motor Accident Injuries Pt.3.4 Medical Assessment which contains provisions for determination by medical assessment of disagreements between the claimant and insurer about a number of matters including degree of permanent impairment. There is a cross-reference in s.132(1) to Pt.3.4. 19 Chapter 3 opens with Pt.3.1 Preliminary, and contains s.43. 43 Application of Chapter (1) This Chapter applies to and in respect of an injury caused by a motor accident occurring after the commencement of this Act. (2) This Chapter applies to and in respect of an injury whether or not there is a third-party policy in respect of liability for the injury. 20 Part 3.4 contains provisions for the Appointment of Medical Assessors (s.59), Medical Assessment Procedures (s.60) and the Status of Medical Assessments (s.61); unless challenged on limited grounds, a medical assessment is conclusive evidence on various matters including the degree of permanent impairment. The gateway into Pt.3.4 is s.58: 58 Application (1) This Part applies to a disagreement between a claimant and an insurer about any of the following matters: (a) whether the treatment provided or to be provided to the injured person was or is reasonable and necessary in the circumstances, (b) whether any such treatment relates to the injury caused by the motor accident, (c) whether an injury has stabilised, (d) the degree of permanent impairment of the injured person as a result of the injury caused by the motor accident, (e) the degree of impairment of the earning capacity of the injured person as a result of the injury caused by the motor accident. (2) This Part also applies to any issue arising about such a matter in proceedings before a court or in connection with the assessment of a claim by a claims assessor. 21 The reference in s.58(2) to a claims assessor takes one to Pt.4.4 Claims Assessment and Resolution and provisions for the appointment and functions of claims assessors, who are officers of the Motor Accidents Authority and make non-binding assessments of claims; see ss.94 and 95.

22 Senior Counsel for Mr Fuller contended that ss.131 and 132 are substantive provisions and are jurisdictional provisions so that until they are enlivened there is no entitlement to include non-economic loss in an assessment of damages; no entitlement of any person, including no entitlement of K & J Trucks and no entitlement for any purpose, including an indemnity under s.151Z(1)(d). Counsel illustrated the reference to substantive provisions and jurisdictional provisions by citing John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 542-544 [97]-[100]. He contended that an effect of s.132(1) is that if there is a dispute about the degree of permanent impairment the Court may not know the degree of permanent impairment and may not award damages unless the degree of permanent impairment has been assessed by a medical assessor in the manner provided for. Counsel referred to the letter of 8 September 2004 between the parties' solicitors in which the existence of a dispute was asserted on behalf of the appellant. 23 If it is possible to step outside the procedures for determining the degree of permanent impairment of Mr Kearney and to determine that degree without compliance with Ch. 5 Pt.5.3 of MACA there can, in my opinion, be no reasonable ground for debate that Mr Kearney suffered a degree of permanent impairment greater than 10%. The description of Mr Kearney's treatment and long term condition given in the reports of Dr Ashwell was not contested, and a finding well in excess of 10% is obviously justified by Dr Ashwell's reports. Judge Sidis did not express a finding about degree of permanent impairment in terms of a percentage, but found that Mr Kearney's whole person impairment was 23%. If the degree of permanent impairment can be established by such a finding, s.131 presents no further obstacle to the allowance of damages for non-economic loss. The amount awarded is within the maximum prescribed under s.134.

24 Chapter 5 opens with s.122(1): 122(1) This Chapter applies to and in respect of an award of damages which relates to 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. 25 It might be said that in logic, although the parties to these proceedings cannot refer medical disputes for assessment under Pt.3.4, a court can do so, as "a court" is referred to in s.60(1). In logic it might be thought that this provides an avenue by which the court might pass by the prohibition on awarding damages in s.132(1), even though no party to the proceedings before the court was enabled by s.58 to do so. The convolution of this reasoning tends to support the conclusion that the provisions relating to medical assessment are only open in disputes and court proceedings involving the persons referred to in s.58(1), a claimant and an insurer. 26 In my opinion on the reasonable reading and correct construction of Pt.3.4 and s.58 they apply to claims made by claimants to insurers, and to processes for such claims which are themselves prescribed by MACA, including processes in which medical assessments and assessments by claims assessors have defined places. Although s.58(2) and its reference to proceedings before a court could, on an altogether literal meaning, make Pt.3.4 apply to any proceedings in which an issue of the kind referred to in s.58(1) arises, context shows that s.58 is part of a series of provisions relating to handling and determining claims, and that the proceedings before a court which are referred to are proceedings relating to such claims, to claimants as defined, to insurers as defined and to their disagreements about claims.

27 MACA does not spell out what the process of medical assessment is or what is to happen on a medical assessment. Procedure for assessment is one of the subjects on which the Authority may issue MAA medical guidelines; see s.44(1)(d). The concept of assessment by medical assessors, who are to be medical practitioners or other suitably qualified persons (s.59(1)), seems to require that, at least in the ordinary course, assessment should take place on the basis that examination of the claimant is or is part of the sources of information on which medical assessment is made. Section 64(3), which includes costs and expenses of travel and accommodation incurred by the injured person in attending a medical assessor among the costs of medical assessments which are payable by the insurer, shows contemplation that the injured person may attend for assessment. The nature of the matters to which an assessment relates, indicated in s.58(1), strongly supports the view that examination of the injured person, if examination is possible, will be an ordinary part of the process of assessment. However MACA contains no provision relating to compulsion of the injured person to attend and submit to examination; securing attendance appears to be left by MACA to the interests of the injured person in pursuing a claim, which could not be resolved without a medical assessment. The difficulties of compelling attendance are illustrated by observations of Judge Curtis and authorities cited by his Honour, in a context of other legislation, in Kavanagh v Sutherland Shire Council & Anor [2000] 21 NSWCCR 1. The view that Pt.3.4 Medical Assessment applies only to a disagreement, or to an issue in proceedings before a court, between a claimant and an insurer is reinforced by the difficulties of applying it to a dispute between any other persons. 28 The procedure in Pt.3.4 for medical assessment is simply not available to K & J Trucks or to its workers compensation insurer. Senior Counsel for Mr Fuller accepted that it is an effect of his submission that K & J Trucks cannot actually obtain a medical assessment unless Mr Fuller voluntarily participates in their doing so; I doubt the qualification. The present proceedings cannot be integrated into the workings of Pt.3.4 because neither a claimant such as Mr Kearney nor an insurer is a party to the proceedings, there cannot be a disagreement of the kind referred to in s.58(1) and there cannot be any business for consideration by a medical assessor or a claims assessor. It is not open to either of the parties to the present proceedings to bring about a referral for assessment under s.60 as neither can be a party to a dispute of the kind to which Pt.3.4 applies. 29 When read literally, s.132(1) operates to forbid the court to award any damages unless the degree of permanent assessment has been assessed by a medical assessor. That prohibition operating literally did not prevent the Trial Judge from awarding an indemnity, which is a distinct subject to the forbidden award of damages. 30 Mr Fuller's contention was, as I understood it, to the effect that unless there has been an assessment by a medical assessor there can be no finding establishing the non-economic loss which is part of Mr Kearney's damages in relation to finding whether his injury was caused under the circumstances creating a liability to Mr Fuller to pay damages in respect of the injury. It is at this point that counsel's references to the substantive nature of s.132, as well as s.131, are relevant; the contention is to the effect that Mr Kearney has no entitlement to the inclusion of non-economic loss damages in his damages unless there has been a medical assessment and a court could (if asked, and no court has been asked) award Mr Kearney damages. 31 John Pfeiffer Pty Ltd v Rogerson related to the applicability, in litigation in the Australian Capital Territory, of a statute of New South Wales which limited the amount of damages that could be awarded for non-economic loss; as it happens, provisions in Pt.5 of the Workers Compensation Act. In deciding that this statute applied when assessing damages in the ACT the High Court held (by majority) that the law governing all questions of substance in Australian Tort litigation involving an interstate element was the lex loci delicti, and (unanimously) that the limitation on damages was a matter of substance rather than procedure, and therefore was governed by the lex loci delicti. In the leading judgment (Gleeson CJ, Gaudron, McHugh, Gummow & Hayne JJ) Substance and Procedure are dealt with at pages 542-544 [97-100]; see too Kirby J. at 563 [161]. In the leading judgment their Honours said: Substance and procedure [97] As already indicated, the choice of law rules traditionally distinguish between questions of substance and questions of procedure. There is much history that lies behind the distinction, but search as one may, it is very hard, if not impossible, to identify some unifying principle which would assist in making the distinction in a particular case. But, as the majority said in McKain : Though the dividing line is sometimes doubtful or even artificial, the need to distinguish between substantive law and procedural law is clearly recognized for a number of forensic purposes. (1991) 174 CLR 1 at 40; 104 ALR 257 at 277.

[98] Some statutes of limitation have traditionally been held to be procedural on the basis that they bar the remedy not the right; ( Huber v Steiner (1835) 2 Bing (NC) 202 ; 132 ER 80; Harris v Quine (1869) LR 4 QB 653; Alliance Bank of Simla v Carey (1880) 5 CPD 429; Noske v McGinnis (1932) 47 CLR 563; Pedersen v Young (1964) 110 CLR 162; John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 ; 1 ALR 21; Bargen v State Government Insurance Office (Qld) (1982) 154 CLR 318 ; 41 ALR 65; Commonwealth v Verwayen (1990) 170 CLR 394 ; 95 ALR 321 at CLR 473-4 per Toohey J; McKain v R W Miller & Co (SA) Pty Ltd (1991) 174 CLR 1 ; 104 ALR 257.) other limitation provisions have been held to be substantive. (Maxwell v Murphy (1957) 96 CLR 261; Commonwealth v Dixon (1988) 13 NSWLR 601 ; 82 ALR 359 at NSWLR 611 per Hope JA, 612 per Samuels JA; Byrnes v Groote Eylandt Mining Co Pty Ltd (1990) 19 NSWLR 13 ; 93 ALR 131 at NSWLR 25 per Kirby P, 39 per Hope AJA.) But all limitation provisions can affect whether a plaintiff recovers. Questions of what heads of damage are allowable have been held to be substantive; but questions of quantification of damages have been held to be procedural. (Stevens v Head (1993) 176 CLR 433 ; 112 ALR 7 at CLR 457 per Brennan, Dawson, Toohey and McHugh JJ; cf at 447-51 per Mason CJ. See also Livesley v Horst Co [1925] 1 DLR 159; J D'Almeida Araujo Lda v Sir Frederick Becker & Co Ld [1953] 2 QB 329; Chaplin v Boys [1971] AC 356; Breavington v Godleman (1988) 169 CLR 41 ; 80 ALR 362.) But all questions about damages can affect how much a plaintiff recovers and, thus, statutes such as the NSW Compensation Act, which is in issue in this case, alter the rights of plaintiffs and, also, the obligations of defendants.

[99] Two guiding principles should be seen as lying behind the need to distinguish between substantive and procedural issues. First, litigants who resort to a court to obtain relief must take the court as they find it. A plaintiff cannot ask that a tribunal which does not exist in the forum (but does in the place where a wrong was committed) should be established to deal, in the forum, with the claim that the plaintiff makes. Similarly, the plaintiff cannot ask that the courts of the forum adopt procedures or give remedies of a kind which their constituting statutes do not contemplate any more than the plaintiff can ask that the court apply any adjectival law other than the laws of the forum. Secondly, matters that affect the existence, extent or enforceability of the rights or duties of the parties to an action are matters that, on their face, appear to be concerned with issues of substance, not with issues of procedure. Or to adopt the formulation put forward by Mason CJ in McKain , (1991) 174 CLR 1 at 26-7; 104 ALR 257 "rules which are directed to governing or regulating the mode or conduct of court proceedings" are procedural and all other provisions or rules are to be classified as substantive. (Stevens v Head (1993) 176 CLR 433 ; 112 ALR 7 at CLR 445 per Mason CJ)

[100] These principles may require further elucidation in subsequent decisions but it should be noted that giving effect to them has significant consequences for the kinds of case in which the distinction between substance and procedure has previously been applied. First, the application of any limitation period, whether barring the remedy or extinguishing the right, would be taken to be a question of substance not procedure (which is the result arrived at by the statutes previously referred to). The application of any limitation period would, therefore, continue to be governed (as that legislation requires) by the lex loci delicti. Secondly, all questions about the kinds of damage, or amount of damages that may be recovered, would likewise be treated as substantive issues governed by the lex loci delicti.

32 Although these passages contain statements which, viewed narrowly, could be thought to be of assistance in understanding Ch.5 of MACA, their Honours' considerations and the law to which their observations were addressed relate closely to the subject matter there under decision, that is the place of statute law about damages in Choice of Law rules. Paragraph [100] clearly shows, to my reading, that their Honours carefully restated and consciously altered what had earlier been understood to be the Choice of Law rules relating to the award of damages. The concluding sentence of the passage cited, under which all questions about the kinds of damage or amount of damages that may be recovered are to be treated as substantive issues, cannot be severed out from the Choice of Law context in which their Honours spoke.

33 In my opinion John Pfeiffer Pty Ltd v Rogerson is not authority for the conclusion that s.132(1) and related provisions relating to ascertaining the degree of permanent impairment by medical assessment are substantive rules about entitlement to non-economic loss in personal injury damages. Section 132(1) and Pt.3.4 relate to the procedure to be followed before the court may award damages for non-economic loss. They are plainly procedural, and have no application except according to their terms; they enable a medical assessment to take place, give effect to medical assessments, and prevent the Court from awarding damages otherwise than in accordance with the medical assessment, but they do not enact any underlying or general principle about entitlement. They take effect only according to their terms. I do not see s.131 as procedural in the same way as s.132(1); and I make the same observation of s.134(1). Notwithstanding its opening words I see no difficulty in recognising s.131 as going beyond a procedural requirement limiting what a court may do and enacting a substantive rule disentitling injured persons from inclusion of non-economic loss in an award of damages except in the circumstances stated. Section 131 changes the law of entitlement to damages and goes beyond putting a procedural obstacle in the path of injured persons. If it were necessary or useful to make a classification I would classify ss.131 and 134(1) as substantive, by which I mean that they affect and limit any liability to pay damages to Mr Kearney referred to in s.151Z(1)(d). There is a full and clear contrast with the provisions of s.132(1) which imposes procedural requirements on an award of damages, but has no application except in proceedings in which the Court is asked to make an award of damages to a claimant. 34 An attempt to apply ss.131 and 132 to a hypothetical lawsuit in a State other than New South Wales, or in another country, illustrates differences in the way which those two sections operate. Adopting terminology of the last sentence of para [100] of John Pfeiffer Pty Ltd v Rogerson, there can be no difficulty in recognising s.131 as a question about the kind of damage or amount of damages that may be recovered, which should be treated as a substantive issue governed by the law of New South Wales in litigation in another State. It does not seem to me to be possible to suppose that their Honours would have classified the provisions of s.132(1) as a question which should be treated as a substantive issue in the Choice of Law for litigation in another State, because the procedure and machinery for medical assessment are available only in New South Wales.

35 John Pfeiffer Pty Ltd v Rogerson, and the distinction between Procedure and Substance, were considered in Hamilton v Merck & Co. Inc [2006] NSWCA 55 in a Choice of Law context: see the judgment of Spigelman CJ generally and in particular paras [53] to [67] and the judgment of Handley JA. Their Honours' consideration illustrates, to my mind, that the distinction is not a clear or concrete distinction, and that a distinction drawn in one field of law cannot be confidently applied in another. 36 Having said this however I again say that in my understanding John Pfeiffer Pty Ltd v Rogerson was directed at Choice of Law in litigation in Australian States, and the classification which their Honours made in para [100], and their observations generally, are not directed to questions of statutory construction such as that now under consideration. 37 Thus far my consideration has been closely restricted to the terms of MACA itself. Similar conclusions have been reached in a number of instances where claims were made under s.151Z(1)(d) or similar or predecessor legislation, and were answered by claimed reliance on difficulties of various kinds which would have presented themselves to the worker if he had brought proceedings to enforce the liability of some person other than the employer to pay damages in respect of his injury. In cases of obstacles closely and more distantly analogous to the barriers which s.132(1) and related provisions would have posed to a claim by Mr Kearney had he brought one, courts have shown no tendency to import such barriers into claims for indemnity for workers compensation.

38 In Smith's Dock Company v John Readhead & Sons [1912] 2 KB 323 the employer claimed indemnity for compensation paid to the illegitimate daughter of his workman, where the workman had been injured and after a few days had died as a result of the defendant's negligence. Under the law of that time the claim for damages of the workman against the person who had injured him did not survive his death; and also the illegitimate daughter had no claim for damages against that person. The death of the workman brought to an end the liability of the defendant to pay damages in respect of his injury but that did not affect the proceedings for indemnity which the employer brought later; nor did the fact that the indemnity related to the workman's compensation paid to the illegitimate daughter. Similar conclusions were reached, on legislation in England, in Cory & Son Ltd v France, Fenwick & Co. Ltd [1911] 1 KB 114 and in Tuckwood v Mayor of Rotherham [1921] 1 KB 526. 39 In Tickle Industries Pty Ltd v Hann & Richardson (1974) 130 CLR 321 the worker was killed in the course of his employment and his employer paid workers compensation to his dependants; the dependants did not claim damages under Fatal Accidents legislation and became time-barred by a twelve-month limitation; the employer thereafter sought indemnity and was held to be entitled to indemnity notwithstanding that at the date of the claim for indemnity the employee's dependants had no right of action. See too Government Insurance Office (NSW) v C.E. McDonald (NSW) Pty Ltd (1991) 25 NSWLR 492, where the worker sued the tortfeasor but consented to judgment against himself; this did not bar the claim for indemnity.

40 Tooth & Co. Ltd v Tillyer (1956) 95 CLR 605 is a contrasting case where the defendant had no liability at any time to pay damages and hence had no liability to indemnify the employer. As a worker's husband the defendant was under the law of that time immune at all times from liability for damages to her. See too Shirwell v Hackwood Estates Co. Ltd [1938] 2 KB 577. 41 There are analogies, perhaps a little distant, in Harding v Lithgow Municipal Council (1937) 57 CLR 186, where a Compensation to Relatives claim was not barred by the fact that the deceased at the time of his death had no legal right to maintain an action against the defendant because he had not given notice of action, and in Brambles Constructions Pty Ltd v Helmers (1966) 114 CLR 213 where a claim for contribution between concurrent tortfeasors was not barred by a time limitation which would have barred a claim by the injured person to whose damages contribution was sought. A yet more distant claim to analogy was made by counsel who referred to Commonwealth of Australia v Flaviano (1996) 40 NSWLR 199; I find no assistance there.

42 The approach the Court should make treats the reference, in the opening words of s.151Z, to the cause of injury and those circumstances creating liability to pay damages as related to the time when the injury occurred, and not to some later time such as when the employer brought proceedings for indemnity.

43 We were referred to the terms of the Second Reading Speech of the Minister who conducted the Bill for MACA through the Legislative Assembly; but in my opinion that speech contains no expression which could be thought to either illustrate the existence of or to resolve any ambiguity, or the difficulty of construction now under consideration. 44 We were referred to Forstaff Blacktown Pty Ltd v Brimac Pty Ltd ; Brimac Pty Ltd v Johnston [2005] NSWCA 423 in which there were observations relating to the operation of s.151Z(2)(c) and (d) and their interaction with s.5(1)(c) of the Law Reform (Miscellaneous) Provisions Act 1946 (NSW). There are some divergences in observations in judgments in Forstaff, principally on the onus of proof, in the circumstances of that litigation, of facts relevant to s.151Z(2)(c). The question in difference in Forstaff related to the operation of medical assessment procedure in Workers Compensation legislation which has some general similarities with the medical assessment procedures now under consideration. In my respectful view those observations and the decision in Forstaff do not bear on the present issues.

45 In my opinion provisions of the MACA which create machinery which must be observed in proceeding to an award of damages to which that Act relates have no application to K & J Trucks' claim for indemnity. There was no claim for an award of damages, and Mr Kearney is not a party to the proceedings and will not receive any of the proceeds. There is no prospect of Mr Kearney's being awarded damages for non-economic loss as the time for him to sue for damages has passed, and there is no room for the application of s.131 to him. Nor is there room for the application of s.132 as Mr Kearney is not and cannot be in dispute with an insurer or with anyone about the degree of his permanent impairment. Part 3.4 Medical Assessment cannot apply, because it applies to a disagreement between the claimant and an insurer about stated matters, and there is no such disagreement. 46 It was necessary for K & J Trucks to establish the amount in respect of which there was a liability of Mr Fuller to pay damages in respect of Mr Kearney's injury, but the statutory machinery regulating the determination of the amount of Mr Kearney's damages has no application because it applies only to a claim for damages by Mr Kearney and the award of damages to him. If it is to be established in proceedings under s.151Z(1)(d) what damages Mr Kearney suffered the amount of those damages can be determined by the Court, in much the same way as the Court can determine other complex questions; the unavailability of the machinery by which the amount of Mr Kearney's claim would have been decided if he made a claim is not a difficulty for making this determination. If the actual facts are proved it is reasonable to decide that as a matter of probability, the process through which Mr Kearney would have had to pass if he had made a claim would have produced a result which accorded with the actual facts; that is a reasonable way of assessing the probabilities, and much more likely to be correct than to suppose or to act on the supposition that the machinery would have produced a decision that Mr Kearney was not entitled to anything for non-economic loss. The question is not how much damages should be awarded to Mr Kearney, but how much are the damages which the circumstances in which Mr Kearney's injury was caused created a liability in Mr Fuller to pay in respect of the injury: the provisions of s.151Z(1) show that the amount of those damages may fall to be decided in circumstances in which an injured worker does take proceedings and recover damages, but also in circumstances in which he does not. The machinery provisions with which Mr Kearney and others concerned in his claim would have had to comply if he made one cannot be complied with; but the provisions which require compliance with them have no application to K & J Trucks' claim under s.151Z(1)(d). 47 I would not uphold Ground 1. 48 The Notice of Appeal also challenged the Trial Judge's decision that Mr Fuller was liable in negligence to pay damages to Mr Kearney.

49 The collision occurred in fine weather and in daylight. Both drivers had driven over this road many times. The road was a dirt road in heavily timbered mountain country, very steep in sections with a multitude of bends and curves. Photographs in evidence illustrate the type of road, although it was not established whether they depict the site of the collision. The photographs generally show a road consisting of one pair of wheel tracks which would carry traffic in both directions, with room beside the wheel tracks for vehicles to pass with care. 50 In her judgment the Trial Judge gave a fairly long narration of the effect of the evidence, particularly the evidence of Mr Kearney and Mr Fuller relating to the events and the collision. This narration takes the form of stating the effect of the evidence, without finding facts or indicating whether the evidence or passages in it were accepted. The conclusory passages in which it might be understood that facts are found are relatively short. 51 Mr Kearney's evidence, as narrated by her Honour, was to the effect that immediately prior to the accident he was riding up a fairly steep slope in third gear at approximately 40 km per hour. He said that road conditions, including at some places quartz rocks on the road, made it necessary for him to travel the road with caution and limited his speed. He said it would have been impossible to ride a motorcycle at 60 km per hour on the part of the road where the collision happened. He travelled around a left-hand bend, and was to the left of the centre of the road; he saw the Toyota vehicle driven by Mr Fuller coming around the next right hand bend at a very fast speed when he was about 40 m away from it; he braked, brought the motorcycle upright, dropped back into second gear and tried to move to the left-hand side of the road; the Toyota headed to the left-hand side of the road, meaning Mr Kearney's left-hand side of the road; Mr Kearney turned his motorcycle to a 45° angle towards the left, the front wheel was at the edge of the road and he was unable to move any further out of the path of the Toyota, and he was struck by the bull bar. As the ground on his left side of the road dropped away steeply his options were to go over the side or to strike the bull bar on the Toyota. In Mr Kearney's account, the Toyota was still moving at the point of collision and Mr Kearney was dragged 4 or 5 metres downhill until the Toyota stopped; and Mr Kearney was then thrown further. Mr Kearney said that at the time of impact the Toyota was well over to Mr Kearney's left from the centre of the road, so that there was only 1 to 1 ½ feet between the offside wheel of the Toyota and the point where the road dropped away; but that there was 1 ½ to 2 m of space on the other side, that is the Toyota's near side. 52 Mr Kearney described the action of the Toyota as drifting, and said that when its brakes were applied it drifted even more to Mr Kearney's left, onto the side of the road, and there was nowhere to the side of the vehicle where Mr Kearney could go. Mr Kearney's evidence clearly depicted the Toyota as having been in the centre of the road when the brakes were applied, and then having drifted further to Mr Kearney's left. Her Honour reviewed and stated the effect of all significant aspects of Mr Kearney's cross-examination, and of statements made by him which were claimed to have been inconsistent with his evidence. 53 The Trial Judge's review of Mr Fuller's evidence showed to these effects. Mr Fuller was driving the Toyota utility, which was in good condition, downhill in second gear; the road surface was rutted and loose. He braked when arriving at a bend which was reasonably sharp; he approached the bend at about 25 km per hour but slowed to 20 km per hour. As he came out of the bend he saw a motorcycle about 30 m away. The Toyota was in the centre of what was effectively a one-lane track. He could not say where the motorcycle was on the road. The motorcycle was travelling faster than the Toyota. Mr Fuller braked immediately, skidded about 2 or 3 m and stopped within about one or two seconds prior to impact. When the Toyota stopped it was in the centre of the road with maybe one tyre to his left of the wheel tracks on the road. He said that the motorcycle came towards the Toyota skidding straight at it, turning sideways, and it then struck the bull bar between the driver's side and the centre of the Toyota. He said that there were 2 m of road space between the right side of his vehicle and the edge of the road, and there was 1.5 m of space to his left. The Trial Judge stated the effect of significant cross-examination of Mr Fuller, which included an admission that he had not been expecting to encounter another vehicle, denial that he had been driving too fast and denial that the Toyota was on the wrong side of the road. 54 The Trial Judge also reviewed the evidence of Mr Child, a passenger in the front seat of Mr Fuller's vehicle, who said that just prior to the impact the Toyota was very close to the centre of the track and that its wheels would be in the wheel tracks. 55 The Trial Judge also reviewed the evidence of Police Constable Brown, who attended at what was thought to be the scene of the collision, in the presence of Mr Fuller but after Mr Kearney had been taken to hospital; when Constable Brown attended it was totally dark and he made no useful observations; except that at the point of impact the maximum road width was a little over 2 m, not wide enough for two cars to pass comfortably; and that the vegetation was very thick. He observed skid marks but was unable to form any opinion about what they meant, or whether they were related to the collision. The Trial Judge also reviewed expert evidence tendered by both parties which the Trial Judge treated as ultimately inconclusive. 56 After a lengthy review of the evidence the Trial Judge expressed her findings and decision on liability in these terms (Red 66-69): Analysing the evidence that I have summarised, I make the following findings. It is not possible to rely upon the photographs. They were challenged by Mr Kearney. Both the defendant and Mr Child were uncertain as to whether they were in fact photographs of the site of the accident. Constable Brown who took measurements gave the width of the road as considerably less than that propounded by the defendant. As to Mr Kearney's initial statements that the accident was the result of road conditions, they are in some respects correct. The road conditions were such that ordinary everyday activity of two vehicles travelling in opposite directions meeting and passing could not be achieved at the site of this accident unless each driver took action to make way for the other. Ultimately however, Mr Kearney's views on responsibility for this accident are not determinative of that issue. I have formed the opinion that Mr Kearney has probably undertaken a process of reconstruction in which he has placed the Toyota further to Mr Kearney's left side of the road than was the fact. However, it is also apparent from the evidence of the defendant and Mr Child that the Toyota was not as far to their left hand side of the road as they originally stated and that was certainly not in the position shown in photographs 2.17 and 2.18 as stated in paragraph 3.3 of Mr Johnston's report. Their evidence was that the Toyota was in or close to the centre of the road. The road width according to Constable Brown was just over two metres wide with no space or road shoulder to the side of it. This is contrary to the evidence of the defendant and Mr Child that there was an area two metres wide to the right of the Toyota. Further there is evidence of the defendant that his brakes did in fact lock and that the Toyota skidded to a halt immediately prior to the impact. Thus I must conclude that at the time of the impact the Toyota was in or close to the centre of the road. The brakes of the Toyota had locked and the Toyota had skidded immediately prior to impact. This indicates that in all probability he was not in total control of the vehicle. The photographs in evidence do not depict the road at the site on the evidence. The photographs in evidence do not depict the position of the Toyota at the time of impact. The width of the road at the site of the accident was little more than two metres with little space to each side, thus if the two vehicles were to pass each other it was necessary that the defendant move the Toyota as close as possible to his left hand side of the road. This he did not do, despite his clear vision of the approaching motor cycle. In all probability he failed to do this because the brakes were locked and the vehicle was skidding. In failing to make way for Mr Kearney and his motor cycle, the defendant was in breach of his duty of care. Mr Kearney on approach appears to have proceeded on the assumption that the defendant would move to his left hand side of the road to allow him to pass. He did not sufficiently slow down or stop to allow for a more measured movement around the Toyota in the event that it remained as it did in the centre of the road. He was then left only with the choice of making a sharp move to the left at the same time as braking to slow his speed. On a dirt road the consequences were predictable. In this respect he was in breach of his duty of care and he contributed to the damage which he suffered in this motor vehicle accident. On this basis of my analysis of the evidence, I have apportioned responsibility equally between Mr Kearney and the defendant. 57 The Trial Judge's findings are not highly concrete with respect to matters of detail, and in my view this was appropriate in view of the nature of the information available. Sources of information which are sometimes quite useful in basing conclusions about motor accidents were not reliable here. The Trial Judge did not treat the evidence about observation of skid marks as a basis for conclusions, although there were a number of references to skid marks in the oral evidence; but Constable Brown was not able to make a useful observation. It was not possible to rely on the photographs in her Honour's view; reasonably enough, for reasons which she gave. Constable Brown's evidence has the advantages of his lack of involvement and his presumed objectivity, but the disadvantages of his having made his observations in the night time, in the absence of Mr Kearney and using torches and headlights and the difficulty which he encountered of interpreting marks on the road. However he did give measurements, which must have been based on what Mr Fuller told him was the site of the collision, and the Trial Judge took a reasonable course in acting on his evidence about the width of the road - that the width was just over 2 m wide. This accords, in a way, with Mr Kearney's evidence to the effect that the position of the Toyota left him nowhere to go but to collide with the Toyota. Her Honour's finding that two vehicles driving in opposite directions could not pass unless each driver took action to make way for the other was plainly correct, and was the basis of her Honour's analysis in which there was negligence on the part of each driver. 58 Although the Trial Judge referred to the evidence of Mr Fuller that the Toyota skidded to a halt immediately prior to the impact, she did not say that she accepted this and made no distinct finding about whether or not the Toyota was in motion at the time of collision. In the Trial Judge's analysis and in the respects in which negligence was found, it appears not to be of real importance whether the Toyota was or was not still in motion at the point of collision. The important matter is that if the vehicles were to pass there was a need for each of them to take action to make way for the other, and neither achieved this. There can have been little room for Mr Fuller to move his Toyota further to the left than he did, but there was some room; little as it was yet his vehicle after braking hard and skidding was still in the centre of the road at the point of collision. In the same way, there was little room for Mr Kearney to pass further to the left, but there was some room. The effect of the Trial Judge's findings was that neither did enough in this situation, difficult as it was, to avoid a collision by making space for the vehicles to pass. 59 It is notable that the Trial Judge's disposition does not attribute excessive speed to either driver. Each driver was affected by conditions special to him. No evidence suggests that Mr Fuller faced Mr Kearney's difficulty of a drop off on his near side of the road. It is probable that, when observation became possible, Mr Kearney was travelling at a higher speed than Mr Fuller. The road consisted of little more than one pair of wheel tracks, passing another vehicle required careful negotiation by both drivers, and the attribution by her Honour of equal responsibility to both appears to me to be a reasonable and correct determination. 60 Counsel for the appellant made observations about a number of matters with which it was contended that the Trial Judge had not dealt adequately. These included the point where the collision occurred. In the circumstances and in the nature of the evidence, precision was not available, and I do not see its absence as of any real importance. It was contended that the Trial Judge had not adequately considered Mr Fuller's case, in which it contended that he had moved to the left when he braked hard; that he then locked up and skidded. Although the Trial Judge did not in her summary of evidence refer to a written statement which Mr Fuller made to Constable Brown, which was generally confirmatory of his oral evidence, I do not think that the Trial Judge showed any lack of advertence to any significant part of Mr Fuller's narration. Several other aspects of the collision, which it was said that the Trial Judge had not dealt with, appear to me not to have been of real importance, in relation to the Trial Judge's view of the respect in which there was negligence. The sources in evidence of precision in fact-finding were few. 61 In my opinion Mr Fuller's challenges to the Trial Judge's disposition on liability do not succeed, and the Court of Appeal should order: Appeal dismissed with costs.

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