(vi) however, there was insufficient evidence to support a finding that upon the balance of probabilities, the plaintiff was actually exposed to the inhalation of asbestos between December 1986 and 1993. His Honour commented:
"If [the plaintiff] had cause to believe that one of the sources was asbestos it is improbable that he would not have noted that fact. Further, there is no evidence that these pipes and vessels dismantled overhead were lagged at all let alone with asbestos."
35 His Honour repeated his conclusion that there was no evidence of exposure after December 1986 and that any exposure after that date was "speculative" and found, on the evidence of Dr Zwi, that the "limited exposure at the Kelloggs factory in October and December 1986 was of the nature to which mesothelioma may be due".
36 Dr Zwi's evidence upon which his Honour relied was that:
"[The plaintiff] appears to have acknowledged that his exposure to asbestos at Kellogg's was restricted to three incidents, the total duration of which was measured in hours rather than days. If this is correct, the risk of developing mesothelioma as a result of this exposure would be minimal, though it cannot be entirely excluded.
… Based on Australian records it has been calculated that only 1.8% of cases of mesothelioma have a latent period less than ten years, after the first exposure to asbestos and only 2.8% of cases of mesothelioma have a latent period … less than ten years after a second exposure. In other words, the likelihood that [the plaintiff's] mesothelioma was due to exposure to asbestos at Kellogg's was small if it is regarded as the only exposure and very slightly larger if it is regarded as additional to the exposure from 1966 to 1969 at Torrens Island Power Station."
37 In his reasons for judgment, the trial judge approached the resolution of the issue before him, using the language of "actual exposure". That is not the test required by s 151AB(1)(a). What is required is that the worker be exposed to a risk of contracting the disease: see Alcan. Notwithstanding that we consider that the language of the trial judge is not consistent with the proper test as postulated in Alcan, we do not consider that his Honour has erred in his approach. On the facts relating to the exposure at the Kelloggs factory, it would be impossible, or virtually impossible, to prove that a person was exposed to the inhalation of asbestos. Rather, and we think this is what his Honour meant in his finding, the plaintiff was exposed to the risk of inhalation of asbestos on the two occasions in 1986 of which he gave evidence, but there was insufficient evidence to support a finding that he was exposed to the risk of inhalation of asbestos on any other occasion.
38 In our opinion this evidence was sufficient to support his Honour's finding that the appellant was the insurer on risk for the purposes of s 151AB. It was not necessary for the purposes of the section for it to be established that the exposure to asbestos in December 1986 was a cause of the plaintiff's mesothelioma. All that had to be established was that his employment at this time was, to use the words of Gleeson CJ in Alcan at 177:
"…engagement in a form of activity which exposed him to a risk of a disease of such a nature as to be contracted by a gradual process."
39 Although the risk may have been very low, it was still a risk. Accordingly, we have concluded that the appeal should be dismissed with costs.
The Cross-Appeal
40 Our conclusion on the appeal makes it unnecessary to deal with the issues raised by TGI's protective cross-claim. We should state however that his Honour's findings of fact do not support a finding that any of the other insurers were liable under s 151AB.
41 There remains for determination TGI's cross-appeal against the trial judge's rejection of its claim for indemnity costs of the cross-claim proceedings. It will be recalled that TGI was the insurer on risk for the period 1966-1969, being the period upon which his Honour fixed to determine ABB's liability to the plaintiff. The plaintiff's claim encompassed the period up until 1993, although it became apparent from his evidence at trial that the last occasion of exposure was December 1986.
42 TGI's claim for indemnity costs was based upon approaches it had made to ABB prior to the cross-claim proceedings that it be let out of those proceedings at an early stage on the basis that it would meet its own costs to that point. The approaches were contained in letters dated 12 and 14 August 1996. In its first letter it said:
"It seems to us that the Plaintiff's allegation will be that his exposure occurred until the date on which he discontinued employment with your client in 1993. As such, we consider that Section 151AB of the Workers Compensation Act 1987 (NSW) would operate to place responsibility to indemnify your client on the insurer then on risk, being MMI."
43 It repeated its claim in the second letter:
"Please note that our client relies upon the provisions of Section 151AB … which, in our view, clearly imposes responsibility to indemnify your client upon the insurer last on risk as at the date of an exposure to asbestos dusk and fibre. The Plaintiff alleges that his exposure extended for many years subsequent to the end of our client's relevant period of risk (that is in 1969). Indeed we understand that documents in your possession confirm exposure at least during a later period of employment during which GIO was on risk. As such, our client has formed the view that Section 151AB will operate as practically a total defence to your client's claim against our client.
However, our client is prepared to meet its own costs incurred to date in the event that your client is prepared to consent to a Judgment being entered in favour of our client forthwith."
44 The trial judge rejected the application for indemnity costs. After ordering the appellant to indemnify ABB in respect of damages and costs recovered by the plaintiff against ABB, and after ordering the appellant to pay "the costs of all parties upon the issue of insurance on a party-party basis", he said:
"TGI Australia Limited, whose costs are to be borne pursuant to the above order by GIO General Limited, seeks indemnity costs pursuant to a Calderbank letter directed to the solicitors for ABB on 14 August 1996 in which the solicitors for the cross-claimant were invited to consent to a judgment for that insurer.
The plaintiff when he gave evidence did resile significantly from portions of his evidence and he succeeds in the present claim upon significantly limited exposure.
In the circumstances when all later insurers denied, and one would have thought on instructions and for good cause, liability to indemnify, I do not regard the actions of the solicitors for ABB, in declining to accept the Calderbank offer as unreasonable. I decline to make such an order."
45 The point made on the cross-appeal was that as TGI had offered to compromise its claim at an early point on terms "more reasonable than were ultimately achieved" it was thus entitled to indemnity costs.
46 The decision of the trial judge on costs was a discretionary decision. No error of any of the kinds attracting appellate intervention against discretionary decisions was identified. Accordingly, this part of the cross-appeal should not be upheld.
47 As practically no additional time during the hearing of the appeal was spent on the cross-appeal, we consider there should be no order as to the costs of the cross-appeal.
48 The orders of the Court are: