Gunter v State Transit Authority of NSW [2004] NSWCA 330 | Case summary

Friday 17 September 2004 GUNTER v STATE TRANSIT AUTHORITY OF NSW Judgment 1 TOBIAS JA: I agree with Young CJ in Eq. 2 WOOD CJ at CL: I have read in draft form the judgment of Young CJ in Eq. I agree with the orders proposed, and with the reasons of his Honour. 3 YOUNG CJ in EQ: On 5 December 2003, her Honour Judge Balla heard a claim by Lorraine Gunter for damages for personal injury suffered when she was on 9 March 2000 standing on the footpath of George Street, Sydney, when she was hit by a temporary bus stop sign which had been struck by a bus. 4 The primary issue between the parties before her Honour was the applicability of the Motor Accidents Compensation Act 1999 referred to in these reasons as "the MAC Act". The significance of this issue was that if the MAC Act applied, then it was clear to everyone concerned that the damage suffered by the plaintiff was below the threshold for which any compensation could be awarded to her by the Court arising out of the accident. However, this was not so if the MAC Act did not apply. 5 Her Honour held that the MAC Act did apply to the facts and the plaintiff's claim was dismissed with costs. 6 The plaintiff sought leave to appeal and that application came before the Court as currently constituted on 26 August 2004 where it was heard concurrently with the argument of the appeal. The Court, at the end of the oral argument, granted leave to appeal on condition that a notice of appeal setting out the grounds was filed within seven days of 26 August and subject to that, the Court reserved its decision. 7 At the hearing on 26 August 2004, Mr Graham Segal of counsel appeared for the claimant, Mr Geoffrey M Watson SC and Mr J C Sheller appeared for the opponent. 8 The accident happened in much the same way as I have briefly described. The claimant was standing near a temporary bus stop sign which was placed close to the kerb in George Street, Sydney. A bus operated by the opponent struck the bus stop with its protruding side mirror, the bus stop then fell upon the claimant injuring her. 9 The claimant's statement of claim was deliberately pleaded so as to make no allegation at all as to the negligent driving or operation of the bus. The plaintiff sued in negligence, but she said the negligence was that the opponent had placed the sign at the edge of the footpath immediately adjacent to the roadway and that was negligent because it was foreseeable that it would be struck by a vehicle and might injure a person such as the plaintiff and not only that, there was a failure to warn the plaintiff of the dangers that the placing of the bus stop in that position represented. 10 The opponent's pleadings denied any negligence. However, this must be read as denying any negligence as alleged by the claimant because the line taken by the opponent's counsel in the District Court and before us clearly was that the accident happened as a result of the negligence of the operation of the bus. 11 With this background, I must turn to the legislation. The definition of "injury" in the MAC Act, s 3, is: " injury: (a) means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle … ".

The same section defines "motor accident": " motor accident means an accident or incident caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle which causes the death of or injury to a person." 12 Section 123 of the MAC Act prescribes that "A court cannot award damages to a person in respect of a motor accident contrary to this Chapter." The way the Chapter operates is to deny any compensation at all to this claimant if her claim is in respect of a motor accident. 13 Mr Segal commenced his submissions with reference to s 5 of the MAC Act, the section dealing with the objects of the Act. He honed in on section 5(1)(d) that an object of the Act was to keep premiums affordable recognising that third-party bodily insurance is compulsory which is followed by objects (e) and (f) to similar effect. 14 However, one needs to start with object 1(a) and 1(b). 15 The accepted method of approaching list of objects is to ascertain whether the list of objects is independent in the sense that each object as stated has the same primacy or to consider whether there are main objects and subsidiary objects. Generally speaking, the preferred method is to find the main objects and to treat the others as subsidiary; see Re German Date Coffee Company (1882) 20 Ch D 169; HA Stephenson & Son Ltd v Gillanders, Arbuthnot & Co (1931) 45 CLR 476, 485. 16 When one looks at the history of the legislation the fact that the Act has the main objects of providing a universal scheme to provide compensation for compensable injuries sustained in motor accidents to achieve optimum recovery for persons injured in motor accidents becomes abundantly clear. 17 If one starts with the Motor Vehicles (Third Party Insurance) Act 1942, one sees that a scheme was set up whereby all vehicles were to be insured under the Act with provisions that there would be a nominal defendant to represent uninsured or unidentified motor vehicles, the driver of each motor vehicle involved in a motor vehicle accident was deemed to be the agent of the owner who was the insured and the insurer could take over any claim for damages made against an owner. The Act did not define the injuries to which it applied and actions were commenced against the owner of the motor vehicle in the ordinary way. However, s 16 (the presumption of agency section) and s 20 (the section dealing with the duties of an owner and driver of a vehicle where there is an accident) and s 30 (dealing with claims against the Nominal Defendant) used the phrase "bodily injury to any person is caused by or arises out of the use of a motor vehicle". 18 The expression was given a very wide interpretation in cases decided under that Act; see eg Government Insurance Office of NSW v RJ Green & Lloyd Pty Ltd (1966) 114 CLR 437, 444 (Barwick CJ said that "In this field one should not be seeking subtleties but rather applying broad and practical conceptions"). 19 The problem of concurrent tortfeasors did not really arise because in so far as there was a decision of a court which said that the injury arose out of the use of a motor vehicle, the statutory fund paid the damages and in so far as it did not, a personal defendant paid. 20 However, problems could arise where the declaration claimed that the accident arose out of the use of a motor vehicle, but at the trial some different type of case was presented. These problems were considered by the Full Court and the High Court in Daley v Government Insurance Office of New South Wales (1957) 75 WN (NSW) 418 and 421. 21 The 1942 Act applied to accidents from its commencement until 30 June 1987. There was a short period of two years when an experimental system known as TransCover was in force, but the familiar system was restored as from 1 July 1989 under a slightly different scheme set out in the Motor Accidents Act 1988. The provisions of that statute for present purposes are much the same as the 1999 Act currently in force. 22 There are some differences between the scheme adopted in 1989 and the present Act as a result of the 1995 amendments. Originally in the 1988 Act "injury" was defined merely as meaning personal or bodily injury with some nominated instances. 23 Mr Segal drew our attention to the Second Reading Speech to the 1995 amendments. The Minister said in the Legislative Council (CTP of course in the following extract means compulsory third party): "The CTP policy and the motor accidents scheme simply are not, and were never intended to be, a comprehensive accident compensation scheme providing substantial damages in all cases of injuries connected in some way to the use of a motor vehicle. Common sense and community expectations generally demand that the CTP policy provide coverage in respect of injuries which arise from crashes and collisions on the roads or from vehicles running out of control. Over the years the courts have interpreted the CTP policy as providing for a wide range of injuries often unrelated to motor accidents. For example, the CTP policy has been held to cover injuries sustained during the loading and unloading of vehicles, and injuries sustained while standing on the back of a stationary trailer, and injuries involved in the use of a firearm in a vehicle. "It is therefore proposed to amend the definition of 'injury' to adopt an approach similar to that taken in Queensland, South Australia and Western Australia, where 'injury' is qualified in terms of its cause." 24 The effect of the change in the legislative scheme is that there are now what might be described as compartments of cases which are governed by their exclusive rules including provisions as to agency, thresholds, caps on damages etc. One compartment is those injuries covered by the Motor Accidents Compensation Act 1999 which in accordance with s 123 of that Act, must be dealt with under that Act and not otherwise. Another compartment are matters arising under the Workers' Compensation legislation. Apart from this there is the "ordinary" rights of action in tort where neither of those legislative schemes cover the injury. 25 What has not been directly addressed by the legislation is where there are two or more causes of the injury. 26 The word "fault" in the relevant definitions is defined in the Act merely as "negligence or any other tort" which does not take the matter very much further. It not infrequently occurs that a person's injury comes about through more than one cause. The classic illustration is, of course, The Koursk [1924] P 140, where the ship "Itria" was sunk as a result of two separate and distinct acts of negligence, one from the "Koursk" and the other from the "Clan Chisholm". 27 However, the rule in tort is that a plaintiff only has to show that the defendant was a cause, not the cause, of the accident so that a plaintiff can sue any tortfeasor, obtain a verdict for the whole of his or her damages and leave that tortfeasor to seek contribution from others; see eg Shorey v PT Limited (2003) 77 ALJR 1104, 1110. 28 It is against this background that Mr Segal submits that in the definition of "injury" one must remember that the definition requires the injury to be caused by the fault of the owner or driver of a motor vehicle, not "some fault" and the words "the fault" are to be contrasted with the words a little lower down in the definition "the injury is a result". That the word "a" before "result" has great semantic significance is clear; see Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2003) 57 NSWLR 321 at 324-5. 29 The two recent cases that need to be considered in connection with Mr Segal's submissions are the Allianz case to which I have just referred, and Emad Trolley Pty Ltd v Shigar (2003) 57 NSWLR 636. 30 In Allianz, a Mr Oliver was employed by GSF and directed to assist in unloading airline containers from the back of a truck. The mechanism for unloading the truck was defective and Mr Oliver was performing the unloading task manually. Mr Oliver suffered an injury to his lower back. The question was whether this was an injury within the MAC Act so that the third party insurer was liable, or whether some other insurer was liable. Mason P and Davies AJA (Santow JA dissenting), held that the injury was caused by the fault of the owner of a motor vehicle within the meaning of the MAC Act. Mason P said at 324 [12] that the defective motor vehicle was a cause of the compensable Injury. It was a result of the defective vehicle and it did not matter that it was also a result of negligence in the same person's instructions to its employee. Davies AJA said at 336 that one must apply the word "cause" in a commonsense way, not with over subtlety and that "caused" does not mean that the cause was the proximate cause or otherwise. 31 In Emad, the plaintiff was collecting trolleys from a supermarket car park. A tractor was propelling a trailer on which the collected trolleys were placed and the plaintiff was riding on the trailer and fell off. The pleadings of negligence focused on the failure to provide a safe system of work. The question was whether this was a motor accident within the meaning of the MAC Act. The leading judgment was given by McColl JA (Meagher and Hodgson JJA agreed with it). Her Honour comprehensively reviewed the cases and said at 651 [83]: "It is plain … that the respondent's injury was caused by the fault of the owner or driver of the motor vehicle in its use or operation. The fact that it was the claimant's system of work which put the respondent on the trolley truck/tractor from which he slipped, does not detract from the proposition that it was, at least, the owner's 'fault' which put the respondent in a position where, while the vehicle was being used or operated, he was susceptible to fall from it and be injured. That brings the circumstances of the respondent's injury and his action against the appellant within the meaning of the expression 'claim' in the Act … . "It matters not that the 'injury' may also be capable of being characterised as suffered as a breach of the appellant's duty of care as employer. Once it is capable of being characterised as an 'injury' within the Act, any 'claim' to recover damages in relation to it must be pursued in accordance with the legislative scheme." 32 Mr Segal sought to distinguish those cases. He said that they were not dealing with multiple cause situations, but rather classification between the one person in his or her role as employer and his or her role as operator of a vehicle. He put that it was quite absurd that if there was only a 5% effective cause of an accident by the negligence of a motor vehicle driver and 95% caused by a third party, that the MAC Act should apply and limit the plaintiff's damages. Thus, if, for instance, if I may take an example used by Britts in his book on Motor Accident Law (Law Book Company, Sydney, 1994), a plaintiff sues for damages caused where a car ran off the road because the driver was blinded by thick smoke coming from a council burn off at the side of the road, whilst the primary cause of the accident was the council's fire, the claim would be a motor vehicle claim under the MAC Act. 33 There will always be problems when one has compartmentalised schemes of cases at the interface. However, the scheme of the motor vehicles third party system and the way it has been interpreted over the last 50 years has been to give the Act wide scope and to apply "cause" in a commonsense way. If an injury falls within the MAC Act then the MAC Act applies even though there may be some situations where the reasonable person on the Bondi bus may think a bizarre result was achieved. In part this approach has been taken to ensure that the intention of the legislature is carried out that there should be a solvent fund available to a wide range of claimant to compensate them as victims of motor vehicle accidents where there has been fault in the use or operation of the vehicle. 34 Mr Segal puts that the objects of the Act to limit insurance premiums show that there has now been a departure from the original scheme and that the legislature now wishes to exclude people as claimants of the fund where the cause of the accident is only incidentally related to the use of a motor vehicle. Cases such as Allianz and Emad tend to show that that is not correct and that the preferable approach is still to cover a wide net of cases under the MAC Act. 35 Mr Watson for the respondent, in his submissions, noted a number of other factors as to why the preferable course is to allow a wide range of cases where a cause of the injury is a motor accident to be dealt with under the MAC Act. He said: "There are many cases which otherwise might fall outside circumstances where the tortfeasor was insured. He might be a man of straw. In other words, for certain cases where the motor accident element is only a component and may be even a relatively minor component, our society in New South Wales at least has guaranteed that an insurer will stand behind the tortfeasor … . That's a beneficial scheme. That is a price to pay on the part of potential claimants and that is that their remedy, the damages to which they are entitled, may be less because they're quantified in accordance with a scheme." 36 Mr Watson went on to say: "The Motor Accidents Compensation Act should be, in its broad embrace, regarded as beneficial. If the construction is given to it as proposed by my learned friend, one would see a number of cases where … motor accident compulsory third party insurers would be declining indemnity on the basis that the accident happened due to some other cause and the potential is there for endless debates." 37 There is great force in this submission, particularly in view of one of the principal objects of the MAC Act that motor accident claims be resolved at the earliest practicable stage. 38 I would thus adopt what Mr Watson has said for reinforcing the view that under the MAC Act the present case fell within it. 39 Accordingly, in my view the learned Judge came to the correct result and the appeal should be dismissed with costs.

Gunter v State Transit Authority of NSW

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