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McWilliam AsJ:

1. Mr Branden Ivanoff, the plaintiff, has brought a claim in negligence alleging that he suffered injury in the course of his employment. On 25 November 2018, Mr Ivanoff was working at a construction site in Gungahlin. He alleges he was walking down the stairwell which was part of a scaffolding system. There was some uneven scaffolding which was obscured and which caused him to roll his left ankle after he stepped on the unevenly erected scaffolding. As a result, he suffered injury, in the form of an osteochondral talar dome fracture, fracture of the distal fibular and three full width torn lateral ligaments.

2. He has brought a claim against:

(a) Alto Scaffolding Pty Ltd (ABN 84 607 427 243), the company said to be responsible for establishing the scaffolding at the worksite (first defendant).

(b) Core Building Group Pty Ltd (ABN 52 155 228 836), who was said to be the head contractor at the site (second defendant).

(c) RAR Rigging Pty Ltd (ABN 19 140 993 700) as his employer at the time, (third defendant).

(d) RAR Cranes Pty Ltd (ABN 89 140 993 684) (fourth defendant) an associated entity of the third defendant, and the company who is alleged to have held the subcontract with the second defendant. The fourth defendant is said to have utilised the services of employees of the third defendant to complete the work set out in the subcontract held by it.

3. The essence of the claim against each of the defendants is the failure to provide and maintain a safe system of work, with corresponding breaches of the Work Health and Safety Act 2011 (ACT).

The present interlocutory application

4. The application in proceeding presently before the Court concerns only the plaintiff and the third defendant. Filed on 19 April 2022, it seeks an order pursuant to r 1521 of the Court Procedures Rules 2006 (ACT) (Rules) for the separate determination of an issue separately from the substantive personal injury proceedings brought by the plaintiff. The plaintiff opposes the orders sought by the third defendant.

5. The separate question is what was described as the “state of connection” question, namely whether the substantive law of the ACT or NSW applies to the proceedings for the purpose of s 182D of the Workers Compensation Act 1951 (ACT) (WC Act). That section provides that:

[t]he substantive law of the Territory or State of connection governs – (a) whether or not a damages claim can be made in relation to a work-related injury to a worker; and (b) if a damages claim can be made – the determination of the damages claim.

6. Under s 36B of the WC Act, compensation is only payable under the WC Act if the ACT is the Territory or State of connection. The plaintiff in both his original and Amended Statement of Claim alleges that as a fact. The third defendant wishes to argue that the State of connection is NSW, and seeks to have that question determined ahead of the substantive hearing.

7. Whether the state of connection is the ACT or NSW has consequences for threshold questions concerning the injury itself (whole person impairment thresholds apply in the NSW jurisdiction but not the ACT jurisdiction), the procedural steps required to prepare the matter for hearing, and the relevant workers compensation insurer who may be liable for any judgment entered against the third defendant.

8. The evidence before the Court gave some indication of how the uncertainty arises in this case. Although the work site where the plaintiff was injured lies in the ACT, the registered office and principal place of business of the third defendant is in Queanbeyan, NSW. The third defendant’s director deposes to his belief that during the course of the plaintiff’s employment with the third defendant, the plaintiff started and finished each day of work at the office in Queanbeyan. His duties there included loading vehicles, cleaning, toolbox talks, and receiving work instructions.

9. The plaintiff has affirmed an affidavit which was read on the application. Among other things, he deposes to being based in Canberra and working at various worksites for two years from February 2017, almost entirely located within the ACT. He disagrees with the director of the third defendant, deposing to commencing his day either at the RAR Rigging premises or at the worksite that he was working on from time to time. His evidence was that there was no patter or habit as to any days on which he was required to attend the RAR Rigging premises in Queanbeyan.

The Court’s discretion to order separate hearing of a question

10. In making an application for a question in proceedings to be determined separately from another question under r 1521 of the Rules, the third defendant is seeking to depart from usual procedure. A party seeking such a departure must point to “some perceptible benefit”: Energy Australia v Australian Energy Ltd [2001] FCA 1049 at [5].

11. The Court is unlikely to make an order for the hearing of a separate question unless doing so will have the effect of resolving the controversies between the parties or substantially narrowing the field of litigious controversy on the basis of concrete facts (as opposed to hypotheticals): Bass v Permanent Trustee Co Ltd [1999] HCA 9; 198 CLR 334 at [45], [49]-[50]; Reading Australia Pty Ltd v Australian Mutual Provident Society [1999] FCA 718; 240 FCR 276 at [8]; Idoport v National Australia Bank [2000] NSWSC 1215 (Idoport) at [7].

12. To this end, the High Court has stated that the trial of single issues divorced from a case in its totality ought “only be embarked upon when their utility, economy, and fairness to the parties are beyond question”: Tepko Pty Ltd v Water Board [2001] HCA 19; 206 CLR 1 at [170].

13. The above principles were applied by Master Mossop (as his Honour then was) in Medici Clinics (Australia) Pty Ltd and Medici Clinics Pty Ltd v Patel [2014] ACTSC 29 (Medici Clinics). His Honour stated at [8]-[10] that while the Court plays an increasing role in taking measures to support the efficient and expeditious conduct of proceedings, the extent of this role was ultimately a matter of judgement and varies significantly depending upon the circumstances of the case.

14. Medici Clinics similarly involved an application under r 1521 where the determination of the separate question would potentially require cross examination of witnesses and findings of credit, would not dispose of the case, and would likely attract an appeal. That combination of factors led to his Honour dismissing the application, noting at [22] that the issues sought to be resolved separately would “in the long run, involve better use of resources of the parties and the court.” if determined together in the proceeding.

Competing arguments of the parties

15. The third defendant submitted that dealing with the state of connection question before the substantive trial would be just and convenient. The early disposal of that issue would bring “perceptible benefit” by resolving a discrete issue. While it was accepted there would be questions of credit involved, including limited cross-examination of the plaintiff, the third defendant argued that those questions would have no bearing on the substantive issues to be determined in the case.

16. The benefit perceived by the third defendant was that the resolution of the Territory or State of connection would:

(a) confirm whether the injury was to be dealt with according to the NSW or ACT workers’ compensation legislation and the applicable procedures in each jurisdiction;

(b) affect the nature of the evidence to be led in terms of whether it needed to be established (if the substantive law of NSW applied) that the plaintiff had suffered at least 15% whole body impairment from the defendants’ breach; and

(c) avoid the need to adjourn a final hearing if the state of connection issue was determined against the plaintiff and pleadings were then required to be amended to reflect that fact, with the procedural steps and evidence changing as a result.

17. There appears to also be commercial considerations behind the application, in that resolution of the issue would determine whether the current insurer for the third defendant is the appropriate insurer to respond, or whether it ought cease further involvement in proceedings. Presently the “NSW insurer” (so described by the third defendant) has accepted the plaintiff’s workers’ compensation claim and is making payments to the plaintiff. Yet the plaintiff’s claim as pleaded requires the ACT insurer to respond and to incur legal costs as a result.

18. The third defendant sought to distinguish the outcome in Medici Clinics on the basis that dealing with the state of connection issue would conclusively dispose of a question that would otherwise have to be dealt with at the outset of the trial. If the matter proceeded on the basis that the appropriate jurisdiction was the ACT and then the state of connection was determined to be NSW, the matter may then have to be adjourned part-heard because the particular procedural steps required should the matter have proceeded in NSW had not been followed. The third defendant argued that was not the most efficient outcome and would be a result contrary to s 5A of the Court Procedures Act 2004 (ACT) (CP Act).

19. The plaintiff opposed the orders sought on the basis that there was no good reason to depart from the usual procedural course in order to deal separately with the State of connection question. The plaintiff submitted there were three reasons telling against splitting the State of connection issue from the remainder of the dispute between the parties:

(a) The parties were unlikely to be able to proceed to a separate hearing on an agreed set of facts. Cross-examination of witnesses, including the plaintiff would be required, and questions of credit were involved in the facts that were required to be found.

(b) The determination of the issue separately would produce a separate right of appeal and therefore had the potential to protract the litigation, an outcome that would be contrary to s 5A of the CP Act.

(c) The Court of Appeal previously dealt with a similar situation in Moir v I.C. Formwork Services Pty Limited (No 2) [2020] ACTCA 44 (Moir). The issues for determination in those proceedings were very similar to those arising here, which (the plaintiff submitted) heightens the prospect of there not being a final determination of those issues on the hearing of the issue as a separate question.

20. The third defendant responded to the plaintiff’s concern about the prospects of a separate appeal by arguing that it ought not be given great weight, because the question of whether to appeal is a forensic decision and very much hypothetical. It may never eventuate. It was submitted that, given the high likelihood that the State of connection issue will lead to fragmentation of proceedings regardless of whether it is heard separately or with the other issues, the comparatively abstract and unknown possibility of an appeal ought not to tip the scales against ordering a separate hearing to determine the discrete issue of which substantive law applies.

Consideration

21. For the reasons that follow, and admittedly on fine balance, I do not consider that the perceived benefits warrant a departure from the usual course that all the issues to be finally determined between the parties be heard and determined together. I am not persuaded there should be a separate hearing of the State of connection question. The prejudice or vices that the third defendant is concerned about can be managed with the plaintiff being on notice that he will need to potentially address an alternative case and prepare accordingly before the hearing.

22. The matter of most significance is the lack of an agreed statement of facts on which the separate question would be determined. The existence of a factual contest is one difficulty, but more importantly, the resolution of that controversy is not something that can be done on documentary evidence alone or by witnesses who would not be called in the final hearing of the proceeding. It involves the plaintiff giving evidence and will depend in part upon whether that evidence is accepted.

23. The nature of the factual dispute emerging from the limited affidavit evidence on the application has been briefly described above. It is clear from that outline and the various statutory tests set out at Part 4.2A of the WC Act for establishing the State or Territory of connection that the plaintiff will need to explain what he did, where, and over what period – his duties, his work history and so forth. He may need to call corroborative witnesses on that issue. That evidence will be pitted against the third defendant’s witnesses and the Court will need to resolve that dispute, which may involve credit findings made about the plaintiff.

24. At a final hearing, the plaintiff will undoubtedly have to give evidence again, about the accident itself, his injury and its consequences. Some of the evidence may overlap, such as evidence concerning what the plaintiff did at the Gungahlin site leading up to the accident.

25. Although the subject matter of the evidence to be given by the plaintiff may be directed to a different point, I disagree with the third defendant as to whether the questions of credit will also be limited. Whether the plaintiff’s evidence on a point taken in advance of trial is accepted may depend on a variety of considerations, including demeanour, reliability of memory and overall plausibility. It cannot be said that those matters would not also potentially influence how a trial judge would assess the plaintiff’s evidence at a substantive final hearing. Where adverse findings of credit are made about one matter, the trial judge may be required to carefully assess what impact those findings have for other parts of a witness’ evidence.

26. Other considerations involve the plaintiff having to give evidence and be cross-examined twice, and potentially other witnesses having to do the same. There is also the possibility that any determination in respect of the State of connection issue on a final basis in advance of trial would be on a final basis by way of declaration: see Moir at [21]-[22]. The final determination of the issue would then give rise to a separate right of appeal.

27. The risk identified is the bifurcation of the appeal process, with not only additional expense to the parties in the prospect of two appeals, but the inefficient use of judicial resources. While I accept the third defendant’s submission that such a procedural course is not a given, if it were to eventuate, that would be a result that was contrary to procedural objectives under s 5A of the CP Act.

28. These kinds of concerns were all identified by Einstein J in Idoport as telling against the separate determination of an issue. His Honour stated at [7] (citations omitted):

… the separate determination of an issue will rarely be an appropriate procedure where: … (b) where there is a commonality of witnesses and issues of credit as between the separate issue and other issues in the case which will or may necessitate a ruling on the credit of one or more of the common witness, … (c) there is a possibility that the resolution of the separate issue will not finally determine the issue but will merely result in an appeal from that decision in relation to that separate issue, creating a multiplicity of proceedings, interruption to the court and undesirable fragmentation of the proceedings.

29. His Honour’s comments have been adopted and applied in a number of cases since, including in a list of principles collected by Hallen AsJ (as his Honour then was) in relation to the equivalent rule in NSW in Southwell v Bennett [2010] NSWSC 1372, relevantly stating at [15] (citations omitted):

…While it may appear attractive, superficially, to order the trial of a separate question, experience often shows that it will not be so, for example, because of the complications that can arise in relation to appeals, or to overlapping factual issues, or to questions of credit, if the same witnesses have to give evidence in relation to a question that is separated and those questions that are not.

30. The same list of principles (including the above extracted) was recently cited in Tom Folino-Gallo & Sone Investments v Zulian [2019] NSWSC 596at [24].

31. As to the countervailing consideration of the procedural efficiency that would flow from certainty about what jurisdiction the parties were operating under, that is a matter that can and should be managed by the plaintiff, in full understanding that the final hearing is not to be viewed as a two-part television miniseries. To the extent that evidence as to the nature and extent of the injury may need to overcome a statutory threshold if the case is determined a particular way, targeted questions of expert witnesses are able to take account of that potential outcome. However, these matters are best left to the parties to prepare their cases in full knowledge that the proceeding is being defended by the third defendant on an alternative basis to that put forward by the plaintiff.

32. It is appreciated that there will be commercial consequences as between the relevant insurers and the lack of certainty will potentially result in the unnecessary involvement of a separate insurer. Such uncertainty is not ideal, but the necessity to deal with alternative cases and outcomes is an inherent feature of litigation. The risk that an issue will resolve a particular way which then has significant consequences for a party is one of the reasons alternative dispute resolution measures (such as mediation) are attractive and frequently employed to settle claims.

33. The insurers concerned here are not the parties to proceedings. The interests of justice are directed resolving efficiently the dispute as between the parties, rather than those that fund the litigation. Such considerations cannot outweigh the procedural risks that weigh in favour of the issues being tried together.

Conclusion

34. For the above reasons, the order of the Court is as follows:

(1) The application is dismissed with costs.

I certify that the preceding thirty-four [34] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Associate Justice McWilliam ..................

Associate: Aislinn Grimley

Date: 29 June 2022