Plaintiff v Defendant [2012] VSC 412 | Case summary

Supreme Court of Victoria|2012-09-12|Before: BEACH J

ACCIDENT COMPENSATION - Workers compensation - Indemnity - Whether injury was caused under circumstances creating a liability in the defendant to pay damages - Factor X - Extent, expressed as a percentage, whereby defendant's act, default or negligence caused or contributed to worker's injury - Whether amounts of compensation paid or payable under the Accident Compensation Act 1985 - Whether accident was a journey accident - Whether injury arose out of or in the course of employment - Wrongs Act 1958, ss 14A, 14B, , , , , and - , , (1), , , , , and - ,

1 At approximately 7.30am on 16 October 2002, Ms Michelle Williams slipped on water and fell on the floor of the foyer in the building where she worked (589 Collins Street, Melbourne[1]). As a result of the accident, Ms Williams suffered serious injuries, including injuries to her cervical and lumbar spines. Following the accident, Ms Williams made a claim under the provisions of the Accident Compensation Act 1985 ("the Act"). To date, amounts have been paid in respect of that claim totalling $539,164.35.

2 In this proceeding, the plaintiff, the Victorian WorkCover Authority, seeks an indemnity pursuant to s 138 of the Act, in respect of the payments of compensation made in relation to Ms Williams' injuries. The indemnity is sought from the defendant, Jones Lang Lasalle (Vic) Pty Ltd. The VWA contends that the defendant was responsible for the provision of building management services at the time of the accident, and that the defendant's negligence was a cause of Ms Williams' injuries.

3 Section 138 of the Accident Compensation Act has been amended on a number of occasions since the accident. The parties are agreed that the version that applies to this proceeding is the current version.[2]

4 The relevant sub-sections of s 138 applicable to this claim are sub-ss (1) to (4). Those sub-sections provide:

"(1) Where an injury or a death for which compensation has been paid, or is or may be payable, by the Authority, a self-insurer or an employer was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria or that would, but for section 134A, create such a liability in respect of the injury or death, the Authority, self-insurer or employer is entitled to be indemnified by the third party in accordance with this section.

(2) In determining for the purposes of subsection (1) whether an injury or death was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria in respect of the injury or death, Divisions 8A and 9 of Part IV must not be taken into account.

(3) The amount which a third party is required to pay as indemnity under subsection (1) is the lesser of-

(a) the amount of compensation paid or payable under this Act in respect of the injury or death; and

(b) the amount calculated, were it not for the provisions of this Act, the Transport Accident Act 1986 and Parts VB, VBA and X of the Wrongs Act 1958, in accordance with the formula-

[A - (B + C)] x

where-

X is the extent, expressed as a percentage, whereby the third party's act, default or negligence caused or contributed to the injury or death;

A is the amount of damages (disregarding the extent, if any, whereby any other person's act, default or negligence caused or contributed to the injury or death) for pecuniary loss and non pecuniary loss which the third party is or would have been liable to pay in respect of the injury or death;

B is the amount recovered or recoverable by the Authority, the self-insurer or the employer under section 137 from the Transport Accident Commission (otherwise than under a settlement);

C is the amount paid by the third party in respect of the injury or death to the worker or the dependants of the worker under any settlement of, or judgment in, an action by the worker or dependants of the worker against the third party.

(4) Judgment against or settlement by a third party in an action by a worker, or dependants of a worker, in respect of an injury or death referred to in subsection (1) does not eliminate or diminish the right of indemnity given by this section, except to the extent provided in this section."

5 In its statement of claim, the VWA pleads an entitlement to relief based upon an allegation that the defendant breached a duty of care it owed Ms Williams and an alternative allegation that the defendant breached a statutory duty said to be owed pursuant to Part IIA of the Wrongs Act 1958. However, in opening the VWA's case, Senior Counsel for the VWA conceded (correctly) that Part IIA of the Wrongs Act does not create a statutory duty the breach of which sounds in damages at the suit of an injured person. Part IIA redefines the common law duty owed by an occupier of premises, setting out matters to be taken into account in determining the scope of the duty and whether the duty has or has not been discharged in a particular case.[3]

6 The parties have agreed Factor A at $1,150,000. Additionally, Factor C is agreed in the sum of $130,000. Factor B is zero and, as I have said above, the amount of compensation paid to date in respect of Ms Williams' claim is $539,164.35.

7 The issues may be briefly stated as follows. The VWA contends that the defendant was negligent and that this negligence was a cause of Ms Williams' injuries. In such circumstances, it says that the only issue remaining is the proper quantification of Factor X. On the other hand, the defendant denies that it was negligent and denies that any negligence that might be found was causative of Ms Williams' injuries. In such circumstances, its says that the VWA's claim must fail. However, the defendant contends that there is a second basis upon which the VWA's claim must fail. It says that compensation was not properly payable under the Act to Ms Williams, and in such circumstances, the VWA is not entitled to be indemnified in any sum. The VWA contests this issue, saying that compensation was properly payable (and paid) under the Act and that, in any event, even if there was a basis for saying that compensation should not have been paid, this does not disentitle it from an indemnity under s 138.

8 I will deal first with the question of whether there was negligence on the part of the defendant which was causative of Ms Williams' injuries. In doing so, it is first necessary to examine the position and any relevant obligations owed by the defendant.

9 Essentially, at the time of the accident, 589 Collins Street was leased and occupied by various emanations of the State of Victoria. The areas leased consisted of parts of the ground floor and levels 1 to 17 of the building. Under the relevant lease, the lessee had obligations in respect of the cleaning of the premises.

10 At the time of the accident, the defendant provided property management services pursuant to a contract with the State of Victoria ("the service provider agreement"). The service provider agreement covered 589 Collins Street. The defendant became the service provider under the service provider agreement in the middle of 2002. For some months before this time, property management services had been provided by Global Property Services, a joint venture company of the defendant and Spotless.

11 Clause 11.1 of the service provider agreement is in the following terms:

"(a) JLL [the defendant] must at all times maintain and allocate sufficient resources to fully discharge all its obligations under this Agreement including adequate skilled staff, tools, working capital, communications facilities and administrative support.

(b) Anything JLL is required to perform in respect of the Services or otherwise to do under this Agreement must be done at JLL's cost unless specifically stated otherwise."[4]

12 In clause 26.1 of the service provider agreement it is stated:

"JLL [the defendant] must, without limiting the other obligations of JLL under this clause:

(a) manage and coordinate all aspects of the performance of the Managed Services;

(b) monitor the performance of the Managed Services;

(c) convene, chair and keep minutes of meetings with the providers of Managed Services and obtain information of the Managed Services (sic). The VGPG [Victorian Government Property Group] Representative may attend any meeting convened by JLL and examine any information supplied to JLL;

(d) ...

(e) must issue such directions to the providers of Managed Services as are reasonably necessary so that they properly carry out their obligations under the contracts for Managed Services;

..."[5]

13 Clause 3.1.3 of Schedule 3 of the service provider agreement stated:

"A number of contracts currently exist for the provision of certain of the Property Management Services. Service Provider [the defendant] is responsible for managing these services until expiry, at which time they may be replaced by contracts let and managed by the Service Provider."

14 In clause 3.2.1 of Schedule 3, the service provider agreement stated:

"The Service Provider is required to undertake day to day Facilities Management in a manner that ensures maximum attention to maintaining the uninterrupted operation of the sites. The control, induction and supervision of Sub-contractors is of utmost importance in managing the risk associated with Facilities Management and is the responsibility of the Service Provider."

15 Many of the expressions used in the service provider agreement are defined in that agreement.[6] However, for present purposes it is not necessary to set out all of these definitions. Clause 3.2.1.1, 3.2.1.2 and 3.2.1.3 of Schedule 3 describe "Facilities Management" that is to be provided, which includes "environmental services, including building and tenancy cleaning and grounds maintenance". The task of cleaning and related matters is more fully described in a table in clause 3.2.1.8 of Schedule 3 of the service provider agreement.

16 Help desk management services required to be provided by the defendant are described in clause 3.2.4.2 of Schedule 3 as requiring "operational management of the Help Desk by the Service Provider". Operational management is stated to include "all day to day functions in receiving, processing and resolution of Property Service Requests and Warranty Requests". A helpful flow chart of the service process overview is then set out under clause 3.2.4.2.

17 In a memorandum headed "Property/Facilities Management Role at 589 Collins Street", it is stated that "[b]roadly, the activities of the Facilities Manager include ... management of cleaning and other facilities contracts/contractors".

18 In summary in the months prior to the accident and at the time of the accident, the defendant was contractually bound to manage and supervise, amongst others, the cleaners and the cleaning services performed at 589 Collins Street. While the contracts pursuant to which cleaning was performed at 589 Collins Street in 2002 were not tendered in evidence, it would appear from the evidence that there was no contract between the defendant and the relevant cleaners or cleaning company. On the material, it seems to be as likely as not that any contract to which the cleaners were a party was an existing contract of the kind referred to in clause 3.1.3 of Schedule 3 when the defendant commenced providing property management services in respect of 589 Collins Street.[7]

19 The accident occurred at approximately 7.30am on 16 October 2002. Ms Williams was walking through the ground floor foyer of 589 Collins Street, on the way to her work area on the third floor of that building. She gave evidence that there were probably at least 15 people in the foyer at about that time. While her official work hours were from 8.15am to 4.02pm, she gave evidence that she worked flexi time and that if the accident had not happened, she would have taken the lift to the third floor and started work immediately.

20 Ms Williams did not observe the water on the floor until after the accident. She said that after the accident, she saw drops of water leading back out to the front door or main door of the building, a skid mark made by her and some drops of water leading to a door near the lifts. She said the drops of water (including the drop of water she slipped on) were each the size of a ten cent piece. She also said that the drops were probably six inches apart, and that there were some parts that had already been walked on "out through the main front doors".

21 Ms Williams also gave evidence that there was a cleaner with cleaning equipment out on the front entrance (Collins Street). This cleaner was outside hosing down the building.

22 The internal door to which the other end of the line of drops led was a door Ms Williams had seen cleaning staff using on previous occasions. The VWA contended that the cleaners were responsible for the drops of water. The defendant did not dispute this proposition, or the proposition that, in spilling water and/or causing drops of water to lie on the floor of the foyer, the cleaners were negligent.

23 In addition to Ms Williams, the VWA called Mr Keith Ferguson and Mr Christopher Eagleton.

24 Prior to July 2002, Mr Ferguson was employed by Global Properties Solutions. He gave evidence that this was a private company jointly owned by the defendant and Spotless. He described Global Property Solutions as "the outsourced service provider to the Department of Treasury and Finance, who previously managed office accommodation on behalf of the State Government of Victoria". He described the functions Global Property Solutions performed at 589 Collins Street as "tenant representation". He said that one of its principal duties "was to attend to requests for services, property accommodation services from the occupants in that building, and liaise with the building owner on matters that might have arisen under the lease".

25 Mr Ferguson was asked whether Global Property Solutions had any function in relation to supervision of the various maintenance contracts in the building. He said:

"I can't remember the details of it, but if there were contracts in place that GPS was expected to manage, for argument's sake there would be cleaning contracts. I'm almost certain in my own mind, from memory, that the maintenance, cleaning was a responsibility of Global to ensure that the cleaners were performing their duties."

26 Mr Ferguson described the employment of Mr Andrew Oldenhuis, whose duties consisted of "monitor[ing] the performance of service providers under any contractual arrangements and ensur[ing] that they performed it in accordance with the scope of the services they were contracted to provide".

27 In cross-examination, Mr Ferguson was asked and answered the following questions:

"In your role as manager of those external contracts, if you had significant concerns about the performance even of an existing contractor, not a contractor you appointed, you would take steps to advise the owner and possibly attempt to terminate that contract and replace it, would that be correct?---Yes, yes.

In this case you know of no problem with the cleaner that led you to either terminate that contract or to advise the owner to terminate that contract?---I can't recollect any issue."

28 The second witness, Mr Eagleton gave evidence that in the spring of 2002 he worked for the defendant. His job was "facility management", which involved working with the Government tenants "to look after their business services, their fit-outs, their projects, and also to work getting the building onto [the defendant's] help desk system which was an automated work logging request system".

29 Asked whether he ever held regular meetings with any of the cleaners, he said, "I used to see them on a regular basis". Asked whether he ever inquired about job safety analyses they might have conducted, he said, "No, I don't recall". He was asked and answered the following questions:

"Did you have regular scheduled meetings with them to scope out how they performed their work at all?---Not regular meetings. Often they would hop into the office and I would comment if a tenant had passed comment to me. Something may have been missed or if there was a job raised that they hadn't attended to, then I would certainly raise it with them.

What time did you commence your work at the premises?---Varied, 8.30, 9.00 o'clock. I might have a meeting at another building which would go until lunch time.

Were you ever there as early as 7.00 or 7.30?---No.

Did you have any means of knowing just what the cleaners would be doing at say 7.30 in the morning?---No."

30 In cross-examination, Mr Eagleton was asked and answered the following questions:

"Do you know or do you have any recollection of any report of spillage of water, particularly in the foyer area downstairs?---No.

Do you recall ever having any significant problems with spillage of water or any unsatisfactory performance like that by the cleaners?---Not to the best of my memory, no.

...

Other than this incident, do you recall ever receiving any report or complaint of water being spilled in the foyer of the building?---I can't recall."

31 Records described as "VGPG Work Orders Spreadsheets" were tendered in evidence for the period from 2 July 2002 to 30 October 2002. These records show hundreds of different matters being reported during this period. The defendant asserted that none of them disclose any problem with water being spilt on the floor of the foyer or any problem concerning the cleaners spilling or leaving water on a floor surface. Counsel for the VWA were content not to dispute this proposition, and in the result, no side took me to the detail of any of these records.

32 In its written submissions,[8] the VWA put the case in negligence against the defendant in the following terms:

28. It is the Plaintiff's submission that the Defendant has been negligent. The lessee was contractually bound to clean all areas including that where the injury occurred (CB65). That obligation passed to the Defendant. We refer to Clause 26.1 at (CB32). The phrase 'managed services' is defined at (CB21 W). No Minutes of Meeting as envisaged have been discovered.
29. The Defendant was required to allocate sufficient resources to fully discharge its obligations under the agreement including adequate skilled staff and administrative support (see Clause 11.1 at CB21 JJ).
30. The Plaintiff submits that there is no evidence that the Defendant issued the direction to the providers of managed services envisaged by Clause 26.1(e) (CB21 XX).
31. The Plaintiff refers to facilities managed services delineated in the service specification at (CB310) noting that the supervision of sub-contractors is of utmost importance in managing the risk associated with facilities management. This conforms with the memorandum from the Defendant appearing at (CB21 XXX) obliging the Defendant to manage the cleaning contractors.
32. Mr Eagleton apparently had no system for regular monitoring of the activities of the cleaners. He would have ad hoc communication with them. He conceded that he did not know at what time they conducted their cleaning activities in the morning.
33. Mr Ferguson's evidence was to the effect that the Facilities Manager should in fact supervise the cleaning contractors as is envisaged by the SPA.
34. It is the Plaintiff's submission that the Defendant should have maintained regular supervision over the behaviour of the cleaning contractors and should have ensured that the cleaning of the front of the building with water did not occur when the entrance and foyer were being used by the public. Common sense demands that at the least there be warning signs and areas roped off etc. Had the Defendant ensured that the cleaners were following safe work practices then the water would not have been on the floor and the injury would not have occurred."

33 It was no part of the VWA's claim to say that the defendant was negligent in failing to detect water on the floor of the premises at 7.30am on 16 October 2002. In this regard, Senior Counsel for the VWA conceded that the relevant considerations identified by the High Court in Strong v Woolworths Limited,[9] precluded such a claim.[10]

Were the injuries caused under circumstances creating a liability in the defendant to pay damages?

34 Section 138(1) requires the VWA to establish that Ms Williams' injuries were "caused under circumstances creating a liability in [the defendant] to pay damages". Section 138(2) provides that in determining this issue, Divisions 8A and 9 of Part IV of the Act must not be taken into account.

35 An issue arises as to whether Part X of the Wrongs Act 1958 must be taken into account in determining whether Ms Williams' injuries were caused under circumstances creating a liability in the defendant to pay damages. In Alcoa Portland Aluminium Pty Ltd v Victorian WorkCover Authority,[11] the Court of Appeal had to consider whether provisions in Part VB of the Wrongs Act applied to the calculation of Factor A in s 138(3). The Court upheld the trial judge's conclusion that the provisions in Part VB did have application in the calculation of Factor A.

36 Following the Court of Appeal's decision in Alcoa, s 138(3) was amended so as to provide for the calculation in s 138(3)(b) to be made without reference to Parts VB, VBA and X of the Wrongs Act. However, no corresponding amendment was made in sub-ss (1) or (2).[12]

37 The amendment made following Alcoa raises the possibility that in determining the liability of the defendant under sub-ss (1) and (2), relevant provisions of Part X of the Wrongs Act fall to be applied. However, when coming to calculate the amount in accordance with the formula in s 138(3)(b), those same provisions are to be disregarded. The rationality of such an approach is not easy to discern.[13] Notwithstanding that it is difficult to discern why Parliament would intend the provisions of Part X of the Wrongs Act not to be taken into account in the calculation of the formula, in circumstances where they might fall to be taken into account on the question of liability, to hold otherwise would do unacceptable violence to the language in sub-ss (1) and (2) of s 138. In my view, the reasoning in Alcoa,[14] and in particular paragraphs [16] to [26] compels such a construction. This is so notwithstanding the use of the expressions "to any claim for damages" and "claims for damages" in ss 44 and 45(1) on the one hand, and the expressions "to an award of personal injury damages" and "awards of damages" in ss 28C(1) and (2) on the other hand.[15] In any event, when I raised these matters with Senior Counsel for the VWA, he was content to accept that this was the way s 138 operated.[16]

38 Section 48 of the Wrongs Act provides:

"48. General principles

(1) A person is not negligent in failing to take precautions against a risk of harm unless-

(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known); and

(b) the risk was not insignificant; and

(c) in the circumstances, a reasonable person in the person's position would have taken those precautions.

(2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things)-

(a) the probability that the harm would occur if care were not taken;

(b) the likely seriousness of the harm;

(c) the burden of taking precautions to avoid the risk of harm;

(d) the social utility of the activity that creates the risk of harm.

(3) For the purposes of subsection (1)(b)-

(a) insignificant risks include, but are not limited to, risks that are far-fetched or fanciful; and

(b) risks that are not insignificant are all risks other than insignificant risks and include, but are not limited to, significant risks."

39 Taking the VWA's case at its highest, and assuming (as it alleges) that the defendant was an occupier within the meaning of Part IIA of the Wrongs Act, whether one applies part IIA and s 48 of the Wrongs Act, or the common law as modified by Part IIA, the VWA has not established negligence in this case on the part of the defendant. While it might be that the State of Victoria could establish some breach or breaches of the service provider agreement by the defendant in failing to convene, chair and keep minutes of meetings with cleaners, or in some other respect, the evidence in this case does not lead me to conclude that any such failure constituted a breach of any duty owed by the defendant to Ms Williams. There is no evidence to suggest that the defendant, in the exercise of reasonable care, needed to supervise the cleaners any more closely than it did as disclosed in the evidence. Specifically, there was no evidence of any prior problems or difficulties with the cleaners spilling or leaving water on floor surfaces in the building which might have created a requirement for greater supervision.

40 While the VWA made submissions that the exercise of reasonable care by the defendant would have seen them preventing the use of a hose outside the building at 7.30am, there is a paucity of any evidence that it was this hose that led to the ten cent size drops of water spaced six inches apart in the area where Ms Williams slipped. It can be accepted that the water on the floor in the vicinity of Ms Williams' accident was spilt or dripped by a cleaner or cleaners. However, whether this was caused by a leaky trolley, bucket or water bottle is mere speculation.

41 Further, the evidence as to the number of people in and around the foyer area at different times of the day does not permit of a conclusion that it was negligent to allow the cleaners to perform whatever work they were performing at 7.30am in the morning as distinct from some other time of day. Unless it was to be said that the exercise of reasonable care mandated the defendant only permitting the cleaners to do work which involved the use of water at times when the building was closed (a proposition which I do not in any event accept), this part of the VWA's claim cannot be made out.

42 That said, of greater difficulty for the VWA is the issue of causation.

43 Sections 51 and 52 of the Wrongs Act 1958 deal with the question of causation. These sections provide:

"51. General principles

(1) A determination that negligence caused particular harm comprises the following elements-

(a) that the negligence was a necessary condition of the occurrence of the harm (factual causation); and

(b) that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused (scope of liability).

(2) In determining in an appropriate case, in accordance with established principles, whether negligence that cannot be established as a necessary condition of the occurrence of harm should be taken to establish factual causation, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.

(3) If it is relevant to the determination of factual causation to determine what the person who suffered harm (the injured person) would have done if the negligent person had not been negligent, the matter is to be determined subjectively in the light of all relevant circumstances.

(4) For the purpose of determining the scope of liability, the court is to consider (amongst other relevant things) whether or not and why responsibility for the harm should be imposed on the negligent party.

52. Burden of proof

In determining liability for negligence, the plaintiff always bears the burden of proving, on the balance of probabilities, any fact relevant to the issue of causation."

44 On the construction of ss 138(1) and (2) of the Act that requires the relevant provisions of Part X of the Wrongs Act to be taken into account, s 51 is central to the question of causation, so far as liability is concerned.

45 In Adeels Palace Pty Ltd v Moubarak,[17] the High Court had to consider the operation of s 5D of the Civil Liability Act 2002 (NSW). Section 5D of the Civil Liability Act is the New South Wales equivalent of s 51 of the Wrongs Act.[18] The Court said:

"[42] Section 5D(1) of that Act divides the determination of whether negligence caused particular harm into two elements: factual causation and scope of liability.

[43] Dividing the issue of causation in this way expresses the relevant questions in a way that may differ from what was said by Mason CJ, in March v E & M H Stramare Pty Ltd,[19] to be the common law's approach to causation. The references[20] in March to causation being 'ultimately a matter of common sense' were evidently intended to disapprove the proposition 'that value judgment has, or should have, no part to play in resolving causation as an issue of fact'. By contrast, s 5D(1) treats factual causation and scope of liability as separate and distinct issues.

[44] It is not necessary to examine whether or to what extent the approach to causation described in March might lead to a conclusion about factual causation different from the conclusion that should be reached by applying s 5D(1). It is sufficient to observe that, in cases where the Civil Liability Act or equivalent statutes are engaged, it is the applicable statutory provision that must be applied.

[45] Next it is necessary to observe that the first of the two elements identified in s 5D(1) (factual causation) is determined by the 'but for' test: but for the negligent act or omission, would the harm have occurred?[21]

46 In Adeels Palace, the Court concluded that factual causation was not made out. While there was a discussion about the operation of s 5D(2), the Court was not called upon to consider the provisions in s 5D dealing with the scope of liability.

47 As the High Court held in Adeels Palace, factual causation (s 51(1)(a)) is determined by the "but for" test. The short point here is that even if the VWA could make out the breaches of duty it contends for against the defendant, one cannot conclude on the balance of probabilities that, but for these breaches (failures to supervise, have a system for regular monitoring or issue directions), the accident would not have happened. The lack of evidence as to the precise circumstances in which the drops of water came to be on the floor at 7.30am on 16 October 2002 tells against any conclusion that the taking of the steps contended for by the VWA would probably have prevented the accident from occurring. Put shortly, the evidence does not show that the additional steps or activities contended for by the VWA would have prevented Ms Williams from suffering her injuries.[22]

48 It follows that the VWA has failed to establish that Ms Williams' injuries were caused under circumstances creating a liability in the defendant to pay damages. Further, even if the test of causation in this case was the common law test, in my view, the VWA's claim would still fail. When one looks at the evidence in this case, it cannot be said as a matter of commonsense that the negligence of the defendant was a cause of Ms Williams' injuries. Even if there had been formal meetings or more supervision and control exercised by the defendant, the evidence does not permit of a finding that on the balance of probabilities this would have averted the happening of the accident (again, there being no evidence as to the circumstances in which the water came to be on the floor or any evidence of any previous similar occurrence or problem).

Is the VWA entitled to maintain this claim in any event?

50 The conclusions I have reached above are sufficient to dispose of this proceeding. However, the defendant contends that even if Ms Williams' injuries were caused under circumstances creating a liability in the defendant to pay damages, the VWA's claim must fail because the VWA was never liable to pay compensation under the Act. The defendant contends that the VWA had no obligation to pay compensation in respect of Ms Williams' injuries because Ms Williams was travelling to the place of her employment at the time she was injured, and was thus not covered by s 82 of the Act.

51 The VWA disputes this proposition, and says further that in any event the defendant "cannot go behind the payments of compensation". I will deal first with this contention.

52 The expressions "compensation" and "compensation paid ... under this Act"[23] are not defined in the Act. Any consideration of the question of whether a defendant may or may not have any liability under s 138, because compensation payments made in respect of a worker's injury were not required to be made pursuant to the provisions of the Act, must commence with an examination of s 20(1)(b) of the Act. Section 20(1)(b) provides: "The functions of the authority are to ... pay compensation to persons entitled to compensation under this Act". Section 20A(1) provides:

"Subject to this Act, the Authority has the power to do all things necessary or convenient to be done for or in connection with the performance of its functions[24] and to enable it to achieve its objectives.[25]"

53 Section 82 of the Act contains the provisions governing entitlement to compensation.[26] Section 82(1) provides:

"If there is caused to a worker an injury arising out of or in the course of any employment, the worker shall be entitled to compensation in accordance with this Act."

54 Section 114F deals with the recovery of payments to which a worker is not entitled. Section 114F(1) is in the following terms:

"The Authority or a self-insurer may recover from a worker, an employer or any other person any payment of compensation or other amount to which the worker, employer or other person is not entitled."

55 In its written submissions on why a defendant to a s 138 claim "cannot go behind the payments of compensation", the VWA contended:

"Section 138 is an indemnity provision. It is not uncommon that an indemnity provision denies the indemnifier a right to go behind the payments: see s 23B Wrongs Act, especially sub-section (4). Conformity in the application of indemnity provisions is desirable."

56 This submission must be rejected. First, s 23B of the Wrongs Act is the provision governing contribution between persons liable in respect of the same damage: it is not an indemnity provision of the kind found in s 138. Secondly, there is simply no basis for some "conformity" in the application of different statutory provisions giving rise to different entitlements in different circumstances. If anything, the presence of sub-s 23B(4) in the Wrongs Act tells against the VWA's submissions in that Parliament has not seen fit to enact such a provision in relation to the payments of compensation referred to in s 138 of the Act. Thirdly, there is, in any event, no uniformity or conformity of approach in relation to contribution provisions or provisions providing for the payment of an indemnity.[27]

57 The proper construction of the words "compensation paid ... under this Act" in s 138(3)(a) is not free from difficulty. In this case, the VWA contends that even if Ms Williams' accident was a journey accident for which compensation should not have been paid, compensation was in fact paid under the Act in the sense that it was not paid for any purpose other than because of the provisions of the Act. However, properly construed, "compensation paid ... under this Act" means compensation entitlements arising under and paid pursuant to the provisions of the Act. That is, the VWA cannot succeed in a claim for an indemnity under s 138 if the amounts paid in respect of which the claim is made were not amounts which were required by those provisions of the Act dealing with liability (or compensable circumstances) to be paid pursuant to the provisions of the Act.

58 Under ss 20 and 20A of the Act, the VWA only has power to pay compensation to persons entitled to compensation under the Act. It does not have power to pay compensation where there is no liability in accordance with the provisions of the Act. That is the sense in which the words "under this Act" are used. So in s 114F, the VWA is given power to recover "any payment of compensation or other amount to which [the relevant person was] not entitled". The reference in s 114F to "compensation" rather than "compensation under this Act" supports the proposition that s 138(3)(a) only permits the VWA to recover compensation payments for which there was a liability under the provisions of the Act.

59 Further, there is nothing in the provisions of the Act that suggests that the VWA might be entitled to make payments of compensation for which it was not liable and then to seek to recover those payments in an action under s 138 of the Act. Indeed, construing s 138 in its context, the provisions to which I have already made reference tell against any such construction of s 138 (for example, s 114F operating to permit the recovery of payments of, amongst other things, "compensation" that should not have been made).

60 My view as to the construction of the expression "compensation paid ... under this Act" is fortified by the decision of the Court of Appeal of the Supreme Court of the Northern Territory in Cleanthous v Nominal Insurer.[28] In Cleanthous, the Court had to consider the construction of s 17E of the Workmen's Compensation Act 1949 (NT). That section relevantly provided:

"Where the Nominal Insurer pays an amount under this Act in respect of a liability of an employer:

(a) ...

(b) the amount of the payment (...) is a debt payable by the employer to the nominal insurer, and may be sued for and recovered in a court of competent jurisdiction; and

(c) ..."

61 In that case, an amount was paid by the nominal insurer to an injured worker pursuant to an agreement. Nader J[29] said:[30]

"Therefore the agreement between the nominal insurer and the worker ... was ultra vires, and whatever its effect as between those privy to it (a question that does not call to be decided here), the payment made to the worker in reliance upon that agreement was not a payment of an amount under the Act. Therefore, it was not effective to create a debt from the employer to the nominal insurer under s 17E." (emphasis added)

62 The VWA's submission concerning the decision of Cleanthous was in the following terms:[31]

"[T]he plaintiff submits that the wording of s 17E of the Northern Territory legislation canvassed in ... Cleanthous ... is materially different to that employed by s 138 of the [Act] especially in its reference to a 'liability in the (sic, of an) employer' so that the decision is of no relevance to the present proceeding."

63 I reject this submission. Cleanthous concerns, amongst other things, the meaning to be given to the expression "pays an amount under this Act". That expression, as used in s 17E of the Northern Territory statute, is relevantly identical to the expression "compensation paid ... under this Act" in s 138(3)(a). The fact that s 17E contains the words "liability of an employer" is not material to the present question of construction.

64 In further support of its argument that in a s 138 recovery proceeding a defendant cannot go behind the payments of compensation, the VWA referred to the decisions of Bain v Frank G. O'Brien Limited,[32] Caterpillar of Australia Pty Ltd v Flett,[33] and Kurnell Passenger and Transport Service Pty Ltd v Randwick City Council.[34] None of these decisions are of assistance to the VWA. All three decisions concerned cases where awards of compensation had been made pursuant to provisions for the making of such awards under the workers compensation acts the subject of those proceedings. Critical to the decisions in Bain and Caterpillar of Australia Pty Ltd was the fact that a relevant award had been made, while the decision in Kurnell involved an application of the decision in Bain. In Caterpillar of Australia Pty Ltd, the award was an award of compensation made by the Workers Compensation Board. In Bain, the award was an award made by the Workers' Compensation Commission of NSW. In Kurnell, the award was made by the Compensation Court of NSW. There is no suggestion of any such relevant award having been made in the present case. These cases have no relevance to this proceeding.

65 In addition to Bain, Caterpillar of Australia Pty Ltd and Kurnell, the VWA also relied upon the Court of Appeal's decisions in Victorian WorkCover Authority v Kenman Kandy Pty Ltd[35] and DSG Pty Ltd v Victorian WorkCover Authority.[36] Neither of these cases is of assistance. To the contrary, in Kenman Kandy,[37] Batt and Vincent JJA noted that the pre-1993 form of s 138(1) operated where death of injury was caused in compensable circumstances and after some subsequent payment of compensation had been made. The amendments to s 138 of the Act since 1993 has not changed the operation of the section so far as injury or death being caused in compensable circumstances is concerned.

66 The DSG case is of no assistance to the VWA because it concerned a different point, namely whether, on its proper construction, a host employer could not be a third party within the meaning of s 138. While it may be accepted that s 138 "is designed to match the burden of payment with the legal liability in respect of a compensable injury",[38] this proposition says nothing concerning the true construction of "compensation paid ... under this Act" in s 138(3)(a). The relevant "burden of payment" must be a burden to pay because of a liability to pay under the Act.

67 Finally, the VWA relied upon what it described as "the presumptive wording" of s 239A of the Act. Section 239A of the Act provides:

"239A. Certificate

A certificate purporting to be signed by an officer or employee of the Authority certifying as to any of the prescribed particulars specified in the certificate relating to amounts (including amounts of compensation) paid or payable by the Authority under this Act or the Accident Compensation (WorkCover Insurance) Act 1993 is evidence of the matters stated in the certificate and, in the absence of evidence to the contrary, is proof of those matters."

68 The expression "prescribed" is defined in s 5 of the Act to mean "prescribed by the Regulations". Regulation 5 of the Accident Compensation Regulations 2012 sets out the prescribed particulars for the purposes of s 239A of the Act. Regulation 5 contains 20 matters, none of which relate to (or include) whether the relevant payment was made under the Act.[39] Accordingly, this argument must also be rejected. However, before leaving it, I note that s 239A refers to a certificate "purporting" to be signed by an officer or employee of the VWA. One might have thought that if it was intended to permit the VWA to recover an indemnity under s 138 in respect of payments merely made purportedly under the Act, then Parliament could have so provided.

69 For the above reasons, I reject the VWA's submission that it is entitled to an indemnity even when payments of compensation have been made where there was no liability under the Act[40] to make them.[41] I turn now to consider the defendant's contention that compensation was never properly payable in respect of Ms Williams' injuries.

70 Ms Williams worked on the third floor of 589 Collins Street. The defendant contends that as the accident happened on the ground floor before Ms Williams commenced work on 16 October 2002, her injuries did not arise out of or in the course of her employment within the meaning of s 82 of the Act.[42] Essentially, the defendant contends that Ms Williams' injuries were suffered in what would have been called a journey accident, before 1 December 1992.[43]

71 As was said by Dixon J[44] in Henderson v The Commissioner of Railways (Western Australia),[45] cases concerning the determination of whether or not injuries arise out of or in the course of employment "are never easy". In that case, a worker was killed during the luncheon hour in circumstances where his hours of work were specified as being from 8.00am to 12 noon and 1.00pm to 5.00pm. Dixon J went on to say:[46]

"Where the accident arises shortly before the beginning of actual work or shortly after its cessation, or in an interval when labour is suspended, and it occurs at or near the scene of operations, the question whether it arises in the course of employment will depend on the nature and terms of the employment, on the circumstances in which work is done and on what, as a result, the workman is reasonably required, expected or authorised to do in order to carry out his actual duties. That the workman is liable to the control of the employer is of some importance. That he has not yet assumed the same relation to his employer's premises and work as an ordinary member of the public is another matter of weight ... ."

72 In Victorian WorkCover Authority v Michaels,[47] the Court of Appeal had to consider a case where a university lecturer suffered an injury in a book shop, seven days before commencing employment, while looking for and perusing suitable texts in preparation for his forthcoming university classes. The Court said:[48]

"In the present case, the injury was suffered seven days before the respondent was to commence his teaching duties. Counsel for the appellant relied much on this interval, referring to the statement in Henderson's case to the effect that an entitlement may be incidental to the performance of work where the accident arises shortly before the beginning of the actual work.[49] They contended that the requirement of temporal proximity to the commencement of duties expressed in the words 'shortly before the beginning of actual work' was such that an accident could not be said to be suffered in the course of employment unless it immediately preceded the commencement of the work.

We are not persuaded that the expression 'in the course of his employment' should be considered in such a rigid way. Although it is very much encrusted with decades of judicial exposition, it must be to the words of the statute that we turn when considering a novel situation. We accept that, in general, the greater the interval between the injury and the commencement of work, the greater the employee's difficulty in demonstrating the required relationship. But this is an essentially factual issue which must be considered in all the circumstances. These circumstances will include the nature of the employment and the activity undertaken at the time of the injury and its relationship to the work which the employee was engaged to perform. What must be shown is that the injury was suffered in the course of activities done as part of the work which the employee was engaged to perform."[50]

73 There is a paucity of material in relation to the nature and terms of Ms Williams' employment. However, I have concluded that her injuries satisfy the statutory formula in s 82 of the Act. Remembering that the question is essentially a factual one, in my view, this case falls to be decided by the application of reasoning similar to that applied by the Court of Appeal in Foster v Edwin Penfold & Co Limited.[51] The facts of that case may be briefly stated as follows. The employers' premises stood between a public highway and a wharf which was not their property. On the wharf stood a garage which was leased by them. Employees were allowed to park their cars on the private wharf. There was a private passage at the back of the employers' premises by which access could be obtained to the wharf. On the night in question, the deceased worker ran his car against a bollard on the wharf, and the deceased fell into the river.

74 Slesser and Romer LJJ held that the accident arose in the course of employment. They so held, because the accident occurred while the deceased was using a permitted means of egress from his work and on a spot where he happened to be not as a member of the public, but only by virtue of his employment. The ownership or control of the spot where the accident occurred was held to be immaterial.

75 While in the present case there are arguments both ways, I accept that Ms Williams' injuries occurred while she was using a permitted (if not expected) means of gaining access to her work area. Further, Ms Williams was in the foyer of the building, not as a member of the public, but only by virtue of her employment. Additionally, she was proceeding in the building directly to her work area. Accordingly, I am satisfied that Ms Williams' injuries arose out of or in the course of her employment within the meaning of s 82 of the Act.[52]

[2] See s 299 of the Accident Compensation Act. But cf Victorian WorkCover Authority v Kenman Kandy Pty Ltd [2002] VSCA 190; (2002) 6 VR 666, [11]-[15] for the position as it was prior to the commencement of s 8 of the Compensation and Superannuation Legislation Amendment Act 2008.

[3] Cf Central Goldfields Shire v Haley & Ors [2009] VSCA 101; (2009) 24 VR 378, [4]-[6] (Neave JA).

[4] "Services" is defined in clause 1.1 to mean "The Management Fee Services; and the Transition Services". "Management Fee Services" is defined to mean "The management of all Managed Services; and the direct provision of all of those tasks forming part of the Facilities Management Services, Real Estate and Lease Management, Financial Management Services, Help Desk Services, Sub-contractor, Management, Regulatory Compliance, Document Management, Contract Management and Performance Management described in the Service Specification that are designated in that specification as being the responsibility of JLL to provide, perform or undertake; and the provision and operation of a management information system in accordance with the MIS Specification". Each of the expressions whose words begin with capital letters are then further defined in clause 1.1. For example, "MIS Specification" is defined to mean the specification for the management information system contained in Schedule 5" and "Facilities Management Services" is defined to mean the tasks described in s 3.2.1 of the Service Specification.

While I have worked through and had regard to each of the definitions in the service provider agreement, it is not productive to continue to set out all of the various definitions and definitions within definitions in the service provider agreement. That said, I should set out for completeness the definition of "Transition Services" having regard to its importance in the definition of "Services". "Transition Services" is defined to mean "activities and task (sic) required to be conducted during the Transition Period to ensure the effective commencement of the Services on the Effective Date, as set out in the Transition Plan". I should also note that the efficacy of this circular set of definitions ("Services" means "... Transition Services", which itself means "activities ... to ensure the effective commencement of the Services ...") was not debated before me.

[5] "Managed Services" is defined in clause 1.1 of the service provider agreement to mean "Those services within the overall scope of this Agreement , which will not be directly performed by JLL, but will be provided by Existing Contractors under Existing Contracts or by sub-contractors and suppliers engaged directly by JLL". "Existing Contractors" is defined to mean "The contractors engaged by or on behalf of VGPG in connection with the Existing Contracts". "Existing Contracts" means the contracts listed in Schedule 7 of the service provider agreement. While no party took me to Schedule 7, and the parties were content to conduct this proceeding on the basis that while the Court Book was tendered, no use would be made of any document or part thereof not referred to or mentioned by either party during the hearing, an examination of Schedule 7 does not reveal any contract that was obviously a cleaning contract in respect of 589 Collins Street.

[6] See for example the definitions of "Help Desk Services", "Managed Services", "Management Fee Services" and "Sub-contractor Management" in clause 3.1.2 of Schedule 3 of the service provider agreement.

[8] Undated, but handed up on 6 September 2012.

[12] See s 8 of the Compensation and Superannuation Legislation Amendment Act 2008.

[13] Cf Fullagher J's description of the Accident Compensation Act in Robart v Matchplan Pty Ltd (unreported Supreme Court of Victoria Appeal Division, delivered 21 December 1993).

[15] Alcoa Portland Aluminium Pty Ltd v Victorian WorkCover Authority [2007] VSCA 210; (2007) 18 VR 146, [16]-[26], and in particular at [16] and [18]. See further, Victorian WorkCover Authority v Esso Australia (2001) 207 CLR 520 and Sweedman v Transport Accident Commission [2006] HCA 8; (2006) 226 CLR 362 at 400-1.

[18] The text of the sections is identical, save in two respects. First, while s 51(2) contains the words "in an appropriate case", s 5D(2) contains the words "in an exceptional case". Secondly, while s 5D(3) mirrors the subjective test set out in s 51(3), s 5D(3) goes on to provide that "any statement made by the person after suffering the harm about what he or she would have done is inadmissible except to the extent (if any) that the statement is against his or her interest".

[19] March v E & M H Stramare Pty Ltd (1991) 171 CLR 506; 99 ALR 423; [1991] HCA 12 (March).

[20] March at CLR 515; ALR 430; quoting from Fitzgerald v Penn [1954] HCA 74; (1954) 91 CLR 268 at 277; [1954] HCA 74; [1955] ALR 1 at 6; [1954] HCA 74.

[22] Adeels Palace Pty Ltd v Moubarak [2009] HCA 48; (2009) 239 CLR 420, 441 [49].

[26] But see generally, Division 1 of Part V of the Act.

[27] See s 5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) and its analogues (including the former s 24(1)(c) of the Wrongs Act): Baylis v Waugh [1962] NZLR 44; James P. Corry & Co Limited v Clarke [1967] NI 62, 71; Stott v West Yorkshire Car Company [1971] 2 QB 651; Bakker v Joppich (1980) 25 SASR 468, 475; Bawden v Saint (1988) 141 LSJS 306; Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574, 616 and Brambles Australia Limited v British and American Tobacco Australia Services Limited [2005] NSWDDT 8.

[29] With whom Asche CJ and Kerney J agreed.

[31] Email from Senior Counsel for the VWA sent 6 September 2012 at 1.24pm.

[38] DSG Pty Ltd v Victorian WorkCover Authority [2008] VSCA 42; (2008) 20 VR 514, 532[87].

[39] While s 239A contains the words "relating to amounts (including amounts of compensation) paid or payable by the Authority under this Act", the subject matter of the section concerns the certification of prescribed particulars - not the certification of whether or not an amount of compensation has been paid under the Act. In any event, such a certificate is only proof of the relevant matters "in the absence of evidence to the contrary". Thus, a s 239A certificate cannot prevent a defendant in a s 138 recovery action from (at the very least) seeking to prove (and/or persuade the Court) that payments made in respect of a worker's injury were not payments for which there was any liability under the Act.

[40] Either by reason of the mere operation of the provisions of the Act, or by reason of a relevant award holding that there is a liability under the Act.

[41] For the sake of completeness, I should note that the VWA did not explain how its preferred construction would work in circumstances where the Court concluded there had never been a liability to pay compensation under the Act. On the VWA's construction, the VWA would still be able to recover payments already made up to the limit of the statutory formula. The question then arises as to what its entitlement under the section might be in respect of future payments. Could or would the VWA go on making payments notwithstanding a court had determined (in proceedings to which the worker was not a party) that there was no liability? If so, could the VWA continue to recover those payments up to the limit of the statutory formula? If the VWA could not continue to recover future payments, then the VWA's construction would permit it to determine the quantum of its claim against a third party in a s 138 recovery action by delaying the issuing and prosecution of its proceeding. A construction which permits a claimant under s 138 to recover a larger indemnity by the simple course of delaying issuing should not lightly be accepted.

[42] And none of the circumstances which might deem Ms Williams' injuries to arise out of or in the course of her employment as provided for in s 83 exist in the present case.

[43] When s 83 of the Accident Compensation Act as it was in force prior to 1 December 1992 was amended by s 12 of the Accident Compensation (WorkCover) Act 1992.

[49] Henderson v Commissioner of Railways (WA) [1937] HCA 67; (1937) 58 CLR 281, 294 (Dixon J).

[52] See further, Lawrence v George Matthews (1924) Limited [1929] 1 KB 1; Stewart & Ors v The Metropolitan Water, Sewerage and Drainage Board [1932] HCA 45; (1932) 48 CLR 216; Weaver v Tredegar Iron and Coal Company Limited [1940] AC 955 and Roncevich v Repatriation Commission [2005] HCA 40; (2005) 222 CLR 115.