Thursday 8 October 2009
Giovanni Zotti v Australian Associated Motor Insurers Limited
Judgment
1 SPIGELMAN CJ: In circumstances to which I will presently refer the applicant was injured and, as a result, instituted proceedings in the District Court. By reason of his failure to commence those proceedings within the time specified, after receipt of a notice under s 110 of the Motor Accidents Compensation Act 1999 ("the Act"), the applicant was taken to have withdrawn the claim by s 110(3) of that Act. Accordingly, the applicant applied to the District Court to exercise the power in s 110(5) of the Act which states:
"110(5) The court may reinstate the claim if the court is satisfied that the claimant has a full and satisfactory explanation for the failure to comply with the notice."
2 On 16 December 2008 Neilson DCJ upheld the applicant's contention that he had made the requisite "full and satisfactory explanation" for his failure. However, his Honour refused to reinstate the claim on the basis that it would be futile to do so because the circumstances of the accident were such that there was no "injury" within the meaning of the Motor Accidents Compensation Act. No issue arises with respect to the existence of the discretion which his Honour exercised.
3 It is pertinent to set out two definitions in s 3 of the Act (as at 19 December 2005, the date of the applicant's injury):
" motor accident means an accident or incident caused by the fault of the owner or driver or a motor vehicle in the use or operation of the vehicle which causes the death of or injury to a person."
" injury:
(a) means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use of operation of the vehicle if, and only if, the injury is a result of and is caused during:
(i) the driving of the vehicle, or
(ii) a collision, or action taken to avoid a collision, with the vehicle, or
(iii) the vehicle's running out of control, or
(iv) such use or operation by a defect in the vehicle …
(b) …"
4 The Act was in the same form as was considered by the High Court in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd [2005] HCA 26; (2005) 221 CLR 568. Neilson DCJ relied on certain parts of the reasoning in the judgment of McHugh J and in the joint judgment of Gummow, Hayne and Heydon JJ, to which I will further refer below.
5 His Honour expressed the following conclusions with respect to the definition of injury when he said:
"[31] …
One can see that firstly the injury must be caused by the fault of the owner or driver of the vehicle in its use or operation, but if and only if there is both a causal and a temporal relationship with the driving of the vehicle or its colliding or taking action to avoid a collision, or its running out of control, or the use and operation of the vehicle by a defect in the vehicle.
[32] That there is a causal and temporal relationship is clear from the verbiage of the legislation … Here, on the facts that I have outlined, the plaintiff's injuries were not caused by and during the driving of the vehicle. They were not caused by or during a collision, or an action taken to avoid a collision. They were not caused by the vehicle's running out of control and during its running out of control, and the injury was not caused by and was not the result of the use of operation of the vehicle, because it was sustained during that activity and it was not caused by a defect in the vehicle.
[33] Counsel of the plaintiff essentially ask me to read the provision, as if it meant nothing more that the injury was caused by the use or operation of the motor vehicle. …
[34] … the injury must be sustained temporally during the use or operation of the vehicle. It was not. The first defendant's motor vehicle had been towed by a tow truck from the scene of the plaintiff's accident at some unspecified time prior to it."
6 I should note that insofar as his Honour concluded that there was no causal connection - in addition to the absence of the temporal connection - the respondent did not seek to uphold that reasoning. The focus of the respondent's submissions was upon the temporal connection arising from the word "during" in the definition of injury.
7 Neilson DCJ set out the relevant facts. The accident had occurred when the applicant, who was riding a bicycle, fell off when he came to an oil patch on the roadway. That oil had been deposited in the course of a motor car collision that had occurred some two hours earlier. The cars involved in that collision had been towed away. Police and the fire brigade had attended the accident and cleaned up the scene. Nevertheless, some oil was left on the roadway. (I note that proceedings are still extant against the State of New South Wales with respect to alleged negligence on the part of the police and fire brigade.)
8 The respondent is the compulsory third party insurer of the driver of the vehicle who caused the original collision.
9 I have set out at par [3] above the definition of injury. The submissions in this case focused on whether or not the applicant's injury can be said to have been "caused during a collision" within the meaning of par (a)(ii) of the definition. Submissions which made reference to "driving" were not materially different. Indeed, counsel for the applicant accepted that any "driving" had stopped.
10 Of particular significance for present purposes is the passage from the joint judgment in Allianz supra, quoted by Neilson DCJ, where Gummow, Hayne and Heydon JJ said:
"[93] In argument, some suggestion was conveyed that the terms 'result' and 'cause' have different meanings and, in particular, that 'cause' narrows 'result'. That is not so. The drafting in this second part of para (a) of the definition seeks to accommodate two cumulative criteria and does so by telescoping them into a grammatical contortion.
[94] One criterion is that the injury be sustained during certain events, including the driving of the vehicle or a collision with the vehicle or its running out of control. The other criterion is that the injury be sustained as a consequence of those events. The phrase 'as a result of' is linked to the first or temporal criterion; the phrase 'is caused' is linked to the second criterion. For sub-para(iv), the temporal criterion is that the injury be a result of the use or operation of the vehicle because it was sustained during that activity. The other criterion is that the injury be caused by a defect in the vehicle."
11 The reasoning of McHugh J in Allianz supra, was, for present purposes, to broadly similar effect as the joint judgment. His Honour said:
"[18] … The … conditions in sub-pars (i)-(iii) require that the injury:
be a result of the driving of the vehicle or a collision (or action taken to avoid a collision) or the vehicle running out of control,
be caused during the driving, the collision (or action taken to avoid a collision) or the vehicle running out of control (the temporal requirement).
…
[23] The second aspect of causation relates to the four conditions that limit the general class of injuries to which the Act applies. Where there is a defect in the vehicle, the injury must be 'a result of and is caused during ... such use or operation by a defect in the vehicle'.
[24] The expression 'caused during such use or operation' imposes a temporal causal requirement. Where there is a defect in the vehicle, the defect must be operative when the injury is sustained and the vehicle must be in 'such use or operation' to which the fault of the owner attaches when the injury is sustained. Allianz conceded that Mr Oliver's injury occurred during the use or operation of the vehicle [ Allianz (2003) 57 NSWLR 321 at 336 [64] per Davies AJA]." [Emphasis added]
12 The applicant submitted that Allianz should be understood as a case concerned only with sub-par (iv) of the definition of "injury", being the sub-paragraph which the injury there under consideration was said to fall. However, the judgment of the High Court cannot be so confined.
13 Nevertheless, the reasoning in Allianz does need to be adapted to, relevantly, sub-par (ii). As the first sentence of [94] in the judgment makes clear the relevant first criterion is: "that the injury be sustained during … a collision with the vehicle … ." In the second last sentence of [94] this is referred to by their Honours as "the temporal criterion". The second criterion to which their Honours refer turns on the phrase "as result of" which their Honours treat as equivalent to "is caused" by, relevantly, "a collision".
14 As I have indicated, in this Court the respondent focused primarily on the first criterion, rather than the second. As the submissions proceeded, it became apparent that the issue before the Court did not turn on the meaning of the word "during". Rather the issue turned on the interpretation of the word "collision". The critical issue is to determine when, in the context of this legislative scheme, it can be said that a "collision" has ended.
15 The only case which has considered the temporal criterion is Dominello v Dominello [2009] NSWCA 95; (2009) 52 MVR 292. The relevant judgment was that of Handley AJA, with whom Beazley and Macfarlan JJA agreed.
16 His Honour was dealing with the liability of the nominal defendant with respect to oil that had been left on the road by an unidentified vehicle which, on the hypothesis under consideration, had an uncapped or poorly capped fuel tank leading to the spillage. Other factual scenarios were rejected.
17 Handley AJA said:
"[99] The first causal requirement is that the injury must be caused by fault 'in the use or operation of the vehicle'. The second, which includes a temporal element, is that it must be 'the result of and … caused during' one of the activities, events, or situations referred to in the subparagraphs.
[100] Mr Gross QC, for the Nominal Defendant, submitted that the definition required the injury and the fault to both occur during one of those activities, events, or situations, and this had not happened.
[101] In my judgment there is no such temporal requirement. The relevant requirements are for the injury to be caused by the fault of a relevant person (owner or driver), in a relevant activity (use or operation) but only if that injury was caused during another relevant activity, event, or situation (the subparagraphs).
[102] On the findings proposed these requirements are satisfied. The inferred fault is that of the driver of the unidentified vehicle and it occurred in the use of the vehicle. Refuelling a vehicle, which enables it to be driven, is part of its maintenance, and part of its use. Although the vehicle is not being driven while it is being refuelled, it is being used to receive and hold the fuel just as it may be used to receive and hold chattels or passengers. The plaintiff's injury was the result of the driving of the unidentified vehicle, and caused when the driving caused the spill. The injury was also caused by the driver's fault during the driving when he failed to remember that he had not replaced the fuel cap and stop his vehicle to do this.
[103] The injury was also caused by the driver's fault during the driving of the vehicle by a defect in the vehicle, its open fuel tank. The fuel cap is an important part of the vehicle because it can prevent loss of fuel by spillage and its contamination by airborne material. A vehicle without a fuel cap has a defect and it has another if an available fuel cap is not fitted, or not properly fitted."
18 After referring to the two judgments in Allianz supra including par [102], to which I refer at [26], Handley AJA concluded:
"[109] The decisive causative element in the present case was 'the passive condition' of the fuel tank without its fuel cap which permitted the spillage to occur. The fuel level in the tank, the driving of the vehicle, the configuration of the reverse bend, and the arrival of the van travelling at 100 kph, in the language of McHugh J, were 'merely … background facts which had to exist for the injury to occur', and it was the defect in the vehicle 'that caused the injury'.
[110] In the language of the plurality the open fuel tank was the predominant and immediate cause of the spillage and this was the immediate cause of the injury."
19 As par [99] of Handley AJA's judgment makes clear his Honour identified a requisite "temporal element". The first sentence of par [101] in which his Honour states that "there is no such temporal requirement" turns on the word "such". This is a reference to the particular kind of temporal requirement for which counsel for the nominal defendant contended at [100]. That is not the contention in the present case.
20 The respondent seeks leave to argue that Dominello is wrong with respect to the reasoning on the temporal element. That is why the Court sat a bench of five.
21 I would not grant leave on the basis that the reasoning should be understood as responsive only to the specific submission made in that case. In Dominello it does not appear to have been contended that the temporal element, considered as a separate "criterion" (to use the language of the joint judgment in Allianz supra at [94] set out at [10] above) was not satisfied on the facts. It is difficult to see how it could be said that the injury was "sustained" (to use the language of the joint judgment in Allianz supra at [94] and of McHugh J at [24]) within a time period in which "driving" was occurring or during which a vehicle with a defect was in "use or operation". I do not understand Handley AJA to doubt the significance of the temporal element identified in Allianz. (See also Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 228 CLR 529 at [95].)
22 The present case turns on when a "collision" ends. It can be accepted that the word "collision" does not refer only to the point of impact. It may well be the case that, for as long as the vehicles which had collided remained in their post-collision positions, the "collision" would still be in existence. Accordingly, any further incident that occurred by another vehicle running in to either car would fall within the meaning of "injury" and "motor accident".
23 The position with a remnant of oil slick is, however, further removed. Ms S Norton SC, who appeared for the applicant submitted that the "collision" continues until the effects of the collision have been removed.
24 In my opinion, that submission should be rejected. After the cars have been removed it cannot be said that the "collision" was still extant. Detritus such as oil is simply aftermath, not a continuation of the original event.
25 Ms Norton submitted in the alternative that the Court should read the word "caused" broadly when appearing in the chapeau (a) to the definition of injury in s 3.
26 Ms Norton relied on a passage from the joint judgment in Allianz supra where their Honours said:
"[102] The use in the definition of the emphatic and intensive phrase 'if, and only if' directs attention to notions of predominance and immediacy rather than to more removed circumstances. The definition of 'injury' looks for the CTP insurance system, to notions of proximate cause found in insurance law …"
27 Ms Norton submitted that the direct, effective or proximate cause of the applicant's injury was the oil on the road, which was caused during the driving of the vehicle and/or during a collision involving the vehicle. It may well be an appropriate characterisation to identify the oil as the proximate cause. However, the next step - required by the statute - towards the collision and/or the driving is further removed from the cause that is direct, effective or proximate.
28 Ms Norton submitted that the words "caused during" do not require the simultaneous occurrence of the events - whether the "driving" or the "collision" - and the injury. The words "caused during" should not be read as if they were the same as "occurs during". She submitted that a "proximate cause" - namely the collision - can be a causal agent which subsequently leads to an injury.
29 In this respect it is pertinent to note the composite phrase in the definition: "the injury is a result of and is caused during …" the event. Ms Norton's submission would, in my opinion, have the effect that the words "caused during" would add nothing to the words "as a result of". These were "cumulative criteria" (Inasmuch Community Inc v Bright [2006] NSWCA 99; (2006) 45 MVR 234 at [24]) or a "conjunctive requirement" (GLG Australia supra at [96]). The law of statutory interpretation creates a presumption - albeit not always a strong presumption - against surplusage. (See cases referred to in Solution 6 Holdings Ltd v Industrial Relations Commission (NSW) [2004] NSWCA 200; (2004) 60 NSWLR 558 at [74]-[75].)
30 In any event, it is not, in my opinion, open to this Court to adopt the applicant's submission.
31 First, the submission is not consistent with the High Court's identification of the purpose of the legislation to narrow the concept of the "injury". (See Allianz supra at [101]-[102] and GLG Australia supra at [25], [95].)
32 Furthermore, more specifically, at [94] of the joint judgment in Allianz, set out at [10] above, the joint judgment expressed the "temporal criterion" in the following way: "the injury be sustained during certain events including … a collision" (emphasis added). Although Allianz was concerned with sub-par (iv) of the definition of injury, this Court is obliged to follow, it has been determined, the clearly expressed dicta of the High Court even if not part of the ratio decidendi. (See Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [134] and [158].)
33 The injury in this case was not "sustained during" a collision. It is not open to this Court to hold that, even if the collision could, for some purposes, be the "proximate cause" of the injury, that the injury was "caused during" the collision, within the meaning of the Act.
34 During the course of the hearing the Court was informed that the driver of the vehicle insured by the respondent, Mr Basa, who was a party in the District Court, had been informed of the appeal but had not been joined. Directions were made by the Court requiring the applicant to file and serve a Notice of Motion to join Mr Basa to the appeal, to inform him of the proceedings and to give him an opportunity to make submissions to the Court.
35 In compliance with the directions, the applicant has, by Notice of Motion, sought an order pursuant to Pt 51.4(3) of the Uniform Civil Procedure Rules 2005 that Rafael Basa be joined as a second respondent. This was supported by an affidavit indicating compliance with the Court's directions and an affidavit of service. These affidavits are taken as read in proceedings.
36 Mr Basa has not sought to make any submissions to the Court within the time specified in the directions, of which he has been notified.
37 The orders I propose are:
1 Order that Rafael Basa be joined as second respondent to these proceedings.
2 Grant leave to appeal.
3 Direct the applicant to file a Notice of Appeal within 14 days of the date hereof.
4 Appeal dismissed with costs.
38 ALLSOP P: I have read the reasons of the Chief Justice. I agree with the orders proposed by him and, subject to what follows (being largely matters of emphasis and comment) with his reasons.
39 There is much to be said for the argument put clearly and helpfully by Ms Norton SC that the definition of injury in the Motor Accidents Compensation Act 1999 (NSW) (the "Act"), s 3 before its amendment in 2006 had a coherent meaning that conformed with and fulfilled the policy reflected in the secondary material, of removing from the intended insurance cover provided by the Act injuries peripherally connected with a sensible conception of a motor vehicle accident, but under which Mr Zotti's accident can be seen to fall.
40 In Ms Norton's submission, the "injury" (being the personal or bodily injury caused by the fault of the owner or driver etc) is an injury if, but only if, the injury is a result of the events or activities in s 3 (i)-(iv) and is caused during such events or activities.
41 By this construction, a dual restriction is imposed on the injury intended to be covered by the definition which can be seen to be the fulcrum of an insuring clause of a statutory insurance.
42 The words "resulting from" have in some cases been said to impose a requirement of proximate cause: see Commonwealth v Butler [1958] HCA 56; 102 CLR 465 at 476 (per Taylor J) and Pickersgill v Freightbases Pty Ltd [1983] 3 NSWLR 117. The High Court, however, in Conkey & Sons Ltd v Miller (1977) 51 ALJR 583 decided unanimously that Butler did not decide any principle of law. Further, this Court in Kooragang Cement Pty Ltd v Bates (1994) 10 NSWCCR 796 at 809-810 (Kirby P, Sheller JA and Powell JA agreeing) declined to follow Pickersgill to the extent that it was authority for the proposition that the phrase "resulting from" embodied a notion of proximate cause. In his reasons in that case, Kirby P referred to similar views expressed by him and McHugh JA in a number of previous cases. Kirby P said the following at 810:
" …Whether death or incapacity results from a relevant work injury is a question of fact. The importation of notions of proximate cause by the use of the phrase 'results from', is not now accepted. By the same token, the mere proof that certain events occurred which predisposed a worker to subsequent injury or death, will not, of itself, be sufficient to establish that such incapacity or death "results from" a work injury. What is required is a commonsense evaluation of the causal chain. As the early cases demonstrate, the mere passage of time between a work incident and subsequent incapacity or death, is not determinative of the entitlement to compensation. In each case, the question whether the incapacity or death "results from" the impugned work injury (or in the event of a disease, the relevant aggravation of the disease), is a question of fact to be determined on the basis of the evidence, including, where applicable, expert opinions. Applying the second principle which Hart and Honoré identify, a point will sometimes be reached where the link in the chain of causation becomes so attenuated that, for legal purposes, it will be held that the causative connection has been snapped. This may be explained in terms of the happening of a novus actus . Or it may be explained in terms of want of sufficient connection. But in each case, the judge deciding the matter, will do well to return, as McHugh JA advised, to the statutory formula and to ask the question whether the disputed incapacity or death 'resulted from' the work injury which is impugned."
43 Views, however, have not been unanimous. For example, in S and Y Investments (No 2) Pty Ltd (in liq) v Commercial Union Assurance of Australia Ltd (1986) 44 NTR 14, the Supreme Court of the Northern Territory held that words "occurring as a result of" were equivalent to "is caused by" and thereby imposed a requirement of proximate causal connection.
44 Whatever the reason for the terminology in s 3, the phrase "is a result of" can be seen to require some kind of causal relationship between the injury and the event or occurrence. The second of the cumulative requirements: "the injury is caused during" the relevant events or occurrences can be seen to limit further the operation of the definition, by restricting the response of the statutory insurance to injuries which can be seen to have a cause occurring during the events or occurrences in (i)-(iv). This would not be surplusage being added. The phrase "a result of" may be seen to have a broader content than "caused"; but, more specifically, the cause must occur during the relevant event or occurrence in (i)-(iv). Looking at the matter thus, it would not be a requisite that the injury be sustained or be suffered or occurred during the relevant event or occurrence in (i)-(iv); rather, the necessary constriction is that the cause of the injury occur during the event or occurrence. This approach, it might be thought, would more happily sit with the words "the injury is caused during" the event or occurrence. If a notion of "sustaining" or "suffering" the injury during the event or occurrence were intended it might be thought that such phrases would have been used rather than the words in fact employed: that "the injury is caused during".
45 Such a construction would limit the response of the statutory insurance to circumstances more narrow than the kinds of peripheral connection with a motor vehicle and its use that arose in the jurisprudence dealing with "arising out of" the use of motor vehicle: see for example Government Insurance Office (NSW) v R J Green & Lloyd Pty Ltd [1966] HCA 6; 114 CLR 437; State Government Insurance Commission v Stevens Brothers Pty Ltd [1984] HCA 32; 154 CLR 552; Dickinson v The Motor Vehicle Insurance Trust [1987] HCA 49; 163 CLR 500 and many other cases. In this jurisprudence, the phrase "arising out of" the insured peril imposed no requirement that the loss be proximately caused by that peril; see the above cases and also Clover, Clayton & Co Limited v Hughes [1910] AC 242 at 245.
46 As well as fulfilling the evident policy of reducing the scope of the insurance cover under the Act, the above construction would ensure that the operation of the Act and the insurance provided under it were not limited in circumstances that might be capricious or arbitrary. As this very case shows, if the actual injury must be sustained or suffered during the events or occurrences set out in (i)-(iv) persons can be left without effective insurance cover in circumstances where the injury constitutes the direct sequelae of the accident and the cause of the injury occurred during, and was intimately bound up with, the motor vehicle accident. On an ordinary appreciation of events, an injury can be seen to be caused by a motor vehicle accident if the relevant causal link occurred during the collision (or other event or occurrence in (i)-(iv)).
47 Unconstrained by authority I would be minded to agree with these arguments, which were, in substance, put by Ms Norton. However, as I read [93] and [94] of the reasons of Gummow, Hayne and Heydon JJ in Allianz Australia Insurance Limited v GSF Australia Pty Ltd [2005] HCA 26; 221 CLR 568 at 596 these arguments are precluded. This is also the view of the Chief Justice with which I agree. I note, however, that [101] of their Honours' reasons in Allianz may conceivably affect [93] and [94]. Nevertheless, though [93] and [94] do not, on my reading, form part of the ratio of the judgment of their Honours, I would take them to fall within the category of "seriously considered dicta": Farah Constructions Pty Limited v Say-Dee Pty Limited [2007] HCA 22; 230 CLR 89 at 150-151 [134] and 159 [158]. In the light of these paragraphs of the judgment of Gummow, Hayne and Heydon JJ in Allianz the definition of "injury" is to be construed as requiring the injury to be sustained during the relevant event in (i)-(iv). That did not happen here.
48 Though the definition of "injury" in s 3 of the Act has been amended to remove these particular provisions, they have been moved, in substance, into the definition of "motor accident". A not dissimilar construction will arise under that provision.
49 During the argument on the appeal there was reference to a notion of causation in insurance being of a different character to ordinary notions of causation. The High Court in Allianz at [101] also referred to questions of causation in insurance law. Insurance is, of course, an area of discourse in which questions of causation constantly arise. Phrases such as "proximate cause" and "dominant cause" have had a particular place in the law of insurance. The view prevailed for many years that for the purpose of answering a question about the response of an insurance policy there could be only one cause: National & General Insurance Co Ltd v Chick [1984] 2 NSWLR 86 at 97-98 where Samuels JA quoted Colinvaux R, The Law of Insurance (4th Edition) (Sweet & Maxwell 1979) at [4.32] as follows:
"A loss may be the combined effect of a whole number of causes, but, for the purposes of insurance, one direct or dominant cause must in each case be singled out."