Allianz Australia Insurance Limited v Insurance Australia Limited [2011] ACTSC 19
Background
On 8 April 1996 Mr Van Den Dungen was injured when he was hit by a piece of concrete kerbing as he was standing near his tipper truck which was parked at a construction site. At the time, his tipper truck was being filled with debris by a bobcat. Mr Van Den Dungen sued his employer and the operator of the bobcat for damages for personal injuries. He obtained judgment against his employer. Allianz was the workers' compensation insurer of the employer.
At the time of the accident, the employer's truck was covered by a compulsory third party policy issued by Insurance Australia Limited ('IAL').
Allianz contended that the employer was indemnified in respect of its liability to Mr Van Den Dungen under both the workers' compensation policy issued by it to the employer and also under the third party policy effected by the employer with IAL. Allianz submitted that the principles of double insurance applied and it was entitled to recover from IAL, by way of contribution, half of the amount of the judgment and half of the amount of costs paid by it to Mr Van Den Dungen.
Circumstances of the accident
It was accepted by the Court that at the time of the accident, the truck was stationary with its engine off. Further, at the time of the loading process, Mr Van Den Dungen did not direct the operators of the bobcat or the front end loader, nor did he supervise the loading. All he did was observe the loading process.
It was found the bobcat was the only machine that was loading the truck and that Mr Van Den Dungen was standing on the driver's side of the truck, whereupon the bobcat caused the piece of concrete kerbing to fall and bump the side of the truck and strike Mr Van Den Dungen.
Prior decisions
The critical question for the Court was whether the injuries suffered by Mr Van Den Dungen were 'caused by or arising out of the use of his truck.'
The Court referred to the following prior decisions:
- Fawcett v BHP By Products Pty Limited (1960) 104 CLR
80. In this matter the High Court considered whether damages
awarded to the operator of a mechanical loader in respect of
injuries suffered when the loader was being used in the resurfacing
of a road were indemnified under the operator's employer's
motor vehicle third party policy. The High Court held that the
injuries suffered by the operator of the loader in the course of
its use in resurfacing the road were caused by or arose out of the
use of the loader. Menzies J made the following findings:
- Indemnity against all liability in respect of the bodily injury to any person caused by or arising out of the use of a motor vehicle cannot be confined to liability arising while the vehicle is actually in motion
- The use of an item of machinery such as the mechanical loader in its capacity as a loader does not take that use outside the terms of the relevant statutory indemnity
- The indemnity provided by the statutory policy is not concerned with fine distinctions but requires the use of a policy that covers liability arising out of everything that falls fairly within the conception of the use of a motor vehicle.
- Government Insurance Office (New South Wales) v RJ Green & Lloyd Pty Limited
- (1966) 114 CLR 437. A workman was injured when several workmen employed by the insured were loading a hoist onto a truck.
In the course of loading the hoist onto the truck, the hoist slid off the planks and injured one of the workmen who was engaged in the loading process. The High Court held that the workman suffered injuries which were caused by or arose out of the use of the truck as a motor vehicle. Barwick CJ held that the indemnity provided by the statutory third party policy was not limited to the use of a motor vehicle in or upon public thoroughfares or its movements. Further, Barwick CJ at pp441 443 said:
- The more recent decision of Commercial Building Centre Pty Limited v NRMA Insurance Limited [2004] ACTCA 3. Mr Delaney was the middleman in a line of three workmen involved in the loading process and was injured. At first instance, Connolly J concluded that the injuries sustained in consequence of the means adopted by Mr Delaney to pass to Brian the bag of plaster was too remote from the process of loading the bags onto the truck to constitute an injury sustained arising out of a use of the truck. Connolly J formed the view that Mr Delaney was injured in performing his work in assisting Mick to transfer the bags from the pallets to a point where they were available to Brian to load onto the truck.
The Court of Appeal upheld Connolly J's findings and found that although the task being undertaken by Mr Delaney was connected with the loading, the injury was not a direct, proximate or some less immediate, consequence of the operation of the loading and the use of the truck. In particular, the loading of the bags of plaster was 'a merely causal concomitant, not considered to be, in the relevant causal sense, a contributing factor.'
Decision
After referring to the above decisions, Foster J of the ACT Supreme Court found that the 'use' to which Mr Van Den Dungen's truck would ordinarily be put was as a tipper truck. Further, tipper trucks are utilised to carry loads from one place to another, and an integral part of a tipper truck's ordinary use is the loading of material onto the truck. From this, Foster J concluded that Mr Van Den Dungen was injured when his truck was being loaded and the loading activity which was taking place when he was injured was an ordinary incident of the 'use' of Mr Van Den Dungen's tipper truck.
For these reasons, Foster J found that Mr Van Den Dungen's employer was indemnified under the statutory compulsory third party policy issued by IAL against liability to Mr Van Den Dungen for damages. Accordingly, both the workers' compensation policy issued by Allianz and the motor vehicle third party policy issued by IAL were engaged and the principles of double insurance applied.
Comment
Foster J's findings were influenced by the wide meaning of the CTP indemnity clause set out in s54(1)(b) of the Motor Traffic Act 1936 ('Act') which referred to an injury 'caused by or arising out of the use' of the tipper truck. In particular, the use of the words 'caused by' connote a 'direct' or 'proximate' relationship of cause and effect, whereas 'arising out of' is taken to require a less proximate relationship of the injury to the relevant use of the vehicle.
This is in contrast with the narrower CTP indemnity clause contained within legislation enacted in say Queensland or New South Wales.
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