In the recent decision of Grima v RFI (Aust) Pty Ltd
 NSWCA 345, the New South Wales Court of Appeal increased the
contribution of a principal contractor toward an award of damages
to a contractor's employee from 50 percent to 75 percent.
In this Alert, Senior Associate Brooke Jacobs and Solicitor
Elizabeth Harvey discuss the implications of this case for
The plaintiff, Mr Grima, was employed by Allied Overnight
Express Pty Ltd (Allied) as a storeman. On 8 March
2010 he and a co-worker were unloading a delivery truck of carpet
underlay received from RFI (Aust) Pty Ltd (RFI).
Mr Grima was injured when two of the rolls of carpet underlay fell
out of the truck and struck him.
To save money on deliveries, RFI would utilise all the available
space in the delivery truck, stacking rolls of carpet underlay both
vertically and horizontally in the truck. The delivery truck had
five metal braces in place to secure the load (the vertical and
horizontal rolls). On the date of injury, RFI had only secured
three of the five braces. This represented a complete departure
from RFI's standard practice and was directly causative of the
Mr Grima brought a claim for damages in negligence against RFI
under the Civil Liability Act (NSW) 2002. RFI
cross-claimed against Allied, alleging that Mr Grima's injury
was also caused by its negligence as his employer.
Damages payable by RFI to Mr Grima were assessed under the
Civil Liability Act (NSW) 2002 at $5.75 million. In
contrast, under the Workers' Compensation Act (NSW)
1987, the damages payable by Allied to Mr Grima were assessed at
The trial judge found RFI and Allied equally at fault and
apportioned their responsibility for the injuries in the ratio of
50 percent each.
Mr Grima appealed this decision, seeking to maximise RFI's
responsibility for the incident, and therefore reduce the
percentage of damages restricted by the Workers'
Compensation Act (NSW) 1987.
RFI cross-appealed, seeking to reduce its share of the
The Court of Appeal found that liability should be apportioned
75 percent to RFI and 25 percent to Allied.
The Court agreed that Allied had some element of responsibility
for Mr Grima's injury. This was because Allied's system of
inspection with respect to the delivery of loads only required
workers to check for loose rolls of underlay visible from the
ground level. The Court accepted that a proper system of inspection
would have mandated inspecting the load from a higher vantage
point, to ensure an adequate view of the top of the load. Such a
system would have enabled Allied's workers to identify the risk
posed by only three of five braces being in place prior to
attempting to unload the delivery.
The Court accepted that RFI's failure to restrain the
horizontal rolls of underlay with the fifth brace was of
significantly greater importance in causing the incident than
Allied's deficient system of inspection. In failing to ensure
that the five braces were in place, RFI created a hidden
risk of injury. In the circumstances, the Court found that it
was plainly unreasonable to find that RFI and Allied were
equally responsible and apportioned 75 percent of the liability
This case is another example of a principal being liable for a
contractor's employee's injury, in this case the principal
in fact facing a greater exposure than the employer;
The fact that employers owe a high standard of care to workers
does not necessarily translate into employers facing a greater
liability exposure than principals;
A principal can be liable for injury, even if suffered within
the sphere of a contractor's expertise, in circumstances where
the principal has "control" over the system of work;
We question whether the result would have been different if
there was not the (substantial) constraint on the assessment of Mr
Grima's damages under the Workers' Compensation
Act (NSW) 1987;
We have recently reviewed the decision in Gary Bennett v Baiada Poultry, where a principal was
also found liable for injury caused to a subcontractor unloading a
delivery truck. In that case no responsibility for the injury was
attributed to the employer
Contractors and principals should ensure they have appropriate insurance coverage instead of relying on indemnity clauses.
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