A case with everything…

27 August 2009 Topics: Insurance

Contribution, Apportionment, Evidentiary Issues and Contributory Negligence

Miles v Zurich Australia Insurance Limited; Ace-Semi Trailer Sales Pty Ltd v Zurich Australia Insurance Limited [2008] NSWSC 1311

This is an interesting New South Wales Supreme Court decision which considers many issues that typically arise in the average WorkCover claim today.

Facts

On 10 July 2002, the Plaintiff was rendered a paraplegic when a trailer upon which he was working fell onto him. The total agreed damages were in excess of $4m. The matter proceeded on the issue of liability only.

The Plaintiff brought proceedings against Zurich Australia Insurance limited (Zurich), which was the public liability insurer of PJS Fabrications Pty Ltd (PJS). Zurich cross-claimed against Ace-Semi Trailer Sales Pty Ltd (Ace), which was the Plaintiff’s employer.

Mr Beeck was the managing director and owner of Ace. He was primarily concerned with obtaining business for the company and sales. Mr Scott’s company was PJS, and he was taken on as a sub-contractor to Ace. Mr Scott performed the function of a workshop manager for Ace, which involved day to day running of the workshop.

On the day of the accident, Mr Scott directed the Plaintiff to perform service and repair work on a trailer. The Plaintiff argued that Mr Scott’s capacity as workshop manager gave rise to PJS owing him a duty of care. That duty was breached when PJS set up an unsafe system of work, which caused the accident.

Findings

The Plaintiff’s evidence was preferred over Mr Scott’s evidence in relation to the circumstances of the accident, as he was found to be a reliable and truthful witness due to his willingness to give evidence against his interest.

The Court accepted that PJS, through its servant Mr Scott, owed the Plaintiff a duty of care, which was breached. Based on the non-delegable nature of the duty of care owed by Ace to the Plaintiff, the negligence of PJS became the negligence of Ace. Accordingly, liability was established against both Ace and PJS.

It was found that Mr Beeck had no direct knowledge of the system of work and the actual danger to which the Plaintiff was exposed. Due to Mr Scott’s position of advantage and the fact that he devised and implemented the system of work, the Court held that greater culpability should be attributed to him, and therefore to PJS, for the Plaintiff’s injuries. The Court apportioned responsibility for the Plaintiff’s injuries, 65% against PJS and 35% against Ace.

The Court did not consider it was one of those cases where a worker had been injured by an act of carelessness for their own safety that was incidental to the performance of his duties. Accordingly, contributory negligence was not established, despite the Plaintiff’s knowledge that the system of work was unsafe.

Comments

This decision is an important reminder about the non-delegable duty of care which will inevitably expose an employer to liability, even where it has little to no involvement in the employment relationship. It is also important to be aware of the consequences for a party who has direct knowledge of, and participates in, the implementation of a defective system of work.

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