NSW INSURANCE MINISTERIAL CORPORATION v HANDFORD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MEAGHER, HANDLEY and SHELLER JJA 26 October 1994, 22 November 1994 [1994] NSWCA 243 "CAUSED BY OR AROSE OUT OF THE USE OF A MOTOR VEHICLE" — REPAIR — MOTOR VEHICLE (THIRD PARTY) INSURANCE ACT 1942 — LIABILITY OF THIRD PARTY INSURER FACTS: H was requested by L to repair the cabin of a vehicle in which there were controls for operating a tipper tray. It became necessary to tip the tray to effect the repairs. The mechanism was faulty and the tray collapsed, and the worker was injured when he jumped aside. For the purposes of the legislation governing third party insurance it was held by Studdert J that the injuries "were caused by or arose out of the use of the vehicle". The insurer appealed. HELD: (1) The incident, and the steps taken to raise the tipper tray, did constitute the "use of a motor vehicle". Repair can also involve use and this was the case here, especially as the tipper was being used during repairs to the cabin, not the tipper. The situation is analogous to a parked car breaking loose because the brake fails or is left off, here the tipper control failed while performing its ordinary function. Harvey Trinder (NSW) Pty Ltd v Government Insurance Office of New South Wales (1966) 114 CLR 449 distinguished. Meagher JA This is an appeal by NSW Insurance Ministerial Corporation (aka GIO) against Mr Handford in respect of a verdict of $224,158.42 awarded against it by Studdert J. Mr Handford was requested by Mr Lewis, who owned a tipper truck, to repair the cabin of the vehicle. On first inspection, the pin mechanism securing the cabin seemed to Mr Handford to be broken. He realised that to repair the cabin he would have to elevate the tipper tray. He therefore raised the tray to an elevated position. This involved starting the vehicle's engine, depressing the clutch, operating the control in the cabin to pull the power take off mechanism into gear, and moving the control valve lever for the hydraulic arm, also located in the cabin, to the forward position. If the hydraulic system in the truck had been functioning properly, the control valve lever should have kept the tipper tray elevated. Mr Handford then climbed to the chassis level to inspect the damaged cabin pin, when the tray collapsed. He jumped aside and was injured, because the hydraulic system was not working. His Honour, after a careful review of the facts (many of which were in dispute), concluded (a) that Mr Lewis was negligent (with Mr Handford being guilty of contributory negligence), (b) that Mr Handford had suffered injury, and (c) that the appellant, as Mr Lewis's third party insurer, was liable in damages, since Mr Handford's injuries "were caused by or arose out of the use of the vehicle." The appellant has challenged finding (c), but not findings (a) or (b). His Honour found that in the circumstances, the steps taken to raise the tipper tray constituted the "use of a motor vehicle". With respect, I agree. Indeed, I would, for my part, be content to adopt his Honour's reasons as the reasons of 2 UNREPORTED JUDGMENTS this Court. However, in view of the earnest and thoughtful submissions of Mr Barry QC, senior counsel for the appellant, a little more need be said. Mr Barry took as his starting point the celebrated observation of Dixon CJ in Government Insurance Office of New South Wales v King (1960-61) 104 CLR 93 at 96: "But there is in my opinion a distinction between using a car and putting it in order for some subsequent use" But that single sentence - although it appeared in a case which has given the narrowest interpretation to the expression "caused by or arose out of the use of a motor vehicle" - is not representative of the reasoning of the Court, in that case, which recognizes that many situations involving the repair of a vehicle also involve the "use" of the vehicle. In any event, subsequent cases have emphasized that the expression is to be interpreted according to "broad and practical conceptions": see for example, the decision of the High Court in Government Insurance Office of New South Wales v Green & Lloyd Pty Ltd (1965-66) 114 CLR 437 and Commercial & General Insurance Co Ltd v Government Insurance Office of New South Wales (1972-73) 129 CLR 374. On the uncontraverted findings of his Honour, the injury was caused by the unexpected collapse of the tipping tray, which had been elevated; the elevation of the tipping tray was a use for which the tray was designed - even if no tipping was involved; the repairs which it was contemplated would be effected were repairs to the cabin, not the tipping tray; and the case was, therefore, not one where the tipping tray was being repaired rather than used. Another way of testing the legal position is this: it is generally recognized, and certainly was by both parties to this appeal, that if a parked motor vehicle breaks lose and injures somebody, that injury is, relevantly, caused by the "use" of the vehicle and therefore within the third party cover. In the present case, the keeping of the valve lever in forward position is the equivalent of keeping a brake on in a parked car; and the resulting injury must be equally within the cover. Finally, I should not omit to mention that the appellant placed some reliance on the High Court decision of Harvey Trinder (NSW) Pty Ltd v Government Insurance Office of New South Wales (1966) 114 CLR 449. This rather cryptic authority does not, it seems to me, lay down any principle, nor is it entirely easy to comprehend. It is best regarded as authority only for other cases which present identical facts. In my view the appeal ought to be dismissed with costs. Handley JA In this appeal I have had the benefit of reading in draft form the reasons for judgment of Meagher JA. There is therefore no need for me to recapitulate the facts. The appellant submitted that the plaintiff's injuries arose out of the repair and not the use of the vehicle. In GIO v King (1960) 104 CLR 93 Dixon CJ said at 96:- "... there is in my opinion a distinction between using a car and putting it in order for some subsequent use." However some actions involved in putting a vehicle in order for subsequent use also involve its use. Dixon CJ at 96 said that the distinction he had drawn:- "\.. may sometimes be difficult to apply because so many things are incidental to or arise out of the present use of a motor vehicle which if isolated from the circumstance might look as if the use of the vehicle had been abandoned or suspended for the purpose of repairing or adjusting it. But it must always be kept in mind that all the incidents attending the actual use of a vehicle form part of its use." Menzies J said at 100:- URJ NSW INSURANCE MINISTERIAL CORPORATION v HANDFORD (Handley JA) — 3 ".,.. the greaser who is crushed by the car when a power hoist supporting it fails... (does) not suffer bodily caused by or arising out of the use of the motor vehicle that is being... serviced. There is, I think, in general a clear distinction... between using a motor vehicle and working upon it. To make a car ready for use is not to use it... When repairing a car involves driving it, then while it is being driven there is both work upon the car and use of the car. The compulsory motor vehicle policy would therefore cover injuries caused by a vehicle which was being driven within a repair or servicing shop to position it over a hoist or service pits. Such injuries would arise out of the repair or servicing of the vehicle but would also arise out of its use. Some other principles are now also well established. A vehicle may be in use although it is stationary. GIO v R J Green and Lloyd Pty Ltd (1966) 114 CLR 437 at 442. Where a vehicle incorporates industrial plant such as an overhead loader, crane or air compressor, injuries caused by or arising out of the use of such plant are also within the policy. Nor does it matter that the accident occurs on private property. See Fawcett v BHP By-Products Pty Ltd (1960) 104 CLR 80, Commercial and General Insurance v GIO (1973) 129 CLR 374, SGIO v Stephens Bros Pty Ltd (1984) 154 CLR 552. Moreover cover under the policy is not limited to injuries caused by or arising out of the negligent use of the vehicle. As Barwick CJ said in GIO v R J Green & Lloyd Pty Ltd (above) at 444:- "The Act does not evidence any intention to limit the injury against the liability for which the insured is to be indemnified to injury caused by or arising out of a negligent use of the motor vehicle... It is the injury which must be caused or arise out of the use, not the liability for the injury." The appellant therefore is not assisted by the fact that the insured's negligence lay in his failure to warn the plaintiff about the earlier accident and the damage it may have caused to the hydraulic system which operated the tipper tray. Some difficulty is occasioned by the decision in Harvey Trinder Pty Ltd v GIO (1966) 114 CLR 449. There the injury was caused by the failure of a steel rope being used to fell a tree during land clearing operations. One end of that rope was around the tree and the other was linked to a rope attached to a pulley block attached to another rope attached to another pulley block, attached to a further rope connected to a winch on the insured vehicle. The power take-off was being used to drive the winch. The vehicle itself was immobilised by being attached to another tree. The claim in that case for contribution from the motor vehicle insurer failed in all courts and before all judges (1964) 82 WN (Ptl) (NSW) 201 (Jacobs J); (1965) 66 SR (NSW) 107 (F C) and (1966) 114 CLR 449. However, with respect, the ratio of the decision in the High Court remains obscure because the Justices, in their ex tempore reasons, merely stated that the injury caused to the worker when the rope failed did not arise out of the use of the vehicle. The decision cannot be explained on the ground that the accident occurred on private property, that the vehicle was stationary and had been immobilised, or that the accident arose out of the use of machinery attached to the vehicle. However some assistance can be gained, I think, from the judgment of Manning J in the Full Court which, unlike the judgments of Sugerman and Walsh JJ was not disapproved in the High Court. He pointed out that by the use of the two pulleys "the tension on the rope attached to the tree was many times the tension that could have been produced by winding the rope directly onto the drum." (114) The Judge added:- 4 UNREPORTED JUDGMENTS "\.. the mere use of a motor vehicle for the purpose of supplying power to some mechanical or other equipment is by no mean decisive. For example, if in a shearing shed, the shearing machine is supplied by power drawn from the power take-off of a tractor, and a shearer suffers injury because of some defect in one of the heads of a shearing cutter, it would be futile to suggest that the accident was caused by or arose out of the use of the tractor. In this case, while it is true that the power was not used to cause mechanical equipment to function, it was used to create a tension which was then magnified by the use of the pulleys and ropes mentioned and the sling rope which was attached to the tree. The injuries suffered by the employee in this case were caused by a fault in the ropes and their attachments to which the power was applied." It seems to me that that decision can best be explained as depending on the view that the injury caused when the rope furthest from the drum of the winch parted under the strain did not arise out of the use of the vehicle, but out of the use of the pulley blocks and ropes, particularly the rope that failed. The case so understood does not assist the appellant. I agree with Meagher JA that the relevant analogy in the present case is that of a parked car which injures someone when its brakes fail and it moves under the influence of gravity. In the present case the tipping tray had been moved into the elevated position and the hydraulic system which normally operated as a brake to maintain the tray in that position failed, causing the injuries to the respondent. The case closest on its facts is Clement v Clement (1984) 1 MVR 435. Foster J there held that the driving of the motor vehicle to the position on the driveway where the defendant intended to grease it contributed to the slipping of the jack and the movement of the vehicle which caused the plaintiff's injuries. At 442 his Honour accepted the submission for the plaintiff that:- "\.. the driving of the vehicle and its positioning in this way was relevantly a use of the vehicle from which the plaintiff's injuries, in substantial measure, arose." His Honour followed the decision in Lamont v Motor Accidents Board (1983) VR 88 where the plaintiff was injured when his bicycle collided with a parked vehicle. Tadgell J held that the rider's injuries were caused by, or arose out of the use of the parked motor vehicle because "the injuries would not have been sustained as they were had it not been for the fact that the car had been brought in the course of its ordinary user to the place where it was at the time of the accident." In my respectful opinion these cases were correctly decided. The plaintiff s injuries in the present case arose out of the use of the tipper truck because the raising of the table-top to its elevated position involved a use of the vehicle and the positioning of the table-top in this way was a contributory cause of the plaintiffs injuries. The raising of the table top as such was no different from the operations of the plant on stationary vehicles held to involve a use of the vehicles in Fawcett v BHP By-Products and Commercial and General Insurance v GIO (above). The operation of the lifting mechanism on this truck for the purpose of discharging a load, or thereafter to return the table top to its normal position would clearly be a use of the vehicle having regard to those authorities. The same operations when carried out for the purpose of inspecting or repairing the vehicle. also involve its use, just as driving and parking the vehicle for the purpose of repairing or servicing it involves such use. In my opinion the appeal should be dismissed with costs. URJ NSW INSURANCE MINISTERIAL CORPORATION v HANDFORD (Sheller JA) 5 Sheller JA I have had the benefit of reading the judgments prepared by Meagher and Handley JJA. For the reasons given by their Honours I agree that the appeal should be dismissed with costs. 5 (1) Appeal dismissed with costs. Counsel for the appellant: C Barry QC/H G Shore Solicitors for the appellant: G M Meadows 10 Counsel for the respondent: R Leatherbarrow/D K Jordan Solicitors for the respondent: Stacks