New South Wales Supreme Court CITATION : MMI V ZURICH [2000] NSWSC 449 CURRENT JURISDICTION: Equity FILE NUMBER(S) : SC 1504 of 1999 HEARING DATE(S) : 18 May 2000 JUDGMENT DATE : 18 May 2000 PARTIES : Mercantile Mutual Insurance (NSW Workers' Compensation) Limited (Plaintiff) Zurich Australian Insurance Limited (Defendant) JUDGMENT OF : Windeyer J at 1 COUNSEL : Mr P.J. O'Connor (Plaintiff) Mr D. Feller (Defendant) SOLICITORS : McCullough & Buggy (Plaintiff) Vardanega Roberts (Defendant) CATCHWORDS : EQUITY - contribution - fault - claim for contribution between insured employer's indemnity insurers seeking contribution from Motor Accidents Act insurer - no evidence of fault giving rise to right of indemnity under MAA policy LEGISLATION CITED : Motor Accidents Act 1988 Workers Compensation Act 1987 CASES CITED : NRMA Insurance Limited v New South Wales Grain Corporation 1995 22 MVR 317 DECISION : See paragraph 13 1 IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION WINDEYER J THURSDAY 18 MAY 2000 1504/99 MERCANTILE MUTUAL INSURANCE (NSW WORKERS' COMPENSATION) LIMITED v ZURICH AUSTRALIAN INSURANCE LIMITED JUDGMENT 1 HIS HONOUR: This is a claim for contribution. The plaintiff insured a company, Harris Park Transport Company Pty Limited, against liability to its employees and issued a policy under the Workers Compensation Act 1987 to indemnify that employer in respect of that liability. The defendant company, Zurich Australian Insurance Limited, issued what is generally called a third party policy under the Motor Accidents Act 1988: Indemnifying the employer against liability in respect of the death or injury to a person caused by the fault of the owner or driver of the vehicle in the use or operation of the vehicle in any part of the Commonwealth, whether or not on a public street. 2 Mr Gerion was employed by Harris Park as a bus driver. On 28 July 1994 he was injured during the course of his employment. He brought proceedings in this court which were subsequently transferred to the District Court of New South Wales, claiming damages against his employer. 3 The plaintiff insurer indemnified or agreed to indemnify Harris Park in respect of any liability for the claim of Mr Gerion and assumed the conduct of the District Court proceedings. Those proceedings were settled for a sum of $210,000, including costs. The defendant in these proceedings (Zurich) agreed that the amount of the settlement was reasonable but otherwise made no concession. The plaintiff workers' compensation insurer claims that the injury to Mr Gerion occurred as a result of the fault of Harris Park in the use or operation of the vehicle which Mr Gerion was employed by Harris Park to drive, that vehicle being a motor omnibus. 4 By the summons filed originally in the Common Law Division on 7 August 1998, the plaintiff seeks a declaration that Zurich is liable to indemnify Harris Park in respect of its liability to Gerion for the injuries he sustained and an order that Zurich pay to the plaintiff, (Mercantile Mutual), the sum of $105,000. 5 It is accepted that the summons does not articulate properly what is claimed and this is the reason the proceedings were transferred to the Equity Division. The true claim is for contribution by one insurer from another insurer on the basis both were liable to Harris Park in respect of the same claim. 6 The first question to be decided, as was pointed out by Clarke J in NRMA Insurance Limited v New South Wales Grain Corporation 1995 22 MVR 317 at 318, is whether it has been established that the owner was at fault. In this case it would need to be established that Harris Park was negligent and breached a duty of care to Mr Gerion resulting in damage to him. While this is not in evidence, it is clear enough that what would have to be established would be some failure to provide Mr Gerion with a safe system of work or some other basis on which an employer is liable in damages for an injury to an employee. The only evidence relevant to this is that which appears in the affidavit of Mr Gerion sworn 2 February 2000 and an addition to that which was put in evidence by agreement. 7 Mr Gerion said that he was employed as a bus driver. He was at work on 28 July 1994 for the purpose of carrying out his employment. He went, in the early morning, to the premises of Harris Park at 43 Murray Farm Road, Carlingford. The bus which he was required to drive was parked on the lower level of two levels, presumably used for parking, those levels being separated by an embankment. There was a driveway leading from the lower to the upper level. His duties as a bus driver included preparing the bus that he was to drive. In winter months, this being a winter month, there was often heavy dew and frost on the windows of the bus which needed to be cleared off before the bus could be safely driven. He entered the bus and turned on the engine. He turned on the windscreen wipers but they did not work because they had been frozen to the windshield. 8 Mr Gerion drove the bus, with his head out because he could not see through the windshield, to the bottom of the embankment. He got out of the bus and moved to the top of the embankment where there was a hose, intending to hose down the windows. While he was hosing the front windows, he lost his footing and slipped, sustaining injuries. It was as a result of those injuries that he brought proceedings against Harris Park which were the subject of the settlement in the District Court. 9 While it is not established, I think it can be accepted that Mercantile Mutual has paid to Mr Gerion the amount of the judgment which he was awarded against Harris Park, pursuant to its liability to do so under the Workers' Compensation insurance policy. 10 The question then is whether, on those facts alone, the court can be satisfied that fault on the part of Harris Park has been established. It is clear that no estoppel arises as against Zurich as a result of the judgment by consent in the District Court. 11 It was put that there was no requirement for evidence or expert evidence as to what might be described as an unsafe system of work in the hosing down area, perhaps due to it being an unsafe place or that safe facilities were not provided for that work. However, the only evidence that there is, is that Mr Gerion, while hosing down the front window of the bus, lost his footing and slipped, suffering injuries. That, in itself, is no evidence of fault of the employer. 12 On that basis then it has not been established, so far as these proceedings are concerned, that Mr Gerion would have succeeded in a claim against his employer in respect of the use of the motor vehicle and therefore the application for contribution should be dismissed. I should say that, even if the fact of the verdict in the District Court had some other significance, a Workers' Compensation insurer has reasons for settling a claim brought by an employee which have no relevance whatsoever to a claim brought in respect of what might be described as a third party matter. In those circumstances, as the first requirement which the plaintiff would need to establish in order to succeed has not been established, the summons should be dismissed. In those circumstances, it is not necessary to consider the question of whether or not it has been established that there was fault of Harris Park in the use of the vehicle on the basis that use extends to maintenance of the vehicle. 13 I order that the summons be dismissed. Plaintiff to pay the defendant's costs. Last Modified: 09/25/2000 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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