New South Wales Court of Appeal CITATION : Henderson Civil Engineering Pty Ltd v Gilbarco Australia Pty Ltd [2001] NSWCA 21 FILE NUMBER(S) : CA 40793/99 HEARING DATE(S) : 5th February 2001 JUDGMENT DATE : 26 February 2001 PARTIES : Henderson Civil Engineering Pty Limited Gilbarco Australia Pty Limited JUDGMENT OF : Priestley JA at 1; Beazley JA at 2; Ipp AJA at 28 LOWER COURT JURISDICTION : District Court LOWER COURT 1296/98 FILE NUMBER(S) : LOWER COURT Robison DCJ JUDICIAL OFFICER : COUNSEL : Appellant: L King SC/M Jenkins Respondent: P M Hall QC SOLICITORS : Appellant: William K Chambers Respondent: Riley Gray-Spencer CATCHWORDS : Workers Compensation - indemnity of employer - causation - cause of accident LEGISLATION CITED : Workers Compensation Act (NSW) 1987, ss 66, 67, 151Z DECISION : Appeal dismissed with costs THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40793/99 DC 1296/98 PRIESTLEY JA BEAZLEY JA IPP AJA Monday, 26 February 2001 HENDERSON CIVIL ENGINEERING PTY LIMITED v GILBARCO AUSTRALIA LIMITED JUDGMENT 1 PRIESTLEY JA: I agree with Beazley JA. 2 BEAZLEY JA: The appellant (Henderson) conducts a civil engineering and construction business, during the course of which it hires out excavation machinery, together with the services of employees who are experienced machine operators. A Mr Walker was such an employee. 3 On 22 June 1992, Henderson had hired out one of its excavators and the services of Mr Walker for the purposes of excavation work required by the respondent (Gilbarco), which at that time was installing fuel tanks on a building site known as the Westy Service Station at Wallsend. In the course of undertaking work at the site, Mr Walker was seriously injured when the excavator toppled into a hole which he had excavated. 4 Mr Walker was paid workers' compensation by Henderson, as well as lump sum compensation under ss 66 and 67 of the Workers Compensation Act 1987 (NSW) (the Act). 5 Henderson brought proceedings against Gilbarco for indemnity under s 151Z of the Act. That section provides that where a worker receives an injury and is entitled to be paid compensation under the Act in circumstances creating liability in another person, the employer is entitled to indemnity from that person: s 151Z(1)(d). In order to succeed on its claim for indemnity, therefore, Henderson had to prove that Gilbarco owed and breached a duty of care to Mr Walker. 6 Both in the way it formulated the claim in the pleadings and ran the case at trial, Henderson alleged that the ground beneath the excavating machine collapsed causing it to topple into the hole causing Mr Walker to sustain serious injuries. It alleged that Gilbarco was under a duty of care to Mr Walker to ensure the ground upon which he was required to work was stable and was negligent in failing to do so or in directing him to work upon ground that was unstable. 7 Henderson's claim failed before the trial judge. His Honour was not satisfied the accident was caused by the ground underneath the excavator collapsing. His Honour added that even if that was established as the cause of the accident, he considered that, "that of itself … [was] not capable of establishing liability as between Mr Walker and [Gilbarco]". 8 These findings are in issue on the appeal. Evidence as to the Cause of the Accident 9 As Mr Walker understood his job, when he arrived at the site, it was to excavate an area of land to enable a petrol tank to be installed. He described the soil he was working on as "reclaimed" or "built up" land which he said was softer than land which had not been built up. Mr Walker commenced excavation of an area of land as directed by Gilbarco's foreman, Mr Anno. 10 However, two unexpected things happened. First, after the excavation commenced, a tank was discovered close to the site initially chosen. A second site therefore had to be excavated. 11 Secondly, having excavated the second site, Mr Walker was directed by Gilbarco's foreman to lift the tank into place, using the excavator. Mr Walker said he had not expected that he would have to do that task. Rather he had expected the lifting would be carried out by the use of a crane. 12 Notwithstanding that Mr Walker had not expected to undertake any lifting, he was experienced in doing so and followed the direction. He did this from what he described as the "high side" of the excavation where the tank was located. He had carried out the digging from the low side - that being the appropriate and safe side to carry out that work. He had placed the loose soil he had excavated along the lip of the low side of the excavation. That was usual procedure. However, the pile of soil would have prevented him lifting from that side. Mr Walker also said he did not think the length of the sling on the tank would have allowed him to lift from that side. 13 Mr Walker undertook the first lift without any problem. The foreman then realised that the installation specifications required the tank to be placed on a layer of sand and that had not been done. He was directed to remove the tank and then to reinstall it after the sand had been laid down. It was during the course of the second lift that the accident occurred. 14 Having carried out the second excavation he then carried out the lift. He said that when "tracking up with the sand" he felt a "little give" under the tracks of the excavator. He also said that he made his own decisions as to how to excavate and how to lift. He said that the front tracks were about a metre from the edge of the hole. 15 He then described the accident (32-33 pink): "A … [Gilbarco's foreman] was directing me to pick it up, I picked it up, I slew it around and that's when it all happened. From then on it's more of a panic and my memory when I got hurt, and that was it. … … it just felt like everything was sort of turning on me. … Q Are you able to say how the machine moved at all in the process? A I'd say that when I've slung the second time, to me it felt like the ground below me - track closest to the trench had just give, like the ground has just give and then that's just give us that momentum and it was sort of like to me like a judo throw … … Q In relation to the machine itself, up to the point that you felt this sensation of giving way, had you noticed anything unusual about the machine at all? A No not really. … Q Did you have any trouble on either the first occasion or the second occasion in lifting the tank, the load? A No, it was sweet." 16 The initial explanation as to the cause of the accident was made by Mr Walker in his claim form for workers compensation in these terms: "EXCAVATING HOLE FOR TANK. LOWERING TANK INTO HOLE, WHILST MOVING TOWARDS HOLE, BOOM SHIFTED OUTWARDS, CAUSING OVERBALANCE OF MACHINE INTO HOLE, THROWING ME OUT OF DOOR, INTO HOLE, EXCAVATOR FELL ON TOP OF ME." 17 The claim form was countersigned by Mr Henderson, principal of the appellant company. 18 Although Mr Walker had not expected to be directed to do the lifting and installation of the tank, Mr Henderson had understood that the job involved a lift of 1,500 kilograms and he had advised Gilbarco that the excavator was capable of undertaking the lift provided that the site was reasonably level and the load would not be at the maximum reach of the machine. 19 Mr Henderson attended the scene of the accident within about an hour of its occurrence. He inspected the excavated hole and observed there was a layer of clay about half a metre thick overlying approximately 2 metres of sand. He was asked: "Q … based on your experience as an engineer and based upon your experience in the engineering and constructing industry, and based upon the various courses of study that you have undertaken … are you able to express an opinion … as to whether it was safe or otherwise? A I think to be very close to the edge would be unsafe. … A I mean within a metre and a half. … Q That combination of clay and sand, is that a particular combination which is unsafe, in your experience? A In my opinion, yeah. … Q … are you able to say on the basis of your expertise and experience whether the unsafe nature of the composition of the materials comprising the earth was such as could cause the nature of the accident which you saw? A Yes. Q And in your experience and given your expertise, from what you know of the occasion of the accident, what do you believe was the reason for the machine tipping over? A I believe the pressure under the, particularly the left track had been more than the ground could support and that the ground under that left track had collapsed, causing the machine to tip forward." 20 Significantly, Mr Henderson did not say that he made any observation as to whether the ground under the excavator had given way or whether there had been any slip of soil where the excavator fell into the hole. There was no questions asked and no evidence given of either of these matters. He was also not asked whether, if there was any giving way of the soil under the tracks, it would have been observable. These were major omissions. The Court cannot assume they were accidental. But even if that was the case, the fact remains there was no contemporaneous evidence that the ground did give way. The Trial Judge's Findings 21 The trial judge correctly formulated the issue he was required to determine when he said: "I need to be satisfied, on the balance of probabilities … that the accident occurred in the way it was alleged in the statement of claim. It is important to bear that in mind when considering the evidence overall. … the plaintiff [must] satisfy me on the balance of probabilities, that the accident indeed occurred as a result of the ground giving way." 22 His Honour noted Mr Walker's evidence: "about the ground giving way or the sensation that he felt immediately prior to the incident occurring. That is also a possibility. There is really no further evidence about that, although, I would accept that the machine that Mr Walker was engaged on was also relatively close to the hole, in other words, one to one and [a] half metres from the edge. Perhaps he was too close to the edge. I do not know." 23 The last comment indicates that his Honour considered operator error was a possible cause of the accident. His Honour also considered mechanical failure to be a possible explanation for the accident, even though Henderson had had the machine tested after the accident and it was found to be operating according to specification. 24 In my opinion, it was open to his Honour to conclude that Henderson had not proved on the requisite standard that the ground giving way was the cause of the accident. This had to be proved in the way Henderson ran its case. On this ground alone, therefore, the appeal fails. 25 I should add two things. First, I consider that his Honour's view that causation in law was not proved was most probably correct, although it is not necessary to reach any concluded view on it. 26 Secondly, as I propose the appeal be dismissed, it is unnecessary to consider the issues raised in Gilbarco's Notice of Contention in relation to contributory negligence and certain other aspects of s 151Z. 27 I would propose the following orders: (i) Appeal dismissed; (ii) The appellant to pay the respondent's costs of the appeal. 28 IPP AJA: I agree with the orders proposed by Beazley JA and with her Honour's reasons. ************* DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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