(Re: Kevin Joseph Horsell) University of New South Wales v AAI Ltd; AAI Ltd v University of New South Wales [2013] NSWDDT 11

Dust Diseases Tribunal New South Wales Medium Neutral Citation: (Re: Kevin Joseph Horsell) University of New South Wales v AAI Ltd; AAI Ltd v University of New South Wales [2013] NSWDDT 11 Hearing dates: 2 October 2013 Decision date: 03 October 2013 Before: Finnane J Decision: See paragraph [24] Catchwords: PROCUDRE - cross claim - notice of motion seeking to appoint designated insurer in these proceedings - tribunal "functus officio" - notice of motion not appropriate way to appoint designated insurer - no dispute as to relevant insurer Legislation Cited: Workers' Compensation Act 1987 Category: Principal judgment Parties: University of New South Wales (Applicant/ Respondent) AAI Insurance Ltd (Respondent/ Applicant) Representation: GJ Parker SC (Applicant/ Respondent) JL Sharpe (Respondent/ Applicant) Moray & Agnew (Applicant/ Respondent) Kemp & Co Lawyers (Respondent/ Applicant) File Number(s): 220/13

Judgment 1It would appear to me that Mr Kevin Joseph Horsell took out a statement of claim against the University of New South Wales on 28 June 2013. He filed an affidavit on 8 July 2013 and his evidence was taken on 10 July 2013. 2A crossclaim was filed by the University of New South Wales against Amaca on 11 July 2013. An appearance was filed by Amaca on 12 July 2013. 3Verdict was given for the plaintiff against the defendant, University of New South Wales, on 19 July 2013 by consent. The University of New South Wales defended the matter itself without recourse to any insurer. Subsequently on 18 September 2013, a notice of motion was put on by the University of New South Wales seeking that AAI Ltd be appointed designated insurer for the defendant in these proceedings. That was supported by an affidavit of Stephen David TaylorJones. 4On 25 September 2013 AAI put on a notice of motion supported by an affidavit of Andrew Kemp seeking that the notice of motion filed by the University of New South Wales be dismissed as an abuse of process, alternatively that it issue a crossclaim and alternatively orders were sought for discovery and interrogatories and so on. 5The matter came before me yesterday. Both parties made oral and written submissions. Some facts are agreed and in particular that before 1 January 1981, GIO General Ltd was the insurer of the University of New South Wales. Between 1 January 1981 and 31 December 1983, National Employers Mutual Insurance Association was the insurer. Between 1 January 1984 and 31 December 1986, Vero Insurance was the insurer and between 1 January 1987 and 30 June 1987 FAI Insurance was the insurer. 6National Employers Mutual and FAI are both insolvent insurers and their liabilities are currently covered by an Insurers Guarantee Fund. The Insurers Guarantee Fund is not itself an insurer. It must follow that the only insurers as such who could be sued are GIO General and Vero Insurance. It is agreed that AAI is an amalgamation of both these insurers and that AAI has assumed the liabilities of both insurers. The amalgamation was effected by Suncorp Insurance which itself owned both the individual insurers. 7The motion by the University of New South Wales to appoint AAI refers to section 151AC of the Workers Compensation Act 1987. Section 151AC of that Act refers in its terms to section 151AB of that Act. It is necessary for this decision that I refer to both sections. 151AB(1) provides: If an employer is liable independently of this Act for damages for an occupational disease contracted by a worker the following provisions have effect for the purpose of any policy of insurance obtained by the employer. (a) the liability is taken to have arisen when the worker was last employed by the employer in employment to the nature of which the disease was due subject to para (b). (b) if the worker was employed by the employer in employment to the nature of which the disease was due both and after the relevant commencement the liability is taken to have arisen both when the worker was last employed by the employer in employment, to the nature of which the disease was due before the relevant commencement and when the worker was last employed by the employer in employment to the nature of which the disease was due after the relevant commencement. 8The relevant commencement is 30 June 1987 at 4pm. 9Subsection (2) then provides: In the case to which subs (1)(b) applies, two insurers will be liable under policies of insurance to indemnify the employer or pay damages to the worker and the following provision with respect to those insurers (referred to in this subs as the responsible insurers) apply. (a) Of the responsible insurers, the one that is the insurer in respect of the employer's liability that arose after the relevant commencement is to be the insurer primarily responsible. 10There are other provisions for agreement between the insurers and so on. 11Section 151AC has special provision for dust diseases, and in subs (1): Applies in relation to an employer who is liable independently of this Act to damages for a dust disease as defined by the Workers Compensation (Dust Diseases) Act 1942 contracted by a worker where there is a dispute as to which of two of more insurers in a category of insurers is liable to indemnify the employer under any of the provisions of s 151AB. 12It then goes on to deal with how it is to be resolved, which of two disputing insurers should be capable of being joined. 13The purpose of the legislation is clearly to permit an insured employer a simple way of joining one insurer of perhaps a number of insurers so that that insurer can then take on the running of any litigation and if it wishes to dispute with other insurers it can take advantage of the provisions as to arbitration between the insurers. 14The purpose of it obviously is to enable the employer very quickly just to pick one that qualifies and have that insurer take everything over. But for the provisions in sections 151AB and 151AC, an employer which could not persuade an insurer to accept liability would have to commence proceedings against that insurer either by way of statement of claim or if proceedings had been commenced in this Tribunal, by a crossclaim. And then the Tribunal, if proceedings were commenced here, could determine which of the insurers might be liable. 15The claim by Mr Horsell was that he had contracted mesothelioma as a result of his working with the employer as a carpenter at the University and being exposed to asbestos. He gave evidence by way of affidavit as I have said, setting out his course of employment and subsequent problems that emerged when he was found to have mesothelioma. 16A crossclaim against Amaca has not gone any further than I have already indicated and it is clear from submissions made to me yesterday that the University brought the proceedings by way of notice of motion seeking to have AAI Ltd to be appointed the designated insurer, so that AAI could take over the running of the crossclaim against Amaca. 17I have read of course the affidavit of Mr Stephen David TaylorJones and the annexures which include amongst other things, letters between firms of solicitors representing AAI and the University of New South Wales setting out their respective contentions as to the applicability of sections 151AB and AC. 18The notice of motion put on behalf of AAI very simply is based on a contention that the notice of motion is a totally inappropriate way of commencing proceedings against the University of New South Wales and should be dismissed as an abuse of process. 19Substantially the argument is put that this is a matter that should be pleaded. It is also put that the proceedings between the plaintiff and the defendant had completed and there was nothing now on foot, hence it was not appropriate to have a notice of motion, and it was said that the Tribunal is now functus officio. It is also said that what the defendant should do if it wished to bring proceedings, is to commence proceedings against AAI by crossclaim subject to the Tribunal giving leave. 20The University of New South Wales claims that the facts entitle it to have AAI appointed as the insurer and hence the notice of motion is perfectly valid. 21In my opinion, the notice of motion cannot succeed, and it cannot succeed because section 151AC provides that it applies where there is a dispute as to which of two or more insurers in a category of insurers is liable to indemnify. 22There is no dispute as such. GIO General and Vero are now effectively one insurer. They are not disputing amongst themselves anything. There are no other insurers who are disputing anything. The fund that was set up to deal with NEM and FAI's insolvency is not an insurer. It cannot be a dispute in the terms of this section between AAI and that fund, it therefore follows that section 151AC does not apply. There is no basis for me to appoint AAI as the insurer and I decline to do so. 23If the University of New South Wales wishes to commence crossclaims against AAI and the fund, it of course can do so and I give it leave to bring those proceedings if it wishes. It would then have to prove as it would have to prove where any insurer denies liability, that the insurer is liable. 24So the upshot of this is I refuse the notice of motion. I give leave to the University of New South Wales to bring proceedings by way of crossclaim against AAI Ltd and any other insurer it wishes to bring proceedings against. 25I stand over the matter for directions on 8 October. The parties should come prepared with some directions if they intend to continue. If the University of New South Wales wishes to commence proceedings, it should do so before then. 26I give leave to both parties to approach me at any time between now and then in respect of any matter that is necessary. 27I order the University of New South Wales to pay the costs of the notice of motion.