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  • Unreported Judgment

Vella's Plant Hire Pty Ltd v Mistranch Pty Ltd

 

[2012] QSC 77

Reported at [2013] 1 Qd R 152

 

SUPREME COURT OF QUEENSLAND

 

CITATION:

Vella’s Plant Hire Pty Ltd v Mistranch Pty Ltd & Ors [2012] QSC 77

PARTIES:

MATTHEW FRANK McKENZIE
(Plaintiff)
v 
VELLA’S PLANT HIRE PTY LTD
(First Defendant)
AND 
MISTRANCH PTY LTD
(Second Defendant)
AND 
GEORGE KLENOWSKI
(First Third Party)
AND 
DREAMTEA PTY LTD
(Second Third Party)

FILE NO/S:

185/2009

DIVISION:

Trial Division

PROCEEDING:

Trial

ORIGINATING COURT:

Supreme Court at Mackay

DELIVERED ON:

29 March 2012

DELIVERED AT:

Rockhampton

HEARING DATE:

19, 20 March 2012

JUDGE:

McMeekin J

ORDERS:

  1. Judgment for the second defendant and the first and second third parties against the first defendant.
  1. Order the first defendant pay the costs of the second defendant and the first and second third parties.

CATCHWORDS:

TORTS – NEGLIGENCE – ESSENTIALS OF ACTION FOR NEGLIGENCE – SPECIAL RELATIONSHIPS AND DUTIES – where employee injured in course of employment – where liability accepted – whether settlement was reasonable – whether principal is liable in damages for injuries sustained by employee of independent contractor – whether duty owed by principal to employee of independent contractor

Law Reform Act 1995 (Qld) ss 6, 7

Caltex Refineries (Qld) Pty Ltd v Stavar [2009] NSWCA 258

Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1

Ferraloro v Preston Timber Pty Ltd (1982) 56 ALJR 872

Kondis v State Transport Authority (1984) 154 CLR 672

Leighton Contractors Pty Ltd v Fox & Ors (2009) 240 CLR 1; [2009] HCA 35

McLean v Tedman (1984) 155 CLR 306

Rockdale Beef v Carey [2003] NSWCA 132

Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16

Sydney Water Corporation v Abramovic  [2007] NSWCA 248

COUNSEL:

R Morton for the First Defendant

G Crow SC for the Second Defendant and the First and Second Third Parties

SOLICITORS:

Swanwick Murray Roche Lawyers for the First Defendant

Macrossan & Amiet Solicitors for the Second Defendant and the First and Second Third Parties

  1. McMEEKIN J:  Mr Matthew McKenzie was badly injured on 23 April 2007 in the course of his employment with the first defendant, Vella’s Plant Hire Pty Ltd (“Vella’s”), when a D7G dozer that he was operating went over the edge of a steep embankment and overturned. He issued proceedings claiming damages. Vella’s accepted liability and has paid damages to Mr McKenzie of $775,000 together with costs of $25,000. Vella’s submits that those parties who engaged it to do the work on which Mr McKenzie was employed when injured and their principal, Mr George Klenowski, should also bear responsibility for the damages. I shall refer to Mr Klenowski and the second defendant and the second third party, being the two companies with which he is associated, as “the defendants”.
  1. The question therefore to be determined is whether, in the circumstances pertaining, a principal who contracts with an independent contractor is liable in damages at the suit of the contractor for injuries sustained by an employee of the contractor in carrying out the work the subject of the contract. The case was advanced on the basis of a duty owed by the principal to the employee, not to the contractor.
  1. In addition to the primary question of who should bear responsibility for the damages suffered, the defendants contend that the settlement reached with Mr McKenzie was not reasonable. It is not in issue that the onus is on Vella’s of establishing that the settlement was reasonable.[1] It is accepted that the injuries were such that an assessment of damages of $775,000 was appropriate but it was argued that the employer could have avoided primary liability and there ought to have been brought into account a substantial apportionment against Mr McKenzie which made the settlement unreasonable.

Facts Not In Issue

  1. Certain facts are not in issue:
  1. Vella’s were a well established dozer hire company and, so far as the defendants knew, employed competent operators of its equipment;
  1. Mr McKenzie was in fact an experienced and competent operator, well familiar with the machine in question;
  1. The work involved was not complicated but involved de-grassing the site to enable surveyors to carry out their work preparatory to a subdivision of the land;
  1. The de-grassing was needed on land that was relatively flat as well as land that was relatively steep. The steep land was described in evidence as steep banks and was to be de-grassed by means of an excavator, not the dozer, and was to be done at a later date;
  1. Mr McKenzie was well aware that steep banks existed on the land and well aware that the de-grassing of that land was to be performed by the excavator – he had himself carried out the work of de-grassing the steep banks with an excavator in 2005;
  1. Mr Ken Vella was Mr McKenzie’s superior, was present at the site for the start of the job, was well aware of the danger presented by the steep batter, spoke to Mr McKenzie about that, but made no arrangements to identify the location of the batter or otherwise keep Mr McKenzie safe from going over the edge of the batter. He was of the opinion that Mr McKenzie was well able to look out for himself; 
  1. The site consisted of two parcels of neighbouring land owned by two separate owners – the second third party, Dreamtea Pty Ltd on the one hand, a company of which Mr Klenowski was the director, and persons named Houwings on the other;
  1. The second defendant, Mistranch Pty Ltd, was engaged by the land holders to arrange for the de-grassing to be carried out. Mr Klenowski was a director and principal of that company;
  1. Neighbouring land was owned by the local Council and a reservoir was constructed there. Mr McKenzie knew that the land to be cleared did not include the Council land although the precise boundaries were not clearly identified on the ground for him;
  1. Telstra and Ergon Energy infrastructure was present on the site and needed to be avoided. Mr Klenowski had obtained “Dial Before you Dig Plans” from each company and provided a copy to Mr McKenzie;

(k)Mr McKenzie considered that the job was well within his competence he having operated on or in the vicinity of steeper slopes in the past without difficulty;[2]

(l)If the defendants acted at all they acted through the agency of Mr Klenowski. It is in issue whether each of the defendants was represented at the material time by Mr Klenowski. That he was acting in his capacity as director of the first defendant is admitted on the pleadings. Whether he was acting on behalf of Dreamtea Pty Ltd was not so clear;

(m)Mr Klenowski was a geotechnical engineer. He was not shown to have any qualifications to act as a dozer operator nor was it shown that he had any experience in operating such a machine or any familiarity with the safe operating limits of the machine.

  1. Mr Klenowski’s admitted involvement in the work was limited to the placing of pink tape in certain locations and the identification of where he wanted pushed grass to be put. He had discussions with Mr McKenzie about what he wanted done. The content of those discussions is in issue and I will return to that later. At the time of the accident Mr Klenowski says that he was in his vehicle and on the point of leaving the site. There is no suggestion that he was giving any directions to Mr McKenzie at that point.
  1. It is not in issue that Mr McKenzie was briefly knocked unconscious in the accident and, as I have mentioned, suffered severe injuries. Those injuries included a head injury sufficiently serious to result in the crushing of his optic nerve.

The Dispute

  1. Vella’s case is that Mr Klenowski so placed the pink tape as to lead Mr McKenzie to think that it was safe for him to push into the area where he got into difficulties and it was not in fact safe for him to go there. It was submitted[3]:
  1. Mr Klenowski directed the manner of performance of the work either by giving the direction to carry out the final push towards a fence and/or placing the pink tape where he did;
  1. Mr Klenowski had the means to alleviate the risk of the dozer going over the edge of the batter (eg by the positioning of star pickets and tape) and in the circumstances, where Mistranch Pty Ltd had been engaged to carry out the de-grassing,[4] it was reasonable to expect that he would do so; and
  1. Vella’s had not taken steps to alleviate the relevant risk and Mr Klenowski knew of that.  In those circumstances he could not ignore the risk.
  1. Mr Klenowski says that he engaged competent plant operators to do this task and left it to them to go about it as they saw fit.
  1. At the heart of the case is the question whether, in all the circumstances, a duty of care to protect Mr McKenzie from driving his dozer over the edge of the steep embankment was owed by Mr Klenowski and hence the defendants? That in turn depends on whether Mr Klenowski assumed responsibility for identifying where the edge of the steep batter was, or perhaps whether Mr McKenzie reasonably thought that Mr Klenowski had assumed that responsibility.[5]

Mr McKenzie’s Version

  1. Mr McKenzie said that Mr Klenowski asked him to clear the area right up to a fence or a corner, as he called it, in order to “get all the survey done”.[6] It was common ground that Mr Klenowski had placed pink tape on a fence surrounding the reservoir[7] and the corner to which Mr McKenzie referred was at or very near that location. Mr McKenzie understood the request to be to clear “right up to near the pink tape”.[8] Mr McKenzie’s evidence was that the request was made of him after a service truck arrived and after he had been clearing for about one and a half hours. He said in chief as follows:

“What did you talk about?   We talked about how we're going with the piles, and he said he'd also like done up to the fence, that way he could get all the survey set out.

…What did you say about that?   I said I'd rather wait till the digger got there, but I said I'll give it a bit of a go.

Well after you said you'd like to wait for the digger, did Mr Klenowski say anything?   ‘Oh, it'd be good if we could do it now 'cause that way I'd only have to get survey out once.’”[9]

  1. Mr McKenzie said that he understood that the pink tape signified where the boundaries were. In cross examination he said that he was “pretty sure” of that.[10] Despite that evidence Mr McKenzie at one point accepted that Mr Klenowski used the tape to mark infrastructure points, at least in a general sense.[11] He denied that Mr Klenowski told him that the pink tape on the fence was to mark infrastructure points, namely a pit, and that a steep batter was there.[12]
  1. He said in reference to this area that he could not see the edge of the steep batter “clearly”.[13] He appeared to accept in cross examination that he was aware that the batter was close by.[14] He said that he “backed up to the edge and then come onto the grass - the mowed grass” for the refuelling suggesting a good appreciation of the location of the edge of the batter at that point.[15]
  1. Mr McKenzie said that after he recommenced operating the dozer after the service he made one push into this area and then the overturning occurred which he described in the following terms:

“As I went up, I pushed along, and I said, "Oh, this is getting a bit steep", so I sort of come to a bit of a halt, but then I don't know whether it was when I selected reverse or not, but I just started to feel the arse of the dozer coming up like that…

 

So you're indicating an overturning motion with your arm? Yeah.

 

And what happened? That's all I can remember is it starting to go over onto its side.  I can remember hitting its - it hitting its side and then all I can remember is looking at the roof and that's all I can remember.”[16]

  1. When asked whether he had made an error Mr McKenzie said that he should never have gone “up there”.[17] He said that he “should have just stopped where I thought I was safe”.[18] The question was no doubt prompted in part by Mr McKenzie’s statement to an investigator that the accident had occurred through operator error.

Mr Klenowski’s Version

  1. Mr Klenowski denied that he made the request that Mr McKenzie spoke of. He said that he had placed the pink tape on the fence in question in order to indicate the location of a Telstra pit which is immediately adjacent and the presence of the steep batter nearby. In other locations the pink tape was used to indicate the boundaries of the land to be cleared as well as infrastructure points. He maintained that his only involvement in giving directions was to ensure that grass was not pushed into areas where it was not wanted.
  1. He disputed that the overturning occurred on the first push after the servicing of the dozer. He thought that Mr McKenzie caused the dozer to do a number of pushes, back and forth, and over much the same area, before the incident.

Credit

  1. A strong attack was made on Mr Klenowski’s credit. It is certainly true that his method of giving evidence in cross examination was to anticipate the point of attack and answer that attack rather than the question he was asked. As well a letter was written by solicitors that he engaged in Western Australia concerning the involvement of Mistranch Pty Ltd which was plainly misleading.[19] It seemed to me to be that Mr Klenowski wished to defend his position and was in that sense partisan.
  1. Despite those criticisms I am not persuaded that Mr Klenowski was actively endeavouring to mislead the Court. He was sincere in his manner. On the crucial issue of the significance of the location of the pink tape his evidence is inherently probable in many respects. It seems plain that all parties left it to him to obtain the “Dial as you Dig Plans” and that he had the responsibility of locating the infrastructure sites – certainly no-one else undertook that essential task. Given that responsibility it makes sense that he would mark the locations of such things as the Telstra pit. As well, the fence was well onto Council land and in no sense marked the boundary. Mr Klenowski, I am sure, well knew that. And he can derive considerable support from a statement made on the day of the incident and long before there was any suggestion that either he or his companies were to be sued, where he stated:

“M. McKenzie asked me if I could mark out the Telstra and Ergon lines on the upper slope. I drove up the Reservoir Road and located the Telstra and Ergon pits. I showed these to M. McKenzie when he arrived with the dozer and told him that I would mark the location of the Telstra pit and steep batter with pink flagging tape on the fence”.[20]

  1. It seems to me to be a long bow to argue that he then anticipated that he might be held liable one day for asking the dozer operator to clear the area, if that had occurred, and hence tailored his statement accordingly. I doubt that a lay person, or indeed many lawyers, would think that the making of such a request, and an experienced operator acceding to it, would expose him or her to liability.
  1. That is not to say that all that Mr Klenowski asserted ought to be accepted. His evidence of some of the conversations he says took place seems inherently unlikely. Nor am I prepared to accept his recollections of the extent of the clearing before the service break. The point, I take it, is that the greater the clearing the more obvious should have been the edge of the batter. It seems inherently improbable that Mr McKenzie would drive over an edge that he could clearly see. Further, there is no suggestion of that in Mr Klenowski’s statement that he made on the day.
  1. His account of his observations of the operation of the dozer immediately before the overturning was strongly attacked but it seemed to me that if Mr McKenzie was indeed endeavouring to “find the edge” as he said to the investigator in July 2007 then one way of doing that would be to push back and forth over much the same area with each traverse a little closer to the danger. However I see no need to make further findings on these matters as they do not impact on the resolution of the crucial issues.
  1. Mr McKenzie’s credit was attacked also, not so much on the grounds that he was dishonest but rather that he was not reliable, particularly given the head injury that he received. It was evident that Mr McKenzie’s recollections of things were at times incomplete and vague. He was unsure of his conversation with Mr Ken Vella at the start of the work that day,[21] of how he obtained the Dial as You Dig Plans,[22] where he was when he obtained those plans,[23] and whether he was directed by Mr Vella to start at the top.[24] As well it seems clear that he was not certain of how many times he pushed into the area. He told the investigator from Workplace Health & Safety that he had made a couple of pushes. When challenged on the discrepancy between that statement and his evidence he said that he “must have” made a couple of pushes.[25]
  1. Despite these concerns, in my view Mr McKenzie should be accepted in his claim that there was a conversation along the lines that Mr Klenowski wanted him to clear an area at the top of the site. He is in no position to identify the precise words used – whether the request was to go “near to”, “up to”, close to”, “over to” or even “towards” the pink tape. I find that it is more probable than not that Mr Klenowski related where he wanted cleared to the presence of the pink flag. I make these findings principally because of what I see as the probabilities and deriving no great advantage from seeing the witnesses save that it seemed patently clear that Mr McKenzie was at all times doing his best to relate what occurred. He answered questions directly. It seemed to me highly unlikely that he would make up the request. He had no financial interest in the outcome. He may wish to protect his employer – he remains employed by Vella’s – but he is surely well aware that his employer is insured.
  1. Further Mr Morton argued that the location of the pink flag on the fence only made sense if such a request was made. I think that is right. The flag is positioned well onto Council land. There was no reason to expect that Mr McKenzie would go to that area as it would have been a simple matter both to identify the area as Council land because of the presence of the fence and for him to keep well off it. Only if it was expected that Mr McKenzie might go near there was there any need to mark the location of services such as the Telstra pit.
  1. Hence the matter stands to be decided on the basis that Mr Klenowski made a request that Mr McKenzie clear in the area near to the fence, whatever the precise words used. That does not mean that Mr Klenowski did not also indicate to Mr McKenzie that the pink flag marked the location of a Telstra pit or that a steep bank was nearby. Mr McKenzie may well have forgotten this. But Mr Klenowski’s claim that he said that to Mr McKenzie has the support of his near contemporaneous statement and it is not inherently unlikely that he would say such things. To the contrary - the pit is there as was the batter and Mr Klenowski would want the operator to avoid both. What is more his claim is supported by Mr McKenzie - in his interview with the investigator in July 2007 Mr McKenzie said that in conversation with Mr Klenowski before the incident they had identified the batter and both men knew the batter was nearby. Finally Mr McKenzie’s explanation for the tape being there was not recalled by him when speaking to the investigator much closer to the time of the incident and, more cogently, is unlikely - the boundary is not at the position of the tape.

The Law

  1. The claim is brought pursuant to ss 6 and 7 of the Law Reform Act 1995 (Qld) which relevantly provide:

“6 Proceedings against, and contribution between, joint and several tortfeasors

Where damage is suffered by any person as a result of a tort (whether a crime or not) the following apply—

(c) any tortfeasor liable in respect of that damage may recover contribution from any other tortfeasor who is, or would if sued have been, liable in respect of the same damage, whether as a joint tortfeasor or otherwise, so, however, that no person shall be entitled to recover contribution under this section from any person entitled to be indemnified by the person in respect of the liability in respect of which the contribution is sought.

 

7 Amount of contribution and power of the court

In any proceedings for contribution under this division the amount of the contribution recoverable from any person shall be such as may be found by the court to be just and equitable having regard to the extent of that person’s responsibility for the damage; and the court shall have power to exempt any person from liability to make contribution, or to direct that the contribution to be recovered from any person shall amount to a complete indemnity.”

  1. The primary issue then is whether the defendants, “if sued, would have been liable in respect of the same damage” in respect of which Vella’s had accepted liability and that turns on whether any duty of care was owed by the defendants and if so whether it was breached.
  1. The starting point is that the mere fact of the existence of “the relationship between principal and independent contractor is not one which, of itself, gives rise to a common law duty of care, much less to the special duty resting on employers to ensure that care is taken”: Leighton Contractors Pty Ltd v Fox & Ors.[26] Where the relationship between the parties does not fall into a recognised category of relationship giving rise to a duty to take care to protect from harm it is necessary to resort to fundamental principles to determine whether in all the circumstances such a duty should be imposed.
  1. Of course the presence of that relationship of principal and independent contractor does not preclude such a duty arising. So much is clear from the decision of the High Court in Stevens v Brodribb Sawmilling Co Pty Ltd[27] and the remarks of the Court in Leighton Contractors where the Court referred, without criticism, to the lower Court’s acceptance of “categories of case in which it is recognised that a principal may incur liability for the tortious acts of independent contractors that it has directly authorised; for failure to co-ordinate the activities of independent contractors; and for breach of specific duties as an occupier”.[28]
  1. I observe that Mr Morton did not seek to base the first defendant’s case on a breach of the duties owed as occupier. In fact the accident did not occur on land occupied by either Dreamtea Pty Ltd or the Houwings.
  1. To the extent that the decision in Leighton Contractors provides any further guidance it can be found in the reasons for not imposing the duty that had been found to be owing by the Court of Appeal. The High Court held that a principal contractor on a busy construction site does not have imposed on it a liability to ensure that employees of sub contractors coming onto the site have induction training in a function that formed part of the essential work of the sub contractor, there concrete pumping. The reasons for not recognising such a duty lay in the principal’s lack of specialised knowledge pertinent to the trades conducted on site, a factor relevant here, and the essential distinction between the duties owed by employers and principal contractors:

“If Leighton owed a duty to Mr Fox and Mr Stewart to provide induction training to them in the safe method of line cleaning, it owed a duty to provide training in the safe method of carrying on every trade and conducting every specialised activity carried out on the site to every worker on the site. There is no reason in principle to impose a duty having this scope on a principal contractor. The latter is unlikely to possess detailed knowledge of safe work methods across the spectrum of trades involved in construction work. And a duty to provide training in the safe method of carrying out the contractor’s specialised task is inconsistent with maintenance of the distinction that the common law draws between the obligations of employers to their employees and of principals to independent contractors.”[29]

  1. The first point mentioned – the possession of detailed knowledge, and I would add expertise – is usually the very reason a contractor is employed, and that was the case here. Where the risk in question falls squarely within the risks commonly encountered within the contractor’s daily work, then I anticipate that the contractor would need to demonstrate some special circumstance justifying the imposition of a duty on the principal.
  1. The second point mentioned – “the distinction that the common law draws between the obligations of employers to their employees and of principals to independent contractors” - presents a formidable obstacle to the imposition of the duty alleged to be owing here. Here the duties that Vella’s seek to impose on the defendants are akin to those the law imposes on an employer. Indeed Mr Morton, who appeared for the first defendant, called in aid[30] cases associated with the stringent duty imposed on employers to act on the basis that an employee such as Mr McKenzie “might not act with due care for his own safety”[31] and to consider that “the obligation is not restricted ‘to the provision of a system which safeguards the employee from all foreseeable risks of injury except those that arise from his own inadvertence or negligence’”[32].
  1. While circumstances arise where a principal is under a similar obligation to that of an employer - Crimmins v Stevedoring Industry Finance Committee[33] and Rockdale Beef v Carey[34] were each cases where the principal was in a position very close to that of employer – that is not this case. The distinction between the duties owed by an employer and by an independent contractor to the employee of the employer turns on the special position of the employer to direct and control the employee: Kondis v State Transport Authority (1984) 154 CLR 672 at 687–688 per Mason J. As Hayne J noted in Crimmins v Stevedoring Industry Finance Committee:

“The common law imposes a duty on the employer because the employer is in a position to direct another to go in harm’s way and to do so in circumstances over which that employer can exercise control.”[35]

  1. Mr Morton recognised that more must be shown than the mere existence of the relationship of principal and independent contractor. He relied on a decision of the Court of Appeal in New South Wales, Sydney Water Corporation v Abramovic[36], as establishing that where one of three things can be shown a duty of care arises. There Basten JA, with whom Mason P agreed, said:

“[92]If that duty is not to arise in all cases involving independent contractors additional elements, as in Crimmins, must be established. These appear to be that:

(a)  the principal had knowledge of the risks which was not shared by the employer, or

(b)  the principal created the risk through directions given to the employer, or

(c)  the principal knew or at least ought to have known that the employer was not, or was not capable of, instituting a safe system of work.”

  1. Mr Morton submitted that all three factors were present here. I do not accept that all factors, or necessarily any in the relevant sense, are present here. But more cogently I do not accept that the statement comprehensively states the law relevant to this case.
  1. Basten JA’s remarks need to be read in context. His Honour was there attempting to identify those additional factors that previous cases had suggested would justify the imposition of a duty on a major statutory corporation, involved in ongoing and repetitive work with which it has great familiarity, and with powers to inspect and require rectification of works that it had commissioned, to insist upon the employer adopting a safe system of work. While relevant, his Honour’s remarks are not so apt to describe the position of a landholder, with no such powers or special expertise, who desires that his land be cleared, and who engages expert contractors to assist in that task.
  1. Mr Morton also referred to a later statement of Basten JA in Abramovic as helpful:

“However, the principal may also owe a duty to a worker who is an employee of an independent contractor. The legal question is to identify the criteria which must be satisfied to give rise to such a duty of care. The cases suggest that satisfaction of one of the following criteria may give rise to such a duty:

(a)the principal directs the manner of performance of the work;

(b)  the work requires the coordination of the activities of different contractors;

(c)  the principal has or ought to have knowledge of the risk and the employer does not and cannot reasonably be expected to have such knowledge;

(d)  the principal has the means to alleviate the risk and the employer cannot reasonably be expected to do so;

(e)  although the employer has or should have the relevant knowledge and can be expected reasonably to take steps to alleviate the risk, it does not, to the knowledge of the principal, do so.”[37]

  1. Basten JA was there concerned with identifying general criteria, albeit in the context of a statutory corporation with certain powers of inspection and control, and where the relevant activity involved the release of toxic or hazardous substances. As long as his Honour’s comments are read in that context, as I am sure he intended, and with the qualification that the totality of the circumstances need be considered and that one factor can assume much greater significance in one case than in another, both of which matters he recognised in the course of his reasons, I agree that his remarks are a helpful summation of the bases, or at least some of them, on which the principal of an independent contractor may, not must, be held liable to the employee of an independent contractor.
  1. Mr Morton further submitted that where the issue was whether a duty of care was owed in a novel situation the proper approach was explained by Allsop P in Caltex Refineries (Qld) Pty Ltd v Stavar[38] where his Honour noted that there was no “particular formula or methodology or test the application of which will yield an answer to the question whether there exists in any given circumstance a duty of care”  and suggested that the Court was required to “undertake a close analysis of the facts bearing on the relationship between the plaintiff and the putative tortfeasor by references to the “salient features” or factors affecting the appropriateness of imputing a legal duty to take reasonable care to avoid harm or injury” and then identified a non exhaustive list of some 17 such salient features. As a general statement of the proper approach Allsop P’s statement is, with respect, entirely appropriate.
  1. Of some significance to this case is Allsop P’s observation in Stavar that “[t]he use of an independent contractor by a principal, rather than the direct engagement of employees, is a significant factor in the existence or not of responsibility of the principal arising from the conduct or activity of the subcontractor and its employees or agents”,[39] a statement entirely consistent with the reasons in Leighton.
  1. While I recognise that Mr Morton did not seek to base the first defendant’s case on any claim of the principal bearing vicarious liability for the employer’s breach of duty to its employee it is worthwhile recalling Brennan J’s statement of principle in Stevens:

“The circumstances may make it necessary for the entrepreneur to retain and exercise a supervisory power or to prescribe the respective areas of responsibility of independent contractors if confusion about those areas involves a risk of injury. But once the activity has been organized and its operation is in the hands of independent contractors, liability for negligence by them within the area of their responsibility is not borne vicariously by the entrepreneur. If there is no failure to take reasonable care in the employment of independent contractors competent to control their own systems of work, or in not retaining a supervisory power or in leaving undefined the contractors’ respective areas of responsibility, the entrepreneur is not liable for damage caused merely by a negligent failure of an independent contractor to adopt or follow a safe system of work either within his area of responsibility or in an area of shared responsibility.”[40]

  1. In my view the statements of McHugh J and Callinan J in Crimmins on the duty question offer a useful guide to the approach to take here, albeit acknowledging the special position of a statutory authority. McHugh J said that “in a novel case where a plaintiff alleges that a statutory authority owed him or her a common law duty of care and breached that duty by failing to exercise a statutory power, the issue of duty should be determined by the following questions:
  1.   Was it reasonably foreseeable that an act or omission of the defendant, including a failure to exercise its statutory powers, would result in injury to the plaintiff or his or her interests? If no, then there is no duty.
  1.   By reason of the defendant’s statutory or assumed obligations or control, did the defendant have the power to protect a specific class including the plaintiff (rather than the public at large) from a risk of harm? If no, then there is no duty.
  1.   Was the plaintiff or were the plaintiff’s interests vulnerable in the sense that the plaintiff could not reasonably be expected to adequately safeguard himself or herself or those interests from harm? If no, then there is no duty.
  1.   Did the defendant know, or ought the defendant to have known, of the risk of harm to the specific class including the plaintiff if it did not exercise its powers? If no, then there is no duty.
  1.   Would such a duty impose liability with respect to the defendant’s exercise of ‘core policy-making’ or ‘quasi-legislative’ functions? If yes, then there is no duty.
  1.   Are there any other supervening reasons in policy to deny the existence of a duty of care (eg, the imposition of a duty is inconsistent with the statutory scheme, or the case is concerned with pure economic loss and the application of principles in that field deny the existence of a duty)? If yes, then there is no duty.”[41]
  1. Questions three and four seem particularly relevant here.
  1. While it might be said that McHugh J did not speak for the Court, Gleeson CJ agreed with McHugh J on the duty question and Gaudron J’s views were not so different particularly in her Honour’s discussion of the concept of general reliance and vulnerability in the following passage:

“[43] The notion of general reliance has been the subject of some criticism and more recent decisions of this Court have tended to focus on the vulnerability of the person who suffers injury, on the one hand, and, on the other, the knowledge of risk and the power of the party against whom a duty of care is asserted to control or minimise that risk. And those precise considerations appear to underpin the notion of general reliance as explained by Mason J in Sutherland Shire.”[42]

  1. After observing that “the duty owed by the respondent must take account of and yield to [certain statutory provisions] and other contextual indications that the Authority cannot be precisely equated with an employer” Callinan J identified the duty in the following terms:

“as a duty to take such reasonable care for the safety of Mr Crimmins in the workplace as the respondent was reasonably capable of taking as a matter of practicality in the performance of its functions, and which the actual employer could not be expected to, or did not itself have the capacity to take, or was flagrantly failing to take, in circumstances in which measures available to the respondent, if taken, would have been likely to be effective in preventing or alleviating the harm done to Mr Crimmins.[43]

  1. In summary what the cases do show is that the totality of the circumstances must be considered[44] and that the central matters of importance include the presence or extent of the power to direct or control on the part of the principal,[45] any obvious reliance on the principal,[46] and the vulnerability of the employee.[47]
  1. With those statements of principle in mind I turn to consider the salient features in this case.

Discussion

  1. A striking feature of the facts is that Mr McKenzie does not assert that the positioning of the pink tape in any way misled him, or made him think that the batter was not nearby. At no time, whether in his statements to the investigator or in his evidence to the Court, has Mr McKenzie sought to assert that anything that Mr Klenowski did or said affected his judgement of the situation. In particular he did not assert that he thought that Mr Klenowski had taken on the task of identifying for him the safe edge of the batter.
  1. A further striking feature is that of the two men Mr McKenzie was clearly in the superior position to assess the risks involved. He alone was accustomed to the machine and knew its operating limits. He alone knew his limits – in terms of his capacity to control a large dozer, to look out and observe the batter and to find the edge. What is more Mr McKenzie was better situated to find the edge – his position in the seat of the dozer put him above the height of a man and higher than the long grass impeding the view of anyone on the ground. Mr McKenzie was well aware too of the difficulties that Mr Klenowski laboured under in terms of locating the edge – he, Mr McKenzie, had no wish to get down and enter the long grass to locate the edge because of the prospect of confronting snakes in the long grass. He had no reason to think that Mr Klenowski was any keener or had performed the exercise.
  1. When one turns to issues such as control and power it is clear that Mr Klenowski had no control and no power in the sense of directing how the work was to be performed and even whether it was to be performed. As Mr Crow SC, who appeared for the defendants, stressed, Mr Klenowski’s request to Mr McKenzie was precisely that – a request to go to an area. It is quite evident that Mr McKenzie was well aware that the decision was his as to whether he went there. That each man assumed that the dozer could clear the area in question safely is likely. The request would not have been made, or accepted, if that were not so.
  1. Further there was no assumption by Mr McKenzie that Mr Klenowski was taking on the responsibility of accurately identifying the edge of the batter for him. There is no suggestion in the evidence that Mr Klenowski had said anything to indicate that he had accurately identified the edge, as opposed to identifying that the batter was nearby, or that Mr McKenzie thought that he had done so. There are no particular circumstances that put Mr McKenzie in a position of vulnerability which Mr Klenowski ought to have appreciated.
  1. All parties knew that the edge of the embankment was an ever present hazard when working at the top of the block requiring vigilance from the operator. While it was argued that the land narrowed as one approached the location of the pink tape on the fence, there is no suggestion that Mr McKenzie did not know this. From Mr Klenowski’s viewpoint he was entitled to assume that Mr McKenzie was in fact competent to find the edge in the circumstances I have described, as Mr McKenzie and his employer each had assumed. They, after all, had much greater knowledge of Mr McKenzie’s abilities, the difficulties of operating the dozer and the safe capacities of the dozer than he did. What is more, Mr Klenowski could legitimately bring into account the fact that the same company had previously cleared the land and so its guiding minds would presumably have a good appreciation of the risks involved.
  1. And while it can be said that Mr Klenowski knew that the employer had taken no particular precautions to protect Mr McKenzie, that is not really the question. Rather the third and fourth questions posed by McHugh J in Crimmins that I have set out above[48] are relevant and I would answer each of them “No” here. What Vella’s approach puts at nought are the advantages that Vella’s had over Mr Klenowski in terms of assessing both the risk and the adequacy of their response to that risk.
  1. Further the precautions that Mr Morton urges ought to have been taken seem to me to be quite unreasonable. The submission was that Mr Klenowski ought to have appropriately placed star pickets with tape running between them to mark the edge of the batter. This would have required Mr Klenowski to leave the scene, locate a sufficient number of star pickets and then somehow hammer them into the ground in appropriate locations, all before Mr McKenzie could start any work that brought him anywhere near the batter – all to become his responsibility after he realised that the employer was not going to take such precautions, which could only occur after they had arrived at the scene and Mr Klenowski had determined their intentions.
  1. In my view none of the five matters mentioned by Basten JA in Abramovic as potentially giving rise to the existence of a duty are present here.[49] While Mr Klenowski did make a request for work to be done in a certain area he in no way sought to “direct the manner of performance of the work”There was no need to coordinate activities of different contractors. Mr Klenowski had no special knowledge of the risk that “the employer does not and cannot reasonably be expected to have”. In fact, to the contrary. Mr Klenowski did not have “the means to alleviate the risk [where] the employer cannot reasonably be expected to do so”.  And Mr Klenowski was not to appreciate that the employer had not taken adequate steps in the circumstances to alleviate the risk. He lacked the specialised knowledge that Mr Vella and Mr McKenzie possessed that put them in a much better position to determine the adequacy of the employer’s response. Assuming that there was such a failure it lacked the flagrancy that Callinan J spoke of in Crimmins as necessary for the imposition of a duty.
  1. Of the 17 “salient features” identified by Allsop P in Stavar Mr Morton urged the following as relevant here: (1) the foreseeability of harm; (2) the degree and nature of control able to be exercised by the defendant to avoid harm; (3) the degree of vulnerability of the plaintiff to harm from the defendant's conduct, including the capacity and reasonable expectation of a plaintiff to take steps to protect itself; (4) the degree of reliance by the plaintiff upon the defendant; (5) any assumption of responsibility by the defendant; (6) the proximity or nearness in a physical, temporal or relational sense of the plaintiff to the defendant; (7) the nature or the degree of the hazard or danger liable to be caused by the defendant's conduct or the activity or substance controlled by the defendant; (8) knowledge (either actual or constructive) by the defendant that the conduct will cause harm to the plaintiff. While I accept that those features are relevant the second, third, fourth, and fifth matters count against and not for the first defendant’s claim. And it is putting the case too high to assert that Mr Klenowski knew that his conduct in requesting that Mr McKenzie go to the area and in not putting up a barrier of some sort would cause him harm.
  1. Finally I would comment that here, to adapt the words of Brennan J in Stevens quoted above, there has been no failure to take reasonable care in the employment of independent contractors competent to control their own systems of work, nor any failure in not retaining a supervisory power, nor any scope to argue that the principal has left undefined the contractor’s areas of responsibility. That is so because, consistently with the reasoning in Leighton Contractors, the principal was not subject to an ongoing general law obligation with respect to the safety of the work methods employed by the contractor provided the principal engaged a competent contractor[50] and there is nothing unreasonable about contracting out the work of land clearing as “[i]t is an activity that requires specialised equipment and which lends itself to being carried out by independent contractors.”[51]

Conclusion

  1. To the extent that the decided cases provide any principled guidance it seems to me that they are against the imposition of the duty. I can see nothing special in the circumstances that would justify the imposition of the duty contended for and many that go against it.
  1. In my opinion no duty of care of the kind suggested came on to the defendants and hence they are not liable to make any contribution to the damage suffered by Mr McKenzie.
  1. That makes it unnecessary to consider the arguments concerning the reasonableness of the settlement. Given that I will make only limited comment on the arguments presented:
  1. To argue that liability should not have been conceded was not only not squarely raised on the pleadings, but contrary to the implications of paragraph 1B(b) of the Amended Defence of the defendants and its reference to the need for a reduction for contributory negligence. In my view it was not open to the defendants to now raise the issue.
  1. I would have thought that a substantial apportionment was open.  The complaint regarding the failure to wear a seat belt seemed to me untenable for a number of reasons, not least because of the impossibility of showing that the plaintiff’s injuries were likely to have been less serious had it been worn.
  1. However Mr McKenzie, in my view, would have had difficulty avoiding a finding of failing to keep a proper look out or exercising sufficient care in identifying the edge of the batter. Obviously minds can differ but I would have thought that an apportionment between 20% and 30% was reasonably open.[52]
  1. No evidence was led concerning the quantum of damages. In the absence of such evidence, or at least evidence of the information that the first defendant acted on when determining the settlement sum, I have difficulty seeing how I could be satisfied that the settlement was a reasonable one. While I could estimate future economic loss on the evidence lead, I see no basis on which I could judge significant components such as past and future care or future expenditure – for which Mr Morton has allowed $400,000 in his schedule.

Orders

  1. There will be judgment for the second defendant and the first and second third parties against the first defendant.
  1. I order that the first defendant pay the costs of the second defendant and the first and second third parties.

Footnotes

[1] For a discussion of the relevant principles see Nominal Defendant v Buchan [2011] QSC 364; Nominal Defendant (Qld) v Langman [1988] 2 Qd R 569, 572; Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603, 653.

[2] T1-20/15; T1-41/12

[3] See para 30 of Vella’s submission Ex 23

[4] I understood the submission to mean that Mistranch Pty Ltd had been engaged by the land holders to organise the de-grassing by in turn engaging contractors

[5] Cf the reasoning in Pacific Steel Constructions Pty Ltd v Barahona [2009] NSWCA 406 at [115]-[116]

[6] T1-46/45 - 47/5

[7] Clearly seen on Ex 3

[8] T1-30/27

[9] T1-30/5-15

[10] T1-39/5

[11] T1-38/7; see also T1-46/55

[12] T1-39/7-17

[13] T1-30/20

[14] T1-38/40; 1-39/15; T1-49/38

[15] T1-46/30

[16] T1-31/25-40

[17] T1-41/40

[18] T1-49/20

[19] Ex 19

[20] See Ex 21

[21] T1-41/55; T1-45/20

[22] T1-42/5-20

[23] T1-37/49

[24] T1-43/15

[25] T1-50/1-5

[26] (2009) 240 CLR 1 at [48]; [2009] HCA 35

[27] (1986) 160 CLR 16 see particularly at p 31 per Mason J and pp 47–48 per Brennan J

[28] (2009) 240 CLR 1 at [46]

[29] (2009) 240 CLR 1 at [52]

[30] Ex 23 – First Defendant’s Outline of Argument

[31] Citing McLean v Tedman (1984) 155 CLR 306 at p. 312; Ferraloro v Preston Timber Pty Ltd (1982) 56 ALJR 872 at 873

[32] Citing McLean v Tedman at pp 311 – 312

[33] (1999) 200 CLR 1

[34] [2003] NSWCA 132

[35] (1999) 200 CLR 1 at [276]

[36] [2007] NSWCA 248

[37] [2007] NSWCA 248 at [98]

[38] [2009] NSWCA 258 at [102]

[39] Ibid at [108]

[40] (1986) 160 CLR 16 at 47-48. Emphasis added. Confirmed in Leighton at [20]

[41] Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1 at [93]

[42] Ibid and see at [36] and [42]-[45]. Citation of authorities omitted.

[43] Ibid at [360]. Emphasis added.

[44] Amaca Pty Limited v The State of New South Wales & Anor [2004] NSWCA 124 per Ipp JA at [19] and [65]

[45] Sydney Water Corporation v Abramovic [2007] NSWCA 248 at [87] per Basten JA

[46] Such as in Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1

[47] Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1 per McHugh J who identified the vulnerability of the employee arising from “the casual nature of his employment and his obligation to obey the authority’s directions as to where he worked”: see at [51]

[48] At [43]: 3. Was the plaintiff or were the plaintiff’s interests vulnerable in the sense that the plaintiff could not reasonably be expected to adequately safeguard himself or herself or those interests from harm? If no, then there is no duty. 4.  Did the defendant know, or ought the defendant to have known, of the risk of harm to the specific class including the plaintiff if it did not exercise its powers? If no, then there is no duty.

[49] See [38] above

[50] See Leighton Contractors v Fox (2009) 240 CLR 1 at [59]

[51] Ibid at [62]

[52] Cf Osborne v Downer EDI Mining Pty Ltd [2010] QSC 470

Close

Editorial Notes

  • Published Case Name:

    Vella's Plant Hire Pty Ltd v Mistranch Pty Ltd & Ors

  • Shortened Case Name:

    Vella's Plant Hire Pty Ltd v Mistranch Pty Ltd

  • Reported Citation:

    [2013] 1 Qd R 152

  • MNC:

    [2012] QSC 77

  • Court:

    QSC

  • Judge(s):

    McMeekin J

  • Date:

    29 Mar 2012

Litigation History

Event Citation or File Date Notes
Primary Judgment [2013] 1 Qd R 152 29 Mar 2012 -

Appeal Status

No Status