Defect in the motor vehicle – CTP Insurer found liable for injury caused in the use and operation of forklift

Judgment date: 22 May 2012

TVH Australasia Pty Ltd v Chaseling

(2012) NSWCA 149 NSW Court of Appeal¹

In Brief

• An injury sustained as a result of the negligent use and operation of a forklift, even when an employer is aware of associated risks, will be characterised as "injury" under the Motor Accidents Compensation Act 1999 (the 'Act') and not the result of an unsafe system of work.
• A distinction should be drawn between a case involving negligence in the loading or unloading of a motor vehicle, and the driving of a motor vehicle with an unsafe load. Only the latter will fall under the Act.

Background

On 29 June 2006, the plaintiff, in the course of his employment with the defendant, was injured when a box fell from a forklift on to his leg whilst he was assisting in the unloading of a shipping container. The plaintiff generally worked in the office and had not been asked previously to assist with unloading.

At trial the evidence disclosed that the boxes, which were placed on plastic pallets, often moved and become unstable when the containers were in transit. There was also evidence that the tines of the forklift, which were used to move the pallets, needed to be spread apart in order to counter the flexibility of the pallets. The driver of the forklift on the day of the accident did not spread the tines. This was despite the fact the defendant was aware of the risks associated with unloading containers and particularly the transporting of material on forklifts on plastic pallets which were susceptible to breaking and flexing.

The case at first instance was heard in the District Court of NSW before Judge Levy ² . His Honour held that the plaintiff sustained an `injury', within the definition in s 3, as it then was, of the Act and awarded damages in the sum of $712,275. The defendant appealed to the Court of Appeal.

The Grounds for Appeal

The defendant appealed on the following grounds:

1. The defendant was not liable in negligence for the plaintiff's injury.
2. The injury did not fall within the terms of the Act.

The Judgment

The Court of Appeal unanimously dismissed the Appeal and the lead judgment was handed down by Basten JA.

With respect to the first ground of appeal, Justice Basten found that:

1. There was sufficient evidence at trial that the defendant was aware of the risks associated with the unloading of containers,
2. The driver of the forklift was inexperienced, and
3. The plaintiff was not given instruction in relation to the risks of an activity which he had not participated in previously.

In relation to the second ground of appeal, as at the date of the accident, the Act contained the following definition of "injury" in section 3:

In contrast, the word "injury" as defined in the Workers Compensation Act 1987 (NSW) means "personal injury arising out of or in the course of employment": section 4(a).

His Honour at 24 held that:

His Honour was referring to the leading case of Allianz Australia Insurance Ltd v GSF Australia Pty Ltd ³ . In that case the High Court held that in respect of defect cases, to fall within the definition of "injury", the injury must be sustained during the use or operation of the motor vehicle and as a consequence of a defect in the motor vehicle.

The Defendant argued that even if there was fault on its part as owner of the vehicle, the fault was not in the use or operation of the vehicle. Specifically, it was the failure to provide a safe system of work for that use operation.

His Honour considered that this case involved the driving of a forklift with an unsafe load, not the negligent loading or unloading in the use of the forklift. As such, there was fault in the use or operation of the forklift.

His Honour at 30 explained that:

Implications

This accident occurred prior to the 1 October 2006 amendments to section 3 of the Act. Restrictions were put in place with respect to the definition of 'motor accident' in the new Section 3A as follows:

Therefore, an injury in the use or operation of a motor vehicle, caused by an unsafe system of work (as it was in this case), may fall under the Act, if the negligence relates directly to the manner in which the vehicle was being operated.

Foortnotes

¹ Per Basten JA, Bathurst CJ and Whealy JA agreeing
² Chaseling v TVH Australasia Pty Ltd (2011) NSWDC 24
³ [2005] HCA 26; 221 CLR 568

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