Casalino v Insurance Australia Ltd t/as NRMA Insurance [2007] ACTSC 25 (20 April 2007)

Last Updated: 7 May 2008

BRIDGETT CASALINO v INSURANCE AUSTRALIA LIMITED

t/as NRMA INSURANCE [2007] ACTSC 25 (20 April 2007)

INSURANCE - motor vehicle - compulsory third party insurance - motorist held at gunpoint and forced to drive offender - whether injury caused by or arising out of use of motor vehicle - whether person directing the driving of a motor vehicle is a driver.

Road Transport (General) Act 1999, s 163, s 196

Victims of Crime (Financial Assistance) Act 1983

Riley v Insurance Commissioner of the State of Victoria [1972] VR 265

Mason v Dickason and Insurance Australia [2006] ACTSC 102

Hampson v Martin (1981) 2 NSWLR 782

McGrath v Cooper (1976) VR 535

R v MacDonagh (1974) 1 QB 448

Wallace v Major (1946) 1 KB 473

Ricketts v Laws (1988) 14 NSWLR 311

Commercial Building Centre Pty Ltd v NRMA Insurance [2003] ACTCA 3

New South Wales v RJ Green & Lloyd Pty Ltd [1966] HCA 6; (1966) 114 CLR 437

No. SC 816 of 2006

Judge: Connolly J

Supreme Court of the ACT

Date: 20 April 2007

IN THE SUPREME COURT OF THE )

) No. SC 816 of 2006

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: BRIDGETT CASALINO

Plaintiff

AND: INSURANCE AUSTRALIA LIMITED t/as NRMA INSURANCE

Defendant

ORDER

Judge: Connolly J

Date: 20 April 2007

Place: Canberra

THE COURT ORDERS THAT:

1. There be judgment for the defendant.

1. This is a claim for damages for personal injuries arising from an incident involving the use of a motor vehicle, which raises a novel question concerning the reach of compulsory third party motor vehicle insurance. The plaintiff is a young woman who, on the uncontested facts, was sitting in the driver's seat of her own motor vehicle near her workplace on the morning of 23 September 2004. She had parked her car and was intending to go to her workplace in Dickson in the Australian Capital Territory. It is common ground that an unknown male person entered her car through the rear door and, on the plaintiff's evidence which is uncontradicted and unchallenged, claimed to have a gun, and directed the plaintiff to drive him.

2. The plaintiff's case, which is not factually contested by the defendant, is that, in the belief that he did have a gun, she complied with his instructions. She says that she never got a clear view of him, because he told her not to look at him, and he said that he needed to get out of town because of trouble with the law. She says that he gave her instructions to proceed along Antill Street towards the Federal Highway, but because of road works near the Australian Heritage Village they were unable to access the highway. He directed her through an alternative route through suburban Watson, eventually reaching traffic lights at the corner of the Federal Highway and Stirling Avenue. He then directed her to proceed along the Federal Highway and she drove the vehicle in this direction, eventually leaving the Australian Capital Territory.

3. It is common ground that shortly after leaving the Territory she was directed to proceed up a side road off the highway and to stop the car. They left the car, and he assaulted her, before eventually leaving with the car. She flagged down a passing motorist who summonsed police assistance. Neither the assailant nor the car has ever been found. This action is limited to a claim in respect of the events within the Australian Capital Territory.

4. A consultant psychiatrist, Dr Knox, has provided a report stating that, as a consequence of these incidents, she has suffered from Acute Stress Disorder and Post Traumatic Stress Disorder. While this report does not break down the extent to which these conditions were caused by the initial incident where the plaintiff was forced to operate the motor vehicle to transport the offender within the Australian Capital Territory and the subsequent incident in New South Wales where the offender actually assaulted the plaintiff, it was common ground at the hearing before me that the initial incident was such as would be likely to give rise to a psychiatric injury.

5. The question before me at the hearing was whether in these circumstances the plaintiff could bring an action against her compulsory third party motor vehicle insurer.

Compulsory Third Party Insurance

6. In the Australian Capital Territory, as in other parts of Australia, the legislature has provided that every motor vehicle must, as part of the annual registration process, be covered by a form of insurance against personal injury. The Road Transport (General) Act 1999 (the Road Transport (General) Act) provides by s 163 that this form of insurance is one that:

(a) insures the owner of the motor vehicle to which the policy relates and anyone else who drives the vehicle (whether or not with the owner's authority) against liability in relation to the death of, or bodily injury to, a person caused by, or arising out of the use of, the vehicle anywhere in Australia (whether or not on a road or road related area); and

(b) is in the terms prescribed by the Regulations.

7. This claim is brought pursuant to s 196 of the Road Transport (General) Act, which permits a claim to be brought directly against the insurer if:

(1) at the time of a motor accident, someone other than the owner is driving the motor vehicle involved in the accident, whether or not the person is driving with the owner's authority.

8. It is common ground that the plaintiff was at all material times the person sitting behind the steering-wheel and operating the controls of the vehicle, albeit at all times under the direction of the unknown offender. The question thus arises as to whether she is able to bring such a claim.

Was the plaintiff the driver of the motor vehicle?

9. The plaintiff claims in par 7 of the amended statement of claim that, from the point at which the unknown assailant entered the vehicle claiming to have a firearm and, by threats, directed the plaintiff to drive the motor vehicle, the assailant was the driver of the motor vehicle pursuant to the Road Transport (General) Act.

10. The defendant insurer claims that, notwithstanding the traumatic and criminal nature of the unknown assailant's actions, the plaintiff remained at all times the driver of the motor vehicle, albeit acting under threat and compulsion in respect of the manner of the driving.

11. The dictionary in the Road Transport (General) Act states that to drive a vehicle includes:

(a) Being in control of the steering, movement or propulsion of the vehicle.

12. The plaintiff says that, on the facts, the assailant was in effect in control, and that she was only acting under his direction. The defendant says that, on the plain language of the definition, the plaintiff was in control of the steering, movement and propulsion of the vehicle as the person with her hands on the wheel and her feet on the pedals.

13. The question as to whether a passenger can be said to be a driver, due to the extent of their control over the operation of a motor vehicle, has been considered by Australian courts, although not in so stark a form as the present. In Riley v Insurance Commissioner of the State of Victoria [1972] VR 265 the Victorian Supreme Court had to consider a claim by an insurer that a passenger was not entitled to recover as a consequence of an accident because the passenger had such a degree of control over the person actually operating the controls as to be, in effect, the "driver" for the purpose of the equivalent section of the Victorian legislation.

14. The facts giving rise to this argument was evidence that the passenger had been permitted by his father to take a motor vehicle owned by his father, and that he had in turn allowed a friend to take the wheel and operate the vehicle, in circumstances where both the person behind the wheel and the plaintiff passenger considered that the passenger was entitled to give directions as to the manner of the operation of the vehicle, and that the person driving the vehicle was bound to comply with any such directions.

15. Gowans J there held that the term driver in the Victorian legislation was "intended to refer to the physical act of driving". He noted (at 268) that:

The dicta in Wheatley v Patrick (1837) 2 M&W 650 that as a matter of pleading an allegation that a person is the driver may be satisfied by evidence that that person is in such possession of the vehicle and such control of the acts of the driver that he can direct the driving is not, in my opinion, a safe guide to the construction of a statutory provision of the kind under consideration.

16. It would seem that this result must be correct, because otherwise any passenger in a taxi, who is entitled to give directions to the driver as to destination and route which the driver is obliged to comply with, would be deemed to be a "driver" and so be unable to bring a claim for personal injuries if the taxi was so negligently driven that the passenger sustained personal injuries.

17. The question recently arose in this Court in Mason v Dickason and Insurance Australia [2006] ACTSC 102. In that case the Master had before him a claim by a person who was injured when the passenger of the car she was driving suddenly pulled on the handbrake, causing the car to veer off the road. She brought an action against the person who had so applied the brake, and the question before the Master was whether that person could be said to be a "driver" within the terms of the relevant third party insurance, which, for present purposes, is identical to the policy in this case.

18. After an extensive review of the authorities, the Master concluded at [92]-[93] that:

I find that the defendant in pulling on the handbrake assumed control of the vehicle .... In those circumstances, it seems to me that the defendant should be found to have been a person who drove the motor vehicle for that brief period prior to its leaving the road and striking the wall. The defendant is therefore entitled to be indemnified under the third party policy.

19. While this decision is presently before the Court of Appeal, it can be said that it would on its facts be distinguishable from the present case because it is based on a finding that the passenger was physically in control of the vehicle, or at least aspects of the vehicle, by the physical act of grabbing the handbrake and applying it to stop or slow the vehicle.

20. There are a number of cases arising in circumstances where a person is steering a vehicle under tow. In Hampson v Martin (1981) 2 NSWLR 782, Foster J held that a person cannot be said to be driving a motor vehicle:

unless in addition to having control over the steering and braking systems of the vehicle he also has control over its means of propulsion. Accordingly, a person who is steering or guiding a motor vehicle under tow does not drive that motor vehicle within the meaning of s 4E(1)(a).

21. This case was, however, concerned with a prosecution for driving under the influence. Similar conclusions have been reached as to criminal responsibility for "driving" a vehicle under tow in Victoria in McGrath v Cooper (1976) VR 535, and in the United Kingdom in R v MacDonagh (1974) 1 QB 448 and Wallace v Major (1946) 1 KB 473.

22. In the insurance context, there are authorities for the proposition that more than one person may be the driver. In Ricketts v Laws (1988) 14 NSWLR 311 a driving instructor who was in the passenger seat was held, for the purposes of third party insurance, to be a driver in addition to the person actually behind the wheel.

23. In that case a young learner driver was driving in her mother's vehicle in the company of her driving instructor, who was seated in the passenger seat. I assume from these facts as stated in the case that the vehicle was not a specialised dual control vehicle as may be found in the possession of some driving schools. An accident occurred as the vehicle was taking a corner, when the instructor flicked a cigarette butt out of the window, and embers re-entered the vehicle. The injured driving student brought action against the instructor, and the question arose as to whether the instructor could be said to be the driver for the purposes of the accident.

24. Kirby P said at 314:

If the question were who was the driver of the motor vehicle for the ordinary purposes of that word in the English language, one would quite possibly conclude that it was, and only was, the person behind the wheel. I say this although the matter is not beyond argument as the old case of Wheatley v Patrick [1837] EngR 338; (1837) 150 ER 917 will demonstrate. Nevertheless it is true that the word `driver' would normally be used, in terms of every day speech, to refer to the person who is behind the wheel.

On the other hand, a vehicle may have two drivers - as for example, where an instructor actually had his or her hand on the wheel or was controlling the direction of the car from a dual mechanism.

25. His Honour went on to conclude at 319 that:

In respect of the position of the instructor driver, commonsense would suggest an instructor is really in control. It has long been established at common law that, although not actually driving, a person is liable for the negligence of a driver of a motor vehicle over which that person had a right to exercise control: see Trust Co Ltd v De Silva [1956] 1 WLR 376.

Putting it another way, an instructor is in charge. But if the instructor is in charge he or she is, for the purposes of the Act, the driver. In that way he or she is entitled to the protection which the Act gives to drivers. If negligence can be proved against that driver, the statutory policy is attracted. This will be so, even though for other purposes as in Riley, that driver is also a passenger and is in that capacity suing another driver for negligence. If there is negligence in both, both may recover.

The result should not cause surprise. The apportionment for contributory negligence allows a court to determine the respective contributory negligence of each and the indemnity provided to the driver by the owner's insurance in respect of the motor vehicle provides the fund from which each will recover and not be dependent on the assets of the tortfeasor for that purpose. Far from being unexpected, this result secures the legislative purpose. After all, each set of injuries arose out of the negligent control of the insured motor vehicle on a public street. That is the fundamental purpose of providing compulsory insurance.

26. Hope and Clarke JJA both agreed with this reasoning, which seems to me to be compelling. If, for the reasons given by Kirby P, a driving instructor who is "in charge" may be said to be the driver because they are "in charge " by reason of giving instructions, surely a person who has commandeered a vehicle by holding a gun to the head of the driver and giving instructions or commands as to the manner of driving and the route to be followed is also "in charge". If the injury here complained of had occurred because the unknown assailant had demanded that the plaintiff drive up a one-way street or travel at an unsafe speed, and an accident had occurred as a result of this negligence, then surely the injured plaintiff would have an action.

27. It seems to me that for the purposes of this claim, the unknown assailant can also be said to have been the driver of the motor vehicle.

Were the injuries "caused by, or arising out of the use of, the vehicle"?

28. On the facts in Ricketts and in Mason v Dickason, there was no argument that the action was brought in respect of an injury caused by or arising out of the use of the vehicle. This is the statutory formulation used in the Road Transport (General) Act which defines a motor accident as "an accident or other incident in which the death of, or bodily injury to, a person is caused by or arises out of the use of a motor vehicle" (s 158).

29. The plaintiff here does not complain of physical or psychiatric injury caused by a collision between the motor vehicle and another vehicle or an object. Rather, the claim is based on the psychological trauma that she undoubtedly would have suffered as a consequence of being confronted by an armed man who demanded that she drive him in her car.

30. The question of whether injuries can be said to arise out of the use of a motor vehicle has frequently come before Australian courts, usually in the context of dual insurance in cases where a worker sustains an injury, and the worker's compensation insurer seeks under subrogation to bring a claim against the motor vehicle insurer. A recent example in this jurisdiction was Commercial Building Centre Pty Ltd v NRMA Insurance [2004] ACTCA 3. This case proceeded on the basis of agreed facts which stated that a worker, Mr Delaney, had been injured in the course of loading bags of plaster onto a truck. The operation was that one man would take a bag from a pallet, and hand it to Mr Delaney, who would take the bag and in turn pass it to a third man who would place the bag on the truck. Mr Delaney wrenched his back in the course of this operation, and was paid worker's compensation. The worker's compensation insurer sought to bring a claim against the motor vehicle third party insurer of the truck.

31. The Court of Appeal, Crispin P, Cooper and Weinberg JJ held that this injury did not arise out of the use of an insured motor vehicle. They said (at [10]-[12]):

Whether the bodily injury was caused by or arose out of the use of an insured motor vehicle is simply a question of fact, to be proved by evidence adduced by the party seeking the benefit of the compulsory third party insurance: Government Insurance Office of New South Wales v King at 95,104,105. Each case must be determined on its own facts. Nothing can be gained by assuming different facts and seeking to arrive at a conclusion from them: Harvey Trinder (NSW) Pty Ltd v Government Insurance Office of New South Wales [1966] HCA 25; (1966) 114 CLR 449 per Windeyer J at 452-3.

The authorities establish that the use of an insured motor vehicle includes the doing of all things reasonably incidental to its normal use as a motor vehicle: Fawcett at 92, King at 96, State Government Insurance Commission (SA) v Stevens Bros Pty Ltd [1984] HCA 32; (1984) 154 CLR 552 at 556. Where the motor vehicle is a truck designed to carry cargo or goods, the loading of the vehicle is a necessary element of its normal use. However, not all things done which are incidental or ancillary to such a loading necessarily in themselves amount to a use of the motor vehicle. Thus in Government Insurance Office of New South Wales v RJ Green & Lloyd Pty Ltd [1966] HCA 6; (1966) 114 CLR 437 Barwick CJ, with whom McTierrnan and Taylor JJ agreed, said (at 442-3):

... The words "arising out of" in s 10 of the Act and in the indemnity clause of the policy are not merely, if at all, explicative of the words "caused by", they are really used in contrast to them; and in the total expression are extensive in their import. Bearing in mind the general purpose of the Act I think the expression "arising out of" must be taken to require a less proximate relationship of the injury to the relevant use of the vehicle than is required to satisfy the words "caused by". It may be that an association of the injury with the use of the vehicle while it cannot be said that that use was causally related to the injury may yet be enough to satisfy the expression "arise out of" as used in the Act and in the policy.

On the other hand, injuries received away from the vehicle but in the course of bringing goods or things to it to be loaded upon it ought not, if no more appears, to be regarded as having arisen out of the use of the motor vehicle. To say that the operation of loading and unloading a transport vehicle is part of its use is to state the matter too widely ...

Windeyer J in Green & Lloyd, stated the statutory requirements of "bodily injury caused by or arising out of the use of a motor vehicle" in the following terms (at 447):

... The policy covers a vehicle of a kind described when used for its ordinary purposes. In the present case the vehicle, a motor truck, was classified as a `goods vehicle'. The loading of a vehicle designed to be used, and ordinarily used, for the carriage of goods is a necessary element in its ordinary use. Loading it is incidental to the use of it in the normal way. But that does not mean that whatever is done that is incidental or ancillary to such loading is itself a use of the vehicle in the relevant sense. Therefore, if a person suffers bodily injury when engaged upon some task connected with loading, the question whether his injury was caused by or arose out of the use of the vehicle depends upon whether it was a consequence, direct and not remote, of the operation of loading.

But the question that arises in cases such as this is not answered simply by asking was the vehicle being used.

32. In the present case I have no doubt that the plaintiff has been genuinely traumatised by the violent crime that she was subjected to. While the assault in New South Wales is beyond the scope of this claim, she does claim that the trauma that she sustained as a consequence of being forced to drive the unknown assailant within the Australian Capital Territory at what she took to be the point of a gun was an injury arising out of the use of a motor vehicle.

33. Her evidence was that she was in terror from the moment the man entered the vehicle. Dr Knox has said that her condition of post-traumatic stress disorder arises from her abduction. Her injuries are very much what one would expect from a person who is the victim of a violent crime, and it seems to me that that is precisely what has happened here - the plaintiff has been the victim of a crime, being an abduction and forcible confinement, during which she was forced to use her motor vehicle to transport an armed assailant. Her injuries, by way of psychological trauma arise, it seems to me, from the violent nature of the crime, and the natural fear of having a weapon aimed at her, rather than from the "use of a motor vehicle". She was not injured as a consequence of any collision between the vehicle and any other vehicle or object, but rather sustained a psychological injury commencing from the moment the assailant entered the vehicle and made his unlawful demands. She has, in effect, been the victim of a violent carjacking. While this is unfortunate and deserving of sympathy, it is not, it seems to me, a circumstance falling within the compulsory third party motor vehicle insurance, and her injury cannot be said, in my view, to arise out of the use of a motor vehicle.

34. That an offender claiming to be armed has entered the vehicle and by threats forced the plaintiff to drive him, does obviously involve a use of the vehicle, but it seems to me that the cause of the injury was the threat of violence, which, applying the analysis of Windeyer J in Green & Lloyd recently restated by the Court of Appeal in Commercial Building Centre v NRMA Insurance, was incidental or ancillary to the normal and legitimate use of the motor vehicle so that it cannot be said to arise out of the use of the motor vehicle.

35. It seems to me that the unfortunate circumstances the plaintiff found herself in were similar to other victims of crime committed involving a motor vehicle, but such victims do not have recourse to the compulsory third party motor vehicle personal injury insurance regime. It is unfortunately the case that this Court, in the exercise of its criminal jurisdiction, is frequently confronted with sexual assaults or domestic violence that occur inside a motor vehicle, but such crimes, leading as they often do to personal injury, do not, it seems to me, "arise out of the use of a motor vehicle". Would a drive by shooting be covered? This question was perhaps foreshadowed by Menzies J in Fawcett v BHP By-Products Pty Ltd at 87, where his Honour gave an example of a person who steals a car, drives it to his enemy and uses it as a fort from which to shoot at that enemy, saying:

... the injury so suffered would not give rise to a liability that has to be covered by a third party policy, and this is so simply because the Act is not concerned with such a liability and the bodily injury so occasioned cannot fairly be described as arising out of the use of the motor vehicle.

It seems to me that the same analysis should be applied in the present case.

36. To the extent that an examination of the parliamentary intention of the scheme sheds any light on this question, it seems to me that all records of debates focus on the need to cast a broad scheme to protect victims of motor vehicle accidents, but I see no indication that this was intended to include victims of crimes that may be committed in a motor vehicle, or from a motor vehicle. There is in place a statutory scheme to provide assistance to victims of crime by way of the Victims of Crime (Financial Assistance) Act 1983.

37. I am not satisfied that this incident occurred in circumstances giving rise to an insurance liability under the ACT compulsory third party insurance scheme established pursuant to the Road Transport (General) Act and, accordingly, there will be judgment for the defendant.

I certify that the preceding thirty-seven (37) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Justice Connolly.

Associate:

Date: 20 April 2007

Counsel for the plaintiff: Mr D Richards

Solicitor for the plaintiff: Slater & Gordon Lawyers

Counsel for the defendant: Mr W Fitzsimmons

Solicitor for the defendant: Moray & Agnew

Date of hearing: 16 February 2007

Date of judgment: 20 April 2007