Mine operator successfully relies on contractual indemnity
Whether the contractual arrangements between the defendants resulted in a transfer of liability from one defendant to another.
- Whether plaintiff caused or contributed to his own injuries
- Whether the excavator operator was employed by the mine operator pro hac vice
- Whether the employer of the excavator operator was obliged to indemnify the mine operator
Clint Paskins (the plaintiff) sought damages for injuries sustained on 16 August 2013 at a mine operated by the first defendant, Hail Creek Coal Pty Ltd (Hail Creek). The plaintiff alleged that he sustained personal injuries when the tray of the haul truck he was operating collided with the bucket of an excavator. The excavator operator, Anthony Phillips, was employed by the second defendant, Workpac Pty Ltd (Workpac) and placed at the mine pursuant to an agreement between Workpac and Rio Tinto Services Ltd (Rio Tinto). The plaintiff alleged that the incident was caused by Mr Phillip’s negligence, for which Workpac was vicariously liable, or by an unsafe system of work, for which Hail Creek was liable. The defendants denied liability on the basis that the incident was caused by the plaintiff’s negligence. Workpac sought to avoid liability on the basis that Hail Creek was Mr Phillips’ employer pro hac vice. Hail Creek issued third party proceedings claiming that Workpac was obliged under its contract with Rio Tinto to indemnify Hail Creek (a Rio Tinto subsidiary) in respect of the plaintiff’s claim.
The court found that Mr Phillips ought to have kept the bucket of the excavator clear of the reversing truck. It was accepted that there was a mound of spoil present on the ground from a previous loading operation which caused the reversing vehicle to rise up higher than it normally would. The court held that the incident occurred as a result of an error of judgment by Mr Phillips in assessing the height of the bucket, the likely effect of the mound of spoil on the height of the tray, and in failing to sound a timely signal to the plaintiff to stop. Mr Phillips’ errors, particularly the first and third, fell below the standard of reasonable care that should be expected of an excavator operator and amounted to negligence.
Workpac sought to avoid liability on the basis that Mr Phillips was employed by Hail Creek pro hac vice. The court rejected that argument, finding that Mr Phillips subjected himself to the control of Hail Creek to the extent that he did because that was what his employment with Workpac obliged him to do.
The court could not criticise Hail Creek’s system of work. However, noting the non-delegable nature of the employer’s duty, it was found that Hail Creek had also breached its duty of care to the plaintiff.
The court found that the plaintiff was not wearing his seatbelt appropriately, but held that contributory negligence was not made out as there was no evidence that the back injury would have been lessened had the plaintiff worn the seatbelt.
Workpac’s arguments that the contractual indemnity did not apply were predicated on a finding that Mr Phillips did not commit a negligent act or omission. Having found to the contrary, the court held that Workpac was required to indemnify Hail Creek for the liability incurred by it in respect of the plaintiff’s claim.
Implications for you
This case is the latest in a string of recent personal injury decisions where the contractual arrangements between the parties have ultimately served to transfer liability from one defendant to another. The terms of each contract must always be carefully considered in the context of each factual scenario.