GIO GENERAL LIMITED (ACN 002 861 583) v INSURANCE AUSTRALIA LIMITED trading as NRMA INSURANCE (ACN 000 016 722)
[2011] ACTSC 91 (2 June 2011)

No. SC 106 of 2008

Judge:	RYAN J
Supreme Court of the ACT
Date:	2 June 2011 

IN THE SUPREME COURT OF THE	)
	)	No. SC 106 of 2008
AUSTRALIAN CAPITAL TERRITORY	)	

BETWEEN:	GIO GENERAL LIMITED
	(ACN 002 861 583)

	Plaintiff

AND:	INSURANCE AUSTRALIA LIMITED trading as NRMA INSURANCE (ACN 000 016 722)

		Defendant

ORDER

Judge:	RYAN J
Date:	2 June 2011
Place:	Canberra

THE COURT ORDERS THAT:

1.	The plaintiff’s claim be dismissed.
2.	The plaintiff pay the respondent’s costs, including any reserved costs, such costs to be taxed in default of agreement. 

IN THE SUPREME COURT OF THE	)
	)	No. SC 106 of 2008
AUSTRALIAN CAPITAL TERRITORY	)	

BETWEEN:	GIO GENERAL LIMITED
	(ACN 002 861 583)

	Plaintiff

AND:	INSURANCE AUSTRALIA LIMITED trading as NRMA INSURANCE (ACN 000 016 722)

		Defendant

REASONS FOR JUDGMENT
1.	On or about 30 August 2005, Mrs Nocevska (“the worker”) an employee of Compass Group (Australia) Pty Ltd (“the employer”) was injured in the course of her employment when she was unloading a bag of freshly laundered linen from a light truck (“the truck”) at the Australian Defence Force Academy.  The worker is entitled to workers compensation under the Workers Compensation Act 1951 (ACT) (“the Workers Compensation Act”).  The employer held an insurance policy issued by the plaintiff, GIO General Limited (“GIO”) under which GIO was obliged to indemnify the employer against liability to its employees under the Workers Compensation Act and at common law.
2.	In accordance with that policy, GIO made weekly payments of compensation to the worker and reimbursed her in respect of medical expenses incurred as a result of the injury.  Those payments, in all, amounted to $42,032.88.  On 5 May 2006, GIO gave notice to the worker rejecting her workers compensation claim and advising her that weekly compensation payments and payment of treatment expenses would cease on 7 July 2006.
3.	The defendant, Insurance Australia Limited (“NRMA Insurance”) was the insurer of the employer against its liability as the owner of the truck to claims for common law damages to which the Road Transport (General) Act 1999 (ACT) (“the Road Transport Act”) applied.
4.	After the worker received the notice from GIO described at [2] above, her solicitors wrote to GIO a letter dated 23 May 2006 in these terms;
We advise that we have received instructions from the abovenamed [the worker] in respect of a work place injury.
We are in possession of a letter from you dated 5 May 2006 indicating that all weekly compensation benefits will cease on 7 July 2006.
We advise that we shall in due course be making an application for the continuation of those payments.  We shall file an Application for Arbitration pursuant to the Worker’s Compensation Regulations 2002.
In addition to this, in order to preserve our client’s position in respect of any negligence claim, we also enclose a Personal Injury Claim Notification Form.  If you are not the correct person to serve this Form upon, could you please contact the writer advising of this as a matter of urgency.

5.	On 13 July 2006, the worker made application under the Workers Compensation Act against the employer in the Magistrates Court of the Australian Capital Territory.  The Form MC1 application requested an arbitration and, in the body of the application, described the “Nature of application” as being:
application for arbitration by injured worker with respect to the respondent’s liability for and amount of weekly compensation payable to the applicant
(Act, pt 4.2 (Compensation for personal injury and pt 4.3 (Weekly compensation))
application for arbitration by injured worker with respect to the respondent’s liability for and amount of medical treatment, damage and other costs
(Act, pt 4.5 (Compensation for medical treatment, damage and other costs))

6.	Particulars annexed to the worker’s application identified the date of the injury as 30 August 2005 and recited that it had happened “When putting clean linen on a trolley pain developed in the Applicant’s right shoulder and went from her head down to her lower back into her buttocks.”  The nature of the injury was described as “Right and middle back muscle tear.”  
7.	On 16 October 2006 the solicitors for GIO wrote to NRMA Insurance a letter which, omitting formal parts, recited;
We act for GIO General Limited, the workers compensation insurer of Compass Group (Australia) Pty Limited.
We enclose a copy of correspondence from the solicitor for Roza Nocevska dated 23 May 2006, together with a Personal Injury Claim Notification dated 30 August 2005.
The claimant alleges that she sustained injuries to her back on 30 August 2005 whilst unloading clean linen onto a trolley from a 1999 Toyota light truck bearing registration YAU-15Z.
We also enclose the following further material for your assistance:
1	Certificate of Registration – YAU-15Z
2	An updated schedule of payments from GIO General Limited.
We confirm that, should the claimant commence common law proceedings in relation to the alleged incident, we put NRMA Insurance on notice that dual insurance issues will be pursued.
We will keep you informed of developments.

8.	The letter enclosed with that notification was that from the worker’s solicitors which is set out at [4] above.
9.	NRMA Insurance responded by letter dated 18 October 2006 which recited;
As discussed I note you have put NRMA Insurance on notice that dual insurance issues will be pursued if the claimant commences common law proceedings in relation to the alleged incident.

10.	By its amended answer to the worker’s application dated 14 May 2007, GIO, on behalf of the employer, denied liability in very general terms and alleged in paragraph 14;
In the alternative, any injury sustained by the applicant was the result of the applicant’s serious and wilful misconduct in disobeying an instruction given by Mr Christopher Brennan to all staff, including the applicant, approximately 1 week before the alleged incident that Linen bags were only to be half filled.

11.	Subsequently, the parties entered into settlement negotiations culminating in a settlement sum of $75,000 being paid to the worker.  The terms of the settlement agreement are contained in a number of documents, the relevant terms of which are recited at [15]-[20] below.

LEGISLATIVE PROVISIONS
12.	At the time of the injury to the worker the relevant legislative provisions of the Workers Compensation Act were as follows;
Settlement of claims
136	Contracting out
(1)	A provision of an agreement or other document is void if it purports to exclude, or limit in any way—
(a)	a right given to a worker under this Act; or
(b)	a liability imposed on an employer under this Act.
(2)	However, this section does not apply to an agreement by a worker to commute an existing right to compensation for a compensable injury under this part.
137	How worker may commute rights
(1)	A worker may commute, in writing, an existing right to compensation for a compensable injury on payment of an amount by the insurer (the settlement). 
(2)	The settlement may include a payout of 1 or more of the following:
(a)	the worker’s entitlement to weekly compensation under part 4.3;
(b)	the worker’s entitlement to compensation for permanent injuries under part 4.4;
(c)	the worker’s entitlement to compensation for medical treatment, damage and other costs under part 4.5;
(d)	an entitlement of the worker to compensation apart from this Act;
(e)	any other amount.

13.	Sections 163 and 171 of the Road Transport Act were in the following terms;
163	Third-party policies
A third-party policy is a policy 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 regulation.
…
171	Risks not insured under third-party policies
(1)	 third-party policy does not insure the owner or driver of a motor vehicle against—
(a)	a liability to pay compensation under the Workers Compensation Act 1951 (or any corresponding law of another jurisdiction) to a worker employed by the owner or driver; or
(b)	a liability that may be incurred by the owner or driver under an agreement unless the liability is a liability that would have arisen without the agreement.

14.	I note by way of background that, as of 1 July 2002, the Workers Compensation Act was amended and, while the substance had not changed for the purposes of this proceeding, there were some relevant changes to the prescribed form in which Workers Compensation Act agreements comprising settlement terms were recorded and registered.  The prescribed form after the 1 July 2002 amendments was Form 3.66, whilst before those amendments Forms 27 and 28 were prescribed.

TERMS OF SETTLEMENT
15.	On 24 May 2007, a largely pro forma document headed “Worker’s Compensation proceedings – Terms of Settlement” was signed at the Magistrates Court by Counsel for the worker and Counsel for the employer.  Including handwritten interlineations (and excluding those boxes which were not selected and those parts which were deleted) and additions, apparently in the hand of Counsel for the employer, that document was in the following terms;
“By consent
Workers’ Compensation proceedings
•	The worker commutes and redeems her rights under the Workers’ Compensation Act 1951 in relation to the injuries listed below* for a payment of $75,000, clear of any compensation already paid.
•	Form(s) 3.66, 27 and 28 are to be signed and registered by the worker.
•	A common law release is to be executed by the worker in relation to the listed injuries.
•	The commutation, redemption and common law release are to relate to all injuries suffered by the worker during the course of her employment with the employer.
•	Orders be made that:
•	the employer pay the worker’s costs to be agreed or taxed on the basis of 2/3rds of Schedule 4 of the Supreme Court Rules, with all reasonable disbursements allowed in full.
*The injuries are neck and back injury and pain, right shoulder and right upper limb injury, chronic musculo-ligamentous and radicular pain, chronic pain syndrome involving psychological and psychiatric reactions
Interest
•	No interest is to be paid in relation to the total amount to be paid to the worker pursuant to the foregoing settlement provided 90% is paid to the worker within 28 days of:
•	The date of registration of Form (s) 3.66, 27 and 28
whichever is the later and 10% is paid to Medicare Australia within 28 days of today’s date, otherwise interest is to run on all amounts at the rate applicable from time to time to judgments entered in the Supreme Court.
•	No interest is to be paid in relation to costs provided the costs are paid within 28 days of any agreement or taxation, otherwise interest to run on all amounts at Magistrates Court interest rate.
Other Terms
•	The worker agrees to provide the employer with all necessary and proper assistance in relation to any claim for dual insurance  arising out of her injury.
[Emphasis added to handwritten additions]

16.	The Form 3.66 noted in those terms of settlement was duly executed by the worker and registered in the Magistrates Court on 13 June 2007.  That form stipulated, so far as is relevant;
The applicant, Roza Nocevska, after receiving independent legal advice about this agreement, AGREES to commute her rights to compensation under the Workers Compensation Act (Act) from the respondent, Compass Group (Australia) Pty Limited (ACN 000 683 125) on the following terms--
1	Payment to applicant
1.1	The Respondent agrees to pay the Applicant the sum of $49,500 (being 90% of the Settlement Sum of $55,000) [‘Settlement Sum’] and pay the balance of 10% to Medicare Australia under the Health and Services (Compensation) Act 1995 (Cth) within 28 days of this agreement being registered.
1.2	The Settlement Sum is in addition to payments made to or on behalf of the Applicant by the Respondent under the Act.
1.3	Interest shall not run on the Settlement Sum if paid within 28 days of this agreement being registered, or within 28 days of any notice of charge of any social security money owing to Centrelink, whichever is the later.
2	Costs
2.1	The Respondent agrees to pay the Applicant’s costs to be agreed or assessed in accordance with rule 3968(4).
2.2	Interest shall not run on the costs and disbursements if paid within 28 days of being agreed or assessed in accordance with rule 3968(4).
3	Rights commuted by applicant
3.1	The applicant agrees to commute rights to compensation under the Act for injuries suffered by the applicant arising out of or in the course of employment with the respondent as follows:
•	The applicant’s entitlement to weekly compensation under Part 4.3 of the Act for total or partial incapacity.
•	The applicant’s entitlement to compensation for medical treatment, damages and other costs under Part 4.5 of the Act.
•	The applicant’s entitlement to compensation for permanent injuries under Part 4.4 of the Act.
3.2	The commutation relates to neck and back injury and pain, right shoulder and right upper limb injury, chronic musculo-ligamentous and radicular pain, chronic pain syndrome involving psychological and psychiatric reactions, and anxiety, depression, headaches, sleeplessness and functional overlay.
3.3	The commutation relates to all physical and psychological injuries suffered by the Applicant arising out of or in the course of her employment with the Respondent on 30 August 2005 and during the entire period of her employment with the Respondent.
4	Other Terms
4.1	The Applicant acknowledges she is no longer employed by the Respondent.
4.2	Paragraph 2 of the Application for Arbitration is amended to include a reference to the applicant’s head, neck, back, shoulders, both arms, both legs, both hands, both feet and any emotional or psychological reaction arising out of her employment with the respondent.

17.	The Form 27 was in these terms;
Form 27
AUSTRALIAN CAPITAL TERRITORY
IN THE MAGISTRATES COURT
AT CANBERRA IN THE				WC No. 07/162
AUSTRALIAN CAPITAL TERRITORY

In the matter of the Workers Compensation Act 1951
And in the matter of an agreement
Between
Roza Nocevska							Applicant
and
Compas Group (Australia) Pty Limited (ACN 000 683 125)
Respondent
TO:	Registrar, Magistrates Court
BE IT REMEMBERED that between September 1999 and 30 June 2002 and during the entire period of her employment with the respondent, personal injury was allegedly sustained in the Australian Capital Territory by the applicant, a worker with no legal disability, being injury arising out of and in the course of her employment with the respondent.
AND that on 24 May 2007, the following agreement was come to by and between the Applicant and the Respondent, namely:
1	The respondent agrees to pay to the applicant the sum of $20,000 in full and final settlement and redemption of the applicant’s entitlements for all physical and psychological injuries sustained by the applicant during the entire period of her employment with the respondent pursuant to the provisions of the Workers Compensation Act 1951 (ACT) (the ‘Act’) including, but not limited to, all entitlements pursuant to s 7, s 10 and s 11 of the Act and the First and Second Schedules of the Act.
2	The applicant accepts the sum of $20,000 in full satisfaction of the claim inclusive of all expenses arising out of her work injuries.
3	The Respondent agrees to pay the Applicant’s costs to be agreed or taxed at two thirds Supreme Court rate together with disbursements in full.
4	The Applicant will execute a common law release.
5	The Applicant acknowledges her employment with the Respondent has ceased.
6	The sum of $20,000 will not be payable until this Agreement is registered under the provisions of the Act. Interest shall not run on the settlement sum if paid within 28 days of this Agreement being registered, or within 28 days of any notice of charge of any social security money owing to Centrelink, whichever is the later.
7	The Applicant acknowledges that she was informed by the Respondent before the making of the offer of settlement accepted by the Applicant that there may be a liability to pay an amount to the Commonwealth pursuant to the Health & Other Services (Compensation) Act 1995 (Cth) or the Health & Other Services (Compensation) Care Charges Act 1995 (Cth).
8	Pursuant to the Health & Other Services (Compensation) Act 1995 (Cth) and by consent between the Applicant and Respondent, it is agreed that within 28 days of this agreement being registered the Respondent will pay to the Applicant 90% of the sum of $20,000 and pay the balance of 10% to Medicare Australia.
9	Interest shall not run on the settlement sum if paid within 28 days of this agreement being registered, or within 28 days of any notice of charge of any social security money owing to Centrelink, whichever is the later.
You are hereby requested to record this memorandum, pursuant to Clause 9 of Schedule 4 to the Workers’ Compensation Act 1951 (ACT).

18.	The operative clauses of the Form 28 were;
1	Roza Nocevska named in the Memorandum of Agreement presented for registration in this matter was at the date of settlement 49 years of age.
2	The Applicant was employed as a cleaner, and her average weekly earnings computed in accordance with the Workers Compensation Act 1951 (ACT) (the “Act”) were alleged to be approximately $334.75 gross.
3	The Applicant alleges she suffered personal injury during the course of her employment with the Respondent and the nature of her personal injury was as follows:
(a)	Neck and back injury and pain,; right shoulder and right upper limb injury, chronic musculo-ligamentous and radicular pain, chronic pain syndrome involving psychological and psychiatric reactions;
(b)	anxiety, depression, headaches, sleeplessness and functional overlay.
4	The Applicant was totally incapacitated for work for a period and is fit to resume work.
5	The Applicant received the following payments, allowances or benefits from her employer previous to the date of the agreement, namely:
•	Some payments, allowances or benefits in accordance with the Act.

19.	As well, an undated deed was executed by the worker and registered in the Magistrates Court on 13 June 2007 (“Deed of Release”).  It contained these recitals;
A.	The Releasor alleges that as a result of the negligence of, and/or breach of statutory duty of, and/or breach of contract by the Releasee, the Releasor suffered personal injury or disease or both as set out in Schedule l (the ‘Injuries’) and loss and damage as a result of the Injuries arising out of or in the course of the Releasor’s employment with the Releasee.
B.	The Releasee denies all liability for the Injuries but wishes to avoid the expense and inconvenience of litigation.

20.	After an interpretation clause, the Deed of Release provided;
2	Settlement sum and consideration
In consideration of the Releasee paying to the Releasor the amount of $75,000 plus costs (the ‘Payment’), the Releasor releases the Releasee and provides the indemnity set out in this Deed.
3	Release
The Releasor releases the Releasee from all actions, causes of action, suits, claims, debts, damages, costs and demands at law or in equity or under any statute whether past, present or future, and whether made by the Releasor or persons acting on the Releasor’s behalf in any way arising out of the Injuries. The Releasor may retain compensation paid to the Releasor or on behalf of the Releasor by the Releasee before the date of this deed under the Workers’ Compensation Act 1951 (ACT).
4	Indemnity
The Releasor indemnifies and undertakes at all times to keep indemnified the Releasee, its officers, servants and agents against all actions, suits, proceedings, claims, demands, damages, judgements, costs and expenses which are brought against or incurred by any of them and which are in any way connected with the Injuries (except for the Payment) including but not limited to any claim under any statute or contract by a provider of medical and related services for the costs of those services.
5	Liability of the Releasor for payments
The Releasor acknowledges that the Releasee or its solicitors have informed the Releasor pursuant to section 22(1)(a) of the Health and Other Services (Compensation) Act 1995 (Cth) that the Releasor may be liable to pay amounts under that Act or the Health and Other Services (Compensation) Care Charges Act 1995 (Cth) as a result of the Payment.
6	Authority and undertaking to make deductions and payments
The Releasor acknowledges that the Releasee is authorised to deduct or pay from the Payment any money payable in respect of the Injuries or the proceedings by the Releasor pursuant to the Health and Other Services (Compensation) Act 1995 (Cth) and related Acts. The Releasor undertakes and agrees to pay out of the Payment any money payable by either the Releasor or pursuant to the Health and Other Services (Compensation) Act 1995 (Cth) and related Acts which may not have been deducted from the Payment by the Releasee.
7	Authority to pay
The Releasor authorises and directs the Releasee to pay the Payment to the Releaser’s solicitors detailed in Schedule 2.
EXECUTED as a deed
Schedule I - The Injuries
All injuries, whether they be physically or psychologically sustained by the Releasor during the course of her employment with the Releasee.
Schedule 2 - Details of the Releasor’s solicitors

21.	As noted in the “Worker’s Compensation proceedings – Terms of Settlement” at [15] of these reasons, the total settlement amount was $75,000 clear of any compensation already paid to the worker.  The $75,000 was apportioned between the Form 3.66 which contained the “Settlement Sum” of $55,000 and was attributable to “all physical and psychological injuries suffered by the Applicant arising out of or in the course of her employment with the Respondent on 30 August 2005 and during the entire period of her employment with the Respondent”, whereas the Forms 27 and 28 ascribed $20,000 in relation to any potential injury that might have been suffered by the worker before 1 July 2002.  Both Form 3.66 and Form 27 included words to the effect that the purpose of the $55,000 and $20,000 settlement sums were for the commutation or redemption of the worker’s rights to compensation or entitlements under the Workers Compensation Act.

SUBMISSIONS
22.	At the hearing of these proceedings, Mr Crowe SC of counsel for GIO identified that the facts in issue in the proceedings had at that stage been narrowed so that the relevant material facts relied on by GIO were as follows.  
3.8	On or about 30 August 2005, during the course of her employment with Compass, the Claimant sustained injury whilst unloading a bag of linen from the tray of a 1999 Toyota light truck bearing registration number YUA 15Z (ACT) [“the injury”].
…
3.10	As the injury arose out of the course of the Claimant’s employment with Compass, Compass was liable to make workers compensation payments to the Workers Compensation Act 1951 (ACT). 
3.11	Pursuant to the Workers Compensation Policy, the Plaintiff indemnified Compass and made various payments to the Claimant in accordance with the Workers Compensation Act 1951 (ACT).
3.12	Further, as the injury apparently arose as a consequence of the negligence of Compass, the Claimant was entitled to receive common law damages for the injury.
…
3.18	To avoid litigation, the plaintiff settled the Claimant’s workers compensation and common law entitlements by paying a lump sum to the Claimant [“lump sum”].
3.19	The total sum of payments made by the Plaintiff to and on behalf of the Claimant, including the lump sum, in respect of the injury was $117,065.30 [“the payments”].
3.20	At all material times the Defendant was the ACT Compulsory Third Party insurer of the truck [“the CTP Policy”]. In consideration that Compass would effect with the Defendant certain policies of insurance and would pay to the Defendant certain monies by way of premiums in respect of the same, the Defendant issued ACT Compulsory Third Party Insurance to Compass with respect to the truck.
3.21	It was a term and condition of the CTP Policy issued by the Defendant to Compass that the Defendant would indemnify Compass against liability for injuries caused by the negligence of Compass and which were caused by, or arose out of, the use of the truck.
3.22	Therefore, the CTP Policy indemnified Compass against liability for the injury suffered by the Claimant, as the injury was caused by the negligence of Compass, and arose out of the use of the truck.
3.23	Accordingly, there appears to be two policies of insurance, namely the Workers Compensation Policy and the CTP Policy, indemnifying Compass for the injury suffered by the Claimant and caused by the negligence of Compass.  In the circumstances the Plaintiff is entitled to the recovery from the Defendant of fifty percent of the payments, pursuant to the principles of dual/double insurance.

23.	Mr Crowe SC noted that the defendant admitted the facts alleged in 3.8, 3.9, 3.10, 3.11, 3.18, 3.19 (although the correct sum was $117,032.88), 3.20 and 3.21.  However, the defendant denied 3.12, 3.22 and 3.23. Notwithstanding the denial of 3.12, Mr Campbell SC of Counsel for NRMA Insurance stated that the parties agreed on the existence of the following two facts.  First, had the worker brought and prosecuted a claim for damages in the ACT Supreme Court, she would have established negligence and recovered damages from the employer in excess of the total amount paid by GIO;  secondly, that legal liability would also have arisen out of the use of a registered motor vehicle insured by NRMA Insurance.  
24.	As was made clear by Mr Crowe SC during the course of his submissions, the essence of GIO’s claim is that the lump sum payment to the worker of $75,000, pursuant to the relevant settlement terms contained within Form 3.66, 27 and 28 and the Deed of Release, released the employer from any liability under the Workers Compensation Act and any potential claim for damages at common law.  In Mr Crowe’s submission, it mattered not that a proceeding for common law damages had not in fact been commenced, but, the Deed of Release had discharged the employer from both the actual liability arising under the Workers Compensation Act and the “contingent liability” arising out of a potential claim for common law damages.  That “contingent liability”, so the argument went, was crystallised on the execution of the Deed of Release, clause 3 of which as set out at [20] above was the operative clause discharging the employer’s liability from;
 all actions, causes of action, suits, claims, debts, damages, costs and demands at law or in equity or under any statute whether past, present or future, and whether made by the [worker] or persons acting on the [worker’s] behalf in any way arising out of the Injuries.

Accordingly, the discharge of the worker’s rights to common law damages was said by GIO to be the essence of the creation of the obligation in equity for contribution arising from double insurance.
25.	In his submissions on behalf of NRMA Insurance denying the application of double insurance in these circumstances, Mr Campbell SC contended that any potential claim for common law damages, which he conceded existed, had never crystallised and, the only legal liability which had actually crystallised was a liability under the Workers Compensation Act to pay $75,000 to the worker.  As the statutory compulsory third party insurance policy required under s 171 of the Road Transport Act provided that third party policies did not cover workers compensation payments and as there was no component of common law damages in the settlement sum, there was no double insurance.  Mr Campbell SC submitted that, to determine whether double insurance had application in this instance, it was necessary to ascertain whether the payments made to the worker by way of settlement were payments made entirely pursuant to the Workers Compensation Act or whether there was evidence in the terms of the settlement or elsewhere to indicate that the payments included a component for common law damages. 

DOUBLE INSURANCE
26.	It is worth while to identify the principle of double insurance and its application to circumstances like the present as illustrated by various authorities.  The concept has been helpfully explained in a recent decision by Refshauge J in QBE Insurance (Australia) Ltd v Insurance Australia Ltd (2011) 247 FLR 333; [2011] ACTSC 40 (“QBE Insurance v Insurance Australia”), where his Honour observed, at [57]-[61];
Double Insurance
57	Double insurance occurs when two or more indemnity contracts of insurance cover the identical loss that the identical insured has sustained: Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342 at 352. The general nature of each policy need not be identical so long as each provides indemnity in respect of the relevant risk: Portavon Cinema Co Ltd v Price & Century Insurance Co Ltd [1939] 4 All ER 601 at 604. 
58	Double insurance is the basis upon which an insurer which has met indemnity for the loss occasioned by the happening of the relevant risk can seek contribution from the other insurer or insurers. As was said in Allianz Australia Workers Compensation (NSW) Ltd v NRMA Insurance Ltd (2008) 1 ACTLR 272, 226 FLR 180 at [53]:
“The doctrine is bottomed and fixed on general principles of justice. The reason for contribution is that “in equali jure the law requires equality; one shall not bear the burthen in ease of the rest, and the law is grounded in great equity” (per Lord Chief Baron Eyre in Dering v Early of Winchelsea (1787) 1 Cox 318 at 321; 29 ER 1184 at 1185).”
59	As Barwick CJ, McTiernan and Menzies JJ put it (at 345) in Albion Insurance:
“There is double insurance when an assured is insured against the same risk with two independent insurers. To insure doubly is lawful but the assured cannot recover more than the loss suffered and for which there is indemnity under each of the policies. The insured may claim indemnity from either insurer. However, as both insurers are liable, the doctrine of contribution between insurers has been evolved.” 
60	In Burke v LFOT Pty Ltd (2002) 209 CLR 282, Gaudron A-CJ and Hayne J said (at [14]-[16], [22]):
“Equitable contribution
In general terms, the principle of equitable contribution requires that those who are jointly or severally liable in respect of the same loss or damage should contribute to the compensation payable in respect of that loss or damage, either equally where they are liable in the same amount or proportionately, where the amount of their liability differs. The principle has regularly been applied between co-sureties, co-insurers, partners, co-owners, where payment is made by one in discharge of a common liability, and co-trustees who are in pari delicto.
The doctrine of equitable contribution applies both at common law and in equity. It is usually expressed in terms requiring contribution between parties who share “co-ordinate liabilities” or a “common obligation” to “make good the one loss”. More recently, in BP Petroleum Development Ltd v Esso Petroleum Co Ltd [[1987] SLT 345], the right to contribution was said to depend on whether the liability was “of the same nature and to the same extent”.
The notion of “co-ordinate liability” is one that depends on common interest and common burden. Perhaps because, at common law, there was no general right of contribution between tort-feasors, the notion of “co-ordinate liability” has not traditionally been expressed in terms requiring equal or comparable culpability or a requirement that the acts or omissions of the persons in question be of equal or comparable causal significance to the loss in respect of which contribution is sought. However, the requirement that liability be “of the same nature and to the same extent”, as stated in BP Petroleum, is apt to include notions of equal or comparable culpability and equal or comparable causal significance.
... 
It is unnecessary in this case to further explore the relevance of culpability and the causal significance of the acts and omissions of persons claiming equitable contribution. Similarly, it is unnecessary in this case to further explore how doctrines of equitable contribution operate in connection with particular provisions of Pt VI of the Act [referring to the Trade Practices Act 1974 (Cth)]. That is because the doctrine of equitable contribution is founded on concepts of fairness and justice — “natural justice”, as that term was explained by Kitto J in Albion Insurance Co Ltd v Government Insurance Office (NSW). In this context, “natural justice” requires that if “one of several persons has paid more than his proper share towards discharging a common obligation” he is entitled to be recompensed by those who have not ... [Footnotes omitted]”.
61	The liabilities of insurers are co-ordinate when the insurers are each liable to insure the same insured against the same loss: Accident Compensation Commission v Baltica General Insurance Co Ltd [1993] 1 VR 467 at 481. It does not affect this principle if the cover that the two policies offer are not co-extensive: Bovis Construction Ltd v Commercial Union Assurance Co Plc [2001] 1 Lloyd’s Rep 416.”

27.	On 11 March 2011, Refshauge J delivered reasons for his decision in QBE Insurance v Insurance Australia.  The material facts in that case were very similar to those on which this proceeding are founded.  One of the issues in QBE Insurance v Insurance Australia, and the main issue in the present case, was whether the payment of moneys under the terms of settlement was made pursuant only to the Workers Compensation Act or whether a component of the settlement sum was attributable to a potential claim for damages at common law.  The approach taken by Refshauge J in QBE Insurance v Insurance Australia involved a consideration of the admissible evidence in relation to the settlement.  The relevant terms of settlement in that case were recorded on Workers Compensation Forms 27 and 28 which had been filed in the court so that the compromise was enforceable as a judgment, in much the same way as occurred in these proceedings save that, in these proceedings, there was also a Form 3.66 and a Deed of Release which formed part of the recorded compromise.  
28.	In his consideration of whether the Form 27, which set out the terms of agreement between the relevant parties whereby the claims under the Workers Compensation Act and at common law had been compromised (Form 28’s terms were not relevant to the facts in issue), his Honour took into account a number of factors.  In particular, he considered the principles enunciated in Mercantile Mutual Insurance (Australia) Ltd v QBE Workers Compensation (NSW) Ltd (2004) 61 NSWLR 655 (“MMI v QBE”), summarising a point made in that case as follows;
Where a worker is paid only workers compensation payments (including a lump sum in commutation of the right to continuing weekly payments) there is no identity of liability, for the compulsory third party policy does not cover workers compensation payments.     
To make this point clear, s 171 of the Road Transport (General) Act 1999 (ACT) provided at the relevant time:
(1)	A third-party policy does not insure the owner or driver of a motor vehicle against—
(a) a liability to pay compensation under the Workers Compensation Act 1951 (or any corresponding law of another jurisdiction) to a worker employed by the owner or driver …

29.	His Honour also cited at 353 [131] the judgment of Barrett J in Zurich Australian Ltd v GIO General Ltd (2010) 55 MVR 149 at [7] where it was noted that;
1.	The question of double insurance must be addressed at the date of casualty: AMP Workers’ Compensation Services (NSW) Ltd v QBE Insurance Ltd [2001] NSWCA 267; (2001) 53 NSWLR 35. 
2.	The question of double insurance must be approached by reference to actually crystallised liabilities.  Regard is to be had to burdens actually borne, not to what would or might have been the position if the victim of the casualty or his or her legal advisers had made choices other than those they in fact made and pursued to finality.  This point is emphasised in the judgment of Handley JA (with whom Beazley JA and Tobias JA agreed) in Mercantile Mutual Insurance (Aust) Ltd v QBE Workers Compensation (NSW) Ltd [2004] NSWCA 409; (2004) 61 NSWLR 655 at [22] ... 

30.	In relation to what appears to have been the same argument as to that advanced in the present case, Refshauge J noted at 353 [132] the submission of Mr Campbell SC that, in applying the principles in MMI v QBE, one needs to have regard to the character of the payments made by GIO which is only determinable from the documents registered with the Magistrates Court and from the terms of settlement.   His Honour went on to say;
Mr Campbell SC submitted that para 1 of the Form 27 made it clear that the sum of “$310,000 clear of payments made to date [set out in Form 28] inclusive of costs” was payment for and only for “the applicant’s entitlements … pursuant  to the Workers Compensation Act 1951 (ACT)”. It was not, therefore, for the common law liabilities.  

31.	His Honour then noted the submission of Mr Stretton of Counsel that the facts in the case before him were different from those in MMI v QBE because, in that case, there had been no claim for common law damages.  That, accordingly, distinguished the case from Australian Iron & Steel Pty Ltd v Government Insurance Office (NSW) [1978] 2 NSWLR 59 “where payments for workers compensation were paid but included in the amount to which the compulsory third party insurer was required to contribute”.  Refshauge J, correctly in my view, rejected that argument on the basis that the circumstances in that case were different and continued;                                               
134	In the first place, it stands for the unexceptional principle that since payments of workers compensation entitlements are applied towards payment of any damages otherwise recoverable by a worker (see s 23(2) of the Workers Compensation Act), those payments, when common law damages are recovered, have a dual character, one of which is co-extensive with the amounts in respect of which both insurance policies indemnify the employer.
135	That principle would apply here if the sum paid to Mr Rice by the plaintiff included both common law damages and workers compensation entitlements for the crystallising of the liability for common law damages would change the character of the workers compensation payments so that they would be amenable to the contribution claim by the paying insurer.

32.	Accordingly, as noted at [30] above, the correct approach identified in QBE Insurance v Insurance Australia and applicable to the present case, is to determine the character of the payments made by GIO to the worker by way of settlement.  As I have already pointed out, QBE Insurance v Insurance Australia, concerned injuries sustained before 1 July 2002, and the relevant documents recording the terms of the settlement were Forms 27 and 28.  In construing the terms of settlement, Refshauge J made a number of observations which are of assistance in these proceedings.  
33.	His Honour first noted that Form 27 purported to record the agreement between the parties and stated that the “sum payable is in full and final settlement” of the worker’s entitlement under the Workers Compensation Act, there being no reference at all to common law damages.  His Honour thought that, on its face, that agreement would fall precisely within the principles enunciated in MMI v QBE.   The fact that Form 27 was the prescribed form in use at the time but did not prescribe the contents of the agreement at all was relevant to his Honour’s construction of the agreement.  He considered, at 354 [137], that, as none of the wording in the paragraphs in Form 27 was prescribed, it reinforced “the defendant’s submission that the paragraphs actually set out the true agreement and are not merely an attempt to manipulate its terms into a rigidly and limited prescribed form”. 
34.	Secondly, his honour dealt with a submission from Mr Stretton that, as the settlement had included a common law release, that was consistent with a settlement of the common law damages to which the injured party in that case may have been entitled had such a claim emerged.  His Honour dealt with that submission in the following way at 355-356 [145]-[146] where he said;
… this would inevitably be what a cautious lawyer for the plaintiff would wish to include so that there was no possibility that Mr Rice would make a further claim at any later stage. It is, perhaps, an indication in the agreement as a whole that more it intended in the payment of the settlement sum but it is difficult to see if overcoming the express and clear words in the first paragraph which hardly admit of ambiguity. 
The difficulty I have with Mr Stretton’s argument is that he referred to “an agreement effected in a particular way”, that is a common law compromise for which the Forms 27 and 28 were simply a “vehicle” to give effect to it. There was, however, precise evidence in Form 27 of the terms of the agreement and no evidence of any other agreement. There was, therefore, nothing to show that there was really a prior collateral agreement which was said to be the common law compromise and which was to be effected by filing Forms 27 and 28 which would misdescribe the agreement. Evidence of such a collateral agreement is admissible: see, eg Maybury v Atlantic Union Oil Co Ltd (1953) 89 CLR 507 at 517. This, however, does not seem to be applicable here, for such a collateral contract cannot be inconsistent with the terms of the written contract and what Mr Stretton is positing would be inconsistent with the written terms. 

35.	The relevance of these two observations of Refshauge J will be apparent from the analysis of the settlement documents which I have set out at [36]-[46] of these reasons.

CONSIDERATION
36.	In the current proceedings, there is before me a broader range of documents which are said to constitute the settlement than were in issue in QBE Insurance v Insurance Australia.  As I mentioned previously in these reasons, those documents are Form 3.66, Form 27, Form 28 and the Deed of Release.  There is also what might be described as a prior collateral agreement in the “Worker’s Compensation proceedings – Terms of Settlement” which is recited at [15] of these reasons.  It is clear from the reasons in QBE Insurance v Insurance Australia and MMI v QBE that the task of the Court is to construe the documents in order to characterise the payments made to the worker.  If it can be said that the payments include a component for common law damages, then double insurance principles will apply.  I now turn to the proper construction of the settlement terms. 
37.	I have set out at [15]-[21] the relevant terms of the documents which comprise the settlement and the ancillary agreement.  In the “Worker’s Compensation proceedings – Terms of Settlement” there was no reference to common law damages other than a box ticked to indicate that the parties intended that a common law release was to be executed in relation to the list of injuries.  The settlement amount of $75,000 was said in that document to commute or redeem the worker’s rights under the Workers Compensation Act in relation to the injuries listed there.  In my view, although the document is in a prescribed form, the form used does not prescribe the contents of the agreement and, in accordance with Refshauge J’s view in QBE Insurance v Insurance Australia at 354 [137], none of the wording in the paragraphs in this form was prescribed. The inclusion of hand written amendments suggests to me the paragraphs set out the intentions of the parties.  In my view, the fact that the document contains a section which would have been the appropriate place at which to have set out details of common law proceedings, had they existed, or where an annotation could have been made to make clear that the amount of the settlement was inclusive of common law damages, adds some additional weight to my view that the settlement sum, at that stage, was not intended to be inclusive of potential common law damages.
38.	 I note however that the “Workers Compensation proceedings Terms of Settlement” document was not part of the material registered with the Court.  Rather, it was an ancillary agreement which was binding on the parties at the time it was made and was likely to have been executed in order to frame the terms on which the prescribed forms (Forms 3.66, 27, 28 and the Deed of Release) were to be based.  I consider this document of assistance only in so far as it casts some light on the intentions of GIO and the worker at that stage of the settlement process.  
39.	Form 3.66 contains no reference to common law damages.  What might be called a recital in the opening paragraph of that form describes the agreement embodied in it, as one for commutation of the worker’s “rights to compensation under the Workers Compensation Act”.  The “Settlement Sum” described in that agreement was $55,000 less a 10% payment to be made to Medicare Australia. Throughout the terms of the agreement, there are references to the applicant (the worker) commuting rights to compensation under the Workers Compensation Act.   In my view, it is clear from Form 3.66 that each reference to a commutation is made in relation to the Workers Compensation Act and not common law damages.  Although Form 3.66 was a prescribed form, the words contained in its paragraphs were not prescribed and the opportunity was clearly available to the parties to the agreement to state that the commutation was under the Workers Compensation Act or any other Act or the common law.   Accordingly, Form 3.66 must be read as it is expressed, namely as affecting only a commutation of the worker’s rights under the Workers Compensation Act and not a settlement of any separate common law claim.  
40.	Form 28 does not assist in a determination of the nature of the settlement sum which has been paid to the worker and Form 27 is expressed as an agreement;
to pay to the [worker] the sum of $20,000 in full and final settlement and redemption of the applicant’s entitlements for all physical and psychological injuries sustained by the applicant during the entire period of her employment with the respondent pursuant to the provisions of the Workers Compensation Act 1951 (ACT) (the ‘Act’).

This document is of the same type as that considered by Refshauge J in QBE Insurance v Insurance Australia and contains almost identical terms.  At clause 2 of the agreement the following terms appear: “The applicant accepts the sum of $20,000 in full satisfaction of the claim inclusive of all expenses arising out of her work injuries.” (emphasis added).  The only claim actually made by the worker was one under the Workers Compensation Act.  In my view, this document contains quite unambiguous terms which make clear that the $20,000 settlement sum was attributable to the Workers Compensation Act claim.  For the same reasons which I have explained in relation to both the “Worker’s Compensation proceedings – Terms of Settlement” and Form 3.66 at [38]-[39] above and in accordance with the reasons expressed by Refshauge J at 354 [136]-[137] in QBE Insurance v Insurance Australia, the ability of the parties to amend the prescribed form to include any terms they wished, as, indeed, they did in the Form 27, reinforces my view that the paragraphs set out the true intentions of the parties at the time when this agreement was entered into and registered with the Court. 
41.	For the same reasons which Refshauge J has set out at 355 [145]-[146] of his judgment, which are recited at [34] above, I consider that clause 4 of Form 27, which stipulates that the worker “will execute a common law release”, does not alter the fact that the settlement sum of $20,000 was to be paid pursuant to the provisions of the Workers Compensation Act and in full and final satisfaction of the claim under that Act. 
42.	A fundamental aspect of GIO’s submissions was that MMI v QBE is distinguishable from the current proceeding on the basis that, in that case, the absence of a common law deed of release was significant in leading Handley J (with whom Beazley and Tobias JJA agreed) to conclude, at 659 [18], following the dicta of Glass JA in Australian Iron & Steel Pty Ltd v Government Insurance Office (NSW) [1978] 2 NSWLR 59, that;
Payments of compensation only had this dual character “if damages were later recovered”.  In the present case this did not happen and the payments were made by the respondent in discharge of a liability to pay compensation and not otherwise. This liability was not insured by the appellant under its motor vehicle policy.

43.	In Mr Crowe SC’s submission, the Deed of Release in the present matter was executed to extinguish any potential future common law or other form of claim by the worker.  Accordingly, by contrast with MMI v QBE, the potential liability of the employer to pay common law damages was crystallised on execution of the Deed of Release which crystallised the liability in consideration of a payment of $75,000 clear of the compensation already paid.  I am not persuaded by this argument. 
44.	As I perceive it, MMI v QBE and the recently decided QBE Insurance v Insurance Australia are indistinguishable from this case.  The fact that a Deed of Release has been executed is not determinative of the characterisation of the payments made under the terms of the settlement.  As already noted, I have adopted the reasoning of Refshauge J in QBE Insurance v Insurance Australia, to conclude that, in construing the terms of the settlement documents as a whole, with reference also to the document headed “Worker’s Compensation proceedings – Terms of Settlement”, one needs to determine whether the sum paid to the injured party by the insurer included both a workers compensation component and common law damages.  Only if a finding to that effect is made can it be said that there was a crystallisation of the liability for common law damages and, in my view, the execution of a deed of release did not, of itself, crystallise that liability.  
45.	In assessing whether the Deed of Release could be said to have “crystallised” a common law claim, it is necessary to consider the wording negotiated and incorporated by the parties.  It is true that Form 3.66 and Form 27 apportion $55,000 to a commutation or redemption under the Workers Compensation Act, in respect of an injury suffered on 30 August 2005 and $20,000 to commutation or redemption under the same Act in respect of any injury which might have been suffered before 1 July 2002.  However, the Deed of Release, particularly cl 3, which contains the release and cl 4 which grants the indemnity is in very broad terms purporting to release the employer from all liability in consideration of the payment of $75,000.  There was no apportionment of the $75,000 in the Deed of Release to any specific claim, but it was couched in terms which would cover any past, present or future claim of any kind in relation to the injuries sustained by the worker. That is what Mr Crowe SC contended crystallised the liability to common law damages, on the basis that the employer had bought from the worker a release of her entitlement to common law damages.  Again, I am not persuaded by this argument.
46.	In my view, the apportionment of the settlement sum of $75,000, less any payments already made, was effected quite clearly by the terms of Form 3.66 and Form 27.  Those sums were by way of a commutation or redemption of the worker’s rights under the Workers Compensation Act and were not related in any way to common law damages.  The Deed of Release released the employer from any current or future claims in relation to the injuries whether they were pursuant to any statute or under the common law.  The Deed of Release was not in any prescribed form and it did not ascribe any portion of the settlement sum to any common law damages claim whether already made or arising in the future. 
47.	In this case, no claim for common law damages had been made at the time of the settlement.  If the employer had considered it necessary to do so, it could have specified in the settlement documents that a portion of the settlement sum was paid pursuant to the potential common law liability.  Without such an apportionment of the settlement sum to any potential common law liability, the relevant evidence available to the Court is only that contained within the settlement documents.  Here, the terms of Form 3.66 and Form 27 clearly stipulated that the settlement sum was in full and final settlement of the worker’s entitlements under the Workers Compensation Act.  This was supported by the document entitled “Worker’s Compensation proceedings – Terms of Settlement”.  The Deed of Release did not contradict that stipulation.  It merely released any potential uncrystallised liability. Accordingly, it could not be said that the Deed of Release crystallised any common law liability.   
48.	Finally, I note that, in his submissions on the hearing, Mr Crowe SC argued that the letter of 16 October 2006 from the solicitors for GIO to NRMA Insurance set out at [7] of these reasons, which put NRMA Insurance on notice of the potential claim for common law damages and preserved GIO’s position in relation to that potential claim, should be given some significance in construing the settlement terms and characterising the nature of the payments made.  In Mr Crowe’s submission, that letter to NRMA Insurance made it clear that it was within the contemplation of all parties that there was a potential exposure to a common law claim.  That potential common law claim, it was submitted, was expected to be pursued and, accordingly, GIO had acted promptly in negotiating a settlement to extinguish the potential claim by executing the settlement documents which included the Deed of Release.  
49.	In my view, the notification between insurers of a potential liability has no bearing on the nature of the sum paid under the settlement unless the terms of the settlement stipulate that the sum is in settlement of any common law damages claim.  As Refshauge J said in QBE Insurance v Insurance Australia at 355- [145], in a passage adopted at [34] of these reasons, “… this would inevitably be what a cautious lawyer for the plaintiff would wish to include so that there was no possibility that [the worker] would make a further claim at any later stage.”  In the present case the hypothetical nature of the common law claim was recognised in the letter written by each insurer.

CONCLUSION
50.	As I have endeavoured to explain, on the evidence before me and taking into account the settlement terms contained in Form 3.66, Form 27, Form 28 and the Deed of Release as well as the document headed “Worker’s Compensation proceedings – Terms of Settlement”, I consider that GIO’s claim for contribution payment from NRMA Insurance in accordance with the principles of double insurance must fail.  I am not persuaded that any aspect of the settlement amount of $75,000, less payments already made, was pursuant to anything but the Workers Compensation Act.  There was no crystallisation of the common law liability.
51.	As a result of these conclusions, GIO’s claim must be dismissed with costs.
I certify that the preceding fifty-one (51) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan.

Associate:

Date:	2 June 2011 

Counsel for the plaintiff:	Mr R L Crowe SC
Solicitor for the plaintiff:	Sparke Helmore
Counsel for the defendant:	Mr S Campbell SC with Mr S Pilkinton
Solicitor for the defendant:	Moray Agnew
Date of hearing:	18 October 2010.
Date of judgment:	2 June 2011