Insurance in MOtion – Substance over form

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In a reminder that substance matters over form, a company that was not itself the employer, was held 60% liable for the injuries suffered by an injured worker due the control it exercised over the working environment.

On 2 May 2011 the plaintiff was severely injured while unloading timber beams from a shipping container at the premises of his employer, RTS Holdings Pty Ltd. The plaintiff sued RTS as his employer and a second company, Strategic Formwork Pty Ltd which he said exercised control over RTS.

The NSW Court of Appeal confirmed the primary Judge’s decision that Strategic, which was not the employer of the plaintiff but was a related company, nonetheless owed him a duty of care. The Court accepted that Strategic controlled the plaintiff’s work activities, and that its director was responsible for devising the system of work and overseeing all activities undertaken by the employer relating to the occupational health and safety of its employees.

The Court reached this conclusion even though the accident occurred in the course of undertaking work for his employer, the work was undertaken on the employer’s property, and Strategic, as a related third party company, was not even present at the time of incident.

This potentially broadens the scope of those parties which may be held responsible for workplace injuries. In some circumstances at least, the Court is willing look at who is the author responsible for directing the manner in which work is undertaken.

Strategic Formwork Pty Limited v Hitchens (2018) NSWCA 54

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    Tightened complaint handling procedures aimed at ensuring “fair, timely and effective dispute resolution” ASIC Regulatory Guide 271: Internal Dispute Resolution