Air Link Pty Ltd v Paterson

[2004] HCATrans 394

[2004] HCATrans 394

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S534 of 2003

B e t w e e n -

AIR LINK PTY LIMITED

Applicant

and

MALCOLM IAN PATERSON

Respondent

Application for special leave to appeal

GLEESON CJ
HAYNE J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 8 OCTOBER 2004, AT 12.05 PM

Copyright in the High Court of Australia

MR R.F. MARGO, SC:   May it please your Honours, I appear with MR M.J. LEEMING and MR R.M. PETERS, for the applicant, Air Link.  (instructed by Norton White)

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friend, MR P.A. REGATTIERI, for the respondent.  (instructed by M.J. Duffy & Sons)

GLEESON CJ:   We thought we would be assisted if we were to hear from you, Mr Jackson.

MR JACKSON:   Yes, thank you, your Honour.  Your Honour, in our submission, special leave should be refused for two related reasons.  The first is, in our submission, that there is not sufficient doubt as to the correctness of the decision of the Court of Appeal.  In support of that, may I say these things. 

There are relevantly two enactments dealing with the liability of carriers to air passengers who are injured in a State, in particular, in New South Wales.  They are the Commonwealth statute, the Civil Aviation (Carriers’ Liability) Act 1959, and Part IV of that Act applies that the journey is an interstate journey. The second is the Civil Aviation (Carriers’ Liability) Act 1967 (NSW), and by section 5 of that Act the equivalent parts of the Commonwealth Act are adopted as laws of the State. They are simply adopted but not in any relevant respect altered. That applies if the journey is intrastate and the content of the two laws is exactly the same in each case.

Now, your Honours, 20 years ago in Proctor v Jetway Aviation Pty Ltd [1984] 1 NSWLR 166 the New South Wales Court of Appeal held that an equivalent to the rule in question applied to allow amendment in circumstances not materially different from those in question here. Special leave was refused, 155 CLR 692. That meant, your Honours, that the relevant provision of the rules applied to section 34, adopted as a law of New South Wales but a provision in exactly the same terms.

Now, your Honours, it has been accepted in the present case that because the journey commenced and was to end in Queensland the Commonwealth section 34, rather than the State section 34, applied.  That meant that the District Court was exercising federal jurisdiction invested by section 39(2) of the Judiciary Act of course and that the jurisdiction being federal, section 79 of the Judiciary Act applied.  It said, your Honours, of course, that the laws of New South Wales were binding on the court, and that includes, of course, binding on the parties to the court, in the exercise of that federal jurisdiction.

Now, your Honours, if one took the operative part of the text of section 79, and by that I mean the part of section 79 that says:

The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall . . . be binding on all Courts exercising federal jurisdiction –

et cetera.  It would say that the amendment provisions of the District Court Rules are binding and that would include, in our submission, the approach in Proctor in relation to the same provision.  Your Honours, one then comes to the question, is there an inconsistency with section 34 of the Commonwealth Act in terms of section ‑ ‑ ‑

HAYNE J:   Whether there is an “otherwise” provided.

MR JACKSON:   Yes, I was going to say, your Honour, it is one or the other.  The answer would seem to be the same in either case.  Your Honours, could I say, if one goes to section 34 of the Commonwealth Act, what it does do is to require the bringing of an action within two years in respect of a liability for damages for personal injury, an action which was for personal injury was brought, no claim other than a claim under either the Commonwealth or the State Act could be brought because of section 36 of the Act.  So it had to be any claim in relation to the aircraft had to be an act either under the State Act or the federal Act.

The initiating proceeding in the present case was held to be defective because it did not contain a reference to the fact that the applicant held an airline licence or to the fact that the contract was for interstate carriage, and, of course, there was surplusage.  But, your Honours, one is not talking about a case where no proceeding is instituted within the two years and it is difficult, in our submission, to see that section 34 was intended to cut out cases where proceedings have been instituted.

HAYNE J:   Any proceeding that must be, must it?

MR JACKSON:   I am sorry, your Honour?

HAYNE J:   Any proceeding seeking damages for personal injury.

MR JACKSON:   Your Honour, if one takes the fundamental surrounding law, one has a situation where in respect of aircraft injuries, if I could put it shortly, there is only one cause of action.  The cause of action arises either under a State law or the federal law.  It is exactly the same apart from the source of the power.

Your Honours, what I was going to say was just this, that the decisions of the Court of Appeal in Victoria in Agtrack and in the New South Wales Court of Appeal in this case, in our submission, are to similar effect.  They are not sufficiently attended by doubt, we would submit, to merit the grant of special leave.

HAYNE J:   Well, do you support the reasoning of the Court of Appeal about section 79?

MR JACKSON:   Yes, your Honour.  By that I mean what I support is this, your Honours, that the effect of section 79 is that it does not just apply to laws which are capable of description for one purpose or another as procedural, but it applies the laws of the State except to the extent that they are inconsistent, or they are inconsistent with the Commonwealth provision, to put it shortly.

Your Honours, could we just say – this is the second point – something in relation to the great questions of importance said to be involved.  As we submitted earlier, there is a parallel Commonwealth and State set of legislation.  The legislation does not differ.  There is only one identical cause of action – others are excluded – the same defendant, the same plaintiff, the same damages and, your Honours, the same compulsory insurer, one would expect, compulsory by the statute.  The only difference is whether the award is made in the exercise of federal or State jurisdiction. 

The nature of the issue involved, in our submission, is really less high policy than the establishment of what is really a technicality, in order to avoid having a foot in either camp. Your Honours, our submission is that not every case involving the Constitution or section 79 needs to be decided by this Court. The last thing I would say, your Honours, is this, that if this Court were minded to grant special leave, the grant should be on terms without costs to be paid in any event.

GLEESON CJ:   Mr Margo, two questions.  First of all, what do you say about that concluding submission concerning terms on which a grant of special leave might be made?

MR MARGO:   Your Honours, we submit it is not appropriate in this case.  It is an unusual order in private litigation.  This is not a case where we have a large industry player or somebody like Nintendo or the Crown seeking to test principles of no interest to the respondent.  There is no evidence or suggestion that the applicant in Air Link, and for that matter in Agtrack, where no such special costs order was sought, is other than they appear to be on the papers, which is a private proprietary company operating a regional country airline out of Dubbo.  The fact that lawyers have drawn attention to wider public aspects of the special leave questions in support of the application ‑ ‑ ‑

HAYNE J:   There was some reference, I thought, to compulsory insurance, was there?  Is there some provision about compulsory insurance?

MR MARGO:   Well, there is in the Act, and your Honours would infer from the fact that these are airline companies that there are insurers standing behind them, but a similar inference could be drawn ‑ ‑ ‑

HAYNE J:   I thought you were saying to us that we should treat them as private individuals, private airline companies, Mr Margo.  Was that what you were putting to us?

MR MARGO:   I was going to come on to insurance.  Your Honours could infer that there are insurers standing behind these companies because they are airline companies, but an inference could similarly be drawn that there are insurers standing behind the solicitors in this case.  There is no evidence that the respondents would be unable to be well represented or to assist the Court without such a special condition.  If your Honours are against me, I submit that the appropriate course is the one your Honours adopted in Nintendo, to defer the question of costs until the appeal, but to make it clear on granting of the special leave that the ordinary costs order may not be made even if the appellant is successful.

GLEESON CJ:   The second matter related to your draft notice of appeal.

HAYNE J:   Eleven grounds, not exactly artfully drawn in a way that would isolate with clarity the point of principle that is at stake.

MR MARGO:   Your Honours, the key special leave question, the threshold question, and the one which would determine everything if decided the way we contend is the construction of the Commonwealth Act.  One does not need to get to the validity or otherwise of the District Court Rules unless your Honours are against us on the construction point.  If the construction point were decided the way we contend, inconsistency under governing clause 5, 109, University of Wollongong v Metwally or section 79 would be indisputable, in our submission.  But if your Honours were against us on construction, we do wish to preserve on the appeal the question of how far these rules can reach.

It is not a matter which does not have some pedigree.  Your Honour the Chief Justice, when Chief Justice of the New South Wales Court of Appeal, referred to the caution that needs to be exercised in construing a rule of court allowing a court by a discretionary decision to set at naught a limitation statute ‑ ‑ ‑

HAYNE J:   But, Mr Margo, the point I want to draw to your attention is a ground like paragraph 8 at page 148 or a ground like grounds 9 and 10 – and I give those as examples – do not isolate with any clarity the point which it is sought to agitate:

erred in law in not construing Part IV . . . in its context in the whole of the Act –

It does not tell you what the positive case is.  It just says they did not get it right.  We know the appellant says it did not get it right.

MR MARGO:   I am sorry, your Honour.  That is the inexpertise of the draftsman in this matter.  The point sought to be made is that the words in section 34 “action . . . brought . . . within two years” and “extinguishment” should be construed with the same meaning that those words bear in Part II, Part III, Part IIIC of the Act.

GLEESON CJ:   But 8, 9, 10 and 11 look less like grounds of appeal than reasons of argument.

MR MARGO:   If your Honours were to grant special leave, if you were so minded, on condition that a curtailed and more satisfactory drafted notice of appeal be prepared, and we would accept such a condition ‑ ‑ ‑

GLEESON CJ:   Well, we will just indicate to you, Mr Margo, that if we were minded to grant special leave to appeal, elimination of some of those grounds of appeal which are of an argumentative nature might lead to a smoother passage at a future time.

MR MARGO:   Certainly that will be attended to, your Honour.  Your Honour, the central question is the way that the court below was able to avoid inconsistency was that the learned President said the Convention cases do not apply to Part IV, which is concerned with domestic carriage.  In our submission, if one applies Ten Network v Channel Nine construction principles to this Act and one looks at the repeated references to the intention of the scheme in the second reading speech, that a contrary conclusion should be reached, that Part IV should be construed in the way that Article 29 wording is construed when imported by other sections of the Act.

The consequence if that were not done is that a State rule carves out a different area within a Commonwealth Act that was intended to establish a uniform certain regime that covered the whole of air carriage within federal constitutional jurisdiction.  Aircraft do not know whether they are in New South Wales or South Australia.  If the court below is correct and if Proctor is to govern the interpretation of the rest of the Commonwealth Act, then passengers on a flight between Sydney and Melbourne would have different rights and consequences depending on how far their tickets eventually carry them.

Not only that, but one imports, if the decision of the courts below stand, all sorts of conflict of laws problems because not all States have the same amendment rules, as the learned President pointed out.  Western Australia, certainly at that date, did not have an equivalent Weldon v Neal overcoming primary statutory backing provision.  So if under Pfeiffer the court in New South Wales was asked to apply Victorian law with a lex loci delicti, does that pick up the Victorian – I am sorry, Western Australia I should use as an example – the Western Australian rules, which would not be able to be used without primary backing of the authority of Morgan v Banning or does one apply its own rule to grant extensions or amendments relating back?

The clear intention of the Commonwealth Act, in our respectful submission, when one looks carefully at it and its internal contextual considerations, it is the second reading speech, is to apply a uniform certain regime across the whole of Commonwealth air carriage – air carriage within Commonwealth federal constitutional power.

As to Air Link (No 1), your Honours, this Court, if it makes a difference, is bound, as we understand, by the decision in Air Link (No 1).  No special leave was sought in respect of that decision.  There the Court of Appeal in New South Wales held unanimously that action brought within section 34 means an action brought under Part IV of the statute.  Secondly, they held that the statement of claim in this case did not bring an action within the meaning of section 34.

GLEESON CJ:   What do you mean this Court is bound?

MR MARGO:   The decision of the court below was a sequel to an earlier decision in the same proceedings, Air Link (No 1), which concerned the adequacy of the pleading.

GLEESON CJ:   I know about that but ‑ ‑ ‑

MR MARGO:   No special leave was sought to appeal against that decision.

GLEESON CJ:   Just a minute.  That question squarely arises in the Agtrack matter, does it not?  Is there not a question that was raised in relation to Agtrack, resolved I think, or assumed perhaps, in your favour?  There is a real question in Agtrack, is there not, as to whether or not the

original statement of claim did not sufficiently plead a cause of action under the Act?

MR MARGO:   There was in your Honours’ minds when the hearing of the application ‑ ‑ ‑

GLEESON CJ:   Now, assuming it remains in our minds, in what sense are we bound by the decision of Air Link (No 1)?

MR MARGO:   In Agtrack your Honours are not bound at all.  In Air Link ‑ ‑ ‑

GLEESON CJ:   Or in this case.

MR MARGO:   I was just replying, or answering ‑ ‑ ‑

GLEESON CJ:   You mean there is some kind of issue estoppel in this case?

MR MARGO:   Yes, unless your Honours grant the respondent leave to cross-appeal to challenge Air Link (No 1), which your Honours might be minded to do if you granted us leave.  But I was just responding to my learned friend’s submissions to the effect that this was in substance a bringing of a proceeding within section 34.  There is a unanimous finding of a differently constituted court, but with two common members, that that is not the case, that “action” in section 34 means action under Part IV and that the statement of claim in Air Link did not bring such an action within two years.

GLEESON CJ:   We will clear it up with Mr Jackson.  Mr Jackson, I do not know whether you followed this other case of Agtrack.

MR JACKSON:   Yes, your Honour.  I am familiar with the point your Honour is making.  Your Honour, if the Court were minded to grant special leave in relation to this matter, we may well take the course of seeking an extension of time within which to apply to challenge the first decision, if that be necessary – for the first decision in this case.

GLEESON CJ:   We do not have to deal with that now.

MR JACKSON:   No, your Honour.  Your Honour, could I just say in relation to the question of costs, the relevant provision of the Commonwealth Act is stated in Part IVA.  Perhaps it is only necessary to go to section 41, which sets out the object of the part, which is:

to require carriers to hold, in respect of carriage to which –

amongst other things ‑

Part IV applies, insurance that will ensure, as far as practicable, that compensation within the limits of liability prescribed by this Act will be paid in respect of death or personal injury suffered by passengers on aircraft.

And there are various provisions involving some condign sanctions if that is not ‑ ‑ ‑

HAYNE J:   Now, why should the presence of insurance lead to a special costs order?

MR JACKSON:   Your Honour, it should for this reason.  Your Honours will see that in the applicant’s summary of argument that one of the bases relied on for the grant of special leave – and I am referring, your Honour, I think to about paragraph 54 or so at page 159.  Your Honours will see that the question is said in paragraph 55 to be:

of general importance to passengers, carriers and their respective insurers, both in this country and abroad.

That is one of the bases for the application.  In our submission, it is an appropriate case in those circumstances for such an order.  Could I say, your Honours, that the provisions of Part IVA, the insurance provisions, are also picked up by the State Acts. 

GLEESON CJ:   Yes, thank you.  In this matter there will be a grant of special leave to appeal.  We will note that the respondent has foreshadowed that in the event that an appeal is allowed the respondent will seek a special order as to costs and we will leave that course open to the respondent to pursue at the hearing of the appeal.  Mr Margo, you will give some thought to whether 78B notices are necessary?

MR MARGO:   …..certainly in New South Wales – and I am told that they were given, but they did not want to prepare it on the special leave application, but now that leave has been granted, there will be.

GLEESON CJ:   How long will argument take – how long did argument take in the Court of Appeal in this matter?

MR MARGO:   Two days, your Honour.  That was with the Solicitor‑General present.

GLEESON CJ:   All right.  Then we are going to give a similar grant of special leave in relation to the next case in the list and they will be listed together and we will assume that it will be necessary to allow two days for them both together.  Perhaps counsel in the two cases – I know you are common to both cases, Mr Margo – can agree between themselves on some kind of division as to time.

AT 12.26 PM THE MATTER WAS CONCLUDED