Alexander & Ors T/as Minter Ellison v Perpetual Trustees WA Limited & Anor S179/2001

[2002] HCATrans 629

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S179 of 2001

B e t w e e n -

CHARLES DELIUS SOMERVILLE ALEXANDER & ORS T/as MINTER ELLISON (see Schedule 2)

Applicants

and

PERPETUAL TRUSTEES WA LIMITED

First Respondent

PERPETUAL TRUSTEES COMPANY LIMITED

Application for special leave to appeal

GAUDRON J
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 13 DECEMBER 2002, AT 11.12 AM

Copyright in the High Court of Australia

MR I.M. JACKMAN, SC:   May it please the Court, I appear for the applicants in this matter.  (instructed by Mallesons Stephen Jaques)

MR S.D. ROBB, QC:   May it please the Court, I appear for the respondents.  (instructed by Phillips Fox)

GAUDRON J:   Now, I understand counsel have been informed that Justice Gummow and I know one or other of the applicants in this matter and that there is no objection to our determining this application.

MR JACKMAN:   That is correct, your Honour.

MR ROBB:   That is certainly correct on our…..your Honour.

GAUDRON J:   Thank you.

MR JACKMAN:   Your Honours, in these proceedings, a group of investors suffered loss in respect of the collapse of a money market investment fund.  The investors themselves had a direct right of action for their loss against the two perpetual companies who acted as trustees for them in making the investment.  The investors’ loss was also attributable to the solicitors, my clients, who acted as trustees at settlement of the investment.  The action against my clients was brought entirely properly by way of cross-claim by the two perpetual companies in their capacity as trustees for the underlying investors.

GAUDRON J:   Can I take you back to the first thing I thought you said.  Did you say that the investors had a direct right of action against your clients?

MR JACKMAN:   No, against the two perpetual companies.

GAUDRON J:   Yes.

MR JACKMAN:   That is so.  No action was run on the basis that they ‑ ‑ ‑

GAUDRON J:   No, but did they have a right of action?  Do you say they had a right of action?

MR JACKMAN:   No, I do not say that.  I do not say that the underlying investors themselves had a right of action.  There are exceptional cases, of course, in which beneficiaries are entitled to sue rather than the trustees suing, but I do not submit that this is one of those cases.  

GUMMOW J:   Are we right in thinking, Mr Jackman, that this application turns on Part IV of the Victorian Act, its contribution under Part IV?

MR JACKMAN:   Yes, that is so.  When the application was first made it was put also on the basis of equitable contribution but that is no longer the case.  It is put only on the basis of statutory contribution under the Victorian Act.

GUMMOW J:   Yes.  Now, assuming one construed the Victorian Act as you want us to construe it, how would that get into this New South Wales action?  This case was tried in the Supreme Court of New South Wales.

MR JACKMAN:   Yes, that has ‑ ‑ ‑

GUMMOW J:   The Victorian Act does not tell us anything about where it applies.

MR JACKSON:   No, that is so.  The parties below treated – it was common ground between the parties that ‑ ‑ ‑

GUMMOW J:   This is some freestanding statutory right, is it not, of contribution?

MR JACKMAN:   It is and ‑ ‑ ‑

GUMMOW J:   Yes, perhaps it will get litigated in New South Wales.

MR JACKMAN:   The Victorian law was regarded by both parties below as the appropriate choice of law.

GUMMOW J:   Choice of law of what?

MR JACKMAN:   Choice of law governing the claim for contribution.

GUMMOW J:   In equity?

MR JACKMAN:   Well, this is now by statute, that is, that the lex causa for the statutory contribution claim was the Victorian statute rather than the New South Wales statute, the significance lying in the fact that the New South Wales statute is confined to tortfeasors.

GUMMOW J:   Yes, it is not good enough for you.

MR JACKMAN:   Quite, but there was no issue below.  We deal with it ‑ ‑ ‑

GAUDRON J:   That is based on the breach of trust by your client having occurred in Victoria?

MR JACKMAN:   Yes, that is so.  We deal with it in our written submissions, your Honours ‑ ‑ ‑

GAUDRON J:   Then you have to say that the Wrongs Act is part of the substantive law of Victoria.

MR JACKMAN:   Yes, that is so, we do say that.

GAUDRON J:   You say that?

MR JACKMAN:   We deal with this point in paragraph 10 of our written submissions on page 436 of the application book.

GUMMOW J:   I mean, it may not have been agitated below, but you want special leave, so you have to bare your breast a bit.

MR JACKMAN:   Indeed.  Well, I am prepared to ‑ ‑ ‑

GUMMOW J:   What page was it?

MR JACKMAN:   It is page 436.

GUMMOW J:   Which paragraph, Mr Jackman?

MR JACKMAN:   Paragraph 10.  We refer to the lack of any dispute as to the Wrongs Act applied as a matter of appropriate choice of substantive law.  We give reference to Pfeiffer v Rogerson on this point where there is a reference to claims for contribution.  I have not brought that authority to Court, not having anticipated this point arising.  But we then point out that the respondents, the Perpetual Companies abandoned a ground of appeal on that issue and then, for good measure, we point out why that abandonment was correctly made, namely that my clients’ breaches of duty occurred in Victoria, the trust relating to the receipt of the moneys by my clients derived from the subscription agreements which were expressly governed by Victorian law and there was a misleading conduct case brought against my clients by the Perpetual Companies under the Victorian Fair Trading Act.  So for those reasons, the parties approached the case, in my submission correctly, on the basis that the Victorian statute rather than the New South Wales statute governed the substantive question of the availability of a right of contribution.

Now, it is fair to say, as the Court of Appeal does say, that the trial judge was equally scathing of the conduct of both the Perpetual Companies and of my clients.  In the result, his Honour the trial judge declined an order for contribution and the orders that were made dealing with pecuniary relief between the parties before the Court are to be found at page 319 of the application book.  If I can take your Honours briefly to page 319, the relevant orders are 8 and 9 which, in effect, provide for judgment for each of the two Perpetual Companies against my clients in a combined sum of about $12.5 million, but on terms that the Perpetual Companies apply that money to replenish the relevant trust funds or to pay the plaintiffs - that is the trust of which the Perpetual Companies were respectively trustees.  Now, that reflects the fact that the damage was suffered by the underlying investors, not the Perpetual Trustee Companies, and so that the pecuniary relief that was awarded was quite properly treated as payable to the Perpetual Trustee Companies but only on terms that they apply that money to replenish the trust funds or the plaintiffs who were among the underlying investors.

GUMMOW J:   What is the actual provision we are construing in the Victorian Act?

MR JACKMAN:   I was about to go to that.  There are really four provisions.  Can I take your Honours first to section 23B(1) which governs the availability in principle of contribution and provides:

Subject to the following provisions of this section, a person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage –

One then goes secondly to section 23B(6) which provides:

References in this section to a person’s liability in respect of any damage are references to any such liability which has been or could be established in an action brought against that person in Victoria by or on behalf of the person who suffered the damage –

and we emphasise the words “or on behalf of the person who suffered the damage”.  Then if one goes back to ‑ ‑ ‑

GUMMOW J:   The concluding words are interesting too.

MR JACKMAN:   Indeed.

GUMMOW J:   Where do we go then?

MR JACKMAN:   Then section 23A(1).  The drafting is not neat but this is also a provision that throws light on the meaning of “liable in respect of any damage” and it provides that:

for the purpose of this Part a person is liable in respect of any damage if the person who suffered that damage, or anyone representing the estate or dependents of that person, is entitled to recover compensation from the first-mentioned person in respect of that damage whatever the legal basis of liability, whether tort, breach of contract, breach of trust or otherwise.

The word “entitlement” there in order to make it consistent with section 23B(6) must be read as having a wide meaning, that is, a direct entitlement by the person who suffered being himself or herself the plaintiff or, alternatively, an indirect entitlement by reason of the fact that the plaintiff is someone suing on behalf of the person ‑ ‑ ‑

GAUDRON J:   It does not exactly say “on behalf of”, does it, in subsection (1)?

MR JACKMAN:   No, it does not, it does in ‑ ‑ ‑

GAUDRON J:   It says:

representing the estate or dependents ‑ ‑ ‑

MR JACKMAN:   That is so, your Honour.

GAUDRON J:   Now, the trustee companies were not doing this, were they?

MR JACKMAN:   We do put a secondary submission that they were representing the estate of the person.  That is construing the word “estate” as meaning in a broad sense the property of, rather than simply a reference to a deceased estate.  That is a secondary submission we put.  The primary submission is that the word “entitled” is sufficiently wide, particularly having regard to section 23B(6), to cover a direct or an indirect entitlement, that is, the person who suffered the loss need not be the plaintiff who is suing for the loss.

GAUDRON J:   So your primary case is this, is it, that the ultimate losers in this case could by joining the trustee companies have sued your clients who would then have been liable?

MR JACKMAN:   Well, we need not put it that strongly, that is, we need not demonstrate that the beneficiaries themselves could have been the plaintiffs against my client.  It is sufficient, in my submission, if we demonstrate that the action against my client was brought on their behalf within the meaning of subsection (6).

GUMMOW J:   Yes, but what her Honour puts to you is important, is it not, because it goes to this question of entitlement? 

MR JACKMAN:   Yes, it does.  If entitlement means you must be the plaintiff, then the fact that ‑ ‑ ‑

GUMMOW J:   It could have been the plaintiff.  The question is there would have been an extra defendant, namely Perpetual.

MR JACKMAN:   Yes, they could have sued both Perpetual and Minter Ellison or they might have sued Minter Ellison alone and we would then have joined Perpetual on a cross-claim.  One would need to know more facts than appeared in the proceedings ‑ ‑ ‑

GAUDRON J:   No, I do not think one does.

MR JACKMAN:   …..the beneficiaries had a direct right of action against my clients.

GAUDRON J:   I do not think one does need to know more facts.  They could, could they not, right off have sued the trustee companies and your clients as defendants, the trustee companies not, so far as one might properly infer, having then brought action against your clients?

MR JACKMAN:   They certainly could have done so under some causes of action, maybe not all the causes of action.

GAUDRON J:   For breach of trust.

MR JACKMAN:   Well, it would then have to be demonstrated that the situations where the beneficiary could sue rather than the trustee being the plaintiff would be made out.

GAUDRON J:   They could have sued for breach of trust to the trustee companies, enjoining the trustee companies as defendants.

MR JACKMAN:   Yes, indeed, and that is a situation that would typically arise where the trustee companies, here Perpetual, declined to take the action themselves.

GAUDRON J:   And in fact had not taken the action themselves, we may properly infer, by reason of the fact that they sued your clients on a cross‑claim after they themselves were sued.

MR JACKMAN:   Indeed, and so it would have been open in those circumstances for the underlying investors to have maintained the right of suit.

GAUDRON J:   We do not think we need to trouble you further at this stage, Mr Jackman.

MR JACKMAN:   May it please the Court.

GAUDRON J:   Yes, Mr Robb?

MR ROBB:   Your Honours, there are two special leave points.  The first turns on the interpretation of section 23B(1).  The way the applicants put the argument at paragraph 11 of their written submissions was that the sole criterion was that each wrongdoer is “liable in respect of the ‘same damage’ suffered by another person”, and in doing that, the applicants appeared to be looking at the fact that ultimately, beneficially, it was the beneficiaries that suffered the loss.  We submit that, as was recognised by all the courts below, the correct question turns upon the proper construction of section 23B(1) and that raises the question of whether the applicants were persons “liable in respect of any damage suffered by another person”.  That term, as has been recently touched upon, is defined in section 23A.  Before I go to that, may I make three points briefly ‑ ‑ ‑

GAUDRON J:   But one may not even have to go to 23A on one view of 23B(1). 

MR ROBB:   Well, why would that be, with respect?

GAUDRON J:   If the plaintiffs were able by joining the trustee companies, your clients, to sue Minters directly, it may be possible to say that Minters would have been liable in respect of the damage suffered by them and thus, in a legal sense, were liable in respect of the damage suffered by them or some part of it.  You do not have to have all of it.

MR ROBB:   With respect, your Honour, that is not correct.  It is a clear and unquestionable proposition of trust law that unless, completely aliunde the circumstances of the trust, the beneficiaries had their own right of action against somebody dealing with the trustee, the trustee contracts or deals in his own name and it is the trustee’s right of action.  It is true, if I may ‑ ‑ ‑

GAUDRON J:   Yes, but these trustees had not brought action at this stage, had they?

MR ROBB:   They had not brought action until they were sued and they cross-claimed.  Now, the fact that they had ‑ ‑ ‑

GAUDRON J:   It might have been different if the trustees had sued Minters before any action was commenced by the plaintiffs.  I can see that.

MR ROBB:   Let it be assumed that Perpetual Trustee did not sue at all.  In limited circumstances to which I will take your Honours, equity may have permitted as a last resort the plaintiffs to institute proceedings in which Minter Ellison were the defendants to join the trustee and then prosecute the trustee’s own action against Minter Ellison for the purpose of obtaining a judgment against Minter Ellison in favour of the trustee.

GAUDRON J:   But there may also in this case be an argument, may there not, that in the circumstances Minters also owed a direct duty of care to the investors?

MR ROBB:   No.

GAUDRON J:   Why not.

MR ROBB:   Well, whether or not that is theoretically possible, it ‑ ‑ ‑

GAUDRON J:   Would it go to the question of liable for the damage they have suffered?

MR ROBB:   Minter Ellison did not in any part of its case under the Wrongs Act allege any direct liability to the beneficiaries.  No such direct liability was ventilated in the proceedings, so it was not pleaded or proved.  When, with respect, this case comes to the High Court ‑ ‑ ‑

GAUDRON J:   Why would it have to be pleaded or proved?  One is looking only as to whether the judgment should be reduced by reference to contribution under 23B.  I would have thought all you had to do was say, “and the cross-defendant claims contribution” in your pleadings.  Was that pleaded?

MR ROBB:   A claim for contribution was pleaded but there was no case fought below that there was any duty of care owed by Minter Ellison directly to the individual investors.  That was not in contest, there is no finding on it and we respectfully submit that in the High Court a case could not be made that there was such a duty of care that was breached.

GAUDRON J:   Can I find somewhere the exact claim for contribution and any request for particulars that was made in relation to it?

MR ROBB:   Your Honour will not find any of that because there is not reproduced in the application book the original pleadings and we would apprehend the reason they were not reproduced is that they were not seen to be relevant to any issue that could arise in this Court.

GAUDRON J:   It is never wise to come to this Court without the pleadings, let me tell you.  It does not matter what counsel may think, it is never wise, as many have learnt to their regret, to come without the pleadings.

MR ROBB:   With respect, one can see that, your Honour, but they are not here.

GAUDRON J:   They are not in your brief?

MR ROBB:   No, they are not, I am sorry.  They have ceased to be relevant.  So far as was apprehended by the parties ‑ ‑ ‑

GAUDRON J:   Pleadings never cease to be relevant, not even after judgment is entered.

MR ROBB:   May it please the Court, but I cannot help your Honour.

GAUDRON J:   Fundamentally, that must be so because of questions that could arise as to issue estoppel and so forth. 

MR ROBB:   Yes.  If your Honours are against me on the point, well then, so be it, but at the end of the day ‑ ‑ ‑

GUMMOW J:   We are not against you, we are just trying to find out if there is a special leave question.  You may win in the end.

MR ROBB:   Yes.  What we would put, your Honours, is this:  if a case had been run and in any way dealt with that Minter Ellison were directly liable to the investors and the investors had individual rights of action against Minter Ellison, then the condition for the operation of 23B(1) would be satisfied.

GUMMOW J:   Can we look at pages 259 of the application book.  It is the trial judge’s judgment and he refers to 23B, 23A.  He says:

It is not “the same damage” . . . no co-ordinate liability.

Then on 260 he says:

If the case turned on the negligence of Minter Ellison . . . it would be appropriate to consider . . .  contributory negligence.

MR ROBB:   Yes, his Honour noted that if there was a contributory negligence point, he would have divided responsibility 60:40.  He did not make any finding of contribution as such because his Honour held there was no right to contribution.  The Court of Appeal’s position in relation to that matter is stated very ‑ ‑ ‑

GAUDRON J:   If I could just interrupt you, and I am sorry to do this.  It is not that I am necessarily against you, I just need to follow this through.  At page 260 his Honour was there talking, I assume, of breach of duty of care owed to the trustee companies because that would be the only way contributory negligence would come in.

MR ROBB:   Correct, your Honour.  He had moved at that point to the negligence case and decided that he did not need to deal with it.

GUMMOW J:   I think it comes to this in a way, Mr Robb.  We know there had to be a statute like Part IV of the Victorian Act to deal with contract in tort, no contribution relevantly otherwise.

MR ROBB:   Yes.

GUMMOW J:   Not so breach of trust.  What was the purpose of putting in breach of trust in 23A, if not to supplement in some way by expanding the availability of a remedy in equity?  What is the point?  All I want to know is, is that addressed anywhere by the Court of Appeal?  It seemed to me that is a starting question.

MR ROBB:   No, it is not addressed, your Honour.

GUMMOW J:   All right.

MR ROBB:   The Court of Appeal proceeded upon what we submit is the correct basis, being a recognition that when trustees enter into arrangements ‑ ‑ ‑

GUMMOW J:   But is it your submission that 23A or Part IV has no application in relation to contribution where there is a breach of trust that is any different from the equitable principles already established?

MR ROBB:   Yes, relevantly.

GUMMOW J:   Ah.

MR ROBB:   Well, no, so far, it does not – when one looks at the definition in 23A of who is a person liable in respect of damage, it says:

a person is liable in respect of any damage if the person who suffered that damage, or anyone representing the estate of dependents of that person –

Now, we submit that there is no way consistent with trust law that the expression “or anyone representing the estate or dependents of that person” fits a trustee.  It is elementary that the trustee acts in its own name to enforce its own rights.  It so happens that it may hold those rights in equity on trust for others and ‑ ‑ ‑

GUMMOW J:   We all understand that.  The question is, to what degree Part IV expands or distorts, or whatever way you look at it, the already existing law which Mr Jackman admits he cannot get home on.  He needs Part IV.

MR ROBB:   Yes.

GUMMOW J:   So he is saying Part IV does something extra and prima facie you would think it probably did because otherwise they would not have put breach of trust in.  I do not know how that all pans out in the end but there seems to be a question in there.

MR ROBB:   Well, our submission is, your Honours, that the ‑ ‑ ‑

GUMMOW J:   And a question not adverted to below, and if it stands, it will stand as a defective precedent in that sense, defective in that sense.

MR ROBB:   Your Honour, it is fair enough to say, as I recall it, that what your Honour said is true, that the issue that in some way the reference to “breach of trust” in 23A somehow requires the words used to be read differently to what they say is not specifically dealt with by the Court of Appeal.  The reason was that it was not put ‑ ‑ ‑

GUMMOW J:   Yes, there is some tendency by some State courts to construe remedial statutes as not providing any remedial steps because you construe them on the basis of “Oh dear, it could not alter the existing law” and, therefore, it does not.

MR ROBB:   Yes.  Well, may I move to the second point.  That is, your Honours, that the Court of Appeal decided that because on the facts of the case Minter Ellison were the agent and trustee ‑ ‑ ‑

GAUDRON J:   Yes, sorry.

MR ROBB:   Yes.  The second point turns on section 23B and that is where the Court considers what is a just and equitable distribution of responsibility.  That is a factor that Justice Davies focused on in his judgment and, as it happens, in the Burke v LFOT Case 76 ALJR 749 ‑ I have copies of this, I just wanted to refer to a part of it – in Justice McHugh’s decision at 761, Justice McHugh, talking about this very case in the Court of Appeal ‑ ‑ ‑

GUMMOW J:   What is the paragraph, Mr Robb?

MR ROBB:   It is [64], your Honours.

GUMMOW J:   Thank you.

MR ROBB:   Does your Honour have that?

GUMMOW J:   Yes, thank you.

MR ROBB:   At [64] Justice McHugh said:

The solicitors were ordered to pay damages to the beneficiaries, but they sought an order for contribution from the respondents on the ground that they too had been negligent and had breached the terms of their trust by failing to make proper inquiries.

Insofar as Justice McHugh talks about the solicitors were ordered to pay damages to the beneficiaries, that was not the case.  Then, importantly:

The Court of Appeal upheld the decision of the trial judge refusing to make an order for contribution.  Accepting that both parties had breached the terms of their trusts, Stein JA held that they were different trusts and different breaches.  They were simply not “of the same nature and the same extent”.  Davies AJA agreed, pointing out that the respondents had paid trust moneys to the solicitors to be held and dealt with by them as their trustee and agent.

GAUDRON J:   But that is on the basis of equitable contribution, is it not?

MR ROBB:   Yes.

GAUDRON J:   His Honour is not there talking about this Act.

MR ROBB:   Yes, but what his Honour found was that the substance and fact was that Perpetual Trustee retained Minter Ellison as its own agent and its own trustee and duties were owed to Minter Ellison as to Perpetual Trustee.

GAUDRON J:   Yes, but this is a somewhat different case from what was considered in LFOT in that it might well be said that a person in the position of the Perpetual Trustee ought well be aware of the risks of using a solicitor to hold moneys in circumstances where the solicitor is acting for the party on the other side.  I can well comprehend an argument that, apart altogether from liability and breach of trust, there was liability in negligence on the basis – it was not simply a case, as LFOT was, was it, of failing to make proper inquiries?  I know you say afterwards that is all it was, it is the same as LFOT.  The negligence was employing them in the first place, on one view.

MR ROBB:   I am not sure there was a finding of negligence, but there was a finding that Perpetual should have recognised that Minter Ellison may have had a conflict of interest, but there still was a finding ‑ ‑ ‑

GAUDRON J:   Exactly, which makes it a somewhat different case, does it not?

MR ROBB:   Well, your Honour, basically, the finding was that Perpetual relied upon its own agent and trustee.  Its own agent and trustee flagrantly breached the trust duties and caused Perpetual to suffer loss.  Perpetual was in breach of trust in not recognising and not checking and so, ultimately ‑ ‑ ‑

GAUDRON J:   But Perpetual had the documents.

MR ROBB:   Yes.

GAUDRON J:   It knew from those documents that Minters were acting for the other people concerned.  That is all it needed to know.  It knew that Minters would be acting for the other side and would be holding substantial moneys which were trust moneys as far as the trustee companies were concerned.

MR ROBB:   Yes, and as a result, your Honour, they were liable to their own beneficiaries in failing to avoid ‑ ‑ ‑

GAUDRON J:   Yes, what I am just saying is when it comes to contribution as between – I understood you to be putting an argument that the facts were that there is no blame that can be sheeted home to the trustees that is in any way distinguishable from the facts of LFOT.

MR ROBB:   No, I think the point was that Minter Ellison was one trustee that owed a trust obligation to its beneficiary, Perpetual, and having breached its trust, it could not claim contribution from its own beneficiary and could not complain if what damage it caused it had to pay for as between it and its trustee.  Your Honour, I am sorry, I just noticed – our submissions are, your Honours, that the Court of Appeal was correct in the way it interpreted section 23A(1) and the reason it was correct is because the Court of Appeal understood properly the relationship – the nature of a trust and the fact that trustees deal with third parties as if the trustee was the only relevant party, they having equitable duties to their own beneficiaries.

I should just say one more thing.  Very specifically, Justice Stein referred to the points of law that were made and I only refer to one, that is the case of Hayim v Citibank [1987] 1 AC in the Privy Council at 747 and the following page where Lord Templeman, I think it was, very clearly deals with the circumstances in which beneficiaries may be entitled to prosecute the trustees’ actions on behalf of the trust and it is made clear, we respectfully submit, that the beneficiaries are not persons who qua their position as beneficiary are persons who have rights against the likes of Minter Ellison and that, whatever one thinks about the reference to trust in section 23A(1), it cannot rationally change the other meaning of the term.  May it please the Court, they are our submissions.

GUMMOW J:   Now, before you go, Mr Robb, this finding of 60:40 on page 260 we have been looking at, if Mr Jackman were to get special leave and the draft notice at 427 of the application book ‑ you had better look at it, 427 of the application book ‑ if that became the foundation of the appeal here, he seeks orders, you see there, which seem to reflect this 60:40 division.  On all of these adverse contingencies, would there still be a debate as to the 60:40 as being the right proportion?  I am just wondering whether there would be an issue for us to send back somewhere.

MR ROBB:   I cannot properly answer that.  The 60:40 contribution was in the negligence context and it has never been thought of since.

GUMMOW J:   Yes, I am just anxious to work out the real efficacy of this draft notice of appeal, that is all, from your point of view, whether you would be saying, “No, 4 and 5 would not be appropriate orders because there would be something to go back to the Court of Appeal”.

MR ROBB:   Yes, my instructions are that that would be the position of Perpetual Trustee, that the 40:60 was not challenged because it did not arise in relation to the appeal.

GAUDRON J:   You would say, therefore, the matter must go back, if they were ultimately to succeed?

MR ROBB:   Yes.  May I just have liberty to ‑ ‑ ‑

GUMMOW J:   It is just better to know now rather than some time much later.

MR ROBB:   May it please the Court.  Your Honour asked me a question which I did not directly answer because it has not been raised before and I had not thought about it.  One reason for including the reference to “trust” in section 23B(1) is that it would enable apportionment, that is, less than 50:50, whereas in equity, equity is equality and the court is stuck with 50:50 which can sometimes be a problem completely.  There is either equitable contribution, 50:50, or no equitable contribution.  Now, whether that is the reason why the sort of contrary proposition was not put below I do not know.  May it please the Court.

GAUDRON J:   Mr Jackman, I should tell you at this stage, we are minded to grant special leave in the matter, but not on the basis that this Court would be invited, if you were ultimately successful, to embark upon any question of the proportion that should be involved.  Do you resist that?

MR JACKMAN:   No, we will take what we can get and if the consequence would be that the matter is then remitted to the Supreme Court of New South Wales, so be it and ‑ ‑ ‑

GUMMOW J:   You would have to amend your draft notice of appeal.

MR JACKMAN:   Yes, I appreciate that and we would do so to make it is clear that it is only the question of the availability of contribution in principle which is the matter before the High Court.

GAUDRON J:   Yes.  Now, the second thing I should say, it will clearly be necessary to have the relevant pleadings and particulars relating to contribution and perhaps transcript of the argument at first instance if that departed in any relevant respect from the particulars and pleadings or if it elucidated them in any way.  Of course, you will understand that you might well be confined by what appears in those documents when you get to the appeal proper.

MR JACKMAN:   Yes, indeed.  I have some memory of the pleadings and that thought does not trouble me at the moment, but I take your Honour’s point.

GAUDRON J:   Yes, thank you.  That having been said, there will be a grant of special leave.  I will assume the matter being confined in the way I have indicated will not take more than a day.

MR JACKMAN:   That would be so, your Honour.

GAUDRON J:   Yes, thank you.  Very well, special leave is granted.

AT 11.56 AM THE MATTER WAS CONCLUDED