Amaca Pty Ltd v State of NSW & Anor

[2003] HCATrans 594

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S389 of 2002

B e t w e e n -

AMACA PTY LTD (FORMERLY KNOWN AS JAMES HARDIE & COY PTY LIMITED)

Appellant

and

THE STATE OF NEW SOUTH WALES

First Respondent

ROLLS ROYCE INDUSTRIAL POWER (PACIFIC) LIMITED (FORMERLY KNOWN AS JOHN THOMPSON (AUSTRALIA) PTY LIMITED)

Second Respondent

Summons

GLEESON CJ

(In Chambers)

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 28 FEBRUARY 2003, AT 10.15 AM

Copyright in the High Court of Australia

MR G.M. WATSON, SC:   May it please the Court, I appear for the appellant.  (instructed by Allens Arthur Robinson)

MR J.F. BURN:   If your Honour pleases, I appear for the State as respondent.  (instructed by Crown Solicitor for New South Wales)

HIS HONOUR:   There is a certificate from the Deputy Registrar that he has been informed that the solicitor for the second respondent will submit to any order of the Court save as to costs.  Mr Watson and Mr Burn, I have for many years held shares in the company called James Hardie International, which I think is probably indirectly a parent company of the appellant, or used to be.

MR WATSON:   Yes, we have no trouble with that, your Honour.

MR BURN:   We are untroubled, your Honour.

HIS HONOUR:   Thank you.  Now, this is a summons for directions but the occasion for the need for directions is that there has been a notice of motion seeking an order extending time for filing a notice of contention, is that right?

MR BURN:   That is correct.

MR WATSON:   Yes.

HIS HONOUR:   All right.  The first direction I will make is that that notice of motion is returnable now.  It is your motion, Mr Burn, go ahead.

MR BURN:   Yes, your Honour.  Your Honour, the State has put on the notice of contention, as your Honour has observed but failed to put it on at the appropriate point in the timetable.

HIS HONOUR:   Now, you move on an affidavit ‑ ‑ ‑

MR BURN:   I do, your Honour.

HIS HONOUR:   ‑ ‑ ‑ of Roy Thomas Williams.

MR BURN:   No, that is Mr Watson’s affidavit.

HIS HONOUR:   I see.  Which is the affidavit ‑ ‑ ‑

MR BURN:   I move on the affidavit of Ms Gillian Fuller dated 4 February.

HIS HONOUR:   Yes, I see that.  Do you have any objection to that, Mr Watson?

MR WATSON:   No, your Honour.

MR BURN:   I read the affidavit, your Honour, and perhaps paraphrase it to say that the notice of contention which is put before your Honour was not lodged at the appropriate time.  This could, in a general way, we would say, be described as an oversight but, perhaps more frankly ‑ ‑ ‑

HIS HONOUR:   Where does it say that?

MR BURN:   No, your Honour, I was moving to a submission ‑ ‑ ‑

HIS HONOUR:   The affidavit just announces the delay.  It does not attempt to explain it.

MR BURN:   No, I was going to go ahead and explain it, your Honour, but I will stay with the affidavit.

HIS HONOUR:   Do you want to supplement the evidence in the affidavit?

MR BURN:   No, your Honour.  No, that is the evidence on which we move, your Honour.

HIS HONOUR:   Then what is the explanation for the delay?  It does not appear from the evidence.

MR BURN:   No, your Honour, it does not.

HIS HONOUR:   Do you want to supplement the evidence?

MR BURN:   I can only do that by my own statement from the Bar, your Honour, which your Honour may not be prepared to receive.  I have no other formal evidence.

HIS HONOUR:   If you inform the Court of what you say is the explanation for the delay, your opponent may or may not accept that.  If your opponent accepts it, then I will accept it.

MR BURN:   Yes, I am grateful, your Honour.  If I may within those terms, I would say that it was a matter of oversight but, more frankly, it should be said that counsel did not bend their minds to the requirement for a contention until late in the timetable.  So it is not a technical oversight of a date requirement; it is the fact that those advising the State regrettably did

not consider what they now feel is the necessity for the arguing of a contention until ‑ ‑ ‑

HIS HONOUR:   There is an ambiguity in paragraph 2 of the affidavit.

MR BURN:   There is, your Honour.

HIS HONOUR:   I must say I had read that as indicating that counsel advised that a notice of contention ought to be filed on 11 October 2002.

MR BURN:   Yes, but, no, that is not correct, your Honour.  I would have to – that cannot be said and the ambiguity would have to be construed against us to the effect that it was following that grant but not on that date that counsel was advised.  That is correct, your Honour.

HIS HONOUR:   So the legal representatives of your client did not turn their minds to the necessity of filing a notice of contention until late January?

MR BURN:   Yes, I have to accept that, your Honour.

HIS HONOUR:   Do you accept that, Mr Watson?

MR WATSON:   I accept that account entirely.

HIS HONOUR:   All right.  I will proceed on that basis.  Now, I am not sure whether it is convenient for Mr Watson or for Mr Burn to tell me what the matter is about and what the relevance of the notice of contention is.

MR WATSON:   Perhaps I should, your Honour.

HIS HONOUR:   All right.

MR BURN:   Yes.

MR WATSON:   A Mr Hay died following contraction of an asbestos‑related disease.  He inhaled the asbestos while working on the construction of the Wallerawang power station.  Amaca was found liable following some proceedings brought against it and it sought contribution to those damages from the State of New South Wales under section 5 of the Law Reform Act.  The basis of seeking that contribution from the State was the assertion that the State was guilty of either a negligent exercise or negligent non‑exercise of statutory powers.

HIS HONOUR:   Now, the basis was a contention that the State was a party who would, if sued, have been liable.

MR WATSON:   Exactly.

HIS HONOUR:   And has that been determined by anybody in these proceedings so far?

MR WATSON:   No.

HIS HONOUR:   Is somebody suggesting it should be determined for the first time by the High Court?

MR WATSON:   It is Mr Burn’s client who is doing that by the notice of contention.  It was obviously necessary for Amaca to prove in our case that the State owed Mr Hay a duty and breached it.  The trial judge went a long way toward finding both of those matters but ultimately declined to find either duty or breach on the basis that he had come to a strong view about apportionment.

HIS HONOUR:   When you say “declined to find either”, do you mean he made no finding one way or the other?

MR WATSON:   Yes.  He made findings leading up to a final finding, so that both sides would contend that they were in front at the time the judgment was delivered, but there was no final declaration of the existence of a duty or of a breach.

HIS HONOUR:   Who was the judge?

MR WATSON:   Judge Curtis of the Dust Diseases Tribunal, a specialist tribunal.

HIS HONOUR:   And what was his reason for leaving the matter in that inconclusive state?

MR WATSON:   His Honour said that he had come to a strong view on apportionment that irrespective of the existence of duty or breach that the claim by James Hardie should fail on the basis that it was the guilty party and that the State was an innocent party and, moreover, it was the taxpayers who would have to supply the money if the State was found liable, which he felt was an appropriate matter to take into account in his discretion.

HIS HONOUR:   Does that mean he dealt with the case on the basis that even if the State was a party who would, if sued, have been liable, he would nevertheless in the exercise of some discretion have declined to order an apportionment?

MR WATSON:   Exactly.

HIS HONOUR:   And was it that point that went to the Court of Appeal?

MR WATSON:   That point went to the Court of Appeal.  We asserted that that was an inappropriate exercise of the discretion.  We added to it, in our appeal, a request that the Court of Appeal determine the existence of a duty and breach.  The Court of Appeal declined to do that, finding that his Honour’s approach to the exercise of discretion was one he was entitled to take.  So, again, there was no finding on either duty or breach.  We then applied for special leave, which was granted, taking only the point regarding the apportionment question.

HIS HONOUR:   On the basis that if you obtained special leave and ultimately were successful in your appeal, the matter would have to be remitted.

MR WATSON:   Exactly.

HIS HONOUR:   And was that the basis on which the application for special leave to appeal was conducted?

MR WATSON:   Yes.

HIS HONOUR:   And what was the attitude of the State of New South Wales to that matter on the application for special leave to appeal?

MR WATSON:   It is recorded at page 12 of Mr Williams’ affidavit – I am so sorry, page 10.

HIS HONOUR:   Yes.

MR WATSON:   At line 353 ‑ ‑ ‑

HIS HONOUR:   This is actually the transcript of the special leave application.

MR WATSON:   Yes.  Mr Ireland, who then appeared on behalf of the State, raised what he saw as being a problem.  I will allow your Honour to read it.

HIS HONOUR:   Where do I find the Court of Appeal dealing with this matter?

MR WATSON:   I will have that turned up for your Honour in just a moment.  There is another reference in the special leave application to which I would wish to take your Honour at page 12 where at line 422 Justice Gaudron tried to clarify the length of the matter and that page records a concern expressed by Mr Douglas, who was then appearing for Amaca Pty Limited.

HIS HONOUR:   That seems to record, subject to what Mr Burn wants to say, that on the special leave application Mr Douglas, who was appearing for your client, and Justices Gaudron and Kirby were expressing the assumption that on any appeal this Court would not get into the question sought to be raised by the notice of contention.

MR WATSON:   Yes.

HIS HONOUR:   What did Mr Ireland have to say about that?

MR WATSON:   There was nothing said further about that issue on that day.  So there was just the brief comments at page 10 and those comments by Mr Douglas at page 12, supplemented by observations by their Honours and that was the position we understood until we received the notice of contention.  May I tell your Honour that at the time the notice of contention was served upon us the appeal books had already been settled – I am not sure that they had been printed but they had certainly been settled – and they comprised materials which are designed to go to the apportionment issue and they are not extensive.  If the liability issue is raised, the appeal books will need to be revisited and they would be far more extensive.  That is a matter in due course, if your Honour comes to it, we will seek directions upon.

HIS HONOUR:   That is a matter as to which I notice there was some suggestion made to the Registry that the High Court might sit for a day in April and look at some of the issues in the case and then stand the case over for a few months and perhaps, or perhaps not, give a decision on the preliminary issues in the meantime and then deal with the rest of the case, if necessary.

MR WATSON:   An ugly option but only as ugly as the alternative, which I will come to in due course, if your Honour pleases, when I suggest what directions need to be made if the notice of contention is permitted to be put before the Court.

HIS HONOUR:   You may assume that the possibility of that option being acceptable is extremely remote.

MR WATSON:   I will do that.

HIS HONOUR:   The idea that we are going to look at this case twice is not likely to be attractive.

MR WATSON:   The portion of the Court of Appeal judgment was much like the trial judge’s findings – quite brief.  It is in the second volume of the appeal books at page 280.  Really, probably the whole of that page from point 10 down to the foot of the page.

HIS HONOUR:   I am just going to need to go back to paragraphs 13 and 14.  It appears from paragraphs 13 and 14 that what the trial judge did was refer to what he understood to be two different approaches to the question of the State’s liability emerging from judgments in the case of Pyrenees Shire Council v Day and then he said on one of those approaches he would find the State liable and on the other approach he would find the State not liable.

MR WATSON:   Yes, that is close to it, although his Honour did not go so far as to express that finally.  He couched it in terms of reserving the issue.

HIS HONOUR:   Did he make all necessary findings of fact on any possible approach?

MR WATSON:   No.  He did discuss factors which went to breach and factors which indicated against breach.

HIS HONOUR:   Incidentally, what is the amount of money involved in this third party claim?

MR WATSON:   In this instant claim, probably a sum in the order of $100,000, but in the context of at least several dozens of similar cases arising out of power stations all over New South Wales, a great deal of money.  The case may also have broader implications beyond simply power station cases to other areas where the State was involved in a similar capacity.

HIS HONOUR:   Do I gather from what you say that on your contention the necessary findings of primary fact that would have to be made to decide finally the question of liability of the State were not made by the primary judge and were not even considered by the Court of Appeal?

MR WATSON:   Yes.  There is, I think, a contention to the opposite made by the State, who in the Court of Appeal suggested that sufficient findings were present to say that there was no duty, nor was there a breach.

HIS HONOUR:   We do not have the benefit of any reasoning of the Court of Appeal on that subject.

MR WATSON:   No, because their Honours felt that if the trial judge’s decision was wrong, it was only a discretionary exercise with which they could not interfere in any event.  Your Honour, that is really what I had to say to your Honour by way of explaining the background, but may I just explain to your Honour something about the difficulties posed by the existence of this notice of contention.  Your Honour will appreciate that if on 3 April we come to Canberra we will need to amend the appeal books – that can be done but it is expensive and it will take time – but we would also need something else which may not be available, which is more Court time.

HIS HONOUR:   It is not available in April and you can assume that we are not going to deal with this case twice.

MR WATSON:   I am taking that assumption, your Honour, now.  It would also require some rethinking of the availability of our ability to make submissions on the issue.  The issues of the existence of duty and breach are quite complex and part of the proposal that we would put to your Honour would accommodate, as it were, each party being given a full right of submissions on that issue as well as the apportionment issue.  We have prepared between us different directions which would apply, depending on which option the Court would take, assuming the notice of contention is to be put before the Court on 3 April.

The first – and I hand this to your Honour only in hope now because it does – well, the State is no longer interested in that proposition.  It would be directions which relate to the conduct of the argument – or preparation of the appeal books and conduct of the argument in writing on the notice of contention.

HIS HONOUR:   Look, subject to anything that you and Mr Burn want to say about it, my initial reaction to this at the moment would be to say that if I extend time or, to use the language of the Rules, enlarge time for filing the notice of contention, then the matter would appear to be one that would be likely to take more than a day and so it would just be taken out of the list on 3 April and fixed at a future date.  If, on the other hand, I decided not to enlarge the time for the notice of contention, the matter would just proceed on 3 April.

MR WATSON:   There is nothing I want to say about those options, but would your Honour just allow me to take some brief instructions?  May I take my seat, having ‑ ‑ ‑

HIS HONOUR:   Yes.  As I understand it, these fairly elaborate directions that you have prepared are really an attempt to accommodate the situation

that would arise if the time for filing the notice of contention were enlarged but the existing hearing date remained.

MR WATSON:   Exactly.  So I shall take my seat at this stage and just allow Mr Burn to ‑ ‑ ‑

HIS HONOUR:   Is there anything else you want to say on whether or not the time for filing the notice of contention should be enlarged?

MR WATSON:   No.  We will not adopt a position on that.

HIS HONOUR:   You do not claim to have suffered any prejudice?

MR WATSON:   No.

HIS HONOUR:   Yes, Mr Burn.

MR BURN:   For our part, your Honour, we would submit that if your Honour were to enlarge the time for lodging the contention, which we would encourage your Honour to do, then it would be more appropriate, we would say, that the hearing be vacated.

HIS HONOUR:   The fact that time for filing the notice of contention was enlarged, for example, until today, with the consequent vacating of the hearing date of 3 April – and I might say there is another case that will be put in instead of this case on 3 April – does not necessarily mean that when you came to present argument on your notice of contention the Court would deal with that argument.

MR BURN:   No, I do understand that, your Honour.

HIS HONOUR:   I would understand that your opponents will take the attitude that the findings of fact necessary to make a decision on the matter that you seek to raise by your notice of contention do not exist and that because of that and because there is no reasoning of the Court of Appeal on the issue this Court should not deal with it.  So that the argument you seek to present on the notice of contention might, in the events that happened, come to very little.

MR BURN:   Yes, I appreciate that, your Honour.  If I were dealing with it now, I would make a distinction from what my friend has said, but there is not any advantage at today’s hearing in my embarking on that and I accept entirely that we may not be given the opportunity to argue the contention when we come to the hearing.  That cannot be decided until the hearing, and I understand that, your Honour.

HIS HONOUR:   All right.  I think that in view of the fact that your opponent does not claim to have suffered any prejudice as a result of the delay in filing the notice of contention, I should enlarge the time.

MR BURN:   I am grateful to your Honour.

HIS HONOUR:   The first respondent in this appeal seeks an order under Order 60 rule 4 enlarging the time for filing a notice of contention.  The notice of contention was filed out of the time prescribed by Order 70 rule 6.  The explanation that has been given is that the legal representatives of the first respondent did not direct their minds to the need to file a notice of contention within the time limited by the Rules.

The appellant does not claim to have suffered any prejudice in consequence of the delay in filing the notice of contention and it seems to me that in those circumstances I should make an order under Order 60 rule 4 enlarging the time for filing the notice of contention until 4.00 pm this afternoon.

I should make it clear, however, that this is without prejudice to the right of the appellant to argue, as it has foreshadowed, that it would be inappropriate for this Court, on the hearing of the appeal, to deal with the issues sought to be raised by the notice of contention.  It will be the submission of the appellant that the primary judge did not make the findings of fact necessary to enable those issues to be determined and that the Court of Appeal did not deal with those issues.  One possible outcome, therefore, will be that if the appeal otherwise succeeds those issues will be remitted for further consideration, either by the Court of Appeal or by the trial judge.

This matter had been fixed for hearing on 3 April on the assumption that the only point to be argued was that referred to on page 10 of the transcript of the special leave application and on that basis was allocated one day.  It seems likely that even if the Court does not finally decide that it is appropriate to make a decision on the issues sought to be raised by the notice of contention, the arguments about the notice of contention that will be raised by the parties will take the case well into a second day.  In those circumstances, the matter will be taken out of the list for 3 April and will be listed for hearing at a later sittings of the Court.

Mr Burn, these proceedings were made necessary by your client’s failure to file a notice of contention in time.  Have you anything to say about costs?

MR BURN:   No, I can put nothing, your Honour.

HIS HONOUR:   The first respondent must pay the costs of the appellant of today’s proceedings and I certify for the attendance of counsel in chambers.

Is there anything more that the parties want me to do?

MR WATSON:   No, your Honour.

MR BURN:   No, your Honour.

HIS HONOUR:   I will adjourn.

AT 10.43 AM THE MATTER WAS CONCLUDED