Andar Transport Pty Ltd v Brambles Ltd - [2003] HCATrans 449

[2003] HCATrans 449

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Melbourne No M214 of 2003

B e t w e e n -
ANDAR TRANSPORT PTY LTD
Appellant
and
BRAMBLES LIMITED
Respondent

GLEESON CJ
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
CALLINAN J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT HOBART ON MONDAY, 3 NOVEMBER 2003, AT 3.27 PM

MR D.F. JACKSON, QC: If the Court pleases, I appear with my learned friend, MR P.H. SOLOMON, for the appellant. (instructed by Wisewoulds)

MR S.G. FINCH, SC: If the Court pleases, I appear with my learned friend, MR D.J. CHRISTIE, for the respondent. (instructed by Allens Arthur Robinson)

GLEESON CJ: Yes, Mr Jackson.

CALLINAN J: Gentlemen, I just should mention I have a small holding in Brambles shares. I do not know whether that makes any difference to anybody.

MR JACKSON: No objection, your Honour.

GLEESON CJ: Yes, Mr Jackson.

MR JACKSON: Thank you, your Honours. Your Honours, as is apparent from the written submissions, the case turns on the resolution of four issues. Two concern the Wrongs Act 1958 (Vic), two relate to a contractual indemnity. The issues which concern the Wrongs Act are, first – and if I could put them in general terms – was the appellant, in terms of section 23B(1) of that Act, liable in respect of the damage to the plaintiff Wail? Secondly, and if so, was the case one where the appellant should be exempted from liability to make contribution? I will come to the detail of those in a moment, your Honours.

The contractual issues concern the indemnity provisions in clauses 8.2.2 and 8.2.3 of a contract which had been in being between the parties. I said it had been in being. It was for a fixed term which had expired before the injury to the plaintiff. The first contractual issue is whether the indemnity clauses relied on by the respondent govern the relationship between the parties at the time of the injury. The second contractual issue is whether, if they did, the relevant provisions on their true construction did apply to the present case.

GLEESON CJ: Now, if we are in your favour on the contractual issues but against you on the Wrongs Act issues, would the matter have to go back to the Full Court?

MR JACKSON: Your Honour, it would depend on the view that the Court took on the two issues. In that regard, if the Court were of the view that it was a case where we should not be exempt, that is, the second issue, if we failed on that, the question which would then yet arise would be whether there should be, I suppose in theory, some further contribution. If the Court was of the view that it could not decide that question or should not decide it, the issue would go back.

Your Honours, may I go first to the provisions…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2003] HCATrans 449
Decision Date

CaseChat Overview and Summary

The High Court of Australia considered an appeal from the Supreme Court of New South Wales in a dispute between Andar Transport Pty Ltd and Brambles Ltd. The core of the disagreement concerned the interpretation and enforceability of a contractual indemnity clause within a transport services agreement. Andar Transport sought to recover costs it incurred in defending a claim brought against it by a third party, arguing that Brambles was contractually obliged to indemnify it for these defence costs.

The central legal issue before the High Court was whether the indemnity clause in the agreement extended to cover the costs incurred by Andar Transport in defending the third-party claim, even though Andar Transport was ultimately found not to be liable to the third party. The court had to determine the scope and meaning of the indemnity provision, particularly in light of the fact that the underlying claim against Andar Transport had been unsuccessful.

The High Court, by majority, held that the indemnity clause did not cover the defence costs in this instance. The majority reasoned that the indemnity was triggered by the occurrence of a loss or liability, and as Andar Transport was not found liable to the third party, no such loss or liability had arisen that would activate the indemnity. The court applied principles of contractual interpretation, emphasizing that indemnity clauses are to be construed according to their plain language and that an indemnity against liability does not ordinarily extend to the costs of defending a claim where no liability is established. The court distinguished this situation from cases where an indemnity might be construed to cover defence costs irrespective of ultimate liability, finding that the wording of the clause did not support such a broad interpretation.

Orders