At v Mervyn Donald Lyons and Betty Ruth Lyons as Administrators of the Estate of the Late Paul John Lyons; BG v Mervyn Donald Lyons and Betty Ruth Lyons as Administrators of the Estate of the Late Paul John Lyons
[2005] ACTSC 104
AT v MERVYN DONALD LYONS and BETTY RUTH LYONS AS ADMINISTRATORS OF THE ESTATE OF THE LATE PAUL JOHN LYONS & Ors
BG v MERVYN DONALD LYONS and BETTY RUTH LYONS AS ADMINISTRATORS OF THE ESTATE OF THE LATE PAUL JOHN LYONS & Ors
[2005] ACTSC 104 (21 October 2005)
PRACTICE AND PROCEDURE – third party claim – whether brought within limitation period – whether cause of action disclosed.
PRACTICE AND PROCEDURE – limitation of actions – Limitation Act 1985, section 21, section 36 – effect of extension pursuant to section 36 upon limitation period fixed by section 21.
Civil Law (Wrongs) Act 2002, s21
Law Reform (Miscellaneous Provisions) Act 1955, Part 4
Limitation Act 1969 (NSW), s14, s52
Limitation Act 1985, s11, s21, s30, s36
Supreme Court Rules 1937, O20
John Pfeiffer Pty Limited v Rogerson (2000) 203 CLR 503.
No. SC 32 of 2001, SC 525 of 2002
Judge: Master Harper
Supreme Court of the ACT
Date: 21 October 2005
IN THE SUPREME COURT OF THE )
) No. SC 32 of 2001
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:AT
Plaintiff
AND:MERVYN DONALD LYONS and BETTY RUTH LYONS AS ADMINISTRATORS OF THE ESTATE OF THE LATE PAUL JOHN LYONS
First Defendant
AND:DARAMALAN COLLEGE LIMITED
Second Defendant
AND:RAY LYONS
Third Party
No. SC 525 of 2002
BETWEEN:BG
Plaintiff
AND:MERVYN DONALD LYONS and BETTY RUTH LYONS AS ADMINISTRATORS OF THE ESTATE OF THE LATE PAUL JOHN LYONS
First Defendant
AND:DARAMALAN COLLEGE LIMITED
Second Defendant
AND:RAY LYONS
Third Party
ORDER
Judge: Master Harper
Date: 21 October 2005
Place: Canberra
THE COURT ORDERS THAT:
The applications be stood over to 11 November 2005 for further submissions in light of these reasons.
These are applications by the third party in each of two actions for summary judgment, or in the alternative, for orders that the third party notices be struck out or dismissed.
The plaintiffs’ actions against the defendants were instituted on 17 January 2001 and 29 August 2002. The third party notices were each filed on 14 March 2003. Defences were delivered by the third party in July 2003 and amended in October 2003. The following month, the plaintiff delivered an amended statement of claim in each action.
Each claim is against the school the plaintiff was attending at the time the cause of action is said to have arisen, and against the estate of a deceased former teacher at the school. The third party is the brother of the deceased teacher, and was himself a teacher at the school at the relevant time.
The plaintiffs were pupils at the school from about 1986 to 1990. In 1998 and 1999, when the plaintiffs were about 15 years old and in Years 9 and 10, it is alleged that the deceased teacher on a number of occasions sexually assaulted each of them at the teacher’s home at Queanbeyan.
The claim against the estate is for assault and breach of duty of care. The claim against the school is for breach of a non-delegable duty of care to the plaintiffs as pupils. The school is also sued as vicariously liable for the conduct of the deceased teacher.
The administrators of the estate of the deceased teacher in their defence have put in issue all of the assertions made in the plaintiffs’ cases, and in addition have pleaded that the estate cannot be liable in law to the plaintiffs and that the actions are statute-barred.
The school has admitted that the deceased was employed at the school as a teacher and that the plaintiffs were pupils at the school at the relevant time, but has otherwise placed the whole of the plaintiffs’ cases in issue. It has also pleaded that the actions are statute-barred.
The third party has been joined by the school but not by the estate. Expressed briefly, the case against the third party is that he knew that his brother was likely to commit sexual abuse against pupils at the school, and failed to inform the school of this. This is said to have amounted to a breach of the terms of his contract of employment.
The actions have come before the Court on numerous occasions. They have been listed before the Registrar for directions on no fewer than 41 occasions. In addition, applications by notice of motion in the actions have been before masters and judges of the court on 13 occasions. Many orders have been made, generally by consent, for the supply of particulars and taking of interlocutory steps. Few have been complied with.
In July 2003, the plaintiffs filed a notice of motion in each action seeking an extension of the limitation period. It appears that on 19 September 2003 orders were made by Ryan J by consent, extending time in each case to the date of the institution of proceedings. The orders have not been taken out.
On 7 November 2003, the third party filed notices of motion seeking orders in almost identical terms to those sought in the applications presently before the Court. The notices of motion were adjourned a number of times, and ultimately came before Marshall J on 18 and 19 October 2004. On the second day, his Honour made a number of consent orders, including orders that the evidence-in-chief of witnesses be on affidavit. Timetables were fixed: the plaintiffs were to file and serve their affidavits by 20 December 2004 and the defendants were to reply by 11 April 2005. Other directions were made about discovery and interrogatories.
Three affidavits were filed in the BG action during April and early May: none were filed in the AT action.
The third party’s applications for summary judgment came before Gray J on 27 May 2005. After some argument, his Honour adjourned the applications generally. His Honour was informed that the Registrar had, on the previous Monday, 23 May, directed the plaintiffs to file further affidavits (presumably any further affidavits upon which they proposed to rely at the hearing) within 28 days, and had adjourned the matters for further directions to 27 June 2005. The bench sheet in each action records an order by his Honour in the following terms:
Order that once affidavits finalised and filed (27 June), second defendant to file amended defence / third party notice within 7 days.
The question of costs was reserved.
When the matter came before the Registrar for further directions on 27 June, no further affidavits had been filed by the plaintiffs. The Registrar directed that the plaintiffs were to file any further affidavits within 7 days, and that the second defendant was to file its amended defences and third party notices “within 21 days thereafter”. No further affidavits have been filed by either plaintiff to date, and the second defendant has not amended its defences or amended the third party notices.
Although the third party’s earlier notices of motion have not been disposed of, on 10 May 2005 the third party filed further notices of motion seeking orders in virtually identical terms to the earlier notices of motion. It was the later notices of motion which proceeded to hearing before me. Counsel appeared for the third party as applicant and for the second defendant as respondent. Although the plaintiffs were not strictly parties to the applications, the plaintiffs’ solicitor attended court for part of the hearing and was able to provide some helpful background information. In the action by BG, the plaintiff’s claim had settled at mediation between the plaintiff and the second defendant (the school). The first defendant, the estate of the deceased teacher, and the third party were not involved in the mediation. Notwithstanding the settlement, the second defendant proposes to proceed with its claims against the third party.
I was informed that the plaintiff AT is seeking a much more substantial sum by way of damages than the settlement amount in the action by BG. The solicitors for the second defendant (the school) wish to attempt a mediated settlement of that claim also, but are not in a position to do so until the plaintiff’s solicitors obtain and serve further expert reports as to his psychological condition. His solicitor informs me that reports from appropriate experts are being obtained.
It is clear that part of the delay in bringing these actions to a conclusion has been due to the understandable desire of the solicitors for the plaintiffs not to incur avoidable costs by way of preparation for hearing if there appear to be good prospects of settlement. This approach has proved to be a sensible one in one case and may yet in the other. At the same time, the delay has put the plaintiffs in breach of directions made by the Court as to the filing and service of additional affidavits. Understandably, those advising the second defendant have not taken any steps in the action to take advantage of the plaintiffs’ failure to comply with the directions: they have no doubt also been motivated by a wish to avoid incurring unnecessary legal costs if there is a reasonable prospect of settlement of the claim by AT.
Equally understandably, the third party does not want to wait any longer. The contention of the third party is that the third party notices in each action do not disclose any cause of action against him and that the third party claims are out of time in any event. If the third party claims are, as he contends, doomed to failure, there is a strong argument that they should be disposed of without further delay.
Although the third party claims are framed in contract, as a breach by the third party of the terms of his contract of employment, there is no allegation of any agreement by the third party to indemnify the school against claims of this kind. The third party claim can be seen only as a claim for contribution by a person not originally a party to the action. Claims for contribution are now governed by section 21 of the Civil Law (Wrongs) Act 2002, which is in the following terms:
21. Right of contribution
(1) A person (the first person) who is liable for damage caused by a wrong can recover contribution from someone else (a contributory) who is also liable for the same damage.
(2) The contribution must be an amount that the court considers just and equitable having regard to the extent of the contributory’s responsibility for the damage.
(3) However, the first person is not entitled to contribution under this section if –
(a) the first person is liable to indemnify the contributory against the contributory’s liability for the damage; or
(b) the court exempts the contributory from liability to make contribution; or
(c) the court has directed that contribution to be recovered from a person for the damage is a complete indemnity for the damage.
This section replaces previous provisions found in Part 4 of the Law Reform (Miscellaneous Provisions) Act (ACT) 1955. The current provisions have the same effect as those they have replaced, although differently worded. Relevantly and significantly, the contributory must be “also liable for the same damage” – that is, liable, if sued, to the plaintiff.
Counsel for the third party submits that the third party notices do not assert any tort on the part of the third party in respect of which he could be found liable to the plaintiffs. Whilst the identification of such a tort might break new ground, I am not persuaded that it is beyond argument that a person in the position of the third party might be found tortiously liable to a person in the position of the plaintiff, assuming that all the elements of the third party notices can be made out. To be more specific, I cannot rule out the possibility that a teacher at a school who knows that his brother, another teacher at the same school, has a predilection for sexually abusing adolescent boys, might not be found to owe a duty of care to pupils at the school. The attributes of being a teacher at the school and being the brother of the abuser might arguably be held to enliven a duty of care which would not exist in their absence. It is conceivable that there might be a finding that if the brother had shared his knowledge with the school, the abuse could have been prevented.
The torts committed by the deceased teacher are alleged to have been committed at Queanbeyan, so that this Court in determining the plaintiff’s claim against the estate would be obliged to apply the law of the state of New South Wales: John Pfeiffer Pty Limited v Rogerson (2000) 203 CLR 503. This includes the law of New South Wales as to limitation periods. Under the Limitation Act 1969 of New South Wales, the relevant limitation period would have been six years (s.14). As both plaintiffs were infants at the time of the alleged assaults, the running of the limitation period would have been suspended until they attained the age of 18 (s.52). The plaintiff AT was born on 31 December 1973 and reached 18 on 31 December 1991. The plaintiff BG was born on 27 November 1973 and reached that age on 27 November 1991. The limitation period in each case would have expired six years later, in November and December 1997. The action by AT was not commenced until 19 January 2001, and that by BG until 21 August 2002, well out of time. The New South Wales limitation provisions are applicable to the claim by the plaintiffs against the second defendant to the extent that that claim is based upon vicarious liability for the assaults committed by the deceased teacher.
Counsel for the third party submits that the non-vicarious claim against the school should be determined according to the law of the Australian Capital Territory, where the school is located. The basis of the submission is that whilst the teacher lived across the border, everything the school did or failed to do it did or failed to do in the Territory. The wrongs committed by the school direct were thus committed in the Territory and claims arising from them should be determined pursuant to the law of the Territory.
In the event there appears to be no difference so far as the limitation period is concerned. The Limitation Act 1985 provides a general limitation period of six years (s.11) which, in the case of a person under a disability, is suspended for the duration of the disability (s.30). Accordingly, both plaintiffs would have been subject to a limitation period of six years running from their eighteenth birthdays, as in New South Wales.
Counsel for the third party submits that only the Territory Act applies to the contribution claim, being a claim arising under a Territory statute, the Civil Law (Wrongs) Act 2002. The relevant section of the Limitation Act is:
21. Contribution between tortfeasors
(1) An action on a cause of action for a contribution under the Civil Law (Wrongs) Act 2002, section 21 (Right of contribution) is not maintainable if brought after the first to end of –
(a) a limitation period of 2 years running from the date when the cause of action for contribution first accrues to the plaintiff or to a person through whom he or she claims; and
(b) a limitation period of 4 years running from the date of the end of the limitation period for the principal cause of action.
(2) For subsection (1)(a), the date when a cause of action for contribution first accrues is –
(a) if the plaintiff in the action for contribution or a person through whom he or she claims is liable in relation to the damage for which contribution is claimed by judgment in a civil action or by arbitral award – the date when the judgment is given or the award is made, whether or not, for a judgment, the judgment is afterwards varied as to quantum of damages; or
(b) if, in a case to which paragraph (a) does not apply, the plaintiff in the action for contribution or a person through whom he or she claims makes an agreement with a person having a cause of action for the damage for which the cause of action for contribution arises, which agreement fixes, as between the parties to the agreement, the amount of the liability in relation to that damage of the plaintiff in the action for contribution or a person through whom he or she claims – the date when the agreement is made.
(3) In subsection (1)(b):
“the limitation period for the principal cause of action” means the limitation period fixed by or under this Act or by or under any other law in force in the ACT (including a law repealed or omitted by this Act) for the cause of action for the liability in relation to which contribution is sought.
Counsel for the third party submits that the applicable provision is paragraph 21(1)(b) so that the limitation period expired, in each case, four years after the expiry of the limitation period for each plaintiff – prior to the plaintiff BG commencing proceedings, and well prior to the filing of the third party notice in either action.
It seems to me that this submission is correct, and that regardless of any extension of time for the plaintiff to bring action against the defendants, the limitation period for a claim for contribution against the third party expired in late 2001. However, I am mindful of the power to extend time in relation to actions for damages for personal injuries conferred by section 36 of the Limitation Act 1985. This section confers a general discretion on a court to extend the limitation period for a plaintiff to bring such an action. Whilst there is no similar discretion conferred on a court to extend time for the bringing of an action for contribution, it does seem to me that it is at least arguable that the limitation period for the principal cause of action referred to in section 21 must be taken to include a limitation period as extended by a court exercising its discretion under section 36. To interpret section 21 otherwise would place a defendant in the invidious position where a plaintiff could bring action against it outside the normal limitation period by reason of a section 36 extension, by which time it would be out of time for claiming contribution from a joint tortfeasor. It seems to me strongly arguable that this cannot have been the intention of the legislature. Counsel did not address specifically on this point, and it would not be appropriate for me to arrive at a conclusion about it without providing an opportunity for counsel to do so.
Counsel for the school submits that the third party claim should not be seen as confined to the Civil Law (Wrongs) Act. He directs attention to Order 20 Rule 1 of the Rules of this court, subrule 1 of which is as follows:
Where in an action a defendant claims as against a person not already a party to the action (the third party) –
(a) that he or she is entitled to contribution or indemnity; or
(b) that he or she is entitled to any relief or remedy relating to or connected with the original subject matter of the action and substantially the same as some relief or remedy claimed by the plaintiff; or
(c) that a question or issue relating to or connected with the original subject matter of the action is substantially the same as some question or issue arising between the plaintiff and the defendant and should properly be determined not only as between the plaintiff and the defendant but as between the plaintiff, the defendant and the third party or between any 2 of them;
the defendant may issue and serve a third-party claim which shall be in accordance with form 1.12 or 1.13 with such variations as the case may require.
Counsel submitted that the amended statement of claim pleads a cause of action in breach of fiduciary duty arising from a special relationship of trust or authority between school and pupil, for which equitable compensation is sought. The solicitors for the second defendant wish to amend the present third party claim so as to claim contribution in respect of that cause of action and those damages.
It does not seem to me that Order 20 is of assistance to the second defendant. The Rules do no more than set out the procedure to be adopted in joining a third party to an action. They do not and cannot of themselves create a cause of action between a defendant and a third party. It is clear that the claim by the second defendant against the third party is a claim for contribution. It is not a claim for any other relief or remedy. It is not suggested that there is some other question or issue relating to or connected with the original subject matter of the action which needs to be determined. I acknowledge that, if the action is to proceed further against the third party, the second defendant will seek an opportunity to amend the third party claim. But I cannot see that any amendment will take the third party claim outside its present status as a claim for contribution.
There has been considerable delay in the prosecution of these actions by the plaintiff against the defendants. Much of the delay may well have been justified: the recent mediated settlement of the claim by BG against the second defendant may be seen as evidence of justification. Nevertheless it is unfortunate that the third party, who denies any liability and is advised that he has a complete defence to the claims against him, has necessarily been caught up in the delay. Having said that, it seems to me premature to consider summarily disposing of the third party proceedings at a time when the pleadings are incomplete and the second defendant intends to amend both its defence and the third party claim. Counsel for the second defendant submits that it cannot and should not be expected to amend its defence until all of the plaintiff’s affidavits have been served, in circumstances where an earlier direction by Marshall J required the service of affidavits rather than the furnishing of particulars. I have some sympathy with this submission, at least whilst there may be affidavits which go to the issue of liability outstanding.
If my provisional view as to the construction of section 21 of the Limitation Act1985 is correct, and if I correctly understand the effect of the orders made by Ryan J on 19 September 2003, then it seems, at least in the case of BG, that the third party notice was issued within the limitation period. It seems that it may have been out of time by a matter of weeks in the AT action: but I shall say no more about that because counsel have not had the opportunity to address on the construction issue.
In any event, if, after amendment, it is apparent that the third party claim goes beyond a claim for contribution under the Civil Law (Wrongs) Act, section 21 may be of limited relevance.
These reasons have raised some issues which were not canvassed during argument by counsel, who should be given the opportunity to make further submissions if so instructed.
Despite the similarity between the two actions, some significant differences have now emerged. The action by BG against the school has settled, and I gained the impression that BG does not intend to pursue his action against the first defendant, the estate of the deceased teacher, any further. In those circumstances there will not be further affidavits from the plaintiff. Those advising the second defendant will need to consider whether the defence still needs to be amended, and what amendments are to be made to the third party notice. There seems no reason why any necessary amendments should not be able to be made within a relatively short period, say 28 days.
In the action by AT, I have come to the tentative view that the third party claim was commenced out of time and that there is no discretion in the court to extend it. I may of course, be persuaded by counsel for the second defendant that this provisional view is wrong. Additionally, amendments to the third party notice may raise other issues.
I propose to publish these reasons and to stand the applications over for a short period to provide counsel with time to digest the reasons and obtain instructions. Subject to any submissions, a period of 21 days would seem adequate.
I certify that the preceding thirty-seven (37) numbered paragraphs are
a true copy of the Reasons for Judgment herein of the Master.Associate:
Date: 21 October 2005
Counsel for the plaintiff: Mr JD Parkinson
Solicitor for the plaintiff: Porters Lawyers
Counsel for the second defendant: Mr RP Clynes
Solicitor for the second defendant: Phillips Fox
Counsel for the third party: Mr WW Arthur
Solicitor for the third party: Bates Collett & Wilson
Date of hearing: 16 September 2005
Date of decision: 21 October 2005
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