BI (Contracting) Pty Ltd v Northern Adelaide Health Network Inc - [2015] SADC 19

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
BI (CONTRACTING) PTY LTD v NORTHERN ADELAIDE HEALTH NETWORK INC & ORS
[2015] SADC 19
Judgment of His Honour Judge Hannon
26 February 2015
PROCEDURE
Defendants sought order for further particulars of a statement of claim - whether the statement of claim filed by the plaintiff pleaded a cause of action against the defendants in an appropriate form - whether even with compliant pleadings an order should be made that the plaintiff provide further particulars of its case - extent of particularity required in recovery proceedings for indemnity or contribution initiated by a party which has accepted a liability for a deceased's claim under the Dust Diseases Act 2005 - plaintiff granted leave to amend pleadings - application for order for further particulars adjourned.
Dust Diseases Act 2005 s10; District Court Civil Rules 2006 r45; r98; r99, referred to.
Morris v Resi Corporation and Babcock Australia Pty Limited & Anor [2011] SADC 70; BHP Billiton Ltd v Nilson (SA) Pty Ltd [2012] SADC 34; H Stanke & Sons Pty Ltd v Anor v O'Meara [2007] SASC 246, considered.

BI (CONTRACTING) PTY LTD v NORTHERN ADELAIDE HEALTH NETWORK INC & ORS
[2015] SADC 19
Introduction

BI (Contracting) Pty Limited (“the plaintiff”) has issued proceedings against the defendants as the corporate bodies with vested responsibility for any liabilities arising from the ownership and occupation, and the provision of services and facilities, at Modbury Hospital (“the premises”), in and around 1972.
The plaintiff seeks orders that the defendants contribute to, or indemnify it in respect of, a liability incurred by the plaintiff consequent upon proceedings brought against it in the District Court under the Dust Diseases Act 2005 (“the DDA”) by a deceased worker, Mr Sagrillo (“the deceased”). The deceased claimed that as a result of the negligence or breach of statutory duty of the plaintiff he suffered injury, loss and damage, including mesothelioma, due to his exposure to and inhalation of asbestos whilst undertaking work at the premises in or around 1972 during his employment as a plumber with W Curl and Sons. Those proceedings (“the primary proceedings”) resolved by way of a consent judgement for the deceased against the plaintiff in the sum of $175,000 plus costs and disbursements. The current proceedings seek indemnity by or contribution from the defendants on the basis that Modbury Hospital was a tortfeasor, which if sued by the deceased, would have been found liable to him for damages.
The defendants allege that certain paragraphs of the plaintiff’s statement of claim in the proceedings lack adequate particularity. By way of interlocutory application, further particulars are sought in relation to paras 8, 10, 16, 17, 19 and 20 of the statement of claim. In the alternative, in the event that the plaintiff indicated that further particulars could not be provided, an order was sought that the plaintiff’s claim be struck out or dismissed.
At the hearing of the application, the defendants sought only to pursue, at this stage, the order for further particulars. They reserved their position on the strike out application pending a decision on the first aspect.
Paragraph 8 of the statement of claim alleges that “in or around 1972” the deceased undertook work at the premises during his employment as a plumber.
Paragraph 10 of the statement of claim is in the following terms:
10. It was alleged in the Primary Proceedings that during the Worker’s work at the Premises:
10.1 He was required to work in the vicinity of employees and/or contractors of the Plaintiff as those employees and/or contractors prepared and applied insulation spray containing asbestos; and
10.2 He was exposed to and inhaled airborne respirable asbestos dust and fibres generated by the work of the employees and/or contractors of the Plaintiff preparing and applying insulation spray containing asbestos at the Hospital.
Paragraph 11 of the statement of claim recited that it was alleged in the primary proceedings that, as a consequence of the deceased’s exposure and inhalation of asbestos dust and fibres in respirable form, whilst working at the premises, the deceased allegedly suffered injury, loss and damage.
Paragraphs 16 and 17 of the statement of claim set out particulars of negligence and breach of statutory duty alleged by the plaintiff against the defendants, including that the defendants failed to keep the premises where the deceased worked in a clean state, failed to provide effective means of ensuring areas where the deceased worked were free from the risk of the deceased inhaling asbestos dust and fibre, failed to provide any adequate protection or equipment to prevent dust and fibre from entering the air or atmosphere, and failed to extract such material from the atmosphere, and similar allegations.
Paragraphs 19 and 20 allege the defendants are liable to indemnify the plaintiff or contribute in respect of its liability on the ground that “in or around 1972” Modbury Hospital was a tortfeasor, which if sued, would have been found liable to the deceased.
The affidavit filed on behalf of the defendants in support of the application[1] deposed that the vague nature of the references to the time of alleged exposure, and to the works during which and the location where the exposure allegedly occurred, caused prejudice to the extent that the defendants do not know the case brought against it and are unable to obtain adequate instructions in respect of it. Further particularity was sought as to the time of the deceased’s exposure identified by reference to days or weeks, the extent and duration of the alleged exposure, the type of work being undertaken by the plaintiff and its location within the premises, the type of asbestos product used by the plaintiff and the methodology employed in its use, and the nature and location within the premises of the work undertaken by the deceased.
[1] Affidavit of Ms Bowering sworn 31 October 2014.
The plaintiff filed two affidavits.[2] The first exhibited a copy of one of the documents disclosed by the plaintiff in its list of documents filed in these proceedings, being a list of “sprayed asbestos contracts” carried out by the plaintiff over a period of time from 1960 to 1975, with job numbers and a brief description of locations. Few of the job references were accompanied by a date on which the job was done. Three of the jobs referred to work done at Modbury Hospital, each time in conjunction with an AV Jennings corporate entity.[3] None of the Modbury Hospital job references were dated, but the last job description suggested it was carried out shortly before January 1974. I understand this document was exhibited on the basis that it is the only documentary record in the plaintiff’s possession or power which contained any information as to its activities at Modbury Hospital.
[2] Affidavits of Mr Hillary sworn 28 November 2014 and 4 December 2014 respectively.
[3] Jobs 7277, 7371 and 7397.
The second affidavit exhibited a copy affidavit of the deceased affirmed 20 December 2010 and filed in the primary proceedings. The affidavit of the deceased was tendered and received only for the purpose of the interlocutory application. The plaintiff advised that it would seek to tender the affidavit as evidence at trial, with the defendants indicating that it would object to such tender. The affidavit contained a description of the onset of the deceased’s illness from 2009, and details of his work history. Certain paragraphs described in general terms the work in which the deceased was engaged at Modbury Hospital over the period of time alleged and the circumstances of his alleged exposure to asbestos as a result of the activities of employees of the plaintiff.[4]
[4] Paras 21 – 23.
Relevant legislation, rules and principles
The plaintiff issued the proceedings against the defendants on 18 April 2013. The District Court Civil Rules 2006 (“the DCRs”) relating to pleadings have been amended since with effect from 1 October 2014 so as to require the pleading of “material facts and matters relied upon” as opposed to “material facts relied upon”. That amendment has application to proceedings such as the present even though issued before 1 October 2014.[5] The parties did not advert to this amendment and it is not of significance for present purposes except that it may arguably give greater scope for further particularity in relation to the amendments which I consider the plaintiff should make to the statement of claim in order to properly plead the basis of its case as explained below.[6]
[5] Rule 45 of the District Court Civil Rules 2006 (Amendment No 28) Government Gazette 19 September 2014 p 5522 – in particular, each of rules 98, 99 and 102 has been amended in this manner.
[6] At [26] to [34].
Rule 98(2) of the DCRs sets out general rules of pleading, including that a pleading “must be as brief as the nature of the case allows”,[7] “must state only the material facts and matters relied upon and not the evidence or arguments by which the facts are to be proved”,[8] and “must plead such facts and matters as give fair notice of the party’s case at trial”.[9]
[7] DCR 98(2)(a).
[8] Rule 98(2)(b).
[9] Rule 98(2)(d).
Rule 99 addresses the statement of claim. In addition to a requirement that a statement of claim state each cause of action and the basis of it, it also “must contain a short statement of the material facts and matters on which each cause of action is based…”[10]
[10] Rule 99(1)(c).
The defendants’ application is brought under r 102 of the DCRs which provides:
(1)The Court may, on its own initiative or on application, order a party to file further particulars of its case
(2)The further particulars are, however, to be confined to facts and matters that are material to the party's action.
(3) The Court will only make an order for further particulars if satisfied that—
(a) The pleadings do not give fair notice of the party's case; and
(b)The order is necessary to avoid substantial prejudice to the party in whose favour the order is to be made.
(4)Unless the Court directs to the contrary, the further particulars are to be provided by substituting for an existing pleading a new pleading incorporating the further particulars required by the Court.
(5)No pleading is defective for want of particularity unless the missing particulars would be ordered under this rule.
The adequacy of the statement of claim must be considered in the context that the deceased’s claim against the plaintiff was brought under the DDA, which contains particular provisions which bear upon issues relating to procedural compliance. Section 4 specifies that the object of the DDA is to ensure that residents of the State claiming rights under it have access to procedures that are expeditious and unencumbered by unnecessary formalities of an evidentiary or procedural kind. Section 5 gives priority to dust disease actions over less urgent cases so that they may be dealt with as expeditiously as the proper administration of justice allows. Section 8 provides special evidentiary presumptions and rules to accommodate difficulties of proof which arise with respect to claims made under the DDA. Section 10 provides that the Court will determine questions of liability and quantum of liability to a plaintiff before dealing with questions of contribution between defendants and insurers unless any delay in dealing with all questions together is inconsequential.
The approach to questions of alleged lack of particularity in pleadings relating to claims under the DDA was considered by Judge Parsons in Morris v RESI Corporation and Another.[11] She observed, with respect to general litigation, that the nature of the material facts required to be pleaded to give fair notice of the case to be mounted against an opposing party at trial depended upon the cause of action and the circumstances of the particular case. She then wrote:
16. Any issue concerning the sufficiency of the pleadings in a claim for damages for a dust disease must be determined bearing in mind the generally accepted position that such diseases remain latent for many years after the asserted exposure. By the time that the injury first comes to the attention of the plaintiff and proceedings are issued, many years will have passed and the passage of time may influence the precision with which a plaintiff may plead material facts. As a result, the material facts supporting a conclusion that the plaintiff was exposed to asbestos may be based upon the best recollection that the plaintiff has about where and when an alleged exposure occurred, what duties were undertaken at that time and the duration and circumstances of the alleged exposure.
17. Added to that, the very nature of an asbestos related disease makes it impossible to isolate any particular exposure amongst many, as the cause of the condition. Material facts as to exposure will necessarily be global rather than precise.
[11] [2011] SADC 70.
Submissions
Mr Keane for the defendants submitted that the pleadings setting out what purported to be material facts as to the work done by the deceased and the circumstances of his alleged exposure to asbestos were defective as they merely repeated the allegations made by the deceased against the plaintiff in the primary proceedings rather than comprising allegations as between the plaintiff and the defendants. Thus it was contended that the premise upon which the claim for contribution or indemnity was made, namely that the plaintiff had incurred a liability due to the negligence of the defendants in exposing the deceased to asbestos emanating from the plaintiff’s activities at the premises, was not alleged in the statement of claim.
Further, it was contended that even if that defect in the pleadings was cured by amendment, a pleading in a proper form based upon the sparse material facts now relied upon as to the circumstances of alleged exposure to asbestos would not give fair notice of the plaintiff’s case, and would substantially prejudice the defendants. The defendants submitted that the leeway given to injured plaintiffs under the approach taken in Morris should be confined to claims where an injured plaintiff was relying upon a “best recollection”, and should not be extended to corporate entities such as the current plaintiff, given its extensive involvement in the use of asbestos, and the expectation that it would have retained sufficient records of such involvement to allow for disclosure of relevant documentation well beyond those disclosed to date. It was submitted that the plaintiff should produce affidavit evidence to explain its apparent inability to provide more documentary records of its activities at the relevant time.
In the circumstances, it was submitted that the potential for substantial prejudice was clear, as not only were the defendants unable to respond to the general allegations, they were even less able to respond to the specific particulars of negligence and breach of statutory duty in paras 16 and 17 of the statement of claim, and would have to undertake extensive investigations if further material was not provided.
The defendants submitted that it was no answer to suggest that they should have sufficient knowledge of their own arrangements and dealings with any works conducted at the premises in 1972 which would allow for full investigation of the claim, especially given the extensive nature of the operation of Modbury Hospital, and that the defendant entities were not involved in any of the arrangements made at the relevant time.
Mr Hillary for the plaintiff rejected the contention that the statement of claim was defective due it merely reciting certain of the allegations made in the deceased’s statement of claim in the primary proceedings. He submitted that it was not up to the plaintiff to assert as material facts the allegations made by the deceased against it and that it was not possible for the plaintiff to do so. It was contended that the plaintiff’s plea was sufficiently clear, in that the defendants knew the approximate period of time over which the deceased alleged he was at the premises, and knew that during this time the deceased alleged that the plaintiff was spraying asbestos, and that the deceased alleged he was exposed to it. This was contended to be a sufficient plea of material facts to allow the defendants to understand the claim against them.
The plaintiff submitted that the complaint that it should have more information at its disposal by way of historical documentation relating to its activities at the premises in 1972 was not relevant to the issue as to adequacy of pleadings, which should be determined having regard only to what was alleged in the impugned statement of claim.
The plaintiff acknowledged that the information upon which it sought to rely was limited, confined as it was to that available through the deceased’s affidavit, but contended that it should also be given the same leeway as that afforded to individual plaintiffs as in Morris. Such an approach was submitted to be consistent with the fact that s 10 of the DDA contemplated that recovery proceedings such as those now before the Court could proceed separately from primary proceedings, and that the plaintiff had a right to pursue such proceedings under the Law Reform (Contributory Negligence and Apportionment of Liability) Act 2001. The plaintiff contended that if a more onerous obligation was placed upon it in terms of particularity compared to an individual plaintiff, it would inappropriately curtail its rights of recovery. Further, it was submitted that such an outcome would have detrimental consequences for the efficient disposal of proceedings, as defendants to individual plaintiff claims would be more reluctant to agree to sever third party claims from principal proceedings, with adverse implications for the timely hearing of injured plaintiff’s claims in the manner envisaged by the DDA.
Consideration
In addressing the issue as to whether the plaintiff’s pleadings were defective on account of their merely repeating the allegations made by the deceased against the plaintiff in the primary proceedings, both parties referred to the decision of Judge Gilchrist in BHP Billiton Ltd v Nilsen (SA) Pty Ltd.[12] This case involved an application for further particulars or the strike out of a third party statement of claim filed by Nilsen against BHP in circumstances where an injured plaintiff’s claim against Nilsen had settled. BHP complained that the statement of claim was defective in that it made reference to various paragraph numbers in the plaintiff’s statement of claim rather than specifying in pleading form the specific allegations made by Nilsen against BHP.
[12] [2012] SADC 34.
Judge Gilchrist ruled as follows:
I think this complaint is well founded. The plaintiff’s action is at an end. BHP is entitled to assume that Nilsen has given appropriate consideration as to those of the plaintiff’s allegations that it considers can and must be proved for it to succeed in prosecuting a third party action against it.
This will be best achieved by requiring Nilsen to specify what it contends those allegations are, rather than merely citing various paragraph numbers from the plaintiff’s statement of claim.[13]
[13] At [4] and [5].
He later added the following:
BHP complains that Nilsen has not identified any material facts or particulars about the plaintiff’s injury, loss and damage. It has not, but extracting from the plaintiff’s statement of claim those matters that Nilsen contends can and need to be proved in its action against BHP can cure this.[14]
[14] At [36].

The plaintiff contended that its statement of claim did not suffer from the same defect as it did more than merely cite certain paragraph numbers in the deceased’s statement of claim. Rather, it repeated the full content of the deceased’s central allegations against the plaintiff, such as they were, as to the time and circumstances of the alleged exposure.
In my view the plaintiff’s contention misses the point. The plaintiff’s recovery action is an action entirely separate from the primary proceedings, and the plaintiff must plead the material facts and matters upon which it relies to establish its case against the defendants. Mr Hillary in his submissions appeared effectively to concede as much, in contending that:
All that matters in this case is the ability of the plaintiff…to prove firstly that Mr Segrillo was at the Modbury Hospital; secondly that he was there at the period when [the plaintiff] may have been there; and thirdly that he was exposed to respirable asbestos dust of some form.[15]
[15] Tr 16.3 – 7.
And further:
... it is patent that 10.2 concedes at least for the purposes of the recovery action that it must be proved that Mr Segrillo was exposed to contractors of the plaintiff preparing and applying insulation spray containing asbestos at the hospital. That sets out exactly what will be alleged at trial in this matter, if the matter proceeds…[16]
[16] Tr 18.36 – 42; also 21.1 -2; 22.30 -33; 24.9; 25.13 – 17.
The plaintiff’s case will not be made out by proof that the deceased made allegations against it as pleaded in paras 10.1 and 10.2 of the statement of claim. As the above submissions indicate, the case is premised upon proof that the deceased suffered injury loss and damage due to his exposure to and inhalation of asbestos as a result of the plaintiff’s activities at the premises over the time alleged, and that the plaintiff incurred a liability in that regard, and that there should be indemnity or contribution by the defendants on account of their negligence in relation to that exposure. The plaintiff’s statement of claim does not plead the case it intends to make out against the defendants.
I propose to give leave to the plaintiff to amend its pleadings accordingly. In this respect I make the observation that I do not necessarily agree with the plaintiff’s contention that the allegations which might be properly pleaded against the defendants cannot extend beyond the scope of the material facts pleaded, albeit in an inappropriate form, in paras 10.1 and 10.2 of the statement of claim. That is, that the addition of any further content drawn from the deceased’s affidavit would improperly plead matters of evidence rather than material fact. The affidavit of the deceased deposes to the primary nature of the work he did at the hospital, and the location of part of that work, and contains a general reference to the circumstances in which he was exposed to asbestos by employees of the plaintiff, and the nature of their activities at the time.
In my view it is arguable that some of this additional material may be pleaded as material facts and matters rather than impermissible evidence. It has been said that the distinction between material facts and evidence is not always easy to maintain. That may be even more the case in light of the recent amendments to the rules of pleading. Given the limited material available to the plaintiff, this is a case where, in order to provide sufficient particulars to enable the other party to understand the case against it, it may be difficult to plead material facts without pleading, to some extent at least, evidence by which they will be proved: H Stanke & Sons Pty Ltd & Anor v O’Meara.[17] I add that some of the factual matters referred to in the deceased’s affidavit, which add to the material facts currently pleaded, are of a nature which are commonly contained in statements of claim filed in proceedings under the DD Act.
[17] [2007] SASC 246 at [78] and [80].
Should the plaintiff choose to act upon the leave to amend which I propose to grant, it will be up to the defendants to consider whether any amended statement of claim provides sufficient particularity in the circumstances. If they consider deficiencies remain to an extent which might lead the Court to make an order under DCR 102 they will be at liberty to request that their application be called on for further hearing.
To assist in that consideration, it is appropriate that I record some observations in relation to certain of the submissions put to me.
As noted above, the defendants contended that the indulgence in terms of the extent of particularity of pleadings in dust disease matters which might be afforded to an injured plaintiff for the reasons explained in Morris ought not to be extended to pleadings in recovery proceedings such as those issued by the plaintiff where it should have further documentation at its disposal. However, I do not consider the adequacy of the plaintiff’s disclosure is a relevant consideration on an application for further particulars. Sparse as the disclosure to date has been, there is no basis upon which I can approach the matter other than by accepting that the plaintiff has complied with its obligations in this regard and that it has been appropriately advised as to those obligations by its solicitors. If the defendants consider the disclosure to be deficient, it is able to take steps to apply to the Court for orders to ensure that the plaintiff’s obligations are fully complied with. That is a matter separate from the issue before me.
It is often the case that a defendant party to primary proceedings, in subsequent recovery proceedings against other alleged tortfeasors, will seek to rely on a statement or affidavit made by an injured plaintiff who has subsequently deceased in order to establish the basis for recovery. In so doing it seeks to rely upon the best recollection of the deceased which is unlikely to result in much precision in terms of material facts. Whilst it might be expected that such a defendant, particularly one which, as here, was heavily engaged in the asbestos insulation industry, ought to have some records of past activities which allow it to plead its case with greater precision, the fact that the plaintiff does not have such records in this case, and must fall back on the deceased’s best recollection, is no reason for adopting a different approach to a consideration of the adequacy of the pleadings. The fact that the plaintiff is so dependent for the establishment of its case on the deceased’s best recollection means it is more vulnerable to the pleadings being struck out for want of particularity, or to a failure to establish its case, especially if the Court declines to receive the deceased’s statement into evidence. The plaintiff will suffer from a failure to keep adequate records at that stage, if it comes to pass. But it is not a matter which should lead the Court to require a higher standard of particularity of pleadings than would be required of an injured plaintiff.
In this regard I consider that the plaintiff’s submissions that such an outcome would not be consistent with the scheme of the DDA are well made.
My views in this regard are consistent with the approach taken in Nilsen, where Judge Gilchrist considered that the remarks of Judge Parsons in Morris were apposite to the obligations of the plaintiff Nilsen with respect to the level of particularity of its pleading against BHP.[18]
[18] At [25].
Conclusion
I decline to make an order for further and better particulars at this stage.
I will grant the plaintiff leave to amend its statement of claim and upon hearing from the parties will fix a time within which any amendments should be made.
I will adjourn the defendants’ interlocutory application to a date to be fixed on the basis that, if so advised, after consideration of any amended statement of claim, they may withdraw the application, or renew the application for further particulars, or pursue the strike out application.