Bradford Insulation Industries Pty Ltd v Babcock Australia Pty Ltd
[2011] NSWCA 117
•16 May 2011
Court of Appeal
Supreme Court
New South Wales
Medium Neutral Citation: Bradford Insulation Industries Pty Ltd & Anor v Babcock Australia Pty Ltd & Ors [2011] NSWCA 117 Hearing dates: 28 April 2011 Decision date: 16 May 2011 Before: Hodgson JA at 1, Macfarlan JA at 6, Sackville AJA at 7. Decision: 1. Leave to appeal granted.
2. Appeal dismissed.
3. The Appellants to pay the First Respondent's costs of the appeal.
[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]
Catchwords: DUST DISEASES TRIBUNAL - procedure - new claim by defendant seeking contribution from third parties - claims resolution process ("CRP") - apportionment determination by a Contributions Assessor - whether CRP applies to contribution claims made in separate proceedings to original claim - whether ss 32H(1)(a), 32H(1)(b) of Dust Diseases Tribunal Act authorises regulations applying CRP in separate contribution proceedings Legislation Cited: Civil Procedure Act 2005 (NSW)
Dust Diseases Tribunal Regulation 2001
Dust Diseases Tribunal Act 1989 (NSW)
Dust Diseases Tribunal Amendment (Claims Resolution) Act 2005 (NSW)
Interpretation Act 1987 (NSW)
Law Reform (Miscellaneous Provisions) Act 1946 (NSW)
Limitation Act 1969 (NSW)
Dust Diseases Tribunal Regulation 2007
Uniform Civil Procedure Rules 2005Cases Cited: Power Technologies Pty Ltd v Energy Australia [2010] NSWCA 107
QBE Insurance (Australia) Ltd v Wallaby Grip Ltd [2007] NSWCA 43; 4 DDCR 331
Seltsam v Energy Australia [1999] NSWCA 89; 17 NSWCCR 720Category: Principal judgment Parties: Bradford Insulation Industries Pty Limited (First Appellant)
CSR Limited (Second Appellant)
Babcock Australia Pty Limited (First Respondent)
Amaca Pty Limited (ACN 000 035 512) (Under NSW Administered Winding Up) (Second Respondent)
Wallaby Grip Limited (Third Respondent)
Wallaby Grip (BAE) Pty Limited (in liquidation) (Fourth Respondent)Representation: Counsel:
Mr T G R Parker SC (First and Second Appellants)
Mr A J Sullivan QC with Mr D Miller (First Respondent)
Solicitors:
Colin Biggers & Paisley (First and Second Appellants)
Moray & Agnew (First Respondent)
DLA Phillips Fox (Second Respondent submitting appearance)
Middletons (Third and Fourth Respondents submitting appearance)
File Number(s): CA 296526/10 Decision under appeal
- Citation:
- Babcock Australia Pty Ltd v Bradford Insulation Industries Pty Ltd [2010] NSWDDT 12
- Date of Decision:
- 2010-08-10 00:00:00
- Before:
- Curtis J
- File Number(s):
- DDT 168/09
DDT 168/09/CC1
Judgment
HODGSON JA: I agree with the orders proposed by Sackville AJA, and with his reasons.
One matter adverted to in argument was that, if Div 6 of Pt 4 of the Dust Diseases Tribunal Regulation 2007 applied to separate proceedings for contribution, not brought as cross-claims in the original claim for damages, there was no time limit for the bringing of those separate proceedings other than the limit of two years provided by s 26 of the Limitation Act 1969, running from the time when judgment was obtained in the original proceedings.
If Div 6 does apply to separate proceedings for contribution, then cl 55 of the Regulation means that they are subject to the claims resolution process, and are liable to be removed from that process only in the limited cases specified in cl 22. It might be thought that the Regulation could not reasonably have intended that the rough and ready procedure of the claims resolution process should apply to proceedings brought for contribution up to two years from the time when judgment was obtained in the damages proceedings.
There is some force in that consideration, but in my opinion it is far from sufficient to displace the considerations discussed by Sackville AJA.
One matter that removes force from that consideration is that a determination concerning contribution under the claims resolution process is binding on defendants "for the purposes of the settlement, or determination by the Tribunal, of the plaintiff's claim and payment of the plaintiff's damages": cl 52. In order that a person seeking contribution in separate proceedings be able to rely on the determination as binding (and thus to support an order for payment under s 90 of the Civil Procedure Act 2005), it would appear that the person has to show that the determination had such a connection with the settlement or determination of the plaintiff's claim that it can be found to be "for the purposes of" that settlement or determination; and it may be very difficult for this to be shown unless the new proceedings are commenced very promptly.
MACFARLAN JA: I agree with Sackville AJA.
SACKVILLE AJA: The issue in this case is whether the " rough and ready " claims resolution process (" CRP "), which applies to claims in respect of asbestos-related conditions, is available in separate contribution proceedings instituted in the Dust Diseases Tribunal (" Tribunal ") by a defendant to the original claim for damages brought by a plaintiff exposed to asbestos. The determination of this issue depends on the proper construction of Div 6 of Part 4 of the Dust Diseases Tribunal Regulation 2007 (" DDT Regulation 2007").
The general operation of the CRP established by Div 5 of Part 4 of the Dust Diseases Tribunal Regulation 2001 (" DDT Regulation 2001") (the predecessor to Div 5 of Part 4 of the DDT Regulation 2007) was explained by Handley AJA (with whom Hodgson and Campbell JJA agreed) in QBE Insurance (Australia) Ltd v Wallaby Grip Ltd [2007] NSWCA 43; 4 DDCR 331, at 335 [15]:
"Division 5 establishes a procedure for the summary but provisional determination of contribution claims in order to facilitate settlement of the plaintiff's claim and the satisfaction of any judgment he may obtain by judicial decision or settlement. A defendant or cross-defendant who is dissatisfied with the summary determination can pursue its strict rights and seek a more favourable determination at a trial but will be subject to significant costs sanctions if a substantially better result is not achieved. Meanwhile the summary determination is immediately enforceable. A clear purpose of the scheme is to prevent the final determination of the plaintiff's claim being delayed by contribution disputes."
Handley AJA used the expression " rough and ready " in Wallaby Grip to describe the CRP : at 339 [42].
The first respondent (" Babcock ") satisfied a consent judgment obtained against it by the plaintiff, whose exposure to asbestos caused him to contract mesothelioma. Babcock subsequently instituted separate proceedings in the Tribunal claiming contribution from a number of companies supplying or dealing in asbestos, including the applicants for leave (" Bradford " and " CSR " respectively). Babcock says it is entitled to invoke the CRP in relation to its contribution claims notwithstanding that they have been made in separate proceedings and not by way of cross-claim in the original proceedings commenced by the plaintiff. Bradford and CSR (together " the appellants ") say that the CRP is available only in relation to a cross-claim filed in the original proceedings.
The Tribunal (Judge Curtis) ruled in favour of Babcock: Babcock Australia Pty Ltd v Bradford Insulation Industries Pty Ltd [2010] NSWDDT 12. The appellants seek leave to appeal from the Tribunal's decision.
The Court heard argument on both the application for leave to appeal and on the appeal. As the issue for determination is of practical significance, the appellants should be granted leave to appeal. However, for the reasons which follow, the appeal should be dismissed.
BACKGROUND
On 8 January 2009, Mr P R Fitzpatrick instituted proceedings in the Tribunal against Babcock. Mr Fitzpatrick alleged that while employed by Babcock he had been exposed to asbestos and, in consequence, contracted mesothelioma. Babcock admitted liability. On 9 May 2009 the Tribunal entered judgment for Mr Kirkpatrick against Babcock for $1,771,640, plus costs. Babcock duly satisfied this judgment.
On 30 June 2009, Babcock commenced proceedings in the Tribunal by a statement of claim seeking contributions from each of four defendants pursuant to s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) (" 1946 Act ") (" Contribution Proceedings "). One of the four defendants to the Contribution Proceedings, Amaca Pty Ltd (" Amaca ") subsequently filed a cross-claim against CSR. I refer collectively to the four defendants and CSR as " the Defendants " (Amaca and the remaining two defendants to the Contribution Proceedings are respondents to the application for leave to appeal and have filed submitting appearances).
By letter dated 26 October 2009, Babcock requested the Registrar of the Tribunal to exercise the power conferred by cl 49 of the DDT Regulation 2007 to appoint a Contributions Assessor. The purpose of the request was to enable the Contribution Assessor to determine apportionment among Babcock and the Defendants in accordance with the CRP established by Part 4 of the DDT Regulations 2007. The Registrar duly appointed a Contributions Assessor.
On 13 November 2009, the Contributions Assessor determined the contributions of Babcock and the Defendants as follows:
"Party
per cent
Babcock
48.00
Amaca
13.00
WGL
1.69
BAE
11.31
Bradford
13.00
CSR
13.00
TOTAL
100.00
Three of the Defendants were content with this apportionment and have paid their assessed contributions to Babcock. Bradford and CSR, however, did not accept the apportionment. They want Babcock's claim against Bradford and Amaca's cross-claim against CSR to go to trial without them being required to make the contributions determined by the Contributions Assessor.
On 5 March 2010, Babcock filed a motion in the Contribution Proceedings seeking an order pursuant to s 90 of the Civil Procedure Act 2005 (NSW) (" CP Act ") that Bradford and CSR pay to Babcock their contributions, as assessed by the Contributions Assessor. In each case, the amount sought by Babcock was $247,863.20. Bradford and CSR opposed the orders sought by Babcock.
In his judgment, Judge Curtis ruled that Div 6 of Part 4 of the DDT Regulation 2007 applied to Babcock's claim for contribution. His Honour accepted that s 90 of the CP Act, read with s 11(1A) of the Dust Diseases Tribunal Act 1989 (NSW) (" DDT Act" ), authorises the Tribunal to make an order for payment of money in consequence of an apportionment assessment made by a Contributions Assessor. Accordingly, his Honour made the orders sought by Babcock.
STATUTORY FRAMEWORK
DDT Act
The DDT Act establishes the Tribunal as a court of record: s 4. The Tribunal has exclusive jurisdiction to hear and determine proceedings referred to in s 11 of the DDT Act : s 10(1).
Section 11 of the DDT Act provides as follows:
"(1) If:
(a) a person is suffering, or has suffered, from a dust-related condition or a person who has died was, immediately before death, suffering from a dust-related condition, and
(b) it is alleged that the dust-related condition was attributable or partly attributable to a breach of a duty owed to the person by another person, and
(c) the person who is or was suffering from the dust-related condition or a person claiming through that person would, but for this Act, have been entitled to bring an action for the recovery of damages in respect of that dust-related condition or death,
proceedings for damages in respect of that dust-related condition or death may be brought before the Tribunal and may not be brought or entertained before any other court or tribunal.
(1A) Proceedings by any tort-feasor liable in respect of damages referred to in subsection (1) to recover contribution from any other tort-feasor liable in respect of that damage may be brought before the Tribunal.
Note . This subsection does not prevent those proceedings being brought in another court.
...
(3) If the cause of action giving rise to proceedings to be brought under subsection (1) or (1A) also gives rise to a claim in respect of some other matter, the claim may be included in those proceedings even though it does not relate to a dust-related condition from which a person is suffering or has suffered.
(4) Any matter that is ancillary or related to a matter that is the subject of proceedings to be brought under subsection (1) or (1A) may also be included in those proceedings.
...".
The Note to s 11(1A) does not form part of the DDT Act : s 3(3). It is not necessary for the purposes of this appeal to reconcile the Note with the terms of s 10(1).
Section 14(1) of the DDT Act provides as follows:
"If a judgment or order of the Tribunal is for payment of an amount of money (including a sum awarded as costs) the judgment or order shall, on the filing of the prescribed documents in the registry of the Common Law Davison of the Supreme Court, be taken to be a judgment of that Court for the payment of that amount of money in accordance with the judgment or order of the Tribunal;".
Section 14(5) of the DDT Act states that Part 8 of the CP Act (which deals with enforcement of judgments and orders) does not authorise the Tribunal to exercise any function of a court under that Part. However, s 10(5) of the DDT Act provides that, subject to s 14 and one other presently irrelevant exception, a decision of the Tribunal has the same effect as and may be enforced in the same way as a decision of the Supreme Court.
Part 3B of the DDT Act (ss 32G-32I), like s 11(1A), was introduced into the DDT Act by the Dust Diseases Tribunal Amendment (Claims Resolution) Act 2005 (NSW) (" DDT Amendment Act 2005"), s 3, sch 1 [14]. Part 3B is headed " Regulations - claims management and practice and procedure ".
Section 32H relevantly provides as follows:
"(1) The Governor may make regulations for or with respect to the following:
(a) the establishment of a claims resolution process for claims, with procedures for identifying the issues in dispute between the parties to a claim and the settlement of claims by alternative dispute resolution processes.
(b) procedures and presumptions for the apportionment of liability between defendants and cross-defendants in connection with a claim.
...
(2) Without limitation, this section authorises the making of regulations for or with respect to the following:
...
(c) procedures and presumptions for the apportionment of liability between defendants and cross-defendants (including by providing for the making of determinations as to apportionment and for the determination by the Minister of standard presumptions as to apportionment),
...
(3) The regulations under this section prevail to the extent of any inconsistency between a provision of those regulations and a provision of the Civil Procedure Act 2005, rules of court or any direction or order of the Tribunal made under a provision of this or any other Act or rules of court."
Section 32G of the DDT Act contains important definitions for the purposes of Part 3B:
"claim means a claim in proceedings.
proceedings means proceedings in the Tribunal brought or to be brought under section 11 ...".
DDT Regulation 2007
Status of the Regulation
The CRP was introduced into the DDT Regulation 2001 by the DDT Amendment Act 2005, which inserted Part 4 into the DDT Regulation 2001 . Thus the CRP, although governed by Part 4 of the DDT Regulation 2001 (as amended), was introduced by statute and not by subordinate legislation: see Power Technologies Pty Ltd v Energy Australia [2010] NSWCA 107, at [17], per Sackville AJA (with whom Allsop P and Beazley JA agreed). Part 4 of the DDT Regulation 2001 did not include Div 6, now incorporated into Part 4 of the DDT Regulation 2007.
The DDT Regulation 2001 was repealed by the DDT Regulation 2007: cl 97(1). The Explanatory Note to the DDT Regulation 2007 states that the Regulation is made under the DDT Act " including section 32H ".
Part 4 of the DDT Regulation 2007, which applies to claims commenced after 1 July 2005 (cl 16(1)), repeats verbatim many of the provisions in Part 4 of the DDT Regulation 2001, although it incorporates additional provisions, including the new Div 6. The outline of Part 4 below draws in part on the survey in Power Technologies of equivalent provisions in the DDT Regulation 2001.
Div 1 of Part 4
Clause 13 of the DDT Regulation 2007 (which was not in the DDT Regulation 2001) states the objects of the CRP as follows:
"(a) to foster the early provision of information and particulars concerning claims in respect of asbestos-related conditions,
(b) to encourage early settlement of those claims,
(c) to reduce legal and administrative costs in connection with those claims."
Clause 14 (which is identical to cl 12 of the DDT Regulation 2001) is as follows:
" Part applies only to asbestos-related claims
This Part applies to a claim in respect of an asbestos-related condition that is made by the person who is or was suffering from the asbestos-related condition (or by a person claiming through that person, including a compensation to relatives claim) or that is a cross-claim by a defendant on such a claim".
Div 2 of Part 4
A claim to which Part 4 applies is subject to the CRP once the claim is filed: cl 18(1). A claim remains subject to the CRP until settled by mediation or otherwise or until mediation is concluded: cl 18(2).
While a claim is subject to the CRP, the parties to the claim must comply with the provisions of Part 4 and, subject to limited exceptions, proceedings in the Tribunal to determine the claims are deferred: cl 19(1). However, cl 19(2) provides that cl 19(1) does not affect the application of the practices and procedures of the Tribunal with respect to (among other things):
"(e) the making of cross-claims, except to the extent of any inconsistency with clause 25".
A claim can be removed from the CRP in certain cases, for example where a claim is urgent or because a party has failed to comply with the CRP and the failure has caused substantial prejudice to another party: cl 22(1).
Div 3 of Part 4
Clause 25(1) provides that an " original defendant " in proceedings must make a cross-claim as soon as practicable after being served with the plaintiff's claims. (" Original defendant " is defined to mean a defendant on the claim before the joinder of any other person as a defendant or cross-defendant: cl 12(1).) In any event, all claims by cross-defendants must be filed and served within strict time limits, subject to the possibility of short extensions of time: cl 25(2), (3). A cross-claim that is not served and filed as required by cl 25 cannot be made in the proceedings, but this does not affect the right of a defendant to pursue the claim in separate proceedings commenced by the defendant: cl 25(9).
Div 5 of Part 4
Clause 47 provides as follows:
" Application to cross-defendants
(1) A reference in this Division to a defendant includes a reference to a cross-defendant.
(2) The settlement or determination of a plaintiff's claim ( the original claim ) does not affect the continued operation of this Division in relation to a cross-claim on that original claim and the apportionment of liability among cross-defendants on the cross-claim. For that purpose (and despite clause 18) the cross-claim remains subject to the claims resolution process."
Clause 47(2) had no equivalent in the DDT Regulation 2001 (as amended).
Clause 48(1) of the DDT Regulation 2007 requires defendants to a claim who are alleged to be liable to contribute to any damages recovered by the plaintiff, to agree among themselves as to the contribution each is liable to make to those damages. Agreement is required within a very short time frame (35 business days after service of the plaintiff's statement of particulars for malignant claims): cl 48(2). A reference in Div 5 of Part 4 to a " defendant " includes a reference to a cross-defendant: cl 47(1).
If the defendants do not reach agreement within the time frame, the Registrar is to refer the matter to a Contributions Assessor for determination within strict time limits: cl 49(1), (6). The Contributions Assessor is:
"to determine the contribution that each defendant is liable to make and is to make that determination on the assumption that the defendants are liable and solely on the basis of:
(a) the plaintiff's statement of particulars and the defendants' replies on the claim, and
(b) standard presumptions as to apportionment determined by the Minister ...
(cl 49(4))."
A determination of a Contributions Assessor cannot be challenged, reviewed, quashed or called into question before any court or administrative review body. However, this does not prevent the subsequent taking, or determination by the Tribunal, of a dispute as to apportionment: cl 49(8).
Clause 52 of the DDT Regulation 2007 deals with the effect of an agreement or determination as to apportionment:
"(1) An agreement or determination as to apportionment among defendants for the purposes of this Division is conclusively binding on the defendants for the purposes of the settlement, or determination by the Tribunal, of the plaintiff's claim and payment of the plaintiff's damages.
(2) The agreement or determination is not binding for the purposes of the subsequent taking, or determination by the Tribunal, of a dispute between defendants as to apportionment.
(3) If a defendant disputes the contribution that the defendant is liable to make to damages recovered by the plaintiff and the judgment of the Tribunal in the dispute does not result in the defendant materially improving the defendant's position, the defendant is liable to pay the costs of each other party to the dispute occasioned by the dispute, assessed on an indemnity basis."
Div 6 of Part 4
Division 6 of Part 4 of the DDT Regulation 2007 was introduced in consequence of a review of the CRP: Attorney-General's Department of NSW and the Cabinet Office, Review of the Dust Diseases Claims Resolution Process (January 2007). Among the matters addressed by the Review was Issue 23: " Should cross-claims be subject to the CRP where the plaintiff's claim has resolved or is suspended? "
In its discussion of this issue, the Review noted (at [7.4.2]) that submissions had been sought as to whether the CRP should be undertaken:
"where cross claims remain after the plaintiff's claim has settled or where cross claims are brought separately from the plaintiff's claim ". (Emphasis added.)
The Review considered (at [7.4.3]) that there was
"a good argument that a contributions assessment should still be made once the plaintiff's claim has resolved to provide an incentive for the defendants and cross defendants not to litigate the cross claims further.
Likewise, applying the contributions assessment provisions and associated cost sanctions if a new cross claim is brought would provide an incentive to the existing and new defendants to act commercially in resolving the cross claim".
The Review recommended (Recommendation 8) that the DDT Regulation 2001 be amended to provide, among other things:
" . that the contributions assessment provisions should continue to apply, even if the claim with the plaintiff has been resolved; and
. that modified contributions assessment provisions should apply where a separate claim for contribution is brought in separate proceedings after the conclusion of the plaintiff's claim ". (Emphasis added.)
The Explanatory Note accompanying the DDT Regulation 2007 did not explicitly state that the Regulation was intended to implement the recommendations of the Review. However, the Explanatory Note recorded that the Regulation was to be remade in substantially the same form as the DDT Regulation 2001, but with certain changes. These included provisions:
"(a) to state the objectives of the claims process for claims involving asbestos-related conditions, and
...
(c) to extend the contribution assessment provisions to new classes of claims ..."
The heading to Div 6 of Part 4 of the DDT Regulation 2007 is " Special provision for apportionment claims commenced after plaintiff's claims finalised. The relevant provisions of Div 6 are as follows:
" 54. Application and interpretation
(1) This Division applies to a claim for contribution (the new cross-claim ) made by a defendant (including a cross-defendant) to a claim (the original claim ) when proceedings on the new cross-claim are commenced after the original claim has been settled or determined, but only if the original claim was commenced by statement of claim filed on or after 1 July 2005.
(2) The plaintiff on the new cross-claim is referred to in this Division as the initiating defendant and a defendant on the new cross-claim is referred to as a new defendant . The defendants (including any cross-defendants) on the original claim are referred to as the original claim defendants .
...
55. New cross-claim subject to claims resolution process
(1) Despite clause 18, a new cross-claim to which this Division applies is subject to the claims process once the claim is filed and until:
(a) the defendants to the claim agree as required by Division 5 to the contribution that each is liable to make to damages recovered by the plaintiff on the original claim, or
(b) failing agreement, a Contributions Assessor has determined under Division 5 the contribution that each defendant is liable to make.
...
56. Copies of original claim particulars and replies to accompany new cross-claim statement of claim
(1) The initiating defendant must serve with the statement of claim for the new cross-claim copies of each of the following:
(a) the statement of particulars of the plaintiff on the original claim, and
(b) the replies of each of the original claim defendants to the original claim, and
(c) an appropriately revised version of Part 8 (Apportionment of liability among defendants) of Form 2 of the initiating defendant's reply to the original claim against the defendant, and
(d) any agreement among the original claim defendants as to the contribution that each is liable to make to damages recovered on the original claim, and
(e) any determination by a Contributions Assessor as to the contribution that the original claim defendants are liable to make to damages recovered on the original claim.
...
57. Notice to original claim defendants of new cross-claim
(1) The initiating defendant must give notice in writing of the commencement of proceedings on the new cross-claim to each of the original claim defendants who was a party to the original claim at the time of the agreement or determination as to contribution on the original claim and must give that notice before or at the time that the statement of claim in the new cross-claim proceedings is served.
(2) The initiating defendant must also serve on each of those original claim defendants, at the same time as the statement of claim for the new cross-claim is served:
(a) a copy of the statement of claim for the new cross-claim, and
(b) a copy of the appropriately revised version of Part 8 (Apportionment of liability among defendants) of Form 2 of the initiating defendant's reply to the original claim against the defendant (as served with the statement of claim for the new cross-claim).
(3) Each original claim defendant may elect whether or not to be subject to a new apportionment of liability on the original claim among defendants including any new defendants.
...
(6) Failure to elect within the required time constitutes an election not to be subject to a new apportionment of liability.
...
58 New apportionment under Division 5
(1) The provisions of Division 5 apply again in respect of the original claim and the original claim defendants (with the new defendants included as defendants to the claim), subject to the following modifications and clarifications:
(a) agreement as to apportionment must be reached no later than 70 business days after service of the statement of claim for the new cross-claim on the last of the new defendants,
(b) agreement as to apportionment is only required to be reached by (and is only binding under clause 52 on) such of the original claim defendants as have elected to be subject to a new apportionment of liability on the original claim and the new defendants,
(c) a Contribution Assessor's determination as to apportionment under Division 5 is to be made within 80 business days after service of the statement of claim for the new cross-claim on the last of the new defendants,
(d) the Contribution Assessor's determination is to be a determination of the contribution that each defendant is liable to make, including (in addition to new defendants) all original claim defendants whether or not they have elected to be subject to a new apportionment of liability on the original claim but is not binding under clause 52 on an original claim defendant unless the defendant elected to be subject to the new apportionment of liability,
(e) the Contribution Assessor's determination cannot increase any contribution already determined by a Contribution Assessor in respect of an original claim defendant.
(2) A reference in this clause to the service of the statement of claim for the new cross-claim on the last of the new defendants is a reference to service of that statement of claim:
(a) if there is only one new defendant - on that defendant, or
(b) if there is more than one new defendant - on the last of the new defendants to be served."
1946 Act
Section 5(1) of the 1946 Act provides that where damage is suffered by any person as a result of a tort:
"(c) any tort-feasor liable in respect of that damage may recover contribution from any other tort-feasor who is, or would if sued have been, liable in respect of the same damages, whether as a joint tort-feasor or otherwise".
In any proceedings for contribution under s 5, the amount of contribution recoverable from any person is such as may be found by the court to be just and equitable: s 5(2).
CP Act
Section 90 of the CP Act provides that the court is, at or after trial, or otherwise as the nature of the case requires, to give such judgment as the nature of the case requires.
REASONING
It might be thought that the language of Div 6 of Part 4 of the DDT Regulation 2007 clearly demonstrates an intention that a modified CRP is to apply where, after settlement of the plaintiff's claim, an original defendant brings claims for contribution in separate proceedings. Clause 54 states that Div 6 applies to a claim for contribution (which is designated as " the new cross-claim ") by a defendant or cross-defendant to a claim, when proceedings on the contributions claim are commenced after the original claim has been settled or determined. This language plainly contemplates that the CRP, as modified by cl 58, is to apply to fresh contribution proceedings instituted by a defendant or cross-defendant after the original proceedings commenced by the plaintiff have been settled or determined.
If there were any doubts as to whether Div 6 was intended to operate in this way, they would seem to be resolved by the references to a claim for contribution being commenced by " statement of claim ": cll 56(1), 57(1), (2), 58(1), (2). A cross-claim in existing Tribunal proceedings is made by filing a statement of cross-claim or a cross-summons: Uniform Civil Procedure Rules 2005 (" UCPR "), r 9.1(1), (2). Proceedings are commenced in the Tribunal by the plaintiff filing a statement of claim or a summons: UCPR, r 6.2(1). The UCPR clearly distinguish between a statement of cross-claim and a statement of claim (see r 9.1(2)) and the choice of language in Div 6 appears to be quite deliberate. (The UCPR apply to proceedings in the Tribunal, unless excluded or overridden by " local rules ": UCPR, r 1.5, sch 1, 2.)
There are other indications that Div 6 is intended to apply to separate contribution proceedings. The heading to Div 6, which forms part of the DDT Regulation 2007 ( Interpretation Act 1987 (NSW) (" Interpretation Act "), s 35(1)(a)), suggests that Div 6 is intended to apply to apportionment claims commenced in separate proceedings. Whether or not it is possible for cross-claims to be filed in the very proceedings which have been " finalised ", ordinarily it would be expected that an apportionment claim after finalisation of the plaintiff's claim would be commenced in separate proceedings. Clause 54(2) refers to the " plaintiff on the new cross-claim " and to a " defendant on the new cross-claim ", not to a cross-claimant or cross-defendant as would be the case if the cross-claim was filed in the original proceedings. Clause 55 excludes cl 18 evidently for the purpose of specifying the duration of the CRP where fresh contribution proceedings have been commenced by an original defendant (or original cross-defendant).
This construction of Div 6 gives effect to the recommendations made by the Review, in particular the recommendation that modified contributions assessment provisions should apply where a separate claim for contribution is made in separate proceedings. It is difficult to see how the recommendation could have been expressed more clearly. If there were any ambiguity in the language of Div 6, the fact that Div 6 is intended to give effect to the Review's recommendations would suggest that the ambiguity would be resolved against the appellant's construction.
Mr Parker SC, who appeared for the appellants, acknowledged in oral argument that:
- the Review explicitly recommended the extension of a modified CRP to separate contribution proceedings commenced by a defendant to the original proceedings; and
- the language of Div 6 is consistent with an intention by the framers of the DDT Regulation 2007 to implement this recommendation.
Nonetheless, Mr Parker submitted that Div 6 of Part 4 of the DDT Regulations 2007 should be read as limited to a cross-claim brought by a defendant or cross-defendant in the original proceedings.
The starting point for Mr Parker's submission was that it had always been the case that a cross-claim seeking contribution under the 1946 Act could be made by a defendant in the original proceedings, even after the plaintiff's claim had been settled or determined. This proposition was said to be established by the decision of this Court in Seltsam Pty Ltd v Energy Australia [1999] NSWCA 89; 17 NSWCCR 720. Mr Parker contended that Div 6 was intended to extend the CRP only to the case where, after settlement or determination of the plaintiff's claim, a defendant or cross-defendant filed a cross-claim in the same proceedings seeking contribution pursuant to the 1946 Act. The submission assumed that the CRP could not apply in such a case under the DDT Regulation 2001 .
Mr Parker identified three considerations that justified construing Div 6 in this way.
First, he submitted that it was doubtful whether s 32H(1)(b) of the DDT Act authorises regulations applying the CRP to separate contribution proceedings instituted by a defendant to the original proceedings. He pointed out that s 32H(1)(b) refers to the apportionment of liability between " defendants and cross-defendants ". This language, so Mr Parker argued, does not support regulations which extend the CRP to separate contribution proceedings. As in the present case, the defendants in the separate contribution proceedings may never have been named as defendants or cross-defendants in the original proceedings. To avoid possible invalidity, Div 6 should be construed as limited to cross-claims filed in the original proceedings after the plaintiff's claim in those proceedings has been settled or determined.
Secondly, Mr Parker submitted that cl 14 of the DDT Regulation 2007, shows that Part 4 is intended to apply only to a cross-claim made in the original proceedings by a defendant or cross-defendant to those proceedings.
Thirdly, Mr Parker submitted that the reference to " new cross-claims " in cl 54 and elsewhere in Div 6 indicates that Div 6 is intended to apply the CRP only to cross-claims strictly so-called. Since a separate claim for contribution is not a cross-claim in the original proceedings, the language of Div 6 is inapt to apply to a separate claim for contributions.
The appellants' first argument pays insufficient attention to the definitions in Part 3B of the DDT Act which were introduced into the legislation at the same time as s 11(1A) . Section 32G defines " proceedings " to mean proceedings in the Tribunal brought or to be brought under s 11. Thus " proceedings " includes a claim in the Tribunal for contribution brought by a defendant in the original proceedings pursuant to s 11(1A), whether the contribution claim is brought by way of cross-claim in the original proceedings or in separate proceedings. A " claim " means a " claim in proceedings ".
Section 32H(1)(b) of the DDT Act creates a power to make regulations with respect to procedures for the " apportionment of liability between defendants and cross-defendants in connection with a claim ". The expressions " defendants " and " cross-defendants " are given content by the phrase " in connection with a claim ". The words " defendants " and " cross-defendants ", in my opinion, are intended to include defendants and cross-defendants to either or both of the original claim (commenced by the plaintiff) or the separate claim for contribution (commenced by a defendant or cross-defendant in the original proceedings). Mr Parker did not put forward any cogent reason why, having regard to the definition in s 32G, " claim " in s 32(1)(b) should be read as limited to the original claim made by the plaintiff, particularly as a reference to a word in singular form includes a reference to the word in plural form: Interpretation Act , s 8(b).
In any event, as Mr Sullivan QC, who appeared with Mr Miller for Babcock pointed out, it would seem that Div 6 of Part 4 of the DDT Regulation 2007 can be supported as an exercise of the regulation-making power conferred by s 32H(1)(a) of the DDT Act . This provision authorises " the establishment of a claims resolution process for claims ". Since " claims " includes a separate claim for contribution by an original defendant, the extension of a modified CRP to such a contribution claim would appear to fall squarely within the power granted by s 32H(1)(a). There is no occasion to read the second part of s 32H(1)(a) as limiting the generality of the opening words.
There are several answers to the appellants second argument. Clause 14, despite its heading (which does not form part of the Regulation: Interpretation Act , s 35(2)), does not say that Part 4 applies only to a cross-claim by a defendant to the plaintiff's original claim. It is therefore not inconsistent with Div 6 applying the CRP to a separate claim for contribution by a defendant to the original proceeding.
If cl 14 is to be construed as if the word " only " is included, the reference to " cross-claim by a defendant " should be read as extending to a separate claim for contribution made by a defendant in the original proceedings. The DDT Regulation 2007 must be read as a whole. Division 6 refers to a claim for contribution as a " new cross-claim ". This shorthand expression, as I have explained, is not entirely accurate, given the textual indications that it is intended to include a claim for contribution made in separate proceedings. Nonetheless, it is a clear indication that the drafter of the DDT Regulations 2007 intended that a contribution claim by an original defendant in separate proceedings should be regarded as a " cross-claim " for the purposes of cl 14.
In any event, even if the language of cl 14, considered in isolation, can be read as intended to limit the scope of Part 4, it must yield to the clear intention of Div 6. Clause 14 is in the same terms as cl 12 of the DDT Regulation 2001. There was no equivalent to the current Div 6 in the DDT Regulation 2001. The addition of Div 6 requires cl 14 to be construed as subject to the clearly expressed intention to extend a modified CRP to separate contribution proceedings. Clause 14 would then be read as applying only to the CRP dealt with in Div 5 of Part 4.
The appellants' third argument attributes too much weight to what is merely a convenient drafting device. The expression " new cross claim " in cl 54 is used by the drafter as a convenient shorthand descriptor for
"a claim for contribution ... made by a defendant ... to a claim when proceedings ... are commenced after the original claim has been settled...".
The shorthand expression, perhaps influenced by the terms of cl 14, is as I have explained, not entirely apt. But it cannot control the meaning of Div 6 when the language, read as a whole, is intended to extend a modified CRP to separate proceedings for contribution.
I have assumed, when considering the appellants' submissions, that Mr Parker's starting point is correct. However, it is by no means clear that a cross-claim can be filed as a matter of course in the original proceedings, after the plaintiff's claim has been settled or determined. Seltsam v Energy Australia , upon which Mr Parker relied, arguably turned on the fact that the cross-claimant had been granted leave to file a cross-claim before the plaintiff's claims were settled, although the cross-claim was not ultimately filed (pursuant to an extension of time) until after judgment had been entered in favour of the plaintiff: at 737 [41], per Giles JA (with whom Priestley JA agreed); at 741-742 [58], per Fitzgerald JA (dissenting).
It is not necessary to decide the circumstances in which a cross-claim can be filed in the original proceedings after the plaintiff's claim has been settled or determined. A full examination of this issue might require consideration of the interaction between cl 25, especially cl 25(9), and cl 19(2)(e) of the DDT Regulation 2007. Whatever those circumstances might be, they cannot affect the question of construction that arises in the present case.
CONCLUSION
Division 6 of Part 4 should be construed in accordance with its plain meaning. So construed, the CRP applies to a claim instituted in separate proceedings by a defendant to the original proceedings after the plaintiff's claim in the original proceedings has been settled or determined. This construction gives effect to the recommendations of the Review , which led to the making of the DDT Regulation 2007. It also gives effect to the rationale for the Review's recommendation, namely to provide an incentive, through CRP, to what it calls " defendants " and " cross-defendants " to act commercially in resolving their disputes.
The appellants should be granted leave to appeal. However, the appeal should be dismissed. The appellants should pay Babcock's costs of the appeal.
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Decision last updated: 18 May 2011
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