Cadoo v BHP Billiton Limited (No 3) - [2013] SADC 41

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
CADOO v BHP BILLITON LIMITED (No 3)
[2013] SADC 41
Judgment of His Honour Judge Lovell
3 April 2013
PROCEDURE - JUDGMENTS AND ORDERS - SATISFACTION AND SET-OFF OF JUDGMENTS
Judgment obtained against concurrent tortfeasor but stayed and not executed - whether plaintiff can proceed against another defendant and obtain judgment.
Held: Judgment can be entered against this defendant.
Baxter v Obacelo Pty Ltd (2001) 205 CLR 635; Tang Man Sit v Capacious Investments Ltd [1996] AC 514; Smits v Roach (2006) 227 CLR 423; Jameson v Central Electricity Generating Board [1998] QB 323 at 338; Arrow Chemicals Ltd v Guild and Another [1978] SLT 206; Steven v Broady Norman & Co [1928] SC 351, discussed.

CADOO v BHP BILLITON LIMITED (No 3)
[2013] SADC 41
Judgment on Satisfaction

On 16 March 2012, I found the defendant liable in negligence and assessed Mr Cadoo’s damages at $918.50. The defendant argues that the plaintiff has been “satisfied” because of settlements reached with other defendants prior to trial. Therefore, the defendant argued, the plaintiff should not obtain the benefit of a judgment.
History
The following matters are not in dispute:
1.   The plaintiff initially filed, on 2 April 2003, a statement of claim in the Dust Diseases Tribunal (NSW) against five defendants including BHP Billiton (the first defendant). The matter was transferred to South Australia. Only the case against BHP Billiton proceeded to trial.
2.   On 1 August 2008 the plaintiff settled his claim against the second and third defendants for $4000 and $6000 respectively.
3.   On 6 August 2008 the plaintiff settled with the fourth and fifth defendants for $18,000 plus costs. There were problems with the settlement. On 18 May 2009 a consent judgment was entered in favour of the plaintiff against the fourth and fifth defendants in the sum of $18,000 plus costs. Execution of the judgment is the subject of a stay.
On 4 February 2009 the plaintiff filed an application to discontinue against the first defendant (BHP Billiton). An interlocutory hearing was conducted before Judge Brebner. The application was opposed by the defendant subject to the question of it obtaining a costs order against the plaintiff.
The plaintiff withdrew the interlocutory application and the matter was listed for trial. The trial commenced on 1 June 2009. By agreement between the parties this matter ran concurrently with the trial of Parker v BHP Billiton Limited.[1]
[1] [2011] SADC 104.
Rule against Double Satisfaction
The defendant argued that the plaintiff did not have a cause of action, as if I were to enter judgment for the plaintiff against BHP Billiton Limited, he would receive “double satisfaction”. It was submitted that in this case, the plaintiff’s loss had been wholly compensated by his settlements with other defendants and therefore, further proceedings in respect of the same damage would lack subject matter. It was further argued that the plaintiff had admitted, during the course of interlocutory proceedings, that he had received “satisfaction”.
In the alternative the defendant argued that, given the consent judgment entered in favour of the plaintiff on 18 May 2009 against the fourth and fifth defendants, (subject to a stay) it would be “unconscientious” for the plaintiff to have maintained his action against it and that I should therefore not enter judgment for the plaintiff. Indeed the defendant suggested I should enter judgment in its favour.
A plaintiff cannot recover in aggregate from one or more defendants an amount in excess of his loss. Once a plaintiff has fully recouped his loss, he cannot thereafter pursue any other remedy he might have and which he might have pursued earlier. Having recouped the whole of the loss, any further proceeding would lack a subject matter. Further, it would be inequitable to permit recovery.
Part satisfaction of a judgment against one person does not operate as a bar to the plaintiff thereafter bringing an action against another who is also liable, but it does operate to reduce the amount recoverable in the second action.[2]
[2] Baxter v Obacelo Pty Ltd (2001) 205 CLR 635; see also Tang Man Sit v Capacious Investments [1996] AC 514.
It is also not in dispute that the defendants to this action are “several concurrent tortfeasors” in that they are independent tortfeasors whose separate acts combine to produce the same damage.
The defendant argued that the plaintiff’s claim had been satisfied. It is not in dispute that a plaintiff cannot recover more than he has lost.
As mentioned the defendant relied on three grounds.
First, the defendant relied on the submissions made by Mr Wells QC, counsel for the plaintiff, before Judge Brebner on 11 February 2009. At that stage the issue between the plaintiff and the defendant Bells had not finally resolved. As discussed, the plaintiff made an interlocutory application for leave to discontinue the proceedings as against the defendant BHP Billiton Limited. The application was supported by an affidavit of Ms Hoffman, the solicitor for the plaintiff, where she said, inter alia:
21. On 4 February 2009 the plaintiff instructed Turner Freeman to file an Application to discontinue the proceedings against the remaining defendant, BHP Billiton Limited, as the amount contained in the Deed [agreed with the fourth and fifth defendants] represents what the plaintiff says is compensation under the heads of the claim. The plaintiff says that the asbestos-related disease was caused by all the defendants but does not wish to pursue action as he has been adequately compensated for damages claimable.
22. He instructed Turner Freeman that the Estate has now been satisfied and he does not instruct Turner Freeman to seek further damages from the first defendant.
Mr Wells QC, who at that time was counsel for the plaintiff said, during the course of submissions:
[T]he proposed amount [in the settlement with the fourth and fifth defendants] was identified and has been identified by the plaintiff as an adequate compensation for his loss and that it would not be open to him to prosecute a claim in this case against BHP because if he proceeded to do so he would be on that basis abusing the process of the court in seeking double satisfaction.
The defendant argued before me that the plaintiff was now bound by the statements made by both Ms Hoffman and Mr Wells QC. The plaintiff, through his legal representatives has “admitted” that he has received adequate compensation.
The defendant argued that a party to litigation is bound by the conduct of counsel.[3]
[3] Smits v Roach (2006) 227 CLR 423.
The question of whether the plaintiff was bound by the conduct of his legal representatives was a matter that should have been pleaded and evidence called during the hearing. As Mr Lee SC, counsel for the plaintiff argued, it is too late in these circumstances to ventilate such an issue. The plaintiff has not had the opportunity to consider whether, for example, he would need to call evidence in the matter.
The parties left open the question of “satisfaction” until the end of the trial. I presume that such a forensic decision was not taken lightly. I agreed to hear the parties on that matter after I delivered reasons in this matter but before entering judgment. There were delays in listing this argument due to difficulties in finding a mutually suitable time for senior counsel. The defendant did not seek to amend its pleadings to put the plaintiff on notice of this particular argument before, during or after the trial.
I find the defendant is not entitled to rely on this ground of its argument.
I note in passing that the matter was listed for trial very quickly after the plaintiff withdrew the interlocutory application. Both parties agreed to have the matter heard concurrently with the Parker matter. The defendant at that time made no application to amend its pleadings or put the plaintiff on notice that it would be relying on the “conduct of his legal representatives” at the interlocutory hearing to, in effect, stop a judgment being entered.
The defendant relies on two further arguments. The defendant submitted that a plaintiff can be “satisfied” when he has the benefit of a judgment or binding contract to settle an action. It is, so it was suggested, not necessary for there to be “execution” of the judgment. The fact that judgment had been entered and was enforceable was sufficient for the court to decide that the plaintiff had received satisfaction.
In the alternative, the defendant argued that if the judgment did have to be “executed” here, there was no explanation for why the judgment obtained against the fourth and fifth defendants remained unexecuted. It was argued that it would be “unconscientious” for a plaintiff not to execute on a regularly obtained judgment for purely tactical reasons. The defendant argued that there was an onus on the plaintiff to establish the reasons for not executing the judgment. If they failed to explain why the judgment had not been executed the court could find their conduct to be unconscientious.
It is common ground that on 18 May 2009 a consent judgment was entered in favour of the plaintiff against the fourth and fifth defendants in the sum of $18,000 plus costs.
The plaintiff accepted that the judgment sum entered in favour of the plaintiff against the fourth and fifth defendants is greater than the total awarded by me of $15,308.30 of which six per cent, namely $918.50, was attributable to the plaintiff’s exposure at the Whyalla Shipyard.
It is also common ground that there is a stay of execution on that judgment, pending resolution of the question of legal costs. The question of costs has not as yet been resolved and therefore the stay remains in place.
The issue of satisfaction was considered by the High Court in Baxter v Obacelo Pty Ltd.[4] Gleeson CJ and Callinan J stated:
In Tang Man Sit v Capacious Investments Ltd[5] the court stated:
“Faced with cumulative remedies a plaintiff is not required to choose. He may have both remedies. He may pursue one remedy or the other remedy or both remedies, just as he wishes. It is a matter for him. He may obtain judgment for both remedies and enforce both judgments. When the remedies are against two different people, he may sue both persons. He may do so concurrently, and obtain judgment against both. Damages to the full value of goods which have been converted may be awarded against two persons for successive conversions of the same goods. Or the plaintiff may sue the two persons successively. He may obtain judgment against one, and take steps to enforce the judgment. This does not preclude him from then suing the other. There are limitations to this freedom. One limitation is the so called rule in Henderson v Henderson ... In the interests of fairness and finality a plaintiff is required to bring forward his whole case against a defendant in one action. Another limitation is that the court has power to ensure that, when fairness so requires, claims against more than one person shall all be tried and decided together. A third limitation is that a plaintiff cannot recover in the aggregate from one or more defendants an amount in excess of his loss. Part satisfaction of a judgment against one person does not operate as a bar to the plaintiff thereafter bringing an action against another who is also liable, but it does operate to reduce the amount recoverable in the second action. However, once a plaintiff has fully recouped his loss, of necessity he cannot thereafter pursue any other remedy he might have and which he might have pursued earlier. Having recouped the whole of his loss, any further proceedings would lack a subject matter. This principle of full satisfaction prevents double recovery.” (my underlining)
[4] (2001) 205 CLR 635.
[5] [1996] AC 514 at 522.
In Jameson v Central Electricity Generating Board Auld LJ said:
The defence of satisfaction, in the sense of full satisfaction of a wrong or liability, is different from that of accord and satisfaction. First, it must be full satisfaction and, second, it must be given, executed. Its basis is the simple one that a claimant should not receive more than is necessary to compensate him for the wrong or wrongs done to him or in respect of the liability or liabilities owed to him. Where accord and satisfaction cannot be relied upon, as where a claimant settles with one of two concurrent tortfeasors, the tortfeasor facing a claim will nevertheless have a defence if the plaintiff’s settlement with the other has fully compensated him for the separate wrongs done to him.[6]
[6] [1998] QB 323 at 338.
That passage was cited with approval by Gummow and Hayne JJ in Baxter. They went on to say:
The subject is best illustrated with reference to the treatment by Viscount Simon LC in United Australia Ltd v Barclays Bank Ltd of the decision of the Court of King’s Bench in Morris v Robinson. The Lord Chancellor said of that case: “There, cargo belonging to the plaintiffs had been improperly sold during the course of a voyage. There were thus two lines of remedy which the plaintiffs could pursue. They first brought an action against the shipowners for breach of their duty as carriers, with a count in trover. They recovered a verdict, but they did not enter up judgment and there had been no actual satisfaction of their claim. Instead, they brought another action against different defendants — namely, an action for conversion against the purchasers who had bought the cargo. It was held by the Court of King’s Bench that the former action was no bar, and that the defendants in the second action were liable for their act in purchasing the plaintiff’s goods. Bayley J, in giving judgment, observed: ‘If concurrent actions had been brought, that against the owners could not have barred the other; why then should it have that effect because they have been brought at different times? If indeed the plaintiffs were to recover the full value of the goods in each action, a Court of Equity would interfere to prevent them from having a double satisfaction, but there is nothing in the former action which can, in a Court of Law, prevent the recovery in this.’ (my underlining)
The passages referred to do not support the defendant’s submission. For “satisfaction” to occur a plaintiff has to actually execute the judgment and “recoup” his loss. That has not occurred in this case. It is common ground that the judgment obtained has been “stayed”. A “set off” or at least a partial “set off” of the judgment sum relating to the question of costs remains open. I reject this argument of the defendant.
The defendant submitted however that in the circumstances of this case, where a plaintiff simply fails to execute a judgment that would satisfy his claim, it would be an “unconscientious act” for the plaintiff to pursue a claim against another defendant. As stated in Baxter v Obacelo Pty Ltd:
If it would be unconscientious of the plaintiff to pursue a claim against another tortfeasor, or if the amount received pursuant to the settlement is, or ought to be regarded as, recoupment of the whole of the plaintiff’s loss or damage, then action against another tortfeasor, whether in separate proceedings, or, where the other tortfeasor was a party to the original proceedings, by way of continuation of those proceedings, must fail.[7]
[7] (2001) 205 CLR 635 at 656.
The plaintiff conceded, correctly in my view, that the High Court had left open the right to argue that pursuit of an action may be “unconscientious”.
Mr Parker SC submitted that Arrow Chemicals Ltd v Guild and Another[8] and Steven v Broady Norman & Co[9] supported his proposition that an “onus” lies on a plaintiff to persuade a court that where one judgment has been obtained a plaintiff ought to be allowed to bring an action and obtain a second judgment particularly where the first judgment on the face of it appears to “satisfy” the claim.
[8] [1978] SLT 206.
[9] [1928] SC 351.
In my view there is nothing in the English or Australian cases that would support the position, that absent the issue being pleaded and the point litigated, there is an onus on a plaintiff to establish that he has behaved “conscientiously”.
Although I do not have to decide the point, it is likely that the defendant may bear the onus to establish that the plaintiff behaved “unconscientiously”.
The difficulty facing the defendant with this argument is that, like the earlier matter discussed, it has not raised or pleaded the issue before the commencement of this hearing. No equitable defences have been pleaded, no material facts have been alleged and specifically no defence of unconscionability or the unconscientious exercise of rights is pleaded. It is clearly a matter that should have been raised and the plaintiff given the opportunity to, if so advised, call evidence.
The question of whether an act was “unconscientious” and further, whether statements made during the course of an interlocutory hearing on an application for leave to discontinue could amount to admissions, are issues that needed to be pleaded and fully argued.
I reject the argument of the defendant that in the circumstances of this case there is such an onus on the plaintiff.
In this matter the plaintiff cannot execute his judgment against the fourth and fifth defendants as a “stay” has been ordered. An argument on costs and a potential “set off” of costs against the judgment sum remains to be decided. While the plaintiff holds a judgment it has not been executed. His claim has not been satisfied. He is entitled to a judgment against this defendant. Which judgment he may choose to execute is a matter for him.
I enter judgment for the plaintiff in the sum of $918.50.
Even if I am wrong in relation to that issue, the plaintiff would be entitled to a judgment on the contractual claim for, at least, nominal damages. The defendant did not seriously dispute that proposition. Had I not entered judgment for the plaintiff on the damages claimed founded in negligence, I would have entered judgment for the plaintiff on the contractual claim for nominal damages in the sum of $100.