Crawther & Anor v Rahim

[1997] HCATrans 358

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P65 of 1996

B e t w e e n -

DARYL MARK CRAWTHER

First Applicant

PETER KUNST

Second Applicant

and

FIONA ANNE RAHIM

Respondent

Application for special leave to appeal

BRENNAN J
TOOHEY J
HAYNE J

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO CANBERRA

ON MONDAY, 8 DECEMBER 1997, AT 12.54 PM

Copyright in the High Court of Australia

MR S. WALSH, QC:  If the Court pleases, I appear with my learned friend, MR M.C. LIVESEY, for the applicants.  (instructed by Ward & Partners)

MR R. LEMIERE, QC:  If the Court pleases, I appear with my learned friend , MR T. LAMPROPOULOS, appear for the respondents.  (instructed by Simon Walters)

BRENNAN CJ:   Yes, Mr Walsh.

MR WALSH:   If the Court pleases, there are two primary special leave issues which we raise.  The first is whether the choice of law rules applicable to actions in tort are concerned merely with the issue of justicability or also provide the choice of the law to be applied.  That raises the question of whether, as a result of the decision of this Court in McKain v Miller, the substantive law of the lex loci is to be applied or, if it is not to be applied, what law is to be applied and might it be the lex fori.  And we say that since the decision of Stevens v Head there has been some uncertainty in this area that has developed through the decisions of State courts.

BRENNAN CJ:   In this case, the question is whether or not subsection (7) of the South Australian Act was to be applied in the action brought in the Western Australian Courts.  That is the point, is it not?

MR WALSH:   Yes, that is the point and it is the second issue which we raise.

BRENNAN CJ:   Is that not the only issue in the case?

MR WATERS:   Not so, your Honour, in this sense:  that if, in fact, we succeed and the question that we raise is correct, namely, that section 35a(7) is substantive law - if it only goes to a question of justicability then the next question arises is when the matter is heard before the Western Australian Court, is that law to be applied or will it nevertheless, because it is justiciable only, the court apply the law of Western Australia alone.

BRENNAN CJ:   I must confess this dichotomy sometimes alludes me.  We have a case pending in Western Australia.  The plaintiff comes and says, “I want damages because I was injured in an accident in South Australia, and the Western Australian court says, “That is a cause of action that is known here.  It is a cause of action that is known in South Australia.  So you can bring your action in this court”.  And then the court says, “We apply substantive law and we apply procedural law.  So far as procedural law is concerned, we apply our own law.  Substantive law is relevant to discover whether or not you can bring the action here.  And you can.”  Now, where does the problem arise when the Western Australian court says, “Damages, we have been told, are procedural and therefore you apply our law in relation to damages.”?

MR WALSH:   But that, of course, assumes that a decision has been made that the issue that arises under section 35a is, in fact, procedural law only and ‑ ‑ ‑

BRENNAN CJ:   By Western Australian law.

MR WALSH:   By Western Australian law.  And in the process of reaching that decision one of the issues that we seek to agitate is what part does the law of the lex loci, namely, the South Australian law, apply with respect to the proper characterisation of that law and that is not answering your Honours question.  Your Honour is putting to me, “Well, what is going to happen in the event that the matter is resolved one way or the other?”  If it is resolved, that is procedural law, then of course, that is the end of the matter.  But if we are correct, and the matter is resolved on the basis that it is, in fact, substantive law, namely, section 35a is substantive law, and if, in fact, that question has been asked only in the context of whether there is an action that is justiciable in Western Australia and the law is that after that point you then apply the law of the forum, not the law of the lex loci, then, in effect, what has happened is that the South Australian substantive law has not been applied and we seek to agitate the question of what is the law to be applied in the circumstances that it is declared to be substantive.

HAYNE J:   Do you point to any statement in any authority which suggests that the question of characterisation is to be resolved other than by the law of the forum?

MR WALSH:   There is authority in the South Australian Full Court decision of Nalpantidis v Starke which addresses this question.  His Honour Chief Justice Doyle adverted to this issue and he suggested that the appropriate answer to that question is that it plays some part.  It will be a question ‑ ‑ ‑

HAYNE J:   That the law of the forum plays a part?

MR WALSH:   That the law of the lex loci will play some part.  So, for instance, in this case what we would argue is that the lex loci, the South Australian law, has sought to characterise this law as a substantive law.  Of course, the Western Australian court will not simply look at that assertion alone and make a determination on that assertion alone.  What the Western Australian court will do, in our respectful submission, is look to the circumstances in which the law applies in South Australia, what Parliament has provided by way of the law as being in a sense a substantive as opposed to procedural.  It will ignore issues of mere form as opposed to simply issues of substance.  It will, in fact, heed what Parliament has done, if in fact it has done that, namely, in the lex loci.  So the law of the lex loci in that sense does play a part in the process of the proper characterisation.

BRENNAN CJ:   These phrases “heeding” and “playing a part” I find a little elastic.  What do they do?  What does the Western Australian court do, knowing that there is 35a(7) on the South Australian statute books?

MR WALSH:   What the Western Australian court does is to properly characterise that law; but given what the intention of Parliament in South Australia with respect to the kind of law that it was proposing to enforce and the way in which it works, is a matter of fact within South Australia, as a law.  So that, for example, if in fact it is clear that what Parliament was saying is that, here is a scheme which is intended to affect substantive rights and liabilities - and it does that, of course, by way of subsection (7) and subsection (8).  It affects substantive rights and liabilities, so that when people come ‑ ‑ ‑

BRENNAN CJ:   But it does not; it just says how you assess damages.

MR WALSH:   But that is the effect of the law, because what it is doing is it saying to people who come to South Australia that, “You come to our South Australia State, the scheme is such”, almost like a quasi-contractual argument or, alternatively, of its own right, that “If you come to that State the fact is that you are limited in the damages that you may claim.  There is a partial, as it were, abolition of the right to full common law damages.

BRENNAN CJ:   There is that right, that limitation, but it says, “If you come to South Australia and you are injured as the result of negligence in a motor car accident, you can get damages, but your damages will be limited in the following way.  Not only that, if you go home and then get higher damages there, because of the operation of the rules of private international law, then we will try and get it back from you.”  That is what South Australia has done ‑ ‑ ‑

MR WALSH:   And the scheme ‑ ‑ ‑

BRENNAN CJ:    ‑ ‑ ‑ it is directed specifically at damages.

MR WALSH:   In our respectful submission, the way in which the scheme works indicates that it is not directed solely at the issue of damages because it enforces the issue in a substantive way.  It enforces the issue of the limitation of damages in a substantive way, and it does so by way of the operations of subsections (7) and (8).  So that, in this context of the way in which it is intended to work, it is, in truth, enforcing it in a way in which it affects, and is intended to affect, rights and liabilities.  Even if one compares the Victorian situation, namely, that which was the subject of the action in Thompson v Hill, in Wilson v Nattrass, the Victorian Supreme Court, and also if one looks at Nalpantidis v Stark which was dealing with the same statute, the way that statute works is that it, up front, suggests that there was a limitation of liability.  This statute, true, puts it a different way.  It puts it in a way which seeks to enforce the substantiveness of it in a different context but the result is the same.

BRENNAN CJ:   You keep using the word “substantive”.  Are you using it as meaning anything else but a limitation on damages?

MR WALSH:   It is a limitation on the right to claim damages under certain heads which is limited to the extent that, if a court orders otherwise, then there is an entitlement to recoupment.  That is the substantiveness.  That is the way that it enforces the issue substantively.

BRENNAN CJ:   What you mean is that there is a remedy provided if a court should award damages on any basis other than that which is proscribed by subsection (7).

MR WALSH:   And in a sense that was a similar position under the Transport Accident Act except it was properly characterised by three Full Courts as being one which limited the right itself, and the court has spoken of limitations, or this Court, of limitations of right or the partial extinguishment.  The way in which this legislation works is to partially extinguish the right to claim damages because of the way in which Parliament has gone about seeking to ensure that there is an enforcement of that substantive position.

BRENNAN CJ:   And what work is there for subsection (8) to do?

MR WALSH:   The work for subsection (8) is, in effect, there in the event that a court chooses not to recognise the substantiveness of the law, so that subsection (8) ‑ well, there is, I suppose, the final statement by the Parliament that it is to be substantive, and in the event that it is not treated as substantive, then you may recover.

TOOHEY J:   Well, when you put it that way, Mr Walsh, why do you stop short of saying that the intention of Parliament, as reflected in the legislation, determines the question of characterisation in the court in Western Australia?  Why say it has a part to play?  It really has a complete role to play or none, does it not?

MR WALSH:   Well, it does in one sense, yes, your Honour.  I accept the criticism of the way in which I put it.  But the way I intended it was in this way, that if the Parliament or the law of the lex loci is clear, that it is a substantive law, then there is no question that the court of Western Australia will characterise it as a substantive law.  But in cases where there is some doubt - - -

HAYNE J:   But will do so applying its own law.

MR WALSH:   Indeed.

HAYNE J:   The characterisation question is a question for the law of the forum, is it not?

MR WALSH:   Indeed, your Honour, and that is why it is that I put the question, or at least put the proposition, in the way that I do, that it is, of course, for the court in Western Australia to properly characterise the law.  But all it is doing is looking at the law to see whether it is, in truth, a substantive law or not and if the Parliament in the lex loci has determined that it is, in fact, or at least indicated that it is substantive, then of course that will be relevant to the court in Western Australia in reaching a conclusion, that it is in fact substantive.  It will look to see what Parliament has intended and the way in which it operates.

As his Honour Chief Justice Doyle said in Nalpantidis v Stark, what the court will do is that, in my opinion, if I may just quite briefly, the court must consider how the Victorian provision operates within the body of Victorian law, that is the same as South Australia in this case, applying the forum’s understanding of substance and procedure, and that that is how the matter appears to have been approached in McKain and Stevens.  His Honour also spoke about, as I say, operating within the body of Victorian law or, in this case, how does it work operating within the body of South Australian law.

In our respectful submission, the way in which it works, operating within the body of South Australia law, is that it is manifestly clear that it is intended to be an abrogation, a partial extinguishment of the ordinary entitlement to common law damages.

HAYNE J:   Could there be any change in the way in which damages are assessed that could not be described in those terms?

MR WALSH:   I suppose we could go to - in answer to that, one could go to the Transport Accident Act and put the same proposition, and yet we know that, in that case, the court had finally determined - three courts have determined that is, in fact, substantive law and, in effect, determined it because it spoke about the issue of liability.  That was the key word, the “liability” of the parties, under the Transport Accident Act, is not at common law, but now subject to this method of assessment.

If one looks at subsections (7) and (8), the effect of it is exactly the same; that the liability, at the end of the day, is to be on the basis that damages should be assessed only in accordance with this section, section 35a.  So, it is, in truth, enforcing it - as I indicated earlier, enforcing or seeking to enforce the law in a substantive way.  I suppose if we move even past that particular point, and when we go to the first point which I raised, namely, the choice of law rules applicable.  Do they deal only with the issue of justiciability.  Because of the decision of, for instance, Clarke JA and the case of Thompson v Hill, it is clear that there is, at least, some authority for the view that not only is there some confusion with respect to the answer to the question, “Is it justiciable only or not?”, but there is also a conclusion by his Honour that, in fact, the law for lex fori, or the lex fori should apply its law, as opposed to, for example, in this case, the court determining that it should be the lex loci - the law of the lex loci - or, in the case of his Honour Chief Justice Doyle, that it should be an application of, in a sense, both laws, namely, both - - -

BRENNAN CJ:   No, that is not what Chief Justice Doyle said.  Chief Justice Doyle said, using the classification procedure of South Australian law, we look to see what the substantive law of Victoria is and that, if I might say so, seems to me to be precisely what the Western Australian Full Court has done here.

MR WALSH:   Your Honour, his Honour, Chief Justice Doyle, did say, at page 457 - it is tab 5 - I do not necessarily take you to it, but its tab 5 on page 457 - that:

Thirdly, the cause of action -

this is at the foot - page 457, tab 5, the last paragraph:

Thirdly, the cause of action which is enforced under these rules is a cause of action under the law of South Australia as the law of the forum, although it is a cause of action which reflects the content of South Australian law applicable to events occurring in South Australia and the law of Victoria (on the present facts) applicable to events occurring in Victoria.

BRENNAN CJ:   That is right.

MR WALSH:   But if one looks at the decision of his Honour Justice of Appeal, Clarke J, in Thompson v Hill, the clear conclusion that his Honour reaches is that you apply the law of the forum at that stage, namely, after you have gone past the issue of justiciability, you apply the law of the forum and that was applied by his Honour, Justice James, in Sumulski’s Case, which is a decision of - - -

BRENNAN CJ:   There is only one law which any court is capable of applying, and that is the law of the forum.  If it looks to the law of the lex - of the place, it does it because the law of the forum tells it to.  So, the law of Western Australia is the only law that we are concerned with here, and the Western Australia court looks to the law of South Australia to answer the question of whether or not the tests which are expressed in McKain v Miller are satisfied.

MR WALSH:   And then after, determining that it has been satisfied if it does so, then, “Which law should it apply?”, is the question which next must be asked, in our respectful submission, and there is divergent authority with respect to the next step after that point.  That is the dilemma that was raised by Professor Davies in tab 24, volume two, of our authorities.  At tab 24, volume two, one can see that, at page 712, it is the second page of the text in the second paragraph of the top left-hand corner:

There are at least three matters that are left unresolved -

I will not read it, I will leave it to the Court to read.  The learned author, at page 714 - and I will not take you through it - deals with the position of Clarke JA, and then the position of his Honour Justice Dawson in Gardner’s Case, and his Honour Justice Dawson referred, in that case, to a misunderstanding that seems to have, as it were, crept in to this question, and then the learned author concluded that there is, in fact, a disparity of opinion; there is confusion. 

That same confusion was referred to by his Honour Clarke JA, in Thompson v Hill.  He clearly said in his conclusion there was confusion on the authorities because it is the confusion that one gets when one gets to the stage of post‑determination of justiciability.  Most of the cases that have been decided thus far, for instance, McKain v Miller and Nalpantidis v Stark, and Thompson v Hill, they only needed to deal with the issue, of course, of justiciability because it did not go past that level once the question was answered at that level of inquiry.  But, it is in the next case, for example this case, where, if we are right and section 35a is the substantive

law, then what next?  What is to apply then?  And, there is a difference of opinion, in our respectful submission, in the authorities in the way the authorities are treating the decision in McKain v Miller.  For example, his Honour Justice Dawson, in Gardner’s Case, referred to the fact that there was a misconception because of a concession made in McKain v Miller, that, in fact, the lex loci would apply, and that that then permeates some of the reasoning process of courts since that point of time.   In our respectful submission, they are our submissions.

BRENNAN CJ:   Yes, Mr Walsh.  We need not trouble you, Mr LeMiere. 

The decision of the Full Court of the Supreme Court of Western Australia was correct.  For that reason special leave is refused.

MR LeMIERE:   If it please the Court, I seek an order for the costs.

BRENNAN CJ:   Do you have anything to say about that, Mr Walsh.

MR WALSH:   I have nothing to say, your Honours.

BRENNAN CJ:   It will be refused with costs.

AT 1.15 PM THE MATTER WAS CONCLUDED