Curtin University of Technology v Woods Bagot Pty Ltd - [2012] WASC 449

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION: CURTIN UNIVERSITY OF TECHNOLOGY -v- WOODS BAGOT PTY LTD [2012] WASC 449

CORAM: BEECH J

HEARD: 13 NOVEMBER 2012

DELIVERED : 29 NOVEMBER 2012

FILE NO/S: ARB 8 of 2012

BETWEEN: CURTIN UNIVERSITY OF TECHNOLOGY
Applicant
AND
WOODS BAGOT PTY LTD
Respondent

Catchwords:

Commercial arbitration - Question referred by arbitrator - Whether proportionate liability under pt 1F of the Civil Liability Act applies to arbitrations

Legislation:

Civil Liability Act 2002 (WA), pt 1F
Commercial Arbitration Act 1985 (WA), s 22

Result:

Question answered

Category: A

Representation:

Counsel:

Applicant: Mr M Zilko SC & Mr R M Wilenski
Respondent: Mr S K Dharmananda SC & Mr J Maclaurin

Solicitors:

Applicant: Tottle Partners
Respondent: DLA Piper Australia

Case(s) referred to in judgment(s):

620 Collins Street Pty Ltd v Abigroup Contractors Pty Ltd (No 3) [2006] VSC 492
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27
Alliance Petroleum Australia NL v Australian Gas Light Co (1983) 34 SASR 215
Aquagenics Pty Ltd v Break O'Day Council [2010] TASFC 3
Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485
Bennett v Elysium Noosa Pty Ltd (in liq) [2012] FCA 211; (2012) 202 FCR 72
BHPB Freight Pty Ltd v Cosco Oceania Chartering Pty Ltd (No 2) [2008] FCA 1656
Chugg v Pacific Dunlop Ltd [1990] HCA 41; (1990) 170 CLR 249
Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] FCAFC 192; (2006) 157 FCR 45
Cooper Brookes (Wollongong) Pty Ltd v The Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 26; (1981) 147 CLR 297
Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160
Government Insurance Office (NSW) v Atkinson‑Leighton Joint Venture [1981] HCA 9; (1981) 146 CLR 206
IBM Australia Ltd v National Distribution Services Ltd (1991) 22 NSWLR 466
K-Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4; (2009) 237 CLR 501
Mijatovic v Legal Practitioners Complaints Committee [2008] WASCA 115; (2008) 37 WAR 149
Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 228 CLR 529
Northern Territory v Collins [2008] HCA 49; (2008) 235 CLR 619
Paharpur Cooling Towers Ltd v Paramount (WA) Ltd [2008] WASCA 110
Passlow v Butmac Pty Ltd [2012] NSWSC 225
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
QH Tours Ltd v Ship Design and Management (Aust) Pty Ltd (1991) 33 FCR 227
R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681
Seeley International Pty Ltd v Electra Air Conditioning BV [2008] FCA 29; (2008) 246 ALR 589
South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1996) 66 SASR 509
Wealthcare Financial Planning Pty Ltd v Financial Industry Complaints Service Ltd [2009] VSC 7; (2009) 69 ACSR 418
Western Australian Planning Commission v Dungey [2010] WASC 52

BEECH J:

Introduction

The parties are in dispute in connection with a construction contract entered into between them. The dispute is being resolved by arbitration. The essential issue in this application is whether the regime for proportionate liability in pt 1F of the Civil Liability Act 2002 (WA) (the CLA) applies to commercial arbitrations.

The question referred

By definition, arbitrations occur outside the courts. The court's limited role in respect of arbitrations arises under statute. In these proceedings, the applicant, Curtin University of Technology (Curtin), invokes s 39 of the Commercial Arbitration Act 1985 (WA) (the CAA). That arose in the following circumstances.
In its points of defence in the arbitration, the respondent, Woods Bagot Pty Ltd (Woods Bagot), has invoked the proportionate liability provisions of pt 1F of the CLA, contending that there are other concurrent wrongdoers responsible for the losses of which Curtin complains, and seeking to limit Woods Bagot's liability to its proportionate share of responsibility for the losses. In reply, Curtin denies that the provisions of pt 1F of the CLA apply to the arbitration.
Curtin proposed that the question of whether pt 1F applies to the arbitration be referred to the Supreme Court under s 39 of the CAA. Woods Bagot did not consent to that proposal.
Section 39(1) provides that the Supreme Court has jurisdiction to determine a question of law arising in the course of an arbitration with the consent of the arbitrator, or with the consent of all the parties. These proceedings are founded on the consent of the arbitrator.
Prior to the hearing of these proceedings, an issue arose between the parties as to the scope and proper understanding of the arbitrator's consent. That consent to the determination of a question by the court was expressed in an unsigned document identifying the question as 'does part 1F [of the CLA] apply to these proceedings'. In its written submissions filed in advance of the hearing, Curtin contended that:
(a)on the proper construction of pt 1F of the CLA, the provisions of that part do not apply to an arbitration; and
(b)further and in any event, on a proper construction of the contract between Curtin and Woods Bagot, the contract reveals an intention to exclude proportionate liability.
In its written submissions, Woods Bagot contended that pt 1F of the CLA applies to the arbitration:
(a)by force of the legislation itself;
(b)alternatively, because of the term to be implied in the arbitration agreement that the arbitration will be conducted in accordance with the general law applicable to the subject matter in dispute;
(c)alternatively, by s 22 of the CAA, which provides that the arbitration shall be conducted according to law.
Woods Bagot contended that Curtin's second proposition was not within the scope of the arbitrator's consent. There was a similar question in respect of Wood Bagot's second contention.
After a directions hearing in these proceedings, the matter was referred to the arbitrator for clarification of his consent.
The arbitrator provided an amended direction pursuant to s 39(1)(a) of the CAA by which he consented to the determination by the Supreme Court of a question of law arising in the course of the arbitration, namely:
Does Part 1F of the Civil Liability Act 2002 (WA) apply to commercial arbitration proceedings pursuant to the [CAA]?
In the letter accompanying his amended direction, the arbitrator stated that the direction was confined to the 'pure statutory construction question' and that that may require consideration of the application of s 22 of the CAA. The letter explained the reasons why the arbitrator had not referred questions relating to contractual interpretation, implied terms and whether the parties had contracted out as permitted under s 4A of the CLA.
I interpret the question referred, consistently with the arbitrator's view, as a question of pure statutory construction. It does not encompass whether an implied term of an arbitration agreement, including that between Curtin and Woods Bagot, makes or may make pt 1F applicable to arbitration.

The requirements of s 39(2) are satisfied

Section 39(2) of the CAA requires the court to be satisfied of certain matters before it entertains a question of law referred with the consent of the arbitrator. No party raised an issue in this respect, and I am satisfied as required.
I am satisfied that the determination of this application might produce substantial savings in costs to the parties; see Mr Wilenski's affidavit of 10 July 2012 [14] ‑ [15].
I am also satisfied that the determination of the question may add substantially to the certainty of commercial law, as there is no binding authority in Western Australia or, it seems, anywhere in Australia, on the question.
It is convenient to outline the provisions of pt 1F before explaining the parties' submissions.

Part 1F of the Civil Liability Act

Section 5AI defines terms used in pt 1F as follows:
In this Part -
apportionable claim means -
(a)a claim for economic loss or damage to property in an action for damages (whether in contract, tort or otherwise) arising from a failure to take reasonable care (but not including any claim arising out of personal injury); or
(b)a claim for economic loss or damage to property in an action for damages under the Fair Trading Act 2010 based on misleading or deceptive conduct;
concurrent wrongdoer, in relation to a claim, means a person who is one of 2 or more persons whose act or omission caused, independently of each other or jointly, the damage or loss that is the subject of the claim.
Curtin emphasises the references to 'an action' in the definitions of an apportionable claim.
Section 5AJ deals with the application of pt 1F. Sub‑section (1) provides that for the purposes of pt 1F it does not matter that a concurrent wrongdoer is insolvent, is being wound up or has ceased to exist or died.
By s 5AJ(2), pt 1F does not apply, among other things, to the extent that its operation is excluded, modified or restricted in accordance with s 4A.
Section 4A provides as follows:
Limited contracting out
(1)A written agreement signed by the parties to it may contain an express provision by which a provision of Part 1A, 1B, 1C, 1D, 1E or 1F is excluded, modified or restricted and this Act does not limit or otherwise affect the operation of that express provision.
(2)Subsection (1) applies to any provision of this Act referred to in that subsection even if the provision applies to liability in contract.
Section 5AJA excludes the benefit of the proportionate liability provisions to certain types of concurrent wrongdoers including those who cause loss intentionally or fraudulently (excluded concurrent wrongdoer).
By s 5AJA(3), the liability of a concurrent wrongdoer who is not an excluded concurrent wrongdoer is to be determined in accordance with the provisions of pt 1F.
Section 5AK is the central operative provision of pt 1F. It provides as follows:
Proportionate liability for apportionable claims
(1)In any proceedings involving an apportionable claim -
(a)the liability of a defendant who is a concurrent wrongdoer in relation to that claim is limited to an amount reflecting that proportion of the damage or loss claimed that the court considers just having regard to the extent of the defendant's responsibility for the damage or loss; and
(b)the court may give judgment against the defendant for not more than that amount.
(2)If proceedings involve both an apportionable claim and a claim that is not an apportionable claim -
(a)liability for the apportionable claim is to be determined in accordance with the provisions of this Part; and
(b)liability for the other claim is to be determined in accordance with the legal rules, if any, that (apart from this Part) are relevant.
(3)In apportioning responsibility between defendants in the proceedings -
(a) the court is to exclude that proportion of the damage or loss in relation to which the plaintiff is contributorily negligent under any relevant law; and
(b)the court is to have regard to the comparative responsibility of any concurrent wrongdoer who is not a party to the proceedings.
(4)This section applies in proceedings involving an apportionable claim whether or not all concurrent wrongdoers are parties to the proceedings.
(5)A reference in this Part to a defendant in proceedings includes any person joined as a defendant or other party in the proceedings (except as a plaintiff) whether joined under this Part, under rules of court or otherwise.
Curtin emphasises the words 'court', 'judgment', 'defendant' and 'plaintiff' in this section.
Section 5AKA creates adverse costs consequences for a defendant who fails to give notice as soon as practicable to the plaintiff if the defendant has reasonable grounds to believe that another person may be a concurrent wrongdoer. The power to make such costs orders is invested in 'the court'.
Section 5AL deals with contribution and indemnity between concurrent wrongdoers. It provides:
Contribution not recoverable from defendant
(1)A defendant against whom judgment is given under this Part as a concurrent wrongdoer in relation to an apportionable claim -
(a)cannot be required to contribute to the damages or contribution recovered from another concurrent wrongdoer in respect of an apportionable claim (whether or not the damages or contribution are recovered in the same proceedings in which judgment is given against the defendant); and
(b)cannot be required to indemnify any such wrongdoer.
(2)Subsection (1) does not affect an agreement by a defendant to contribute to the damages recoverable from or to indemnify another concurrent wrongdoer in relation to an apportionable claim.
Section 5AM preserves the ability of a plaintiff to bring subsequent actions against other concurrent wrongdoers where the plaintiff has previously received 'judgment' for an apportionable part of any loss or damage.
Section 5AN deals with the joinder of concurrent wrongdoers who are not parties. It provides as follows:
Joining non‑party concurrent wrongdoers in the action
(1)The court may give leave for any one or more persons to be joined as defendants in proceedings involving an apportionable claim.
(2)The court is not to give leave for the joinder of any person who was a party to any previously concluded proceedings in respect of the apportionable claim.
Section 5AO provides that pt 1F does not prevent the vicarious liability of a person, or several liability in the case of partners, and does not affect the operation of any Act to the extent that it imposes several liability.

Proper construction of pt 1F: the parties' submissions

Curtin's submissions on why pt 1F should be construed as not applying to arbitrations may be summarised as follows:
(1)the language of the provisions, particularly the numerous references to 'court', 'action', 'proceedings', 'judgment', 'plaintiff' and 'defendant', does not naturally encompass arbitrations;
(2)there is no provision expressly extending the operation of pt 1F to arbitrations. That may be contrasted with other Western Australian legislation, including the partly cognate provisions of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (WA);
(3)an integral part of the scheme of pt 1F is the power of the court to allow joinder of other concurrent wrongdoers. An arbitrator has no power to join other wrongdoers (absent their agreement). That explains why Parliament chose not to apply the proportionate liability provisions to arbitrations, since other concurrent wrongdoers would not be bound by the award in the arbitration;
(4)although there is no binding authority, discussion in the case law in other States and academic commentary supports this construction; and
(5)the absence of reference to arbitrations in the Explanatory Memorandum and second reading speech also supports this construction.
Woods Bagot's submissions to the contrary are, in summary:
(1)part 1F involved a major reform of substantive liability law: the replacement of joint and several liability with proportionate liability. The primary policy reason was to decrease the burden of insurance premiums, and improve insurance availability, especially in the area of professional liability;
(2)this substantive reform is focused on the nature of the claims (apportionable claims) and the character of persons as concurrent wrongdoers. It is not focused on, or affected by, who is determining the claim;
(3)the policy of the reform constituted by pt 1F applies equally to a claim in an arbitration as a claim pursued by action in a court. That policy would be defeated if claims in arbitrations were excluded;
(4)the absence of mention of arbitrations in the extrinsic materials does not support Curtin's construction. Rather, it is explicable by the matters outlined in (1) ‑ (3) above. The absence of mention of arbitrations reveals that apportionable claims in arbitrations, like in courts, are to be determined in accordance with pt 1F;
(5)in order to ensure the legislation achieves its evident object, there is room for reading words like 'court', 'action', and others relied on by Curtin other than in accordance with their primary or natural meaning;
(6)in any event, these words can be read so as to extend to arbitrations;
(7)the power to join is not an essential feature of pt 1F. The legislative scheme contemplates that multiple proceedings against various concurrent wrongdoers may be necessary; and
(8)the decisions in other States concern legislation in materially different terms.

Statutory construction: principles

The parties did not appear to be at issue as to the relevant principles of statutory construction. Curtin invited the application of the principles set out in Western Australian Planning Commission v Dungey [2010] WASC 52 [27] ‑ [32]. Woods Bagot did not challenge that outline, but referred to some additional matters.
The starting point for the construction of a statute is the text. Statutory construction is a 'text based activity': Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 [4], [47]; Northern Territory v Collins [2008] HCA 49; (2008) 235 CLR 619 [16]. In Alcan Hayne, Heydon, Crennan and Kiefel JJ said the following about the task of statutory construction:
This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy [47]. (footnotes omitted)
It is well‑established that the language of the words of the statute must be interpreted having regard to their context and the legislative purpose. Context is used in a wide sense: Alcan [4]; Mijatovic v Legal Practitioners Complaints Committee [2008] WASCA 115; (2008) 37 WAR 149 [153] ‑ [155]. I repeat the statement of principles set out in Mijatovic.
In determining a question of construction of statutes, attention is to be given to considerations of context, object, and inconvenience or improbability of result.
In Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273 [11] McHugh ACJ, Gummow and Hayne JJ restated the following principles of statutory interpretation, by reference to earlier authorities:
'In Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 112, McHugh J observed:
"[A] court is permitted to have regard to the words used by the legislature in their legal and historical context and, in appropriate cases, to give them a meaning that will give effect to any purpose of the legislation that can be deduced from that context."
His Honour went on to refer to what had been said in the joint judgment in CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384. There, Brennan CJ, Dawson, Toohey and Gummow JJ said (408):
"It is well settled that at common law, apart from any reliance upon s 15AB of the Acts Interpretation Act 1901 (Cth), the court may have regard to reports of law reform bodies to ascertain the mischief which a statute is intended to cure. Moreover, the modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses 'context' in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy. Instances of general words in a statute being so constrained by their context are numerous. In particular, as McHugh JA pointed out in Isherwood v Butler Pollnow Pty Ltd (1986) 6 NSWLR 363 at 388, if the apparently plain words of a provision are read in the light of the mischief which the statute was designed to overcome and of the objects of the legislation, they may wear a very different appearance. Further, inconvenience or improbability of result may assist the court in preferring to the literal meaning an alternative construction which, by the steps identified above, is reasonably open and more closely conforms to the legislative intent. (footnotes omitted)" '
In the passage from CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408, set out above, Brennan CJ, Dawson, Toohey and Gummow JJ cited with approval the reasons of Mason and Wilson JJ in Cooper Brookes (Wollongong) Pty Ltd v FCT (1981) 147 CLR 297 at 320 ‑ 321, where their Honours said:
'If the judge applies the literal rule it is because it gives emphasis to the factor which in the particular case he thinks is decisive. When he considers that the statute admits of no reasonable alternative construction it is because (a) the language is intractable or (b) although the language is not intractable, the operation of the statute, read literally, is not such as to indicate that it could not have been intended by the legislature.
… the propriety of departing from the literal interpretation is not confined to situations described by these labels [namely absurd, extraordinary, capricious, irrational or obscure]. It extends to any situation in which for good reason the operation of the statute on a literal reading does not conform to the legislative intent as ascertained from the provisions of the statute, including the policy which may be discerned from those provisions.'

In Cooper Brookes (Wollongong) Pty Ltd v The Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 26; (1981) 147 CLR 297, Mason and Wilson JJ went on to say:
Quite obviously questions of degree arise. If the choice is between two strongly competing interpretations, as we have said, the advantage may lie with that which produces the fairer and more convenient operation so long as it conforms to the legislative intention. If, however, one interpretation has a powerful advantage in ordinary meaning and grammatical sense, it will only be displaced if its operation is perceived to be unintended (321).
Thus, where tensions arise between the natural or ordinary meaning of the words used, and the apparent object or purpose of the law, inferred from its text and from extrinsic material, questions of degree arise.
Both parties referred to and relied upon what was said by Spigelman CJ in R v Young [1999] NSWCCA 166; (1999) 46 NSWLR 681 [3] ‑ [32]. What his Honour said in that case includes the following propositions which I adopt:
(a)the task is one of construction. That involves the determination of what Parliament meant by the words it used, not what Parliament intended to say;
(b)in construing legislation as if it contained additional words, the court is construing the words actually used in the legislation in their total context; it is not altering the legislation to insert words that were omitted by inadvertence;
(c)the court must confine itself to the range of possible meanings or operation of the text and use consequences, purpose and object to determine which meaning should be selected; and
(d)the court may construe words in the statute to apply to a particular situation or to operate in a particular way even if the words would not, on a literal construction, apply or operate in that way. However, the words actually appearing in the statute must be reasonably open to such a construction. Construction must be text based.
By s 18 of the Interpretation Act 1984 (WA) a construction that would promote the purpose or object underlying a written law (whether that purpose is expressly stated in the written law or not) shall be preferred to a construction that would not promote the purpose or object. That section is not directed to a construction which better achieves the object of an Act. Rather, the section assists when there is a choice between a construction that would promote the underlying object or purpose of the Act, and one which would not: Chugg v Pacific Dunlop Ltd [1990] HCA 41; (1990) 170 CLR 249, 262. Nevertheless, as the principles set out above demonstrate, quite apart from the Interpretation Act, at common law the court has regard to the evident purpose and context, in its wide sense, when construing legislation.
A provision of a statute must be construed consistently with the language and purpose of all the provisions of the statute: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 [69].
Section 19 of the Interpretation Act identifies extrinsic material which a court may consider in order to confirm the meaning of a provision in a written law, or to determine the meaning of a provision where there is ambiguity or obscurity in its ordinary meaning. Such material includes any explanatory memorandum relating to the Bill and the second reading speech. However, secondary materials must not be substituted for the text of the legislation: K‑Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4; (2009) 237 CLR 501 [53]. The words of the statute, not non‑statutory words seeking to explain them, are of paramount significance: Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 228 CLR 529 [22]; see also [82]–[84].
Consistently with the principles I have stated, I begin by considering the text and language of pt 1F.

Textual considerations in pt 1F of the CLA

For the reasons that follow, in my opinion, the natural and ordinary meaning of the language used in pt 1F supports Curtin's construction.
The word 'court' is not defined in pt 1F. To my mind, in its natural and ordinary meaning, the word 'court' does not comfortably encompass arbitrators.
Woods Bagot's submissions refer to a number of authorities on what, in various contexts, is or may be a court. There is no authority referred to where the word 'court' is interpreted in any context to include an arbitrator, without some express words to indicate that that was intended.
In Alliance Petroleum Australia NL v Australian Gas Light Co (1983) 34 SASR 215, 236, King CJ held that arbitration was 'civil proceedings' for the purposes of the Service and Execution of Process Act 1992 (Cth). However, as is properly pointed out in Woods Bagot's submissions, that statutory setting did not require that the proceedings be in or of a court.
Woods Bagot emphasises that the word 'court' only appears in two sections of pt 1F: s 5AK and s 5AN. However, to my mind, its location in s 5AK is significant. Section 5AK is the substantive operative provision that stipulates when, and in what circumstances, proportionate liability is to be imposed. Moreover, by s 5AK(1) proportionate liability is created only in respect of proceedings involving an apportionable claim. That term is defined by reference to certain types of 'actions for damages'. A claim made in an arbitration may be capable of being characterised, for some purposes, as an 'action for damages', but, to my mind, the more natural reading of an 'action for damages' does not encompass a claim in an arbitration.
The other section in which the word 'court' is used is s 5AN. That section gives a court a power to join other persons as defendants in proceedings involving an apportionable claim. I will say more about the significance of s 5AN later in these reasons. In summary, I consider it an important part of the scheme created by pt 1F, although it is clear that the proportionate liability regime created by pt 1F operates notwithstanding that, in some cases, concurrent wrongdoers will not and cannot be joined as defendants.
An arbitrator does not have power to join parties, other than by their consent. Thus it is clear that the reference to 'court' in s 5AN does not encompass an arbitrator. I accept Woods Bagot's submission that the meaning of 'court' in s 5AN is not determinative of the meaning of the same word when it appears in s 5AK. However, the natural starting point is that the same word when used in different sections within one part of legislation is intended to mean the same thing. The question is whether considerations of context, object and purpose or consequences warrant a departure from that starting point.
Woods Bagot also submits that Passlow v Butmac Pty Ltd [2012] NSWSC 225 [33] ‑ [41] demonstrates that use in legislation of the term 'court' does not prevent the Act applying to arbitrations (submissions [73]). In Passlow the legislation (the Trade Practices Act 1974 (Cth)) was not construed as applying of its own force to arbitration. Rather, it became applicable by operation of an implied term of the arbitration agreement. I will say more about this later in these reasons.
As I have said, in various sections in pt 1F the words 'judgment' 'plaintiff' and 'defendant' are used. Although it seems to me to be of less weight than the references to 'court' and 'actions for damages', I think that 'judgment' does not naturally encompass an award by an arbitrator. I do not give any weight to the words 'plaintiff' and 'defendant' for present purposes.
For these reasons, I consider the natural and ordinary meaning of the language of pt 1F as a whole supports Curtin's construction. In a sense, this was implicitly accepted by senior counsel for Woods Bagot. In oral argument, he framed the critical question as being whether the word court could 'bear' inclusion of an arbitrator. He accepted that that might not be the natural starting point for the meaning of the word 'court', but said that it was justified by the object and purpose of the legislation (ts 45 ‑ 49), to which I now turn.

The purpose and object of pt 1F

The background to the introduction of the proportionate liability legislation was explained by Finkelstein J in BHPB Freight Pty Ltd v Cosco Oceania Chartering Pty Ltd (No 2) [2008] FCA 1656 as follows:
Proportionate liability was introduced into state and federal legislation following an inquiry into the law of joint and several liability established by the Commonwealth and the New South Wales Attorneys‑General in 1994. The impetus for the inquiry was the growing number of actions against professionals, particularly auditors, who were being singled out as targets for negligence actions not because of their culpability (which might be small) but because they were insured and had the capacity to pay large damages awards. One consequence was a sharp rise in insurance premiums payable by professionals. The inquiry was conducted by Professor Davis of the Australian National University. He published stage one of his report in July 1994 and stage two in January 1995. In his report Professor Davis recommended that joint and several liability for negligence which causes property damage or economic loss be replaced by liability which is proportionate to each defendant’s degree of fault.
Draft model provisions that reflected the recommendation of the enquiry were published in July 1996 in the form of a part that could be inserted in appropriate legislation. The Commonwealth, State and Territory governments agreed to amend relevant legislation, based on the draft model provisions, to facilitate the introduction of a nationally consistent proportionate liability regime in respect of claims for economic loss or property damage. To implement its part of the agreement the Commonwealth amended the Australian Securities and Investments Commission Act 2001 (Cth), the Corporations Act 2001 (Cth) and the Trade Practices Act so that proportionate liability applied to claims for damages for economic loss or property damage arising from misleading or deceptive conduct. By amendments to the Wrongs Act, Victoria introduced proportionate liability in respect of claims for economic loss or property damage arising from a failure to take reasonable care [4] ‑ [5].
That passage has been adopted as an accurate statement of the background to this legislation in subsequent cases: Aquagenics Pty Ltd v Break O'Day Council [2010] TASFC 3 [10]; Bennett v Elysium Noosa Pty Ltd (in liq) [2012] FCA 211; (2012) 202 FCR 72 [272]. I also adopt it. It is supported by consideration of the extrinsic materials, and is consistent with the text of the legislation.
The Minister's second reading speech in introducing the Civil Liability Amendment Bill 2003 (WA) included the following:
The escalation of insurance premiums and the complete withdrawal of insurance products in many sectors have required the Government to step in and take affirmative action by developing an insurance relief package. However, rather than simply subsidise the cost of the premiums, the response needed is one that goes to the heart of the problem; that is, to the legal framework and community attitudes.
In November last year, the Premier gave a commitment to introduce a second tranche of legislation following consideration of the review of the law of negligence and assessment of additional actuarial reports on the insurance market in order to fully respond to the insurance crisis being experienced by businesses, community groups, volunteers and the end user; namely, the consumer.
...
This Government has committed to responding to the needs of community groups and businesses and, in particular, recreational service sector providers. The Australian society of Certified Practising Accountants, CPA Australia, found from a survey of small businesses conducted in August 2002 that insurance costs ranked as two of the top five risks posed to small businesses. The lack of insurance cover was the top concern, rated by 71 per cent of those surveyed. The first of two significant provisions that will benefit all businesses and community organisations is the introduction of proportionate liability to replace the concept of joint and several liability. This will apply only to pure economic loss and not personal injury claims. This means that a defendant, if jointly responsible for economic loss or property damage with some other person or persons, will be liable only to pay compensation to the victim for the amount for which the defendant is responsible. This will be particularly good news for auditors, accountants, engineers and other professionals who struggle to secure affordable professional indemnity insurance due to the unlimited exposure of the current system that makes the professional indemnity a very high risk class (Western Australia, Parliamentary Debates, Legislative Assembly, 20 March 2003, 5691 ‑ 5692, (Mr M McGowan, Parliamentary Secretary)).
In introducing the Civil Liability Amendment Bill 2004 (WA), the Minister's second reading speech including the following:
The amendments make three main changes. The first deals with a technical issue which could, if not addressed, result in proportionate liability not applying to certain concurrent wrongdoers because different causes of action are involved. In order to expand the range of cases to which proportionate liability will apply, proportionate liability is now to apply when the plaintiff's loss is caused by two or more concurrent wrongdoers each - or some - of whom are liable by reason of the same or different causes of action. The amendment will remove the prerequisite that all concurrent wrongdoers be liable by reason of the same cause of action.
...
Thirdly, a procedural change is proposed whereby defendants to a claim will be obliged to inform plaintiffs of other concurrent wrongdoers known to the defendants. The Civil Liability Act leaves the onus on the plaintiff to join all relevant parties. This assumes that a plaintiff will be able to investigate all transactions. Under 'joint and several' liability this did not raise any great concern, as the plaintiff could selectively target its investigations, forcing a well‑funded defendant to makes its own investigations into other relevant parties. The change to proportionate liability affects this power. The amendments will provide that a defendant to a claim to which proportionate liability could apply will be obliged to notify the plaintiff in writing, at the earliest possible time, of the identity and alleged role of any other person/s of whom the defendant is aware who could be held liable for the plaintiff's loss or any part of it. When a defendant fails to discharge the disclosure obligation, the court will have a discretion to order that the defendant pay any or all of the plaintiff's costs, on an indemnity basis or otherwise (Western Australia, Parliamentary Debates, Legislative Assembly, 22 June 2004, p 3986b ‑ 3988a).
It is evident that a central policy reason behind the proportionate liability legislation is to decrease the burden of insurance premiums, especially on professionals. Further, this legislative change aims to deal with what has been referred to as 'deep pocket syndrome' by which a solvent or insured defendant would bear a disproportionate amount of joint liability between multiple defendants, or where the claimant selects a single or small number of parties as defendants regardless of the relative responsibility of multiple wrongdoers (see the Explanatory Memorandum for the Civil Liability Bill 2002 (WA)).
Woods Bagot submits that:
(a)these purposes are furthered by construing pt 1F as applying to arbitration;
(b)the policy of that reform applies equally to a claim in arbitration as to a claim pursued by action in a court;
(c)the application of proportionate liability depends on the nature of the claim, not the character of the decision maker;
(d)the policy of the law would be defeated if claims in arbitrations were excluded; and
(e)in this light any failure to address arbitrations, in the context of the purpose of the legislation 'could not have been deliberate' (submissions [58]).
The need to ensure the achievement of the object of the legislation is the central reason why, Woods Bagot submits, the language of pt 1F should be construed so as to extend to arbitrations.
It is convenient to say something about the nature of arbitrations, and the law applicable to them, before returning to these matters.

The nature of arbitrations and the law applicable in an arbitration

An arbitration under the CAA arises through the agreement of parties to refer present or future disputes to arbitration. In that way, arbitration is a voluntary process. By definition, the same is not true of curial processes.
If a party to an arbitration agreement makes a claim against the other party to the arbitration agreement and the same or closely related claim against a person who is not a party to the arbitration agreement, the dispute as to the latter party cannot be referred to arbitration (unless that party consents): Paharpur Cooling Towers Ltd v Paramount (WA) Ltd [2008] WASCA 110 [43].
Subject to the CAA, and to the arbitration agreement, the arbitrator can conduct arbitral proceedings in such manner as the arbitrator thinks fit: CAA s 14.
Section 22(1) of the CAA provides as follows:
Unless otherwise agreed in writing by the parties to the arbitration agreement, any question that arises for determination in the course of proceedings under the agreement shall be determined according to law.
The parties made submissions on the effect of the command in s 22 that questions in arbitration be determined 'according to law'. Wood Bagot's submissions also raise a question of whether s 22 operates to apply pt 1F in an arbitration, as part of deciding the arbitration according to law, notwithstanding that, on a proper construction, pt 1F does not apply, of its own force, in arbitral proceedings.
In South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1996) 66 SASR 509, 512. Matheson J held (Bollen and Millhouse JJ agreeing) that the words 'according to law' in s 22 mean according to the principles of common law.
The CAA is part of uniform legislation throughout Australia. I should not depart from any interpretation of such legislation by an Australian intermediate appellate court unless convinced that that interpretation is plainly wrong: Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485, 492.
Although senior counsel for Woods Bagot did not accept the correctness of the decision in Leighton Contractors, he did not develop submissions in support of the contention that I should be satisfied that it is plainly wrong. Counsel did not point to any case which has challenged what was said in the Full Court of the Supreme Court of South Australia. In 620 Collins Street Pty Ltd v Abigroup Contractors Pty Ltd (No 3) [2006] VSC 492 [37] Osborn J referred to what was said in Leighton Contractors. His Honour decided the issue before him about the proper construction of legislation dealing with costs. He then observed that 'this is not to say that the phrase "according to law" is necessarily to be limited to the meaning of "according to the principles of common law" as stated in the [Leighton Contractors] case'. While that way of expressing things may reveal some doubts, it falls well short of providing a firm foundation for concluding that what was said in the Leighton Contractors case is plainly wrong.
Further, counsel has not referred to, and I have not indentified, any case in which the exercise by arbitrators of powers under statute has been said to be founded on s 22. Rather, where that has arisen, for example in the context of the Trade Practices Act 1974 (Cth), it has been said to be grounded in an implied term of the arbitration agreement. I will deal with those cases shortly.

Without the benefit of authority, as a matter of first impression, I would not have read the words 'according to law' in s 22 as being limited to principles of common law, as that might appear to be a gloss on the words of the statute. However, in the absence of detailed submissions I am not persuaded that the decision of the statement of the South Australian Full Court is plainly wrong.
Consequently, I follow the approach in Leighton Contractors.
There are many cases in which it is said that an arbitrator has an implied power, arising as an implication in the arbitration agreement, to determine the arbitration in accordance with the general law applicable to the subject matter in dispute and to give to the claimant such relief as would be available in a court of law having jurisdiction with respect to the subject matter of the dispute. I refer to a number of authorities immediately below.
In Government Insurance Office (NSW) v Atkinson‑Leighton Joint Venture [1981] HCA 9; (1981) 146 CLR 206 a majority of the High Court held that an arbitrator had power to award interest on amounts found by him to be due by reference to the New South Wales equivalent of s 32 of the Supreme Court Act 1935 (WA). Mason J described the real question as whether there was to be implied in the parties' submission to arbitration a term that the arbitrator is to have authority to give the claimant such relief as would be available to him in a court of law having jurisdiction with respect to the subject matter (246). In my view, what was said by Stephen J at 234 ‑ 235 is to the same effect, and is founded on an implied term of the arbitration agreement.
Senior counsel for Curtin submits that this principle is restricted to matters like costs and interest, which are ancillary to the primary rights, and does not extend to matters going to the primary rights (ts 34). I do not accept that submission. It is not consistent with the application, including in the cases referred to below, of the principle to claims under the Trade Practices Act.
In IBM Australia Ltd v National Distribution Services Ltd (1991) 22 NSWLR 466, the arbitration agreement in question applied to 'any controversy or claim arising out of or related to this agreement or the breach thereof'. In the arbitration, the claimant made claims for relief under the Trade Practices Act for misleading or deceptive conduct on the part of the respondent. The issue in the appeal was whether the claim under the Trade Practices Act was part of what was referred to arbitration under the arbitration agreement.
Kirby P applied the reasoning of Mason and Stephen JJ in GIO (NSW) v Atkinson‑Leighton. His Honour rejected an argument that the width of the relief available under the Trade Practices Act militated against imputing to the parties the intention to provide all of the relief of the kind afforded to courts by that Act. He observed that it was sufficient to answer that argument by saying that the decision in GIO (NSW) v Atkinson‑Leighton contemplates that the very purpose of a reference to arbitration will frequently be to confer on the arbitrator the powers which would be enjoyed, even by statute only, by the court of law of competent jurisdiction that would otherwise hear the case (480). A little later, his Honour concluded that GIO (NSW) v Atkinson‑Leighton bound the court to conclude that the submission to arbitration was intended to give the arbitrator authority to provide the claimant with the relief available to it in a court of law of competent jurisdiction and that was so even though such relief was based only on statute (481). Kirby P explained that the case before him concerned the scope of the authority of the arbitrator, rather than the way in which the arbitrator's authority was to be exercised. The latter question had not yet arisen (481). Clarke JA also referred to GIO (NSW) v Atkinson‑Leighton. He said that upon the application of the principle in that case, it should be implied that the parties authorised the arbitrator to grant such relief as would be available in a court of law having jurisdiction with respect to the subject matter, including relief under s 82 and s 87 of the Trade Practices Act (485 ‑ 486).
In QH Tours Ltd v Ship Design and Management (Aust) Pty Ltd (1991) 33 FCR 227, Foster J held that an arbitrator is not prevented by any rule of law from deciding whether the contract in which the arbitration clause appointing him as arbitrator is found is void. In that case, the claim that the contract was void was made as part of alternative relief claimed in respect of misleading and deceptive conduct under the Trade Practices Act.
Foster J analysed the decision in IBM to which I have already referred. His Honour then focused on the real issue before him, namely whether there was an impediment to an arbitrator having power to declare the agreement under which he was appointed arbitrator as void. He answered that question in the negative (240). Woods Bagot submits that what Foster J said there is not put in terms of an implied term. To my mind, that is not significant for present purposes, given the question which was before Foster J.
In Francis Travel Marketing Pty Ltd v Virgin Atlantic Airways Ltd (1996) 39 NSWLR 160, the main issue was whether the claim made was one that gave rise to a dispute or difference 'arising out of' the agreement in question. The claim was to the effect that a purported termination of the agency agreement between the parties was wrongful, taking into account what had been represented during the course of the agreement, involving misleading conduct in contravention of the Trade Practices Act, estoppel and other complaints. That claim included a claim for relief under s 87 of the Trade Practices Act. Gleeson CJ said that it had been decided in the IBM case first that it is possible and lawful for parties to agree to refer to arbitration a dispute under the Trade Practices Act, secondly that an arbitrator to whom such a dispute has been referred may, in general, exercise the discretionary powers which the Act confers upon the Supreme Court or the Federal Court and, thirdly, there was no reason to read down an otherwise comprehensive arbitration agreement in order to avoid a conclusion that this is what the parties had agreed to do (166).
Gleeson CJ stated that it would be for the arbitrator to decide, applying relevant principles of conflict of laws, what part the allegation of a contravention of s 52 of the Trade Practices Act and the claim to relief under s 87 would play in the arbitration, given that the arbitration was to be conducted in London. It was not for the court to pre‑empt that decision. Applying GIO (NSW) v Atkinson‑Leighton, Gleeson CJ said that the central question, to be resolved affirmatively, was whether there was to be implied in the parties' submission to arbitration, a term that the arbitrator is to have the authority to give the claimant such relief as would be available to him in a court of law having jurisdiction with respect to the subject matter (167).
In Comandate Marine Corp v Pan Australia Shipping Pty Ltd [2006] FCAFC 192; (2006) 157 FCR 45 [241] Allsop J (Finn J [6] ‑ [7] and Finkelstein J [9] agreeing) applied what had been said by Gleeson CJ (as summarised in the preceding paragraph) in Francis Travel (167). Allsop J referred to the term that 'may be seen to be implied in the arbitration agreement' that the arbitrator is to have the authority to give the claimant such relief as would be available to it in a court of law having jurisdiction with respect to the subject matter. See also, Seeley International Pty Ltd v Electra Air Conditioning BV [2008] FCA 29; (2008) 246 ALR 589 [27], and Passlow v Butmac Pty Ltd [2012] NSWSC 225 [40]. In the latter case Hanson J said that includes powers conferred on a court under s 80 and s 87 of the Trade Practices Act [42].

Analysis and conclusion on the proper construction on pt 1F

It follows from my acceptance of the view espoused by the South Australian Full Court in Leighton Contractors (that 'according to law' means according to common law principles) that s 22 of the CAA cannot, of itself, make pt 1F of the CLA applicable to an arbitration.
The authorities referred to in the previous section of these reasons support the view that a term is generally implied into arbitration agreements that the arbitration be conducted in accordance with the law applicable to the subject matter in dispute, with the arbitrator having the authority to give the claimant such relief as would be available in a court of law having jurisdiction with respect to the subject matter. Arguably at least, depending on and subject to the terms of the arbitration agreement, that implied term may make the proportionate liability regime in pt 1F of the CLA applicable to an arbitration. On that basis, to the extent that the purpose of pt 1F is advanced by applying proportionate liability to an arbitration, that is achieved through an implied term of the arbitration agreement, so long as that is consistent with the intention of the parties as expressed in the arbitration agreement. It would not be necessary to read the words of the legislation in an unnatural and extended way to achieve that outcome.
I emphasise that whether there is any such implied term in this case is a matter on which I express no opinion. That will depend on the proper construction of the contract, and is a matter for the arbitrator.
Further, and in any event, the inability of an arbitrator to join a party (other than by agreement) seems to me to be a weighty consideration militating against the construction invited by Woods Bagot. I accept, as Woods Bagot emphasises, that the proportionate liability regime created by pt 1F is not limited in its operation to situations where all wrongdoers are parties. To the contrary, it is clear that pt 1F contemplates and expressly provides that liability will be proportionate in some circumstances when not all of the wrongdoers are parties. That is expressly provided by s 5AK(4). See also s 5AK(3)(b), s 5AJ(1) and s 5AM(1). Nevertheless, the existence of a power on the part of the court, conferred by s 5AN, seems to me to be an integral part of the scheme of pt 1F. It is one thing to decide to impose proportionate liability upon a plaintiff in the framework where the court has power to join other concurrent wrongdoers. To impose proportionate liability in the absence of such a power is a quite different thing. The absence of a power to join other wrongdoers has the prospect that a proportionate liability regime may cause injustice or hardship to a claimant.
Because an arbitrator has no power to join other concurrent wrongdoers, a claimant would be obliged to commence subsequent court proceedings against other concurrent wrongdoers on account of whose responsibility the claimant's loss and damage had been reduced in arbitration. Obviously, the court would not be bound by, or even influenced by, the arbitrator's findings on the conduct and responsibility of those other concurrent wrongdoers. Consequently, the claimant would face the risk of a conflicting judgment from a court in the subsequent proceedings.
Section 5AKA imposes adverse costs orders against a defendant who fails to give notice to the plaintiff that another person may be a concurrent wrongdoer. The evident purpose of that provision is to facilitate the joinder of such other concurrent wrongdoer by the plaintiff, should the plaintiff so desire. See the second reading speech for the Civil Liability Amendment Bill 2004 (WA), 6 April 2004 (1745a) where it was said that the CLA puts the onus on the plaintiff to join all relevant parties.
It is true, as Woods Bagot submits, that an arbitrator has a power to consolidate arbitration proceedings under s 26 of the CAA. However, that does not detract from the significance of the absence of a power to join. The power to consolidate will only arise if the other concurrent wrongdoer is party to an arbitration agreement, and if a party to that agreement has initiated an arbitration.
The absence of power for an arbitrator to join a concurrent wrongdoer provides a plausible reason why Parliament might have chosen, in the sphere of disputes determined by arbitration, not to advance its purpose of imposing proportionate liability.
For the reasons I have given, I am not satisfied that there is any sufficient justification to depart from the ordinary meaning of the language of pt 1F. As I have said, that ordinary meaning favours Curtin's construction, which I would adopt.
There are further considerations which reinforce this conclusion.
Curtin points to a number of Acts in which the legislature makes express reference to arbitration contending that that supports the conclusion that Parliament deliberately refrained from extending pt 1F to arbitrations. With one exception, the definitions and references in other legislation do not seem to me to be of assistance in the proper construction of pt 1F of the CLA. The exception is the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (the 1947 Act). The subject matter of that legislation overlaps with the subject matter of pt 1F. Part 1F qualifies some of the operation of the 1947 Act. Section 7(1) of the 1947 Act was amended, when pt 1F was inserted, so as to be expressed to be subject to pt 1F of the CLA. Section 3 of the 1947 Act expressly states that 'action includes an arbitration' and 'court includes an arbitrator'. Like Evans J [32] and Tennent J [98] in Aquagenics, I am of the view that, in that framework it might be thought that had Parliament intended pt 1F to apply to arbitrations, explicit definitions for the words 'action' and 'court' along the lines of those contained in the 1947 Act would have been included in pt 1F of the CLA.
Finally, although the legislation is not identical, obiter comments from other superior courts in Australia support the construction which I have adopted. In Aquagenics the Full Court decided that on a proper construction of the arbitration agreement, the proportionate liability legislation of Tasmania was excluded. Therefore the court did not have to decide whether that legislation applies, on its proper construction, to arbitrations generally. Nonetheless, all members of the court favoured the construction that the legislation does not, by force of its provisions, apply, although Evans J, with whom Wood J agreed, did not express a final view on the point (see [26] ‑ [34] and [95] ‑ [98]). As can be seen, some of the reasons I have given echo observations made by their Honours. In taking into account the Aquagenics case, I do not overlook that in the Tasmanian legislation, unlike the Western Australian legislation, the word 'court' was defined.
Wealthcare Financial Planning Pty Ltd v Financial Industry Complaints Service Ltd [2009] VSC 7; (2009) 69 ACSR 418 dealt with whether the Financial Industry Complaints Service was required to have regard to the proportionate liability regime found in pt IVAA of the Wrongs Act 1958 (Vic). Cavenough J held it did not [37] ‑ [38]. His Honour expressly refrained from deciding the question of whether the legislation applied to commercial arbitrations. Nevertheless his reasoning is consistent with, and in some respects supportive of, the reasons I have given for the construction I have adopted.
Woods Bagot relies on s 4A of the CLA in support of its construction. That section provides that a written agreement signed by the parties may contain an express provision by which a provision of, among others, pt 1F is excluded, modified or restricted. Woods Bagot submits that the requirement of an express provision to that effect is undermined by construing pt 1F as not applying to disputes determined by arbitration. I am not persuaded that that submission sustains acceptance of Woods Bagot's construction. First, s 4A is a facilitative provision. To my mind, it does not carry significant weight in determining the scope of application of pt 1F. Secondly, and in any event, to the extent that an implied term in an arbitration makes pt 1F applicable in the arbitration, the premise for Woods Bagot's argument will not exist. The choice of arbitration will not of itself have excluded the application of pt 1F.

Conclusion

In summary, the following considerations lead me to adopt Curtin's construction.
(1)The natural meaning of the language 'court' and 'action for damages' and to a lesser extent 'judgment' favours Curtin's construction.
(2)The word 'court' in s 5AN does not extend to an arbitrator. The starting point is that 'court' in s 5AK has the same meaning.
(3)The absence of a power of an arbitrator to join other concurrent wrongdoers may explain why the proportionate liability regime is not applied to arbitrators.
(4)To the extent that Parliament's purpose in enacting pt 1F is advanced by applying it to an arbitration, that may be achieved through an implied term in the arbitration agreement, subject to the terms of the agreement. Thus it is not necessary to give the language of pt 1F an extended meaning to achieve this purpose.
(5)Unlike the partly cognate provisions of the 1947 Act, nothing in pt 1F refers to arbitrations.
I would answer the question posed 'no'. As will be apparent from what I have written, that is a negative answer to the statutory construction question. It does not deal with whether pt 1F of the CLA applies to this arbitration, or any particular arbitration, by virtue of an implied (or express) term of the arbitration agreement.
I will hear from the parties as to costs.