Daniels v Tasmanian Health Service
[2016] TASSC 27
•10 June 2016
[2016] TASSC 27
COURT: SUPREME COURT OF TASMANIA
CITATION: Daniels v Tasmanian Health Service [2016] TASSC 27
PARTIES: DANIELS, Bindy-Ann
v
TASMANIAN HEALTH SERVICE
RAYMOND, Dr Steven
ZITO, Dr Adele
BAYER HEALTHCARE PHARMACEUTICALS INC
FILE NO: 1301/2015
DELIVERED ON: 10 June 2016
DELIVERED AT: Hobart
HEARING DATES: 23 & 27 May 2016 (written submissions 8 & 10 June 2016)
JUDGMENT OF: Holt AsJ
CATCHWORDS:
Private International Law – Service out of jurisdiction – Under other legislation and Rules of Court – Procedure – Conditional appearance and setting aside service – Application to set aside service – Onus of proof – Onus on plaintiff to show service permitted without leave – Onus on defendant on other matters.
Supreme Court Rules 2000 (Tas), r 168.
Forestry Commission v Vickers-Armstrong (Tractors) Ltd (1964) Tas SR 109 considered.
Aust Dig Private International Law [1087]
Procedure – Civil Procedure in State and Territory Courts – Commencing proceedings – Time for service of originating process and renewal – Calculation of period during which writ in force for service – Exclusion of certain days.
Supreme Court Rules 2000 (Tas), r 48.
Aust Dig Procedure [1123]
Procedure – Civil Procedure in State and Territory Courts – Commencing proceedings – Time for service of originating process and renewal – Writ delivered after ceasing to be in force – Renewal order – Correct irregularity so that writ taken to have been served when first delivered.
Supreme Court Rules 2000 (Tas), r 107.
Aust Dig Procedure [1123]
REPRESENTATION:
Counsel:
Plaintiff: P Jackson SC
Fourth defendant: B McTaggart SC
Solicitors:
Plaintiff: Tasmanian Compensation Lawyers
Fourth defendant: Baker & McKenzie
Judgment Number: [2016] TASSC 27
Number of paragraphs: 49
Serial No 27/2016
File No 1301/2015
BINDY-ANN DANIELS v TASMANIAN HEALTH SERVICE,
DR STEVEN RAYMOND, DR ADELE ZITO and
BAYER HEALTHCARE PHARMACEUTICALS INC
REASONS FOR JUDGMENT HOLT AsJ
10 June 2016
Introduction
The plaintiff issued her writ, which included a claim against Bayer Healthcare Pharmaceuticals Inc, on 19 August 2015. On 22 February 2016 a process server attended Bayer's premises in the State of New Jersey in the United States of America. The process server handed the writ and some associated documents to an administrative assistant, Maria Nudelman, at the premises. Ms Nudelman showed the writ to a Bayer in-house lawyer, Mr Richard Liner. Ms Nudelman took a photocopy of the documentation and then she and Mr Liner returned to the process server and Mr Liner advised that the process would not be accepted as Bayer did not accept service of international documents. The originals were returned to the process server who took the documents away with him.
On 6 April Bayer, through its Australian solicitors, filed a notice of conditional appearance disputing the validity of the service of the originating process and reserving its right to apply for an order setting aside service. At the same time Bayer filed an application seeking an order setting aside service and, in the event that service is set aside and the writ not renewed, an order setting aside the writ itself. On 20 April the plaintiff filed an application seeking an order that the writ be renewed. The applications were heard together.
Bayer contends that the evidence does not show that what occurred at Bayer's premises on 22 February 2016 constituted service of the originating process.
The Supreme Court Rules 2000, r 147A(1)(g) permits service outside Australia where there are other defendants to be served in Tasmania. Bayer asserts that the plaintiff, who relies on r 147A(1)(g), must show that Bayer is "a necessary or proper" party to an action "properly" brought against a defendant served or to be served within the jurisdiction. Accordingly, Bayer further submits that as neither the endorsement of claim on the writ nor the evidence shows that these asserted requirements are satisfied service should be set aside.
I will deal firstly with the question whether or not the method of service was valid. In dealing with the question I need to consider the following matters:
·Private international law as to the service of Australian court documents in the United States of America.
·The domestic law of the State of New Jersey relied upon regarding effecting service on a corporation.
·The Supreme Court Rules regarding service outside Australia and proof of service.
·The application of the law and rules to what occurred at Bayer's premises on 22 February 2016.
I will deal secondly with the question of whether or not the writ was in force (and so effective for service) on 22 February 2016. In dealing with the question I will need to consider the following matter:
·Whether the six month period fixed by r 107 as the period during which a writ, which has not been renewed, remains in force is calculated having regard to r 48 which provides that any period appointed by the rules does not include the period between 23 December and 7 January, unless the Court otherwise directs.
I will deal thirdly with the question of whether r 147A(1)(g) contains an implied requirement that an overseas defendant be a "necessary or proper" party to proceedings "properly" brought against a co-defendant served, or proposed to be served, within the jurisdiction.
I will deal fourthly with the question of whether or not the writ should be renewed. In dealing with this question (if the method of service was effective but the writ had ceased to be in force) I will consider the following matter:
·Whether renewal will operate to make service on 22 February effective having regard to r 107(6), which provides that a renewed writ is in force from the date of issue of the original writ.
I will deal fifthly with the question of what orders should be made on the respective applications having regard to my conclusions on the matters set out above. In the event that I determine that the method of service was valid, but at the time the writ was not in force, and that renewal is appropriate, I will need to consider the following matter:
·Whether an order should be made setting aside service or whether the set aside service application should be dismissed, if the irregularity is cured by the renewal so that, absent an order to the contrary, the conditional appearance will, pursuant to r 168(5), become unconditional and hence a submission to the jurisdiction of the Court.
Lastly, in the event that the application to set aside service is dismissed, I will consider whether the conditional appearance should be allowed to become unconditional.
The Hague Convention
Australia and the United States of America are signatories to the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters. The convention includes the following:
·The convention applies to the service abroad of court documents in civil matters in signatory countries (Article 1).
·The signatories each designate a central authority to receive requests for the service of documents (Article 2).
·An authority or judicial officer from the country of origin may forward a request for service to the central authority of the country in which service is intended to occur (Article 3).
·The central authority for the country in which service is to occur is to serve, or arrange to have served, the documents in accordance with the internal law of the locality for the service of documents in domestic actions or alternatively in accordance with a method requested by the applicant, if such method is not inconsistent with the internal law of the locality of the place in which service is to occur (Article 5).
·The central authority, or any authority which it has designated for the purpose, is to complete a certificate in the form prescribed by the Convention. The certificate is to state the method, the place, the date of service and the name of the person to whom the document was delivered. Alternatively, if service was not effected, the certificate is to state the reasons which prevented service (Article 6).
·Provided that the country in which service is to occur has not objected, the Convention does not interfere with service by post where such a method of service is available. (For example, service on a corporation) (Article 10).
·If a certificate has issued, default judgment can be entered against a defendant only if it is established that the method of service was in accordance with the internal law of the locality where service occurred and that service was effected in sufficient time to enable the defendant to defend. Each signatory state is free to establish other procedures for obtaining default judgment in cases where not less than six months have passed since transmission of the service documents to the central authority abroad and despite every reasonable effort having been made to obtain a certificate no certificate of any kind has been obtained (Article 15).
The internal law of the State of New Jersey as to the service of documents on a corporation
The New Jersey Court Rules 1969 apply to the service of documents in the State of New Jersey in domestic actions. Rule 4:4-4(a)(6) relevantly provides that service may be effected on a corporation by service on a person authorised by appointment or by law to receive service on behalf of the corporation.
The Rules of Court
The Supreme Court Civil Procedure Act 1932, s 197(2) provides:
"In any case in which any process of any kind whatsoever which has been –
(a) issued out of, filed in, or extracted from the Court in any proceeding which is subject to the provisions of this Act (whether the process was issued, filed, or extracted for the purpose of instituting, or in the course of, the proceeding); or
(b) granted by the Court or a judge thereof in the exercise of any part of the jurisdiction of the Court which is subject to this Act –
and is served out of the jurisdiction of the Court in accordance with the Rules of Court, such service shall (subject to the Rules of Court) have the same effect and operation with respect to subsequent proceedings in the original proceeding or matter in which the same was issued, filed, extracted, or granted as it would have had if the person on whom it was served had at the time of the service thereof been in this State."
The Supreme Court Rules 2000 include the following:
·Originating process may be served outside Australia without leave in certain cases, including if a person to be served abroad is joined as a party to proceedings that are brought against another person served, or to be served, in Tasmania (r 147A).
·Where a defendant, served outside Australia, does not appear the plaintiff cannot proceed against the defendant, by applying for default judgment or otherwise, without first obtaining the leave of the Court (r 147B).
·On an application for leave, the Court will consider whether the subject matter of the proceeding falls within r 147A. This determination is made by reference to the contents of the process where necessary supplemented by evidence. Demonstration that the claim falls within r 147A and proof of service (r 147B) produces the result that the Court's jurisdiction is, prima facie, properly invoked. Agar v Hyde (2000) HCA 41 at [52 and 54]; (2000) 201 CLR 552 at 574-575 [52 and 54].
·On an application by an overseas defendant to set aside service (r 167 or r 168(4)), it must firstly be determined whether or not the matter falls within r 147A on a consideration of the form of the process. If the claim, as expressed in the originating process, is found to fall within r 147A, it is for the defendant opposing leave or seeking to have set aside the process or its service to show that, despite the form of the process, the claim, in reality, does not fall within r 147A or that the Court is an inappropriate forum or that the claim is so weak that it would be dismissed if there were an application by the defendant for summary judgment. There may be other grounds (eg service was irregular). Agar v Hyde at 575 [55].
·Where a conditional appearance has been filed, unless otherwise ordered, the appearance becomes unconditional (and so a submission to the jurisdiction of the Court) if no set aside application is filed or such an application is dismissed (r 168).
Further, in the case of service in a signatory country to the Hague Convention, the rules include the following:
·Upon receipt of a certificate in compliance with the convention the registrar must cause it to be filed and send a copy to the practitioner for the plaintiff (r 970F).
·A certificate that certifies that service was effected is, in the absence of evidence to the contrary, sufficient proof that service was effected by the method specified in the certificate (r 970H).
·Where a certificate has been filed that states that service has been duly effected, nevertheless default judgment cannot be given unless certain matters are established (r 970J).
·Where no certificate is filed, or where a certificate stating that service has not been effected is filed, default judgment may not be given unless a period of not less than six months has passed since the service documents were forwarded to the central authority in the foreign country and every reasonable effort has been made to obtain a certificate of service or to effect service (r 970K).
Subject to a plaintiff, who has served a writ abroad, complying with the Hague Convention (if it applies), satisfying either r 970J or r 970K as the case requires (if the Hague Convention applies) and obtaining leave to proceed (r 147B), Div 2 of Part II of the rules (which deals with obtaining default judgment generally) may be invoked by the plaintiff.
Was the method of service effective?
The plaintiff says that on an application to set aside service based on a complaint about the method of service the onus of proof is on the defendant so applying. Bayer, on the other hand, says that the onus is on the plaintiff and referred to Forestry Commission v Vickers-Armstrong (Tractors) Limited (1964) Tas SR 109.
Vickers-Armstrong concerned an application brought by a defendant, who had been served abroad, to set aside service based on a matter on which the plaintiff would have carried the onus if no appearance had been filed and the plaintiff wished to obtain leave to proceed. At the time of the decision the Rules of the Supreme Court 1958, O X1 r 10 (which was the leave to proceed rule) was substantially different to the current r 147B. Order X1 r 10 provided that leave may be given if "it is made to appear to the Court or a judge by affidavit or viva voce evidence that the subject matter of the cause is such that … the writ of summons … may be served out of the jurisdiction … and that such process … was personally served …". The writ had been served without leave under the predecessor of r 147A. It was held that as the plaintiff would carry the onus on a leave to proceed application, the plaintiff must, logically, also have the onus where the defendant takes the prudent step of entering a conditional appearance and applying to have service set aside based upon the same considerations which would apply on an application by the plaintiff for leave to proceed. The case is of no assistance where the application is based, not on points which might arise on an uncontested leave to proceed application, but based on an assertion that service was irregular.
There is no reason to depart from the usual rule that the party who asserts carries the onus when the dispute is concerned with whether or not service was regular. It follows that Bayer carries the onus on its assertion that service was irregular.
The evidence as to the manner of service is set out in the opening paragraph of these reasons. The process server attended Bayer's premises and the relevant documentation was handed to an administrative assistant who referred it to an employee of Bayer who was a lawyer. The lawyer did not say that he did not have the authority of Bayer to accept service of domestic documents and there was no evidence that neither the administrative assistant nor the lawyer lacked the relevant authority from the company, or authority derived by law, to accept the service of domestic documents. As previously stated, under the Hague Convention, service of foreign process can be effected by using the manner of service applicable to the service of documents in domestic actions in the place where service occurs. In the case of service on a corporation in the State of New Jersey service may be effected by handing the process to a person authorised by appointment or by law to receive process on behalf of the corporation.
If the onus of proof of effective service, contrary to my view, had been on the plaintiff, I would have been satisfied that the lawyer was authorised to accept service of documents in domestic actions against Bayer. The plaintiff tendered, without objection, a certificate issued by the central authority in the United States of America and filed in this Court pursuant to the Hague Convention. The certificate described the lawyer as "Person Authorised to Accept". I take the certificate to be evidence of the matters stated in it. In particular, that under the law of New Jersey the lawyer was authorised to accept service of the process on behalf of Bayer.
I would not set aside service on the basis that the method employed by the process server was ineffective.
Was the writ still in force at the time of service?
The writ was issued on 19 August 2015 and was not delivered to Bayer until a little over six months later, namely on 22 February 2016. Rule 107(1)(b) provides that a writ, unless renewed, remains in force for six months. The effect of the rule is that after the expiry of the period specified the writ is not a nullity, but merely ineffective for service. Van Leer Australia Pty Ltd v Palace Shipping KK (1981) 180 CLR 337 at 341.
The plaintiff says that the six month period during which the writ was effective for service had not expired by 22 February. Reliance was placed on r 48 which is as follows:
"Any period appointed or allowed by these rules does not include the period between the twenty-third day of December and the seventh day of January unless the Court or a judge directs otherwise."
The rule does not expressly contain any limitation on its operation. In particular it is not expressly confined in its application to periods which otherwise would expire during the excluded days, nor is it expressly confined to any particular obligations as to time imposed by the rules such as the obligations relating to the delivery of pleadings.
The rule does not contain any ambiguity. The word "appointed" means "settled or fixed beforehand; ordained". The word "appoint" includes the meaning "Decree, prescribe, fix that a thing shall be" (The New Shorter Oxford English Dictionary). Rule 107 prescribes, and so appoints, the period during which a writ is in force. Accordingly, it is a rule as to time to which r 48 applies. The application of the ordinary meaning of the words used in r 48 does not permit a result making the rule inapplicable to the period fixed by r 107. The result is not identifiable as absurd, capricious and irrational, plainly unintended or contrary to the purpose of the rule so as to justify a strained construction (if such a construction is possible) or the addition of words (if the words which should be added as intended but accidentally omitted are capable of clear identification) to confine the application of the rule. It may be that the applicability of r 48 to the period fixed by r 107 and to other lengthy periods fixed by the rules (eg r 56 which requires a party to obtain leave to proceed if no step has been taken in a proceeding for six years) was unintended by the drafters of the rule and, if that is the case, it is a matter which cannot be cured by the application of principles of statutory construction and can only be cured by amendment to the rule.
The writ was still in force at the time it was delivered to Bayer and service cannot be set aside on the ground that at the time of delivery the writ was ineffective for service.
Does r 147A(1)(g) require that an overseas co-defendant be a "necessary or proper" party to an action "properly" brought against a co-defendant served or to be served within jurisdiction?
Rule 147A(1)(g) is relevantly as follows:
"... originating process may be served outside Australia without an order of the Court where the proceedings fall either wholly or partly into one or more of the following cases:
…
(g) if the person to be served outside the State is joined as a party to proceedings that are brought against another person served, or to be served, in the State;".
The rule contains no express requirement that the overseas co-defendant be a necessary or proper party to an action properly brought against a co-defendant served or to be served within jurisdiction.
Counsel for Bayer submits that the additional requirements propounded should be implied as a matter of necessity, to give effect to the purpose of the rule.
In my respectful opinion no such necessity exists. A defendant served overseas may seek to be heard in opposition to an application by the plaintiff for leave to proceed (r 147B) or may apply to have service set aside (r 167 or r 168(4)). If such a defendant can demonstrate that the action against the defendant within jurisdiction is a sham or that the joinder of the overseas co-defendant was not in accordance with the joinder rules (Div 12 of Part 7), a ground upon which leave to proceed may be refused or a ground upon which service may be set aside will have been established and the Court may intervene as necessary or appropriate.
It follows that the plaintiff does not need to show that Bayer is a necessary or proper party to an action properly brought against a co-defendant within the jurisdiction. These are matters for Bayer to show if it wishes to do so on its set aside application.
Bayer did not contend that the joinder of the defendants within jurisdiction was a sham or otherwise inappropriate.
Whether the joinder of Bayer was necessary or proper cannot be discerned from the contents of the writ. The drafting of the endorsement of claim on the writ does not comply with r 108. In particular, it does not provide "a concise statement of the nature of the claim" against any of the defendants and in respect of Bayer it does not even state "the relief or remedy sought". A writ containing an insufficient endorsement is not a nullity (r 13). A defendant may apply for an order setting aside a writ for irregularity (r 14, r 109 and r 168(4). Bayer has made no application to set aside the writ for defects in the endorsement. If Bayer had wished to contest whether the joinder was proper, the appropriate starting point would have been to challenge the endorsement. This would likely have forced the plaintiff to apply for leave to amend. If amendment was refused the writ would be set aside. If amendment was permitted, Bayer would have been in a position, if grounds existed, to challenge whether the joinder was necessary or proper and if not necessary or proper service may have been set aside.
Service of the writ will not be set aside as being unauthorised by r 147A or on the ground that Bayer is not a necessary or proper party to an action properly brought against a co-defendant within the jurisdiction.
If the writ has not been effectively served should it be renewed?
I have found that the writ has been effectively served on Bayer. Against the event that this finding is later found to be incorrect, I will consider whether a renewal order would have been appropriate.
The writ issued on 19 August 2015, prior to the plaintiff's advisers having obtained expert advice necessary to enable a fully informed opinion to be given as to the plaintiff's prospects of success. The writ issued at the time it did because the plaintiff's solicitor, incorrectly, believed that a three year limitation period was about to expire. The plaintiff's claim is based on an allegation of injury following the implantation into her fallopian tubes of devices supplied by Bayer. The implantations are claimed to have been performed on 21 August 2012. The plaintiff's uncontradicted evidence is that she was told by her doctor in late 2012 that her symptoms were not caused by the devices implanted. It was not until July 2013 that a specialist told the plaintiff that the plaintiff's symptoms were the result of the implantation of the devices and recommended a hysterectomy which was undertaken shortly thereafter.
The time when the plaintiff first consulted solicitors is not disclosed by the evidence. The plaintiff changed solicitors and engaged her present solicitors in July 2015. It was not until early October that the solicitors sought instructions from the plaintiff to obtain necessary expert advice. The instructions from the plaintiff were not forthcoming until November, as the plaintiff had been unwell and was suffering from depression. By December the expert opinion had still not been obtained. The plaintiff's solicitor believed that, notwithstanding this, there was sufficient merit in the claim to justify proceeding to service of the writ.
On 21 December 2015 the solicitor sent the request for service to the Court. The request was duly processed and the documents sent to the central authority in the United States of America on 23 December with a request for expedited service. On 10 February 2016 the plaintiff's solicitor received advice from the Court that the service documents had been returned for want of pre-payment of the required service fee of $95 USD. The solicitor attended to the payment on the same day and the documents were re-sent to the central authority in the USA on 11 February. Service arrangements were made in the USA and the process server attended the New Jersey premises of Bayer on 22 February to deliver the documents. No notice of the claim had been given to Bayer prior to this time.
The renewal application was filed on 20 April 2016.
Rule 107 provides that a writ may be renewed on application made whilst the writ remains in force. Accordingly, the renewal application also included an application, pursuant to r 52, for an extension of time for the bringing of the application. Generally, if renewal is appropriate, an order extending time for the bringing of a late application will also be appropriate. National Mutual Life Association of Australasia Ltd v Huddlestone & Anor [1997] TASSC 73 (a decision of the Full Court).
The parties are agreed that the principles upon which a renewal application should be approached are as set out in Varga v Mandapati [2014] TASSC 25 and the submissions were so confined. There is no need for me to restate the relevant considerations except as to one aspect. Counsel for Bayer submits that delay in issuing a writ is relevant on a renewal application. Obviously, if a plaintiff is still within time to sue by a fresh writ there would be no point withholding renewal. A new writ could issue and the position of the defendant would not have been affected. On the other hand, if a limitation period has expired and the defendant can show that the lack of notice of the claim has adversely affected the defendant's ability to defend the case or has otherwise caused prejudice, pre-action delay by the plaintiff will be relevant to, but not necessarily determinative of, the question of whether or not the justice of the case lies with renewal. With time starting to run in some cases under limitation statutes from the "date of discoverability", often there will be no ready answer to the question of whether or not a limitation period passed during the period in which the writ remained unserved. In my view, in such a case it would be neither necessary nor desirable for a court to embark upon an enquiry as to the date of discoverability. The Court, except in clear cases, should simply take into account the possibility that a new action might be statute barred and assess the impact on the defendant of the delay overall. Where the defendant shows that a fair trial, because of delay, can no longer occur or that there is other prejudice, the Court should take that feature into account in deciding whether to refuse renewal and leave the plaintiff to recommence, so that any limitation point might be pleaded and argued in the new action.
Counsel for Bayer submitted that, because of lack of particularity of the claim, Bayer is unable to assess whether delay has, or might have, resulted in prejudice. This may be so, but the existence of prejudice would be a matter of no relevance unless there was a possibility that a new action, if commenced now, would be statute barred. Bayer has not suggested that a new action, commenced now, might be barred by limitation legislation.
Here, the delay in attempting service following the issue of the writ was not great. The attempts made at service thereafter were diligent. The existence of the writ came to the attention of Bayer within about six months of issue. The application for renewal was made promptly after Bayer disputed valid service. Bayer has presented no evidence that it has been or might have been, because of delay, deprived of the opportunity of a fair trial or otherwise prejudiced. There is nothing in the circumstances of the case to indicate that any material prejudice might be caused to Bayer if the writ is renewed.
If service had been set aside, I would have extended the time for the plaintiff to apply for renewal and I would have renewed the writ.
If the delivery of the writ occurred after the six month period during which it was in force had expired, I would only have renewed the writ until 22 February 2016. Rule 107(6) provides that "A renewed writ is in force from the date of issue of the original writ". The effect of renewal would have been to correct the irregularity.
Disposition
The writ was capable of being served abroad without leave. It was served. No irregularity as to service has been established. No other basis for setting aside service has been established. Bayer's set aside application must be dismissed. The writ does not need to be renewed and so the plaintiff's renewal application must also be dismissed.
Bayer has filed a conditional appearance and, unless otherwise ordered, the appearance becomes unconditional on the dismissal of the set aside application (r 168(5)). Bayer submits that it should not be disadvantaged by its appearance becoming unconditional. However, no disadvantage or potential disadvantage resulting from the appearance becoming unconditional was put forward on behalf of Bayer. Nothing was suggested as being arguable on an opposed leave to proceed application, if there is no appearance, which could not have been argued on Bayer's set aside application. There is no reason to prevent the appearance from becoming unconditional.
These are the orders:
(1) The set aside application brought by the fourth defendant is dismissed.
(2) The renewal application brought by the plaintiff is dismissed.
I will hear the parties as to costs.
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