Dyer v Dyno Nobel Asia Pacific Limited Formerly Dyno Wesfarmers Limited Knuckey and 3 Ors v Dyno Nobel Asia Pacific Limited Formerly Dyno Wesfarmers Limited

[2003] NSWSC 213

NEW SOUTH WALES SUPREME COURT

CITATION:      Dyer v Dyno Nobel Asia Pacific Limited formerly Dyno Wesfarmers Limited  Knuckey & 3 Ors v Dyno Nobel Asia Pacific Limited formerly Dyno Wesfarmers Limited    [2003]  NSWSC 213

CURRENT JURISDICTION:               Common law

FILE NUMBER(S):    20315/96
20744/97

HEARING DATE{S):               21.10.02

JUDGMENT DATE: 27/03/2003

PARTIES:
Jacquelyn Dyer - Plaintiff
Dyno Nobel Asia Pacific Limited formerly Dyno Wesfarmers Limited - Defendant
Margaret Knuckey and 3 ors - Plaintiffs
Dyno Nobel Asia Pacific Limited formerly Dyno Wesfarmers Limited - Defendants
Workcover Queensland - First Cross Defendant
MMI Workers' Compensation Insurance - Second Cross Defendant
QBE Insurance (PNG) Limited - Third Cross Defendant

JUDGMENT OF:       Mathews AJ      

LOWER COURT JURISDICTION: Not Applicable

LOWER COURT FILE NUMBER(S):         Not Applicable

LOWER COURT JUDICIAL OFFICER:     Not Applicable

COUNSEL:
Ms A Katzmann SC with Mr M Cahill - Plaintiff Dyer
Mr M Joseph SC with M M Cahill - Plaintiff Knuckey
Mr N Cotman SC with Mr R Parsons - Defendant
Mr J Sharpe SC for Workcover Queensland - First Cross Defendant
Mr C Hoeben SC for MMI Workers' Compensation (NSW) Limited - Second Cross-Defendant
Mr M Sheller for QBE Insurance (PNG) Limited - third Cross Defendant

SOLICITORS:
Ken Hooper & Assoc - Gatton Qld - Plaintiff Dyer
Slater & Gordon - Plaintiff Knuckey
Gadens Lawyers Brisbane - Defendants
Thynne & McCartney - Brisbane - First Cross Defendant
Hickson Wisewoulds - Second Cross Defendant
Phillips Fox - Third Cross Defendant

CATCHWORDS:
Compensation to Relatives proceedings commenced in NSW
deceased died in accident in Papua New Guinea
statements of claim said to be pursuant to NSW Compensation to Relatives Act
application to amend statements of claim to insert claims under Wrongs Act (PNG) following High Court judgment in  Regie National des Usines Renault SA  v  Zhang
actions now statute barred in Papua New Guinea
whether Papua New Guinea limitations legislation applies to defeat claims
discussion of the effect of Zhang
held that amendment not necessary.

ACTS CITED:
Compensation to Relatives Act 1897
Wrongs (Miscellaneous Provisions) Act (PNG)
Workers Compensation Act 1987 (NSW)
Supreme Court Rules

DECISION:
No amendment of either statement of claim is necessary.  The actions are to proceed on the basis that Papua New Guinea law applies by dint of the  choice of law rules.  The costs of these applications are to be costs in the cause.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

MATHEWS AJ

27 March 2003

20315/96

Jacquelyn DYER  v  DYNO NOBEL ASIA PACIFIC LIMITED –

FORMERLY DYNO WESFARMERS LIMITED

20744/97

Margaret KNUCKEY & 3 ors  v  DYNO NOBEL ASIA PACIFIC LIMITED – FORMERLY  DYNO WESFARMERS LIMITED

JUDGMENT

1. HER HONOUR:  On 2 August 1994 a catastrophic explosion occurred at an explosives management plant at the Porgera Gold Mine in the Enga Province of Papua New Guinea. Numerous people were killed in the blast. Amongst the Australians to perish were Geoffrey Raymond Dyer and Phillip John Knuckey. On 29 March 1996 Geoffrey Dyer’s widow, Jacquelyn Dyer, commenced proceedings against her late husband’s employer (“Dyno”) which occupied and controlled the Porgera plant at the time of the explosion. The statement of claim sought damages pursuant to s 3 of the Compensation to Relatives Act 1897 NSW (“the NSW Act”). 

2. On 31 July 1997 Margaret Knuckey, the widow of Phillip Knuckey, together with their three children, commenced proceedings against Dyno, also seeking damages under the NSW Act.  The statement of claim included a claim for damages for nervous shock said to have been sustained by Mrs Knuckey.

3. For present purposes, it is unnecessary to detail the course of either action after the lodgement of the statement of claim.  The only matter of potential relevance is the fact that Dyno has admitted a breach of duty in relation to the deaths of Mr Dyer and Mr Knuckey.  Accordingly, subject to proof of dependency, the sole issues remaining in contention in each case relate to the assessment of damages. 

4. An important preliminary issue has arisen which gives rise to interesting questions of private international law. It was assumed, when both proceedings were commenced, that the applicable law in cases of this nature would be the law of the forum, namely the law of NSW Act. It was for this reason that both claims were said to be pursuant to the New South Wales Compensation to Relatives Act. However since the High Court decision in Regie National des Usines Renault SA  v  Zhang [2002] 187 ALR 1 in March 2002, the law of the place of the wrong, namely Papua New Guinea, must be taken to be the applicable law in all matters of substance which arise in these actions. Accordingly, both plaintiffs have sought to amend their statements of claim to add, alternatively to the claim under the NSW Act, a claim under the Wrongs (Miscellaneous Provisions) Act (PNG) (“the PNG Act”).  Mrs Dyer also initially sought, in her capacity as Mr Dyer’s administrator, to add a claim for loss of life expectancy, a claim which is available in Papua New Guinea but not in Australia.  However this application was later withdrawn.  This was a realistic approach.  As the discussion which follows will illustrate, this part of Mrs Dyer’s application could not possibly have succeeded.

5. It is unnecessary to discuss the contents of the respective laws in any detail. Suffice it to say that the relevant provisions of the PNG Act relating to claims by dependents are essentially identical with those of the NSW Act. The problem in this case arises because s 31 of the PNG Act stipulates that all actions under that Part (which contains the provisions relied upon by the plaintiffs) “must be commenced within three years after the death of the deceased person.” In addition s 16(1) of the Frauds and Limitations Act, 1988 (PNG) provides that an action in tort shall not be brought more than six years after the cause of action accrued.  Dyno submits that it is not now open to the Court to allow the amendments sought by the plaintiffs.  Recent High Court authority, it is submitted, makes it clear that Papua New Guinea’s limitation laws are applicable in the present case.  Accordingly, the effect of the amendment would be to allow the plaintiffs to now invoke a cause of action which has long since been extinguished under the laws of Papua New Guinea. 

6. In order to explore this issue further, it is necessary to delve with more detail into the legal background of the matter.

7. Until relatively recently, it was accepted that the “double actionability” rule applied when an Australian court’s jurisdiction was invoked in relation to a tort committed outside the jurisdiction, whether in an interstate or an international context.    This meant, in relation to international torts, that they needed  to be actionable under the law of the forum and not justifiable under the law of the place where they were done.  If these conditions were fulfilled an Australian court could assume jurisdiction notwithstanding that the tort occurred outside Australia.  (See Koop  v  Bebb (1951) 84 CLR 629).

8. Once an Australian court accepts jurisdiction in relation to a foreign tort, the local choice of law rules will govern which laws should be applied in determining the matter.  The actionability of a tort and the law which is to be applied in relation to it involve quite different considerations, as the High Court has recently emphasised. 

9. Until the High Court decision in John Pfeiffer Pty Limited  v  Rogerson (2000) 203 CLR 503 the law of the forum was taken to apply in all cases involving torts committed outside the jurisdiction, whether in an interstate or an international context. In Pfeiffer the plaintiff commenced proceedings in the Australian Capital Territory in relation to an accident which had occurred in New South Wales.  The Workers Compensation Act 1987 (NSW) imposed a limit on damages recoverable in that State. There was no equivalent limitation in the Australian Capital Territory. The majority of the Court (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ) discussed the manner in which the rules had developed relating to torts with an interstate element, and proceeded to reconsider the rules relating to both actionability and choice of law in all such cases. The majority in effect discarded the requirement for double actionability in relation to interstate torts. More importantly for present purposes, their Honours stated that henceforth the law of the place of the wrong should be taken to be the governing law with respect to torts which have an interstate element.

10. The Court in Pfeiffer was at pains to restrict this part of its discussion to cases having an interstate element.  The majority did not purport to address the question of torts committed in an international context.  It was not until Zhang that this situation arose for consideration.  The plaintiff in that case commenced proceedings in New South Wales to recover damages for injuries he sustained in an accident in New Caledonia.  The defendant sought to stay Mr Zhang’s action on the footing that the New South Wales Supreme Court was an inappropriate forum for the trial of the action.  The stay was granted by the primary judge.  One of the principal bases for his finding that the New South Wales court was an inappropriate forum arose from his understanding that the French law, being the law of the place of the wrong, would need to be applied in the proceedings.  The Court of Appeal quashed the stay upon the basis that New South Wales law, not French law, was the applicable law.  On appeal to the High Court, therefore, the question was directly raised as to whether the law of the forum or the law of the place of the wrong should be applied in relation to torts committed outside Australia.  The majority of the Court (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ) proceeded to extend the principles which had been enunciated in Pfeiffer into an international setting.  It stipulated that the double actionability rule should have no application in relation to international torts.  More importantly here, the majority ruled that henceforth the law of the place of the wrong should be applied by Australian courts in determining questions of substance in relation to foreign torts.

11. It was after the decision in Zhang that the present plaintiffs sought to amend their respective statements of claim so as to insert a claim under the PNG Act as an alternative to the existing claims under the NSW Act. In doing so they relied on Pt 20 of the Supreme Court Rules. Pt 20 r 1 gives the Court a general discretion to order that any document in the proceedings be amended. Part 20 r 4 relates to amendments where limitation periods apply. That rule, as relevant here, provides as follows:

    [20.4]     Statutes of limitation

    4     (1)     Where any relevant period of limitation expires after the date of filing of a statement of claim and after that expiry an application is made under rule 1 for leave to amend the statement of claim by making the amendment mentioned in any of subrules (3), (4) and (5), the Court may in the circumstances mentioned in that subrule make an order giving leave accordingly, notwithstanding that that period has expired.

    (3)     Where there has been a mistake in the name of a party and the Court is satisfied that the mistake was not misleading nor such as to cause reasonable doubt as to the identity of the person intended to be made a party, the Court may make an order for leave to make an amendment to correct the mistake, whether or not the effect of the amendment is to substitute a new party.

    (4)     Where, on or after the date of filing a statement of claim, the plaintiff is or becomes entitled to sue in any capacity, the Court may order that the plaintiff have leave to make an amendment having the effect that he sues in that capacity

    (5)     Where a plaintiff, in his statement of claim, makes a claim for relief on a cause of action arising out of any facts, the Court may order that he have leave to make an amendment having the effect of adding or substituting a new cause of action arising out of the same or substantially the same facts and a claim for relief on that new cause of action.

    (5A)     An amendment made pursuant to an order made under this rule shall, unless the Court otherwise orders, relate back to the date of filing the statement of claim.

    …

    (7)     This rule does not limit the powers of the Court under rule 1.

12. Mr Cotman SC, who appeared for the defendant in both proceedings, submitted that the plaintiffs cannot invoke Pt 20 r 4, (which he categorises as a mere procedural provision) in order to override the substantive law of Papua New Guinea. He relied upon the following passage from the majority judgment in Pfeiffer as establishing that the Papua New Guinea limitations provisions form part of the substantive law of that country. (p 543)

    “[98]      Some statutes of limitation have traditionally been held to be procedural on the basis that they bar the remedy not the right; other limitation provisions have been held to be substantive. But all limitation provisions can affect whether a plaintiff recovers. Questions of what heads of damage are allowable have been held to be substantive; but questions of quantification of damages have been held to be procedural. But all questions about damages can affect how much a plaintiff recovers and, thus, statutes such as the NSW Compensation Act, which is in issue in this case, alter the rights of plaintiffs and, also, the obligations of defendants.

    [99]        Two guiding principles should be seen as lying behind the need to distinguish between substantive and procedural issues. First, litigants who resort to a court to obtain relief must take the court as they find it. A plaintiff cannot ask that a tribunal which does not exist in the forum (but does in the place where a wrong was committed) should be established to deal, in the forum, with the claim that the plaintiff makes. Similarly, the plaintiff cannot ask that the courts of the forum adopt procedures or give remedies of a kind which their constituting statutes do not contemplate any more than the plaintiff can ask that the court apply any adjectival law other than the laws of the forum. Secondly, matters that affect the existence, extent or enforceability of the rights or duties of the parties to an action are matters that, on their face, appear to be concerned with issues of substance, not with issues of procedure. Or to adopt the formulation put forward by Mason CJ in McKain, "rules which are directed to governing or regulating the mode or conduct of court proceedings" are procedural and all other provisions or rules are to be classified as substantive.

    [100]      These principles may require further elucidation in subsequent decisions but it should be noted that giving effect to them has significant consequences for the kinds of case in which the distinction between substance and procedure has previously been applied. First, the application of any limitation period, whether barring the remedy or extinguishing the right, would be taken to be a question of substance not procedure (which is the result arrived at by the statutes previously referred to). The application of any limitation period would, therefore, continue to be governed (as that legislation requires) by the lex loci delicti. Secondly, all questions about the kinds of damage, or amount of damages that may be recovered, would likewise be treated as substantive issues governed by the lex loci delicti.”

13. Mr Cotman prefaced his submission with the observation that, if the limitation provisions he relies upon as extinguishing the plaintiff’s claims had been contained in local legislation, no difficulties would have arisen. The plaintiffs could have invoked Pt 20 r 4 for the purpose of pleading what would otherwise be a statute barred claim. In this regard, Mr Cotman conceded that the defendant would suffer no prejudice if the amendments now sought were allowed. If the matter were to be resolved according to discretionary considerations, he said, the defendant would not oppose the applications. However he submitted that there was no scope for the exercise of any discretion, as the court has no power to allow the amendments. To do so, he urged, would be to invoke New South Wales procedural rules for the purpose of overriding the substantive laws of Papua New Guinea. Part 20 r 4 cannot, he said, be used in this manner.

14. It should be noted that the rules of the Papua New Guinea Supreme Court are, in all relevant respects, identical to Pt 20 r 4, except that there is no equivalent to Pt 20 r 4(5A), which was inserted into the New South rules in 1989. However Mr Cotman submits that the provisions of the Papua New Guinea rules are irrelevant to the present issue. By definition, they can apply only in proceedings brought in the Papua New Guinean courts. It matters not, he submits, that the plaintiffs would have been able to amend their pleadings had the proceedings been commenced in Papua New Guinea. In that event the entire proceedings would have been subject to Papua New Guinea law. The difficulty in these cases arises from the fact that there are two legal systems to be applied: the procedural laws of New South Wales, and the substantive laws of Papua New Guinea.

15. Mr Cotman’s submissions were based, at least in part, upon the proposition that the plaintiffs, in pleading the NSW Compensation to Relatives Act in their original statements of claim, had elected to “harness” the law of New South Wales as the applicable law in the proceedings. Having made this choice, he submitted, the plaintiffs cannot now tell the court that they have “changed their minds” and that they wish to invoke the Papua New Guinea laws. Their claims are statute barred in Papua New Guinea and have long since been extinguished by the limitations legislation which forms part of the substantive law of that country.

16. In response, Ms Katzmann SC, who appeared for Mrs Dyer, and Mr Joseph SC, who appeared for Mrs Knuckey and her children, rely on the proposition that, at least until Zhang, it was not necessary for a plaintiff to plead any law, be it local or foreign, in an initiating process involving a tort committed outside the jurisdiction.  As Hutley JA said in Walker v WA Pickles Pty Ltd [1980] 2 NSWLR 281 at 284-5

    “(4)        An action of tort may be brought in new South Wales courts irrespective of where the facts founding the action may have occurred, even if they occurred in a place where there may be no law at all:  see Mostyn  v  Fabrigas (9a).  A pleading of a cause of action in tort which did not allege that the facts occurred in any particular law district would be formally valid.  On the basis that the utmost economy is enjoined by the rules, it would seem to me that pleading of a foreign element in the initiating process in a claim in tort can never be necessary.  Indeed, this seems to have been the practice:  see Kolsky  v  Mayne Nickless Ltd;  Anderson v Eric Anderson Radio & TV Pty Ltd

    (5)          This approach is reinforced by the principle that foreign law, which is, except between the States and the Territories of the Commonwealth, a fact, is presumed to be the same as local law;  and a fact presumed to be true does not have to be pleaded:  see Supreme Court Rules, Pt 15, r 10(a) ...

    (6)          The principle of private international law (in relation to actions in tort where the tortious acts occurred abroad) that the local law applies, but the acts relied upon must not be justifiable in the place in which they were done, it seems to me, assimilates the latter requirement to an exculpatory fact, and the burden of pleading and proving an exculpatory fact in civil proceedings lies generally upon a defendant.  Unless therefore, there is binding authority to the contrary, it seems to me a matter of principle that Par 4 of the statement of claim in this case correctly alleged all that was necessary to enable the plaintiff’s case on the statutory claim to be put before the jury;  and that any question of Victorian law could only arise if the defendant elected to justify what it had done in reliance upon that law.

1. It follows, according to Ms Katzmann and Mr Joseph, that those portions of the original statements of claim which purported to “harness” the New South Wales law by claiming relief under the NSW Act, need never have been pleaded.  Those claims were otiose, it is submitted, and cannot now be used by the defendant as a foundation for submitting that the amendments sought by the plaintiffs represent a fundamental shift in their position.

1. This issue, of the extent to which a foreign law need be pleaded, was discussed by the majority in Zhang in the following terms:

   “[68]      Once the distinction between jurisdiction as a "threshold requirement" and choice of law is appreciated, it will be seen that there is no obligation upon either party to plead foreign law in order to render a claim or cross-claim justiciable. If, however, either party seeks to rely on foreign law, rules of court and general principles of pleading may oblige the party to plead the relevant foreign law. As is said in Bullen & Leake & Jacob's Precedents of Pleadings:

   "Where a party relies on foreign law to support his claim or as a ground of defence thereto, he must specially plead the foreign law relied on in his statement of claim or defence, as the case may be, and he should give full particulars of the precise statute, code, rule, regulation, ordinance or case law relied on, with the material sections, clauses or provisions thereof. A mere allegation that an instrument depending on foreign law is null and void is too vague."

   In the present case, on one reading of the statement of claim, the plaintiff alleged that the lex causae was that applicable in New Caledonia but did so in terms which did not comply with the above principles.

   [69]        Two particular questions arise respecting the pleading of foreign law in tort actions. They arose in the past in cases concerning the term "justifiable" in the second limb of the "double actionability" rule, but the answers are applicable to the state of doctrine as established by Pfeiffer and the decision on the present appeal.

   [70]        The first question is whether it is necessary for the plaintiff to plead the foreign law in order to establish a cause of action. The answer preferred by Dicey is in the negative. In Walker v W A Pickles Pty Ltd, Hutley JA explained:

   "An action of tort may be brought in New South Wales courts irrespective of where the facts founding the action may have occurred, even if they occurred in a place where there may be no law at all: see Mostyn v Fabrigas. A pleading of a cause of action in tort which did not allege that the facts occurred in any particular law district would be formally valid. On the basis that the utmost economy is enjoined by the rules, it would seem to me that pleading of a foreign element in the initiating process in a claim in tort can never be necessary. ...

   This approach is reinforced by the principle that foreign law, which is, except between the States and the Territories of the Commonwealth, a fact, is presumed to be the same as local law; and a fact presumed to be true does not have to be pleaded: See Supreme Court Rules, Pt 15, r 10(a)."

   On the other hand, if the defendant seeks to rely upon a foreign lex causae, then, in the ordinary way, it is for the defendant to allege and prove that law as an exculpatory fact.

   [71]        The second question is whether, whilst not obliged to do so, it is for a plaintiff who sees a forensic advantage in the foreign law (for example, in its provision for strict liability) to plead that law in its statement of claim or other initiating pleading. In Walker, Hutley JA concluded not only that it was unnecessary for the plaintiff to plead the foreign law but wrong to do so. However, what is involved here is the application of a choice of law rule. It cannot be beyond the competence of the plaintiff to invoke that rule and be solely for the defendant to rely upon it for any exculpation it offers. The term "justifiable" may have conveyed a suggestion of exculpation but since the reformulation of the second limb by Brennan J in Breavington, that term has not appeared and it cannot control the operation of a choice of law rule which selects the lex loci delicti as that to be applied in Australia to govern questions of substance in a proceeding arising from a foreign tort. It follows that the rule must be that which Dicey regards as "well established", namely that "a party" who relies on a foreign lex loci delicti "must allege, and, if necessary, prove it".

   [72]        Where, as here, the applicant on a stay motion seeks to rely upon a foreign lex causae as providing an advantage, then, at a level of specificity, the applicant should advance appropriate evidence as to the foreign law and particular features of that law which provide that advantage to the applicant.”

2. Mr Joseph urges that the apparently general statement at the end of paragraph 71 must be read down by the question which the majority had posed for itself at the commencement of that paragraph.  In other words, the requirement that a party who relies on a foreign law “must allege, and, if necessary, prove it” applies only to a plaintiff who seeks a forensic advantage from that law, such as in its provision for strict liability.  Neither plaintiff in the present case is seeking such an advantage.  It follows, Mr Joseph urges, that the plaintiffs do not need to plead Papua New Guinean law in their initiating process, and it is therefore unnecessary to amend their statements of claim so as to invoke that law.  They are seeking to do so only for abundant caution.  It would be open to the plaintiffs, according to this submission, to continue with their claims as currently framed and then rely upon Zhang at the hearing as providing that the applicable law is that of Papua New Guinea.

3. Mr Joseph’s submission highlights an apparent ambiguity in the ambit of the requirement formulated by the majority in the last sentence of paragraph 71 quoted above.  A recourse to the passage from Dicey cited by the majority does little to resolve the matter.  Dicey’s statement was made in the course of discussing the double actionability rule as it applies to defamation cases.  It has little to do with choice of law rules.

4. I agree with Mr Joseph’s submission as to the limited application of the requirement, specified by the majority in Zhang, that a party who relies on a foreign law must allege and, if necessary, prove it.  Neither Pfeiffer nor Zhang sought to displace the presumption, referred to by Hutley J in Walker, that foreign law is presumed to be the same as local law.  One must therefore ask why foreign law would need to be specially pleaded, unless a plaintiff was seeking to rely on some aspect of it which differed from local law or, to put it in the terms used in Zhang, was seeking to gain a “forensic advantage” under the foreign law.

5. The significance of this will depend, to some extent, upon an analysis of the effect of the choice of law rule expounded in Zhang, a matter I will be discussing shortly.  In the meantime it is apposite to refer to a separate but not entirely unrelated submission made by Ms Katzmann. 

6. Ms Katzmann pointed out that the defendant has not pleaded any defence under the Papua New Guinea limitations legislation.  In the absence of any such defence the defendant could not, she submitted, raise an argument that the plaintiffs’ claims were statute barred as a ground for opposing the amendments sought by them.  The defendant’s response to this submission was that, until the amendments sought by the plaintiffs are made, no foundation has been laid for pleading any such defence.  There is an obvious circularity in these submissions.  Effectively, I take the defendant to be saying that there would be no point in the Court allowing the amendments sought by the plaintiffs because the claims, as amended, would inevitably be met by a successful defence under the Papua New Guinea limitations legislation.  Seen thus, the matter raised by the defendant might be categorised as raising a discretionary consideration.  However it is one of such potential power that, if correct, it would outweigh all other considerations.  There would be no point whatsoever in allowing the amendments sought by the plaintiffs if they were to be met, as the defendant asserts they would, with successful defences under the Papua New Guinea limitations legislation. 

7. All of these submissions raise a fundamental issue as to the effect of the judgment in Zhang upon these proceedings.  There is one obvious effect, namely that at the hearing of these actions the law of the place of the wrong, which in this case is Papua New Guinean law, will need to be applied in order to determine the substantive issues between the parties.  There is much to be said, in my view, for the proposition that the impact of Zhang extends little if any beyond this.  In particular, I am strongly inclined to the view that Zhang does not require that the law of the place of the wrong be pleaded by a party unless some facet of that law is to be relied upon which has no parallel in the local law.  In the present case, the Papua New Guinea Wrongs Act is essentially identical with the NSW Act.  That Act will be applied in these proceedings not because of the manner in which in the statements of claim have been framed, but by virtue of the applicable choice of law rules.

8. Both statements of claim in the present case were lodged within the limitation periods specified under both New South Wales and Papua New Guinean laws.  Let us assume, for the moment, that the Papua New Guinean limitation laws provided more stringent time limits than those in New South Wales, with the result that the plaintiffs’ claims were statute barred in Papua New Guinea but not in New South Wales.  Until Zhang, this would have been an irrelevant matter as the applicable law in all respects was taken to be that of New South Wales.  Since Zhang, it would be open for the defendant to amend its pleadings so as to add a defence that the plaintiffs’ claims were statute barred under the New Guinea law, if that were the case.  The defendant in that event would be seeking a “forensic advantage” under the foreign law which is not available under local law, and would need to specially plead it.  However in the present proceedings this course is not open to the defendant, for both actions were commenced within the time limits allowed under both New South Wales and Papua New Guinea limitation laws. 

9. A further illustration is provided by the circumstances of Mrs Dyer’s action.  When Mrs Dyer first applied to amend her statement of claim she sought to add an averment that she had been appointed administrator of her late husband’s estate, and to insert a claim on his behalf for damages for loss of expectation of life.  This is a cause of action in Papua New Guinea but not in New South Wales.  In order to assert this claim, Mrs Dyer would need to amend her statement of claim so as to plead the appropriate Papua New Guinea law for she would be claiming a benefit under that law which is not available under local law.  This would be a new cause of action, propounded by Mrs Dyer in her representative capacity, whereas the existing proceedings were propounded in her personal capacity.  This being so, a defence under the Papua New Guinea limitations legislation would inevitably be successful.  It was no doubt in recognition of this fact that Ms Katzmann withdrew the application to amend the statement of claim in this manner.

10. I return to my discussion of the effect of Zhang on the present cases.  The mere fact that all parties believed, when these actions were commenced, that New South Wales substantive law would apply to the proceedings, is irrelevant for present purposes.  That belief was later shown by the majority judgment in Zhang to represent an erroneous (or outmoded) view of the common law.  Similarly, the fact that the statements of claim contained a reference to the New South Wales legislation was irrelevant.  It was irrelevant on two bases:  first because it was an unnecessary averment, and secondly because it did no more than state the parties’ erroneous view as to the choice of law rules which would apply.  It certainly did not amount to an “election” by the plaintiffs to invoke New South Wales law.  Nor could it have been effective to do so, once Zhang had established that foreign law was to be applied in cases of this nature.  As I have said, the Papua New Guinea law will be applied in these proceedings by virtue of the applicable choice of law rules, not because of any election by the plaintiffs or any averment in their statements of claim.

11. The defendant’s arguments proceed upon the assumption that the effect of the plaintiffs’ amendments will be to “harness” Papua New Guinean law for the first time.  This pre-supposes that, without the amendments, or at least until they are made, the NSW Act will remain the governing legislation.  But this cannot be reconciled with Zhang, which states that the law of the place of the wrong is to be applied in all cases involving foreign torts.   

12. In my view it is unnecessary for the plaintiffs to amend their statements of claim in order to assert a claim under the Papua New Guinea Wrongs Act.  Therefore there is no question of a defence being filed under the Papua New Guinea limitations legislation.  Accordingly, the hearing of the matter has been able to proceed with the existing pleadings.  The references in the statements of claim to the NSW Act are otiose and of no effect.  Papua New Guinea law will be applied to all matters of substance between the parties.

13. This conclusion accords, in my view, not only with the legal analysis of the situation but also with justice and fairness.  It would be unjust in the extreme if plaintiffs who had commenced proceedings within time could later find that their actions were statute barred simply because the prevailing choice of law rules had changed in the meantime.  That is all that has happened here.

14. No amendment of either statement of claim is necessary.  The actions are to proceed on the basis that Papua New Guinea law applies by dint of the choice of law rules.  The costs of these applications are to be costs in the cause.

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LAST UPDATED:               08/04/2003