Frost & Ors v Warner

[2001] HCATrans 154

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S195 of 2000

B e t w e e n -

SUSAN MARY FROST

First Appellant

MELISSA FROST by her next friend SUSAN MARY FROST

Second Appellant

DONALD MARTIN

Third Appellant

and

CAROLYN WARNER

Respondent

GLEESON CJ
GAUDRON J
GUMMOW J
KIRBY J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON TUESDAY, 29 MAY 2001, AT 10.15 AM

Copyright in the High Court of Australia

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friend, MR G.R. KENNETT, for the appellants.  (instructed by McDonald Johnson)

MR G.K. DOWNES, QC:   If the Court pleases, I appear with my learned friend, MR S.J. MOTBEY, for the respondent.  (instructed by Selby Anderson)

GLEESON CJ:   Mr Jackson.

MR JACKSON:   Thank you, your Honours.  Your Honours, a question arises in relation to my learned friends notice of contention and our submissions we are happy to make in relation to that at a later point and may I proceed with the appeal as such and come to the notice of contention in due course.

Your Honours, as is apparent from the written submissions, the appeal is concerned with two issues of liability of the respondent, one personal, one vicarious.  May I deal with them in that order, and in relation to them may I go very briefly to the underlying facts and they are these:  that five young children died when the respondent’s vessel sank in Port Stephens on a journey from Moffatts Oyster Barn to Soldiers Point Marina on 8 February 1990.  They died when the vessel sank and they were stuck, caught, in a compartment or cabin at the bow.  Considerable efforts to free them all failed and, as the primary judge found, the tragedy was caused by the overcrowding, far too many people and obviously far too many people, aboard the vessel. 

I will come to the exact finding in a moment, your Honours, but may we say, by way of introduction, that was not a passing observation of the trial judge; it was a finding made after hearing oral evidence from at least three expert witnesses and arriving at a conclusion in relation to that evidence, and the conclusion was that the primary judge accepted the evidence of an entirely independent expert witness – when I say independent, he had not been engaged by any of the parties, but had been involved in the coronial inquiry, to Mr Bundschuh, and his evidence was to the effect that the vessel was grossly, dangerously and visibly overloaded.

Your Honours will see that in volume 2 at page 358.  Commencing at about line 25, your Honours will see a reference to Mr Bundschuh’s evidence and that goes through that page, to the bottom of the page.  He referred to:

the purpose of his inquiry . . . reserve of stability was very poor.  Probably the worst I have ever come across.”

Then, your Honours, if one goes on the next page, page 359, through to about line 36 on that page.  That evidence was accepted on page 360, about lines 19 to 20 and between lines 25 and 30 on page 360 and, in particular, could I refer your Honours back to page 359, about lines 15 to 18.

Now, your Honours, could I just add that it was not in dispute that there were, in fact, 49 people aboard the vessel – that is at page 349, about line 40 – and, your Honours, it was plain, in a context where the boat was, as his Honour found, visibly overloaded, that the respondent knew that the vessel was overloaded and, as the judge found, that was manifest, but, in addition, the respondent actually knew how many people were aboard.  Your Honours will see that, first from her record of interview after the accident in volume 2 at page 332, lines 15 to 35, where the – an interview with Detective Coffee.  Your Honours will see the passage from lines 15 to 35.  She “thought forty three” and the highest number that had previously been on the vessel was about 20.

KIRBY J:   This is 322, is it, or 332?

MR JACKSON:   I am sorry, 332, your Honour.  Now, your Honours will see she said she thought 43 and the number is actually 49, but there was evidence which allowed the judge to form the view that she may well have known that there were 49 because, your Honours, there was evidence not the subject of cross-examination from two of the appellants that when the party had been having lunch at the Oyster Barn one of the persons who was there had made a speech in which the person had referred to there being the 49 people aboard.  Your Honours will see that referred to in volume 1 in the evidence of the appellant, Susan Frost, at the top of page 35 and your Honours will see down to line 15 the number was specifically mentioned.  As I indicated earlier, your Honours, that was not the subject of cross‑examination.

At page 65, the appellant, Donald Martin, lines 33 to 36 said the same thing.  Again, it was not the subject of cross‑examination.  The respondent, however, was asked about this and that appears in the same volume at page 149 at a passage from line 30 to 45.  Then, going on to page 150, about line 15, and the issue is dealt with further down page 150, line 33 through to 38, where she said she thought she “heard somebody at Moffatt’s at the wharf I think 43”.

Your Honours, she was aware that the vessel should not be overloaded – that is page 159, line 26 – it is a passage, your Honours, I should say, commences about line 26.  She had had a licence herself since April 1985; the accident was in January 1990; and in the passage that goes through, your Honours, to page 160, about line 37, she said it was:  “common knowledge, commonsense” that the vessel was not to be overloaded.  Your Honours, the primary judge’s finding at page 366 in volume 2, in relation to the negligence of the respondent, commences at about line 28 and goes through to the top of the next page. 

Your Honours will see that he said that she was responsible – this is about line 29 – that “as registered controller” – that is an expression, your Honours, which is a short way of describing registration under the regulations, and I will come to those in just a moment: 

as registered controller in the circumstances of this accident, she was, herself, negligent.  I am satisfied as registered controller she owed a duty of care to the passengers on this vessel, on this day. 

He said in the next paragraph: 

She had experience, over a number of years.  They invited a number of the people of board, not by any means all the people.  She knew, or should have known how many people were on board.  She should have known that the vessel was grossly and dangerously overloaded.  She should have taken steps as registered controller to ensure that the vessel did not leave the dock with that number of persons on board. 

Your Honours, the Court of Appeal expressed the view, which your Honours will see in the same volume at page 508, in three – I want to refer your Honours to three paragraphs which are at pages 508 and 509.  They are paragraphs 42, 43 and 45.  Now, your Honours will see that in paragraph 42, Justice Rolfe, whose reasons were those of the Court of Appeal, said:

In the light of Mr Warner’s de facto control, the fact that Mrs Warner may have invited some people, “not by any means all”, becomes irrelevant.  The duty to decide how many people should be on board was Mr Warner’s and, there was no evidence that Mrs Warner knew or ought to have known that the vessel was “grossly and dangerously overloaded”.  The fact that it was found that the vessel was so loaded does not prove that Mrs Warner either knew or ought to have known this was the situation.

It may be added that there was no evidence that the vessel behaved in any inappropriate way . . . until several minutes before the sinking.  Thus, not only was Mrs Warner not exercising de facto control of the vessel, but there was no evidence that she had the knowledge or ought to have had the knowledge his Honour attributed to her in the passage set out –

The reference should be to paragraph 13 of the reasons.  Could I just go back to those, your Honours?  Paragraph 13 is page 495.  The relevant part of it is page 495 and it is the last quotation in paragraph 13, halfway down the page, and that is the passage to which I adverted a moment ago.  Your Honours, if I can go back then to page 508, his Honour said, at the last three lines on that page:

The vessel having been loaded, nothing untoward happened until several minutes before the sinking such as to put her on notice of any problem.

And then your Honours will see in paragraph 45, having referred to the case based on the control, the registration in relation to the vessel, his Honour goes on to say:

This, with respect, is where his Honour’s finding of personal liability was flawed.

Your Honours will then see, halfway through the paragraph:

To make good the finding that she should not have allowed the vessel to sail with the number of people on board, the plaintiffs would have had to prove at the least that she knew, or ought to have known, that the vessel was overloaded, and that in that knowledge she could have done something to prevent the vessel from sailing.  This they failed to do.

If I could just say, your Honours, in the passages to which I have referred, both from the primary judge’s reasons and from the evidence – and could I interpolate to say, your Honours, and this is something I wish to mention in relation to the notice of contention, not all the evidence is here and not all the evidence was before the Court of Appeal because the issue sought to be raised by the notice of contention was not raised before the Court of Appeal.

KIRBY J:   You mean not all of the transcript of the trial?

MR JACKSON:   Indeed, your Honour, and not all the evidence – I mean that, your Honour, and I mean specifically in relation to the evidence of the expert witnesses, one of whom was preferred by the primary judge.  All that you have is what the judge said about the expert witnesses where he accepted the evidence of one of them.  Now, your Honours, I will come to the detail of it in a moment, but one just does not see the material that would be necessary to support setting aside those findings before the Court of Appeal and, your Honours, it is very difficult, with respect, to see how, on the material that was before the Court of Appeal and the passages to which I have referred your Honours, how the finding could be made that there was no evidence on which the judge could find that the vessel was not visibly overloaded; visibly in the sense that a person knowledgable in the area could see that and, of course ‑ ‑ ‑

KIRBY J:   Was that point made during argument, that the material that was placed before the court put limitations on what they could decide?

MR JACKSON:   Your Honour, in the Court of Appeal the position was, if I could put it shortly, that the issue that was raised there was the question of the existence of a duty.  Now, your Honours, may I just take a moment to deal perhaps with this question now, and I will do so as briefly as I can.  Your Honours will see the notice of appeal to the Court of Appeal in volume 2 at page 389.  Your Honours will see there the two grounds set out, that is, liability “for the negligent acts of the husband”, ground 1; negligence “as a result of her own acts or omissions”, that is the grounds there stated.  The submissions before the Court of Appeal, first in writing, can be seen at page 394 ‑ ‑ ‑

KIRBY J:   Just pausing there, although it might be open to objection as to lacking specificity, the second ground at least would raise issues such as duty of care, standard of care, breach of duty and causation, would it not?

MR JACKSON:   Your Honour, capable of doing so.  I would not disagree with that.

KIRBY J:   Yes.

MR JACKSON:   But, your Honour, when one goes then to the index of material before the Court of Appeal – and, your Honour, I am sorry to have to go to this detail in the matter – which is at 392 and 393, none of the evidence of the expert witnesses is set out there.  All that one has is the evidence of the people who were aboard the boat ‑ ‑ ‑

GLEESON CJ:   Going back to the notice of appeal on page 389, presumably the forensic purpose of the notice of contention is to force the argument back onto ground 1.  Presumably the point the notice of contention seeks to make is that if the speeding up of the vessel were the cause of the accident, that was something for which the husband was responsible, as a matter of fact I mean, and in which the respondent had no part to play and, therefore, her liability, if it existed, would be vicarious.

MR JACKSON:   Yes.  Your Honour, that argument, however, does not come to grips with the actual findings of the primary judge which would yet have to be set aside because it may well be that one is able to say there is one cause and there are two causes.  That was one of two cases but the way the primary judge dealt with it in accepting the evidence of Mr Bundschuh, was to the effect that the overloading was a cause and whilst it may be that the immediate cause was perhaps for the vessel to go a bit faster than it should have, or to put it rather more abruptly, the fact that it was a grossly overloaded vessel was itself a factor in the event having occurred.  So that, your Honours, there do not have to be - we only have to establish one causative event, a causative event.

CALLINAN J:   Mr Jackson, which particular of negligence do you say was made out against the respondent?  I am looking at pages 3 and 4?

MR JACKSON:   Yes, I think it is the first one, your Honour.

CALLINAN J:   Which is “Inviting and allowing to be present on the boat . . . an excessive amount of people”.

MR JACKSON:   Yes, your Honour, yes.

CALLINAN J:   Is there a finding on that particular?  I mean, do not worry with it now, but ‑ ‑ ‑

MR JACKSON:   Your Honour, it is encapsulated, I think, in the passage to which I referred the Court earlier and that is the passage that the Full Court then said there was no evidence to support.

GUMMOW J:   Well, the vice may be - the difficulty is in the word “allowing” in that particular.

MR JACKSON:   In the particular, your Honour?

GUMMOW J:   Yes, and in the finding at 366, line 45.

MR JACKSON:   I am sorry, your Honour, I did not catch the second part of what your Honour said to me.

GUMMOW J:   Page 366, line 45, “She should have taken steps . . . to ensure”.  What steps?

MR JACKSON:   Well, your Honour, to say the boat is not to leave and that is the point I am going to come to in just a moment, if I may?  Your Honours, could I stay with the notice of contention aspects for just a moment before going to that?  I took your Honours to the notice of appeal.  At pages 392 to 393 one sees the index to the Court of Appeal, none of the material from the expert witnesses was there.  One sees at pages 394 to 398 the written submissions in the Court of Appeal and on behalf of the present respondent.  The essence of them is contained in paragraph 17 at page 398. 

Our submissions in response, your Honours, follow and could I refer particularly to page 404, paragraphs 18 and 19 which draw attention to the findings that have been made and the transcript on the hearing in the Court of Appeal contains two passages which are relevant.  The first is at page 416 at about line 28 where Justice Handley - and this is elaborated upon a little later - said to my learned friend, “As I understand it you attack the premise, not the conclusion?”, and that that was referring to the question of duty appears from page 429 at about line 23 in a passage which goes to the bottom of the page:

what we’re really attacking is the finding upon the threshold point.

ROLFE AJA:  Do you mean if you fail on that you accept negligence?

HANDLEY JA:  You did answer me earlier by saying that you only challenged the premise not the conclusion.

Your Honours will see that goes to the bottom of the page.  Your Honours, the only reference to those findings to which I referred earlier, is when my learned friend, at one point, in response to a question from Justice Rolfe flirted with the idea.  That is at page 426 and your Honours will see at about line 26, the next sentence:

Mr Motbey, now that you’ve overcome that shock . . . That if I may say so seems to me to beg the question why should she have known that?  What was the evidence that indicated she should have known that?

MOTBEY:   We say there wasn’t any.

Your Honours, that is it.

GLEESON CJ:   If I could go back to page 398, paragraph 17.  Was the argument that whether the respondent was sought to be made personally responsible or vicariously responsible, either way, the factual premise on which such responsibility was based was her capacity to control the use of the vessel?

MR JACKSON:   Yes, your Honour.

GLEESON CJ:   And, the argument for the respondent, as I would understand it, is that, in fact, she had no capacity to control the use of the vessel and, therefore, the foundation for both personal and vicarious responsibility disappeared.

MR JACKSON:   Yes, your Honour, I think that is the argument that is sought be advanced, yes.  So, your Honours, if I could just say, our submission would be in relation to the notice of appeal that the issues sought to be raised by it about the cause of the accident should not now be allowed to be raised and not all the evidence is here or was before the Court of Appeal, for a start.

Your Honours, could I move, then, to the terms of the regulations, the Water Traffic Regulations.  Now, under regulation 2(3) of those regulations your Honours will see that a reference in them :

to a person who has the control of the vessel is a reference to a person who has the right to decide the position, disposition and use of the vessel.

So that is a definition provision, of course.  One then goes to Part III of the regulations and in particular to regulation 11, but your Honours will see – I suspect it will be page 12 of the copy that your Honours have.  Your Honours, by regulation 11(2), “A person” ‑ ‑ ‑

GLEESON CJ:   On page 17.

MR JACKSON:   I am sorry, your Honour, yes:

A person who controls a registrable vessel may apply to the Board for registration of such vessel.

GUMMOW J:   Now, what is there that makes requirement necessary and what penalty backs it up?

MR JACKSON:   Your Honour, it comes about from regulation 11(13)(a). 

If any registrable vessel is on any enclosed water –

I will take your Honours to the definition of that in a moment –

and is unregistered –

(i)  the owner of such vessel shall be guilty of an offence against this regulation; and

(ii)  the master –

is also.  Your Honours, if it does not have the identification plate, there is a subregulation (b):

both the owner and the master of such vessel shall be guilty of an offence –

and “enclosed water”, your Honour, is defined by regulation 2(1) to mean:

any port or any inland navigable water within the State of New South Wales.

GLEESON CJ:   Now, is it common ground that the respondent’s husband was the owner of this vessel?

MR JACKSON:   Yes, your Honour, that was the effect of the evidence.  Your Honours, “registrable vessel”, I should say, is defined by the same definition provisions and there is no doubt this was a registrable vessel.

GUMMOW J:   So, the existence of registration is, if one could put it this way, an answer to any alleged contravention of (13)(a)?

MR JACKSON:   Yes, your Honour.

GUMMOW J:   And an application to achieve that state of registration may be made by a person identified in regulation 11(2)?

MR JACKSON:   Yes, 2(3), your Honour, yes.

GUMMOW J:   Regulation 2(3), yes.

GLEESON CJ:   And, presumably, the making of such an application is an admission of the fact referred to in regulation 2(3). 

MR JACKSON:   That is what we would submit, your Honour, yes.  And also, regulation 11 makes no specific provision for any person other than a person who “controls” – if I could put that word in inverted commas – the vessel, to be able to apply for registration. 

GUMMOW J:   I am sorry, could you say that again, Mr Jackson? 

MR JACKSON:   I am sorry.  What I was seeking to say was this:  your Honours will see that regulation 11(2) uses the term “may” apply; the only person who is so qualified is a person who “controls”, which is the defined term.  But although the term “may” is used, no provision is made for any person other than a person who controls to apply. 

GLEESON CJ:   Was the application for registration in evidence? 

MR JACKSON:   Yes, it was, your Honour.  I do not know about the application; the registration certificate was, and I will give your Honour reference in just a moment, if I may. 

GLEESON CJ:   Would you mind checking on whether the application for registration was in evidence? 

MR JACKSON:   Yes, your Honour.  Your Honours, I was going to say then, one sees in regulation 11(3)(a) that the application for registration is to be “made in writing” to the Maritime Services Board, and for subregulation (4), “Upon the registration of a registrable vessel”, the Board causes to be issued both a certificate and a plate.  Under subregulation (5), the registration is effective for a year, but may be renewed annually.  Subregulation (6) says the holder of the certificate shall, amongst other things - the plate has to be affixed – that is (a); (b), whenever so required, produce the certificate to the authorised persons; notify changes of address; and so on. 

Your Honours will see subregulation (7):  if the holder of the certificate ceases to control the vessel – again, the defined term – he shall forthwith: 

supply to the Board the name and address of the person to whom control has been transferred –

and then, your Honour, paragraph (b):  a person who acquires control is to, within three days, forward the identification plate to the Board, et cetera.  Your Honours, could I then go to subregulation (9):  the registered vessel may be inspected or tested at any reasonable time by an officer of the Board, and the holder of the certificate is to make the vessel available for the purposes of the inspection or test when called on to do so.  The vessel can be cancelled for the reasons set out in subregulation (10)(a), including (iv):  where the Board considers the vessel unsafe to persons or property. 

GLEESON CJ:   Presumably, one reason why these regulations fasten on the aspect of control rather than ownership is that the ownership of a vessel may be distanced from its practical control, because of charter arrangements or finance arrangements. 

MR JACKSON:   Yes.  Your Honour, inevitably, one is talking about vessels that are being used in inland waters, but it may well be, as your Honour said, that, for example, a fleet of small vessels, ones that qualify as registrable vessels, may be ones that have a distant owner, in effect.  One might well see that. 

CALLINAN J:   What about a mortgagee?  I take it, it being an item of personal property, the legal title would be transferred to the mortgagee with a right of redemption.  Would the mortgagee be a controller?

MR JACKSON:   Your Honour, it depends a little on the immediacy of the right contemplated by regulation 2(3).

GUMMOW J:   Right against whom?

MR JACKSON:   Yes, your Honour, and that is an element of it, of course.

GUMMOW J:   Yes.

MR JACKSON:   But, your Honour, it may well be, if one took the case of the mortgagee then, as between the mortgagee and the person who is the mortgagor then, no doubt, the mortgagee would, assuming the terms of the mortgage permitted it, have the right to decide who would have the possession, disposition and use of it, but, in reality, the right to decide as between that person and other persons would be one that the mortgagee would have conferred on the mortgagor and, your Honour, it would be the mortgagor who relevantly, in those circumstances, would be the person having control, in our submission.

GLEESON CJ:   Well presumably, many of the vessels that ply in that waterways would be the subject of leasing arrangements.

MR JACKSON:   Yes.

GLEESON CJ:   Straight leasing or hire purchase?

MR JACKSON:   Your Honour, again, what I submitted a moment ago in relation to mortgagor and mortgagee, somewhat inexactly, would, no doubt, apply mutatis mutandis because the object of the arrangement would be to allow the lessee or hirer to be the person who possessed then the right to decide who was to have possession, disposition and use of the vessel.

GUMMOW J:   We are talking about legal right, are we?

MR JACKSON:   Yes, your Honour, yes.

GUMMOW J:   So that there is some wrong committed otherwise.

MR JACKSON:   I am sorry, your Honour.

GUMMOW J:   There is a wrong committed.  That is what backs up the right.

MR JACKSON:   Yes, your Honour.  One could have a situation, your Honour ‑ ‑ ‑

GUMMOW J:   If some conversion is committed.

MR JACKSON:   Yes.  Well, your Honour, it may be that one could say, in fact, that person did not have the right.  Perhaps it could be proved that they did not have the right.  The certificate might not be conclusive against the world, but it certainly would operate as an admission by a person who knows that they are registered as such that they are the person having control, et cetera, of the vessel.

CALLINAN J:   Mr Jackson, regulation 4 refers to a “master”.  Are there any other references in the regulations to “the master” of the vessel?  Now, I ask that to contrast, perhaps, the position of the person identified as a master as the person in control of the management of the vessel by contrast with a possible meaning of controller, as the person having some sort of proprietary right.

MR JACKSON:   Your Honour, “master” is used on a number of occasions.  One sees it, for example, in regulation 5 as well, but perhaps not as frequently as one might expect.  I do not think your Honours will find the term “master” very frequently.  One sees it, for example, in regulation 10(3), saying both, if there is not “a silencing device”, et cetera, then “the owner and the master” are “guilty of an offence”.

GLEESON CJ:   Though in regulation 7, if you use a water‑skiing vessel in an unorthodox manner, it is the mater of the vessel who is guilty of the offence.

MR JACKSON:   Yes.  Your Honour, there is a number of occasions – one sees it also in 11, 13(a)(ii), a provision to which I referred earlier, saying the master is “guilty of an offence” if it is not registered.

GLEESON CJ:   Is the expression “master” defined?

MR JACKSON:   No, your Honour.

GUMMOW J:   Well, were there any definitions in the Maritime Services Act that carried over?

MR JACKSON:   Your Honour, I do not think so; none that assists the Court in relation to this case.  In fact, the regulations are, for practical purposes, freestanding, your Honour.  Your Honours, I was dealing with regulation 11.  I was going to take your Honours to regulation 11(11), which creates an offence for a person:

who navigates a registered vessel, or who, having custody of the same, permits or suffers such vessel to be navigated, without the authority or consent of the holder of the certificate of registration for the vessel –

so that it makes it an offence to navigate or permit it to be navigated:

without the authority or consent of the holder of the certificate of registration –

Your Honours, I took your Honours to 11(13)(a), the requirement for registration, before.  The term “navigate” in regulation 11(11) seems to refer, in our submission, to the person actually in charge of the movement of the vessel.  I mention that because our learned friend’s submissions seem to give a rather narrow meaning to the term in regulation 11(11), but your Honours will see that it is used in what we would submit is the fairly ordinary meaning in a number of regulations.  Could I just give your Honours a reference to those?  Regulation 3(1); 3(2); 4, a reference to safe and proper navigation; in regulation 14(5F) and in regulation 15(2) and (3).

GLEESON CJ:   I am not sure I have understood the scheme of these regulations in so far as they require registration of a controller.  Regulation 11(13) is in aid of that scheme, but what is the object of the scheme?  Are there some responsibilities that attach to controllers?

MR JACKSON:   Well, your Honour, first of all, there is the requirement for registration so that there can be someone identified as being a person who has a relationship to a particular vessel.  Now, your Honour, that is putting it in very broad terms, of course.  The second thing about it is that that produces the system of registration of the vessels and allows the identification of the vessel by both the plate on it and by the certificate, which is required to be produced under subregulation (6).

Then, your Honours, one sees that the registration of the vessel can be cancelled, which means, of course, that it is unlawful to use the vessel, if one of the things set out in subregulation (10) appears, and that is that the information was “untrue”; “any requirement” of the regulations of the Board “has not been complied with”, and there are various other regulations that relate to vessels; if the vessel is noisy or “unsafe”; or “where the holder . . . ceases to, control the vessel”.  That is paragraph (v) of the same thing.  Now, your Honour, I do not know that I can take it beyond that.

GLEESON CJ:   But apart from having the responsibility of identifying yourself, if you are the controller, what other responsibilities attach to you as controller under these regulations?

MR JACKSON:   Well, your Honour, one is, and one needs to infer this from regulation 11(11), that the person who is the holder of the certificate of registration is the person who has the authority to say who may use the vessel, what persons may use the vessel, and your Honours will see that it is an offence to do so without the authority or consent of the holder of the certificate.  So that that means, your Honours, that people who are using vessels on inland waters are people who are the holders of the authority or consent of the person in relation to whom the vessel is registered.

Now, your Honours, if one took a situation where, say, there was a suggestion that a vessel was being used in inland waters to transfer a shipment of drugs, as sometimes happens; your Honours have seen some of those cases.  Now, if the vessel is registered, and it has to have the number, I think, painted on it, your Honours, from subregulation (12), it is possible to identify the vessel, who is in control of the vessel.  That person is someone to whom one can go immediately and say, “Who was operating the vessel at that time?”.  Your Honours, it is really a system in aid of not having, if I can put it that way, uncontrolled vessels going around the waterways.

GLEESON CJ:   But it does not take the extra step that you find in relation to motor vehicles, of making the registered owner, or registered controller, responsible for the conduct of whoever happens to be navigating the vessel at any given time.

MR JACKSON:   No, your Honour, it does not say that.  I accept that.  What one does have though, is a situation where - I am sorry, what it does bring about is a situation where it is possible to say that the probability is that in any circumstance the vessel is being operated by someone who is doing so with the authority and consent of that person.

GLEESON CJ:   What is the significance, in your argument, of the fact that the respondent was physically present on this vessel on the day in question?

MR JACKSON:   Because it gave her the opportunity, your Honour, to say, “The vessel is not to be used in this condition”.

GLEESON CJ:   So if, in fact, she had been away on holidays, simply not present on this occasion, what would the position then be?

MR JACKSON:   Well, your Honour, unless we were able to establish vicarious liability, vicarious liability applying in every circumstance, then the position would be she would not be liable.

GLEESON CJ:   That raises a question as to what is meant by “control”, does it not?  If the vicarious liability for which you contend depends, not merely on the kind of control that attracts the provisions of these regulations, but upon immediate physical presence and capacity to give directions, then it is a different kind of control that brings the liability.

MR JACKSON:   Your Honour, it is a question different from what though, your Honour, because the control that is spoken of in the regulation is that referred to in regulation 2(3), which is a term covering a number of possibilities and what I mean by that is to say, it is a reference to a right to decide, really, things falling within three concepts, one being ‑ ‑ ‑

GLEESON CJ:   But you would not lose that control if you went on an overseas holiday, would you?

MR JACKSON:   You would not lose the right to decide the possession or disposition of the vessel.  You would not lose the right to decide the use of it, your Honour, but in relation to the actual use of it the ability to exercise detailed power, of course, is unlikely to be actually present.  But one does not lose the right, your Honour, of course.

Now, your Honours, the regulations, as we have submitted, do not, in terms, say that the person navigating the vessel is doing so with the authority and consent of the person registered in respect of the vessel but, in our submission, they do raise a very strong inference that that is so and the primary judge, in our submission, was quite right in saying, as he did in the passage to which I have taken your Honours already, that having nominated herself as controller, she had a responsibility to exercise the power which she had and that her husband was navigating the vessel with her authority and consent.

GLEESON CJ:   I suppose one way of exercising control is always to say to somebody else, “I’ll leave it up to you”.

MR JACKSON:   Your Honour, that is one way of exercising control but if one is talking about negligence in the manner of exercise of control, that may not be a sufficient satisfaction of the duty that would exist.  But, your Honour, what we would submit also, in relation to that, is that if a person has a right to decide the use of the vessel and if that person is in a position where it should be obvious to that person that the vessel cannot be safely used, then, in our submission, the circumstances bring about a duty of the person to exercise the right to control which the person has.  It is not a rescue case, your Honour.

Your Honours, could I move from that to – could I take your Honours, for a moment, to our outline of argument?  What I wanted to go to, your Honours, was to paragraphs 28 and following, 28 to 32, dealing with the question of vicarious liability.

KIRBY J:   This is a true alternative, this case, is it not?

MR JACKSON:   Yes, it is, your Honour.

KIRBY J:   Does it relate into, in any way, the common law case and the assertion of personal responsibility?

MR JACKSON:   Well, your Honour, so far as the underlying facts, of course.  What we would say about ‑ ‑ ‑

KIRBY J:   I am just wondering whether the common law moulding to the statutory regime has anything to say in relation to personal liability by reference to the regulations.

MR JACKSON:   Well, your Honour, one cannot say, of course, that the regulations, in terms, say, as was the case in relation to motor vehicle regulations, that there is a deemed agency on the part of the person who is actually navigating the vessel.  But the regulations do speak in terms in, say, regulation 11(11), of there being authority and consent, or an assumption of authority and consent.  What we would submit is, as we seek to submit in those paragraphs, 28 to 32 – your Honours, I will not read them out, but in paragraph 29, in particular, we would submit the evident purpose of the regulation was to ensure that you could answer questions of who is responsible by pointing to the holder of the certificate, so that a person who is navigating the vessel is doing so on behalf of the owner of the certificate.

Your Honours, this is a case where there is, we would submit, a clearly defined statutory nexus between the person navigating the vessel and the person who has the right to control the vessel.  Your Honours, if one looks at Scott v Davis, this is a case where she was present and she had the ability to control, an ability not just given by some personal relationship, but given by virtue of the regulation.

GLEESON CJ:   Mr Jackson, in your submission, is the fact that the husband was the owner of the vessel irrelevant?

MR JACKSON:   Irrelevant, your Honour, yes.

GLEESON CJ:   He was at the wheel of the vessel or at the controls of the vessel, not in his capacity as owner, but in his capacity as the person permitted to be there by the registered controller.

MR JACKSON:   Yes, your Honour.

CALLINAN J:   But he was both the master and the owner?

MR JACKSON:   Yes, he was, your Honour, yes.  I think it would be right to describe him as the master, yes.

KIRBY J:   Did the evidence reveal why his wife was designated as the statutory officer?

MR JACKSON:   Your Honour, there seems to have been an intention to place the vessel in the name of a company in which she had the principal shareholding.  I think she had five, he had two, something of that kind, and she was then to be the registered controller but, for some reason, it did not actually go through.  Your Honour, I am putting that inexactly because I do not think the evidence was – I think the position was, at the end of the day, it was accepted that the result had not been effectuated and he became the owner.

GUMMOW J:   In a way the question is whether Mr Downes’ client was ever in a correct position to apply the registration.  It does not seem to be that she had any legal “right to decide the possession, disposition and use of the vessel”.  You have to say that, because by some mishap it was she who became the registered controller; all these legal consequences in tort flow from that statutory miscarriage.

MR JACKSON:   Well, your Honour, the position was, she knew and he knew for quite some time that she held that position in relation to the vessel.  It was not as if it was something that occurred without the knowledge of both the persons who were involved and it may well have been that the belief that they both held was one based on the assumption that the transactions that they had been contemplated had gone through.  So, your Honour, it is perhaps with respect overstating it to describe it as mishap and if necessary I can give your Honours the references to places where she accepted that she had known that she knew well before the accident that she was the person who had the ‑ ‑ ‑

GUMMOW J:   Yes, but is there any finding at any stage that, as a matter of general law, Mr Downes’ client answered the description of a person who had “the right to decide the possession, disposition and use of the vessel” owned by her husband?

MR JACKSON:   No, your Honour, there is not.  The finding is, she was the owner, but, equally, the finding is ‑ ‑ ‑

GUMMOW J:   He was the owner?

MR JACKSON:   I am sorry, I said the wrong thing.  The finding was that he was the owner, that was accepted, but that she was the person who, as between the two of them, was to be the registered controller.

GLEESON CJ:   I am not sure what that means exactly.  Was there a finding that there was a contractual or some other arrangement between Mr and Mrs Warner that produced the consequence that in law she had “the right to decide the possession, disposition and use of the vessel”?

MR JACKSON:   Your Honour, may I check that, but I think the answer is as I said before that the position was that the - your Honour will see, perhaps I could go to page 493 in volume 2.  I am referring to what was said in the Court of Appeal.  Perhaps if I go to page 492 paragraph 6, about line 30.  It was not contended by us in the Court of Appeal that the vessel was owned by the respondent, and it was conceded, as you will see from the bottom of the page, that that concession was not qualified, and as in paragraph 8 on page 493, your Honour will see that Justice Rolfe refers to the fact that “there was no evidence of . . . authorisation or consent”, and that, I think, is correct, and I think there was no particular finding by the primary judge in relation to that issue.  May I give your Honour a reference if there is one.

GLEESON CJ:   This is a fairly central question is it not, Mr Jackson?  I mean, I can understand an argument that says, the application for registration involved a certain admission or placed at least a tactical onus on whoever wanted to contend to the contrary, but there is an ultimate question, is there not, which has to be decided, which is whether, as a matter of fact and law, the respondent had “the right to decide the possession, disposition and use of the vessel” and the circumstance that the husband was the owner of the vessel is not obviously immaterial to that issue.

MR JACKSON:   Your Honour, it is not.  If one were looking to see an issue of who, in the abstract, as between the husband and wife, had rights in relation to the ownership, say, of the vessel, then the answer would be that the husband had those rights, but one is not speaking just about that.  What one is speaking about is a situation where, by the operation of the statutory provision, meaning the regulation, there has to be someone who is, for the purpose of the regulations, a person who is selected as having the characteristics referred to in regulation 2(3).

GLEESON CJ:   Let us suppose a family law dispute had arisen between Mr and Mrs Warner.  As I understand it, you are content to accept that the outcome of that dispute might well have been a conclusion that it was Mr Warner who had “the right to decide the possession, disposition and use of the vessel”.

MR JACKSON:   As between the two of them, yes, your Honour, and in those circumstances, an order might well have been made to the effect that the necessary steps be taken to ensure that she was, in effect, deregistered as controller and that he was substituted for her.

GLEESON CJ:   Then the question arises as to what are the consequences of these regulations in a circumstance such as the present where the wrong person has become registered as the controller of the vessel.

MR JACKSON:   Your Honour, could I say two things in relation to that?  Your Honour said “the wrong person”, but if the situation is that both the person who is the owner and the person who is the registered controller are agreed that one of them, not being the owner, is to be the person who is to be registered for that purpose, then, as between the two of them, the situation would be that the entitlement to be registered and to have whatever rights might flow from that is held by the person who is the one who is registered.

Now, your Honour, that could easily occur in circumstances where, for example, one person who was the owner of the vessel lived overseas and said to some other person, who was not the owner, “You’re the person who’s to have control of the vessel for the purposes of the regulations”, which would mean that if the overseas owner wanted to go on a holiday up the Hawkesbury or something on the vessel, they would be subject to the other person’s ‑ ‑ ‑

GLEESON CJ:   Let us suppose that, for reasons perhaps related to conduct of the kind that you described a little earlier, the owner of the vessel and the person who had “the right to decide the possession, disposition and use of the vessel”, wished to conceal his identity and wished to conceal his right, so he entered into an arrangement with an associate that the associate would apply to become the registered controller of the vessel.  What, if any, consequence would that have in relation to a person who was injured as a result of negligent navigation of the vessel by the owner?

MR JACKSON:   Your Honour, first of all, it would not, so far as the owner is concerned, make any difference, because there would be a direct right to sue the owner of the vessel, assuming the owner was directing the navigation of the vessel.  The next thing would be that it would have the consequence that the person who was registered as having control would also be liable.  I am speaking for the moment about vicarious liability.  If one is dealing with the case of personal liability, it would depend on the involvement in the event. 

GLEESON CJ:   Put personal liability to one side.  Would the vicarious liability be upon the basis that the associate, contrary to the true fact, had “the right to decide the possession, disposition and use” of the vehicle? 

MR JACKSON:   Yes.  Your Honour, when one says “contrary to the true fact”, there are shades in these things ‑ ‑ ‑

GLEESON CJ:   I was postulating a corrupt, perhaps even criminal, arrangement between the owner and an associate of the owner, under which it would be falsely represented to the authorities that it was the associate who had “the right to decide the possession, disposition and use of the vessel”. 

MR JACKSON:   Your Honour, I suppose there are two possibilities, really.  One is that one treats the thing as a sham in toto, in which a registration would have been, I suppose, falsely acquired, and could be expunged.  But, your Honour, the other would be that the situation is one where, despite the fact that the bargain is itself corrupt, an element of it is that the person who is the owner and the person who has become registered have agreed to do that thing, with whatever consequences may follow from it.

If the result be that both would be liable, so be it, your Honour, but all that is being done is to identify the person who has the right to decide, and if a person who has the right to decide is a person whom the owner says has the right to decide, then that person has the right to decide until the owner withdraws their permission. 

I was going to give your Honour a reference.  I think it was at page 365 in the reasons of the primary judge.  Your Honours will see, at about line 32, his Honour said: 

The evidence of ownership comes from the Warners.  I believe it establishes that Mr Warner purchased the vessel, he looked after the vessel, was basically in control of making all the relevant decisions. 

Your Honours will see, then, the next two paragraphs. 

GUMMOW J:   The judge seems to be saying, at the bottom of 365, that somehow she held herself out. 

MR JACKSON:   Your Honour, by allowing herself to become the registered controller? 

GUMMOW J:   Yes. 

MR JACKSON:   Inevitably, there is a holding out, your Honour, the holding out that one says one is the person who is qualified to be registered. 

GLEESON CJ:   But there is a change of subject matter between the first and the second sentences of the paragraph beginning on the bottom of 365.  The first sentence talks in terms of responsibility flying from the fact that she has allowed something to happen and the second sentence looks like a proposition of fact.

MR JACKSON:   Well, your Honour, it is between a proposition of law and a proposition of fact.  The paragraph ends with one of fact and starts off with one of law and he is speaking in the first sentence about responsibility and the second is in relation to control, and perhaps that is a question of fact, but, in any event, your Honour, what we would submit is that she does have a degree of control.  This is not a case where her husband did not assent to her having this role.

GLEESON CJ:   Do you mean she got a degree of control by the fact of registration.

MR JACKSON:   Yes.

GAUDRON J:   Or by her husband’s assenting to her becoming registration.  It perhaps does not matter.

MR JACKSON:   Yes.  Your Honour, by her becoming registered in circumstances where he knew of that fact.  Your Honour, if I could put it this way, assume one had four people who were business people, professional people, workers, whatever one likes, who liked being on boats but none of them was any good on boats; they acquired a vessel but in relation to it they got a person who was experienced in boats and said, “This person is to be the person registered in respect of the boat.  That is the person who knows something about it and that person is the one who will be registered”.

There is no reason why they could not do that and there is no reason, in our submission, why in relation to them if, let us say, one of the four of the most minimal competence was in fact navigating the boat with aboard there being the person who was registered in respect of it, there is no reason why that person would not have the power to say, “Don’t do it.  You’re

going too fast” in circumstances where it would be dangerous to go so fast.  Your Honour asked me about the application for the registration.

GLEESON CJ:   Yes.

MR JACKSON:   The document does not seem to be in the material before the Court.  Some documents that were before the primary judge are between pages 310 and 320 in volume 2.  I am not able to tell your Honour, now, whether before the primary judge the documents that were there included the application for registration but may we check that?

GLEESON CJ:   A related question may be whether there is some kind of prescribed form of application.

MR JACKSON:   Yes, your Honour.  I think there is a form but whether it is a prescribed one is another question.  Your Honours, those are our submissions.

GLEESON CJ:   Yes, thank you, Mr Jackson.  Yes, Mr Downes.

MR DOWNES:   Your Honours, at the very heart of this case is the regulation and an analysis of what it provides, perhaps one might say the proper characterisation of the regulation.  The significance of it can be seen in the way the appellant’s written submissions were prepared and in particular I note, for example, what is said in paragraph 33 of the written submissions which show that not only in the way the appellants seek to run their appeal is the proper characterisation of the regulations central but, more particularly, it is subregulation (11) itself which is critical.  What they say in paragraph 33(b) is that:

By applying for, obtaining and retaining the certification of registration Mrs Warner . . . 

(b) acquired the degree of control over the vessel conferred by reg.11(11).

Now we take issue with that characterisation of the regulations and in aid of the submissions which we put about the effect of the regulations, there are a number of short propositions which, as we see it, are uncontrovertible in the sense that they are the mere description of what is the operation of the regulations, which inevitably lead to a result which is fatal to both arms of the appeal.

The propositions are as follows.  One, regulation 11 does not, in terms, confer any rights of control.  There is nothing there which purports to confer rights of control,.  In that respect, of course, the regulations are to be distinguished, for example, from the scheme that one sees in, for example, Soblusky v Egan and still even today, in which there is some actual deeming of control or in which there is the conferring of control.  No such right appears here.

Secondly, the regulations recognise that the holder of a certificate of registration may not, in fact, have control and that is because in subregulation (10) that my learned friend took your Honours to, there is provision for the cancellation of a registration where the holder of the certificate is not, in fact, the person in control.  So our second proposition is that the regulation recognises that the holder of a certificate may not have control.

Thirdly, the regulation recognises that entitlement to control, far from coming from within the regulation, comes from outside the regulations, and that is because of the definition in regulation 2(3), to which my learned friends have taken your Honours and which is the definition which refers to the:

person who has the right to decide the possession, disposition and use of the vessel.

Nothing suggests that that right is in some way associated with the regulations themselves.  It is a right which comes from the rights, per se, between the relevant parties.

CALLINAN J:   Mr Downes, is there any provision for insurance, the statutory, compulsory ‑ ‑ ‑

MR DOWNES:   No, there was no scheme.  No, your Honour.

CALLINAN J:   Not under these regulations, but under any other Act or regulations?

MR DOWNES:   Not that I am aware of, your Honour.

GUMMOW J:   These are not treated as notional motor vehicles under the other scheme?

MR DOWNES:   No.  Well, I do say, advisedly, not that I am aware of, your Honour.

GUMMOW J:   All sorts of things ‑ ‑ ‑

MR DOWNES:   I have not made an exhaustive inquiry and I am not in a position personally to know the situation in New South Wales in that regard, but I am not aware of any.

CALLINAN J:   In some States, I know there is a similar statutory scheme with respect to boats.

MR DOWNES:   Yes.

CALLINAN J:   It might be relevant, might it not, that the extended concept of vicarious liability is usually tied up with quite an elaborate compulsory insurance scheme which does not exist here?

MR DOWNES:   All I can say is, your Honour, that if there be such a scheme, it has never formed any part of any aspect of this case.  I think the reality is there is - I mean, I can go this far, there is no compulsory insurance scheme in place.

GLEESON CJ:   Do these regulations apply to ordinary sailing craft?

MR DOWNES:   I think for a yacht it has to be of either a particular displacement, in other words, a large yacht or a particular length.  I think so far as vessels is concerned, similar considerations - of motor vessels - apply but there is, of course, no issue but that this particular vessel, because it was a very large vessel, was a registrable vessel.

GLEESON CJ:   No, I was just interested to know to how many varieties of vessel these regulations would apply.

MR DOWNES:   Well, I think there is a speed provision so far as motor vessels are concerned.  From memory, something like 9 knots, or something of that sort, vessels not capable of doing more than 9 knots do not need to be registered.  So small sailing vessels with auxiliary motors that can only push them along at a few knots would not be required to be registrable.

GLEESON CJ:   But those large sailing vessels that you see moored down near Rushcutters Bay, for example, most of them would be covered by this scheme, would they?

MR DOWNES:   I suspect they would be, but I cannot go further than that, your Honour.  I do know there is a provision in the regulations relating to length of sailing vessels.  Your Honours, I think I had got to the fourth proposition which is, perhaps, associated with the third, that is, that nothing in the regulations either purports to or achieves the result of transferring ownership or any power of disposition from that which actually obtains.

GAUDRON J:   What do you mean by that “which actually obtains”?  You are assuming, are you not, in that proposition that legal ownership is the be‑all and end‑all, whereas one has to assume, surely, in this case, that apart from legal ownership there was some agreement between the husband and the wife.

MR DOWNES:   Well, no such case has ever either been put ‑ ‑ ‑

GAUDRON J:   Well, the alternative is sham and I should have thought if it was - a sham case was to be run, it was up to the husband and the wife to do so.

MR DOWNES:   Your Honour, what I content myself with is what were the findings below and that particular passage that your Honours have just been referred to, which is one of a number of passages in the judgment of the trial judge relating not just to ownership, but to control itself.

GAUDRON J:   Where do I find that?

MR DOWNES:   The particular passage is at 365, line 32:

The evidence of ownership comes from the Warners.  I believe it establishes that Mr Warner purchased this vessel, he looked after the vessel, was basically in control -

that is his Honour’s word -

of making all the relevant decisions.

Now, that is only one of a number of similar findings.  It may be convenient at this point to take your Honours to them.

GAUDRON J:   But all that means, in effect, does it not, is that having reached some agreement, the wife was content to leave the decisions to her husband, does it not?  She exercised her method of control by saying, “I will leave it to you”.

MR DOWNES:   But, your Honour, no agreement was ever ‑ ‑ ‑

GAUDRON J:   Otherwise we are looking at a sham, are we not?

MR DOWNES:   Well, if your Honour wishes to use that word to characterise the circumstance, then so be it, but there is no evidence of any agreement.

GAUDRON J:   But there was no case made by you that it was a sham.

MR DOWNES:   Well, with respect, your Honour, it was not necessary for my client to make such a case to achieve the result that presently is obtained.

GAUDRON J:   Well, that is the question, is it not?  That really is one of the questions in this appeal.

MR DOWNES:   Well, the question, your Honour, as we would see it, is, “What was the factual position associated with the control of this vessel?”.

GAUDRON J:   No.  One cannot ask that question in isolation from the legal position, can one?

MR DOWNES:   No, I agree with that.

GAUDRON J:   Indeed, I might have thought, unless one had notions rooted in the last century, that one might think in actual fact this wife did have some means of at least attempting to alter the situation, and when you add to that, the regulation, you have ‑ ‑ ‑

MR DOWNES:   Well, your Honour, the thrust of the argument that I seek to put is associated with the positive findings of the judge as to who was in control, and I am entitled, I would respectfully submit, to rely upon ‑ ‑ ‑

GAUDRON J:   Yes.  But I do not understand what that means.

GLEESON CJ:   And an alarm bell rings when somebody starts using words like “basically”.  People use words like “basically” usually because they are not prepared to put the proposition omitting those words.

MR DOWNES:   Well, can I take your Honours to the other passages?

GLEESON CJ:   Yes.

MR DOWNES:   The first of them is at page 349 line 42:

The vessel was 36 feet in length and had a fly bridge.  The person who was in control of the vessel was Dennis Warner.

GAUDRON J:   Yes, but as it said, the person who had the right to control the vessel.

MR DOWNES:   Page 357 line 44:

In my view the simple part of this case is the claim against Dennis Warner.  The claim on behalf of each of the plaintiffs was that he allowed far too many people to travel on this vessel and once the vessel veered to the left, it was inevitable –

et cetera.

GLEESON CJ:   But, Mr Downes, coming back to 349 line 42, that is a reference to the position on 8 January 1990 and I would have thought his Honour is clearly using the word “control” there in reference to the person who is directly in charge of the navigation of the vessel.

MR DOWNES:   Yes, your Honour.  Well, I simply seek to make good the proposition that he was the owner and, more than that, he was the person who made the decisions and, more than that, there was never any situation in which Mrs Warner gave him consent, authorised him to do anything at all.  He always assumed the control to which his ownership primarily entitled him and with respect to which nothing in the evidence qualified.

GAUDRON J:   But that may not be the question, Mr Downes.  The question may be, “Was she in a position to do anything?”, and from that the question may then be, “What was she in a position to do and did that impose a duty of care on her?”.

MR DOWNES:   But the way the case is being put, your Honours, if I can put it this way – and what I am primarily meeting is the case put against me ‑ is, as I sought to point out at the outset, that it begins with an acceptance of the proposition that one has to show that she had some actual control that she could have exercised. 

GAUDRON J:   A right to control is perhaps what we are looking for.  Not actual; a right to control in some way. 

MR DOWNES:   All right.  Well, I mean in the sense that the person who was the object of her power might reject her approach. 

GLEESON CJ:   A problem, Mr Downes, is that there is an ambiguity in the concept of control.  Let it be supposed – and I am not suggesting this is the case – that Mrs Warner did not know how to operate a vessel like this, but that, nevertheless, by agreement between herself and her husband, she was the person who had the right of the kind described in regulation 2(3).  On that assumption, Mrs Warner would not have been able herself to seize the controls of the vessel from her husband and assume its navigation.  She would not have had the physical or mechanical capacity to control the vessel, because she did not know how to operate it.  But on that assumption, she would have had the right to say to her husband, “You may not leave the wharf.  This vessel may not depart from the wharf until half these people get off.”  It is a right of the second kind that we are talking about, not a physical capacity of the former kind. 

A.  I wouldn’t have said they were significant but she had responsibilities.

At the bottom of the page he was asked:

Q.  Well what did you think registration was?

A.  Purely that.  That there was a name required for the service of notices and to have a party in who’s name the vessel would be registered.

Then, your Honours, about line 15 on page 220, he referred to the fact that he had been a Deputy Registrar of the Land Titles and said:

I was very familiar with property title and knew the consequences of registration –

He:

was also aware that registration of either a vessel or of a vehicle had nothing to do with ownership.

And then at the bottom of the page he was asked:

Q.  Don’t you think that whoever becomes registered in relation to a boat ought to know what that entails?

A.  I would have thought there would be some third property –

“party” I think the word must be –

or injury compensation involved in that, it has with a vehicle.

Your Honours will see that goes down to page 221, about line 15.  At page 249 in a passage that goes from about line 15 through to page 250, about line 18, he referred to the fact that one of the objects, in fact, was to keep all of his “assets at arm’s length”.  That is at page 249, about line 37.

GAUDRON J:   What does that mean?  Is that further elaborate it?

MR JACKSON:   I am sorry, your Honour, what ‑ ‑ ‑

GAUDRON J:   “At arm’s length”.  Is that ‑ ‑ ‑

MR JACKSON:   What he seems to be suggesting - and you can see this, for example, between lines 18 and 22 - he wanted to keep the purchase:

isolated from the other companies that were involved in risk transactions.

They were involved in land development.  Your Honours, one then sees at the top of page 250 in a passage that goes from the top to about line 15:

It was a family asset.

Then between lines 35 and 40, the only reason it was not included as an asset of the company was:

that it is an oversight on the part of the accountants.

Your Honours, finally, on this aspect, the respondent knew that it was in her name.  That appears at page 147.  Your Honours, that is between lines 15 and 25.

GLEESON CJ:   Now, the trial judge’s conclusion that Mr Warner was the owner of the vessel was presumably based upon the fact that he paid for it?

MR JACKSON:   Yes, your Honour.

GLEESON CJ:   He apparently paid for it with the intention that the company should be the owner of it.

MR JACKSON:   Yes.  Your Honour, when I say he paid for it, some of the cheques actually came from the company.  But, your Honour, the issue is one that in a sense, I suppose, went away, at least in the Court of Appeal because our side in the Court of Appeal said it was accepted that he was the owner.

GLEESON CJ:   On one possible point of view, that also may bring to an end the issue of vicarious liability because it would be a rather unusual situation that somebody is vicariously responsible for the negligence of a person who is both the owner and master of the vessel.

MR JACKSON:   Well, that depends, your Honour, in the sense that one is not in a situation where the issue is purely one of owner and master.  The regulations do provide for, possibly, a third person to have an involvement and that person to have, at the least, a power of veto in relation to what use is made of the vessel.

CALLINAN J:   I suppose you say, in a sense, that the fact that she applied for the certificate involves an admission against interests that she was a controller, in a real sense.

MR JACKSON:   Yes, your Honour, that she had the powers contemplated by control.  Your Honour, although the factual finding in the end, or the factual assumption, was that he was the owner, when she was interviewed by Detective Coffee – and this is both discussed in the evidence and your Honours will see it set out in an exhibit; I will give your Honours a reference to it in a moment – she said, in effect, “I am the owner”, but it is clear enough in the context she was speaking of treating herself as the registered owner.  Your Honours will see that in volume 2 at page 325 and following.  I will not go to the detail of it now.  But, your Honour, what your Honour puts to me is right.

CALLINAN J:   Well, you are better if she is the controller than you are if she is merely the owner.

MR JACKSON:   Indeed, your Honour, yes, because what the regulations provide for is a situation where it is an offence for the vessel to be used contrary to her dictates, to put it shortly.

CALLINAN J:   Well, is that right?  I mean, I just wonder whether, if any registrable vessel is unregistered, it is the owner and the master who are guilty of an offence.

MR JACKSON:   Your Honour, in those circumstances, there is ex hypothesi no controller.  There only comes into being such a person, in a sense, by the registration. 

CALLINAN J:   Which really rather suggests that they are the people who are responsible for registration, because they are the obvious controllers. 

MR JACKSON:   I am sorry, your Honour, with respect, but that is one reason.  Obviously, they are the people closest to the vessel.  One owns it and one is a person sailing it.  What is proscribed is sailing a vessel which is not registered, and they are the people involved.  One of the objects, of course, is then to have a person who will be the controller, the nominated or registered controller.  It is not a phrase appearing in the Act, but it is ‑ ‑ ‑

CALLINAN J:   If the word “control” were not used, or “controller”, and the word “nominee” was used, you would have a much weaker case. 

MR JACKSON:   It may well be, but could I just say, your Honour, in relation to it, that the expression “registered controller” is a term used for brevity.  One keeps seeing it ‑ ‑ ‑

CALLINAN J:   I mean, your stronger point is really the introductory words to subregulation (2), “A person who controls a registrable vessel”, the use of the verb “controls”.

MR JACKSON:   I am sorry, your Honour.  Your Honour was looking at regulation ‑ ‑ ‑

CALLINAN J:   I was looking at regulation 11(3)(2), I am sorry – no, 11(2), I beg your pardon, 11(2).

MR JACKSON:   Yes, your Honour, but, of course, “control” being necessarily the defined term and “control” meaning “the right to decide the possession, disposition and use”, and when one comes then to regulation 11(11), the expression “use”, I think, appears in that.  Could I just go then to the question of – your Honour the Chief Justice, I think, asked a question about registrable vessels and sailing vessels.  The definition of “registrable vessel” in the regulations defines some sailing vessels over a particular size as being registrable vessels. 

Your Honours, I have referred already to my learned friend’s submission about the ability to cancel registration.  Could I invite your Honours, in that regard, to go as well to our submissions in reply and could we refer, particularly, in that regard, to paragraphs 4 and 5 of those submissions which deal, in a sense, with that issue?  I will not take your Honours through the detail of our reply submissions.  They deal with a number of matters referred to by our learned friends.  May we invite your Honours to read them in due course.  Could I say three further things?  One is in relation to the provisions of the Act itself and your Honour Justice Callinan referred, I think, to section 13YA ‑ ‑ ‑

CALLINAN J:   I was looking at the 1997 reprint, I have since discovered, Mr Jackson.  I do not know whether the Act in force at the time was the same.

MR JACKSON:   Your Honour, some of the provisions were, I think.  Section 13YA, which is a provision dealing with damage to property - your Honour, that is a provision that has its origins, I think, in the Merchant Shipping Amendment Act 1900 or 1901, or something of that kind, but it was a provision which was designed to place an absolute liability, or a strict liability, I should say, on the owners of vessels whose vessels damage port installations in various parts of the world and it is the second part of it that then gives liability on the part of the person in charge of the vessel, the master of the vessel, if the master is actually negligent.  Your Honours, it is a provision which has some historical background to it.  It is, your Honours, I think, dealt with in one of these cases in this Court, but I just ‑ ‑ ‑

GUMMOW J:   It is referred to in Scott v Davis.

MR JACKSON:   Yes, the particular case eludes me for a moment.  It is a provision that the Merchant Shipping Act provision has now gone with the Commonwealth legislation.

But your Honours will see in relation to the regulation‑making provision that there are regulations in broad terms.  Could I refer, for example, to sections 38(2)(f), 38(2)(fi), 38(3)(b) and 38(3)(h).  There is, I think one of your Honours observed, a reference to the person in control of the vessel, though not in a defined sense, in section 34(1)(g).  Your Honours, that is the first matter.

The second matter is in relation to our learned friend’s notice of contention.  Your Honours, we have, I think, in the course of the submissions I have made, really dealt with all the matters I wanted to say in relation to the notice of contention, except this, and that is, if one looks at it in summary, it is a curious situation if one is able to rely in the Court on a point which has not been dealt with at all in the Court of Appeal because the issue is one which was not raised in the Court of Appeal by an appellant in that court.

Now, your Honours, the last thing I wanted to say was that we had foreshadowed in our written submissions that if there was any doubt about our ability to raise one point we would seek leave to amend the notice of appeal.  Could I give your Honours copies of a draft in that regard which sets out what we would seek?

GLEESON CJ:   Thank you.

GUMMOW J:   The case is Oceanic Crest 160 CLR 626, I think, Mr Jackson.

MR JACKSON:   Thank you, your Honour.  That is the amendment, your Honours, which is foreshadowed in our outline of argument in paragraph 22.

GLEESON CJ:   Yes, thank you, Mr Jackson.

MR JACKSON:   Those are our submissions.

GLEESON CJ:   We will reserve our decision in this matter and we will adjourn.

AT 3.34 PM THE MATTER WAS ADJOURNED