Frost v Amaca Pty Ltd

[2006] HCATrans 675

[2006] HCATrans 675

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S252 of 2006

B e t w e e n -

BERNARD GEORGE FROST

Applicant

and

AMACA PTY LTD

Respondent

Application for special leave to appeal

GLEESON CJ
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 8 DECEMBER 2006, AT 10.31 AM

Copyright in the High Court of Australia

MR G.F. LITTLE, SC:   May it please the Court, I appear with my learned friend, MR D.C. MORGAN, for the applicant.  (instructed by Turner Freeman)

MR S.G. FINCH, SC:   If the Court pleases, I appear with my learned friend, MR D.E. GRAHAM, for the respondent.  (instructed by Allens Arthur Robinson)

GLEESON CJ:   Yes, Mr Little.

MR LITTLE:   Your Honours, we say this application is a matter of public or general importance and we say that for a number of reasons.  The first is that the question of the appropriate law to be applied to determine a product liability case has been a vexed question that was left for future consideration by the Privy Council as long ago as 1971.  It was certainly touched on by your Honours when considering defamation in Dow Jones v Gutnick and it now seems to have been postulated as a test by the Court of Appeal in this case as a test involving a determination of to where the conduct was directed.

GLEESON CJ:   Your primary task might be to persuade us that there are sufficient reasons to doubt the correctness of the decision of the Court of Appeal to grant special leave.

MR LITTLE:   We would submit, your Honour, that the Court of Appeal rely on a transcript of a special leave application in an earlier case of Putt.  We are aware of the embargo on the use of transcripts, but the Court of Appeal have in fact relied on it and our learned friends have also relied on it.

The case of Putt where your Honour presided with Justice Gaudron was a case, in our submission, when one looks at the transcript, that turned utterly and totally on the nature of the pleadings and the way in which the case was presented.  It was presented as a liability of an Australian company which had a subsidiary which breached duties that were owed in New Zealand.  It was not, in our submission, a products liability case.

In the present case this is purely and simply a products liability case and it has the singular benefit, in our submission, in this case that the breaches of duty are all admitted and clearly stated and, although the Court of Appeal confined themselves to the two that the trial judge confined himself to, in our submission, every one of the breaches of duty that were pleaded were pleaded as being breached in New South Wales.

The Court of Appeal, in our submission, has directed its attention specifically to where the conduct had its effect, namely New Zealand.  We say that is contrary to the remarks of this Court, perhaps obiter as they may be said to be in relation to products liability in Dow Jones v Gutnick.  We say it is also contrary to what we inferentially say is the view of the Privy Council expressed when dealing with the jurisdictional issue in Distillers. 

So we say that the effect of the Court of Appeal decision is that a present day Australian manufacturer could dump dangerous material still on the New Zealand market without any risk of incurring liability if it did damage there.  If it went on from New Zealand to Fiji, for instance, which has a normal common law system, the liability would then attach for injuries caused in Fiji.

Perhaps if one looks at it in the context of the circumstances of Zhang and changes them to fit the circumstances of this case, if General Motors Holden manufacture a Holden at Fishermens Bend in Victoria and export it to New Zealand or it is bought by Avis or Hertz, for instance, and a resident of Victoria goes to New Zealand fishing or skiing, hires this car, the suspension drops out of it when it is brand new and smashes into a tree, he will have cover under the New Zealand Act.  We would submit that it would be contrary to law in policy to say that when he comes back to Victoria as a quadriplegic, he cannot sue General Motors for the simple reason that the car that he had with the suspension falling out happened to be in New Zealand at the time. 

We say that is fortuitous and we say that the example given by the Privy Council in Distillers about somebody buying Distaval in Australia, taking it in South Africa and saying that because you took it in South Africa and that is where it caused the harm, South African courts would have jurisdiction rather than some other jurisdiction, shows that that is not the appropriate test to apply.

GLEESON CJ:   What do you say the test is?

MR LITTLE:   We say the test is where the defendant acted.  The defendant in this case only ever acted in New South Wales.

GLEESON CJ:   That depends on the identification of the relevant Act.

MR LITTLE:   True, your Honour, and we say all the Acts ‑ ‑ ‑

GLEESON CJ:   If I manufacture a product in New South Wales intending to export it to New Zealand and it is exported to and supplied in New Zealand and then used in New Zealand by a resident of New Zealand and causes harm to the resident of New Zealand, what is the relevant act?

MR LITTLE:   We say the relevant act in this case where it is an inherently dangerous article is in its manufacture by putting a toxic substance that cannot be used safely into the article at the time of manufacture.

GLEESON CJ:   Is there a difference between an inherently dangerous article and a defective article?

MR LITTLE:   We say there is only to this extent, your Honour, that an inherently dangerous article cannot be made safe by warning, whereas a defective article may be able to be.  We say that once it is on the market and it is known to be, as it is now known to be, too dangerous to be used, the breach of duty is in manufacturing it and putting it on the market at all.  The agreed facts were that this article was supplied by Amaca from New South Wales directly or indirectly to the company in New Zealand.  It was admitted that the company had no presence in New Zealand, no employees, and by inference ‑ ‑ ‑

GLEESON CJ:   Amaca, you mean?

MR LITTLE:   Amaca, yes, or James Hardie, the predecessor to Amaca - and no means of discharging its duty there.  The only place it could discharge its duty was in New South Wales by substituting non‑toxic materials for the toxic, alternatively, providing advice or warnings in a way here when it was packaged that may have brought it to the attention of end users wherever.

We say that the evidence in this case on the admitted facts is simply that it went on a market in New South Wales.  It could have gone to anywhere in Australia or New Zealand.  It was not directed specifically to New Zealand but it is agreed that it was supplied from New South Wales to New Zealand, the particular material that the plaintiff was exposed to.

So we say, in our submission, that for certainty in this area of the law, one must look to the place where the defendants acts, whereas the Court of Appeal have taken the view that it is where the consequences of the act are suffered, which in effect means it is a place where the plaintiff has acted to its detriment which is picked as the place which locates the tort, because that was New Zealand.

That is as fortuitous, we say, as the example given by the Privy Council as if the Distaval had been inhaled in South Africa, purely fortuitous.  It is suggested by our learned friends in answer to our proposition that this would render residents of this country unable to recover for defective products imported here from overseas.

GUMMOW J:   Distillers would be a good example, would it not?

MR LITTLE:   Distillers would be a good example, your Honour, except modern trade practices legislation has taken account of that and provided ‑ ‑ ‑

GUMMOW J:   The thalidomide litigation was a great subject of debate back in the 60s and 70s.

MR LITTLE:   It was, your Honour, but the law has moved on from then, in our submission, and trade practices law now provides that the importer stands in the shoes of the manufacturer so that for a defective article imported into Australia the importer is sued as though he manufactured the article.

We say nothing turns on whether it is defective or inherently dangerous except – and we accept, of course, that Burnie Port Authority has removed the distinctions between articles dangerous in themselves, Rylands v Fletcher and the like, subsumed them all into the normal laws of negligence.  But we say notwithstanding that, where an article is dangerous in itself, the duty must exist and be breached at the time when it is put on the open marketplace so that it can be sent to wherever to a purchaser who is ultimately affected by it.

We say that is the only act the defendant does, the only act in this case the defendant could do, its only operation.  Its only employees were in Australia.  It had no power to discharge its duty in New Zealand.  We say that it is on all fours with the case of the Holden which is manufactured in Victoria which injures a Victorian.

GLEESON CJ:   Was Amaca the manufacturer or the supplier of the product, or both?

MR LITTLE:   Both, your Honour.  Manufactured and supplied and our allegations went to both – breaches of both - of the duty existing in both ways.

GLEESON CJ:   Where in Australia was the manufacture?

MR LITTLE:   At Camellia in New South Wales.  It leads to the subsidiary point, your Honour, which is the effect of the New Zealand statute.  This Court in Zhang left open, as the Privy Council left open in Distillers, the question of how one would regard limits and the extent of damages in a foreign forum when applying that foreign law in Australia.  So we say that is a second question that is still open to be determined and this case is an ideal vehicle for that.

We say that for this reason, neither the trial judge nor the Court of Appeal accepted that the cause of action still existed in New Zealand.  However, we relied on and we still rely on today authority of the New Zealand Court of Appeal in the judgment which is in our list of authorities of Donselaar v Donselaar where three judges of the Court of Appeal in New Zealand in careful separate judgments have said for exemplary damages to subsist there they must be engrafted on an existing cause of action so that although the right to claim compensatory damages for personal injury has gone there is still a cause of action for battery or assault and the like.

So that we say that the cause of action has not been extinguished, it is alive still.  Amaca operated in New South Wales.  This is clearly the place with jurisdiction to try an action against them.  They are regularly served with the proceedings here, and in this case they were regularly served with the proceedings by a person who first suffered his sufficient damage to be able to sue on a resident of Queensland.

GLEESON CJ:   There is no question of jurisdiction in this case.

MR LITTLE:   No, there is no question, but we say that the other cases have all been the converse.  They have all been long‑arm jurisdiction arguments as to whether a court here should be exercising jurisdiction over a foreign defendant.  In this case we have the defendant here.  This is the appropriate place to sue the defendant and we say once you sue that defendant it is not for it to say, “Well, fortuitously, part of the product we manufactured ended up in New Zealand so we have no liability in respect of injury it caused there”.

It may be that a plaintiff may have been working as a backpacker in university student holidays was exposed to Amaca’s product in New Zealand, comes back here, suffers mesothelioma 40 or 50 years later.  Does the law say he is debarred from suing because he has cover under the New Zealand Act, which he would have.  Because his injury was suffered in New Zealand he is entitled to cover.

To perhaps extend the point involving the Holden car, if one drives the Holden from Avis and is struck by somebody driving on the wrong side of the road one would be entitled to cover there but there would be no cause of action.  That would be a domestic New Zealand accident clearly within the bar in that country.  We say the circumstances of this case have a far, far stronger Australian connection or connotation than they do ‑ ‑ ‑

GUMMOW J:   That sounds like a proper law of the tort debate, really, which we have turned our face against.

MR LITTLE:   Your honours have in Dow Jones said one must concentrate on the act of the defendant and the act of the defendant must surely be either manufacturing in the way it has or putting it on the market in the dangerous situation it was in.

GUMMOW J:   The question is, what was the locus of the tort?  We can have a debate about that but the Court of Appeal, though, has come down on the side of New Zealand.

MR LITTLE:   It has.

GUMMOW J:   It cannot readily be seen that that is clearly wrong.

MR LITTLE:   We say that is clearly contrary to the test mandated or suggested by Distillers which is to look back along the series of events which include work in New Zealand, importation of the product into New Zealand and then what is the act that gave the plaintiff his cause for complaint.  It is putting the article on the market at all so it could reach him in its dangerous condition.  That must be the act that gives him his cause of complaint.  If the “but for” test were applied, if they had not manufactured it with asbestos in it he would never have been injured by it.  If they had not put it on the market in New South Wales so it could end up in New Zealand with the toxic substance in it he would never have been injured by it.  We say that the test that is suggested by Distillers ‑ ‑ ‑

GLEESON CJ:   I do not quite understand what you mean by putting it on the market in New South Wales so that it could end up in New Zealand.  They manufactured it.  You told us they were both the manufacturers and the suppliers.  In relation to what injured your client, the particular product that injured your client – not similar products – what they did was to manufacture it in New South Wales and then supply it in New Zealand.

MR LITTLE:   We say that the admitted facts are that they supplied it either directly or indirectly in New Zealand.  We say that the inference from that is they simply put it on the market knowing it could go to New Zealand.

GLEESON CJ:   I have to say I do not know what you mean by that.  They presumably had customers in New Zealand and they entered into contracts with those customers under which they agreed to sell and the customers agreed to buy those products for delivery in New Zealand.

MR LITTLE:   There was no agreement to that effect, your Honour.  In fact, the agreement was that they had no distribution network in New Zealand or no employees in New Zealand.

GLEESON CJ:   I am just trying to understand what you mean by saying they indirectly supplied it to New Zealand.

MR LITTLE:   They put it on a market here and some exporter sent it to New Zealand.

GLEESON CJ:   What do you mean by the words “they put it on the market here” in relation to a product that ended up being used in New Zealand?

MR LITTLE:   Well, a manufacturer sells frequently through a distributor.  They manufactured it and presumably sold to, so far as the facts disclose, some middle man or agency and it ended up in New Zealand.  The agreed facts are either directly or indirectly capable of either inference but not overwhelmingly capable of the only inference that they supplied it directly to New Zealand without the suggestion they may have supplied it indirectly, that it just ended up through some exporter sending it there, because in the context of the case they had no network – distribution network or employees in New Zealand.  They had no presence there which was what the trial judge fixed on.  There was no way they could discharge their duty there.

GUMMOW J:   Yes, I know, but one of the problems you have, Mr Little, is these rather sketchy agreed facts at page 4 of the application book.  They are really not very satisfactory.  Look at paragraph (4):

Between January 1963 and July 1966, the plaintiff was exposed to, and inhaled, asbestos when he worked as a lagger in New Zealand –

for a particular employer and he:

was exposed to, and inhaled, asbestos dust and fibres when he worked with –

meaning used in his daily tasks:

asbestos‑containing insulation products –

Now, how they got there and by what mechanism into New Zealand is ‑ ‑ ‑

MR LITTLE:   Except for agreed fact (7) ‑ ‑ ‑

GUMMOW J:   And (8):

(a)      Were manufactured by Amaca in New South Wales;

(b)Were distributed by Amaca throughout Australia and New Zealand ‑ ‑ ‑

MR LITTLE:   But they maintained no premises, employees.

GUMMOW J:  

Were supplied by Amaca from New South Wales directly or indirectly to Van Doorne –

who was his employer.

MR LITTLE:   Yes, your Honour, but in the context of the fact that they had no premises, employees or other presence in New Zealand.

GLEESON CJ:   What was the business of Van Doorne Bros of Cambridge?

MR LITTLE:   They were insulating contractors, your Honour, wrapping asbestos product around the piping, as we understand it, in timber mills.

GLEESON CJ:   Presumably, if they wanted to get their hands on some asbestos lagging, which at the time was regarded as a safety product, then they would either buy it from somebody in New Zealand or buy it from somebody in Australia.

MR LITTLE:   That is so, your Honour.

GLEESON CJ:   For export, for delivery in New Zealand.

MR LITTLE:   That could well be so, your Honour.

GUMMOW J:   Yes, it could well be, but we just do not know.

MR LITTLE:   All the breaches pleaded involved breaches in Australia and they were all admitted as breaches of duty and they were things such as failing to research the dangers, failing to substitute materials with a non‑toxic material, things of that sort.  His Honour confined himself to two and the Court of Appeal confined themselves also to those two, whereas the whole case as pleaded was a case of manufacturing an inherently dangerous product.

GLEESON CJ:   Yes, thank you, Mr Little.  Yes, Mr Finch.

MR FINCH:   Thank you, your Honours.  Your Honours, the written outline is reasonably comprehensive and I will not rehearse it.  Can I deal with the matter as briefly as I can by confining myself perhaps by overview to the grounds relied on in application book 88.  Your Honours will see that ground 2(a) suggests the court below:

erred in holding that in an action against the Australian manufacturer of an inherently dangerous product, the location of the place of the tort was the place where the product caused the Plaintiff’s injury rather than the place where the Defendant acted.

It is worth observing that that does not reflect any holding by the court below nor its process of reasoning and there are three important defects in that ground which illustrate some of the reasons why special leave ought not be granted.  Firstly, there is no special or particular rule that was formulated in the court below for actions for the manufacture of inherently dangerous product, nor is there any warrant in this Court’s previous decisions in similar matters for inventing such a rule.  That rule seems to form a principal plank of the applicant’s case.

Secondly, no rule was formulated in the court below that in such cases, or indeed in any case, that the location of the place, the tort, was where causation of the injury occurred.  His Honour the Chief Justice below was careful ‑ ‑ ‑

GUMMOW J:   Where do we see that in the Chief Justice’s judgment?

MR FINCH:   Your Honour, the discussion starts at paragraph 10 of the judgment below which appears at page 51 of the book and it culminates after review of all of the relevant authorities, and in particular in relevant order, Jackson v Spittal, Distillers and Voth, in particular.  His Honour then culminates that discussion with a summary, and an accurate one, at paragraph 38 at 59 of the book.  Those, as your Honours will recall, are the three versions, as it were, of the test for determining the place of the tort.

His Honour in the court below firstly got the tests right and, secondly, applied them to such of the facts as were available.  It has already fallen from your Honours that there are certain defects in completeness in the facts that were agreed, that those were the facts that the applicant went to trial on and did not establish any further facts.  Such defects in those facts that might or might not support its argument now are defects that the applicant cannot now in this Court cure.

Where the applicant sets up, as it apparently now does, in that first ground, ground 2(a) as the appropriate test, that is, rather than the place where the defendant acted that has two problems.  The first and perhaps most important one is it simply begs the question, what act?  What acts are relevant?  The answer to that question is in paragraph 38 of the Chief Justice’s judgment.  Those are the tests where one gets to analyse what it is that one looks at in terms of the act of the defendant.  As his Honour correctly observed in the last two lines on page 59:

Each of these tests will lead to the same result. The common these is a concern with substance not form.

The second defect that there is with this alternative postulation at the end of ground 2(a) that it simply inaccurately states those tests.  Those tests do not amount to one test – where did the defendant act.  They are of more particularity and of more utility and we say that the applicant fails to grapple with those.  I will not drag your Honours through those previous authorities.  Your Honours have seen them many times before.  As I have said, his Honour reviewed those authorities from paragraphs 10 to 38.

The Court did not, as seems to be postulated now, engage in a contest between the place of manufacture and the place of causation.  That that is true appears from paragraphs 20 to 22, perhaps most plainly, out of the Chief Justice’s judgment below where your Honours will see that his Honour remarks if one looks at the history of cases on this sort of matter, firstly, at the top of the page perhaps is best:

Each case turns on its facts –

His Honour then observes in 21:

On occasions this issue has been determined in favour of the place of manufacture, rather than the place of exposure to risk or of causation…

22       In other cases the relevant act has been found to continue to the point of exposure –

I need not go on but what is inherent in that process of reasoning is what is important about what is correct about this judgment, that is, his Honour correctly observed that there is a continuum of circumstance that has to be analysed.  His Honour does analyse that continuum and correctly observed that that continuum, for this purpose, in this case, relevantly continued up to and including acts in New Zealand which ‑ ‑ ‑

GLEESON CJ:   Acts by whom?

MR FINCH:   Acts by Amaca in New Zealand, that is, manufactured in New South Wales, but as came out in argument, for instance, it was observed that if this product had been manufactured in New South Wales and had fallen off the ship between Sydney and Auckland, Mr Frost would not have lost a cause of action.  Nothing had accrued to Mr Frost while those goods were on the ship.  It was not until that ship docked and the goods were supplied to somebody in New Zealand, and it does not matter whether it is an intermediary or not, and that he was in due course exposed to it that it could be said that each of those three tests that his Honour summarises in paragraph 38 gave rise to a meaningful result.

It is also not true to say, as the applicants say in their written outline, that his Honour below effectively applied a last event analysis.  His Honour specifically disavowed that sort of approach.  What his Honour did was observe all of the events from first to last and then placed the relevant act in that continuum of events in New Zealand.  Where the applicants defect is in this case is that they are indulging in a first event fallacy, one which is equally wrong but equally not approved of by the authorities.

There are a number of matters which I want to mention just in point form summary.  It is wrong to say, with respect, that his Honour engaged in a simple exercise of following Putt.  His Honour specifically in his judgment warned against the danger of factual analogy but did mention, of course, that there were other cases which had some similarities but his Honour specifically did not simply, slavishly or otherwise, follow Putt.

GLEESON CJ:   Where did he deal with Putt?

MR FINCH:   His Honour deals with Putt in a number of cases but perhaps most importantly for today’s purposes in paragraph 22 his Honour dealt with Putt as being one of the cases where “exposure may also be expressed”.  Your Honour sees in paragraph 22 on page 55 of the book that:

exposure may also be expressed in terms of a failure to warn, but this is not a necessary characterisation.

Putt is one of the cases that is referred to there and his Honour simply noted at the end of that paragraph that special leave was refused in Putt on the basis there was no sufficient reason to doubt the court’s conclusion about the location of the tort.  His Honour does not say because Putt was similar and because special leave was refused therefore the place of the tort is in New Zealand.  He simply observed that Putt was one of those cases where in that continuum of events the event was placed, most importantly in New Zealand.

GUMMOW J:   Then paragraph 23 is important because that sets the stage for what his Honour then did in some detail.

MR FINCH:   Precisely, your Honour, yes, and that is the exercise starting at paragraph 25 and then culminating in his Honour’s very firm conclusion at paragraph 57.  Now, before his Honour got to 57, which is at page 63 of the book where his Honour said:

In my opinion, the only conclusion open, with respect to the issue of mixed fact and law . . . was New Zealand.

Before his Honour got there your Honours should know that another important part of his Honour’s judgment below was the correction of a large number of mischaracterisations, with respect, by the trial judge of the agreed statement of facts and, indeed, of the nature of the case itself.

His Honour the trial judge, for instance, characterised the case as one being of negligent manufacture.  It was plainly wrong.  There was nothing wrong with the manufacture of this asbestos product in the same way as there was nothing wrong with the manufacture of Distaval in Distillers.  The case was a different one, not, in our submission, that it makes any particular difference whether one characterises the tort as being one involving an inherently dangerous good or a defective good or anything else.  Those distinctions do not form any part of the tests that were summarised in paragraph 38. 

I will not go into the areas in which his Honour corrected errors of the trial judge involving mischaracterisation of the agreed statements of fact because they are not terribly germane to this special leave application, except to say this.  When one closely analyses the judgment, it was sufficient for the result simply to correct those errors and the result would have flowed from that correction and to that extent this half of the case, that is about place of the tort, turned on facts and is not an appropriate vehicle for special leave to be issued in any event.

Before I move on, your Honours, to the second major half of the case, can I simply go back very quickly to the grounds where I started on page 88 of the book.  Your Honours will notice ground 2(b) has not had a mention.  It does not get a particularly large mention, I think, anywhere in oral or written submissions from the applicant.  It asserts that there was an error:

in holding that the Respondent had breached its duty in New Zealand when, on the agreed facts and the facts found by the trial judge, the Respondent had no presence –

and there seems to be some gap –

personal or ability to control distribution or sale ‑ ‑ ‑

GLEESON CJ:   “Personnel”, I think it meant.

MR FINCH:   Yes, thank you, your Honour –

or ability to control distribution or sale in New Zealand.

There are a number of problems with that which I will not go to at length, but if your Honours look at the agreed facts at the appeal book pages 48 to 49 and look at the agreed facts (7) and (8)(b) and (8)(c), those were such of the agreed facts as went to this sort of issue.  There was no agreed fact as to the latter half of this ground 2(b), that is, where it is asserted that there was either an agreed fact or a finding that Amaca had no ability to control distribution or sale in New Zealand your Honours will look in vain for any such agreed fact or any such finding by the trial judge.  The ground, with great respect, is simply misconceived.  There was no such contest set up on the facts or in the judgments.  So that that does not take the applicants any further.

Can I finally turn, and perhaps as briefly as I can, to the choice of law question.  Again, I do not wish to say much more than is in our written submissions about it, but can I observe this, your Honours.  If one again takes as our starting point ground 2(c) on page 88 of the book, the ground is that:

The Court of Appeal erred in its application of Australian choice of law rules in failing to apply the whole of the law of New Zealand including that which allowed a New Zealand cause of action to be brought in an Australian Court.

That, with respect, is not a terribly informative ground, but it is expanded upon and perhaps restated a couple of pages later at page 92 of the book.  On the first page of the applicant’s summary of argument your Honours see that two special leave questions are said to arise and this is the second one, point (2), and this appears to be the restatement of ‑ ‑ ‑

GUMMOW J:   So‑called renvoi point.

MR FINCH:   Yes, and it simply is not.  One of the gravest difficulties with this question is it sets up a contest which is simply an illusory contest.  It says:

The other concerns the content of foreign law:  if the liability is to be determined according to the law of the place where use of the product caused the plaintiff’s injury, is the whole of the substantive law of that place to be applied or is the liability to be determined by asking what a court of that place would do?

Now, the shortest answer to that question is it simply does not seem to take any account of the decision of this Court in Neilson which deals very extensively with that question.  This question has been asked and answered comprehensively in Neilson.  This ground appears to set up a contest which simply does not find any reflection in Neilson at all.

The couple of points which I would simply ask your Honours to note in this connection, and I will start with one slightly off point, starts at paragraph 67 at page 66 of the book where his Honour the Chief Justice rightly recorded the current test in respect of the substance procedure debate on which I do not stay.  My learned friend has not made a big deal of it and we will not expand on our written submissions on the point, that is, deriving from Pfeiffer’s Case, the question is the “existence, extent and enforceability” of a right replacing the older test. 

That does not seem to be a great part of the case today.  But more importantly, his Honour then sets out, starting at about that point, to embark on a lengthy analysis of the relevant authorities in this area culminating, perhaps most helpfully, at the paragraph starting at paragraph 82 on page 69 of the book.  His Honour rightly refers to the recent authorities in this Court, in particular ‑ ‑ ‑

GUMMOW J:   The last sentence of paragraph 82.

MR FINCH:   It is, yes, and particularly pointing out perhaps the most obvious defect in this ground relied upon by the applicant.  If one turns through to page 74, paragraph 99, his Honour culminates this analysis with an apposite quote from your Honour Justice Gummow’s joint judgment with Justice Hayne.  I will not read it out, but your Honours see that precisely the same sorts of concepts that are mistakenly separated by the applicant into two opposing notions are made very clear in this excerpt.  It is not to be opposing notions at all.

GUMMOW J:   There is said to be some error through inadequate attention to the New Zealand decision in Donselaar.

MR FINCH:   Yes, there is a problem with that.

GUMMOW J: [1982] 1 NZLR 97.

MR FINCH:   Your Honours have not been taken in detail to Donselaar, but I can make a number of short points about it.  Firstly, the observation apparently upon which reliance is placed is one from Justice Richardson in that case where his Honour mobilises the old test between abolishing the right and the remedy which is not a relevant distinction in any event any more, but more importantly, if one looks closely at his Honour’s examination in that case of the facts his Honour actually does not deploy that distinction, even in the old terms, to any effect at all.  His Honour simply closely examines what exemplary damages are and whether or not they were or were not caught by the terms of the legislation as it then stood. 

Now, as it turns out, that examination becomes now superfluous because the legislation now makes it express that exemplary damages may be claimed.  But if one thinks about it for a moment, the analysis goes nowhere.  Let it be assumed that his Honour there for a moment observed that for the purpose of determining whether exemplary damages could be claimed there was utility in examining the old distinction between extinguishing the right and extinguishing the remedy, where does that get the applicant on this test or on this application?  It does not flow through to any conclusion that was deployed to any effect by the Court of Appeal at all.  It appears to be an observation that does not point up any error made by the Court of Appeal or any alternative approach that ought to have been adopted. 

Now, I can expand on that case if your Honours wish, but otherwise I would not wish to take your Honours’ time by simply reciting matters we have already dealt with in our submissions. 

GLEESON CJ:   Thank you, Mr Finch.  Yes, Mr Little.

MR LITTLE:   Yes, thank you, your Honour.  The Donselaar point, in our submission, your Honour, does get into the reservation in Zhang of what this Court would do about the limits and extent of damages available in the foreign law court.  We say that this Court specifically reserved that point in Zhang and we say the fact that the cause of action still subsists means that that point is enlivened in this case.

We say that this is not the usual forum shopping case.  This is a case where the defendant is being sued in its natural jurisdiction.  So we say it is only reasonable that it is liable for the sort of damages it would be liable for had its tort been located strictly within New South Wales.

To deal with the reasoning of the Court of Appeal on the test that they applied, we refer to paragraph 44 of the judgment which appears at page 61 of the book where his Honour says he does not agree with the analysis by the trial judge.  He says:

The admitted breaches were breaches of duty owed to a person in New Zealand.

Well, that cannot be contested.  He said:

The element of causation occurred in New Zealand.

That also cannot be contested, but in Distillers it was assumed that the element of causation could have occurred in South Africa, but that did not fix South Africa as the choice of law.  Then he says, having applied those two things:

In my opinion, as a matter of substance, the place where “the cause of action arose” (Distillers) was where the Respondent was exposed to the risk –

Well, we say once again, that is contrary to the reasoning in Distillers.  Until that happened, there was no cause for complaint and it was at that point the earlier conduct assumed significance.  Well, that is when injury is caused and that, we say, has been rejected as the test.  The test is to focus, we submit, on the acts of the defendant not where the consequences of their conduct have caused damage.  Those are our submissions.

GLEESON CJ:   Thank you, Mr Little.

In the light of the agreed facts in this case, we think that there are insufficient prospects of success of an appeal to warrant a grant of special leave.  The application is dismissed with costs.

We will adjourn for a short time to reconstitute.

AT 11.11 AM THE MATTER WAS CONCLUDED