Future Systems (AUST.) Pty Ltd v Nautilus Aviation Pty Ltd - [2023] WASC 204

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   FUTURE SYSTEMS (AUST.) PTY LTD -v- NAUTILUS AVIATION PTY LTD [2023] WASC 204
CORAM:   MASTER SANDERSON
HEARD:   2 MARCH 2023
DELIVERED          :   13 JUNE 2023
FILE NO/S:   CIV 2381 of 2021
BETWEEN:   FUTURE SYSTEMS (AUST.) PTY LTD
Plaintiff

AND

NAUTILUS AVIATION PTY LTD
First Defendant

THE COMMONWEALTH OF AUSTRALIA
Second Defendant

NAUTILUS AVIATION HELI PTY LTD
Third Defendant

Catchwords:

Summary judgment - application by first and third defendants - Turns on own facts

Legislation:

Civil Aviation (Carriers' Liabiility) Act 1959 (Cth)
Civil Aviation (Carriers' Liability) Act 1964 (Qld)
Rules of the Supreme Court 1971 (WA)

Result:

Application dismissed

Category: B

Representation:

Counsel:

Plaintiff	:	R Cywicki
First Defendant	:	T J Brennan SC & M Sims
Second Defendant	:	M Rush KC & PA Walker
Third Defendant	:	T J Brennan SC & M Sims

Solicitors:

Plaintiff	:	Hale Legal
First Defendant	:	Carter Newell
Second Defendant	:	Minter Ellison
Third Defendant	:	Carter Newell

Cases referred to in decision:

Barclay v Penberthy [2012] HCA 40; (2012) 246 CLR 258
Garnett v Qantas Airways Limited [2021] WASCA 110; (2021) 358 FLR 398
Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14; (2019) 266 CLR 212

MASTER SANDERSON:

This is an application by the first and third defendants (the defendants) for an extension of time to bring a summary judgment application and for summary judgment against the plaintiff. In the alternative, the defendants seek to strike out certain paragraphs of the plaintiff's amended statement of claim. Unusually the second defendant does not support the defendants' application. In short written and oral submissions, the second defendant submitted summary judgment ought not be granted. It is worthy of note that were the defendants' summary judgment application to succeed, the action against the second defendant would continue. This is a rather curious state of affairs.
There was no dispute between the parties as to the relevant principles relating to summary judgment. However, as this is an application brought by the defendants under O 16 of the Rules of the Supreme Court 1971 (WA), it does differ in some respects from an application for summary judgment brought under O 14. Two points should be highlighted. First, the plaintiff is bound by its statement of claim - or in this case, the amended statement of claim. It is not open to a plaintiff to claim there are further material facts which have not been pleaded which would stand in the way of summary judgment being granted.
Second, the facts pleaded in the statement of claim must be accepted for the purposes of the summary judgment application. It may be at trial some or all of the facts alleged by the plaintiff are not proved. But for the purposes of summary judgment, it must be assumed they will be proved. This is a manifestation of the rule that on a summary judgment application, the version of events most favourable to the party opposing summary judgment must be assumed.
There is one further distinction between O 14 and O 16. If an application for summary judgment is dismissed under O 14, there is no right of appeal. That is not the case with O 16. That necessarily means reasons for decision on an O 16 application must be more detailed to provide an opportunity for review. However, an application for summary judgment is not an occasion for determining any issues of fact. While assumptions as to the facts are necessary, the acceptance of those facts for the purposes of summary judgment has no bearing on the ultimate outcome of the case.
The defendants in this case require an extension of time to bring the summary judgment application. The writ of summons was filed on 17 December 2021 and was served on the solicitors then acting for the first defendant on 10 January 2022. An appearance was filed by the first defendant on 4 February 2022. A defence was filed by the first defendant on 21 February 2022. It is to be noted that in its defence, the first defendant pleaded the legal relationship between the plaintiff and the first defendant was governed exclusively by the provisions of the Civil Aviation (Carriers' Liability) Act 1959 (Cth).
An amended writ of summons was filed on 16 March 2022 and served on the parties on 17 March 2022. The amendment added the third defendant. The third defendant filed an appearance and a defence on 1 April 2022. The plaintiff notes that the defendants' applications for an extension of time were filed more than 220 days after the first defendant filed an appearance and more than 163 days after the third defendant filed an appearance. It is the plaintiff's position based on the length of the delay and what the plaintiff says is a failure to explain the delay, the extension of time ought not be granted.
The defendants explain the position this way. They say on 9 June 2022, the defendants' insurer made a decision on coverage and the defendants' then solicitor was replaced by the defendants' present solicitor. It was not until 27 July 2022 the defendants' present solicitors came onto the record. On 26 August 2022, the defendants' solicitors wrote to the plaintiff's solicitors providing a detailed explanation as to why the claims against the first and third defendants were bound to fail. There was no response from the plaintiff. On 27 September 2022, the defendants filed the present applications. The defendants also note that subsequent to the filing of the applications, on 21 October 2022, the plaintiff filed its reamended statement of claim. The defendants make the point the statement of claim was amended consequent upon the defendants' application.
It is the defendants' position they have adequately explained the delay. In essence, they say the insurers were making a decision and once the decision was taken, the defendants' solicitors acted promptly to bring the application. They also say that the plaintiff is unable to point to any prejudice as a result of the delay. There has been little progress in the action and at least by implication, the defendants say any prejudice the plaintiff has suffered could be adequately dealt with by a costs order.
This is one of those cases where the strength of the defendants' summary judgment application is determinative of the outcome for the extension of time. The aim of the 21 day time limit in O 16 is to ensure that applications for summary judgment are brought promptly. There may be good reason why the 21 day period is exceeded. But it is for a defendant to explain the delay. It is not in my view, enough to say that insurers were considering the position. It would have been open to the defendants to at least foreshadow an application for summary judgment with the effect of the defendants reserving their position. But to simply take no action for such a long period after the appearances were entered requires either a detailed and reasonable explanation or a compelling case such that it would not be in the interests of justice to allow the action to proceed. In this case, the explanation is inadequate. So the outcome of the application for an extension of time is related to the strength of the defendants' case.
At this point it is appropriate to examine in some detail the nature of the plaintiff's claims. The proceedings concern claims for losses arising from the crash of a helicopter in far north Queensland. The plaintiff rightly accepts that the law of Queensland governs those claims. As a result of the crash, two employees of the plaintiff, Mr Cockburn and Mr Iredell, who were passengers on the helicopter suffered bodily injury. The plaintiff sues for a range of losses incurred by it consequent upon Mr Cockburn and Mr Iredell being injured. The Civil Aviation (Carriers' Liability) Act 1959 (Cth) (Commonwealth Act) provides for liability of carriers engaged in international and interstate civil aviation. The Commonwealth Act is the foundation of a national scheme with each of the States having enacted legislation substantially in the same terms as the Commonwealth Act. In Queensland, the relevant Act is the Civil Aviation (Carriers' Liability) Act 1964 (Qld) (Queensland Act). In substance, the state Acts apply the relevant provisions of the Commonwealth Act to losses consequent upon the death and injuries to passengers in intrastate carriage.
In this case, the relevant provisions of the Queensland Act are ss 2(1), 2(2), 4(1) and 5(1). The relevant provisions of the Commonwealth Act are ss 26(1), 28, 31(1), 33(1), 36 and 37. The defendants, in their written submissions, refer to these sections collectively as the Carriers' Liability Regime. I will adopt that descriptor.
The defendants say the application of the Carriers' Liability Regime in this case turns on s 4(1) of the Queensland Act. This section has four elements:
(a)first, the carriage of a passenger;
(b)second, the carriage is in an aircraft operated by the holder of an airline licence;
(c)third, the carriage is in the course of commercial transport operations; and
(d)fourth, the carriage is under a contract for the carriage of the passenger.
The defendants analyse the prospective liability of the first and third defendants in slightly different ways. Dealing first with the third defendant, it is said it is common ground that the third defendant was 'the carrier' within the meaning of s 28 of the Commonwealth Act. It is said that was the case because:
(a)as operator of the aircraft it was, within the ordinary meaning of the term the 'carrier';
(b)in the legislative context the expression 'the carrier' follows the phrase 'where this part applies to the carriage of a passenger'. Thus, 'the carrier' is the legal person who undertakes that 'carriage'; and
(c)the expression 'where this part applies' is construed in accordance with s 5(1)(a) of the Queensland Act to be a reference to when the Queensland Act applies.
Section 4 of the Queensland Act applies to carriage conducted by the holder of an 'airline licence' being a party holding an air operator's certificate (AOC). The third defendant is the only entity which was the holder of an AOC and the only entity alleged by the plaintiff to be the holder of an AOC.
Liability for bodily injury caused to Mr Cockburn and Mr Iredell on the incident flight was imposed on the third defendant by s 28 of the Commonwealth Act. Every other liability 'in respect of personal injury' was excluded by s 36 of the Commonwealth Act. The defendants say it is now established that the liability created by s 28 is event based and is exclusive of all other legal liabilities imposed on the third defendant. It is said the phrase 'in respect of' in s 36 has a breadth such that the Carriers' Liability Regime is the exclusive source of liability for losses arising from injury in the course of carriage to which the regime applies: see Parkes Shire Council v South West Helicopters Pty Ltd [2019] HCA 14; (2019) 266 CLR 212 and Garnett v Qantas Airways Limited [2021] WASCA 110; (2021) 358 FLR 398.
The defendants say the decisions firmly establish the scope of liabilities excluded by s 36 is not confined to matters in respect of which liability is imposed by s 28. It follows the plaintiff's claims for losses in respect of personal injuries to Mr Cockburn and Mr Iredell made against the third defendant in contract and in tort are bad in law. They are liabilities which are precluded by s 36 of the Commonwealth Act. So too, all of the losses claimed by the plaintiff which were in respect of personal injuries to Mr Cockburn and Mr Iredell were precluded except to the extent that liability for them was imposed by s 28.
The defendants then ask which, if any, of the plaintiff's claims are for damage under s 28 of the Commonwealth Act. They say this question turns on whether the claims are 'for damage sustained by reason of the bodily injuries suffered by Mr Cockburn and Mr Iredell resulting from the crash within the meaning of s 28'. The defendants say none of the heads of damage claimed by the plaintiff fall within that definition. They are too remote. Questions of assessment and remoteness of damages by reason of the bodily injuries suffered are not dealt with by the Carriers' Liability Regime but are left to be determined in accordance with the general law. The defendants then refer to the High Court decision in Barclay v Penberthy [2012] HCA 40; (2012) 246 CLR 258. They say the reasoning in that case shows that Australian law does not recognise as recoverable damages on a liability by reason of personal injury loss caused to an employer by reason of the injury done to an employee. Accordingly, the claim made against the third defendant cannot succeed.
Much the same argument is put in relation to the first defendant. The defendants address an issue raised in the amended statement of claim as to whether the first defendant was an 'agent' of the third defendant. It is the defendants' position that question does not need to be answered. The defendants say that so far as the first defendant is concerned, the claims against it in contract, tort and pursuant to s 28 of the Carriers' Liability Regime are bound to fail because s 33 of the Commonwealth Act operates so that the first defendant can avail itself of all the conditions of liability that the Carriers' Liability Regime applied to the third defendant's liability.
The above is really a truncated summary of detailed submissions made on behalf of the defendants. It is apparent that the issues raised by this action are by no means straight forward. This was highlighted by the second defendant in its written submissions. Relevantly, those submissions read as follows:[1]
First, research has not revealed any case in which a court in this country has decided that economic loss of the kind allegedly suffered by the plaintiff (by reason of its employees' injuries) is not recoverable under s 28 of the Commonwealth Act. No such case has been referred to by Nautilus. This proceeding raises a novel question of law.
Secondly, even if it is accepted that domestic law determines what damages might be recoverable in relation to an action under s 28, it does not necessarily follow in this case (as Nautilus appears to assume) that the relevant or applicable domestic law for that purpose is, or is to be dictated by, the ancient action per quod servitium amisit.
As the High Court stated in Parkes Shire Council v South West Helicopters Pty Ltd, s 28 of the Commonwealth Act creates a liability that is "distinct from any liability that might arise under domestic law." The literal words of s 28 are broad and, as a matter of statutory construction (having regard to the text, context, and purpose of the provision), may allow for recovery beyond the limits of the action per quod.
It is evident from its statement of claim that the plaintiff claims to have suffered economic loss that is causally connected to bodily injury suffered by its employees resulting from an aircraft accident. The precise assessment of the causal connection between the injury and the claimed economic loss, and whether it engages s 28 of the Commonwealth Act, may be influenced by the detail of the evidence ultimately adduced at trial by the plaintiff. At any rate, the question is important and novel, and involves some complexity. It should not be determined on a summary basis, without the benefit of full argument at trial.
[1] Second defendant's submissions dated 23 February 2023 [7] - [10].
It is unnecessary to consider in any detail the submissions made on behalf of the plaintiff. While those submissions directly addressed the issues raised by the defendants, the position of the plaintiff is adequately summarised by reference to those sections of the second defendant's submissions which I have quoted above. In the end I am satisfied this is not a case which is suitable for summary judgment. The issues it raises are too complex and too novel for the blunt instrument remedy of summary judgment to be appropriate.
Based on the above, I am not satisfied an extension of time to bring the summary judgment application is justified. The delay is significant and the case is not so overwhelmingly in favour of the defendants that the interests of justice require an extension.
The defendants, during the course of submissions, raised issues as to the adequacy of the present reamended statement of claim. Given I have concluded summary judgment does not run, it does not appear as though the differences between the parties as to the pleading are significant. On publication of these reasons, the parties should confer in relation to the presently extant pleading with a view to resolving areas of difference. If after conferral, the defendants maintain their view as to the adequacy of the pleading, then short submissions on that issue can be filed. That should be done within 14 days of the publication of these reasons. The plaintiff should respond 7 days thereafter. The costs of this application, including reserved costs, should, in conformity with usual practice, be costs in the cause.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
TM
Court Officer
13 JUNE 2023