Graham Barclay Oysters & Ors v Ryan & Ors
[2003] HCATrans 801
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S258 of 2001
B e t w e e n -
GRAHAM BARCLAY OYSTERS PTY LIMITED
First Appellant
GRAHAM BARCLAY DISTRIBUTORS PTY LIMITED
Second Appellant
and
GRANT RYAN, SCOTT CALLAGHAN, KEVIN GOWER, DAVID HOLNESS, GEOFFREY BENNETT, BRYAN HOCKING AND BROSOW HARDY
First Respondents
GREAT LAKES COUNCIL
Second Respondent
STATE OF NEW SOUTH WALES
Third Respondent
Office of the Registry
Sydney No S259 of 2001
B e t w e e n -
GRANT RYAN
Appellant
and
GREAT LAKES COUNCIL
First Respondent
GRAHAM BARCLAY OYSTERS PTY LIMITED
Second Respondent
GRAHAM BARCLAY DISTRIBUTORS PTY LIMITED
Third Respondent
STATE OF NEW SOUTH WALES
Fourth Respondent
Office of the Registry
Sydney No S261 of 2001
B e t w e e n -
STATE OF NEW SOUTH WALES
Appellant
and
GRANT RYAN, SCOTT CALLAGHAN, KEVIN GOWER, DAVID HOLNESS, GEOFFREY BENNETT, BRYAN HOCKING AND BROSOW HARDY
First Respondents
GREAT LAKES COUNCIL
Second Respondent
GRAHAM BARCLAY OYSTERS PTY LIMITED
Third Respondent
GRAHAM BARCLAY DISTRIBUTORS PTY LIMITED
Fourth Respondent
CLIFT OYSTERS PTY LIMITED
Fifth Respondent
M.W. & E.A. SCIACCA PTY LIMITED
Sixth Respondent
TADEVEN PTY LIMITED
Seventh Respondent
THE OYSTER FARMERS ASSOCIATION OF NEW SOUTH WALES PTY LIMITED
Eighth Respondent
R.A. KING (WHOLESALE) PTY LTD
Ninth Respondent
MANETTAS LIMITED
Tenth Respondent
SHONID PTY LIMITED (TRADING AS “TIM & TERRY OYSTER SUPPLY PTY LIMITED”)
Eleventh Respondent
VICTORIAN FROZEN FOOD DISTRIBUTORS PTY LIMITED (TRADING AS “RICHMOND OYSTERS”)
Twelfth Respondent
SMITHS OYSTER SERVICE PTY LIMITED
Thirteenth Respondent
GEORGES OYSTERS PTY LIMITED
Fourteenth Respondent
Consequential orders
McHUGH J
GUMMOW J
HAYNE J
TRANSCRIPT OF PROCEEDINGS
AT SYDNEY ON TUESDAY, 18 MARCH 2003, AT 2.01 PM
Copyright in the High Court of Australia
MR C.R.R. HOEBEN, SC: May it please the Court, I appear for the Barclay companies with my learned friend, MR A.P. COLEMAN. (instructed by PricewaterhouseCoopers Legal)
MR J.B.R. BEACH, QC: If the Court pleases, I appear for Mr Ryan with MR M.L. BRABAZON. (instructed by Slater & Gordon)
MR T.G.R. PARKER: If the Court please, I appear for the Greater Lakes Council. (instructed by Coudert Brothers)
MR P.W. TAYLOR, SC: If the Court pleases, I appear for the State of New South Wales. (instructed by Crown Solicitor for the State of New South Wales)
McHUGH J: Mr Beach, I think we should hear from you first, and we will limit your submissions to 15 minutes. Other parties may get the same time or less. They certainly will not be getting any longer. So would you put what you want to put within the time.
MR BEACH: There are four substantive issues that we raise in terms of the draft minutes that we circulated this morning which suggest amendments to the draft minutes published by the High Court on 6 March.
GUMMOW J: We did not publish anything.
MR BEACH: Yes, I accept that. The four points that we wish to put are these. First, the Graham Barclay entities, Barclay Oysters and Barclay Distributors, ought be responsible for one half of the Council’s costs at all levels, so that on any view of the matter Mr Ryan would pay half the Council’s costs and the Barclay entities would pay the other half. I will put to one side for the moment the question of the Bullock order.
We say that for these reasons. The Barclay entities at trial and at all levels put a case against the Council which was a case similar to the case that Mr Ryan put against the Council. It is important to note that the Barclay entities had a cross‑claim and, in relation to Barclay Oysters, that cross‑claim was pursuing an independent damages claim for expenses and matters involved in relation to the lost sales. So the Graham Barclay entities were not only putting a case against the Council in terms of contribution and indemnity but were also putting a case for their own separate damages. We say that the orders that the High Court by letter forwarded to the parties on 6 March do not adequately reflect that breakdown.
Particularly in the High Court, the Graham Barclay entities had their own notice of appeal that was directed to two issues. The first issue was the negligence finding against them in favour of Grant Ryan. The second issue, as appears from the notice of appeal in the High Court, was an appeal against the Full Federal Court’s finding in relation to the Council’s liability. So that, on any view of the High Court, in terms of talking about the Council’s costs, the Barclay entities in relation to their notice of appeal dealing with the Council’s liability should bear some of the Council’s costs. We accept that the Court’s minutes require Mr Ryan to bear the Council’s costs in relation to his notice of appeal, but essentially there were two notices of appeal before the High Court dealing with the Council’s liability.
In terms of the position in the Full Federal Court, the question of the Council’s costs should be dealt with in the same way, putting to one side the question of the Bullock order. Given that the Great Lakes Council appeal in the Full Federal Court had as respondents not only Mr Ryan but also other parties, including the Graham Barclay entities, it is appropriate, we say, that the appeal to the Full Federal Court by the Council, although allowed with costs, those costs should be payable not only by Mr Ryan but also the Barclay Oysters and the Barclay Distributors entities. We take a similar position in relation to the question of the costs at trial. So that is the first point. The minutes that we circulated this morning are designed to reflect the submission that I have just put.
The second point that we say this Court ought address in our favour is the question of a Bullock order. We say it was reasonable and appropriate for Mr Ryan to pursue the Barclay entities, not only under the Trade Practices Act but also on the issue of negligence, and also the claims against the Council and the State. We say that the reasonableness of that joinder and the pursuit of those claims could hardly be denied when we won at first instance and, in fact, we kept two of the three judgments on negligence after the Full Federal Court’s decision. So we say the reasonableness of the joinder and the appropriateness of the joinder could hardly be denied.
McHUGH J: Well, I do not know it follows that the reasonableness of the joinder is a necessary consequence of that proposition, given the results in the courts below. It might have been reasonable to bring the action. It does not necessarily follow that it was reasonable to join the parties for the purposes of a Bullock order. They were independent actions. They were independent tortfeasors.
MR BEACH: They may be independent, and, in fact, we could have made alternative claims, and that does not deny the basis for receiving a Bullock order. That was the position in the Johnson’s Tyne Case in this Court. It is the position in the Sanderson Case, and also the position in the Bullock Case itself. So the fact that there may be independent causes of action, indeed, alternate causes of action, does not deny this Court’s discretion in terms of it being exercised in favour of the Bullock order.
McHUGH J: That is so, but they do not have any relationship to each other. Their action under the Trade Practices Act has no relationship to the other action.
MR BEACH: We, with respect, disagree. Can I just point your Honours to what Justice Wilcox said in relation to the section 74B claim which did succeed at first instance. If your Honours go to paragraph 365 of his Honour’s judgment.
McHUGH J: Where will I find that, Mr Beach?
MR BEACH: We did send up copies of Justice Wilcox’s decision as a separate bundle. Hopefully it has found its way.
McHUGH J: Yes, I have it.
MR BEACH: Paragraph 365, one of the defences to the section 74B case which the Barclay companies ran was the proposition that:
it was unreasonable for anyone to rely on the skill or judgment of the grower “since the expert evidence reveals that it was not possible to ensure that an oyster was free of viral contamination –
So they were running, in defence of the Trade Practices claim, the suggestion that we could not get up under the Trade Practices Act because it was not reasonable for us to rely upon them, because they could not test for viral contamination.
As soon as you accept that argument, you then go to the next stage: well, if you could not virally test, what could you do? And then you got into the issue of, well, you should not grow otherwise than in a contaminant‑free environment, or you should do sanitary surveys to try and work out whether or not you have a contaminant‑free environment, and if you cannot do that, you should not grow and harvest. So we say that the Trade Practices claims are not separate from the negligence claims in the sense that the factual matrix underpinning that defence to the section 74B claim is similar to the factual matrix which underpinned our case of negligence against the Barclay companies.
McHUGH J: But there is a world of difference between the two. There are questions of duty, questions of breach, and from paragraph 365 it appears that this is a submission made by counsel for the Barclay companies. It has nothing to do with your case in chief.
MR BEACH: It has, because it is the defence that the Barclay companies put to our Trade Practices claim under section 74B. If you accept that that was a good point, then you have to move beyond just section 74B into the question of the common law duty of care owed by the manufacturer, the content of that, and breach. As soon as you move into that territory, you then move into the territory of other agencies or authorities that may have had a part to play in the growing environment of the oysters. In other words, that it is artificial to consider the manufacturer’s duty and breach without also considering all of the three players, we would say, that had some measure of responsibility, or at the least statutory power, for controlling the growing environment. That is how you move from the Trade Practices Act to the negligence claims against the Barclay entities, and from the negligence claims against the Barclay entities through to the negligence claims against the Council and the State.
HAYNE J: Well, that is a submission, is it not, that simply denies the judgment in this Court?
MR BEACH: No, I am talking about the reasonableness – of course, that has all been rejected by this Court. I accept that. I do not wish to say anything about that. I am just talking about the reasonableness and the appropriateness of the joinder. Of course, every time somebody asks for a Bullock order, there has been a finding against the plaintiff in favour of the successful defendant, and we do not deny that. I am just focusing on whether it was reasonable and appropriate for us to pursue the claims in the first instance. The Graham Barclay entities defended all the Trade Practices claims. It is not as if they made admissions, and we only got up on two of the six of them.
So we would say that the joinder was appropriate, and in circumstances where the Graham Barclay entities were themselves pursuing claims against the Council, particularly Oysters, for its own independent damages claim, we would say that a Bullock order is well and truly justified. It is not as if these were even alternate claims, such as the Court faced in Gould v Vaggelas, where the question was “Should there have been the joinder of the third party, the accountant, in the alternative?” You can understand why the Court might formulate a principle, “Well, the other party should not be met with the costs of what turns out to be an unnecessary joinder, unless they have done something to encourage the joinder”, but that was in an alternative claim basis, where you had a third party situation.
We would say, here, we do not even have an alternative claim basis. We have duties and breach – certainly the case as perceived at trial and run at trial, where they were not alternative claims. You could in fact have judgments against all three in negligence, as in fact Justice Wilcox found, albeit, as this Court has ultimately held, erroneously. So we urge on the Court the Bullock order that we seek.
The third point is the question of costs allocation. This Court has given Mr Ryan the costs of his claim against Oysters, limited to the Trade Practices issues. Now, we would say, if you are talking about a common law apportionment question on the issue of costs, we should get our general costs of the claim against Oysters, save and except any additional or incremental costs that may have been associated with the negligence claims. In other words, if it is appropriate to hive out the costs associated with the negligence claims, we say we are entitled to the general costs with any additional costs incurred on the negligence claims to be excluded.
HAYNE J: The premise for that argument is that giving you issue costs would exclude costs that you say you are entitled to.
MR BEACH: Yes, general costs, which are the costs that we would ‑ ‑ ‑
HAYNE J: And the general costs exclusion that you urge is exclusion of those aspects of the matter referable only to negligence.
MR BEACH: Yes. Only the costs that would ‑ ‑ ‑
HAYNE J: The distinction is one, I suggest, that has no real difference.
MR BEACH: Well, the difficulty with that is that Justice Dixon explains the distinction between general costs and specific issue costs in the authority of Smith v Madden (1946) 73 CLR 129. I do have separate copies of the decision that I might hand to the Court. Can I just draw your Honours’ attention to what appears at page 133, about the middle line. His Honour had dealt with apportionment of costs principles in equity, where the situation was that the court of equity would grant issue specific costs and then there would have to be an apportionment of the general costs, but in relation to the common law apportionment principles that essentially was that you would give the general costs of the action to the successful plaintiff and if there were to be issue specific costs you would hive them out of the general, and if you were giving specific issue costs in favour of the other party, you would deal with that separately.
Now, that discussion took place in a context a little different from the present case, because that was dealing with the question of costs of a claim and costs on a counter‑claim, but his Honour’s general position on common
law apportionment we would say would carry over here. In terms of the Registrar or the taxing process, we would say it would be very difficult for the Registrar to tax in the way the costs orders have been presently formulated, whereas it would be, we would say, preferable to express them in the way that we suggest in the draft minutes.
The final issue, given that my 15 minutes have run out, is the question of certificates under section 6 of the Federal Proceedings (Costs) Act 1981 ‑ ‑ ‑
GUMMOW J: Now, in which appeals? Which numbers? 258?
MR BEACH: In 258 and 261 in the High Court and in the Full Federal Court, N219, N234 and N298. Now, there are monetary caps on those certificates. It ought not to be assumed that the financial benefit under which those certificates would work would be equivalent to a Bullock order. They would not, because there are statutory limits under the schedule to that Act. So we put that there as, I suppose, a fallback position, but a necessary position.
GUMMOW J: You have 219? Is that right?
MR BEACH: Yes, we have, your Honour. That is (ba) at the foot of page 2 of our minutes. There was an appeal and cross‑appeal on 219, and we have dealt with the certificate in relation to the appeal but obviously not the cross‑appeal which is dealt with on the next page.
GUMMOW J: Yes, I see. Thank you.
MR BEACH: If the Court pleases, those are our submissions.
McHUGH J: Thank you, Mr Beach. Mr Parker, I think we may hear from you. You support the orders generally, but you have some variations, do you not?
MR PARKER: Yes, and our position has changed a little since the written submissions were lodged. May I hand up the version which we now contend for as a fallback position to Mr Beach’s position, which is the result of some amendments which have been circulated recently. I should say at the outset, we are content with Mr Beach’s orders. If your Honours are persuaded to make those orders, we support that. Can I just address a number of individual, further matters.
The first change we suggest is the new order 2. That order reflects the fact, as Mr Beach has pointed out, that the Barclay companies made a double appeal – there was an appeal as against us – and there is no reason why they should not pay the costs of that appeal. The costs of that appeal should follow the event. So we seek order 2 to go in.
Secondly, in relation to S261, our proposed order 5 – that was the State’s appeal. We did not oppose that appeal and we did not have any submission to make about it. We say that therefore we should not be made liable for the costs of it, and the formulation of the order which has been circulated by the Court might be open to the interpretation that we would be liable for the State’s costs. Your Honour, I understand that to be uncontroversial between us and the State – in other words, the State accepts that position in relation to order 5. We have suggested a like change, which affects the appeal in the Full Court below, that is ‑ ‑ ‑
GUMMOW J: No 6, is it?
MR PARKER: 6(d).
GUMMOW J: Number of the appeal?
MR PARKER: N234 of 1999. Your Honour will see that we have taken the State out of the costs order in the Full Court. Again, that is accepted by the State. Could I ask your Honours now to go over to 6(g) on page 4, which are the orders below. In (g)(ii), we suggest that there be inserted the words “as against Barclay Oysters”. The reason for that is this. There was a claim put below in the pleadings as against us under the Trade Practices Act. That claim was not ultimately pressed. It failed, for the same reasons the other claims should fail, but we say that those words should be inserted to make it perfectly clear that the only thing left alive is the Trade Practices Act claim against Barclay Oysters, not any other claim that is put upon the pleadings.
Finally, we say this. It is perfectly clear that this was in substance not only a claim by the applicant against the Council but a claim by Barclay Oysters against the Council. Mr Beach has already referred to the fact that a cross‑claim was made which made an independent claim against the Council. We sent up a bundle of papers – I do not know whether your Honours have it, but that bundle that we sent up traces through the submissions at first instance, and again in the notice of appeal to the Full Court, and again in the submissions in the Full Court. The Barclay companies sought to have the Council made directly liable not only for damages which were said to be an indemnity against any liability they had to Mr Ryan, but also independently for losses that they had suffered in their business. They were claiming $1 million in damages for loss suffered in their business.
In those circumstances, our contention is that the substance of the case below ‑ there are in effect two plaintiffs against the Council and that Barclay Oysters, one way or another, should be made responsible for the Council’s costs. There are a number of ways in which that could be done. The first would be to make a Bullock order. That, of course, would exonerate Mr Ryan. The alternative, which is reflected in the orders which we have handed up and is shown as (v) on page 4 and on page 5 of our orders, would have the effect that if Mr Ryan is unable to meet those costs, Barclay should pay them.
GUMMOW J: Now, you want the present proposed (iv) to go out, at least as you have been developing.
MR PARKER: We saw that as being superseded by our proposed (v), your Honour.
GUMMOW J: Yes.
MR PARKER: The final alternative – and I am sorry, this is not recorded in this document – is simply that Barclays should be made equally liable with Mr Ryan. The effect of that would be that if they are both able to meet the judgment the costs will fall equally on the two of them – that is, the Council’s costs. But one way or another, we say there should be an order which will allow us to recover our costs against the Barclay companies to the extent that we are unable to recover them against Mr Ryan at the least.
Finally, your Honours, orders 6 and 7. Order 6 is consequential upon the reduction in the Full Court of the damages which were found and, I believe, is uncontroversial. Order 7, which is misnumbered 8 in the document ‑ ‑ ‑
McHUGH J: What do you mean, “uncontroversial”?
MR PARKER: I do not understand there to be any opposition by any party to the making of that order. Certainly, it has not been indicated to us that there is any opposition to making that order. And 7, which is misnumbered 8, is to deal with the fact that after the trial at first instance all three defendants then found liable – each contributed $10,000 to the $30,000 in damages, which were then awarded. The effect of the High Court’s judgment is that the judgment will stand as to $27,000 as against the Barclay companies. Therefore, we should be refunded our $10,000 and so should the State, and in order to do it conveniently and quickly we simply suggest that Barclays refund it direct to us.
HAYNE J: “Conveniently and quickly” really is just glossing over what you are trying to do, is it not? You are trying to get the $10,000 back from a deeper pocket than you think it might otherwise be.
MR PARKER: Well, your Honour, before the money was paid over, arrangements were made to secure the payment, and we had no doubt that Mr Ryan would be able to repay that money, and indeed that issue was explored, so ‑ ‑ ‑
HAYNE J: Why should you not simply stand on that?
MR PARKER: Well, we would be content to. We had proposed this approach, but if the Court is against that, then what should happen is that Mr Ryan should refund $10,000 to each of the Council and the State and then he can claim the money back from Barclays. Those are my submissions, your Honour.
McHUGH J: Thank you, Mr Parker. Yes, Mr Taylor.
MR TAYLOR: Your Honour, I think I can use the Court’s time best by saying we do not propose any variations to the orders that have been made other than those that Mr Parker has clarified in relation to the appeals that concern the State.
McHUGH J: Thank you, Mr Taylor. Yes, Mr Hoeben.
MR HOEBEN: Thank you, your Honours. Your Honours, there has been a blurring, with great respect, between the Trade Practices claims and the other three negligence claims. It emerges most obviously in the submissions of my learned friend, Mr Beach. He made four points – we do not want to say anything about point No 4, which is the certificate point. The first point seems to rely upon the fact that the Graham Barclay interests ‑ ‑ ‑
GUMMOW J: Well, perhaps we should know first: have you any further proposed draft of your own?
MR HOEBEN: We did submit to the Court a very minor variation to the draft orders which were submitted. It merely set out separate orders in favour of Distributors, which had got a costs order in the proceedings. We just tried to better reflect what the actual judgment said about costs in respect of Distributors. Otherwise, they were ‑ ‑ ‑
McHUGH J: Where is that reflected? Annexure B?
MR HOEBEN: You mean, to our submissions?
McHUGH J: Yes.
MR HOEBEN: No, this is a document which we sent to the Court, your Honours, after the draft was circularised – I am not quite sure – we have two copies, if I could – I am sorry, I thought these were ‑ ‑ ‑
McHUGH J: No, I have a copy.
MR HOEBEN: As you can see, the alteration is extremely minor. It just brings Distributors in.
McHUGH J: Yes, Mr Hoeben.
MR HOEBEN: Your Honour, the first point my learned friend Mr Beach made, that the Barclay company should ‑ ‑ ‑
GUMMOW J: I am sorry. Are these controversial, these changes you are making?
MR HOEBEN: Well, I am told by Mr Beach they are. In any event, they are the court orders which were circulated as a draft. We have made some minor changes. We are happy, essentially, with the draft.
Your Honours, the first point about the Barclay companies sharing the costs of the Council with Mr Ryan is really a variation of, if I can put it like this, the second element of a Bullock order. If one wants to summarise the principles which apply, it is the reasonableness of the joinder and then some conduct on the part of the guilty defendant which in some way led to the joinder of the innocent defendants, or the successful defendants.
Now, all that is said in point No 1 is that the Barclay companies in the course of this litigation vigorously made submissions ‑ and there was no evidence led – on the basis of their section 5 Law Reform (Miscellaneous Provisions) Act cross‑claims against the Council and also, early on at least, against the State. It goes no further than that. There was not a single piece of evidence led which lengthened the trials in any way below. All that was done was to make submissions based on the evidence led by others. We have taken the trouble, your Honours, to prepare a summary of the evidence, if that would assist your Honours. It indicates the witnesses, the length of cross‑examination, who carried it out, that kind of matter. Your Honours will find ‑ ‑ ‑
McHUGH J: No, we ‑ ‑ ‑
MR HOEBEN: Thank you, your Honours. I will not trouble you with that, but it is there if it would assist. So really what is being sought to be done in relation to point 1 is to bring in, if you like, that second leg of the Bullock order argument, and to say because the cross‑claim was vigorously pressed in submissions against the Council in some way that is conduct which ought be regarded as leading to the joinder of the Council. That is where the two principles have been elided, with great respect, your Honours. What ought be looked at is: what is the conduct which has been identified at any time by the Barclay companies which led to the joinder of the Council and led to the joinder of the State? Nothing has been identified.
The simple fact is – and one can look at it chronologically – that proceedings were brought under the Trade Practices Act against the Barclay companies. Separate proceedings, but dealt with in the same set of proceedings, were brought against the Barclay companies, the State and the Council in negligence, and there is no conduct identified by the Barclay companies which in any way encouraged that additional joinder.
Your Honours, in relation to my learned friend’s second point, the Bullock order point, he seems to take it as read that the reasonableness of the joinder can be established by the level of success in the first two levels of hearing, at first instance and on appeal. With great respect, one cannot ignore the ultimate outcome. It is the ultimate outcome against which one has to measure the Bullock order. What we say is the reasonableness argument is in fact quite controversial. In fact, it can be said that these particular claims – particularly against the State, your Honours might think ‑ were highly speculative, even at the time when they were brought, and they have now been shown to have been misconceived.
In any event, what cannot be escaped is that all of the negligence claims failed. With respect, your Honours, nothing has been put, either in writing earlier, or today, which in any way alters that basic situation that if you bring proceedings and they fail certain consequences flow. What also has not been established is the overlapping between the proceedings not brought by the applicant under the Trade Practices Act and against the Barclay companies, because that is irrelevant.
What has to be shown is some overlapping between the Trade Practices proceedings against the Barclay companies and the negligence proceedings against the State and the Council, and nothing like that has been established. It is irrelevant whether there was some interrelationship of arguments between the Barclay companies in defending the Trade Practices claims and in defending the negligence claims. That is not the point. The point has to be, with respect, in relation to Bullock orders, what was done by the Barclay companies which led to them either bringing in the Council and the State, or leaving them in, and nothing has been pointed to, with respect.
The cross‑allocation point, with respect, your Honours, arises, we would say, from a complete misreading of Smith v Madden. We have only just looked at that case, but the passage on which my learned friend relies, with respect, deals with a totally different situation based on a conventional common law case, where what you look at is orders – you do not look at issues. I would have thought that is so fundamental to a basic appeal process it does not require any further comment. Quite obviously, what the Court was saying is you do not look at individual issues and cost those out unless special circumstances arise, and, with great respect, your Honours, that has not happened here.
In relation to the matters that my learned friend Mr Parker raised, in a sense, he raises the same point. He says that throughout the proceedings, the Barclay companies have tried to implicate the Council. Yes, they have, but they have in submissions. They have not in any other way. There has been no step taken which in any way, with great respect, your Honours, has lengthened the proceedings except perhaps an hour or so by counsel on their feet in the course of submissions.
In relation to order 5 in Mr Parker’s draft orders, we do not understand that submission, with great respect. There is nothing that we did in the High Court which in any way sought to implicate the State. There was not a single word in our written submissions, nor was there an oral submission made against the State, so why order 5 ought be made when nothing was said against the State by the Barclay interests is not clear. The very same argument that Mr Parker seeks to rely upon as to why the Council should not make any contribution applies equally to Barclays. Nothing was said against the State. That appeal was allowed to run entirely between Mr Ryan and the State.
Submissions have been made, your Honours, in relation to the cross‑claim which the Barclay companies brought against the Council. There were two cross‑claims, with respect, your Honours. There was the section 5 contribution cross‑claim, there was a separate cross‑claim based on if the Barclay companies were found liable under the Trade Practices Act seeking to recover or recoup the damages. Well, that second cross‑claim, which is the one that both my learned friends Mr Beach and Mr Parker have referred to, was expressly reserved. Justice Wilcox would not deal with the damages side – that was expressly reserved – and when he delivered his judgment he referred to but did not decide that particular cross‑claim.
The same approach was followed by the Full Bench of the Federal Court. They said it is there, it has to be litigated at some other time. Your Honours, I think, can be reasonably confident it never will be, in view of the primary judgment – but that is neither here nor there. So the fact that we issued a cross‑claim, apart from our contribution cross‑claim, is, with great respect, irrelevant. It did not lengthen the proceedings. It did not lead to anyone being left in who otherwise would have been let out. It has never been suggested here that if it had not been for certain conduct by the Barclay interests one or other of the Council or the State would have been let out. So, with respect, your Honours, none of these points have been established. Otherwise, your Honours, we rely on our written submissions.
McHUGH J: Thank you. Yes, Mr Beach.
MR BEACH: Your Honour, just dealing with Mr Hoeben’s submissions first, the fact that the cross‑claim has not been finally disposed of is not to the point. The fact is that there was a cross‑claim, that the issues dealt with in the main claims of Mr Ryan were going to assist also in relation to the disposition of the cross‑claim, including the independent damages claim. So it matters not that there is no final order yet on the cross‑claim. The fact is that, in terms of the case against the Council, the case Mr Ryan put was also advanced in, or as part of, the interests of the Barclay entities in relation to the cross‑claim.
The second point is that it really matters not whether you can point to any conduct of Graham Barclays that extended the trial that Mr Ryan was being run, because if the trial has this dual advantage to the Barclay entities then that is the point that would justify the question of the cost apportionment of the Council’s costs. So we do not have to point to anything to show that there was an additional week of Mr Hoeben cross‑examining witnesses to get up in terms of establishing the costs apportionment question.
The third point is that Justice Lee in the Full Federal Court expressly stated that – this is at paragraph 77 – it was reasonable for us to join both of the public authorities. So putting aside what Justice Wilcox has said and done, certainly, in the Full Federal Court the reasonableness of our joinder of the State and the Council was hardly denied, and not denied by any party. It is denied now with the benefit of hindsight, with the High Court’s decision, but not denied at the time, when you are looking at what was reasonable at that particular stage and, ipso facto, what was reasonable at the time that the trial was carried out.
We say that it confuses two issues to look at the ultimate result in the High Court and to work backwards from that and say, “Well, ipso facto, we should have all anticipated that result. Therefore it follows that it was unreasonable to pursue these claims; therefore a Bullock order is inappropriate and the costs apportionment of the Council’s cost is also inappropriate”. I have already addressed the question of the artificiality of distinguishing between the Trade Practices Act claims on the one hand and the claims of negligence against a manufacturer on the other, and I will not repeat what I said.
Mr Hoeben also seems to want to put the principle that we have to show that there was conduct on the part of Barclay Oysters or Barclay Distributors that encouraged the joinder. We do not have to put any such case at all. It is a question of looking at whether or not it is reasonable and appropriate for the unsuccessful defendant to bear the successful defendant’s costs. The Bullock Case itself and the Sanderson Case never required such a stipulation, that we show that there was positive conduct by the unsuccessful defendant that encouraged the joinder of the successful defendant ‑ ‑ ‑
McHUGH J: But that is contrary to what Justice Gibbs said in Gould v Vaggelas. His Honour said it was not sufficient that it was reasonable to join them. He said obviously a judge should make a Bullock order only if it was just to do so, and, ordinarily, it would not be just unless there was something said or done by the unsuccessful defendant that led to the bringing of these actions.
MR BEACH: Ordinarily, that might be the case, and certainly if there is such conduct, that would establish a very strong justification for the Bullock order. Gould v Vaggelas was a classic type of that case, where you had the Vaggelas entities saying, “You the purchaser did not rely upon me, the vendor. You the purchaser relied upon your own accountant”. So you can understand the exposition of what Justice Gibbs said in that light. But he was not setting down for all time a necessary condition for the exercise of discretion in favour of the making of a Bullock order.
McHUGH J: Of course, he could not freeze the discretion in that way, but it is a startling proposition that a party can bring actions against defendants, succeed against one, lose against the others, and somehow or other have a prima facie claim to a Bullock order.
MR BEACH: Well, that is not the present case. We were not even running alternative claims, where you might say the unsuccessful defendant ‑ ‑ ‑
McHUGH J: It seems to me there was just no connection with your case against Great Lakes Council and the State and your action against Barclays.
MR BEACH: Well, certainly, the Full Federal Court, all three judges ‑ ‑ ‑
McHUGH J: Do not worry about what the Full Federal Court thought. The majority in this Court thought otherwise.
MR BEACH: But you need to put yourself back at a point in time when we do not have the decision of this Court ‑ ‑ ‑
McHUGH J: No, you do not. You have to look at it now to see whether it was just for you to do so. Otherwise, on that basis, at any time that you succeeded along the line you would be able to point to that and say it was reasonable.
MR BEACH: No. You look at the matter whether it was just now, but to inform yourself as to that concept of what is just you need to look at the state of the law back in 1997, even around the time when there was Pyrenees, and consider the question whether or not it was reasonable, in the light of the law as it then existed, to join and pursue all of the entities that were responsible for the quality of the growing environment – not using “responsible” in terms of any legal criteria, but in terms of, if you have a case where the defect in the manufacture is the growing environment, the reasonableness of joining the entities who specifically have powers or can do things or do not do things in relation to that context. Hence, you have the manufacturer and you have the Council and the State.
As I say, the section 74B defence necessarily brings in questions of reasonableness on the part of the manufacturer, which we say necessarily bring into the equation concepts of negligence. All that I say is that it is not right to say that a necessary condition for the establishment of a Bullock order is that we have to show that there is conduct on the part of Graham Barclays that encouraged the joinder. You could look to conduct after the event. The way Graham Barclays ran its case was to point the finger at the Council, and it did so to such an extent where it was pursuing its own cross‑claim. It thought it was in its commercial interests to make a separate damages claim under its cross‑claim, which picks up the same formulations of the duty of care and breach that we have pleaded in our statement of claim. So if it is necessary to establish some conduct, we would say that is the conduct, but we do not accept that is the test.
McHUGH J: But how did that conduct encourage you to bring your action?
MR BEACH: We say that you do not have to show necessarily prior conduct on the part of the growers to justify the joinder of parties. We would say you look at the reasonableness and appropriateness of a joinder of the parties and then you look at the conduct of the manufacturer, whether before or after the institution of the proceedings, and consider in the light of all of the circumstances whether it is reasonable and appropriate for that unsuccessful defendant to bear the costs of the successful defendant, not limited by prescriptions such as some positive conduct where they wrote us a letter saying, “We are not liable – this other entity is liable”.
We say that all the cases point against such a principle, including the decision of the Court of Appeal in Besterman v British Motor Cab Company [1914] 3 KB 181. We say that the High Court did not intend in the Gould v Vaggelas case to lay down such a principle, that we needed to show some positive act prior to the joinder or the commencement of the proceedings that encouraged us to join the Council or the State.
Now, in terms of the minutes put up by Mr Hoeben which seek to deal with the position of the Barclay Distributors entity, we oppose such amendments. The fact is that Oysters and Distributors had common representation, were putting a common case at all levels, except that in relation to certain of the Trade Practices claims there was a limited argument, particularly in relation to section 74D, which arguably also applied to Barclay Distributors as to whether or not it was liable or not. That separate legal argument was dealt with by Justice Wilcox at paragraph 380 of his decision. So, as a matter of substance, Barclay Distributors was there with Barclay Oysters. There were no, in substance, incremental costs associated with Barclay Distributors’ participation in the proceedings at any level.
Because your Honours have, in a sense, indicated through the draft minutes that Mr Ryan have the benefit of an order for costs in his favour from Barclay Oysters, we are concerned that costs orders in favour of Barclay Distributors will cancel out the orders in his favour in circumstances where it is in a wholly unrealistic position to deal with Barclay Distributors as if it was some separate entity with separate representation and with separate sets of costs.
That is the general point that we say to all of the amendments made in the Hoeben draft, that they are designed to achieve that effect. Although they look seductive, they really, in terms of the commercial effect of them, would really deny to us the benefit of our costs order. Can I deal with a number of other technical issues. In the High Court’s ‑ ‑ ‑
HAYNE J: At this rate, Mr Beach, you are going to have about 20 minutes in reply, I suspect.
MR BEACH: Well, it is only technical issues in relation to the formulation of the orders. They are not points of principle. In your Honours’ draft, 5(g)(iv), your Honours there provided that the:
Second respondent pay part of the first respondent’s costs of the proceeding being the costs of the issues raised by the first applicant’s claims under the Trade Practices Act –
We had read that as being perhaps a typographical error, that what your Honours really meant was that the second respondent pay part of the first applicant’s costs of the proceeding. I would not have raised it, but Mr Parker seemed to indicate, as I understood him, that on his minutes (g)(iv) would become unnecessary. But, of course, that is a necessary order, with the modifications that we have suggested in our draft minutes; (g)(iv) is necessary, but we suspect that something might have gone wrong in the ‑ ‑ ‑
GUMMOW J: Well, the first applicant is Mr Ryan, is it not?
MR BEACH: Yes. We had read that, that your Honours intended to give Mr Ryan a costs order in his favour against Barclay Oysters in relation to the Trade Practices claims. Hence, my submission about whether you should be making issue specific orders or giving us the general costs and then carve out incremental costs associated with issues upon which we lost.
MR HOEBEN: Your Honours, we accepted that, and we put that into our draft.
MR BEACH: Yes, it was just that Mr Parker had perhaps by a side wind taken it out that ‑ ‑ ‑
McHUGH J: Right. Yes, well, your next point.
MR BEACH: The next point is I omitted to explain that in (iii), where your Honours have provided “Otherwise application dismissed”, in fact there are a number of applicants that have their Trade Practices claims that are no part of this current stage of the litigation, so our minutes provide that it is only that part of Mr Ryan’s personal claim or representative claims that be dismissed, not the application in its entirety, because there are many other applicants who are representing ‑ ‑ ‑
HAYNE J: What do you consider the effect of (ii) is?
MR BEACH: Well, that is just dealing with the first applicant’s representative claim. There are the second applicant, who has a personal and a representative claim, third applicant, fourth applicant, fifth applicant, sixth applicant. So there are other applicants who represent other groups because there are Trade Practices claims against the intermediate suppliers or the wholesalers that took no part in this proceeding. So our minutes are designed to reflect that you ‑ ‑ ‑
GUMMOW J: Well, would (ii) be met by:
So much of the first applicant’s representative claim as alleges an entitlement –
“and all other representative claims”?
MR BEACH: “All other personal and representative claims of other applicants”, yes.
HAYNE J: “Personal and”?
MR BEACH: Yes, because some of them have a personal claim against an intermediate wholesaler, but also bring that claim in their representative capacity, acting on behalf of group members who can trace their source of oyster supply back to those intermediate wholesalers. The final point on that is ‑ ‑ ‑
HAYNE J: The whole point of providing these draft orders in anticipation, Mr Beach, was so that we would not end up spending time drafting in group.
MR BEACH: I accept that.
HAYNE J: That they would be put in writing.
MR BEACH: Yes, I accept that. We have put submissions – this morning, we put some draft minutes ‑ ‑ ‑
HAYNE J: Get on with it, Mr Beach.
MR BEACH: In paragraph 5(f), the first respondent was in fact described as all of the applicants at first instance, not just Mr Ryan, so it should read “Mr Ryan” to be very, very clear – to separate out all of the other co‑applicants, because the notice of appeal of the State of New South Wales had as the first respondents ‑ ‑ ‑
GUMMOW J: So it is really “Mr Ryan, as one of the first respondents”.
MR BEACH: Yes, your Honour.
McHUGH J: Yes, anything further? Thank you, Mr Beach.
MR PARKER: Your Honours, would you hear me briefly in response to Mr Beach?
McHUGH J: Yes, Mr Parker.
MR PARKER: Does the Court have the folder of material we sent up?
McHUGH J: Yes.
MR PARKER: Could I just give your Honours references in that to the Barclay cross‑claim. Page 3, your Honours will find the independent Barclay cross‑claim, which starts at paragraph 7, and your Honours will see on the following page, page 4, at paragraph 8A, there was sought an indemnity, in effect, against any judgment that might be made against the Barclay companies, but in 9, further, there was another $958,000 in losses claimed. That was the loss that I was referring to before. Then if your Honours look at the notice of appeal, and your Honours go to page 96 of the folder, which is behind tab 4, your Honours will see in ground 3 it is said:
His Honour erred in holding that it was not necessary to determine whether the Great Lakes Council (“the Council”) owed a duty of care to the oyster growers, and should have so held in the light of the cross‑claim by the Barclay Companies against the Council. His Honour should have found that a duty of care was owed by the Council to the Barclay Companies –
and so on. Page 125, which is behind tab 5, at paragraphs 58 and 59, submissions were put to the Full Court in support of that proposition.
Now, we accept, with respect, that the question of whether somebody has reasonably been joined is a question which is relevant to whether a Bullock order, strictly speaking, ought to be made – that is, whether the plaintiff should be relieved of any costs liability at all. But we say that it is no answer to the proposition that a party who involves itself in litigation with a view to gaining its own advantage from that litigation should not, at the least, be jointly liable to the successful defendant. Those are the submissions, if your Honour pleases.
McHUGH J: Thank you. Mr Taylor, I take it there is nothing ‑ ‑ ‑
MR TAYLOR: No, your Honour.
McHUGH J: The Court will retire for a short while to consider what course it will take in this matter.
AT 2.54 PM SHORT ADJOURNMENT
UPON RESUMING AT 3.25 PM:
McHUGH J: Having read the written submissions of the parties and heard counsel this afternoon, the Court is of the opinion that it should make the following orders.
Matter No S258 of 2001, Graham Barclay Oysters Pty Limited and Another v Grant Ryan and Others:
1. Appeal by each of Graham Barclay Oysters Pty Limited and Graham Barclay Distributors Pty Limited allowed in part.
2(a) Barclay Oysters and Barclay Distributors each to bear its own costs of all the proceedings in this Court but otherwise there is no order as to the costs of the appeal by those parties.
2(b) Mr Ryan to have a certificate under section 6 of the Federal Proceedings (Costs) Act 1981.
Matter No S259 of 2001, Grant Ryan v Great Lakes Council and Others:
3. Appeal dismissed with costs.
Matter No S261 of 2001, State of New South Wales v Grant Ryan and Others:
4(a) Appeal allowed with costs to be paid by Mr Ryan.
4(b) Mr Ryan to have a certificate under section 6 of the Federal Proceedings (Costs) Act 1981.
5. Set aside the orders of the Full Court of the Federal Court of Australia made on 9 August 2000 and in their place order as follows:
Appeal No N219 of 1999, Graham Barclay Oysters Pty Limited and Another v Grant Ryan and Others:
(a) Appeal allowed in part.
(b)(i) Barclay Oysters pay part of Grant Ryan's costs of this appeal to the Full Court being the costs of the appeal related to the issues raised by Grant Ryan's claims under the Trade Practices Act 1974 (Cth).
(b)(ii) Mr Ryan to have a certificate under section 6 of the Federal Proceedings (Costs) Act 1981.
Cross-Appeal No N219 of 1999, Grant Ryan v Graham Barclay Oysters Pty Limited:
(c) Cross-appeal dismissed with costs.
Appeal No N234 of 1999, Great Lakes Council v Grant Ryan:
(d)(i) Appeal allowed with costs to be paid by Mr Ryan.
(d)(ii) Mr Ryan to have a certificate under section 6 of the Federal Proceedings (Costs) Act 1981.
Appeal No N298 of 1999, State of New South Wales v Grant Ryan and Others:
(e) Appeal allowed.
(f)(i) Mr Ryan as one of the first respondents to pay appellant's costs of the appeal but otherwise there is no order as to the costs of the appeal.
(f)(ii) Mr Ryan to have a certificate under section 6 of the Federal Proceedings (Costs) Act 1981.
(g) Set aside the orders of Wilcox J made on 5 March 1999 and in their place order as follows:
(i) Judgment for first applicant, Grant Ryan, against the second respondent, Barclay Oysters, in the sum of $27,000 in respect of the first applicant's personal claim under the Trade Practices Act 1974 (Cth).
(ii) So much of the first applicant's representative claim as alleges an entitlement to recover loss or damage under the Trade Practices Act 1974 (Cth) and all other applicants' claims under that Act are stood over for further hearing and determination by a single Judge.
(iii) Otherwise application dismissed.
(iv) Second respondent pay part of the first applicant's costs of the proceedings being the costs of the issues raised by the first applicant's claims under the Trade Practices Act 1974 (Cth).
(v) The first applicant pay the respondents, other than Barclay Oysters, their costs of the proceeding.
(vi) The first applicant to refund $3,000 to Barclay Oysters together with interest at Court rates as specified in the Rules of the Federal Court Order 35 rule 8 from the date of payment to the first applicant.
The Court will now adjourn.
AT 3.29 PM THE MATTERS WERE CONCLUDED
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