Harris v Harvey and Ors (Ruling)

[2012] VCC 1048

IN THE COUNTY COURT OF VICTORIA Revised
Not Restricted

AT MELBOURNE

DAMAGES AND COMPENSATION LIST
GENERAL DIVISION

Case No.  CI-11-00246
CI-11-00248

CAMERON HARRIS
and
MONICA HARRIS	Plaintiffs
v
MARK HARVEY	Defendant
and
BRAD TEAL REAL ESTATE PTY LTD (ABN 49 007 018 171)	First Third-Party
MAROONDAH CITY COUNCIL	Second Third-Party
ARTHUR SMITH	Third Third-Party
SNAP CONSTRUCTIONS PTY LTD (ACN 065 811 841 - deregistered)	Fourth Third-Party
DENNIS CAMPANO	Fifth Third-Party

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JUDGE:	HIS HONOUR JUDGE MISSO
WHERE HELD:	Melbourne
DATE OF HEARING:	3 August 2012
DATE OF RULING:	6 August 2012 (Revised)
CASE MAY BE CITED AS:	Harris v Harvey & Ors (Ruling)
MEDIUM NEUTRAL CITATION:	[2012] VCC 1048

RULING

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SUBJECT: PRACTICE AND PROCEDURE

CATCHWORDS: Third-party notice served out of time – s24(4)(a)(ii) of the Wrongs Act 1958 – orders made on the papers to extend time – application to set aside those orders pursuant to r46.08 of the County Court Civil Procedure Rules 2008 – application to serve the third-party notice out of time – third-party notice potentially barred by the provisions of the Limitation of Actions Act 1958 – whether leave to serve the third-party notice out of time would deny the third parties of a defence under the Limitation of Actions Act 1958
LEGISLATION: Wrongs Act 1958, s24(4)(a)(ii); Limitation of Actions Act 1958; County Court Civil Procedure Rules 2008, r5.12(2) and 46.08
CASES CITED: Savcor PtyLtd v Cathodic Protection International APS (2005) 12 VR 639; Ramsay v Madgwicks (a firm) [1989] VR 1
RULING: the orders made extending time to serve the third-party notice are set aside, and the third-party notice is struck out as against the first third-party, the second third party, the third third-party and the fourth third-party.          

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr R Stanley	Slater & Gordon Ltd
For the Defendant	Mr M Martin (solicitor)	Moray & Agnew
For the First Third-Party	Mr C Smith	Lander Rogers
For the Second and Third Third-Parties	Ms J Morris (solicitor)	Minter Ellison
For the Fourth Third-Party	No appearance	-
For the Fifth Third-Party	Mr D Harrison	Davis Zucco

HIS HONOUR:

Introduction

1       The plaintiffs are the parents of Lauren Harris, who died tragically by drowning in a pool in the garden of a house which they rented from the defendant.  They each filed a proceeding against the defendant claiming damages for the injuries which they suffered as a result of the death of their daughter.

2       The plaintiffs each filed a Writ on 27 January 2011.  The Writs were served upon the defendant on 3 March 2011.

3       The defendant filed a Third-Party Notice on 2 March 2011 seeking contribution from Brad Teal Real Estate Pty Ltd (the first third-party); the Maroondah City Council (the second third-party); Arthur Smith (the third third-party); Snap Constructions Pty Ltd (the fourth third-party) and Denis Campano (the fifth third-party).  Mr Martin informed me that Snap Constructions Pty Ltd has been deregistered, and as a result, the defendant will not proceed against it.

4 Section 24(4)(a)(ii) of the Wrongs Act 1958 provides that where a party is entitled to recover contribution in respect of any damage from any other person, a proceeding to recover contribution may be commenced within the period of twelve months after the writ was served on the other person. The period of twelve months expired on 3 March 2012.

5       Mr Martin candidly conceded that the Third-Party Notice was served out of time.  An application was made to Judge Davis for an order that the time for the defendant to serve the Third-Party Notice be extended to 15 June 2012 nunc pro tunc.  That order was made on 28 May 2012 in proceeding number CI-11-00248, and on 29 May 2012, in proceeding number CI-11-00246.  The Third-Party Notice was served on each of third parties.  It was served on the first third-party on 9 May 2012.

6       Mr Smith, who appeared for the first third-party, firstly applied for the orders made by Judge Davis to be set aside, and to then be heard on the application.  Ms Morris, who appeared for the second third-party and the third third-party, joined in that application.  Mr Harrison, who appeared for the fifth third-party, did not join in that application.  He informed me that the fifth third-party did not raise any technical or substantive objection to service of the Third-Party Notice upon him.

7 It seems to me to be entirely proper to set aside the orders for the reasons which I will set out below. The power to set aside the orders is found in Rule 46.08 of the County Court Civil Procedure Rules 2008. In any event, Mr Martin quite properly referred me to the Rule, and did not raise any objection to the orders being set aside.

The Application

8       I will firstly turn to the submissions made by Mr Smith.  Mr Smith referred me to a number of authorities which are relevant to the extension of the service of a writ pursuant to Rule 5.12(2).  By analogy, the authorities equally apply to an application to extend the period of time for service of a third-party notice.

9       Essentially, whether the period of time should be extended is discretionary.  In Savcor PtyLtd v Cathodic Protection International APS,[1] Gillard AJA summarised the considerations guiding the exercise of discretion as follows:

[1](2005) 12 VR 639

“The principles which guide a court on an application to extend the period for service have been discussed in Van Leer Australia Pty Ltd v Palace Shipping KK, Irving v Carbines, especially at p 865, Ramsay v Madgwicks (a firm) and Kleinwort Benson Ltd v Barbrak Ltd.  Those cases establish the following general propositions:

(i)       It is the duty of the plaintiff to serve the writ promptly.

(ii)  There must be a good reason for the grant of an extension, and if the application is made after the period has expired the reason must be one of substance.

(iii) It is not possible and indeed is unwise to attempt to define the circumstances which amount to a good reason. It is trite observation but not very helpful that whether or not it is a good reason must depend upon all the circumstances of the particular case. As a general proposition difficulties serving the writ within the 12-month period will usually establish a good reason, for example where the defendant is evading service, his whereabouts are unknown or some other difficulty is experienced in serving the defendant.

(iv) By reference to decided cases it is possible to compile a list of the circumstances which constitute a good reason. The cases also provide examples where the circumstances have not been a good reason to extend the period of validity. For example, it is not a good reason that negotiations are continuing between the parties, or legal aid has not been granted and the plaintiff is waiting for the grant. There are cases which say that the latter proposition is not a good reason. But in Waddon v Whitecroft-Scovill Ltd it was said delay caused by the authorities to grant aid may be a good reason. Other examples which have not found favour are difficulty tracing witnesses or obtaining evidence.

(v)  The Australian cases differ from the English cases as to the effect of a limitation defence arising after the issue of a writ but before the application to extend the validity of the writ. The difference is traced by Stephen J in Van Leer Australia Pty Ltd v Palace Shipping KK.  His Honour preferred the approach of the Australian and Canadian courts.

He quoted with approval what Bray CJ said in Victa Ltd v Johnson.   Bray CJ stated that there was no rule that a defendant acquired an absolute right to immunity when a writ issued within the limitation period is not served and in the meantime the period expires. The English cases had stated a test that if the limitation period had expired it was only in exceptional circumstances that the writ would be renewed.  This is not the Australian position.”[2]

[2]at 651-2

10      In connection with the reference to the Australian position regarding the expiry of a limitation period, it was a factor which was considered relevant to the exercise of discretion in Ramsay v Madgwicks (a Firm).[3]  Mr Smith referred me to some other authorities which contain references to the importance of the expiry of the limitation period, but, having read them, I am not convinced that they are of much assistance.

[3][1989] VR 1 at 7

11      The evidence which was adduced during the hearing of the application comprised an affidavit sworn by Mr Martin on 24 July 2012, together with eight exhibits and an affidavit of Ms Morris sworn 27 July 2012.

12      Mr Smith was very critical of the content of Mr Martin's affidavit, submitting that it does not condescend to a good reason for the delay in serving the Third-Party Notice.

13      The authorities which Mr Smith took me to all pre-date the Civil Procedure Act 2010. There is a tension between the considerations referred to in those authorities. What underwrites the Act is stated clearly in section 1(1), which is to reform and modernise the laws, practice, procedure and processes relating to the resolution of civil disputes, and section 7(1), which speaks of the overarching purpose of the Act to facilitate the just, efficient, timely and cost-effective resolution of the real issues in dispute. 

14      Furthermore, PART 4.2 – Case Management, seems to me to invite the Court to reconsider former considerations which might result in unnecessary cost and expense.  For example, if no good reason were advanced in applications such as this, then would it be just, efficient, timely and cost-effective to deny an extension of time which would then lead to the Third-Party Notice being struck out, but permitting a further Third-Party Notice to be filed and served?  This hardly seems to meet the dynamic which resonates in the provisions of the Act.

15      If there was no issue relevant to the Limitation of Actions Act 1958, then I would have had no hesitation in extending the time for the service of the Third-Party Notice. However, it is only because there may be such a defence available at the suit of the first third-party, the second third-party and the third third-party, that I propose to strike out the Third-Party Notice as against those third parties, and, of course, the fourth third-party, because it is deregistered.

16      Mr Martin submitted that there is no merit in the limitation of actions defence.  He took me to the Amended Statement of Claim, and in particular, to paragraphs which demonstrate that such a defence will fail.  However, I am not prepared to determine whether there is any merit in the limitation of actions defence on the pleadings, and in particular, because Mr Stanley informed me that the Amended Statement of Claim is a draft, leave has not been sought to file and serve it. 

The Next Steps

17      It follows that I will make orders setting aside the orders made by Judge Davis on 28 and 29 May 2012, and strike out the Third-Party Notice as against the first third-party, the second third-party, the third third-party and the fourth third-party.

18      I was left with the understanding that if I ruled against the defendant, that it would file and serve a fresh third-party notice against the first third-party, the second third-party and the third third-party.  On the assumption that the defendant will do so, and on the assumption that those third parties will rely upon the provisions of the Limitation of Actions Act 1958, then procedural orders will be required not only in connection with such a defence, but also general procedural orders.

19      Furthermore, although Mr Stanley applied belatedly to have leave to file and serve the Amended Statement of Claim, I was not prepared to give him that leave unless and until notice was given to the defendant and Brad Teal Real Estate Pty Ltd of the plaintiffs’ intention to do so.

20      I will make formal orders based upon the primary issue that I was required to determine.  I will entertain the plaintiffs’ application to amend the Statement of Claim, and I will entertain any other applications relevant to any residual matters arising out of this ruling, and relevant to any required procedural orders.  I propose to list this matter for a further directions hearing at 9:30 am on 17 August 2012.

21      I have authorised my Associate to email this ruling to the parties with my orders in advance of the next directions hearing in the expectation that the defendant will file and serve a substituted third-party notice; the plaintiffs will give notice of their intention to apply for leave to amend the Statement of Claim, and that the parties will do their best to determine what procedural orders will be required and then be a position to address me on those orders of which there is agreement so that I can rule on any outstanding matters.

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