Howard Haulage Pty Limited v Mutton

[2007] NSWSC 237

CITATION:	Howard Haulage Pty Limited v Mutton & ors [2007] NSWSC 237
HEARING DATE(S):	23rd February 2007 16 March 2007
JUDGMENT DATE :	19 March 2007
JUDGMENT OF:	Sully J at 1
DECISION:	Leave to plaintiff to adduce evidence placed contingently before the Court at the hearing on 16 March 2007; Verdict for plaintiff for $59,242.42 plus costs as agreed or taxed; Judgment may be entered forthwith
LEGISLATION CITED:	Law Reform (Miscellaneous Provisions) Act 1946 (NSW) Workers Compensation Act 1987 (NSW)
CASES CITED:	Urban Transport Authority of NSW v Nweiser (1992) 28 NSWLR 471
PARTIES:	Howard Haulage Pty Limited Hazel Mutton, Warren Mutton & Neal Mutton as Executors of the Estate of the late Maxwell Mutton & anor.
FILE NUMBER(S):	SC 20156/05
COUNSEL:	D. J. Hooke - Howard Haulage Pty Limited N. E. Chen - Mutton & ors.
SOLICITORS:	Edwards Michael - Howard Haulage Pty Limited Kennedys - Mutton & ors.

IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

SULLY J

19 March 2007

20156/05 – HOWARD HAULAGE PTY LIMITED v MUTTON & ORS

JUDGMENT

1 SULLY J: In November last year the Court heard, jointly by consent, two actions at common law.

2 The first action, numbered 20375 of 2004, was an action brought by a Mr. Kelman in order to recover compensatory damages for personal injury suffered by him in a workplace incident. The incident occurred on a rural property then owned and occupied by Mr. Robert Mutton jointly with his brother, Mr. Maxwell Mutton. Before action brought, Mr. Maxwell Mutton died; and so Mr. Kelman brought his action against Mr. Robert Mutton and the executors of the estate of his late brother. Those defendants cross-claimed against Howard Haulage Pty Limited, Mr. Kelman’s employer. The cross-claim sought contribution pursuant to the relevant provisions in that behalf of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).

3 The second action numbered 20156 of 2005 was brought by Howard Haulage Pty Limited against Mr. Robert Mutton and the executors of the estate of his late brother. This claim was one for the statutory indemnity which is provided by section 151Z(1)(d) of the Workers Compensation Act 1987 (NSW) in connection with payments which have been made pursuant to that Act to or for or on behalf of a worker who subsequently recovers common law damages.

4 As I have noted, both actions were heard together; it being agreed that the evidence in either would be evidence in both.

5 When the matters were called on for hearing on 21 November 2006, the Court was informed that the defendants whom Mr. Kelman had sued had settled his claim upon the footing of a consent judgment for $650,000 plus costs.

6 On 29 January 2007 I handed down a reserved judgment in which I found for the cross-defendants in the cross-claim. I stood over the further consideration of the indemnity proceedings. On Friday last I heard a little evidence and then further submissions in connection with those proceedings. Judgment in the indemnity proceedings was thereafter reserved.

7 It is not now controversial that, all other things being equal, Howard Haulage Pty Limited is entitled to a verdict and judgment such as would properly satisfy its statutory entitlement pursuant to section 151Z(1)(d) of the Workers Compensation Act. Neither is it controversial that the only amount that is now outstanding in that connection is an amount of interest in the sum of $59,242.42, together with appropriate costs as either assessed or taxed.

8 It is contended, however, by the defendants in the indemnity proceedings that all other things are not equal; and that on a correctly principled approach the plaintiff in these indemnity proceedings ought to be deprived of any such interest or costs.

9 In order to examine the way in which that contention is structured, it is convenient to take as a starting point some extracts from the written submissions that were handed up on Friday last by learned counsel for the defendants.

“4. It is tolerably clear, therefore, that for the employer to recover interest on the payments it has made, it was required to establish when each of the payments of compensation were (sic) made. It did not do so, and the evidence closed.
…………………………………………………………
15. ………The simple fact is that the employer claimed interest as part of its claim. To succeed on this issue it needed to adduce evidence. It never formally or informally sought a concession to obviate the need to call this evidence. It is not the obligation of the cross-claimant to advise the employer on how it ought conduct its case.
16. The first time the issue was raised by the employer was in its submissions delivered after the conclusion of the case pursuant to leave. The submissions of the cross-claimant took issue with the employer’s entitlement. Despite this, no step was taken to have the matter re-listed. Rather the employer permitted the delivery of judgment.”

10 A correct understanding of those quoted submissions entails an examination of the closing stages of the hearing in November last.

11 Towards the close of the present plaintiff’s counsel’s oral submissions, I raised with him some practical difficulties that I then apprehended in connection with the quantification of an entitlement pursuant to the statutory indemnity that is provided by section 151Z(1)(d). I concentrated my own remarks upon the proposition that I would need to have some accurate information about the timing of the payment to Mr. Kelman of the agreed amount of his damages; and about the timing of the refunding, for which the Terms of Settlement provided, of payments previously made pursuant to the Workers Compensation Act. At T 191 the following is recorded:

“HIS HONOUR: Is there not a simpler way, can nobody tell me when it is proposed to make the payments under the judgment?
HOOKE: I can’t tell your Honour that.
HIS HONOUR: Of course you can’t but I imagine Mr. Chen can. There must be some simple way of dealing with the matter.
HOOKE: One would think that would be so. Your Honour, that then would give rise to a question of concession of the claim and consequential orders in relation to interest under section 101 of the Civil Procedure Act , interest after judgment, which would be an entitlement which would flow as a matter of course.”

12 Shortly thereafter learned counsel for the present defendants put oral submissions. They propounded, so far as is at present relevant, that the indemnity claim must necessarily fail should any contribution ordered in the separate contribution cross-claim exceed in amount the amount of antecedent workers compensation payments. That was accepted by learned counsel for the present plaintiff.

13 The submissions of learned counsel for the defendants then proceeded to develop the argument that the defendants, being entitled to contribution, were entitled to it in an amount sufficient to extinguish as a practical matter the present plaintiff’s right to the section 151Z(1)(d) indemnity. At T 195, learned counsel for the present defendants is recorded as having put:

“The question of interest and how your Honour would make findings upon it is an entirely different matter.”

I cannot find in the transcript any further oral submissions from counsel upon that topic.

14 Learned counsel for the present plaintiff then asked to be heard briefly. He submitted, (T 206, 207):

“………………. Assuming my client is successful in resisting the contribution claim to an extent, either entirely or to an extent, which leaves an amount to which it is entitled to indemnity. Your Honour, that is the question of interest. I will include in the note an authority for the proposition that interest runs on the indemnity, but also, your Honour, to say this and, that is, that section 100(2) of the Civil Procedure Act provides for interest to be included in the judgment even where payment of the amount the subject of the claim is made before judgment is given or entered up. So even if the judgment’s paid or there is reimbursement made of the payments of statutory compensation, that would not foreclose a claim for interest. So I’ll give your Honour a calculation of interest and the rates and periods in a note with the authority for the proposition that it runs.”

15 Thereafter I gave some directions for the filing of further written submissions; and reserved judgment.

16 Written submissions dated 1 December 2006 were lodged by learned counsel for the present defendants. So far as is at present relevant, they propounded:

“17. It is not disputed that, in ordinary circumstances, a successful claim for a statutory indemnity (including a partial one) entitles the employer to an award of interest on payments made from time to time.
18. Howard Haulage adduced no evidence of when the payments of compensation were in fact made.
19. It is not accepted that there is some ‘convention’ for the awarding of interest in claims for statutory indemnities.
………………………………………………………………
21. On 28 November 2006 the cross-claimant paid to the cross-defendant, via its solicitors, the workers compensation payments refundable as a consequence of the judgment in favour of the plaintiff.”

17 Given the whole of the foregoing historical background, the following propositions are, in my opinion, correct:

[1] The contribution proceedings are, so far as concerns their hearing at first instance, at an end. They were brought to that end by the reserved judgment of 29 January 2007.

[2] The indemnity proceedings are, so far as concerns their hearing at first instance, not yet at an end. They will be brought to an end by the reserved judgment now to be published.

[3] The case for the present plaintiff, and the case for the present defendants, were formally closed on 21 November 2006 (T 106). That formal closure embraced both the contribution proceedings and the separate indemnity proceedings.

[4] No matter or issue of fact was then formally reserved by either party.

[5] No matter or issue of fact was formally reserved by either party after the submissions concluded on 22 November 2006.

[6] That being so, it seems to me necessarily to follow that the present correct quantification of the amount of interest to which the plaintiff is entitled in the events that have happened does require, as a matter of strict technicality, that the plaintiff be given leave to prove the precise details of the making of the relevant payments.

[7] The over-arching consideration which governs the granting of any such leave is explained as follows by Clarke JA, (Mahoney JA and Meagher JA agreeing), in Urban Transport Authority of NSW v Nweiser (1992) 28 NSWLR 471 at 476C, D:

“The primary purpose for the rules pursuant to which cases are contested in this State is the furtherance of the interests of justice. For this reason the exercise of the discretion to allow an application to re-open depends essentially upon the trial judge’s view as to whether the interests of justice are better served by granting than refusing the application. Of course, there needs to be finality in litigation and a limit upon the number of issues which it is open to the parties to contest at a hearing. …………………… .”

[8] I can see no reason, referable to the indemnity proceedings themselves, why such leave should not be granted. The basic entitlement is not in dispute. The quantum of each of the relevant payments is not in dispute. The timing of each of the relevant payments is not in dispute. There is no room for any realistic contention that the present defendants were in any way taken by surprise by any of the calculations pertaining to the interest claimed by the present plaintiff in the indemnity proceedings. To allow the indemnity claim to be defeated upon the basis of an omission to lead, before the formal close of evidence, detailed evidence about the amounts and times of the relevant payments, would seem to me to go against the grain of the principles enunciated in Nweizer .

18 But for one outstanding matter, the foregoing propositions would be sufficient to determine in the present plaintiff’s favour the issue of leave to re-open; and necessarily, therefore, the resolution of the interest aspect of the indemnity claim.

19 That outstanding matter has to do, not with the indemnity proceedings as such, but with the contribution proceedings. In that connection it is, I apprehend, desirable to put the point in the actual words of counsel’s written submissions:

“8. The employer’s case on damages was that the plaintiff’s entitlement to damages was limited because, amongst other things, he had a high residual earning capacity so that the assessment for past and future economic loss should be lower than that which the cross-claimant contended. ……………
9. The employer proceedings are a subrogated claim brought by the workers compensation insurer. It had paid the plaintiff workers compensation payments since the day after the accident either on a total or partial incapacity basis and for medical and other expenses.
10. The claims manager is entitled to give evidence to explain the conduct of the insurer in making the payments: ………………….. . A corollary to this is that the claims manager can make concessions on that very issue.
11. To permit the employer to split its case, and re-open to adduce this evidence, precludes consideration of this evidence in the cross-claim proceedings and the possibility of such evidence having a rational bearing on the resolution of the damages issues.”

20 It seems to me that this approach confuses two importantly distinct considerations. It is undoubtedly the case that the two sets of principal proceedings were heard together; and that the evidence in either was available as evidence in both. It does not follow, however, that the two sets of proceedings were simply consolidated: see UCPR Part 28 Rule 28.5, and the alternatives there set out.

21 The plaintiff seeks, as I understand its position, leave to meet, by the re-opening of its case in the as yet unconcluded and separate indemnity proceedings, a technical evidentiary point taken for the first time after the conclusion of the in-Court hearing in November last; and in connection with those unconcluded indemnity proceedings. The plaintiff has not sought leave to re-open its case as cross-defendant in the now concluded contribution proceedings. The plaintiff has no need to do so, having been completely successful in those proceedings.

22 It is submitted that there is to be an appeal by the unsuccessful cross-claimants in the contribution proceedings; and that it has been “foreshadowed” that there either will be, or is likely to be, a cross-appeal. As I am at present advised, a holding appeal has been lodged by the unsuccessful cross-claimants in the contribution proceedings; and not even a holding cross-appeal has been lodged. It is impossible to determine the particular issues which are now to be determined by draping over them a veil of imaginative forensic speculation about contingent appellate proceedings that have barely seen, as yet, the light of day.

23 In my opinion substantive justice can be done by the making of the following orders:

24 In Proceedings 20156 of 2005:

(1) Grant leave to the plaintiff to adduce the evidence that was placed contingently before the Court at the hearing on 16 March 2007.

(2) Verdict for the plaintiff for $59,242.42 plus costs as agreed or taxed.

(3) Judgment accordingly. Judgment may be entered forthwith.

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