Jackson v Bluescope Steel Limited

[2011] NSWDDT 2

Dust Diseases Tribunal

New South Wales

Medium Neutral Citation:

Jackson v Bluescope Steel Limited & Anor [2011] NSWDDT 2

Hearing dates:

8 March 2011

Decision date:

22 March 2011

Before:

Kearns J

Decision:

Pursuant to Part 1 Rule 1.12 of the UCPR 2005 (NSW), the time within which Bluescope is to file a cross-claim against Allianz is extended to Friday, 25 March 2011.

Bluescope is granted leave to file and serve a statement of cross-claim in the form annexed to its notice of motion filed in Court on 8 March 2011.

Catchwords:

Dust diseases; cross claim on insurance policy; application for extension of time to file cross claim made after plaintiff's case proceeded to judgment; wither power in Tribunal to extend time; whether Tribunal ought to extend time

Legislation Cited:

Dust Diseases Tribunal Act 1989
Civil Procedure Act 2005
Uniform Civil Procedure Rules 2005 (NSW)

Cases Cited:

Seltsam Pty Limited v Energy Australia [1999] NSWCA 89;
Re Home, Overall Forge Pty Ltd v Wallaby Grip Ltd (19 September 1997, unreported);
Sarkem Pty Ltd v CSR Ltd, re Weismantel [2008] NSWDDT 39

Category:

Procedural and other rulings

Parties:

Margaret Jackson as legal representative of Youden Richard Jackson (Deceased)
Bluescope Steel Limited
BHP Billiton Limited

Representation:

Mr T G R Parker SC, instructed by Piper Alderman, appeared for Bluescope Steel Limited.
Mr G F Little SC with Mr D C Morgan, instructed by Ellison Tillyard Callanan, appeared as amicus curiae.

File Number(s):

DDT 6166/2006

Judgment

1. Mr Jackson sued Bluescope and BHP for damages for the contraction of mesothelioma from exposure to asbestos. He died before his case could be concluded though that matter is not relevant for present purposes. I shall refer to his proceedings and the substituted proceedings on his death as the "Jackson proceedings".

1. The Jackson proceedings resulted in a verdict and judgment for the plaintiff against Bluescope for $225,000 plus costs. Costs were later agreed at $80,000. Both the judgment and the costs have been paid by Bluescope.

1. There have been some changes of corporate identities or names over time, but it is convenient to ignore them and continue to refer to Bluescope which was formerly John Lysaght (Australia) Limited and also refer to Allianz Australia Insurance Limited (Allianz) as Bluescope's insurer.

1. Bluescope seeks indemnity from Allianz. To describe Bluescope's forensic efforts to obtain that indemnity as having run off the rails would be mistaken. Bluescope has never put its proceedings on the rails.

1. Bluescope commenced its efforts to obtain indemnity by issuing a statement of claim in the Tribunal on 16 June 2009 (the 2009 proceedings). Neither Bluescope nor Allianz appreciated that in doing this in the way it did Bluescope was seeking to invoke a jurisdiction the Tribunal did not have. Nevertheless, the matter proceeded with several interlocutory steps, the filing of several amended pleadings and the filing of affidavits until the issue of jurisdiction was raised before me in September 2010. Both parties eventually realised that I had no jurisdiction to hear the 2009 proceedings.

1. Bluescope sought to overcome the problem by filing a notice of motion seeking an order extending the time in which it could file a cross-claim. There were two reasons why this process was bound to fail.

(1) The notice of motion was filed in the 2009 proceedings. If, as was the case, I had no jurisdiction to hear the 2009 proceedings, I could have no jurisdiction to hear a notice of motion in them.

(2) The notice of motion filed in the 2009 proceedings sought orders in the Jackson proceedings. This was an irregularity of such a nature that it could not be cured. The parties in the two proceedings are not the same.

1. Bluescope then filed a notice of motion in the Jackson proceedings. The problem with that is that it was filed in Court on the day the matter was to be heard. Mrs Jackson, a party potentially interested, had not been served.

1. Allianz appeared to argue the notice of motion in the 2009 proceedings, but that was not proceeded with. Mr Little SC who, with Mr Morgan, appeared for Allianz, stated he had no locus in the Jackson proceedings and he could appear as amicus curiae only. There was no objection to that and as he was prepared to argue the substantive matter and as Mrs Jackson was unlikely to have a material interest in the outcome, I allowed the argument to proceed. I reserved to allow Mrs Jackson to be served and to have an opportunity to appear and have such say as she wished.

1. The problem that arises all stems from the fact that the Jackson proceedings were concluded without Bluescope having sought or obtained leave to issue a cross-claim.

1. It is not in doubt that the Tribunal has jurisdiction to hear appropriate claims for indemnity by an insured against an insurer. That is as part of its "ancillary or related" jurisdiction ¹.

1. Further, it is also not in doubt that, in the circumstances of this case, the Tribunal does not have jurisdiction to hear a primary claim for indemnity by an insured against an insurer. The 2009 proceedings are such a primary claim being instituted by statement of claim and being separate and independent proceedings in their own right.

1. Further, it is also not in doubt that had Bluescope sought and obtained leave to issue a cross-claim against Allianz before judgment was entered in the Jackson proceedings and had it filed a cross-claim in accordance with that leave, the jurisdiction of the Tribunal would have been properly invoked notwithstanding the judgment in the Jackson proceedings.

1. Further, in light of Seltsam Pty Limited v Energy Australia ², it cannot be in doubt that if, before judgment in the Jackson proceedings, Bluescope had sought and obtained leave to issue a cross-claim within a defined time and had failed to issue a cross-claim within that time, then later, after judgment in the Jackson proceedings, it again sought leave to file a cross-claim, the Tribunal would have been entitled to grant such leave.

1. The notice of motion that I am determining fits none of those categories. This is a case where judgment has been entered in the Jackson proceedings without any request by Bluescope for leave to issue a cross-claim. Bluescope now seeks leave to issue a cross-claim in the Jackson proceedings. It seeks an extension of time within which to do that. Bluescope says this is permitted by Seltsam . Allianz says it is not, because before judgment for the plaintiff in Seltsam there had been a request for and a grant of leave to issue a cross-claim and Seltsam is, therefore, distinguishable. It also argues that if the Tribunal is empowered to extend the time and grant the leave, it should not do so.

1. It becomes necessary to examine precisely what Seltsam decided. In that case, the plaintiff sued the defendant in negligence for the contraction of mesothelioma. An urgent hearing was fixed. On the evening of 17 January 1997, the case was settled. Documents were handed to O'Meally P. There were terms of settlement which provided for payment of a judgment sum to the plaintiff. There was an order for judgment with the judgment to take effect on 17 January 1997. There were short minutes of order which included leave to the defendant to issue and proceed with any cross-claim filed within 28 days. The defendant did not file a cross-claim within 28 days. On 25 July 1997, the defendant filed a notice of motion seeking leave to extend the time to issue a cross-claim for 14 days. O'Meally P made an order extending time and a cross-claim was duly filed. Notices of motion were filed to have the cross-claim struck out.

1. On 16 July 1998, Maguire J dismissed those notices of motion. The Court of Appeal held that the decision to dismiss the strike out motions was correct, but it offered different reasons to those offered by Maguire J. It is necessary to analyse, therefore, why the Court of Appeal considered the decision of Maguire J to be correct. In doing so, I note that Priestley JA agreed with Giles JA. Fitzgerald JA dissented. The ratio, therefore, is to be found in the reasons of Giles JA.

1. Seltsam was decided under the Supreme Court Rules (SCR). This case was argued on the Uniform Civil Procedure Rules (UCPR). It is not suggested that makes any difference.

1. In my view, the ratio in the Seltsam case may be extracted from paragraph 41 where Giles JA said,

"In my opinion, judgment in favour of the plaintiff in proceedings in the Tribunal does not mean that the proceedings are at an end so that a cross-claim can not be included in the proceedings within the meaning of s11(4). The proceedings remain on foot so as to enable the defendant to give effect to its entitlement to file a cross-claim within 28 days from the service of the statement of claim upon it, that being an entitlement in accordance with the Tribunal's rules and procedures. That time may be enlarged by an order made pursuant to Pt2 r3 of the Supreme Court Rules as applied pursuant to r2 of the Dust Diseases Tribunal Rules, and if it is enlarged the proceedings remain on foot so as to permit the defendant to exercise its entitlement within the enlarged time. In the language used by Gaudron J in FAI General Insurance Company Ltd v Southern Cross Exploration NL, while it remains for the Tribunal to exercise the further function of receiving and determining a cross-claim filed within the 28 days, and the further function of determining whether an extension of the 28 days should be granted, the Tribunal is not functus officio; addressing s11(4) of the Act, the proceedings remain on foot for the exercise of those functions and a cross-claim filed within the 28 days or the extended time is included in the proceedings."

(The emphasis is mine.)

1. This paragraph does not suggest that the exercise of the Tribunal's jurisdiction is dependent on the Tribunal, before the plaintiff's judgment, having granted leave to issue a cross-claim. The paragraph proceeds on the basis of the time limits provided by the Rules. It then states that those time limits may be enlarged. In that case, time could be enlarged under Part 2 Rule 3 of the SCR. That Rule has an equivalent in Part 1 Rule 1.12 of the UCPR under which this case was argued.

1. I think that reading of the paragraph is supported by [52]. There, Giles JA explained that the decision in re Home ³may or may not have been correct. Leave to issue a cross-claim was refused in that case where it was sought about two years after the plaintiff's proceedings had been resolved. The Tribunal held that it had no jurisdiction to entertain the cross-claim. Giles JA held that the Tribunal did have jurisdiction to entertain the cross-claim if the jurisdiction was appropriately invoked. An extension of time within which to bring the cross-claim was necessary to invoke the jurisdiction. It seems clear from this that an extension of time may be sought (and granted in the appropriate case) after a plaintiff's case has proceeded to judgment.

1. I draw from Seltsam, therefore, that the absence of a request, before judgment in a plaintiff's proceeding, for leave to issue a cross-claim or for an extension of time to do so, does not put an end to those proceedings to the extent that the Tribunal may not entertain an application by a defendant to those proceedings to extend time to file a cross-claim.

1. My attention was drawn to the dissent of Fitzgerald JA and other authorities supporting a contrary view. Whether a contrary view be right or wrong does not matter. I consider I am bound by Seltsam .

1. The question then arises as to whether this is an appropriate case to allow Bluescope an extension of time within which to file a cross-claim.

1. Allianz opposes this for a number of reasons.

(1) It is said that Seltsam was a case of contribution between tortfeasors and this is not. This is not to the point. It is clear that the Tribunal's ancillary and related jurisdiction extends to both and the fact that this is not a claim between tortfeasors is, in my view, not a basis for refusing to extend time.

(2) Bluescope was at liberty to bring its claim in another court and has time to do so. That is, at best, a neutral point. Whichever court or tribunal the claim is brought in, Allianz will have to meet it and presumably is currently in a position to do so. It seems to me there is nothing to be gained by requiring the parties to litigate in another court, especially where extensive preparation has already been undertaken by both sides for the litigation in this Tribunal.

(3) The resolution of the Jackson proceedings and subsequent filing of a statement of claim by Bluescope does not involve procedural irregularity within the meaning of the Civil Procedure Act 2005. Whether or not that is so is not to the point because the grant of an extension of time is not dependent on a procedural irregularity - UCPR Part 1, Rule 1.12.

(4) Bluescope has not provided a full and satisfactory explanation for its delay in making this application. The explanation is self evident and that is that it had not occurred to Bluescope's advisers that there was a problem requiring the grant of leave. This did not occur to either party before September 2010. It is evident it had not occurred to Allianz's advisers as Allianz filed a defence and amended defences on 22 July 2009, 2 October 2009, 14 October 2009, 8 December 2009 and 25 February 2010 without raising the jurisdictional issue. It is plain the issue struck both parties in September 2010. Accordingly, the delay up until then is explained. The delay after then is explained by the activity of the parties in seeking to deal with the problem.

(5) Given the purely contractual nature of the insurance dispute in this case, the Tribunal should decline to exercise jurisdiction following the approach of Curtis J in Sarkem v CSR ⁴. In that case, CSR entered into a deed with its insurer whereby it received a large sum of money and released its insurer from claims for indemnity from any of the companies within the CSR group. Sarkem was within the CSR group. A plaintiff brought a claim against Sarkem claiming damages for the contraction of mesothelioma. He settled. Sarkem brought a claim against CSR alleging that it held the monies it received from its insurer on trust for it and seeking that CSR indemnify it accordingly. That case is different. It clearly involved a commercial dispute between two related companies and questions relating to the law of trusts were to be agitated. There were probably issues relating to implied trusts and constructive trusts. Commercial and equitable issues of that nature do not arise here.

1. There are matters that support the matter being heard in the Tribunal. One is that the parties have conducted this litigation from the filing of the statement of claim in June 2009 to September 2010 as if it were to be conducted in the Tribunal. As indicated earlier, this has involved several interlocutory processes and the filing of pleadings and affidavits. Another matter is one of the issues will concern the reasonableness of the conduct of Bluescope and its legal advisers in the conduct of the Jackson proceedings which were brought on urgently. The practices and procedures of the Tribunal in 2006 are likely to bear on this and, it seems to me, the Tribunal with its experience is likely to be better placed in taking these matters into account, to the extent they need to be, in assessing the evidence and the reasonableness of the conduct of those concerned.

1. For the above reasons, I propose to grant the relief sought by Bluescope.

Orders

1. Pursuant to Part 1 Rule 1.12 of the UCPR 2005 (NSW), the time within which Bluescope is to file a cross-claim against Allianz is extended to Friday, 25 March 2011.

1. Bluescope is granted leave to file and serve a statement of cross-claim in the form annexed to its notice of motion filed in Court on 8 March 2011.

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1 Dust Diseases Tribunal Act 1989, s11(4)

2 [1999] NSWCA 89

3  re Home, Overall Forge Pty Ltd v Wallaby Grip Ltd (19 September 1997, unreported)

4 Sarkem Pty Ltd v CSR Ltd, re Weismantel [2008] NSWDDT 39

Decision last updated: 25 March 2011