Karkoulas v Newmans of Kogarah Pty Ltd

[2000] NSWCA 305

CITATION:	Karkoulas v Newmans of Kogarah Pty Ltd [2000] NSWCA 305
FILE NUMBER(S):	CA 40866/99
HEARING DATE(S):	24 October 2000
JUDGMENT DATE:	1 November 2000
PARTIES :	Simon Karkoulas (Appellant) Newmans of Kogarah Pty Ltd (Respondent)
JUDGMENT OF:	Powell JA at 1; Stein JA at 2; Heydon JA at 23

LOWER COURT JURISDICTION :	District Court
LOWER COURT FILE NUMBER(S) :	DC 1469/99
LOWER COURT JUDICIAL OFFICER :	Christie DCJ

COUNSEL:	C A Evatt/M K Rollinson (Appellant) A S Morrison SC/A J Hourigan (Respondent)
SOLICITORS:	Teakle Ormsby George (Appellant) William K Chambers (Respondent)
CATCHWORDS:	DISTRICT COURT PRACTICE - requisition of jury - referral of matter to arbitration - power of court to refuse reference to arbitration - discretion of court to refuse reference to arbitration when jury has been requisitioned - ND
LEGISLATION CITED:	Arbitration (Civil Actions) Act 1983 District Court Act 1973
DECISION:	Appeal allowed with costs; The Judgment and Orders of Christie DCJ of 27 October 1999 be set aside; The case be remitted to the District Court to determine the application to refer the matter to arbitration according to law.

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL
CA 40866/99
DC 1469/99
POWELL JA
STEIN JA
HEYDON JA

Wednesday, 1 November 2000

Simon KARKOULAS v NEWMANS OF KOGARAH PTY LTD

Held (Stein JA, Powell and Heydon JJA agreeing)

The District Court has power to refer a jury matter to arbitration, subject to the constraints in s 63A District Court Act 1973. Nothing in s 63A(3)(e) precludes the possibility of a referral to arbitration of an action where a party has requisitioned a jury.

Orders:

1. Appeal allowed with costs.

2. The Judgment and Orders of Christie DCJ of 27 October 1999 be set aside.

3. The case be remitted to the District Court to determine the application to refer the matter to arbitration according to law.

OoO


IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL
CA 40866/99
DC 1469/99
POWELL JA
STEIN JA
HEYDON JA

Wednesday, 1 November 2000

Simon KARKOULAS v NEWMANS OF KOGARAH PTY LTD
JUDGMENT

1    POWELL JA: I agree with Stein JA. 2    STEIN JA: This is an appeal from a decision of Christie DCJ of 27 October 1999 refusing to refer a matter to arbitration under the Arbitration (Civil Actions) Act 1983 (the Arbitration Act). Leave to appeal was granted by the Court on 5 June 2000. 3    In giving brief reasons for judgment Judge Christie said:

I take the view … that to order an arbitration hearing and to abandon the jury hearing already fixed would be effectively to deny the defendant the benefit … of a jury requisitioned by the defendant.

and,

[Mr Evatt] wishes me not to rule that a matter cannot be sent to arbitration while ever there is an enforceable request for a jury in existence. That is my view of the situation, because to do otherwise and to grant an arbitration hearing would be effectively to deny the defendant the use of the jury properly requisitioned.

4    His Honour added that in the circumstances he did not see that it was ‘open’ to him to fix the matter for arbitration.

5 It appears to be accepted by Dr Morrison SC, appearing on behalf of the respondent, that his Honour was, in effect, saying that he had no power to refer the matter to arbitration. 6 The plaintiff, Mr Simon Karkoulas, was injured on 29 October 1997 in an accident at his place of employment with the respondent. He issued an ordinary statement of claim in the District Court on 2 March 1999 claiming damages arising out of the negligence of the respondent and breach of statutory duty. A defence was filed on 1 April 1999 denying liability and alleging contributory negligence. On 10 May 1999 the defendant (respondent) requisitioned a jury, as it was entitled to do under s 78 of the District Court Act 1973. 7 A status conference was held before a Registrar on 13 October 1999. At the conference the plaintiff requested that the matter be referred to an arbitrator under the Arbitration Act. Section 63A of the District Court Act governs such references. The respondent objected to the reference on the basis that the matter was not suitable for arbitration because a jury had been requisitioned. The Registrar refused the application to refer and fixed the trial date before a judge and jury for 14 February 2000. 8    The plaintiff then filed a notice of motion seeking orders for an arbitration and the consequent vacation of the hearing date. The motion was supported by an affidavit of Mr Peter George sworn 21 October 1999. He deposed to the suitability of the matter for arbitration and the convenience of arbitration as compared with a jury trial. He said that had the Registrar acceded to the application to refer, a date for the arbitration could have been allocated in December 1999.

9 Under s 18 of the Arbitration Act a person aggrieved by an award may apply for a rehearing. The Court must order a rehearing of the action subject to the provisions of s 18A. The respondent accepts that if the matter was referred to arbitration and it was aggrieved by the award, it would be entitled to a full rehearing of the action with a jury.

10 The first question to address is whether the District Court had power, in the circumstances before it, to refer the matter to arbitration. Under s 63A(1) of the District Court Act the Court is empowered, on application or of its own motion, to refer a matter to arbitration. Before making such an order the Court must consider the matters arising under ss (2). 11    These are:

(a) consider the preparations for trial of the action;
(b) as far as possible, deal with all matters that may be dealt with by the Court on application to the Court before trial of the action; and
(c) give such directions for the conduct of the proceedings before the arbitrator as appear best adapted for the just, quick and cheap disposal of the proceedings.

12    Further, the Court shall not make an order referring a matter to arbitration in any of the circumstances arising under ss (3). These are:

(a) no issue in the action is contested or judgment in the action has been given or entered up and has not been set aside;
(b) the action involves complex questions of law or fact;
(c) the hearing of the action is expected to be lengthy;
(d) the action is an action within a class of actions prescribed by the rules as a class of actions that may not be so referred; or
(e) cause is otherwise shown why the action should not be so referred.

13 The circumstances set forth in subparagraphs (a) to (d) above are not suggested to be relevant to the case in issue. The claim was a relatively straightforward industrial accident. It was not suggested that it involved any complex questions of law or fact or that the arbitration hearing would be lengthy. 14 The respondent however relies on subparagraph (e) that ‘cause is otherwise shown why the action should not be so referred’. 15 The written submissions of the respondent submit that the fact that the respondent had exercised its entitlement to a jury trial would of itself amount to a ‘cause’ within subparagraph (e). It followed, so the submission went, that there was no room for a referral to arbitration. The submission maintains that his Honour did not have a discretion to order a reference to arbitration where a jury was properly requisitioned (submissions para 3.2(a)). The submissions were prepared by senior counsel who did not appear at the hearing of the appeal. Dr Morrison, while not abandoning the submission, did not speak to it. Rather, he sought and was granted leave to rely on a Notice of Contention that even if his Honour was in error in holding that it was not open to him to refer the matter to arbitration, a proper exercise of discretion would have brought about the same result. That is, that he would have refused to refer the matter to arbitration. 16 I have no doubt that the District Court has the power to refer a jury matter to arbitration, subject to the constraints to be found in s 63A. Nothing in s 63A(3)(e) precludes the possibility of a referral to arbitration of an action where a party has requisitioned a jury. There is no argument available to the respondent that a reference to arbitration will deprive a party of its entitlement to a trial by jury, nor does the respondent seek to suggest that this is so. 17 A party aggrieved by an arbitrator’s award is entitled, almost as of right, to a full rehearing, and where a jury has been requisitioned, this would include a jury trial. Of course, it may be that a party will accept the award of an arbitrator and not seek a rehearing. 18 There is, in my view, no substance to the submission that the District Court lacks power to refer an industrial accident case to arbitration merely because a party has requisitioned a jury. 19 I turn, therefore, to the alternative argument of Dr Morrison that assuming the power to refer, the District Court in its discretion would have declined to do so. The principal basis for the submission is that the date for the jury hearing had already been fixed and was not far off - less than 4 months. Accordingly, an arbitration would not save much time. Dr Morrison does not suggest that an arbitration could not have been fixed in December 1999 but stresses that in both cases (arbitration and jury trial), the matter might be ‘not reached’ on the day. Counsel also submits that of its nature, an industrial accident case is less suitable for arbitration than, for example, a personal injury motor vehicle accident. 20 In my opinion, it would be impermissible for this Court to conclude that if the discretion which exists under s 63A had been exercised, it would have been exercised so as to refuse the application to refer to arbitration. Because of the view that his Honour had as to the lack of power to refer a case where a jury had been requisitioned, his Honour did not advert to the relevant factors to be considered or any of the matters contained in s 62A(2) and (3). 21 I would not be prepared to ‘second-guess’ a proper exercise of the discretion. In the circumstances, it is appropriate to remit the matter to the District Court to properly consider the application to refer the matter to arbitration. This position is accepted by counsel for the appellant. 22 Accordingly, I propose that the following orders be made:

1. Appeal allowed with costs.

2. The Judgment and Orders of Christie DCJ of 27 October 1999 be set aside.

3. The case be remitted to the District Court to determine the application to refer the matter to arbitration according to law.

23    HEYDON JA: I agree with Stein JA.

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