Khoury v Linfox Australia Pty Ltd

[2006] NSWCA 51

New South Wales

Court of Appeal

CITATION:	KHOURY v. LINFOX AUSTRALIA PTY. LTD. [2006] NSWCA 51 This decision has been amended. Please see the end of the judgment for a list of the amendments.
HEARING DATE(S):	20/02/2006
JUDGMENT DATE:	20 February 2006
JUDGMENT OF:	Beazley JA at 1,37; Tobias JA at 24
EX TEMPORE JUDGMENT DATE:	02/20/2006
DECISION:	1. Leave granted to appeal.; 2. Appeal allowed.; 3. Extend time for the filing of a Statement of Claim until 21/04/2006; 4. Opponent to pay the claimant's costs of the Summons for leave to appeal and of the appeal and to have a certificate under the Suitors Fund Act is so entitled
CATCHWORDS:	LIMITATION OF ACTION – test for extension of time under the Motor Accidents Compensation Act (NSW) 1999 is whether a “full and satisfactory” explanation for the delay has been provided by the claimant – full and satisfactory explanation provided – deficient initial legal advice by claimant’s previous solicitors - reasonable steps taken by current solicitors in pursuit of a claim - claim hindered by absence of cooperation and inadequate information on the part of the other parties – reasonable person would have failed to comply with statutory requirements - MOTOR ACCIDENTS – extension of time to commence proceedings – whether “full and satisfactory” explanation for delay - APPEAL – incorrect test applied by trial judge – not open to trial judge to find otherwise than that a full and satisfactory explanation had been given
LEGISLATION CITED:	Motor Accidents Compensation Act (NSW) 1999; ss 66(2), 109(1), 109(3)(a), 60C(2)
CASES CITED:	Figliuzzi v Yonan [2005] NSWCA 290 Russo v Aiello (2003) 215 CLR 643 Buller v Black (2003) 56 NSWLR 425 House v The King (1936) 55 CLR 499
PARTIES:	Michael Khoury (Claimant) Linfox Australia Pty. Limited (Opponent)
FILE NUMBER(S):	CA 40717/05
COUNSEL:	K. Andrews (Claimant) P. O'Connor (Opponent)
SOLICITORS:	Keddies (Claimant) McCulloch & Buggy (Opponent)
LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	DC317/05
LOWER COURT JUDICIAL OFFICER:	Judge Duck

CA40717/05

BEAZLEY JA
TOBIAS JA

20 February 2006

KHOURY v. LINFOX AUSTRALIA PTY. LTD.

Judgment

1 BEAZLEY JA: The Court has before it a summons for leave to appeal from an interlocutory decision of Judge Duck of the District Court of 9 August 2005 in which his Honour dismissed an application by the claimant who was seeking leave pursuant to s 109 of the Motor Accidents Compensation Act (NSW) 1999 (the MAC Act) to extend time within which to bring proceedings against the opponent. The summons for leave to appeal and, if granted, the appeal have been heard together.

2 It was properly conceded by counsel on behalf of the opponents that his Honour applied the wrong test when determining whether or not to extend time.

3 His Honour approached the matter on the basis that the test to be applied was whether it was just and reasonable to extend the time to commence proceedings. That terminology appears in some Limitation Statutes in this State but has no application to the extension of time in which to commence proceedings in respect of a motor accident under the MAC Act. An application to extend time in respect of a motor accident is governed by s 109 of that Act.

4 Section 109 provides, pursuant to subsection (3), that the leave of the court to extend time must not be granted unless, relevantly, (a) the claimant provides a full and satisfactory explanation to the court for the delay. His Honour failed to consider that test.

5 I should add that his Honour did determine that part of subsection (3) which requires, pursuant to paragraph (b), that the Court must not grant an extension unless the total damages of all kinds likely to be awarded to the claimant are not less than 25 per cent of the maximum amount that may be awarded. His Honour made a finding in favour of the claimant under that paragraph and that is not challenged.

6 Having made a clear error, it is available to this Court to itself determine whether or not the time in which to bring proceedings ought to be extended pursuant to the test to which I have referred under s 109(3)(a).

7 The trial judge in determining the application before him had an affidavit of the claimant sworn 22 April 2005 and three affidavits of his solicitor Eleni Sarian dated 21 June 2005, 30 June 2005 and 19 July 2005 respectively. It is the latter affidavit which is the most relevant to consider in determining the application.

8 The affidavits, both of the claimant and of his solicitor, provide an extensive chronology of the progress of the claimant’s injury and disability and of the steps that he took in relation to the rights that he might have pursuant to the injury which he sustained on 7 February 2001.

9 In my opinion the affidavit evidence provides a full explanation to the Court for the delay that did occur. As I understand the position taken on behalf of the opponent, that part of the requirement of section 109(3)(a) was not challenged. Rather, the opponent's position was that even though the explanation was full, it was not a satisfactory explanation for the delay.

10 The meaning of a full and satisfactory explanation is itself defined in s 66 of the Act. That provision provides, relevantly:

“66(1) …
(2) In this Chapter, a reference to a full and satisfactory explanation by a claimant for non-compliance with a duty or for delay is a reference to a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant would have failed to have complied with the duty or would have been justified in experiencing the same delay.”

11 It is apparent from the affidavit evidence of the claimant that after the injury he anticipated, one might more accurately say, “hoped”, that his injury would get better. He had ongoing treatment from his general practitioner and from a physiotherapist.

12 He was also referred at an early stage to Dr Rosenberg, an orthopaedic surgeon, who reported on 16 May 2001 that the claimant needed constant reassurance in relation to his symptoms, that he was not a candidate for surgical intervention and that he, Dr Rosenberg, had no plans to see the claimant again.

13 It is apparent from the many references in the affidavit to the further consultations with his general practitioner that the pain continued and, if anything, was getting worse. However, during the first two years or so after the accident the claimant was receiving workers compensation payments. The claimant swore in his affidavit that towards the end of 2002 he relied entirely upon the advice of his doctor in relation to his medical condition and was hopeful that his symptoms would eventually resolve.

14 In February 2003 the claimant received a letter from his employer regarding the Workers Compensation Commission proceedings which caused him to obtain legal advice. He sought legal advice from Salmon & Co Solicitors. Those solicitors advised the claimant that he could bring workers compensation proceedings. They did not advise him that he might have an action either under the MAC Act or in negligence.

15 Throughout 2003 the claimant continued to see medical practitioners and his then solicitors, Salmon & Co, took various steps on his behalf related to the Workers Compensation proceedings. During that period there were apparently settlement offers being made by the Workers Compensation insurers.

16 By the end of 2003 the claimant had decided to obtain a second opinion in relation to his claim at which time he went to his present solicitors, Litigation Lawyers. Those solicitors took prompt steps to commence an investigation of his claim. The steps taken included obtaining advice of counsel who, on or about 27 January 2004, advised that the matter was one that fell within the ambit of the MAC Act.

17 That being so there were numerous steps that needed to be taken by the solicitors on behalf of the claimant if it was intended that the claimant pursue such an action. This is relevant because the limitation period expired on 6 February 2004, shortly after receiving counsel’s advice.

18 It is apparent that the claimant decided to pursue his rights under the MAC Act. Ms Sarian in her affidavit sets out in detail the various steps that she took to ascertain the insurer of the vehicle and the other details necessary for the claim to be made. In the ensuing 12 month period, however, the claimant through his solicitors was “pushed from pillar to post” by the respondent, by insurers and by the Nominal Defendant. As the claimant could not obtain the registration number of the vehicle from the opponent, an application was made to the Nominal Defendant. The Nominal Defendant refused the claim (it would appear, correctly so, as the accident did not occur on a public street). The opponent's CTP insurer, although indicating that the trailer, which was the cause of the accident as alleged by the claimant, was not insured, continued to take part in the compulsory steps that are specified under the MAC Act. In all in the period from the end of January until 1 February 2005 the solicitors took over 100 steps in an attempt to satisfy the requirements of the MAC Act on behalf of the claimant.

19 In my opinion the detail of those steps indicates that action was taken promptly and in pursuit of all the correct procedures that are required under this somewhat complicated legislation. Those steps were met with an absence of co-operation from Linfox and its insurers and more often met with inadequate information from the parties concerned on behalf of the opponent. However, the claimant’s solicitors were hampered in their task both by inadequate and incomplete information being supplied by the opponent and/or its insurer. On occasions there was a complete absence of co-operation from those parties.

20 In my opinion, in all of the circumstances as fully set out in the affidavit evidence, a reasonable person in the position of the claimant would have either failed to have complied with the duty specified in s 66(2) of the MAC Act or would have been justified in experiencing the same delay.

21 I should perhaps make reference to one matter and that is the submission made on behalf of the opponent that the original solicitors for the claimant, Salmon & Co, should have given evidence as to the advice they gave or why they did not give advice in relation to the commencement of proceedings under the MAC Act.

22 That submission does not impact upon my finding that a full and satisfactory explanation has been made in this case. The advice that was given by those solicitors was set out in the affidavit of the claimant and he was not cross-examined. It is apparent from that evidence that those solicitors failed to give advice as to the availability of such an action. The Court otherwise has a complete chronology of the steps that were taken and a complete explanation of why the steps were taken and why they occurred from time to time.

23 Accordingly, in my view the Court should grant leave to appeal, it should allow the appeal and it should extend the time for the filing of a statement of claim in this matter until Friday 21 April 2006. The opponent should pay the claimant's costs of the summons for leave to appeal and of the appeal and have a certificate under the Suitor's Fund if so entitled.

24 TOBIAS JA: I agree with the orders proposed by the presiding Judge and with her Honour's reasons but wish to add the following further observations.

25 It is correct as her Honour has indicated that the primary judge applied the wrong test when determining whether leave should be granted for commencement of proceedings out of time pursuant to s109(1) of the Motor Accidents Compensation Act 1999 (the MAC Act).

26 As appears from [1] of his judgment, his Honour was inadvertently misled by the fact that the claimant was seeking leave pursuant to s109 of the MAC Act to extend time and, in the alternative, pursuant to s60C of the Limitation Act. Section 60C(2) of the Limitation Act provides for the just and reasonable test.

27 However, because his Honour had found that what had occurred was an “injury” within the meaning of the MAC Act it was unnecessary for him to address the alternative basis upon which an extension of time was sought. Nevertheless he wrongly transposed the test required by the Limitation Act to his determination to grant leave under s109(1) of the MAC Act.

28 However, it is clear his Honour was aware of the provisions of s109(3)(a) of the MAC Act, that it was necessary for the claimant to provide a full and satisfactory explanation to the Court for the relevant delay and was also well aware of the terms of s66(2) of the MAC Act; see [42] and [43] of his Honour's judgment.

29 However, when he came to deal with the extent of that delay and its nature in my opinion he made a number of errors which require correction. I say this because, with respect, the primary judge’s consideration of Ms Sarian’s affidavit in the manner set out in [48], [49] and [56] of his judgment amounts, in my view, to a belittling of the efforts that were made by Ms Sarian and, in particular, her predecessor who had the conduct of this matter in the firm of Keddies, namely Mr Gabriel, who by the time Ms Sarian took over the matter had left the firm.

30 Thus, in [48] his Honour refers to Keddies being aware that the time for commencing proceedings expired on 7 February 2004 yet "another year was allowed to pass". Although in [49] his Honour found that the correspondence up to 27 October 2004 did "not amount to a satisfactory explanation" for the delay during the period 27 January 2004 and 16 February 2005, he gratuitously remarked that instead of taking the advice of counsel and acting on it, the solicitors "wallowed for another year writing letters to little effect".

31 His Honour picked up this criticism in [56] where he said that Keddies, knowing of the time limitation, "spent another year writing to people and achieving very little". His Honour's suggestion that all the solicitors needed to do was to obtain the advice of counsel "and act on it" indicates a lack of appreciation of the complexity of the steps required to be taken by the solicitors which it appears to me, they well knew, before proceedings could be commenced under the provisions of the MAC Act.

32 Accordingly, in my opinion his Honour has reflected adversely upon the efforts made by Keddies in relation to the matter and has belittled those efforts in a manner which, in my opinion, was unjustified and requires correction.

33 The relevant principles applicable to provisions such as s109(3)(a) were recently expounded in the decision of this Court in Figliuzzi v Yonan [2005] NSWCA 290. In [64] of that judgment reference was made to what Gleeson CJ said in Russo v Aiello [2003] 215 CLR 643 at 646 [7] to the effect that what is involved in the concept of a satisfactory explanation is that the relevant conduct of the person in question should be justified by reference to the way in which a reasonable person in the position of that person could have been expected to behave.

34 Furthermore, the Court in that case adopted what Giles JA had said in Buller v Black (2003) 56 NSWLR 425 at 442 [96] as to the circumstances in which an appellate court can interfere with a decision of the trial judge on the question of whether the relevant delay had been fully and satisfactorily explained. In particular, his Honour observed that what was involved was not the exercise of a discretion of the House v The King type but a normative judgment in respect of which minds may reasonably differ so that the trial judge's decision could not be interfered with unless it was one that was not open to him.

35 Even if the primary judge in the present case had not applied the wrong test, I would take the view that the determination to which he came, if it can be assumed to be a finding that a full and satisfactory explanation had not been given, was one which in the circumstances and upon the evidence was not fairly open to him.

36 For these additional reasons I agree with the orders proposed by the presiding Judge.

37 BEAZLEY JA: The orders of the Court will be as proposed.

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15/03/2006 - no amendments made - Paragraph(s) N/A