Lee v Omni Leisure Operations Pty Ltd

[2008] VSC 272

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

No.  6908 of 2007

ADRIAN FRANCIS LEE	Plaintiff
v
OMNI LEISURE OPERATIONS PTY LTD (ACN 079 630 603)	Defendant

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JUDGE:	BYRNE J
WHERE HELD:	Melbourne
DATE OF HEARING:	15 July 2008
DATE OF JUDGMENT:	16 July 2008
CASE MAY BE CITED AS:	Lee v Omni Leisure Operations Pty Ltd
MEDIUM NEUTRAL CITATION:	[2008] VSC 272

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LIMITATION OF ACTIONS – personal injury claim arising out of incident in Queensland  – proceeding not commenced within limitation period– application for extension of time for commencement of proceeding – statute confers general power to extend time – power to be exercised judicially – circumstances relevant to exercise of power – inordinate delay due to conduct of lawyers– no prejudice to defendant – extension allowed.

Personal Injuries Proceeding Act 2002 (Qld) s. 59

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr J Philbrick SC with Mr B Charrington	Winn Legal
For the Defendant	Mr D Aghion	Moray & Agnew

HIS HONOUR:

1. On 19 November 2001, the plaintiff, Adrian Francis Lee, and his family, were on holiday in Queensland.  There they visited the Dreamworld Theme Park conducted by the defendant, Omni Leisure Operations Pty Ltd (“Omni”).  Having decided to take a ride on the Mine Ride, Mr Lee was standing in a stationary rail car when it was struck by another rail car.  As a consequence, he says, he has suffered serious injury to his spine.

1. Following his return to Victoria, Mr Lee, on 24 June 2002, retained as his lawyers, Beck Sheahan Quinn & Kirkham.  His matter was handled by a solicitor employed by that firm, Louise Sarah Henby D'Wynn.  Ms Henby D'Wynn, apart from a five-month period from 22 November 2004, continued to manage the file as an employee of that firm[1] until 30 June 2005 and thereafter as a solicitor acting as a principal under the firm name of Winn Legal.

   [1]On 4 June 2004 the firm changed its name to Beck Legal.

1. Regrettably Mr Lee was not well served by Ms Henby D'Wynn and by most of the other lawyers that acted for him.  Counsel on his behalf described their conduct of the matter as:  "marked or punctuated right through by ineptitude and by bungling and by delay after delay."  A notable exception to this sorry list was Mr Charrington of the Queensland bar who continues to act for Mr Lee.[2]

   [2]Mr Philbrick, who appeared as senior counsel for Mr Lee, had not previously acted for him in this matter.

1. It was common ground before me that Mr Lee's claim was governed by the substantive law of Queensland.  This law included the Limitation of Actions Act1974 s. 11, pursuant to which his cause of action expired after three years,[3] that is, in November 2004. By s. 31 of that Act, there is a limited power to extend this limitation period. In fact, Mr Lee did not commence a proceeding until 27 June 2007, nearly six years after the cause of action arose and well after the expiry of the three-year limitation period. His application to extend the limitation period pursuant to s. 31 of the Limitation of Actions Act was not pursued.

   [3]This provision is made part of the substantive law of Queensland by s. 43A(2).

1. Claims for damages for personal injury in Queensland are subject to the provisions of the Personal Injuries Proceeding Act 2002 which is referred to as PIPA.  The provisions of this statute are also provisions of the substantive law of Queensland.[4]

   [4]PIPA s. 7(1).

1. Section 59 of PIPA also permits a court to make orders enabling a plaintiff to commence a proceeding out of time where the proceeding is based on a claim in respect of which notice of claim has been given.  The relevant provisions are sub‑ss.(1) and (2) of s. 59 which are in the following terms:

59       Alteration of period of limitation

(1)If a complying part 1 notice of claim is given before the end of the period of limitation applying to the claim, the claimant may start a proceeding in a court based on the claim even though the period of limitation has ended.

(2)However, the proceeding may be started after the end of the period of limitation only if it is started within—

(a)6 months after the complying part 1 notice is given orleave to start the proceeding is granted; or

(b)a longer period allowed by the court.

1. The application before the court is one by Mr Lee to extend the time within which his proceeding may be commenced pursuant to sub-s. (2)(b) of that section.

1. It will be recalled that Mr Lee's personal injury arose out of an incident on 19 November 2001.  PIPA came into force on 18 June 2002.  By an amendment made in August of that year, its provisions were made to apply retrospectively to claims arising out of incidents occurring before 18 June 2002.  This retrospective operation was implemented by a series of legal fictions, including the deeming provisions of s. 77A. Under the statute, Mr Lee’s injury is deemed to have occurred on 1 August 2002.

1. The scheme of Chapter 2 of PIPA is to oblige parties to provide to each other full information as to their claim and their defence to that claim before commencing a proceeding in court.  Division 4 provides for a pre-proceeding compulsory conference at which offers are to be made in an attempt to settle the claim.  Chapter 2 also contains sanctions for non-compliance.[5]  Finally, a claimant is encouraged[6] by s. 42 to commence a court proceeding to enforce its claim promptly after the compulsory conference.  This will normally be within 60 days after the conclusion of that conference.[7]

   [5]See, for example, ss. 18(1), 32, 35, 48 and 59(3).

   [6]See s. 42(4) and (5) for the sanctions for non-compliance.

   [7]Section 42(1)(a).

1. Section 59 appears to have been inserted into PIPA to provide limited protection to a claimant who has commenced a claim by giving notice of the claim, but who does not commence the proceeding in court to enforce the claim within the applicable period of limitation. It is modelled on s. 57 of the Motor Accident Insurance Act 1994 (Qld) as amended in 2000. This amending bill established for motor car claims a pre-proceeding procedure similar to those in Chapter 2 of PIPA. Prior to this amendment, s. 57 permitted a claimant to commence a proceeding where a notice of claim had been given in compliance with Division 1, but only within six months after the notice of claim had been given. The amendment conferred on the court the power to enlarge this time further and this is in terms similar to the power which was later included in s. 59 of PIPA and which the Court is now asked to exercise.

1. Section 57 of the Motor Accident Insurance Act and s. 59 of PIPA have been the subject of judicial consideration in Queensland.  So far as is here relevant, the cases show the following:

(1)Section 59(2)(b) was introduced to deal with a case where the claimant failed to commence the proceeding within the limitation period because of the requirements that the claim pass through the various processes prescribed by Parts 1 and 2 of PIPA, Chapter 2.[8]

(2)Nevertheless, the power conferred by s. 59(2)(b) is not limited to such a case.  It confers upon the court a general power to extend time without any statutory direction as to the circumstances of its exercise.  The discretion, however, must be exercised judicially, having regard to the objects of the Limitations of Actions Act and those of PIPA.[9]

(3)Factors in a case such as the present which the court must have regard to include the length of the delay, its explanation, whether the proposed respondent has been unfairly prejudiced[10] and whether the exercise of the power would be consistent with the overriding obligation of the court to do justice between the parties.[11]  A further consideration, but one of lesser moment, is the general interest of the court in having its proceedings prosecuted expeditiously.

(4)The objects of the relevant statutory regimes are also important.  The Limitation of Actions Act imposes a three-year limitation, a fact which must be the starting point for any consideration.  The policy reasons for this are well known.[12]  To this should be added the undesirability that a defendant should be required to endure longer than is necessary the risk or expectancy that a claim may be brought in court against it.

[8]Morrison-Gardiner v Car Choice Pty Ltd [2005] 1 QdR 378 at 402 [82], per Chesterman J, McMurdo P and Williams JA concurring; Winters v Doyle [2006] QdR 285 at 292 [24], per Keane JA.

[9]Morrison-Gardiner v Car Choice Pty Ltd at 386 [11], per McMurdo P at 390 [29], per Williams JA at 401 [77], per Chesterman J;  Ward v Wiltshire Australia Pty Ltd & Anor [2008] QCA 93 at [24], per McMurdo P at [67], per Fraser JA, Mackenzie AJA concurring.

[10]Winters v Doyle  at 293 [25], per Keane JA.

[11]Morrison-Gardiner v Car Choice Pty Ltd  at 402 [82], per Chesterman J.

[12]See Morrison-Gardiner v Car Choice Pty Ltd at 390 [30], per Williams JA.

1. The objects of PIPA are set out in s. 4.  Its main purpose includes the expectation that it will enable claimants to recover awards of damages which are appropriate and sustainable.  The means of achieving the main purpose include the speedy resolution of claims and ensuring that court proceedings are not commenced prematurely.

1. I turn now to consider the factual background against which this application must be assessed.  The delay in commencing the proceeding is inordinate.  It was said with some justice that it was not possible for Mr Lee to convene a compulsory conference until his injuries had stabilised.  This may have warranted deferring the conference until some time as late as 2005.  Nevertheless, the principal reason for the failure to commence this proceeding has been the failure of his legal advisors to be aware of the various options available[13] and to pursue them, or the claim generally, with any enthusiasm.

   [13]See, for example, ss. 42 and 43(1).

1. Immediately after the incident, Mr Lee attended the first aid centre at Dreamworld.  Thereafter he maintained contact with Omni.  It arranged for him to see its own orthopaedic surgeon, Mr Ian R. Jones on 8 April 2002 and the consequent  report shows his opinion that Mr Lee had suffered injury by the incident, which he described as having occurred at Dreamworld.  Omni made what were called “liability payments” to Mr Lee for salary and medical and the like expenses but these payments, I was told, stopped when PIPA came into operation retrospectively in August 2002.

1. Notice of claim was given either on 13 or 20 December 2002.  It appears to have been received by Neil Arthur Hedges, Omni's Insurance and Risk Manager on 27 December.  It was within the time prescribed by PIPA[14] and was accepted by Mr Hedges as a compliant notice.  It has not been suggested on behalf of Omni that it suffered any prejudice by reason of the delay in commencing this proceeding.  Indeed this is not surprising. Although Omni responded on 18 May 2004 to the notice of claim by not admitting liability to compensate Mr Lee and made him on 22 July of that year a nil offer, there was nothing before me to cause me to conclude that the determination of his claim would be, for practical purposes, other than an assessment.  It seems too that the medical reports obtained by him were all provided to Omni.

   [14]Under s 77A(3), Mr Lee is taken to have consulted his solicitors not earlier than 30 November 2002. Section 9(3) of the Act then requires that the notice of claim had to be lodged no later than 1 month after that date, namely 30 December 2002.

1. Although counsel for Mr Lee made little of this, it does appear that Omni failed to comply with its obligations to provide Mr Lee with the information specified in s. 20 of PIPA.  In any event, little progress was achieved in the two years after the notice of claim was delivered up to the expiry of the limitation period.  This was the period in which Mr Lee's injuries were being treated and stabilisation of them was awaited.  There appears to have been some suggestion of a compulsory conference in early 2004, but the matter was not pursued.

1. I will not burden this judgment with the dispiriting tale of the delays that followed.  By late 2005 appropriate advice was being received from Mr Charrington, but for some reason it was not acted upon.  Meantime, Omni had engaged its own solicitors in November 2005 and there were suggestions that offers might be made and considered, notwithstanding that the limitation period had expired.  But again nothing came of this.

1. At this time too, Ms Henby D'Wynn was speaking of bringing an application to extend time.  But nothing was done.  By way of example, I mention that the preparation of Mr Lee's affidavit took some three months and, after it was sworn on 6 June 2006, it was not sent to Omni's solicitors until 26 September, another delay of three months; and yet another three months passed until 11 December 2006 when she instructed counsel to prepare the necessary documentation for this proceeding.

1. The sorry tale continues.  The writ was filed after six months, on 27 June 2007, but the application to extend time was not filed until five months later on 22 November 2007.  What was put on behalf of Mr Lee was that he should not be disadvantaged by the neglect of his lawyers.  The evidence showed that he was persistent in making enquiries as to the progress of the claim and insistent that it be expedited.  It also shows that he was not advised that the time for commencing the proceeding under the Limitation of Actions Act was likely to expire or had expired until well after the date of its expiry.  His efforts to goad his solicitors into action were entirely unsuccessful.  Their responses to him appeared to have been directed to giving comforting but misleading information that all was going well.  Their handling of the file appears to have been characterised by the complete absence of any sense of urgency.

1. Counsel for Omni then said that Mr Lee should have terminated the retainer of his solicitors and should have retained a firm who was ready and willing and able to act for him.  In the circumstances of this case, this is, to my mind, not realistic.  Mr Lee is a man of limited education and with no experience of litigation.  He is not a man who would be expected to confront his professional advisors.  He was, since 2004, living in Tasmania.  He cannot be criticised in the way that has been suggested.  This is not a case where he should be visited with the sins of his lawyers.  To my mind the critical factor here is that the plaintiff who has a claim should not be denied the opportunity to pursue his claim because of admitted delays which are not of his making and where the defendant has not suffered any prejudice.  The objectives of PIPA are not advanced by my refusal to extend the time nor are those of the limitations legislation. 

1. On the face of it, the plaintiff has a claim which might properly be pursued and the interests of justice do not demand that he be shut out.  Accordingly, I have determined that the extension of time which he seeks should be granted. 

1. There is some mention in the cases to which I was referred that it would be inappropriate in the circumstances to make an order nunc pro tunc.[15]  This may have depended upon the rather different terms of the legislation in Queensland, particularly the motor car legislation prior to its amendment in 2000.  In any event, counsel for both parties before me expressed the view that it would be appropriate for me, if I were satisfied that the application should succeed, to make an order nunc pro tunc and accordingly I will do so.  It would seem therefore that the appropriate order that would follow from this would be that the time within which the plaintiff may start this proceeding be extended nunc pro tunc to 28 June 2007 so as to validate this proceeding, if indeed it be invalid.

   [15]See Kash v SM & TJ Cedergren Builders [2004] 1 QdR 643 at 648 [18] and Holmes v Adnought Sheet Metal Fabrications [2004] 1 QdR 378 referred to therein.

1. Mention has been made of the effect of s. 59(3) under which the proceeding may be stayed pending compliance with Part 1 of Chapter 2 of PIPA.  The notable non‑compliance here is the failure to hold a compulsory conference in accordance with Division 4.  I have power to dispense with the compulsory conference and I will do so on the basis that it will be replaced by a mediation under Order 50 of our Rules.  The order should then include an order in terms of s. 36(5)(b) and a mediation order.

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