Matthews v SPI Electricity and SPI Electricity Pty Ltd v Utility Services Corporation Ltd (Ruling No 12)

[2012] VSC 549

IN THE SUPREME COURT OF VICTORIA Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 4788 of 2009

CAROL ANN MATTHEWS	Plaintiff
v
SPI ELECTRICITY PTY LTD (ACN 064 651 118)	Defendant

SPI ELECTRICITY PTY LTD (ACN 064 651 118)	Plaintiff by counterclaim
v
UTILITY SERVICES CORPORATION LIMITED (ACN 060 674 580) & ORS	Defendants by counterclaim

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JUDGE:	J FORREST J
WHERE HELD:	Melbourne
DATE OF HEARING:	23 October 2012 (written submissions 2 November and 9 November 2012)
DATE OF RULING:	10 November 2012 (Reasons provided 19 November 2012)
CASE MAY BE CITED AS:	Matthews v SPI Electricity and SPI Electricity Pty Ltd v Utility Services Corporation Ltd (Ruling No 12)
MEDIA NEUTRAL CITATION:	[2012] VSC 549	Revised 20 November 2012

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PRACTICE AND PROCEDURE – Part 4A Supreme Court Act 1986 (Vic) – Group proceeding – Application to amend group definition – Interests of justice – Supreme Court Act 1986 (Vic) ss 33E(1), 33E(2) and 33ZF.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Keogh SC Mr L Armstrong Ms M Szydzik	Maurice Blackburn Pty Ltd
For SPI Electricity Pty Ltd	Mr J Beach QC Mr D Farrands	Freehills
For USC	Mr R Ray QC Ms E Brimer	Holman Fenwick Willan
For the State parties	Mr P Zappia Mr M Rush	Norton Rose
For the State of Victoria	Mr P Herzfeld	Victorian Government Solicitor’s Office
For Commonwealth of Australia	Ms E Nance	Australian Government Solicitor

HIS HONOUR:

Introduction

1. On 23 October 2012, I delivered an ex tempore ruling concerning a series of amendments to Mrs Matthews’ current statement of claim.  I deferred the question of amendments to the group definition as proposed by Mrs Matthews so that further submissions could be made by the parties, as well as the Commonwealth and the State of Victoria – both of which are affected by the proposed amendments.

1. The proposed amendments seek to finalise the position of potential group members under s 33E(2) of the Supreme Court Act1986 (Vic). Mrs Matthews says that permitting the amendments will resolve confusion at the mediation and the trial as to the composition of the group – in particular, her lawyers seek to exclude any late entry by the Commonwealth or State or related entities into the group.

1. SPI’s approach is curious, but understandable. In oral submissions, rather than have the class limited as proposed by Mrs Mathews, counsel argued that group membership should be enlarged to include the Commonwealth, the State and any entities that may currently be carved out of the group by s 33E(2). Alternatively, it submitted (as amplified in its subsequent written submissions) that I should order that the Commonwealth, the State and any associated entities provide particulars of loss, notwithstanding that they are not group members.

1. I have concluded that it is appropriate to make an order, in effect, firewalling the group by excluding solely those persons or entities currently excluded by s 33E(2) and not permitting any further inclusion of those persons or entities other than those who have given consent to be group members. It is not appropriate to make an order for the provision of particulars as sought by SPI. My reasons now follow.

The Proposed Amendments

1. Mrs Matthews proposes the following amendment to the group definition contained in paragraph 4 of her statement of claim:

The group members to whom this proceeding relates are:

(aa) all person [sic] identified in the “List of Registered Personal Injury Claimants” filed pursuant to Order 2 made on 14 October 2011;  and

(a) all those persons who suffered personal injury (whether physical injury, or psychiatric injury as defined below) as a result of:

(i) the Kilmore bushfire (including, without limitation, an injury suffered as a result of attempts to escape the Kilmore bushfire or other emergency action taken by any person in response to the Kilmore bushfire); and/or

(ii) the death of or injury to another person as a result of the Kilmore bushfire. [sic] where “psychiatric injury” in this group definition means nervous shock or another psychiatric or psychological injury, disturbance, disorder or condition which has been diagnosed as such in a diagnosis given to the person by a medical practitioner prior to 31 January 2012; and

(b) the estates of or dependants of any person who died in or as a result of the Kilmore bushfire (including, without limitation, a death resulting from attempts to escape the Kilmore bushfire or other emergency action in response to the Kilmore bushfire); and

(c) all those persons who suffered loss of or damage to property as a result of the Kilmore bushfire (including, without limitation, loss or damage resulting from emergency action taken by any person in response to the Kilmore bushfire); and

(d) all those persons who at the time of the Kilmore bushfire resided in, or had real or personal property in, the Kilmore bushfire area and who suffered economic loss, which loss was not consequent upon injury to that person or loss of or damage to their property;

but provided that:

(i) persons in (b), (c) or (d) shall not be treated as making a claim for personal injury in these proceedings unless they are also covered by (aa) or (a) above; and

ii) the group members do not include:

(A) the Commonwealth, a State or a Territory; or

(B) a Minister of the Commonwealth, a State or a Territory; or

(C) a body (whether corporate or unincorporated, or an association) established for a public purpose by a law of the Commonwealth, a State or a Territory, provided however that a body which by 30 October 2012 has registered as a group member with the plaintiff’s solicitors shall be a group member; or

(D) any judge, magistrate or other judicial officer of the Commonwealth, a State or a Territory; or

(E) any other officer of the Commonwealth, a State or a Territory, in his or her

capacity as an officer.

The Relevant Legislation

1. Section 33E of the Supreme Court Act 1986 (Vic) is as follows –

33E    Consent of group member

(1)     Subject to subsection (2), the consent of a person to be a group member is not required.

(2)     None of the following persons is a group member unless the person gives consent in writing to being so—

(a)the Commonwealth, a State or a Territory; or

(b)a Minister of the Commonwealth, a State or a Territory; or

(c)a body corporate established for a public purpose by a law of the Commonwealth, a State or a Territory, other than an incorporated company or association; or

(d)any judge, magistrate or other judicial officer of the Commonwealth, a State or a Territory; or

(e)any other officer of the Commonwealth, a State or a Territory, in his or her capacity as an officer.

1. There is no temporal limitation in s 33E(2) as to when consent can be given. It appears that the section is ambulatory and intended to have application at any stage in the proceeding. It follows that absent an order of the Court, the Commonwealth and the State or any other person described in s 33E(2) can give consent to being a group member at any point in time whilst the proceeding is on foot.

Effect of the amendments

1. The proposed group definition will exclude each of the categories (a) to (e) in s 33(2) from consenting in writing to become group members. However it will have a greater effect in that the exclusion sought extends beyond the scope of the subsection to include “all corporate or unincorporated bodies, established for a public purpose” – both State and Commonwealth.  This is in contrast to the statutory provision, which excludes only “a body corporate established for a public purpose by a law of the Commonwealth, a State or a Territory” – other than an incorporated company or association;  this exception presumably refers to associations or companies established under legislation such as the Incorporated Associations Act 1981 (Vic) or the Corporations Act 2001 (Cth).

1. The amendment also provides for a carve out from the exclusion of State municipalities and authorities[1] which have registered as a group member with Mrs Matthews’ lawyers and given consent to being included in the group.

   [1]A number of local councils, or municipalities, The Municipal Association of Victoria and Goulburn Valley Water have given consent.

Submissions of Mrs Matthews

1. Counsel for Mrs Matthews contend that the effect of the proposed amendment is to erect a wall around the group members to prevent the Commonwealth, the State or associated entities entering as a group member in the proceeding at a late point in time.  Such an amendment would mean that Mrs Matthews does not end up representing persons she had reasonably expected not to be part of the group.

1. In light of the impending mediation, Mrs Matthews is concerned with being able to identify the composition of the group with certainty to properly assist with the mediation process.  She says that it would be difficult to reach any compromise at the mediation or subsequently unless the Commonwealth and State are explicitly excluded from the group definition.  Any late claims lodged by the Commonwealth or State have the potential to significantly dilute the pool of money to be apportioned amongst the group members in the event of a successful settlement of the claim.

Submissions of SPI

1. SPI opposes the amendments, arguing that to exclude the various Commonwealth and State entities or persons from group membership in this proceeding would give rise to the problem of a potential duplication of this proceeding at a later stage.  It wants to have all potential claimants included within the group.

1. SPI also points to the disconformity in the proposed amendments and the terms of s 33E(2)(c): Mrs Matthews is seeking to exclude entities that currently fall squarely within the group definition and are not caught by the scope of s 33E(2) exclusion.

1. If I am against it on broadening the group, SPI has suggested an alternative course: that I do not allow the amendments sought by Mrs Matthews but that I make orders, pursuant to s 33ZF of the Supreme Court Act 1986 (Vic), to the effect that the Commonwealth and State bodies or persons covered by the proposed amendment provide particulars of claims (including particulars of loss and damage) by no later than 4.00pm on Friday 16 November 2012. It is submitted by SPI that this will enable meaningful mediation discussions to take place with a view to settling the full ambit of claims against SPI.

Submissions of The State

1. The State does not oppose its exclusion or that of any State entities covered by S33E(2) from group membership (except those who have already provided consent). However it opposes any exclusion which goes beyond the reach of the subsection. It says there is no basis upon which to exclude these bodies (certain incorporated associations or companies) which are currently group members. Any such exclusion would be inappropriate in principle.

1. It also argues that adopting a group definition which differs from the statutory provision would complicate matters, leading to ‘unpredictable consequences’.  The only inclusion within the group of such organisations or bodies should be those which have already given consent to being group members. 

Submissions of The Commonwealth

1. The Commonwealth and any relevant Commonwealth entities do not and will not seek to be included in the group by  giving consent pursuant to s 33(2).

Analysis

1. I accept the contention of Mrs Matthews that it is in the interests of justice to have the class finally defined for the purpose of both the mediation and trial.  If the Commonwealth and State entities or persons identified in s 33(2) have not by this stage opted into the group by giving consent then they should be eliminated from this proceeding.  More importantly, there is no desire at the present time for those persons to participate as a member of the group, other than those which have given consent.

1. In my opinion, SPI cannot insist, as it originally maintained, that the Commonwealth, State or associated entities excluded by the operation of s 33(2) should be compelled to become part of the class.  Putting aside whether s 33Z would permit such a course of action (which I doubt) this approach is not consistent with the purpose of a class action regime set out in both the State and Commonwealth legislation.[2] It is not the intention of the legislature that every possible claimant be included in a group proceeding. Section 33J enables a group member to opt out and bring his or her own proceeding outside the class action if they see fit. It also, by s 33E(2), deliberately excludes from the group the Commonwealth and State as well as a number of persons and entities related to those bodies politic. It is not part of the court’s function to compel persons to join a class with limited membership. Indeed, group membership, as Multiplex v Dawson Nominees Pty Ltd[3] demonstrates, can be confined to a limited or “closed class” of persons.  In this country, class action provisions do not seek to cover the field in terms of litigation arising out of a single event or closely interrelated events.

   [2]Part 4A of the Supreme Court Act 1986 and Part IVA of the Federal Court Act 1976.

   [3]Multiplex Funds Management Ltd v P Dawson Nominees Pty Ltd (2007) 164 FCR 275.

1. Whilst the objectives of representative proceedings, which include reduction of costs, enhancing access to justice, efficiency in utilising court resources and consistency of outcome, [4] are all highly desirable, they do not come at the expense of an individual’s right to litigate his or her claim separately.

   [4]Australian Law Reform Commission Grouped Proceedings in the Federal Court Report No 46 (1988) [13].

1. Indeed, in this case there is already an example of duplicated litigation arising out of the Kilmore East bushfire.  Proceedings have been issued by other State entities, such as the DSE, Parks Victoria, Roads Corporation and the Department of Education and Early Childhood Development, in relation to damage sustained as result of this fire.[5] Those bodies could, as I read s 33E(2), have given consent and become part of the group. Alternatively, as they have chosen, they can remain outside the group and litigate independently.

   [5]Proceeding No 02050 of 2012.

1. I reject SPI’s application to compel the Commonwealth or the State (or any related entities) to provide particulars of loss and damage for the purpose of the mediation.  Simply put, they are not making any claims for loss in the course of this proceeding and it would be inappropriate to make the new orders sought by SPI, if indeed there was any power to do so.

1. Finally, there is the question of the extended exclusion sought by Mrs Matthews to include in the carve out certain State or Commonwealth incorporated associations or companies.  No convincing argument has been advanced as to why such unilateral action should be taken in respect of bodies who, up until now, are group members – assuming they have not opted out pursuant to s 33J. Admittedly, it is difficult to identify exactly what organisations, if any, fall within this category – but that of itself should not permit the risk to be run that an organisation which is by statute part of the group now be excluded.

1. In summary, I will order that any exclusion of the Commonwealth or State bodies or persons proposed by the plaintiff should be formulated so that it reflects the structure of s 33E(2). I will also allow the proposed amendment exempting local councils and other organisations which have given consent to group membership by 30 October 2012.

Orders

1.A declaration that: the group members in this proceeding do not include the following persons:

(i)the Commonwealth, a State or a Territory; or

(ii)a Minister of the Commonwealth, a State or a Territory; or

(iii)a body corporate established for a public purpose by a law of the Commonwealth, a State or a Territory, other than an incorporated company or association, provided that any such body which by 30 October 2012 had registered as a group member with the plaintiff’s solicitor shall be a group member; or

(iv)any judge, magistrate or other judicial officer of the Commonwealth, a State or a Territory;

(v)any other officer of the Commonwealth, a State or a Territory, in his or her capacity as an officer.

And

2.That Mrs Matthews’ statement of claim be amended accordingly.