Mercantile Mutual Insurance (Australia) Limited v Hans Juergen Edmund Schigulski No. SCGRG 93/302 Judgment No. 4015 Number of Pages 4 Practice and Procedure Appeal

[1993] SASC 4015

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA DEBELLE J

CWDS
Practice and procedure - appeal - Split trial - Judgment on issues of liability - Later judgment by consent as to damages - Appeal from decision as to liability - Appeal not instituted until after judgment as to damages - whether appeal is out of time. TAG Pacific Ltd v McSweeney (1992) 106 ALR 651 and White v Brunton (1984) 1 QB 570, discussed.

HRNG ADELAIDE, 2 April 1993 #DATE 25:6:1993
Counsel for appellant:     Mr P D Pedlar
Solicitors for appellant:    Adams Kandelaars
Counsel for respondent:     Mr P A R Scragg

ORDER
Application refused.

JUDGE1 DEBELLE J The respondent issued proceedings out of the Local Court of Adelaide against the appellant insurance company claiming damages as a result of the appellant's refusal to indemnify him pursuant to the terms of the contract of insurance made on 8 July 1988. 2. By agreement of the parties, the action came on for hearing on the question of liability only. The learned magistrate who heard the action made the following note in his reasons for judgment: "This action came on for hearing on the issue of liability. Quantum will be the subject of further consideration after my ruling on liability." 3. The action was heard on 1 May and 20 August 1991 and on 19 March 1992. The magistrate held that the appellant was liable to indemnify the respondent under the contract of insurance. He concluded his reasons in these terms: "For all these reasons I find for the plaintiff and invite the parties to consider their position of (sic) quantum. If unable to agree I invite the parties to make arrangements with my clerk for the matter to be re-listed on a mutually convenient date for further hearing." 4. The reasons for judgment were delivered on 24 April 1992. Thereafter the parties were able to agree damages in the sum of $8,000. On 27 January 1993 the learned magistrate entered judgment for the respondent in the sum of $8,000 with costs to be taxed or agreed. 5. By notice dated 24 February 1993 the appellant appealed against the judgment. The grounds of appeal go only to the question of liability. The respondent has applied for an order that the appeal be dismissed on the ground that it has been instituted out of time. The respondent contends that the judgment as to liability delivered on 24 April 1992 was a final judgment. 6. It is necessary to resolve one issue of fact which appears to be central to the submissions of the respondent. The respondent's solicitor has sworn affidavits on 18 March and 14 April 1993 in which he states that the trial had initially proceeded on the basis that quantum would be reserved and resolved between the parties. The appellant's solicitor has also sworn an affidavit. He says that there was a split trial on the issues of liability and damages in order to avoid what might be unnecessary expense for the appellant in flying two witnesses from Whyalla. He says that the appellant agreed to a request to this effect made by the respondent. He adds that he believed that there was no final judgment until the question of damages had also been determined. I find that the account given by the appellant's solicitor is correct. It is consistent with the words I have quoted from the magistrate's reasons. I find, therefore, that the parties agreed to split the trial so that there would first be a determination of liability and then, if damages could not be agreed, a determination of the issues as to damage. 7. The respondent then says that, whatever was agreed between the parties, the decision delivered on 24 April 1992 was a final judgment from the which the appellant could have appealed. He calls in aid the decision in TAG Pacific Limited v McSweeney (1992) 106 ALR 651. In that decision it was held applying the reasoning in White v Brunton (1984) 1 QB 570 that, where parties had agreed to a split trial on the issues of liability and damages, a finding on the question of liability is a final and not an interlocutory judgment so that a party dissatisfied with the determination of liability is at liberty to appeal without having to obtain leave to do so. 8. As I understand the reasons for judgment in both TAG Pacific Limited v McSweeney and White v Brunton, a factor which loomed large in the reasoning was the desire of each court to advance the efficient administration of justice, to avoid unnecessary expense, and to avoid putting obstacles in the path of parties seeking to proceed by way of split trials. In White v Brunton Sir John Donaldson MR said (at 573):
    "It is plainly in the interests of the more efficient
    administration of justice that there should be split trials in
    appropriate cases, as even where the decision on the first part
    of the split trial is such that there will have to be a second
    part, it maybe desirable that the decision shall be appealed
    before incurring the possibly unnecessary expense of the second
    part. If we were to hold that the division of a final hearing
    into parts deprived the parties of an unfettered right of appeal,
    we should be placing an indirect fetter upon the ability of the
    Court to order split trials. I would therefore hold that where
    there is a split trial or more accurately, in relation to a
    non-jury case, a split hearing, any party may appeal without
    leave against an order made at the end of one part if he could
    have appealed against such an order without leave if both parts
    had been heard together and the order had been made at the end of
    the complete hearing." 9. In TAG Pacific Limited v McSweeney a further factor in the reasoning was a possibility that the resolution of issues of liability might assist the parties in reaching a compromise on the issues of damage. Olney J said (at 659):
    "Apart from the question of costs to which I have already
    referred there is the advantage to both parties that in the event
    of the appeal not succeeding, the assessment of damages would be
    approached in the certain knowledge that the applicants will
    succeed to some extent. This may well provide an incentive for
    the settlement of that issue without the need for the Court's
    further involvement, something that is highly unlikely to occur
    while the question of liability remains subject to testing on
    appeal." 10. But I do not understand the reasons in either case to deny a party the right to wait until the issues as to both liability and damages have been resolved before deciding whether to appeal. Policy considerations such as the efficient administration of justice, the desire to avoid unnecessary cost and the desire to encourage split trials apply with equal force to permitting the time for appeals to commence from the date when the Court makes its final determination on all issues. A defendant might prefer to wait until damages have been determined, confident in the belief that they might not be so large as to warrant an appeal or, at least, preferring to wait to see whether the award justifies an appeal. Further, there might be a real possibility of saving costs if one appeal only is prosecuted. There is a further consideration. Pursuant to Rule 75.02 a court may order that one or more questions of fact be tried before others or that one or more points of law be disposed of before others. It will not usually be desirable that a party should be able to appeal in relation to each of the several points of fact or law which are being determined. There may be many instances where it is more appropriate for all matters to be determined before an appeal is instituted. 11. For these reasons, I do not think that in the case of a split trial, a party dissatisfied with the determination of liability is bound to appeal before the determination of the issues as to damage. Thus, in the case of split trials, while a party is at liberty to appeal from a determination of issues as to liability, he may delay the institution of his appeal until both the issues of liability and damage have been determined, that is to say, until there is a final determination of all issues in the action. The final determination of all issues in this action occurred on 27 January 1993 when the learned magistrate entered judgment for the respondent. The appellant has appealed within the time prescribed by Rule 97.04. The appeal was therefore instituted within time. 12. Even if I am wrong in concluding that the time for appeal does not run until the final determination of all issues, I would in all the circumstances of this case have been prepared to extend the time within which to appeal. There is no suggestion of prejudice nor could such a submission be properly made. The parties have not prosecuted this action with any vigour. They did not agree the quantum of damages until shortly before 27 January 1993. The appellant's solicitor says that he did not believe the judgment was a final judgment. In a number of cases of this kind, it has been held that a party should not be penalised by the conduct of his solicitor. In all the circumstances this would be an appropriate case in which to extend the time within which to appeal. 13. For all of these reasons, I refuse the application of the respondent that the appeal be dismissed on the ground that it is out of time.