Nau v Kemp & Associates - [2010] NSWCA 164

No judgment structure available for this case.

Reported Decision: 77 NSWLR 687

New South Wales

Court of Appeal

CITATION: Nau v Kemp & Associates [2010] NSWCA 164

HEARING DATE(S): 7 December 2009

JUDGMENT DATE:
12 July 2010

JUDGMENT OF: McColl JA at 1; Campbell JA at 113; Sackville AJA at 243

DECISION: (1) Grant leave to appeal
(2) Direct a notice of appeal, in the form contained in the white book, be filed within seven days
(3) Appeal allowed
(4) Set aside the orders made in the District Court on 20 February 2009 in matter 4603 of 2005
(5) In lieu thereof, order that the Notice of Motion of each Respondent be dismissed with costs
(6) Respondents to pay costs of the Appellant of the appeal, but to have a certificate under the Suitors Fund Act 1951 if qualified.

CATCHWORDS: TORTS – the law of torts generally – joint or several tortfeasors – contribution – general – effect of settlement against one tortfeasor – legislation preventing double recovery – purpose and effect of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – undercompensation irrelevant for purposes of operation of s5(1)(b) – TORTS – the law of torts generally – general principles – meaning of “damages awarded” in s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946– “damages awarded” extends only to circumstances where the court has assessed the quantum of those damages in the context of s5(1)(b) – TORTS – negligence – apportionment of responsibility and damages – principles and mode of apportionment – DAMAGES – measure and remoteness of damages in actions for tort – measure of damages – legislation limiting amount of damages available – effect of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – PROCEDURE – judgments and orders – effect of judgments – whether “damages awarded” extends to include judgments giving effect to settlement amongst parties for the purposes of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – meaning of “damage” – WORDS AND PHRASES – “damage” – “damages awarded”

LEGISLATION CITED: Civil Liability (Contribution) Act 1978 (UK)
Civil Liability Act 2002
Companies Act 1929 (19 & 20 Geo V c 23)
District Court Act 1973
District Court Rules 1973
Insurance Contracts Act 1984 (Cth)
Interpretation Act 1987 (NSW)
Law Reform (Contributory Negligence and Tortfeasor's Contribution) Act 1947 (WA)
Law Reform (Married Women and Tortfeasors) Act 1935 (UK)
Law Reform (Miscellaneous Provisions) Act 1946 (NSW)
Law Reform (Miscellaneous Provisions) Act 1955 (ACT)
Law Reform (Miscellaneous Provisions) Act 1956 (NT)
Law Reform (Miscellaneous Provisions) Act 1965 (NSW)
Law Reform Act 1936 (NZ)
Law Reform Act 1995 (Qld)
Lord Cairns Act
Rules of the Supreme Court, 1883 (Eng)
Supreme Court Act 1970
Transport Accident Act 1986 (Vic)
Uniform Civil Procedure Rules 2005
Workers Compensation Act 1987 (NSW)
Workers Rehabilitation and Compensation Act 1986 (SA)
Wrongs Act 1936 (SA)
Wrongs Act 1985 (Vic)

CATEGORY: Principal judgment

CASES CITED: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27
Alexander v Perpetual Trustees WA Pty Ltd [2004] HCA 7; (2004) 216 CLR 109
Ayling v BHP Direct Reduced Iron Pty Ltd [2001] WADC 252; (2001) 27 SR (WA) 274
Baker v Hallett [2004] QSC 132
Bakker v Joppich (1980) 25 SASR 468
Ballina Shire Council v Volk (1989) 18 NSWLR 1
Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) [1988] 2 All ER 880
Barisic v Devenport [1978] 2 NSWLR 111
Baxter v Obacelo Pty Ltd (2000) 48 NSWLR 522
Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635
Baylis v Waugh [1962] NZLR 44
Belan v Casey [2003] NSWSC 159; (2003) 57 NSWLR 670
Bitumen and Oil Refineries (Australia) Ltd v Commissioner for Government Transport [1955] HCA 1; 92 CLR 200
Boncristiano v Lohmann [1998] 4 VR 82
Bracks v Smyth-Kirk [2009] NSWCA 401; (2009) 263 ALR 522
Bracks v Smyth-Kirk [2010] HCATrans 145
Brambles Constructions Pty Ltd v Helmers [1966] HCA 3; (1966) 114 CLR 213
Brinsmead v Harrison (1872) LR 7 CP 547
Bryanston Finance Ltd v de Vries [1975] QB 703
Chamberlain v Deputy Commissioner of Taxation (ACT) [1988] HCA 21; (1988) 164 CLR 502
CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384
Collector of Customs v Agfa Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389
Compania Sansinena de Carnes Congelads v Houlder Brothers & Co Ltd [1910] 2 KB 354
Dairy Containers Ltd v NZI Bank Ltd; Auditor-General [1995] 2 NZLR 30
Dillingham Constructions Pty Ltd v Steel Mains Pty Ltd (1975) 132 CLR 323
Eccles v Taylor [1995] 2 VR 482
Electrolux Home Products Pty Ltd v Australian Workers’ Union [2004] HCA 40; (2004) 221 CLR 309
Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; 230 CLR 89
Gedeon v Commissioner of the New South Wales Crime Commission [2008] HCA 43; (2008) 236 CLR 120
George Wimpey & Co Ltd v British Overseas Airways Corporation [1955] AC 169
Glynn v Challenge Recruitment Australia Pty Ltd [2006] NSWCA 203
Harvey v Phillips [1956] HCA 27; (1956) 95 CLR 235
Heaton v AXA Equity & Law Life Assurance Society plc [2002] UKHL 15; [2002] 2 AC 329
Hickson v Goodman Fielder Ltd [2009] HCA 11; (2009) 237 CLR 130
In the Marriage of Harris & Caladine [1991] HCA 9; (1991) 172 CLR 84
Isaacs v Ocean Accident & Guarantee Corporation Ltd (1958) 58 SR (NSW) 69
James Hardie & Co Pty Ltd v Seltsam Pty Ltd [1998] HCA 78; (1998) 196 CLR 53
Jameson v Central Electricity Generating Board [1998] QB 323
Jameson v Central Electricity Generating Board [2000] 1 AC 455
John Holland (Constructions) Pty Ltd v Jordin (1985) 36 NTR 1
King v Hoare (1844) 13 M & W 494; 153 ER 206
Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; (1985) 156 CLR 522
Merryweather v Nixan (1799) 8 TR 186; 101 ER 1337
Mitsubishi Motors Australia Ltd v Harbord (1997) 69 SASR 75
Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273
Paino v Hofbauer (1988) 13 NSWLR 193
Palmer v Wick and Pulteneytown Steam Shipping Co Ltd [1894] AC 318
Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; 147 CLR 589
Potter v Minahan [1908] HCA 63; (1908) 7 CLR 277
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [1945] HCA 50; (1945) 70 CLR 141
Ramsay v Pigram [1968] HCA 34; (1968) 118 CLR 271
Reichel v Magrath (1889) 14 App Cas 665
Residual Assco Group Limited v Spalvins [2000] HCA 33; (2000) 202 CLR 629
Ripper v Gatenby [2002] TASSC 45
Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; (2001) 53 NSWLR 198
Rogers v The Queen (1994) 181 CLR 251
Sadler v The Great Western Railway Co [1896] AC 450
Saeed v Minister for Immigration and Citizenship [2010] HCA 23
SAS Trustee Corp v Budd [2005] NSWCA 366; (2005) 3 DDCR 382
Smurthwaite v Hannay [1894] AC 494
South Australia v Mountford [2001] SASC 85; (2001) 79 SASR 389
Spicer v Carmody (1948) 48 SR (NSW) 348
Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691
Stott v West Yorkshire Road Car Co Ltd [1971] 2 QB 651
Tanska v Transport Accident Commission [2000] VSC 56; (2000) 30 MVR 561
The Koursk [1924] P 140; (1924) Lloyd’s Rep 228
Thomas v State of New South Wales [2008] NSWCA 316; (2008) 74 NSWLR 34
Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574
Thomson Australian Holdings Pty Ltd v Trade Practices Commission [1981] HCA 48; (1981) 148 CLR 150
Unsworth v Commissioner For Railways (1958) 101 CLR 73
Wah Tat Bank Ltd v Chan [1975] AC 507
Walton v Gardiner (1993) 177 CLR 378
XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1985) 155 CLR 448

TEXTS CITED: Fleming on Torts, 2nd ed (1961) Law Book Co
Glanville Williams, Joint Torts and Contributory Negligence, (1951) Stevens & Sons Limited
Latin Words & Phrases for Lawyers, Law and Business Publications (Canada) Inc 1980
Law Commission (Great Britain), Law of Contract: Report on Contribution, Law Com No 79 (1977)
Law Revision Committee (Great Britain), Third Interim Report, Cmnd 4637 (1934)
Law Revision Committee (Great Britain), Fourth Interim Report, Cmnd 4770 (1934)
Salmond on Torts, 12th ed (1957) Sweet & Maxwell
Spencer Bower and Handley, Res Judicata, 4th ed (2009) LexisNexis
The Shorter Oxford English Dictionary on Historical Principles (3rd ed)
United Kingdom, Parliamentary Debates, House of Commons, 8 July 1935, series 5, vol 304

PARTIES: Cherrylle Nau (Appellant)
Kemp & Associates Pty Ltd t/as Active Working Solutions (First Respondent)
Amanda Tarn (Second Respondent)

FILE NUMBER(S): CA 40151/09

COUNSEL: S Norton SC; M Causer (Appellant)
HJ Halligan (First Respondent)
A Leopold SC; MS White (Second Respondent)

SOLICITORS: Brydens Law Office (Appellant)
Colin Biggers & Paisley (First Respondent)
Lander & Rogers (Second Respondent)

LOWER COURT JURISDICTION: District Court

LOWER COURT FILE NUMBER(S): 4603/05

LOWER COURT JUDICIAL OFFICER: Robison DCJ

LOWER COURT DATE OF DECISION: 20 February 2009

CA 40151/09
DC 4603/05

McCOLL JA
CAMPBELL JA
SACKVILLE AJA
12 JULY 2010

CHERRYLLE NAU v KEMP & ASSOCIATES PTY LTD

Headnote

(This headnote does not form part of the Court’s judgment)

Facts

1 The Appellant alleged that in December 1999, whilst working for the Department of Education and Training, she sustained injury through heavy lifting.

2 Between August 2002 and December 2002 she was sent to the First Respondent, a corporation that provided rehabilitation services, for a supervised gymnasium program. The Second Respondent is a natural person, and was the person who devised and supervised the particular exercises that the Appellant undertook.

3 The Appellant further alleged that in the period between March 2004 and August 2004, while carrying out work at a school opened by the Department, she was again given inappropriate work to do, which brought about an injury to her right shoulder.

4 The Appellant commenced an action against the Respondents in 2005 (“the 2005 Action”), in which the Appellant alleged that the exercises that the Respondents required her to do were inappropriate and caused her to suffer an injury to her shoulder and shock.

5 The Appellant later commenced an action against the State of New South Wales (“the 2007 Action”), alleging that the State

6 Both matters were listed to be heard together. The parties to both matters participated in a mediation shortly before the intended hearing date. No settlement was achieved in relation to the 2005 Action. However, either at the mediation, or soon afterwards, counsel for the two parties to the 2007 Action signed Terms of Settlement. A judicial registrar made orders giving effect to the Terms of Settlement which included entering by consent, a judgment in the Appellant’s favour for $220,000 inclusive of costs and relieving her of liability to repay workers’ compensation payments she had received.

7 Following the settlement of the 2007 Action and payment in full of the judgment sum in the 2007 Action, counsel for one or more of the Respondents applied to have the 2005 Action dismissed.

8 The judge in the court below dismissed the 2005 Action, on the basis that the Appellant had already recovered damages from another tortfeasor for the injury that was the subject of the action, s5(1)(b) of the Law Reform (Miscellaneous Provisions) Act 1946 prevented her from receiving any greater sum as a consequence of the 2005 Action, and thus continuance of the 2005 Action was an abuse of process.

9 The Appellant appealed against the summary dismissal of the 2005 Action.

Recoveries pursuant to s5(1)(b) Law Reform (Miscellaneous Provisions) Act only prohibited if “double dipping”?

10 The judgment of Kirby J in Baxter v Obacelo Pty Ltd (2001) 205 CLR 635 does not justify a conclusion that recoveries pursuant to a second action are only prohibited pursuant to s5(1)(b) of the Law Reform (Miscellaneous Provisions) Act if they result in “double dipping” by the injured party: [190] per Campbell JA.

Baxter v Obacelo Pty Ltd

Relevance of Appellant intending to keep on foot her action against the Respondents

11 While the Terms of Settlement in the 2007 Action show an intention on the part of the Appellant to continue her action against the Respondents, this does not have any relevance for the application of s5(1)(b): [191] per Campbell JA.

12 The effect of section 5(1)(b) depends on

a Whether damage has been suffered by someone as a result of a tort;
b Whether more than one action has been brought in respect of that damage by or on behalf of the person to whom it was suffered against tortfeasors liable in respect of the damage;
c Whether there is any “amount of the damages awarded by the judgment first given”, and if so, how much it is: [191] per Campbell JA.

Relevance of amount of damages awarded by judgment first given not providing full compensation

13 If there has been undercompensation in the amount of damages awarded by the judgment first given, this does not have any relevance for the application of s5(1)(b): [191] per Campbell JA.

14 The effect of s5(1)(b) is such that the amount of damages awarded by the first judgment given limits the total of sums recoverable under all judgments for the one damage, regardless of the manner in which the amount of damages awarded by the first judgment might have been calculated: [195] per Campbell JA.

Barisic v Devenport

Unsworth v Commissioner for Railways

15 “Damage” refers to the injury or harm wrongfully inflicted and not to damages and disabilities. The ability of a party to maintain successive actions is qualified by whether or not it is the same harm that is the subject matter of each action. It does not matter that there are different causes of action for the same loss or that there is a statutory limitation on the damages recoverable for one of those causes of action: [197]-[200] per Campbell JA.

State of South Australia v Mountford

Requirement that there be “damages awarded”

16 The preferable construction is that there are “damages awarded”, within the meaning of s5(1)(b), only if the court has assessed the quantum of those damages: [230] per Campbell JA and [266], [269] per Sackville AJA.

Tanska v Transport Accident Commission

Baxter v Obacelo Pty Ltd

Residual Assco Group Limited v Spalvins

Collector of Customs v Agfa Gevaert Ltd

Per McColl JA:

17 The proper construction of s 5(1)(b) requires an understanding of its constituent elements in the context of s 5(1), and with regard to its underlying purpose.

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue

CIC Insurance Ltd v Bankstown Football Club Ltd

Network Ten Pty Ltd v TCN Channel Nine Pty Ltd

Thomas v State of New South Wales

18 The judgment entered by consent in the 2007 Action pursuant to terms of settlement expressed to be “without admission of liability” did not establish that the State was a tortfeasor “liable” for the purposes of s 5(1)(b) (at [68]).

Isaacs v Ocean Accident & Guarantee Corporation

Ltd

Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574; Stott v West Yorkshire Road Car Co Ltd [1971] 2 QB 651 considered

James Hardie & Co Pty Ltd v Seltsam Pty Ltd

19 The textual indication in s 5(1)(b) that “damages awarded by …judgment” refers to damages awarded by a court, is supported by the distinction which is drawn between a judicial assessment of damages, which ordinarily involve a judicial assessment of the entire extent of the plaintiff's loss or damage) and damages received in consequence of the settlement of an action, which may be by way of compromise (at [75] – [79], [101]).

Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635; Jameson v Central Electricity Generating Board [2000] 1 AC 455;

Heaton v AXA Equity & Law Life Assurance Society plc

20 The purpose of s 5(1)(b) is to cap a plaintiff’s damages in a successive action, where damages awarded in a first action fully recouped the plaintiff’s loss (at [100]).

Baxter v Obacelo Pty Ltd

21 The common law’s encouragement of the settlement of actions militates against a construction of s 5(1)(b) which might discourage settlement (at [104]).

Baxter v Obacelo Pty Ltd

Jameson v Central Electricity Generating Board

22 The language of s 5(1)(b) does not manifest a legislative intention to overthrow the common law principle that a plaintiff is entitled to pursue cumulative remedies in order to recoup fully the damage suffered as a result of a joint or concurrent tort (at [105]).

Potter v Minahan

Thompson v Australian Capital Television Pty Ltd

Baxter v Obacelo Pty Ltd

**********

CA 40151/09
DC 4603/05

McCOLL JA
CAMPBELL JA
SACKVILLE AJA

12 JULY 2010

CHERRYLLE NAU v KEMP & ASSOCIATES PTY LTD

Judgment

1 McCOLL JA: I have had the benefit of reading Campbell JA’s reasons in draft and shall rely on his recitation of the facts (and adopt his nomenclature) except where circumstances otherwise dictate. I agree with his Honour (at [128] – [131]) that this is a case which warrants a grant of leave to appeal.

2 For the following reasons, I agree with the orders Campbell JA proposes.

The issue

3 The issue posed by this case is whether s 5(1)(b) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) (the “1946 Act”) applies in circumstances where, in the District Court proceedings Campbell JA has described as the “2007 Action”, the appellant and the State of NSW (the “State”) agreed to Terms of Settlement dated 10 October 2008, which relevantly stated:

1. Amend pleadings in accordance with ‘Annexure A’ to these Terms.

2. Verdict and Judgment for the Plaintiff against the Defendant in the sum of $220,000 inclusive of costs.

Workers’ Compensation Act

…

6. Noted the above settlement represents a compromise by the Plaintiff based on liability issues and quantum issues.

7. These terms not to be disclosed except as required by law.

8. The parties note that this is a settlement against the defendant in these proceedings only and is without prejudice to other claims the plaintiff has against the defendants in proceedings No: 4603 of 2005.”

4 It was common ground that Judicial Registrar MacDonald of the District Court made orders and notes giving effect to the Terms of Settlement on 17 November 2008. The Court has not been provided with a transcript of what transpired on 17 November 2008, or with a copy of the judgment as entered. However it has been provided with a copy of the Terms of Settlement which bear the Judicial Registrar’s signature over the date 17 November 2008, and the seal of the District Court of New South Wales. It might be assumed that the Judicial Registrar entered a verdict and judgment for the appellant against the State in the sum of $220,000 inclusive of costs and directed that judgment be entered accordingly. I shall refer to this judgment as the 2007 judgment. In making the orders set out in the Terms of Settlement it would appear the Judicial Registrar was exercising the jurisdiction to “give judgment, or order that judgment be entered, in the terms of an agreement between the parties” conferred by Uniform Civil Procedure Rules 2005 (“UCPR”), 36.1A. She was empowered to exercise that jurisdiction by s 18FB(1) of the District Court Act 1973 and the District Court Rules 1973, Pt 43A r 1. The judgment had effect as a judgment of the District Court (District Court Act, s 18FB(2)) and took effect on the day that order was made: UCPR, 36.4(1)(a). The District Court is a court of record: District Court Act, s 8. The State has paid the judgment.

5 The respondents contended in a strike-out application pursuant to UCPR, 13.4(1) in the District Court proceedings Campbell JA has described as the “2005 Action”, that the 2007 judgment was a “judgment first given” within the meaning of s 5(1)(b), with the consequence that the appellant could not recover under any judgment which may be given against them in the 2005 Action, any sum which exceeded the quantum of the 2007 judgment. The 2007 judgment having been satisfied, the respondents persuaded the primary judge to dismiss the 2005 Action as an abuse of process.

6 The appellant accepts that the 2007 judgment was a judgment “given” by the District Court of New South Wales. She contends, however, that s 5(1)(b) has no application in the circumstances of this case, primarily because it does not apply to a consent judgment given to implement the settlement of an action, but only to a judgment awarding damages given by a court after a contested hearing.

7 Section 5(1)(b) was discussed in Bracks v Smyth-Kirk [2009] NSWCA 401; (2009) 263 ALR 522 (special leave refused: Bracks v Smyth-Kirk [2010] HCATrans 145) – a case concerning the effect of the entry of judgment, after acceptance of an offer of compromise, in a first action against one joint tortfeasor on the plaintiff’s right to continue a second action against another joint tortfeasor. As Campbell JA has pointed out (at [130]) there are factual differences between Bracks and the present case. Importantly, the issue which arises in this case was not raised in Bracks where the appellant conceded on a summary judgment application that acceptance of the respondent’s submission that s 5(1)(b) applied would mean the proceedings constituted an abuse of process, a concession to which he was held in circumstances where he failed to identify any matters which would attract appellate interference with a discretionary decision: see Bracks (at [147]).

Legislative framework

8 Section 5 of the 1946 Act relevantly provides:

5 Proceedings against and contribution between joint and several tort-feasors

(1) Where damage is suffered by any person as a result of a tort (whether a crime or not):

(b) if more than one action is brought in respect of that damage by or on behalf of the person by whom it was suffered, or for the benefit of the estate, or of the spouse, brother, sister, half-brother, half-sister, parent or child, of that person, against tort-feasors liable in respect of the damage (whether as joint tort-feasors or otherwise) the sums recoverable under the judgments given in those actions by way of damages shall not in the aggregate exceed the amount of the damages awarded by the judgment first given; and in any of those actions, other than that in which judgment is first given, the plaintiff shall not be entitled to costs unless the court is of opinion that there was reasonable ground for bringing the action,

(c) any tort-feasor liable in respect of that damage may recover contribution from any other tort-feasor who is, or would if sued have been, liable in respect of the same damage, whether as a joint tort-feasor or otherwise, so, however, that no person shall be entitled to recover contribution under this section from any person entitled to be indemnified by that person in respect of the liability in respect of which the contribution is sought.

(3) For the purposes of this section:

…

(b) the reference in this section to ‘the judgment first given’ shall, in a case where that judgment is reversed on appeal, be construed as a reference to the judgment first given which is not so reversed and, in a case where a judgment is varied on appeal, be construed as a reference to that judgment as so varied, …”

9 Section 5(1) of the 1946 Act, as Campbell JA has explained (at [126]), substantially adopted s 6(1) of the Law Reform (Married Women and Tortfeasors) Act 1935 (UK) (the “1935 Act”).

10 Section 4 of the District Court Act defines “judgment in relation to an action” to mean “judgment given or entered up in the action”.

Background

11 The statement of claim in the 2007 Action against the State included a claim in relation to an injury the appellant said she had suffered to her left shoulder as a result of rehabilitation treatment she was given by representatives of Active Working Solutions (“Active”), the first respondent to this appeal, to whom the State referred her for treatment for a work-related back injury. The 2007 statement of claim pleaded two bases for the allegation that the State was liable for the appellant’s shoulder injury: first, it was alleged to have been “liable for the treatment imposed upon the [appellant] by Active Working Solutions” and, secondly, to have been “in breach of its duty of care to the [appellant] and … negligent.” As a result of those breaches, the appellant was said to have suffered “injury to left shoulder” and “shock”.

12 The statement of claim in the 2005 Action alleged that Active had been guilty of a breach of its duty of care to the appellant in the manner in which it sought to treat her back injury. In the event that Amanda Tarn (“Tarn”), the second respondent to this appeal (and the second defendant in the 2005 Action), was not a servant or agent of Active, the statement of claim alleged that she had owed the appellant the same duty of care as did Active and had breached it in the same manner. Insofar as it was alleged the appellant had suffered injury in consequence of Active/Tarn’s treatment, the injury she was said to have suffered in the 2005 Action was in the same terms as in the 2007 Action: “injury to left shoulder” and “shock”.

13 The first allegation in the 2007 Action appears to have been intended to propound a case of vicarious liability on the State’s part for Active’s acts or omissions. The second allegation in the 2007 Action appears to have been intended to advance a case of personal liability against the State. In the 2005 Action the appellant also alleged Active and Tarn were personally liable for her shoulder injury.

14 The plea in the 2007 Action that the State was vicariously liable for Active’s acts or omissions in causing the appellant’s left shoulder injury sought to characterise the State and Active as joint tortfeasors: Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635 (at [24]) per Gleeson CJ and Callinan J. The two pleas of personal liability against the State, Active and Tarn in the respective actions coupled with the allegation that State and Active/Tarns’ acts or omissions had lead to the same “damage” to the appellant’s left shoulder was an allegation that their separate acts combined to produce the same damage: injury to the appellant’s left shoulder and shock, thus characterising them as concurrent tortfeasors: see Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; (1985) 156 CLR 522; Baxter (at [24]) per Gleeson CJ and Callinan J. On either pleaded basis, the State, Active and Tarn were tortfeasors within the meaning of s 5(1)(b).

15 In addition to her point of statutory construction, the appellant raised two arguments of a factual nature. First, while she accepted that if the parties to the 2005 and 2007 actions were, in fact, tortfeasors in any of the senses to which s 5(1)(b) referred, those actions were brought in respect of the same “damage”. However, she submitted that the primary judge ought not have dismissed the 2005 Action without determining whether, notwithstanding the pleadings in the two actions, the State, Active and Tarn were in fact tortfeasors within the meaning of s 5(1)(b). While she appeared to accept the statements of claim in the two actions pleaded that the parties to the respective actions were concurrent tortfeasors, she noted that in the 2007 Action the State had denied liability for Active’s rehabilitation treatment. She contended, accordingly, that a court may have held Active/Tarn’s rehabilitation treatment had broken the chain of causation – with the consequence that they alone were responsible for the damage to her left shoulder – and, consequently, not tortfeasors within s 5(1)(b).

16 Secondly, the appellant contended the primary judge ought to have determined whether the 2007 judgment represented the full amount of her claim for damages in respect of injury to her left shoulder – a point which appeared to be subsumed in her submission that the fact any damages against the State were limited to economic loss by virtue of s 151G of the Workers Compensation Act 1987 (NSW) meant the 2007 judgment could never represent satisfaction at common law for her claim against all tortfeasors liable in respect of the damage to her left shoulder injury.

Construction of section 5 of the 1946 Act

17 Within 10 years of its enactment, s 5 of the 1946 Act was described as “a piece of law reform which seems itself to call somewhat urgently for reform”, which “has not yielded any clear answer to those who have sought in its terms solutions of the not inconsiderable number of problems that arise from its operation”: Bitumen & Oil Refineries (Aust) Ltd v Commissioner for Government Transport [1955] HCA 1; (1955) 92 CLR 200 (at 211 – 212) per Dixon CJ, McTiernan, Webb, Fullagar and Taylor JJ; see also Baxter (at [71] – [72]) per Kirby J.

18 Regrettably the plea for law reform was not taken up by the legislature. In James Hardie & Co Pty Ltd v Seltsam Pty Ltd [1998] HCA 78; (1998) 196 CLR 53 (a case concerning s 5(1)(c)), Gaudron and Gummow JJ said (at [7]) that the 1946 Act had become notorious for the conceptual and practical difficulties it engendered and was an example of the need to keep measures of law reform under legislative review for defects and inadequacies exposed from time to time by the actual operation of such measures.

19 The difficulties in construction to which s 5(1) gives rise have been attributed to the drafter’s use of a technique criticised as seeking to make the provision perform a double function: to deal with substantive liabilities or substantive legal relations and to give jurisdiction with reference to them: see James Hardie (at [22]) per Gaudron and Gummow JJ, citing Dixon J, R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [1945] HCA 50; (1945) 70 CLR 141 (at 165 – 166).

20 Comparatively early in the history of s 6(1) of the 1935 Act, Lord Reid was not prepared to make any assumption that the language of the comparable English provision had been used accurately, nor, having regard to the “defective drafting of other parts of the subsection”, was he prepared to “rely on any inference from the form of drafting of subsection (1)(a)” when construing subsection (1)(c): George Wimpey & Co Ltd v British Overseas Airways Corporation [1955] AC 169 (at 188). His Lordship’s remarks were endorsed by the Judicial Committee of the Privy Council in Wah Tat Bank Ltd v Chan [1975] AC 507 (at 517). Drawing on Lord Reid’s observations, Salmon LJ later held that in considering s 6(1)(c), if (as Lord Reid held in George Wimpey) the word “liable” could “have a different meaning in two paragraphs of the same subsection, [he could] find no overwhelming reason why it should not have a different meaning in the same paragraph of the subsection”: Stott v West Yorkshire Road Car Co Ltd [1971] 2 QB 651 (at 658).

21 Notwithstanding judicial gloom about the construction of s 5(1), the task of construing s 5(1)(b) must begin with a consideration of its text, which, if clear, as the High Court has recently said, cannot be displaced by historical considerations and extrinsic materials: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 (at [47]) per Hayne, Heydon, Crennan and Kiefel JJ. At the same time, the Court cannot lose sight of the statutory direction to prefer a construction that would promote the underlying purpose or object of s 5(1)(b): Interpretation Act 1987 (NSW), s 33. As will be recalled, the literal meaning of a provision may “wear a very different appearance” in the light of the context, the mischief which the statute was designed to overcome and the objects of the legislation: CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384 (at 408) per Brennan CJ, Dawson, Toohey and Gummow JJ; see also Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273 (at [11]) per McHugh A-CJ, Gummow and Hayne JJ.

22 Section 5(1)(b) must also be construed as far as possible so that it is consistent with the language and purpose of all the provisions of the statute and on the prima facie basis that its provisions are intended to give effect to harmonious goals. Conflict which “appears to arise from the language of particular provisions…must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions”: Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 (at [69], [70]) per McHugh, Gummow, Kirby and Hayne JJ. In applying this approach to s 5(1)(b), the Court should not lose sight of the criticism that judicial decisions concerning s 5, “calculated to remove one anomaly by an apparent beneficent construction of the legislation have given rise to other anomalies”: James Hardie (at [7]) per Gaudron and Gummow JJ.

23 In construing the 1946 Act it is also necessary to recognise that a statute should not be construed as “overthrow[ing] fundamental principles, infring[ing] rights or depart[ing] from the general system of law” unless it does so with “irresistible clearness”: Potter v Minahan [1908] HCA 63; (1908) 7 CLR 277 (at 304) per O’Connor J; the presumption is an aspect of the rule of law: Electrolux Home Products Pty Ltd v Australian Workers’ Union [2004] HCA 40; (2004) 221 CLR 309 (at [21]) per Gleeson CJ; cited with approval in Saeed v Minister for Immigration and Citizenship [2010] HCA 23 (at [15]) per French CJ, Gummow, Hayne, Crennan and Kiefel JJ. That principle is an aid in achieving the fundamental object of statutory construction, namely:

the need for unmistakable and unambiguous language to interfere with important principles of government and of the rule of law.

Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574 (at 613) per Gummow J; see also Gedeon v Commissioner of the New South Wales Crime Commission [2008] HCA 43; (2008) 236 CLR 120 (at [51]) per Gummow, Kirby, Hayne, Heydon, Crennan and Kiefel JJ.)

Submissions

24 The parties’ competing contentions tended to focus upon different parts of s 5(1)(b), rather than looking at it as a whole.

25 The appellant’s essential point on statutory construction was that the conclusion that a consent judgment satisfied s 5(1)(b) would confound the underlying policy of the common law to encourage settlement: Baxter (at [75]) per Kirby J. However she also embraced the proposition that the words “damages awarded” in s 5(1)(b) pointed to the “judgment first given” having to be the product of a judicial determination on the merits.

26 The respondents submitted, in substance, that s 5(1)(b) was satisfied because the 2007 judgment was a judgment first given in an action by way of damages.

The text of s 5(1)

27 A literal construction of s 5(1)(b) favours the appellant in some respects.

28 First, as Campbell JA (at [204] – [218]) and Sackville AJA (at [258] – [262]) have explained, prima facie (subject to displacement arising from considerations of context, history or policy) the better view is that the expression “damages awarded by … judgment” in s 5(1)(b) refers to damages awarded by a court, not agreed by way of a settlement of an action.

29 Secondly, the proposition that “judgment first given” in s 5(1)(b) refers to a judgment given by a court derives some support from s 5(3)(b) which contemplates that a “judgment first given” for the purposes of s 5 may be reversed on appeal. That language is generally inapposite to refer to a consent judgment. The general rule is that once a consent judgment is perfected it can only be set aside in a fresh action brought for that purpose: Harvey v Phillips [1956] HCA 27; (1956) 95 CLR 235 (at 242 – 244); In the Marriage of Harris & Caladine [1991] HCA 9; (1991) 172 CLR 84 (at 104) per Brennan J; Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691 (at 696 – 697) per Handley JA (Mahoney and Clarke JJA agreeing). The Court of Appeal has an exceptional jurisdiction to entertain by leave an appeal from a consent judgment or order: Supreme Court Act 1970, s 101(2)(c); District Court Act, s 127(2)(e), enabling it, for example, to entertain by leave an appeal from a consent judgment or order which was beyond the court’s jurisdiction to make: Thomson Australian Holdings Pty Ltd v Trade Practices Commission [1981] HCA 48; (1981) 148 CLR 150 (at 163) per Gibbs CJ, Stephen, Mason and Wilson JJ; or, again by leave, an appeal in the exceptional circumstances discussed in Paino v Hofbauer (1988) 13 NSWLR 193. However the limited circumstances in which such a power might be exercised supports the proposition that “a judgment first given” in s 5(1)(b) must be one given after a judicial determination on the merits.

30 Thirdly, insofar as it might be contended a subsequent action is an abuse of process, s 5(1)(b) does not bar proceedings, rather, s 5(1)(b) limits recoverability: Baxter (at [29]) per Gleeson CJ and Callinan J; Bracks (at [150]).

31 However these observations, like the parties’ submissions, relate only to parts of s 5(1)(b). The construction of s 5(1)(b) cannot turn upon a consideration of the isolated expressions in the subsection nor on one subsection in isolation from the remainder of the provision. The text not leading to a clear construction, it is necessary to look at the context in which s 5(1)(b) appears, at the purpose of s 5(1) and, to that end, to have regard to its history which explains the mischief it was intended to address. This task involves, to some extent, deconstructing s 5(1)(b) to understand the nature of the critical elements, “tortfeasors liable”, “judgment first given” and “damages awarded”, and which element, if any, plays a controlling role in its construction and how those elements interact to achieve its purpose – an approach Campbell JA has aptly described as a “particular application of the concept of the hermeneutic circle”: Thomas v State of New South Wales [2008] NSWCA 316; (2008) 74 NSWLR 34 (at [22]).

The pre-1946 Act position

32 The mischief s 5 was intended to address is best understood by explaining the position at common law in Australia as between a plaintiff injured by a tort caused by joint or concurrent tortfeasors prior to the introduction of s 5(1) of the 1946 Act. The position, relevantly, was that:

(1) By virtue of the rule in Brinsmead v Harrison (1872) LR 7 CP 547 (see also King v Hoare (1844) 13 M & W 494; 153 ER 206), a person who suffered damage as a result of a joint tort had only one cause of action which merged in the first judgment recovered in respect of it, even where there was no satisfaction: Thompson (at 581) per Brennan CJ, Dawson and Toohey JJ.

(2) Where an action was brought against two or more joint tortfeasors only one judgment for one sum of damages could be given in favour of the plaintiff: Thompson (at 581) per Brennan CJ, Dawson and Toohey JJ; Baxter (at [20]) per Gleeson CJ and Callinan J.

(3) Because a plaintiff had only one cause of action against joint tortfeasors, an unqualified release of one joint tortfeasor released the others: Thompson (at 581 – 582) per Brennan CJ, Dawson and Toohey JJ; (at 608 – 611) per Gummow J; Baxter (at [26]) per Gleeson CJ and Callinan J.

Bryanston Finance Ltd v de Vries

“[S]o long as the earlier judgment remained unsatisfied it was not a bar at common law to a subsequent action against any other of the [concurrent] tortfeasors nor did it affect the measure of damages that might be awarded in any subsequent action. So the person who sustained the damage could sue the independent tortfeasors seriatim in the hope of recovering a greater sum by way of damages than that awarded in the first action.”

(5) The liability of several concurrent tortfeasors was solidary; although there was a separate cause of action against each they were liable in the same amount: Glynn v Challenge Recruitment Australia Pty Ltd [2006] NSWCA 203 (at [20]) per Giles JA (Beazley and McColl JJA agreeing).

(6) A plaintiff was entitled to separate judgments for the full amount against concurrent tortfeasors held to be liable whose wrong produced the same damage: Bracks (at [100]).

(7) A concurrent tortfeasor sued by a plaintiff who had already recovered damages from another concurrent tortfeasor could plead the defence of satisfaction which applied if “the plaintiff's settlement with the other has fully compensated him for the separate wrongs done to him”: Jameson v Central Electricity Generating Board [1998] QB 323 (at 338) per Auld LJ; approved in Baxter (at [56]) per Gummow and Hayne JJ as applying in Australia to both joint and concurrent tortfeasors; see also Thompson (at 608) per Gummow J (Gaudron J agreeing).

Bracks

33 The principle of satisfaction to which Lord Diplock referred in Bryanston is important. It was discussed in Baxter in which the High Court held that s 5(1)(b) did not apply to a case where a plaintiff brought one action against joint tortfeasors, settled against one, with judgment entered in their favour for the settlement sum, then sought to pursue the proceedings against the remaining joint tortfeasor. However the court also considered whether, aliter the statute, the remaining tortfeasor could resist the plaintiff’s claim by invoking the defence of satisfaction, as explained by Auld LJ in Jameson (at 338) (see [32](7) above). It held he could not, because the documents effecting the settlement demonstrated the plaintiffs intended to pursue their action against the remaining tortfeasor and had not accepted the settlement sum in full satisfaction of their loss: (at [49]) per Gleeson CJ and Callinan JJ; (at [69]) per Gummow and Hayne JJ; (at [90]) per Kirby J.

The

Law Reform (Married Women and Tortfeasors) Act

1935 (UK)

34 The 1935 Act, which led to the passing of the 1946 Act, addressed reforms recommended by the Law Revision Committee (Great Britain), Third Interim Report, Cmnd 4637 (1934) (the “Third Interim Report”). The Law Revision Committee was tasked with considering, inter alia, the common law doctrine that there could be no contribution between tortfeasors and “the liability of a husband for the torts of the wife” and “the liability of a married woman in tort and contract” (at [1]). The Third Interim Report addressed the contribution issue and what the Committee apparently perceived to be related issues.

35 The Law Revision Committee’s Fourth Interim Report, Cmnd 4770 (1934) (at [23]), addressed the issue of a husband’s liability for his wife’s torts and, inter alia, recommended the abolition of the common law rule under which husbands were responsible for their wife’s torts and also for her liabilities. The reforms proposed in both the Third and Fourth Interim Reports found their way into the 1935 Act – hence its name.

36 The Third Interim Report noted (at [3]) the anomaly of the common law rule against contribution (which the Committee (at [4]) traced to Lord Kenyon LCJ’s judgment in Merryweather v Nixan (1799) 8 Term Rep 186; 101 ER 1337). The anomaly was that a plaintiff could recover the full amount of damage from one joint tortfeasor, but the latter had “to bear the whole loss and the other wrongdoers escape liability”. In contrast, the Committee pointed out, rights of contribution generally existed in cases of breach of contract. After noting criticisms of the rule, judicially engrafted exceptions and distinctions and the statutory right of contribution created by s 37(3) of the Companies Act 1929 (19 & 20 Geo V c 23), the Committee concluded (at [7]) that the common law rule should be altered “as speedily as possible.”

37 The Committee also referred (at [7]) to The Koursk [1924] P 140; (1924) Lloyd’s Rep 228 as also showing that “where independent acts of negligence result in one injury, [i.e. a concurrent tort] the cause of action against each Defendant is separate and distinct; but there is no contribution between the Defendants.” It concluded, “when two persons each contribute to the same damage suffered by a third, the one who pays more than his share should be entitled to recover contribution from the other.”

38 Although the Third Interim Report was directed to addressing the issue of contribution, it went beyond its remit and considered matters not only related to rights of contribution between tortfeasors, but also a plaintiff’s rights against joint tortfeasors. In this respect, it recommended (at [11]) the abolition of the rule in Brinsmead v Harrison.

39 In Bracks (at [103]) McColl JA (Allsop P agreeing) observed:

Brinsmead v Harrison

the Law Revision Committee noted that the merits of the rule were said to be the prevention of a multiplicity of actions as well as the possibility that a second jury might award more damages than the first.

‘with the provision that the plaintiff should not be able to obtain by execution, in the aggregate, more than the amount awarded in the first judgment’.

‘The Koursk’

40 The Committee’s concerns about a multiplicity of actions reflected Kelly CB’s statement in Brinsmead v Harrison (at 551) that if the rule did not exist:

“An unprincipled attorney might be found willing enough to bring an action against each and every of them, and so accumulate a vast amount of useless costs”.

41 The Committee recommended (at point (I) of its Summary of Suggested Recommendations) that a:

“judgment recovered against one or more persons in respect of an actionable wrong committed jointly, [should] not, while unsatisfied, be a bar to an action against any others liable jointly in respect of the same wrong”.

“…the Plaintiff shall not be entitled to levy execution for, or to be paid, a sum exceeding, in the aggregate, the amount of the first judgment obtained against any of the persons so liable, nor to recover the costs of any subsequent action, unless the Judge before whom it is tried is of the opinion that there was reasonable ground for bringing it.”

42 Despite the fact the Third Interim Report’s first recommendation and proviso applied only to joint tortfeasors, s 6(1)(b) of the 1935 Act extended to all classes of tortfeasors liable “whether as joint tortfeasors or otherwise” in respect of the damage suffered by the plaintiff as a result of their torts.

43 Point (II) of the Summary of Suggested Recommendations proposed the creation of a right of contribution as between joint tortfeasors. Point (III) made the same recommendation in respect of concurrent tortfeasors. Both rights of contribution were to be subject to the exception that contribution was not available if the person against whom it was sought proved an entitlement to be indemnified in respect of his, her or its liability to the other tortfeasor.

44 In Bracks (at [104]) I misread the recommendation summarised at point (III) to extend the proviso in recommendation at point (I) to concurrent tortfeasors and thence to be reflected in the English equivalent of s 5(1)(b) of the 1946 Act. In fact, as Campbell JA points out (at [156]), that is not so.

45 Section 6(1)(b) of the 1935 Act no longer exists in the United Kingdom. The Law Commission (Great Britain), Law of Contract: Report on Contribution, Law Com No 79 (1977), led to the enactment the Civil Liability (Contribution) Act 1978 (UK) (the “1978 Act”). Section 3 of that Act removed from the English legislation the limitation on the amount which might be recovered under a judgment in successive actions against the same class of persons to whom s 6(1)(b) of the 1935 Act had applied, leaving only the costs sanction: 1978 Act, s 4. The reforms effected by the 1978 Act have been largely adopted in the Wrongs Act 1985 (Vic): Alexander v Perpetual Trustees WA Pty Ltd [2004] HCA 7; (2004) 216 CLR 109 (at [23] – [24]).

The purpose of section 5(1) of the 1946 Act

46 Section 5 was a law reform measure which, however clumsily drafted, was intended to enlarge the rights of plaintiffs against joint tortfeasors, and of tortfeasors inter se.

47 The purpose of s 5(1)(a) was to abolish the rule in Brinsmead v Harrison.

48 The purpose of s 5(1)(b) has been said to be “to prevent excessive recovery by a plaintiff consequential on the creation of multiple causes of action against tortfeasors” (XL Petroleum (NSW) Pty Ltd v Caltex Oil (Aust) Pty Ltd [1985] HCA 12; (1985) 155 CLR 448 (at 469) per Brennan J); an observation which, as was pointed out in Bracks (at [106]), should be understood to be confined to joint tortfeasors, they being the only defendants against whom multiple causes of action were newly created. Gibbs CJ observed in XL Petroleum (at 458) that the object of s 5(1)(b) was “to prevent a multiplicity of actions”.

49 In Baxter (at [29]) Gleeson CJ and Callinan J (with whom Gummow and Hayne JJ agreed on the construction of s 5(1)(b)) expressed the view that s 5(1)(b) appeared to be directed to the problem of multiplicity of actions against joint tortfeasors, and several concurrent tortfeasors, operated in relation to the recoverability of sums awarded under judgments rather than upon rights of action, did not bar proceedings but limited recoverability, was also concerned with legal costs and (at [36]) has an effect that might be described as preventing double recovery.

50 Kirby J (with whose reasons respecting the construction of s 5(1)(b) Gummow and Hayne JJ also agreed), referred to the fact that the general object of the 1935 Act “was, relevantly, to abolish the old rule that release of one joint tortfeasor automatically released the other so far as the law was concerned” – an object effected by s 5(1)(a): Baxter (at [85]). In his Honour’s opinion, s 5(1)(b) had to be construed in the context of the principal object of the legislative reform and (at [87]) in a manner which was consistent with the object reflected in s 5(1)(a):

“[C]ontrol of the aggregate recovery so as to prevent double dipping by reason of the reform effected in par (a); and control of the recovery of multiple costs in several actions against concurrent tortfeasors where it would have been reasonable for the plaintiff to have brought one action, that is one proceeding.”

51 According to Professor Glanville Williams, one of the objects of permitting subsequent actions by plaintiffs against all classes of tortfeasors as contemplated by s 5(1)(b) was “to prevent injustice to a plaintiff who finds that the tortfeasor whom he has chosen to sue is insolvent”: Glanville Williams, Joint Torts and Contributory Negligence, (1951) Stevens & Sons Limited (at §10(2), p 39). This reform was of particular importance for a plaintiff who had suffered damage as a result of a joint tort, who recovered judgment against one tortfeasor which could not be enforced and who, at common law, because of the rule in Brinsmead v Harrison, could not have brought an action against any other joint tortfeasor.

52 In Brambles Constructions Pty Ltd v Helmers [1966] HCA 3; (1966) 114 CLR 213 (at 217), Barwick CJ (McTiernan J agreeing), after referring to the unsatisfactory nature of the drafting of s 5(1)(c), described its general purpose as being “clear enough”, saying:

the legislature desired on the one hand to expose all tort-feasors who had caused or contributed to the same damage to suit by the injured party notwithstanding the recovery of judgment against any of them

53 The uncertainty to which his Honour referred is manifest in decisions on s 5(1)(c) which preceded and post-dated Brambles which are discussed later in these reasons.

The effect of section 5(1)

54 The effect s 5 of the 1946 Act had on the common law cannot be understood without an overview of the changes it wrought.

55 First, s 5(1)(a) abolished the rule in Brinsmead v Harrison both in cases where joint tortfeasors were sued in the one action as well as where separate actions were brought: Baxter (at [25]) per Gleeson CJ and Callinan J, applying XL Petroleum. It permitted successive actions to be brought against individual joint tortfeasors: Ramsay v Pigram [1968] HCA 34; (1968) 118 CLR 271 (at 288) per Taylor J (Kitto J agreeing). As the effect of s 5(1)(a) was that the cause of action against joint tortfeasors was no longer one and indivisible, the rule that a release given by one joint tortfeasor released any other joint tortfeasor was also held to have been impliedly abolished by its Australian Capital Territory counterpart: Thompson (at 584) per Brennan CJ, Dawson and Toohey JJ.

56 Secondly, as I have said, s 5(1)(b), in cases where it operates, has an effect that might be described as preventing double recovery: Baxter (at [36]) per Gleeson CJ and Callinan J. That effect operates in respect of all tortfeasors liable in respect of the damage suffered by a person as a result of a tort. Insofar as it applies to concurrent tortfeasors, it curtails a plaintiff’s common law rights whereunder a plaintiff could recover a larger judgment in a second action against a concurrent tortfeasor than recovered in the first, because the second judgment effectively cannot be for more than the first (The Koursk): Glanville Williams (at §10(2)).

57 Thirdly, s 5(1)(b) limits the recovery of compensatory damages. Thus if the evidence in successive actions were to lead to differing awards of compensatory damages, it would prevent the judgment creditor from receiving an amount exceeding the amount first awarded: XL Petroleum per Brennan J (at 466); see also Mason J (at 464).

58 The effect of the severance of the causes of action against joint tortfeasors is that, notwithstanding s 5(1)(b), a plaintiff can recover different awards of damages against joint tortfeasors, whether in the same or different proceedings, where the difference lies in one joint tortfeasor alone being liable for exemplary damages: XL Petroleum (at 454) per Gibbs CJ (Wilson J agreeing); Mason J (at 464); Brennan J (at 469 470); referred to with apparent approval in Baxter (at [20]) per Gleeson CJ and Callinan J.

59 Fourthly, s 5(1)(c), taken with s 5(2) created a right and remedy of contribution which did not exist at common law: James Hardie per Gaudron and Gummow JJ (at [2], [24]); per Kirby J (at [60]) (McHugh J agreeing); per Callinan J (at [116]); Alexander v Perpetual Trustees WA Ltd (at [2]) per Gleeson CJ, Gummow and Hayne JJ. That entitlement is “conferred only between certain parties [who] must answer the criteria specified in s 5(1)(c)”: James Hardie (at [24]), per Gaudron and Gummow JJ. The claim of a tortfeasor for contribution is a cause of action apart from, and independent of, the cause of action which the injured party has or would have had against the tortfeasor from whom contribution is sought: Brambles (at 218) per Barwick CJ; see also James Hardie (at [28]). The claimant tortfeasor’s cause of action to claim contribution does not arise until judgment is given ascertaining that tortfeasor’s liability, although that fact does not preclude a claim for contribution being instituted in anticipation of the resolution of the main action: James Hardie (at [30]) per Gaudron and Gummow JJ.

60 Finally, in XL Petroleum (at 469), Brennan J expressed a view, albeit obiter, that s 5(1)(b) fixes the maximum sum in respect of which an order for contribution could be made under s 5(1)(c). Thus just as subsections (a) and (b) address different, although related, topics (Baxter (at [35]) per Gleeson CJ and Callinan J), there is a relationship between paragraphs (b) and (c) of s 5(1) which will become apparent in the course of the discussion which follows.

61 It is necessary now to turn to consider the three elements of s 5(1)(b) earlier identified, “tortfeasors liable”, “judgment first given” and “damages awarded”. It is convenient to commence with the “judgment” issue,

The “judgment” issue

62 There is no doubt, as s 4 and s 8 of the District Court Act make plain (and as the appellant accepted), that the 2007 judgment is a judgment given by a court of record and prima facie within s 5(1)(b). However that conclusion does not answer the question of construction: is it a “judgment” as contemplated by s 5(1)(b)?

63 The respondents’ primary argument is that a consent judgment entered by a court creates an issue estoppel and that it is not open to a court to investigate the circumstances in which it came to be agreed or recorded by a court.

64 Consent judgments attract the operation of the doctrine of res judicata, however “[t]he fact that a judgment is entered by consent may on occasion make it hard to say what was necessarily decided by the judgment, especially where it is the defendant who wishes to bring action at a later date”: Chamberlain v Deputy Commissioner of Taxation (ACT) [1988] HCA 21; (1988) 164 CLR 502 (at 508) per Deane, Toohey and Gaudron JJ; see also (at 505) per Brennan J; (at 512) per Dawson J; see also Spencer Bower and Handley, Res Judicata, 4^th ed (2009) LexisNexis at ([2.16]ff).

65 The observation in Chamberlain referred to in the previous paragraph gave, as an illustration, Isaacs v Ocean Accident & Guarantee Corporation Ltd (1958) 58 SR (NSW) 69. In that case, Street CJ and Roper CJ in Eq held (at 75) that orders made by consent create an estoppel as between parties “only as to those matters which are necessarily decided”, to ascertain which:

“…the court will closely examine all such evidence, if any, as is available and admissible, and, by the aid of such materials, will ascertain whether any and what adjudication of matters in dispute was expressed, or necessarily involved, in the actual decision assented to.”

66 In Isaacs, a consent judgment for Winslett was entered against Isaacs in an action in which Winslett claimed damages for personal injuries sustained through allegedly negligent driving by Isaacs’ servant or agent. The consent judgment was entered pursuant to terms of settlement which required that "without admission of liability verdict to be entered in favour of the plaintiff". The trial judge entered a verdict for Winslett for £4500 and directed that judgment be entered. Judgment was entered in accordance with the Rules of Court – it contained no reference to the terms of settlement. Isaacs subsequently sought to claim damages from Winslett for the latter’s allegedly negligent driving in the same accident.

67 Street CJ and Roper CJ in Eq (Owen J dissenting) held (at 75 – 76) that the fact the parties had by express agreement removed from the court’s consideration any question of Isaacs’ liability to Winslett, meant that no estoppel adverse to Isaacs arose on the issue of liability. Accordingly as the parties’ intention that “the judgment, when entered, was not to be taken as establishing that [Isaacs] was in fact liable to [Winslett]” appeared in the court record, their Honours found it could not conclude the issue of liability had been determined adversely to Isaacs: Isaacs (at 76). This conclusion was described as correct in principle in Mitsubishi Motors Australia Ltd v Harbord (1997) 69 SASR 75 (at 90 – 91) per Doyle CJ (with whom Matheson and Olsson JJ agreed). The learned Chief Justice also observed that Isaacs was referred to in Chamberlain in the context of res judicata, in a manner which, in his view, did not limit the High Court’s apparent approval of the decision to such estoppels.

68 Section 5(1)(b) only applies if more than one action is brought against “tortfeasors liable in respect of the damage”. Isaacs is authority for the proposition that the 2007 judgment which, it will be recalled, was entered pursuant to terms of settlement expressed to be “without admission of liability” did not establish that the State was in fact liable to the appellant. Accordingly, if “liable” in s 5(1)(b) means “liable by judgment”, the consent judgment did not meet that criterion.

69 However, in George Wimpey both Lord Reid (at 188) and Lord Keith (at 195) expressed a view, which was not essential to the disposition of the case, that “liable” in s 6(1)(b) of the 1935 Act could not mean “held liable” but, in context, meant “against whom there is a cause of action” (Lord Reid, at 189) or “liable to have a decree entered against him if sued to judgment” (Lord Keith, at 195). These dicta appear to be the only attempt to give content to the word “liable” in s 5(1)(b).

70 However, the meaning of the word “liable” in s 5(1)(a) and s 5(1)(c) is the subject of considerable authority. Consent judgments expressed to be “without admission of liability” have been held to establish a tortfeasor’s liability for the purposes of that tortfeasor making a contribution claim under s 5(1)(c) of the 1946 Act – but only to a limited extent, as shall become apparent. There does not appear to be any case which has held that the same reasoning applies to the liability to which s 5(1)(b) refers. I will return to the issue of the meaning of the word “liable” in s 5(1).

71 Before leaving this area, I note that the second respondent drew attention to two judgments which she submitted should be applied as demonstrating that consent judgments are effective for the purposes of legislation in like terms to s 5(1)(b).

72 In Baker v Hallett [2004] QSC 132 (at [31]), Holmes J recorded a submission by counsel for a defendant seeking to resist a plaintiff pursuing a claim for damages in respect of which the plaintiff had earlier settled proceedings with another tortfeasor which led to the entry of a consent judgment in the plaintiff’s favour, which judgment had not been satisfied. Counsel submitted that that s 6(b) of the Law Reform Act 1995 (Qld) precluded the plaintiff recovering any amount greater than that the subject of the consent judgment. There does not appear to have been any debate as to whether or not the consent judgment constituted a “judgment” for the purposes of s 6(b), rather her Honour disposed of the submission by saying s 6(b) bore on what may be recovered, not whether the claim should proceed. Baker casts no light on the issue in these proceedings.

73 In Ayling v BHP Direct Reduced Iron Pty Ltd [2001] WADC 252; (2001) 27 SR (WA) 274, Blaxell DCJ held (at [14]) that a consent judgment obtained in the Albany District Court could not “be treated as a fiction for any purpose…[and] was a judgment fixing the quantum of damages allegedly suffered by the plaintiff as a result of a tort, and clearly was a judgment within the meaning of s 7(1)(b) of the Law Reform (Contributory Negligence and Tortfeasor's Contribution) Act 1947 (WA).” It appears (see [16]) that the plaintiff invited his Honour to “look behind the judgment to ascertain what claim or claims for damages the parties intended that it should meet.” It is not clear what materials his Honour was invited to examine to determine the settling parties’ intention. While his Honour accepted (at [16]) that the plaintiff and his solicitor did not intend that the consent judgment should satisfy the total claims for damages arising from his injuries, he regarded (see [21]) the fact that a consent judgment had been entered and satisfied as conclusive in barring the plaintiff from obtaining any further judgments in respect of the same damage. I would assume from that conclusion that the materials his Honour was invited to examine did not form part of the court record.

74 However as Isaacs (at 75) demonstrates, it is open to the Court to have regard to the record which includes the terms of settlement as filed in order to determine what is necessarily decided by a judgment. That course was taken in Baxter (see [15] – [17]) which was decided a few weeks after Ayling. It is a course open to this Court where the terms of settlement were filed and, accordingly, formed part of the record. It is sufficient to say that Ayling appears distinguishable.

The award of damages issue

75 As I have said (at [28]) the better view is that, prima facie, “damages awarded by …judgment” refers to damages awarded by a court. The conclusion that that is the meaning which should be ascribed to those words in s 5(1)(b) is supported by the distinction which is drawn between a judicial assessment of damages and damages received in consequence of the settlement of an action.

76 In Baxter (at [40], [42]) in discussing the principles of recovery and satisfaction, Gleeson CJ and Callinan J distinguished between a judicial assessment of damages that “will ordinarily involve a judicial assessment of the entire extent of the plaintiff's loss or damage” and a consent judgment which may be by way of compromise. A judicial assessment of damages, where the judgment had been satisfied (at [47]):

“…will put an end to any claim, or possible claim, against another tortfeasor, whether a joint tortfeasor or one of several concurrent tortfeasors [because] the damage, as assessed by judicial decision, has been fully recouped and the claim against another tortfeasor lacks a subject matter. Where…damage is an essential element of the cause of action, that element will have gone.”

77 In contrast, their Honours observed the same conclusion only followed in the case of a settled action if (at [48]):

“[A] settlement agreement manifested a common intention of the parties to the agreement that the settlement sum was to be paid and received in full satisfaction of the rights of the plaintiff, against the defendant or anyone else, in relation to the loss or damage incurred”.

78 As the evidence in Baxter (which included a consent judgment, terms of settlement and a deed of release) made it clear that the respondents were not accepting the settlement sum in full satisfaction of the loss or damage they said they had incurred and demonstrated they always intended to pursue their claim against the appellant, proceeding with the action did not offend the rule against double recovery/satisfaction: Baxter (at [49]) per Gleeson CJ and Callinan J; see also Gummow and Hayne JJ (at [69]); Kirby J (at [92]).

79 The premise accepted in Baxter, that a sum received by way of settlement may not reflect the full amount of a plaintiff’s loss reflects the proposition that a sum received by way of a settlement illustrates “the plaintiff's chances of success in the action” in contradistinction to the amount awarded by a judge which proceeds on the basis that “the action has, ex hypothesi, succeeded…[s]o there is no room for any discount”: Jameson v Central Electricity Generating Board [2000] 1 AC 455 (at 467) per Lord Lloyd; see also Heaton v AXA Equity & Law Life Assurance Society plc [2002] UKHL 15; [2002] 2 AC 329 (at [3] – [5]) per Lord Bingham of Cornhill (with whom Lord Steyn and Lord Hope of Craighead agreed).

The meaning of “liable” in section 5(1)

80 In James Hardie (at [12]), Gaudron and Gummow JJ observed that the 1946 Act “represents an attempt to adjust the tripartite rights and interests of P, D1 and D2” adding that “[a]ny regime of this nature is at greater risk of generating anomalies where all those liable to suit are not sued at the same time and in the one proceeding.”

81 Section 5(1)’s adjustment of the tripartite rights and interests of P, D1 and D2 turns on the concept of a tortfeasor or tortfeasors being “liable” in respect of the “damage…suffered by any person as a result of a tort” as referred to in the opening words of the section. As I have said, the word “liable” has been held to have different meanings in the various subsections of s 5, although there is little authority considering its meaning in s 5(1)(b). The South Australian analogue of s 5(1)(b), s 25(1)(b) of the Wrongs Act 1936 (SA), was applied in South Australia v Mountford [2001] SASC 85; (2001) 79 SASR 389 to prevent a plaintiff who had been awarded damages against his employer by a court, which judgment had been satisfied, from pursuing a second action against a joint and/or concurrent tortfeasor. The damages in the first action were subject to a statutory limit by virtue of s 54 of the Workers Rehabilitation and Compensation Act 1986 (SA). The case turned on whether the actions were in respect of the same damage. Williams J (Olsson and Duggan JJ agreeing) held (at [34]), applying Mahony v J Krusich (Demolitions) Pty Ltd, that they were. It was not to the point that the plaintiff may have suffered “various damages…under different heads.” There was no discussion of s 25(1)(b) relevant to the issue in this case.

82 In Wah Tat the Privy Council held that the Singaporean equivalent of s 5(1)(a) abolished the rule in Brinsmead v Harrison in its entirety, whether or not joint tortfeasors were sued in one or more actions. In a passage referred to with apparent approval in Baxter (at [23]) per Gleeson CJ and Callinan J, Lord Salmon, giving the judgment of the Privy Council and speaking of the phrase in that subsection, “any other person who would, if sued, have been liable”, said (at 518):

held

liable

sued to judgment

83 Cases decided on the meaning of “liable” in s 5(1)(c) establish that not only a judicial finding of liability, but also consent judgments, as well as settlements made “without admission of liability”, can satisfy the threshold test in that subsection that a claimant for contribution be a “tortfeasor liable…”. These cases arguably depart from the meaning given to “liable” for the purposes of s 5(1)(a), reflecting Lord Reid’s view that “on any construction of the subsection the word ‘liable’ must be held to have quite different meanings in different places in the subsection”: George Wimpey (at 189).

84 There are two limbs to s 5(1)(c). The first requires the party seeking contribution to be a “tortfeasor liable” in respect of the “damages” referred to in s 5(1). The second requires the person from whom contribution is sought to be a “tortfeasor who is, or would if sued have been, liable in respect of the same damage.”

85 In George Wimpey (at 188 – 189) the House of Lords held that the word “liable” where it appeared in the second limb of s 6(1)(c) of the 1935 Act, meant “liable in judgment”, although their Lordships were unable to agree as to the construction of the sub-section on that basis: Bitumen & Oil Refineries (at 207).

86 Later authorities considering the first limb of s 5(1)(c) have not embraced the meaning of “liable” in the sense of “liable in judgment” which appealed to the House of Lords in George Wimpey.

87 Despite early cautious remarks as to whether the ascertainment of liability for the purposes of the first limb of s 5(1)(c) must be “by judgment to the exclusion, for example, of arbitral award or of agreement itself amounting to accord and satisfaction or of an agreement amounting to accord executory followed by satisfaction” (Bitumen & Oil Refineries (at 212)), later authority “admits of the sufficiency of at least some of those methods”: James Hardie (at [26]) per Gaudron and Gummow JJ; Thompson (at 616 – 617) per Gummow J (with whom Gaudron J relevantly agreed); Brambles (at 221) per Windeyer J.

88 In Brambles (at 219) Barwick CJ (McTiernan J agreeing) held that “a tort-feasor who has come under an enforceable obligation to pay money for the damage caused by his tortious act” could recover contribution from another tort-feasor who had also come under an obligation to pay money in respect of the same damage and from any other tort-feasor “who, not having been sued by the injured party, had he been sued [at any time], would have been found to have caused or contributed to the same damage by a tortious act.”

89 Subsequent authorities dealing with the meaning of “any tort-feasor liable” in the first limb of s 5(1)(c) have endorsed Barwick CJ’s view in Brambles, that that condition is satisfied if the party claiming contribution is subject to “an enforceable obligation to pay money for the damage caused by his tortious act”, whether or not that liability arises from a judgment after a contested hearing or a settlement.

90 In Thompson, which considered s 11(4) of the Law Reform (Miscellaneous Provisions) Act 1955 (ACT), the Australian Capital Territory equivalent of s 5(1)(c), Gummow J referred with approval (at 616 - 617) to authority supporting the proposition that the first limb requirement (“any tort-feasor liable”) included:

“[A] party whose liability has been ascertained upon a settlement whether or not reflected in a consent judgment, and that this is so whether or not in reaching the settlement the party now seeking contribution admitted liability.”

91 However, Gummow J also observed (at 616) that:

“[T]he party seeking contribution after such a settlement must be prepared in that proceeding to establish that, if the claim had been fought out, that party would have been held responsible in law and liable to pay in whole or in part for the damage referred to in s 11(4).”

92 The case to which Gummow J referred as authority for the proposition that liability for the purposes of the first limb of s 5(1)(c) can be established by a settlement was Stott, which his Honour observed had been followed in Bakker v Joppich (1980) 25 SASR 468 (at 472 – 473) per Wells J; John Holland (Constructions) Pty Ltd v Jordin (1985) 36 NTR 1 (at 11 – 12) per Nader J and Ballina Shire Council v Volk (1989) 18 NSWLR 1 (at 10) per Kirby P (Priestley JA and Hope AJA agreeing); and, as his Honour also observed, was foreshadowed in New Zealand by McGregor J in Baylis v Waugh [1962] NZLR 44.

93 In Stott the English Court of Appeal held that “liable” in the first limb of s 6(1)(c) of the 1935 Act means “responsible in law” and not “held liable in an action”. The consequence of that ruling was (per Lord Denning MR (at 657)):

) when he has settled the action by agreeing to make payment to the injured person,

even though, in making the settlement, he has not admitted liability.

Stott

94 The cases in Australia to which Gummow J referred in Thompson, in which Stott has been followed or referred to, have turned on the construction of legislation in substantially the same terms as the first limb of s 5(1)(c). In Bakker (at [473]), Wells J concluded that a defendant who had made an accord and satisfaction with the plaintiff pursuant to which he agreed to pay the plaintiff $75000 damages, was a “tortfeasor liable in respect of [the] damage” “suffered by” the plaintiff within the meaning of s 25 of the Wrongs Act 1936 (SA). In his Honour’s view, the word “liable” in the first limb of s 25(1)(c) comprehended all circumstances in which a defendant became:

“[U]nder any head, legally liable to the plaintiff to pay damages on account of acknowledged or alleged negligence [and]…exist[ed], inter alia, where the defendant has submitted to judgment on that account or has made an accord and satisfaction.”

95 In John Holland (Constructions) Pty Ltd, Nader J held that the cause of action to recover contribution from a joint tortfeasor pursuant to s 12(4) of the Law Reform (Miscellaneous Provisions) Act 1956 (NT) did not arise until judgment had been given or at least a settlement reached in the action against the plaintiff – in other words, until one or other of those events had occurred, the claimant for contribution was not a “tortfeasor liable in respect of the damage”. His Honour referred to the Court of Appeal’s views in Stott as the “most liberal” on the question whether a tortfeasor was “liable” so as to be able to claim contribution. Ballina Shire Council considered the meaning of “tortfeasor liable” in s (5)(1) but referred (at 10) to Stott (at 657) on a procedural point only.

96 In Baylis v Waugh, McGregor J held (at 49) that “liable” for the purposes of the first limb of s 17(1)(c) of the Law Reform Act 1936 (NZ), meant “responsible in law”. On that basis he concluded that a defendant who had made a payment into court, which had been accepted by the plaintiff, could make a claim for contribution from a third party, although in that claim it would have to prove that it was a tortfeasor liable at the time the monies were paid into court. This view, he noted (at 49 – 50), accorded with that expressed at the time in Salmond on Torts, 12^th ed (1957) Sweet & Maxwell (at 93) and Fleming on Torts, 2^nd ed (1961) Law Book Co (at 694). I note that it also accorded with that expressed by Glanville Williams (at §31(a)). In Dairy Containers Ltd v NZI Bank Ltd; Auditor-General [1995] 2 NZLR 30 (at 123), Thomas J described the conclusion reached in Stott and Baylis as a “sensible view … arrived at in order to permit a tortfeasor who had settled a claim to seek contribution from a joint tortfeasor”, but added “[s]uch a person has not, of course, been held liable in a judgment.”

220 The Second Reading Speeches in both England and New South Wales say nothing about why the limitation on recovery of damages and costs applies to several tortfeasors who cause the same damage. The focus of the New South Wales Second Reading Speech is on how section 5 affects joint tortfeasors, not several tortfeasors. Insofar as the New South Wales Second Reading Speech gives a reason for the introduction of section 5(1)(b), it is that it is a limitation on “the power that is given a plaintiff to sue a second defendant, where he has recovered judgment against the first”. That situation only applies so far as joint tortfeasors are concerned. Indeed, the Second Reading Speeches show no consciousness, on the part of either of the relevant Ministers, that the effect of section 5(1)(b), insofar as it applied to several concurrent tortfeasors, was to take away an existing right.

221 The objective of para (b) of the legislation is, as stated by Glanville Williams at page 39:

“… to prevent injustice to a plaintiff who finds that the tortfeasor whom he has chosen to sue is insolvent. It is no part of the policy of the Act that a plaintiff who has sued one tortfeasor, and who is dissatisfied with the assessment of his damages by the court, should be allowed to sue the other tortfeasor in the hope of obtaining a greater bite from the cherry.”

222 That objective does not apply where there has been no “assessment of damages by the court”.

223 In Baxter, at [2], Gleeson CJ and Callinan J said:

“There are many circumstances in which a person with a claim against a number of joint tortfeasors may wish to settle with one, or some, of them, and continue with, or commence, proceedings against others. The situation which arose in the present case is not unusual.”

224 The same can be said where a person with a claim against a number of several tortfeasors wishes to settle with one of them, and continue with or commence proceedings against others.

225 In Baxter v Obacelo Pty Ltd (2000) 48 NSWLR 522 Giles JA (with whom Mason P and Sheller JA agreed) held that the entry of the consent judgment against the principal did not have the consequence that, by reason of the rule against double satisfaction, the plaintiff could never recover more against the employed solicitor. That was, in essence, because one could not infer, from the entry of a consent judgment, that the amount of that consent judgment was intended to be the full measure of the loss suffered by the plaintiff. He said, at [67]-[68]:

“If the judgment against Mr Whitehead had been for damages assessed by the court, as distinct from a consent judgment for an amount agreed as part of the settlement, by the operation of the rule against double satisfaction the opponents would be precluded from continuing the proceedings against the claimant. The critical question, then, is whether the position is the same when the judgment against Mr Whitehead was a consent judgment for an amount agreed as part of the settlement.

In principle, the rule against double satisfaction should not operate, or should not necessarily operate, where the satisfied judgment is not for damages assessed by the court. The rationale for the rule is that, having been fully compensated for his loss, the plaintiff can not get more. Damages assessed by the court are by definition, as it were, full compensation for the plaintiff’s loss. But an amount agreed as or as part of a settlement is not necessarily full compensation for the plaintiff’s loss. Unless the settlement is in truth a capitulation, of its nature it will involve compromise, so that the amount is unlikely to be full compensation for the claimed loss and its relationship to the actual loss will be speculative. Further, the settlement may well be affected by matters not material to the assessment of the actual loss, such as the defendant’s impecuniosity. Still in principle, only if it is found as a fact that the settlement amount was received as full compensation for the plaintiff’s loss should the rule against double satisfaction operate to bar the plaintiff from proceeding against another tortfeasor or other tortfeasors.”

226 Reasoning to that effect was supported by Gleeson CJ and Callinan J in Baxter v Obacelo Pty Ltd (2001) 205 CLR 635 at [47]–[48]:

“If there has been a judicial assessment of the whole of the plaintiff's loss or damage, resulting in an award of damages by way of judgment in that amount against one tortfeasor, satisfaction of the judgment by that tortfeasor will put an end to any claim, or possible claim, against another tortfeasor, whether a joint tortfeasor or one of several concurrent tortfeasors, for two reasons. First, the damage, as assessed by judicial decision, has been fully recouped and the claim against another tortfeasor lacks a subject matter. Where, as here, damage is an essential element of the cause of action, that element will have gone. Secondly, it would be inequitable to permit additional recovery.

If there has been no judicial assessment of damages, then, in the light of current Australian authority on the effect of s 5(1)(a) of the Act, it would be anomalous if the consequences of a settlement with one tortfeasor upon a claim against another tortfeasor should turn upon the difference between a consent judgment and a Tomlin order, or between joint tortfeasors and several concurrent tortfeasors. If it would be unconscientious of the plaintiff to pursue a claim against another tortfeasor, or if the amount received pursuant to the settlement is, or ought to be regarded as, recoupment of the whole of the plaintiff's loss or damage, then action against another tortfeasor, whether in separate proceedings, or, where the other tortfeasor was a party to the original proceedings, by way of continuation of those proceedings, must fail. …”

227 While those remarks were made concerning the application of the rule against double satisfaction, they have a bearing upon the application of section 5(1)(b). The multitude of factors that could lead a plaintiff to accept a sum that was less than full compensation in settlement of a claim provide a reason why a blanket rule, prohibiting a plaintiff from recovering more in a second action against a concurrent tortfeasor than was recovered in a first action, could work unjustly. However, there is no analogous potential for injustice if the damages in the first action have been arrived at by judicial assessment (apart from what some may perceive as injustice arising from legislation that restricts the damages available in the first action, which if it be injustice at all, is an injustice imposed by Parliament, that the courts must accept). Further, as Kirby J (with whom Gummow and Hayne JJ agreed on section 5(1)(b)) said at [74] and [75] of Baxter (quoted at [178] and [179] above) there is a reason of legal policy not to construe an unclear statutory provision in a way that inhibits settlement of litigation.

228 While one can accept that one of the aims of section 5(1)(b) is preventing a multiplicity of actions, it is far from clear that that aim extends to stopping multiplicity of actions that do not all proceed to hearing and determination. It is in the case where there have been two separate hearings, each of which has gone to judicial determination of the quantification of the one item of a plaintiff’s damage, that the waste of resources of the parties and the court system is most apparent. There can be situations where there are multiple actions, but there is little if any such waste, such as when an action brought against one concurrent tortfeasor settles soon after the initiating process is issued.

229 Consider the situation of a plaintiff who had accepted a small sum in settlement of a claim against one several tortfeasor. It would be anomalous if that plaintiff were free to seek to obtain judgment and levy execution (for the judgment debt minus the amount recovered already) from another several concurrent tortfeasor if the first tortfeasor settled after litigation was threatened but not started, but not free to do the same if the settlement had occurred soon after a statement of claim was issued. It would be anomalous in the present case if the plaintiff could not proceed with the 2005 Action notwithstanding that that action had been listed to be heard together with the 2007 Action, but (as happened in Baxter) would have been free to proceed with it if her solicitors had gone through the formality of obtaining an order that the two actions be consolidated.

230 In my view there are no considerations of context, history or policy that displace the construction I arrived at by considering the meaning of the words of the provision. The preferable construction is thus that there are “damages awarded”, within the meaning of section 5(1)(b), only if the court has assessed the quantum of those damages. For that reason, the judge was wrong in summarily disposing of the 2005 Action.

231 If the action against the Respondents proceeds to trial, and liability is established, clearly the Appellant will be unable to receive from the Respondents damages to the extent that she has already been compensated by the State for the damage that she has suffered. There will be a problem in ascertaining how much of the damages that the State paid is to be attributed to exacerbation of the Appellant’s condition that arose from the activities of the Respondents, when the sum that the State paid her is a lump sum that covers damage sustained from three separate incidents, only one of which involved the Respondents. There may also be difficulties concerning how the court should treat the fact that the real value that the Appellant’s settlement attributed to the damage that she sustained in those three incidents is not $220,000 – it will be necessary to take into account that that sum was inclusive of costs, and also that the plaintiff was entitled to keep the amount of workers compensation benefits that the State had paid to her or for her benefit. That there are these difficulties is not a reason for being dubious about the construction of section 5(1)(b) at which I have arrived, because those problems would exist if section 5(1)(b) had never been enacted in a form that applied to several concurrent tortfeasors.

232 They are difficulties of fact, not of principle. In Mahony the High Court considered the availability of contribution between an allegedly negligent employer whose worker had been injured, and the doctor who had then allegedly treated the worker negligently. Gibbs CJ, Mason, Wilson, Brennan and Dawson JJ considered an objection to the availability of contribution that there was not the “same damage” because the damage for which the employer was liable would inevitably be more extensive than that for which the doctor was liable. At 531, their Honours rejected that objection, saying:

“It is clear, of course, that any damage for which [the employer] alone is liable could not be the subject of contribution by [the doctor], but there is no reason why the damage for which both alleged tortfeasors are liable cannot be identified and why s 5(1)(c) cannot operate with respect to that damage. The damage for which both tortfeasors are liable is indeed the same damage, but the circumstance that the first tortfeasor is alone liable for whatever damage is caused before the subsequent tort is committed is no argument against apportioning liability for the damage caused by to both tortfeasors."

Analogous reasoning is applicable in the present case.

Failure to Determine Cause of the Appellant's Injuries?

233 The final flaw that the Appellant alleges is that the judge could summarily dismiss the proceedings only if it was quite clear that the litigation was bound to be fruitless to the Appellant, and it was not clear that the proceedings would be fruitless when the judge had failed to determine certain factual matters.

234 One of those factual matters was said to be whether in truth the damage for which the Appellant sought compensation from the Respondents had been caused by the State. Ms Norton submitted that the only material the judge had available to him was the pleadings, the terms of settlement, and a brief account of procedural history contained in some solicitors’ affidavits. From that, it was not possible to tell whether the actions of the Respondents amounted to a novus actus interveniens, with the consequence that in truth the State had not caused any of the same damage that the Respondents had caused. Essential conditions for the operation of section 5(1)(b) are that “damage is suffered by any person as a result of a tort” and “more than one action is brought in respect of that damage”. The first of those conditions requires damage in fact to be suffered by a person as a result of a tort. A mere allegation of the suffering of damage as a result of a tort (as the Appellant had alleged against the State, so far as the exacerbation of injury arising from the intervention of the Respondents was concerned) is not enough, she submits, to satisfy that condition.

235 It is legally uncontroversial that if a plaintiff suffers bodily injury as a result of a tort, and in acting reasonably to seek treatment for that bodily injury is subjected to negligent medical treatment, the first tortfeasor can be liable (and indeed usually is liable) for the exacerbation of symptoms that results from the negligent medical treatment: Mahony. However, Mahony at 529-530 also recognised that “… medical negligence or inefficiency can be held to amount to a new cause of incapacity in some circumstances …”, such as when it is

“ ‘inexcusably bad’ … or ‘completely outside the bounds of what any reputable medical practitioner might prescribe’ … or ‘so obviously unnecessary or improper that it is the nature of gratuitous aggravation of the injury’ … or ‘extravagant from the point of view of medical practice for hospital routine’… In such a case, it is proper to regard the exacerbation of the plaintiff’s condition as resulting solely from the grossly negligent medical treatment or advice, and the fact that the plaintiffs acted reasonably in seeking and accepting the treatment or in following the advice will not make the original tortfeasor liable for that exacerbation.”

236 Ms Norton submits that it would require a trial to decide whether the treatment that the Respondents had given to the Appellant was so bad that the State bore no responsibility for the exacerbation of the Appellant’s condition caused by that treatment.

237 For that reason, she submits, the judge was premature in summarily dismissing the 2005 Action.

238 Mr Leopold submitted that it was not open to the Appellant to put that submission, when she had already received damages from the State on the basis that any exacerbation of her condition arising from the actions of the Respondents was a consequence of the State’s wrong to her. He submitted that it was significant that the 2007 Proceedings “are over”, and that the judgment in them is to be construed by reference to the pleadings in the action that claimed damages for (inter alia) the activities of the Respondents. Though he made reference to “approbating and reprobating”, and “abuse”, the argument was not developed in any depth.

239 It seems to me that deciding whether this submission of Ms Norton is one that the Appellant is free to make would involve clear identification of the precise principle that is being invoked, and examination of the case law relevant to that principle. One relevant principle might involve considering whether the Appellant had made an election to accept money from the State on the basis that the exacerbation of her injuries caused by the Respondents was in law caused by the negligence of the State. Another relevant principle might involve considering whether it would involve an abuse of process, of the type considered in Reichel v Magrath (1889) 14 App Cas 665, Walton v Gardiner (1993) 177 CLR 378 at 393, Rogers v The Queen (1994) 181 CLR 251 at 287–288 or Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; (2001) 53 NSWLR 198 for the assertion to be made. Glanville Williams, op cit, p 39–40 considered briefly (and rejected) an argument somewhat like Mr Leopold’s present submission, but cast in terms of estoppel.

240 When the submission has not been developed, and in the light of the conclusion I have already reached it is unnecessary to decide whether this particular submission is correct, it is preferable to leave it undecided.

Orders

241 Each Respondent had filed in the District Court a notice of motion that sought, in the alternative, dismissal of the 2005 Action, or leave to amend their respective defences to plead that the action was unmaintainable by virtue of section 5(1)(b). The only one of those prayers for relief that the judge dealt with was the order seeking dismissal. However, the conclusion that I have come to means that the order for amendment would be futile. Thus the whole of each Respondent’s Notice of Motion should have been dismissed. Each Respondent had on foot a cross-claim against the other. Consequential upon dismissing the Appellant’s action, the judge also dismissed each of those cross-claims. He also made some costs orders, that were consequential upon his decision to dismiss the claim. All those orders should be set aside.

242 I propose the following orders:

(1) Grant leave to appeal

(2) Direct a notice of appeal, in the form contained in the white book, be filed within seven days

(3) Appeal allowed

(4) Set aside the orders made in the District Court on 20 February 2009 in matter 4603 of 2005

(5) In lieu thereof, order that the Notice of Motion of each Respondent be dismissed with costs

243 SACKVILLE AJA: I am grateful to Campbell JA for setting out the background to and the issues arising on the application for leave to appeal and the appeal. I agree with the orders proposed by his Honour. I shall set out my own reasons for reaching this conclusion.

244 As Mr Leopold SC, who appeared with Mr White for the second respondent, correctly submitted, s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (“the Act”) must be read as a whole. Nonetheless, as Campbell JA has set out the relevant portions of s 5 of the Act, it is convenient to reproduce here only s 5(1)(b):

“Where damage is suffered by any person as a result of a tort …

the sums recoverable under the judgments given in those actions by way of damages

the amount of the damages awarded by the judgment first given

245 The issue before this Court is whether the primary Judge (Robison DCJ) erred in dismissing the proceedings brought by the appellant against the respondents (“second proceedings”) under Uniform Civil Procedure Rules 2005 (“UCPR”) r 13.4(1). In the way the case was argued on the appeal, the correctness of his Honour’s decision depends on whether the appellant is precluded by s 5(1)(b) of the Act from enforcing any judgment for damages she might obtain in the second proceedings by reason of the consent judgment obtained in earlier proceedings brought by her against the State of New South Wales (“first proceedings”).

246 The respondents’ position is that the appellant is precluded from enforcing any such judgment because s 5(1)(b) prevents her from recovering in the second proceedings more than the amount of damages awarded to her by the consent judgment in the first proceedings. According to the respondents, the consent judgment compromised the appellant’s claim against the State for damages for personal injuries, including the injuries to her left shoulder occasioned by negligent treatment (for which the State was said to be responsible) and the second proceedings have been brought in respect of the same damage as the first proceedings. It follows, so they argue, that the terms of s 5(1)(b) are satisfied. Since the consent judgment against the State has been satisfied in full and since the appellant can recover no further damages under a second judgment, the second proceedings are futile and constitute an abuse of process.

247 The appellant accepts that she must give credit, when enforcing any judgment she obtains in the second proceedings, for damages already received by her in respect of the injuries to her left shoulder. She also accepts that it is a question of fact as to what portion of the consent judgment entered against the State (for $220,000 inclusive of costs) represents damages for injuries to her left shoulder. However, she contends that she is not precluded by s 5(1)(b) of the Act from recovering under any judgment obtained in the second proceedings.

248 The appellant says that this is so for three reasons. First, s 5(1)(b) applies only where the first judgment is given by a court after a full hearing or after a judicial assessment of damages. Secondly, the proceedings against the respondents are not in respect of the same “damage” as the proceedings brought by the appellant against the State, because the heads of damage available in an action against the State are more limited than those available in an action against the respondents. Thirdly, s 5(1)(b) does not apply where, as here, the first proceedings are settled on the basis that the claimant (the appellant) reserves the right to proceed against other joint or concurrent tortfeasors.

249 I propose to deal only with the appellant’s first argument.

250 The appellant’s written submissions concentrated on the phrase “judgment first given” in s 5(1)(b). The appellant argued that the phrase should be construed to refer only to judgment given by a court after a full hearing or after a judicial assessment of damages. This interpretation was said to be in conformity with the “policy of the law” stated by Kirby J in his concurring judgment in Baxter v Obacelo Pty Ltd [2001] HCA 66; 205 CLR 635, at 664-665 [75]:

“Unless the Act clearly obliges a different conclusion or unless a clear principle of the common law or of equity mandates the opposite result, it is ordinarily desirable that parties should be able to settle severally, as between each other, the issues they have brought to court for resolution according to law. Any inhibition upon that attribute of personal and economic freedom has to be clearly justified and based on statutory language or legal authority that is certainly applicable”.

251 In the course of oral argument, the textual focus of the appellant’s arguments changed. Ms Norton SC, who appeared with Ms Causer for the appellant, placed emphasis on the expression “the damages awarded by the judgment first given”. She submitted that, whatever meaning might be attributed to the phrase “judgment first given”, the reference to “damages awarded by the judgment” indicate that the upper limit of recovery under s 5(1)(b) (assuming that all elements of the provision are satisfied) is the quantum of damages in respect of injuries sustained by the plaintiff awarded by a court after a hearing on the merits.

252 Section 5 of the Act reproduces the language of s 6 of the curiously entitled Law Reform (Married Women and Tortfeasors) Act 1935 (UK) (“1935 Act”). The 1935 Act broadly followed the recommendations of the Law Revision Committee in its Third Interim Report (Cmd. 4637, 1934). That Report was primarily concerned with abolishing the “doctrine of no contribution between tort-feasors”. It addressed (at [11]) only very briefly an important consequential issue raised by the abolition of the doctrine, namely whether a plaintiff should be restricted to “obtain[ing] by execution, in the aggregate, more than the amount awarded in the first judgment”. The recommendation (Rec I) was framed in terms of a proviso to the principal recommendation:

the amount of the first judgment obtained

253 The United Kingdom Parliament did not follow precisely the language used by the Law Revision Committee in the legislation implementing the Committee’s recommendations. The drafting of the legislation has often been criticised, both in Australia and the United Kingdom. The language of s 5(1)(a) of the Act was described by Gibbs CJ in XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; 155 CLR 448, at 458 [14], as “elliptical and somewhat obscure”, a description that echoed the comment of Lord Diplock in Bryanston Finance Ltd v de Vries [1975] QB 703, at 731 (“highly elliptical”). Kirby J in Baxter (at 663 [72]) cited the pointed observation of the High Court in Bitumen and Oil Refineries (Australia) Ltd v Commissioner for Government Transport [1955] HCA 1; 92 CLR 200, at 211 [12], that s 5(1) is “a piece of law reform which seems itself to call somewhat urgently for reform”. Kirby J himself characterised (at 667 [84]) the language of s 5 as “opaque”.

254 In the United Kingdom, the 1935 Act has indeed been reformed. In 1977, the Law Commission recommended removal of the limit set by s 6(1)(b) of the 1935 Act on the sum recoverable in successive actions, but proposed the retention and extension of the special provision relating to costs: Law of Contract: Report on Contribution (Law Com. No 79, 1977), at [41]. The Law Commission pointed out (at [37]) that s 6(1)(b) contained two deterrents against separate or successive proceedings against tortfeasors: first, the limitation on the sum recoverable by execution from tortfeasors in subsequent proceedings and, secondly, the special costs provision.

255 The Commission considered (at [40]) that the first sanction could lead to injustice:

“The amount of damages recoverable from one tortfeasor may be limited and the amount recoverable from another may not. The plaintiff may have good reasons for suing them in different actions and may have to sue the one with the limited liability first. In such circumstances it would seem odd that the tortfeasor with unlimited liability should benefit from the fact that judgment was first obtained against the one whose liability was limited. Such a result would, in our view, cause unjustifiable hardship to the plaintiff”. (Footnote omitted.)

“whether the sanction as to damages contained in section 6(1)(b) of the 1935 Act can be justified today. One of the main reasons for introducing it was that juries could not be relied on to assess damages in the same way. Whatever merit this argument may once have had has largely gone now that jury trial has ceased to be the normal method of trying civil actions. The other main reason for introducing section 6(1)(b) was to prevent multiplicity of proceedings but we think that this consideration is sufficiently covered by the special provision on costs, which we support and would like to see extended”.

256 The Law Commission’s recommendations were implemented by the Civil Liability (Contribution) Act 1978 (UK), which repealed s 6 of the 1935 Act and replaced it by provisions giving effect to the Law Commission’s proposals: see ss 3, 4, 9(2), Sch 2. Oddly enough, the New South Wales Parliament has not followed suit in the 32 years that have passed since the Law Commission’s Report.

257 Although it is often said that s 5(1)(b) of the Act and its UK predecessor were designed to discourage multiple proceedings against joint or concurrent tortfeasors, the provision does not prevent the institution of successive actions against such tortfeasors. It operates by limiting the recoverability of sums awarded under judgments: Baxter, at 651 [29], per Gleeson CJ and Callinan J (with whom Gummow and Hayne JJ agreed); cf Bracks v Smyth-Kirk [2009] NSWCA 401, at [111], per McColl JA (with whom Allsop P and Young JA agreed). As was pointed out in Bracks, s 5(1)(b) expressly contemplates that more than one action may be brought against joint or concurrent tortfeasors in respect of the same damage. Moreover, a second or subsequent action might be appropriate in particular circumstances, as where the first judgment debtor is impecunious and a second action is required to produce a judgment capable of being satisfied: Bracks, at [150]-[155].

258 The language by which s 5(1)(b) limits recoverability in the second or subsequent proceedings requires careful attention. The limitation is that the sums recoverable:

damages awarded by the judgment

259 The New Shorter Oxford English Dictionary defines the verb “award” to mean:

gen

that

to do

2. Decide judicially (a process); issue judicially (a document etc.)”.

award

“1. A judicial decision.

2. A payment, penalty, etc, appointed by a judicial decision”.

260 The Macquarie Dictionary (5^th ed) defines “award” as a verb as follows:

to

award prizes

2. to bestow by judicial decree; assign or appoint by deliberate judgement, as in arbitration”.

Award

“3. something awarded, as a medal or prize.

Law

a. the decision of arbitrators on points submitted to them.

b. a decision after consideration; a judicial sentence”.

261 It will be seen from the dictionary definitions that the language used in s 5(1)(b) of the Act is ambiguous. It can be read as limited to a judgment entered in favour of a plaintiff following an assessment by the court of the quantum of damages to which the plaintiff is entitled by reason of the injuries he or she has sustained through the defendant’s breach of duty. On the other hand, the statutory language is capable of being read more broadly, to include a consent judgment requiring the defendant to pay the plaintiff an agreed sum in settlement of his or her claim for damages in respect of personal injuries. There are other examples of legislation using “award” whether as a noun or verb, that may give rise to similar ambiguities: see for example Civil Liability Act 2002, Pt 2 (“Personal injury damages”); Supreme Court Act 1970, s 68 (“Lord Cairns Act”); Tanska v Transport Accident Commission [2000] VSC 56 (Warren J); Eccles v Taylor [1995] 2 VR 482 (Ashley J).

262 Statutory provisions must be construed having regard to the language used, interpreted in the context of the legislation read as a whole. Notwithstanding the ambiguity in s 5(1)(b) of the Act, in my view, the more natural interpretation of the statutory language is that the aggregate limit is to be ascertained by reference to the amount of damages awarded following a judicial assessment of the damages to be awarded to the plaintiff by reason of his or her injuries. This follows from the primary dictionary meaning of “award”, when used as a verb, as determining or deciding (a claim) after consideration or deliberation, or adjudicating that a claim is merited.

263 When s 5(1)(b) is read in context, this construction receives support. It can be accepted, as Mr Leopold argued, that the word “judgment” in s 5 must be given the same meaning throughout the section. It can also be accepted that, having regard to the object of s 5(1)(a) (that is, the abolition of the common law rule that a tort committed by joint tortfeasors merged in the judgment against one tortfeasor), “judgment” includes a consent judgment entered as the result of a settlement reached by the parties. But the question is what meaning should be attributed to the expression “the amount of the damages awarded by the judgment first given.”

264 Section 5(1)(b) uses the expression “under the judgments given in those actions”. It would have been a simple matter, had it been intended to set the limit of recoverability by reference to the amount of the first judgment, regardless of whether or not it followed a judicial assessment of damages, to make the intention clear. For example, the limit could have been expressed as “the amount of the judgment first given” or, perhaps, “the amount of the judgment first given by way of damages”. Alternatively, the formulation could have been that proposed by the Law Revision Committee, but not adopted by the drafter of the 1935 Act: “the amount of the first judgment obtained against any of the persons so liable”. That language would have made it quite clear that the upper limit of recovery was determined by the amount of the first judgment, whether “obtained” by consent or in consequence of a judicial determination. The apparently deliberate departure from the language proposed by the Law Revision Committee is, in my view, significant.

265 The construction I prefer fits comfortably with the principles explained by the High Court in Baxter. Where a court assesses damages in the first action, the plaintiff is precluded by s 5(1)(b) from recovering under a judgment in the second action more than the amount of damages awarded by the court in respect of the relevant “damage”. In such a case, the court in the first action will have given reasons for its assessment of damages. Accordingly, there will ordinarily be no difficulty in ascertaining “the amount of the damages awarded by the judgment first given”.

266 On this construction, s 5(1)(b) does not apply where the judgment first given has not involved a judicial assessment of damages. However, the plaintiff is prevented from obtaining double recovery of damages by the principles of recovery and satisfaction discussed in Baxter. The policy of encouraging settlement of the first proceedings is promoted without the plaintiff having the incentive of double recovery to pursue a second or subsequent proceeding. Moreover, this approach avoids the artificial distinction between a settlement implemented by a consent judgment in favour of the plaintiff and a settlement that operates inter partes, but does not result in a monetary judgment in the plaintiff’s favour.

267 Contrary to Mr Leopold’s argument, I do not think that this construction of s 5(1)(b) of the Act undercuts the policy of discouraging successive actions against joint or concurrent tortfeasors. First, as Bracks demonstrates, the policy is imperfectly implemented by the legislation in any event. Secondly, the sanction in costs provided by s 5(1)(b) remains as a disincentive to successive actions. Thirdly, the plaintiff is precluded from double recovery by the principles of recovery and satisfaction. Fourthly, a plaintiff who unreasonably pursues a second action against a joint or concurrent tortfeasor may well be met with an application to stay the proceedings on the principles stated in Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; 147 CLR 589.

268 Furthermore, construing s 5(1)(b) of the Act in the manner I suggest avoids much of the injustice that otherwise can be occasioned by the provision. As the Law Commission pointed out in 1977, the provision is capable of causing unjustifiable hardship where, for example, a plaintiff has good reasons for suing the tortfeasors in separate actions and institutes the first proceedings against a tortfeasor whose liability for the damage is more limited than the other joint or concurrent tortfeasors.

269 I therefore conclude that, on its proper construction, s 5(1)(b) of the Act does not apply to a consent judgment which provides for a tortfeasor to pay damages to a plaintiff in respect of the “damage” he or she sustained in consequence of the tort, where the consent judgment does not follow an assessment of damages by a court. It follows that leave to appeal should be granted and the appeal allowed.

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Citations

Nau v Kemp & Associates [2010] NSWCA 164

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Infa-Secure Pty Limited v Crocker [2015] FCA 830

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Anderson v Canaccord Genuity Financial Ltd (No 2) [2024] NSWCA 161

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54

Statutory Material Cited

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Baxter v Obacelo Pty Ltd [2001] HCA 66

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Cited Sections

CITATION:	Nau v Kemp & Associates [2010] NSWCA 164
HEARING DATE(S):	7 December 2009
JUDGMENT DATE:	12 July 2010
JUDGMENT OF:	McColl JA at 1; Campbell JA at 113; Sackville AJA at 243
DECISION:	(1) Grant leave to appeal (2) Direct a notice of appeal, in the form contained in the white book, be filed within seven days (3) Appeal allowed (4) Set aside the orders made in the District Court on 20 February 2009 in matter 4603 of 2005 (5) In lieu thereof, order that the Notice of Motion of each Respondent be dismissed with costs (6) Respondents to pay costs of the Appellant of the appeal, but to have a certificate under the Suitors Fund Act 1951 if qualified.
CATCHWORDS:	TORTS – the law of torts generally – joint or several tortfeasors – contribution – general – effect of settlement against one tortfeasor – legislation preventing double recovery – purpose and effect of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – undercompensation irrelevant for purposes of operation of s5(1)(b) – TORTS – the law of torts generally – general principles – meaning of “damages awarded” in s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946– “damages awarded” extends only to circumstances where the court has assessed the quantum of those damages in the context of s5(1)(b) – TORTS – negligence – apportionment of responsibility and damages – principles and mode of apportionment – DAMAGES – measure and remoteness of damages in actions for tort – measure of damages – legislation limiting amount of damages available – effect of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – PROCEDURE – judgments and orders – effect of judgments – whether “damages awarded” extends to include judgments giving effect to settlement amongst parties for the purposes of s5(1)(b) Law Reform (Miscellaneous Provisions) Act 1946 – meaning of “damage” – WORDS AND PHRASES – “damage” – “damages awarded”
LEGISLATION CITED:	Civil Liability (Contribution) Act 1978 (UK) Civil Liability Act 2002 Companies Act 1929 (19 & 20 Geo V c 23) District Court Act 1973 District Court Rules 1973 Insurance Contracts Act 1984 (Cth) Interpretation Act 1987 (NSW) Law Reform (Contributory Negligence and Tortfeasor's Contribution) Act 1947 (WA) Law Reform (Married Women and Tortfeasors) Act 1935 (UK) Law Reform (Miscellaneous Provisions) Act 1946 (NSW) Law Reform (Miscellaneous Provisions) Act 1955 (ACT) Law Reform (Miscellaneous Provisions) Act 1956 (NT) Law Reform (Miscellaneous Provisions) Act 1965 (NSW) Law Reform Act 1936 (NZ) Law Reform Act 1995 (Qld) Lord Cairns Act Rules of the Supreme Court, 1883 (Eng) Supreme Court Act 1970 Transport Accident Act 1986 (Vic) Uniform Civil Procedure Rules 2005 Workers Compensation Act 1987 (NSW) Workers Rehabilitation and Compensation Act 1986 (SA) Wrongs Act 1936 (SA) Wrongs Act 1985 (Vic)
CATEGORY:	Principal judgment
CASES CITED:	Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 Alexander v Perpetual Trustees WA Pty Ltd [2004] HCA 7; (2004) 216 CLR 109 Ayling v BHP Direct Reduced Iron Pty Ltd [2001] WADC 252; (2001) 27 SR (WA) 274 Baker v Hallett [2004] QSC 132 Bakker v Joppich (1980) 25 SASR 468 Ballina Shire Council v Volk (1989) 18 NSWLR 1 Banque Keyser Ullman SA v Skandia (UK) Insurance Co Ltd (No 2) [1988] 2 All ER 880 Barisic v Devenport [1978] 2 NSWLR 111 Baxter v Obacelo Pty Ltd (2000) 48 NSWLR 522 Baxter v Obacelo Pty Ltd [2001] HCA 66; (2001) 205 CLR 635 Baylis v Waugh [1962] NZLR 44 Belan v Casey [2003] NSWSC 159; (2003) 57 NSWLR 670 Bitumen and Oil Refineries (Australia) Ltd v Commissioner for Government Transport [1955] HCA 1; 92 CLR 200 Boncristiano v Lohmann [1998] 4 VR 82 Bracks v Smyth-Kirk [2009] NSWCA 401; (2009) 263 ALR 522 Bracks v Smyth-Kirk [2010] HCATrans 145 Brambles Constructions Pty Ltd v Helmers [1966] HCA 3; (1966) 114 CLR 213 Brinsmead v Harrison (1872) LR 7 CP 547 Bryanston Finance Ltd v de Vries [1975] QB 703 Chamberlain v Deputy Commissioner of Taxation (ACT) [1988] HCA 21; (1988) 164 CLR 502 CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384 Collector of Customs v Agfa Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389 Compania Sansinena de Carnes Congelads v Houlder Brothers & Co Ltd [1910] 2 KB 354 Dairy Containers Ltd v NZI Bank Ltd; Auditor-General [1995] 2 NZLR 30 Dillingham Constructions Pty Ltd v Steel Mains Pty Ltd (1975) 132 CLR 323 Eccles v Taylor [1995] 2 VR 482 Electrolux Home Products Pty Ltd v Australian Workers’ Union [2004] HCA 40; (2004) 221 CLR 309 Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; 230 CLR 89 Gedeon v Commissioner of the New South Wales Crime Commission [2008] HCA 43; (2008) 236 CLR 120 George Wimpey & Co Ltd v British Overseas Airways Corporation [1955] AC 169 Glynn v Challenge Recruitment Australia Pty Ltd [2006] NSWCA 203 Harvey v Phillips [1956] HCA 27; (1956) 95 CLR 235 Heaton v AXA Equity & Law Life Assurance Society plc [2002] UKHL 15; [2002] 2 AC 329 Hickson v Goodman Fielder Ltd [2009] HCA 11; (2009) 237 CLR 130 In the Marriage of Harris & Caladine [1991] HCA 9; (1991) 172 CLR 84 Isaacs v Ocean Accident & Guarantee Corporation Ltd (1958) 58 SR (NSW) 69 James Hardie & Co Pty Ltd v Seltsam Pty Ltd [1998] HCA 78; (1998) 196 CLR 53 Jameson v Central Electricity Generating Board [1998] QB 323 Jameson v Central Electricity Generating Board [2000] 1 AC 455 John Holland (Constructions) Pty Ltd v Jordin (1985) 36 NTR 1 King v Hoare (1844) 13 M & W 494; 153 ER 206 Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; (1985) 156 CLR 522 Merryweather v Nixan (1799) 8 TR 186; 101 ER 1337 Mitsubishi Motors Australia Ltd v Harbord (1997) 69 SASR 75 Network Ten Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273 Paino v Hofbauer (1988) 13 NSWLR 193 Palmer v Wick and Pulteneytown Steam Shipping Co Ltd [1894] AC 318 Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; 147 CLR 589 Potter v Minahan [1908] HCA 63; (1908) 7 CLR 277 Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett [1945] HCA 50; (1945) 70 CLR 141 Ramsay v Pigram [1968] HCA 34; (1968) 118 CLR 271 Reichel v Magrath (1889) 14 App Cas 665 Residual Assco Group Limited v Spalvins [2000] HCA 33; (2000) 202 CLR 629 Ripper v Gatenby [2002] TASSC 45 Rippon v Chilcotin Pty Ltd [2001] NSWCA 142; (2001) 53 NSWLR 198 Rogers v The Queen (1994) 181 CLR 251 Sadler v The Great Western Railway Co [1896] AC 450 Saeed v Minister for Immigration and Citizenship [2010] HCA 23 SAS Trustee Corp v Budd [2005] NSWCA 366; (2005) 3 DDCR 382 Smurthwaite v Hannay [1894] AC 494 South Australia v Mountford [2001] SASC 85; (2001) 79 SASR 389 Spicer v Carmody (1948) 48 SR (NSW) 348 Spies v Commonwealth Bank of Australia (1991) 24 NSWLR 691 Stott v West Yorkshire Road Car Co Ltd [1971] 2 QB 651 Tanska v Transport Accident Commission [2000] VSC 56; (2000) 30 MVR 561 The Koursk [1924] P 140; (1924) Lloyd’s Rep 228 Thomas v State of New South Wales [2008] NSWCA 316; (2008) 74 NSWLR 34 Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; (1996) 186 CLR 574 Thomson Australian Holdings Pty Ltd v Trade Practices Commission [1981] HCA 48; (1981) 148 CLR 150 Unsworth v Commissioner For Railways (1958) 101 CLR 73 Wah Tat Bank Ltd v Chan [1975] AC 507 Walton v Gardiner (1993) 177 CLR 378 XL Petroleum (NSW) Pty Ltd v Caltex Oil (Australia) Pty Ltd [1985] HCA 12; (1985) 155 CLR 448
TEXTS CITED:	Fleming on Torts, 2nd ed (1961) Law Book Co Glanville Williams, Joint Torts and Contributory Negligence, (1951) Stevens & Sons Limited Latin Words & Phrases for Lawyers, Law and Business Publications (Canada) Inc 1980 Law Commission (Great Britain), Law of Contract: Report on Contribution, Law Com No 79 (1977) Law Revision Committee (Great Britain), Third Interim Report, Cmnd 4637 (1934) Law Revision Committee (Great Britain), Fourth Interim Report, Cmnd 4770 (1934) Salmond on Torts, 12th ed (1957) Sweet & Maxwell Spencer Bower and Handley, Res Judicata, 4th ed (2009) LexisNexis The Shorter Oxford English Dictionary on Historical Principles (3rd ed) United Kingdom, Parliamentary Debates, House of Commons, 8 July 1935, series 5, vol 304
PARTIES:	Cherrylle Nau (Appellant) Kemp & Associates Pty Ltd t/as Active Working Solutions (First Respondent) Amanda Tarn (Second Respondent)
FILE NUMBER(S):	CA 40151/09
COUNSEL:	S Norton SC; M Causer (Appellant) HJ Halligan (First Respondent) A Leopold SC; MS White (Second Respondent)
SOLICITORS:	Brydens Law Office (Appellant) Colin Biggers & Paisley (First Respondent) Lander & Rogers (Second Respondent)
LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	4603/05
LOWER COURT JUDICIAL OFFICER:	Robison DCJ
LOWER COURT DATE OF DECISION:	20 February 2009