Qantas Airways Limited v BMD Constructions Pty Limited - [2023] QSC 206

SUPREME COURT OF QUEENSLAND

CITATION:

Qantas Airways Limited & Anor v BMD Constructions Pty Limited [2023] QSC 206

PARTIES:

QANTAS AIRWAYS LIMITED
ACN 009 661 901

(first plaintiff)

JETSTAR AIRWAYS PTY LIMITED
ACN 069 720 243

(second plaintiff)

v
BMD CONSTRUCTIONS PTY LIMITED
ACN 010 126 100

(defendant)

FILE NO/S:

BS No 8964 of 2019

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court at Brisbane

DELIVERED ON:

8 September 2023

DELIVERED AT:

Brisbane

HEARING DATE:

13 March 2023

JUDGE:

Brown J

ORDER:

1.   Paragraphs 21G and 22D of the 2FASOC be struck out with liberty to replead.

2.   The defendant’s application is otherwise dismissed.

3.   If the parties cannot agree orders as to costs, they are to provide submissions by email to the Associate to Brown J for the question of costs to be determined on the papers within fourteen days.

4.    The parties are to provide directions as to the filing and serving of a further statement of claim, further amended defence and a reply to the Associate to Brown J within fourteen days to be decided on the papers unless her Honour requires the matter to be listed for further directions.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – PLEADINGS – STRIKING OUT – GENERALLY – where an aircraft used as part of the first plaintiff’s fleet was damaged – where the plaintiffs commenced proceedings in negligence against the defendant for loss and damage incurred in repairing the aircraft and general damages for the inability to use the aircraft until the completion of repairs – where the defendant applies to strike out amendments made in the plaintiffs’ second further amended statement of claim – where the application is made pursuant to rule 171(1)(a), (b) and (e) of the Uniform Civil Procedure Rules 1999 (Qld), on the basis that the pleaded case discloses no reasonable cause of action, has a tendency to prejudice or delay the fair trial of the proceeding or, alternatively, is an abuse of process of the Court – whether as a result of an internal restructure which occurred after the aircraft was damaged, the first plaintiff has lost its entitlement to claim damages arising out of the damage to the aircraft

Uniform Civil Procedure Rules 1999 (Qld)

Arsalan v Rixson (2021) 96 ALJR 1
BHP Coal Pty Ltd v O & K Orenstein & Koppel AG (2008) QSC 141
Butler v Egg and Egg Pulp Marketing Board (1966) 114 CLR 185
Candlewood Navigation Corporation Ltd v Mitsui OSK Lines Ltd (1985) 3 NSWLR 159
Director of War Service Homes v Harris [1968] Qd R 275
DMS Maritime Pty Ltd v Royal and Sun Alliance Insurance Plc [2018] QSC 303
Dodd Properties (Kent) Ltd v Canterbury City Council [1980] 1 WLR 433
Gagner Pty Ltd v Canturi Corporation Pty Ltd (2009) 262 ALR 691
G.U.S Property Management Ltd v Littlewoods Mail Order Stores Ltd [1982] SLT 533
Haines v Bendall (1991) 172 CLR 60
Insurance Australia Ltd v HIH Casualty & General Insurance…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] QSC 206
Decision Date: 8 September 2023

CaseChat Overview and Summary

In the matter of Qantas Airways Limited v BMD Constructions Pty Limited, the Court was tasked with addressing the dispute regarding the damages incurred by an aircraft leased by Qantas Airways Limited (QAL) and subsequently damaged by BMD Constructions Pty Ltd (BMD). BMD had caused damage to a leased Boeing aircraft during a construction project at Brisbane Airport, leading QAL to initiate proceedings against BMD for negligence. BMD responded by filing an application to strike out the amendments made in the second further amended statement of claim by QAL, asserting that the amended pleadings did not disclose a reasonable cause of action and would prejudice or delay the fair trial of the proceeding.

The court considered whether QAL had lost its entitlement to claim damages due to an internal restructuring that occurred after the aircraft was damaged. This restructuring saw the transfer of operational responsibilities for the Boeing 717-200 fleet, including the damaged aircraft, from QAL to Eastern Australia Airlines (EAA), a wholly owned subsidiary of QAL. The court needed to determine if the restructuring had any bearing on QAL's ability to pursue damages for the aircraft's damage. The court's reasoning focused on the terms of the sub-lease agreement between QAL and EAA, particularly clause 5.2, which included a waiver and general release of liability for QAL concerning the aircraft.

The Court ultimately decided that the amendments to the statement of claim should be struck out, with the exception of certain paragraphs, allowing QAL the opportunity to replead. The Court held that the restructuring did not automatically absolve QAL of its right to claim damages for the damage to the aircraft, as the restructuring did not explicitly exclude QAL from such claims. The Court dismissed the rest of BMD's application, leaving it to the parties to resolve any costs associated with the application and to provide further directions regarding the proceeding.

Orders

Orders of the court

1. Paragraphs 21G and 22D of the 2FASOC be struck out with liberty to replead.

2. The defendant’s application is otherwise dismissed.

3. If the parties cannot agree orders as to costs, they are to provide submissions by email to the Associate to Brown J for the question of costs to be determined on the papers within fourteen days.

4. The parties are to provide directions as to the filing and serving of a further statement of claim, further amended defence and a reply to the Associate to Brown J within fourteen days to be decided on the papers unless her Honour requires the matter to be listed for further directions.

Background

Background to the litigation

The question for this Court is whether there are questions of fact or law that merit a trial or not. The essential question is whether, as a result of an internal restructure which occurred after the aircraft was damaged, QAL has lost its entitlement to claim damages arising out of the damage to the aircraft in question. Background The first plaintiff, QAL, carries on business as an airline using wholly owned subsidiaries (Qantas Group), including EAA. QAL’s business is carried out using aircraft owned or leased by QAL. The defendant, BMD Constructions Pty Ltd (BMD), was engaged by Brisbane Airport Corporation Pty Limited to perform certain civil and industrial construction works at and about Brisbane Airport. In the course of performing those works, BMD caused a large poly plastic water tank to be placed in a construction storage area at Brisbane Airport. On 13 November 2016, during a thunderstorm at Brisbane Airport, the water tank was blown across the airfield and collided with and pushed a set of passenger stairs across the tarmac until ultimately the stairs and the water tank collided with a Boeing aircraft bearing Australian registration number VH-VQU. BMD admits that the aircraft sustained substantial damage on that date (the Damaged Aircraft). At the time of the incident, QAL leased the Damaged Aircraft from Boeing. Under the lease, QAL had the right to possession and use of the Damaged Aircraft. It also had legal responsibility for repairs to the Damaged Aircraft. On 18 October 2016, QAL entered into an agreement to purchase the Damaged Aircraft and became its owner on 24 January 2017. QAL undertook steps to repair the damage to the Damaged Aircraft, which remained out of service from 13 November 2016 until completion of repairs on 14 April 2017. At the time of the incident and subsequent repairs, the Qantas Group was engaged in implementing an internal restructure unrelated to the incident involving the Damaged Aircraft. The purpose of the restructure was said to be to maintain the business of the airline and ownership of its aircraft in QAL’s hands but to reassign operational responsibilities amongst its wholly owned subsidiaries. The restructure came into effect on 1 January 2017, with the effect that:(a)management of the Qantas Group’s Boeing 717-200 fleet was transferred from QAL to EAA pursuant to a master lease agreement dated 14 December 2016 (Lease Agreement);(b)EAA sub-leased the Damaged Aircraft from QAL pursuant to a sub-lease agreement dated 14 December 2016 (Sub-lease Agreement); and(c)EAA engaged National Jet Systems Pty Ltd (NJS) to operate the Boeing 717-200 fleet, including the Damaged Aircraft, pursuant to an operating agreement (EAA Operating Agreement). Significantly for the present application, the Sub-lease Agreement contained clause 5.2 which provided that:5.2Waiver and General Release in respect of the AircraftThe Aircraft, at Delivery, is delivered ‘as is, where is’ and Eastern unconditionally agrees and acknowledges that Qantas shall not be deemed to have made or given any covenants, warranties, conditions or representations express or implied as to, without limitation, the capacity, age, airworthiness, value, quality, durability, description, design, workmanship, materials, manufacture, construction, operation, state, merchantability, performance, fitness for any particular useful purpose or suitability of the aircraft … and Qantas shall not be liable for any loss, expenses, damages or claims … with respect to any of the matters set out in this clause 5.2 …”.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Qantas Airways Limited & Anor v BMD Constructions Pty Limited [2023] QSC 206
PARTIES:	QANTAS AIRWAYS LIMITED ACN 009 661 901 (first plaintiff) JETSTAR AIRWAYS PTY LIMITED ACN 069 720 243 (second plaintiff) v BMD CONSTRUCTIONS PTY LIMITED ACN 010 126 100 (defendant)
FILE NO/S:	BS No 8964 of 2019
DIVISION:	Trial
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court at Brisbane
DELIVERED ON:	8 September 2023
DELIVERED AT:	Brisbane
HEARING DATE:	13 March 2023
JUDGE:	Brown J
ORDER:	1. Paragraphs 21G and 22D of the 2FASOC be struck out with liberty to replead. 2. The defendant’s application is otherwise dismissed. 3. If the parties cannot agree orders as to costs, they are to provide submissions by email to the Associate to Brown J for the question of costs to be determined on the papers within fourteen days. 4. The parties are to provide directions as to the filing and serving of a further statement of claim, further amended defence and a reply to the Associate to Brown J within fourteen days to be decided on the papers unless her Honour requires the matter to be listed for further directions.
CATCHWORDS:	PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – PLEADINGS – STRIKING OUT – GENERALLY – where an aircraft used as part of the first plaintiff’s fleet was damaged – where the plaintiffs commenced proceedings in negligence against the defendant for loss and damage incurred in repairing the aircraft and general damages for the inability to use the aircraft until the completion of repairs – where the defendant applies to strike out amendments made in the plaintiffs’ second further amended statement of claim – where the application is made pursuant to rule 171(1)(a), (b) and (e) of the Uniform Civil Procedure Rules 1999 (Qld), on the basis that the pleaded case discloses no reasonable cause of action, has a tendency to prejudice or delay the fair trial of the proceeding or, alternatively, is an abuse of process of the Court – whether as a result of an internal restructure which occurred after the aircraft was damaged, the first plaintiff has lost its entitlement to claim damages arising out of the damage to the aircraft Uniform Civil Procedure Rules 1999 (Qld) Arsalan v Rixson (2021) 96 ALJR 1 BHP Coal Pty Ltd v O & K Orenstein & Koppel AG (2008) QSC 141 Butler v Egg and Egg Pulp Marketing Board (1966) 114 CLR 185 Candlewood Navigation Corporation Ltd v Mitsui OSK Lines Ltd (1985) 3 NSWLR 159 Director of War Service Homes v Harris [1968] Qd R 275 DMS Maritime Pty Ltd v Royal and Sun Alliance Insurance Plc [2018] QSC 303 Dodd Properties (Kent) Ltd v Canterbury City Council [1980] 1 WLR 433 Gagner Pty Ltd v Canturi Corporation Pty Ltd (2009) 262 ALR 691 G.U.S Property Management Ltd v Littlewoods Mail Order Stores Ltd [1982] SLT 533 Haines v Bendall (1991) 172 CLR 60 Insurance Australia Ltd v HIH Casualty & General Insurance…