(Re Verschuren) Amaca Pty Ltd v M and S Whelan Investments Pty Ltd

[2010] NSWDDT 2

Dust Diseases Tribunal

of New South Wales

CITATION:	(Re Verschuren) Amaca Pty Ltd v M & S Whelan Investments Pty Ltd [2010] NSWDDT 2
PARTIES:	Amaca Pty Ltd (Respondant Cross-Claimant) M & S Whelan Investments Pty Ltd (Applicant Cross-Defendant)
MATTER NUMBER(S):	107/2009/1
JUDGMENT OF:	O'Meally P
CATCHWORDS:	DUST DISEASES TRIBUNAL :- Cross-Claim by defendant - contribution determination - Cross-Defendant fails to comply with regulation - judgment entered on Cross-Claim in accordance with contribution determination - application to set aside or stay judgment - judgment stayed on terms
LEGISLATION CITED:	Dust Diseases Tribunal Regulation 2007 Dust Diseases (Standard Presumptions-Apportionment) Order 2007 Uniform Civil Proceedure Act 2005 Uniform Civil Proceedure Rules
CASES CITED:	QBE Insurance (Australia) Ltd v Wallaby Grip Ltd and Ors [2007] NSWCA 43
DATES OF HEARING:	16 February 2010
DATE OF JUDGMENT:	16 February 2010
EX TEMPORE JUDGMENT DATE:	16 February 2010
LEGAL REPRESENTATIVES:	S Shnider of Goldhirsch & Shnider appeared for the Applicant Cross-Defendant W S Strathdee instructed by DLA Phillips Fox appeared for the Defendant Cross-Claimant

JUDGMENT:

RULING

O'MEALLY P

1. This is an application by M & S Whelan Investments Pty Ltd (Whelan) to set aside the judgment entered on 14 December 2009 in a cross-claim in which Whelan was cross-defendant and Amaca Pty Ltd (Amaca) was cross-claimant.

2. In the principal proceedings, the plaintiff, Linda Patricia Verschuren, sued Amaca alleging that in the course of her employment by Whelan, she had been exposed to asbestos dust and fibre which emanated from products manufactured by Amaca’s predecessor.

3. Her claim became subject to the claims resolution process provided for by the Dust Diseases Tribunal Regulation 2007 (the Regulation).

4. On 28 August 2009, following service of the statement of claim and the plaintiff's particulars in accordance with the Regulation, Amaca issued its cross-claim against Whelan, seeking indemnity or contribution. The cross-claim was also subject to the claims resolution process.

5. Whelan declined to participate in the proceedings, though its solicitors did make contact with the mediator appointed pursuant to the Regulation. The mediation took place on 29 October 2009. Before that, that is to say on 13 October 2009, a contribution determination was made. The contributions assessor determined that Amaca was to bear 60 per cent of the plaintiff's damages, and Whelan 40 per cent. Contribution was determined in accordance with the Dust Diseases (Standard Presumptions–Apportionment) Order 2007.

6. The plaintiff’s particulars filed in accordance with the Regulation recited employment by Whelan at two locations in Victoria; The Davra Hotel at Mornington and The Man Lodge at Falls Creek. She said she was exposed to asbestos during the course of renovation work at The Man Lodge. Whelan’s stated reason for not participating was and is that it did not employ the plaintiff at The Man Lodge, and at The Davra Hotel no asbestos was used in building work, though the plaintiff did not say she was exposed to asbestos at The Davra Hotel.

7. Between the time the cross-claim was served on 8 September 2009 and the entry of judgment against Whelan on 14 December 2009, there had been repeated and regular contact between Whelan and the solicitors for Amaca. On many occasions, the solicitors for Amaca informed Whelan of the obligations which the Regulation imposed upon a party to proceedings in the Tribunal.

8. After the cross-claim was served, there was communication between Whelan and Amaca’s solicitors on 9 September 2009, 23 September 2009, 27 September 2009, 2 October 2009, 5 October 2009, 12 October 2009 and 14 October 2009. It was not until 19 October 2009 that Whelan instructed solicitors.

9. It was not until 27 October 2009 that Whelan’s solicitors contacted Amaca’s solicitors, saying that the wrong party had been sued and the contribution determination would be challenged.

10. Strange as it may seem to a casual observer, the provisions of the Regulation impose a liability to suffer judgment upon various parties to proceedings in the Tribunal, including, as in this case, a cross-defendant who disputes its liability, without there having been a hearing on the merits.

11. The Regulation confers a right to challenge the determination of a contributions assessor, but in accordance with the observations of Handley A JA in QBE Insurance (Australia) Ltd v Wallaby Grip Ltd & Ors [2007] NSWCA 43 at [36], “The Tribunal is entitled and bound to give effect to such a determination by entering appropriate verdicts and judgments”. Judgment was entered against Whelan on 14 December 2009 upon proof of service of all necessary documents.

12. On 22 December 2009, Whelan filed its notice of motion, seeking that judgment be set aside or, in the alternative, that it be stayed.

of the Uniform Civil Procedure Act 2005 provides:

Subject to rules of court, the court may at any time and from time to time, by order, stay any proceedings before it, either permanently or until a specified day.
Part 36 r 16 of the Uniform Civil Procedure Rules relevantly provides:
(2) The court may set aside or vary a judgment or order after it has been entered if:
(b) it has been given or made in the absence of a party, whether or not the absent party had notice of the relevant hearing or of the application for the judgment or order ...

(3A) If notice of motion for the setting aside or variation of a judgment or order is filed within 14 days after the judgment or order is entered, the court may determine the matter, and (if appropriate) set aside or vary the judgment or order under subrule (1), as if the judgment or order had not been entered.

14. The present situation is not of Amaca’s doing; it has been brought about by the inactivity of Whelan, and its failure to take the action required by the Regulation and the steps suggested to it by Amaca’s solicitors.

15. The affidavit material filed by Whelan on this application, and the statutory declarations filed by the plaintiff in the principal proceedings, demonstrate quite clearly that there are disputed questions of fact. These would need to be resolved in order to determine whether the assertion of Whelan that there was no exposure to asbestos at the times alleged by the plaintiff is correct. If what it says is correct, it would have no liability to Amaca.

16. On the basis of the plaintiff’s allegations in the statutory declaration forming part of the particulars, and in other material provided with those particulars, Amaca was justified in initiating the cross-claim against Whelan.

17. In my view, it is in the interests of justice that the disputed questions be resolved. There are triable issues of fact, and if the merits favour the cross-defendant, the contribution assessment will of necessity be varied. The judgment should be stayed until those issues have been determined, but because it was regularly obtained it should not be set aside.

18. Because the cross-defendant failed to do what it was obliged to do under the Regulation, it should, in my view, bear the costs of and incidental to this application.

19. During the course of discussions when the matter was before me on 22 December last, counsel for Whelan anticipated the possibility of his client’s being served with a winding-up petition, which he described as being “sudden death within 21 days”. I propose to make it a condition of the stay that the cross-defendant pay into Court the sum of $96,600. The plaintiff's action was settled by Amaca for $ 483,000. $96,600 represents half of 40 per cent of that sum, 40 per cent being the proportion allocated to Whelan by the contributions assessor.

20. On 21 December 2009, Amaca’s solicitors offered by email to consent to a stay if Whelan agreed to pay its costs on an indemnity basis from the date upon which it filed its motion seeking judgment. On the same day, through its solicitors, Whelan declined to do so. Whelan has not improved its position, and should pay costs on an indemnity basis.

21. The orders therefore are these:

Proceedings on the judgment of 14 December 2009 are stayed until further order of the Court upon terms that the cross-defendant within 28 days pay into Court the sum of $96,600.
The cross-defendant will pay the cross-claimant's costs of and incidental to this application on an indemnity basis.

22. The cross-defendant's notice of motion that the determination of the contributions assessor be varied by being reduced to nil is listed for hearing at 10.00am on 13 April 2010 at the County Court, Melbourne and 10.00am on 14, 15 and 16 April 2010 in Sydney.

23. Pursuant to S 13(7) of the Dust Diseases Tribunal Act 1989, I direct that part of the proceedings take place outside the State of New South Wales and in the State of Victoria.

S Shnider of Goldhirsch & Shnider appeared for the Applicant Cross-Defendant

W S Strathdee instructed by DLA Phillips Fox appeared for the Respondent Cross-Claimant