Read v Comcare

[2020] NSWDDT 6

Dust Diseases Tribunal

New South Wales

Medium Neutral Citation:

Read v Comcare [2020] NSWDDT 6

Hearing dates:

28 April, 19 June 2020

Date of orders:

16 July 2020

Decision date:

16 July 2020

Before:

Russell SC DCJ

Decision:

(1) Determine pursuant to Rule 28.2 of the Uniform Civil Procedure Rules 2005 that the second defendant Icon Water Limited is liable to the plaintiff in respect of the breaches of duty of care alleged by the plaintiff in the Second Further Amended Statement of Claim filed on 5 November 2019.

(2)   Order the second defendant to pay the costs of the plaintiff and the costs of the first defendant of the determination of the separate question.

Catchwords:

STATUTORY INTERPRETATION – whether there was a liability of the Commonwealth or a Commonwealth authority to the plaintiff when claim made – Asbestos Related Claims (Management of Commonwealth Liabilities) Act 2005 (Cth), ss 3, 5

STATUTORY INTERPRETATION – whether the ACT Electricity Authority was a Commonwealth authority – whether the ACT Electricity & Water Authority was a Commonwealth authority – Asbestos Related Claims (Management of Commonwealth Liabilities) Act 2005 (Cth), s 3

STATUTORY INTERPRETATION – whether potential or contingent liability of the Commonwealth or a Commonwealth authority was transferred – Australian Capital Territory Electricity Supply Act 1962 (Cth), ss 5, 6, 17, 18, 19, 20, 23, 35 – Electricity and Water Ordinance 1988 (ACT) ss 4, 5, 31, 84, 90 – Electricity and Water (Corporatisation) (Consequential Provisions) Act 1995 (ACT) s 4

Legislation Cited:

Acts Interpretation Act 1901 (Cth) s 2H

Acts Interpretation Amendment Act 2011 (Cth) Sch 3 cl 1

Asbestos Related Claims (Management of Commonwealth Liabilities) Act 2005 (Cth), ss 3, 5

Australian Capital Territory Electricity Supply Act 1962 (Cth), ss 5, 6, 17, 18, 19, 20, 23, 35

Electricity and Water (Corporatisation) (Consequential Provisions) Act 1995 (ACT) ss 2,4

Electricity and Water Ordinance 1988 (ACT) ss 4, 5, 31, 84, 90

Safety Rehabilitation and Compensation Act 1988 (Cth), s 4

Seat of Government (Administration) Act 1910 (Cth) s 12

Seat of Government Acceptance Act 1909 (Cth) s 5

Stevedoring Industry Act 1956 (Cth)

Stevedoring Industry Acts (Termination) Act 1977 (Cth), ss 14,15

Stevedoring Industry Finance Committee Act 1977 (Cth)

Uniform Civil Procedure Rules 2005 (NSW), r 28.2

Cases Cited:

Comcare v Heffernan [2011] FCAFC 131; (2011) 196 FCR 494

Crimmins v Stevedoring Industry Finance Committee [1999] HCA 59; (1999) 200 CLR 1

Walters v Babergh District Council (1983) 82 LGR 235

Texts Cited:

ACT Special Gazette No.S148 dated 28 June 1995

Commonwealth, Parliamentary Debates, House of Representatives, 24 May 2005, Second Reading Speech (Mr Dutton – Minister for Workforce Participation)

Commonwealth, Parliamentary Debates, Senate, 27 November 1962, Second Reading Speech, (Senator Wade – Minister for Health)

Explanatory Memorandum to the Abestos-related Claims (Management of Commonwealth Liabilities) Bill 2005

Category:

Procedural and other rulings

Parties:

Pauline Edith Read (Plaintiff)
Comcare (First Defendant)
Icon Water Limited (Second Defendant)

Representation:

Counsel:
Mr S. Tzouganatos (Plaintiff)
Mr T. Howe QC (First Defendant)
Ms M. Allars SC (Second Defendant)

Solicitors:
Turner Freeman (Plaintiff)
HWL Ebsworth (First Defendant)
King & Wood Mallesons (Second Defendant)

File Number(s):

DDT 2020/00163280 (formerly DDT 58/2019)

Judgment

Background

1. The late Mr Owen Read was employed as a refrigeration and air conditioning mechanic in the Australian Capital Territory (ACT) between 5 February 1960 and 25 February 2011. From the time he was first employed until about 1988 he was exposed to asbestos dust and fibre in the course of his employment. As a result of such exposure, Mr Read contracted the fatal disease of malignant pleural mesothelioma.

2. Mr Read died from mesothelioma and these proceedings have been continued by Ms Pauline Read as legal personal representative of the estate of the late Owen Read.

3. Mr Read commenced proceedings against Comcare as the sole defendant. The Statement of Claim has since been amended and the current iteration is the Second Further Amended Statement of Claim filed on 5 November 2019. It names Comcare as the first defendant and Icon Water Limited (Icon Water) as the second defendant. That pleading alleges that Mr Read was employed as follows:

1. Between 2 February 1960 and 30 June 1963 by the Canberra Electric Supply, Department of Interior, Commonwealth Government.

2. Between 1 July 1963 and 30 June 1988 by the ACT Electricity Authority (ACTEA).

3. Between 1 July 1988 and 30 May 1995 by the ACT Electricity & Water Authority (ACTEWA).

4. Between 30 May 1995 and 25 February 2011 by Icon Water (formerly ACTEW Corporation Limited).

4. The present pleading claims against Comcare pursuant to s 5 of the Asbestos Related Claims (Management of Commonwealth Liabilities) Act 2005 (Cth) (the ARC Act) on the basis that Comcare is liable for torts committed by the employers listed above.

5. In the alternative, the claim is made against Icon Water on the basis that Icon Water is liable for torts committed by the various employers listed above.

6. Comcare filed a Defence on 20 November 2019 which pleads that it is not liable to compensate the plaintiff for the torts committed by the employers.

7. Icon Water filed a Defence on 15 November 2019 which pleads that it is not liable for the torts of earlier employers, and that Comcare is the appropriate defendant, in accordance with the ARC Act.

Determination of separate question

8. Pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW) an order was made by consent of the parties for determination of a separate question. The proposed separate question was amended at the commencement of the hearing after discussion with the parties and with the consent of the parties.

9. The separate question for determination is:

“Whether the first defendant or the second defendant is liable to the plaintiff in respect of the breaches of duty of care alleged by the plaintiff in the Second Further Amended Statement of Claim.”

Pleaded breaches of duty of care

10. Paragraph 4 of the Second Further Amended Statement of Claim alleges that Mr Read was exposed to and inhaled asbestos dust and fibre from his first day of work on 2 February 1960 “until about 1988”.

11. The plaintiff’s Statement of Particulars was not put into evidence, but an affidavit of Mr Andersen solicitor dated 15 November 2019 referred to extracts from that document in relation to the period of exposure. The Statement of Particulars says that Mr Read was exposed to asbestos dust and fibre “well into the 1980s”. It also says that the exposure last occurred “some time in the late 1980s”.

12. This means that the breaches of duty of care pleaded in par 6A of the Second Further Amended Statement of Claim are alleged to have been committed by the first two employers (Canberra Electric Supply and ACTEA) but possibly also by the third employer (ACTEWA), because exposure to asbestos “until about 1988” could involve exposure in the second half of 1988 when ACTEWA was Mr Read’s employer.

13. Whether the appropriate defendant is Comcare or Icon Water first requires an examination of the ARC Act.

The ARC Act

14. The ARC Act commences as follows:

“An Act to assign responsibility for the management of certain liabilities relating to asbestos-related claims, and for related purposes.”

15. Section 3 of the ARC Act contains Definitions. Section 3 provides:

1. In this Act:

asbestos-related claim means a claim for the payment of compensation or damages to a person in respect of an asbestos related condition suffered by the person or another person arising from a breach of a common law or statutory duty of care by:

(a)   the Commonwealth; or

(b)   an entity that was a Commonwealth authority when the breach of the duty of care occurred.

asbestos­-related condition means:

(a)   asbestosis; or

(b)   an asbestos induced carcinoma; or

(c)   an asbestos-related non-malignant pleural disease; or

(d)   mesothelioma; or

(e)   any other condition that is caused by exposure to asbestos.

claim:

(a)   means a claim or demand of any kind (whether or not involving legal proceedings); and

(b)   includes proceedings of any kind.

Comcare means the body corporate established by section 68 of the Safety, Rehabilitation and Compensation Act 1988.

Commonwealth authority means:

(a)   a body corporate that is established for a public purpose by a law of the Commonwealth or of a Territory (other than the Australian Capital Territory, the Northern Territory or Norfolk Island) that is not a general law allowing incorporation as a company or body corporate; or

(b)   a body corporate that:

1. is incorporated under a law of the Commonwealth or of a State or Territory; and

2. is a body corporate in which the Commonwealth, or a body corporate covered by paragraph (a), has a controlling interest (within the meaning of the Safety, Rehabilitation and Compensation Act 1988); or

(c)   a body corporate that is declared to be a Commonwealth authority for the purposes of this Act under subsection 4(1);

but does not include:

(d)   Comcare; or

(e)   the Australian Postal Corporation; or

(f)   Telstra Corporation Limited; or

(g)   a body corporate that is declared not to be a Commonwealth authority for the purposes of this Act under subsection 4(2); or

(h)   a body corporate that is a subsidiary of a body corporate covered by paragraph (e), (f) or (g).

contract of insurance includes a contract which, however expressed and in whatever form, is in substance an indemnity or guarantee.

court (except in section 15) includes:

(a)   a tribunal; and

(b)   any judge or person acting judicially or authorised by law or consent of parties to hear, receive and examine evidence.

Finance Minister means the Minister who administers the Public Governance, Performance and Accountability Act 2013.

liability means a liability of any kind (whether actual, potential or contingent) but does not include a liability arising under:

(a)   a contract of insurance; or

(b)   a judgment or order of a court that is not stayed or subject to appeal when Part 2 of this Act commences; or

(c)   a settlement that takes the form of a written agreement entered into before Part 2 of this Act commences.

subject to appeal: a judgment or order is subject to appeal until:

(a)   any applicable time limits for lodging an appeal (however described) against the judgment or order have expired; and

(b)   if there is such an appeal against the judgment or order—the appeal (and any subsequent appeals) have been finally disposed of.

Meaning of subsidiary

1. For the purposes of this Act, the question whether a body corporate is a subsidiary of another body corporate is to be determined in the same manner as that question is determined under the Corporations Act 2001.”

   16. Part 2 of the ARC Act deals with “Transfer of Liabilities”. Section 5 deals with “Transfer of Liabilities to Comcare” and provides as follows:

“Claims against Commonwealth or authority on or before commencement

1. If an asbestos‑related claim was made against the Commonwealth or a Commonwealth authority on or before the commencement of this Part then, on the commencement of this Part:

(a)   a liability of the Commonwealth or the authority that relates to the claim ceases to be a liability of the Commonwealth or the authority and becomes a liability of Comcare; and

(b)   Comcare becomes the successor in law in relation to the liability.

Claims against Commonwealth or authority after commencement

1. If an asbestos‑related claim is made against the Commonwealth or a Commonwealth authority after the commencement of this Part then, at the time the claim is made:

(a)   a liability of the Commonwealth or the authority that relates to the claim ceases to be a liability of the Commonwealth or the authority and becomes a liability of Comcare; and

(b)   Comcare becomes the successor in law in relation to the liability.

Claims against Comcare on or after commencement

1. If, on or after the commencement of this Part, a person could make an asbestos‑related claim against the Commonwealth or a Commonwealth authority then:

(a)   the person may make the claim against Comcare; and

(b)   if the person makes the claim against Comcare—at the time the claim is made:

1. a liability of the Commonwealth or the authority that relates to the claim ceases to be a liability of the Commonwealth or the authority and becomes a liability of Comcare; and

2. Comcare becomes the successor in law in relation to the liability.”

   17. Part 2 of the ARC Act commenced on 26 October 2005.

   18. Section 5(1) of the ARC Act has no application to the present dispute. It applies when an asbestos-related claim was made against the Commonwealth or a Commonwealth authority on or before the commencement of Part 2 i.e. on or before 26 October 2005.

   19. Icon Water submitted that s 5(2) was the relevant provision. It submitted that when the Statement of Claim was filed in early 2019, Mr Read made a “claim” against the Commonwealth or a Commonwealth authority. The word “claim” is defined in s 3 of the ARC Act to include legal proceedings. Icon Water submitted that s 5(2) is engaged because an asbestos-related claim was made against the Commonwealth or a Commonwealth authority after the commencement of Part 2.

   20. Comcare submitted that s 5(3) and not s 5(2) was the relevant provision. However it disputed that Mr Read could make an asbestos-related claim against the Commonwealth or a Commonwealth authority when he developed mesothelioma. Comcare submitted that by that time Mr Read had no rights against the Commonwealth or a Commonwealth authority. It submitted that Mr Read’s rights were to bring his claim against Icon Water. Thus, it was said, s 5(3) was not enlivened so as to transfer any liability of the Commonwealth or a Commonwealth authority onto Comcare.

   21. During oral submissions on 19 June 2020 I asked both senior counsel whether it made any difference to the outcomes they were each seeking, if s 5(2) or s 5(3) applied. Both informed me that it did not matter.

   22. Section 5(2) of the ARC Act contains two concepts which require the determination of a state of affairs at a certain time:

   1. Firstly, the opening words of s 5(2) are that the sub-section only applies if an asbestos-related claim is made against the Commonwealth or a Commonwealth authority after 26 October 2005.

   2. Secondly, s 5(2) says that if such a claim has been made then, at the time the claim is made, a liability of the Commonwealth or a Commonwealth authority that relates to the claim ceases to be a liability of the Commonwealth or the authority and becomes a liability of Comcare. Comcare then becomes the successor in law in relation to the liability.

   23. Section 5(3) of the ARC Act contains two concepts which require the determination of a state of affairs at a certain time:

   1. Firstly, the opening words of s 5(3) are that the sub-section only applies if a person could make an asbestos-related claim against the Commonwealth or a Commonwealth authority after 26 October 2005.

   2. Secondly, s 5(3) says that if such a claim is made then, at the time the claim is made, a liability of the Commonwealth or a Commonwealth authority that relates to the claim ceases to be a liability of the Commonwealth or the authority and becomes a liability of Comcare. Comcare then becomes the successor in law in relation to the liability.

   24. The Tribunal must make findings whether there was, at the time the claim was made “a liability of the Commonwealth or the authority that relates to the claim”. This is the finding required whether s 5(2) or s 5(3) applies. Should it matter, I accept the submission of Icon Water that s 5(2) potentially applies, since the proceedings commenced in this Tribunal by Mr Read in 2019 fall within the definition of “claim” in s 3 of the ARC Act.

   25. I accept the submissions of both parties that it does not matter which provision applies. Both sub-sections operate at the time when the claim was made, to transfer liability from the Commonwealth or a Commonwealth authority to Comcare. Even on Comcare’s submission, the claim was made when the first Statement of Claim was filed in these proceedings i.e. on 20 February 2019.

Background to the ARC Act

26. The ARC Act implemented a recommendation made by an asbestos-related disease Inter-Departmental Committee established in 2002 to review the management of asbestos-related compensation claims against the Australian Government.

27. In the Second Reading Speech (Commonwealth, Parliamentary Debates, House of Representatives, 24 May 2005) Mr Dutton (Minister for Workforce Participation) said:

“The Asbestos-related Claims (Management of Commonwealth Liabilities) Bill 2005 will allow Comcare to manage all asbestos related claims brought at common law against the Government. It will achieve this by transferring the liability for such claims from the Commonwealth and Commonwealth authorities to Comcare.”

28. At the conclusion of the quite short Second Reading Speech, the Minister said:

“I present the Explanatory Memorandum to the Bill”.

29. The Explanatory Memorandum to the Abestos-related Claims (Management of Commonwealth Liabilities) Bill 2005, incorporated by the Minister into the Second Reading Speech, said of the definition of the word “liability” in cl 3 of the Bill:

“Liability means actual, contingent or potential liabilities. A liability can be incurred by the Commonwealth or a Commonwealth authority where there is a duty and this duty is breached resulting in damage. A liability can arise when damage is such that a cause of action has crystallised. A liability can also arise because the existence of a duty and its alleged breach has given rise to the foundation of a cause of action.”

30. The Explanatory Memorandum said the following in relation to cl 5 of the Bill:

“Clause 5 – Transfer of liabilities to Comcare

2.1   Subclause (1) applies to an asbestos-related claim made against the Commonwealth or a Commonwealth authority on or before this Bill commences. The effect of subclause (1) is that the making of the asbestos-related claim by a person would be the trigger for liability for that claim to transfer to Comcare. Comcare would become the successor in law to the Commonwealth or a Commonwealth authority for the liability relating to the claim, effectively becoming substituted for the Commonwealth or a Commonwealth authority in respect of the transferred liability. This would mean that Comcare would be in the position to ‘stand in the shoes’ of the Commonwealth or Commonwealth authority for all purposes relating to the claim. For example, Comcare would be substituted as the party to any proceedings underway and have the same rights as any defendant in proceedings including the right to join others, to sue third parties or to appeal judgments.

2.2   Subclause (2) applies to an asbestos-related claim made against the Commonwealth or a Commonwealth authority after the Bill commences. In this circumstance the effect of subclause (2) is that the making of the asbestos-related claim by a person would be the trigger for liability for that claim to transfer to Comcare. Again, Comcare would become the successor in law to the Commonwealth or a Commonwealth authority in relation to a claim relating to the liability.

2.3   The effect of subclause (3) is to allow a person with an asbestos-related claim against the Commonwealth or a Commonwealth authority after commencement to make the claim against Comcare.”

31. As set out in the Explanatory Memorandum, s 5(3) of the ARC Act gives a person with an asbestos-related claim against the Commonwealth or a Commonwealth authority the right to bring the claim directly against Comcare. Once the claim is brought, both s 5(2) and s 5(3) provide that the making of the claim is the moment when liability is transferred from the Commonwealth or a Commonwealth authority to Comcare.

32. For completeness, I record my view that prior to filing proceedings, Mr Read, if he had a claim arising out of the liability of the Commonwealth or a Commonwealth authority, was given a right to bring such a claim directly against Comcare. Further, when he did bring proceedings, if there was an existing liability of the Commonwealth or of a Commonwealth authority, that liability was transferred to Comcare. To adopt the words of the Explanatory Memorandum, once the claim was made, Comcare would stand in the shoes of the Commonwealth or Commonwealth authority for all purposes relating to the claim.

Non-Contentious Elements in Section 5 of the ARC Act

33. Section 5 of the ARC Act deals with an “asbestos-related claim” which is made by a person. The definition of “asbestos-related claim” in s 3(1) of the ARC Act contains several components.

34. Firstly, there must be a claim. In this case it is not contentious that there is a claim, as Mr Read brought legal proceedings, which are included in the definition of “claim” under s 3 of the ARC Act.

35. Secondly, the claim must be “for the payment of compensation or damages to a person”. The claim brought by Mr Read is a common law claim for damages, so this element is satisfied.

36. Thirdly, the claim for the payment of damages must be “in respect of an asbestos-related condition suffered by the person”. The phrase “asbestos-related condition” is defined to include the disease of mesothelioma. This is the disease for which Mr Read made his claim for damages, and thus this element is also satisfied.

37. Fourthly, the asbestos-related claim must be a claim arising from a breach of a common law or statutory duty of care by either:

1. the Commonwealth; or

2. an entity that was a Commonwealth authority when the breach of the duty of care occurred.

38. A reading of the Second Further Amended Statement of Claim filed on 5 November 2019 makes it plain that Mr Read’s proceedings are based upon breaches of both a common law duty of care and a statutory duty of care, committed by his employers between 2 February 1960 and 31 December 1988.

39. The question which then arises is whether the breaches of duty alleged against the employers were breaches of duty of care by the Commonwealth, or an entity that was a Commonwealth authority when the breach of duty of care occurred.

40. To deal with that issue, it is necessary to examine the legal structure and personality of each of the employers which Mr Read alleged had committed a breach of the duty of care owed to him.

Canberra Electric Supply

41. Prior to 1 July 1963, electricity was supplied in the ACT by an undertaking known as the Canberra Electric Supply, which was administered by the Department of the Interior of the Commonwealth Government (Ex 1, p 148).

42. Thus the employer of Mr Read between 2 February 1960 and 30 June 1963, when ACTEA came into existence, was the Commonwealth.

43. Any breach of duty of care by Mr Read’s employer in that period was a breach of a common law or statutory duty of care committed by the Commonwealth and for which it would be liable at common law.

ACTEA

44. The Parliament of Australia passed the Australian Capital Territory Electricity Supply Act 1962 (Cth), which came into force by proclamation on 1 July 1963 (the 1962 Act). Section 5(1) stated:

“There shall be an authority of the Commonwealth by the name of the Australian Capital Territory Electricity Authority”.

45. Section 5(2) provided that ACTEA was to be a body corporate which may sue and be sued in its corporate name. By s 6 ACTEA was to consist of a Chairman and two other members.

46. Section 17 of the 1962 Act provided:

“The functions of the Authority are –

(a)   to supply electricity in the Territory;

(b)   to promote the use of electricity in the Territory; and

(c)   such functions in relation to matters affecting or connected with the supply or use of electricity in the Territory as are conferred on the Authority by the laws of the Territory.”

47. Section 18(1) of the 1962 Act gave ACTEA the power to do all things necessary or convenient to be done in connection with or as incidental to the performance of its functions. This included purchasing, generating, transmitting and reticulating electricity in the ACT.

48. Section 19 of the 1962 Act gave ACTEA the power to fix or vary the charges for the supply of electricity.

49. By s 20(1) of the 1962 Act ACTEA could appoint officers and engage employees as it thought necessary for the purposes of the Act. By s 20(3) ACTEA could arrange for Commonwealth employees to be seconded it.

50. Part II Division 4 of the Act is headed “Finances of the Authority”. Section 23 of the 1962 Act occurred against a marginal note reading:

“Transfer to Authority of assets, and assumption by Authority of liabilities, of Canberra Electric Supply.”

51. Section 23 of the 1962 Act provided:

“23.—(1.)   Upon the commencement of this Act—

(a) the Minister may transfer or cause to be transferred to the Authority such of the assets owned by the Commonwealth and held or used in connexion with, or arising from the business of, the undertaking known as the Canberra Electric Supply as the Minister thinks fit; and

(b) the Authority is, by force of this section, liable to pay, satisfy, observe, perform and discharge the debts, liabilities and obligations of the Commonwealth in connexion with, or arising from the business of, that undertaking, other than debts, liabilities or obligations in relation to assets referred to in the last preceding paragraph that are not transferred in pursuance of that paragraph.

1. The Authority shall indemnify the Commonwealth, and keep the Commonwealth indemnified, from and against all actions, claims, demands, proceedings, suits, damages, expenses and costs that may be brought against, or incurred by, the Commonwealth at any time for or in respect of a debt, liability or obligation that the Authority is liable to pay, satisfy, observe, perform or discharge under paragraph (b) of the last preceding sub-section.

2. In this section, “assets” includes—

(a) plant, machinery, equipment, office furniture, fittings, motor vehicles and stock in trade;

(b) book and other debts due to the Commonwealth and the benefit of any securities for those debts;

(c) the benefit that is capable of assignment of any contract;

(d) all other property, rights or interests to which the Commonwealth is entitled and which it may assign; and

(e) all appropriate records maintained by the Commonwealth.”

52. Section 35 of the 1962 Act is one of the Transitional Provisions contained in Part III. Section 35 provides that agreements in respect of the supply of electricity by the Commonwealth in the ACT in force immediately before the commencement of the Act shall continue in force as if each agreement were an agreement with ACTEA in respect of the supply of electricity by ACTEA at the charges applicable under the 1962 Act, or at the charges agreed as special rates in any agreement.

53. It is clear from a reading of the 1962 Act in its entirety that the Commonwealth was ceasing to be involved in the supply of electricity in the ACT, and was setting up ACTEA as a corporation to carry on that supply. The new corporation ACTEA was to have all of the functions and powers necessary to enable it to carry on the activity of electricity supply in the ACT.

54. That this was the intent of the Commonwealth Parliament is confirmed by the Second Reading Speech (Senate, 27 November 1962, Senator Wade). The Second Reading Speech commenced:

“The purpose of this bill is to set up a statutory corporation charged with the responsibility for the supply of electricity in the Australian Capital Territory. The proposed corporation will take over the undertaking known as the Canberra Electricity Supply now administered by the Department of the Interior.”

55. The Second Reading Speech also said that until the constitution of ACTEA under the 1962 Act, the supply of electricity in the ACT had been carried on by departmental agencies, apart from the period from 1925 to 1930, during which it was a responsibility of the Federal Capital Commission.

56. The Speech said:

“The Government has therefore decided that the undertaking has reached the stage in its development when the constitution of a separate statutory authority is warranted. The proposed authority would be responsible for the purchase and generation of electricity and for its supply to consumers in the Territory. It would be completely self-contained having its own technical, administrative and financial structure, so that it can be operated as a modern public utility.”

57. The Speech concluded with the following reassurance to employees:

“In taking over the undertaking presently operated by the Canberra Electricity Supply the Authority will, of course, be taking over staff presently employed by the Department of the Interior. The rights of officers and employees who are involved in this transfer of staff will be protected. The act is to come into operation on a date to be fixed by proclamation. I commend the bill to the Senate.”

58. In the present proceedings Comcare submitted that the effect of s 23(1)(b) of the 1962 Act was that the plaintiff, even though employed by the Commonwealth of Australia between 1960 and 1963, could only bring a claim arising from a breach of duty during that period of employment against Icon Water, as the successor of ACTEA. By contrast, Icon Water submitted that the plaintiff’s claim relating to the period 1960 to 1963 was a claim which could only be brought against Comcare, pursuant to the ARC Act.

59. As previously recited, it is alleged that Mr Read was exposed to asbestos dust and fibre between 1963 and 1988, while he was in the employ of ACTEA.

60. Employment records for Mr Read (Ex 1, p 67) showed that he was employed by the Commonwealth Public Service from 2 February 1960 to 30 June 1963 and employed by ACTEA commencing on 1 July 1963.

61. Since ACTEA was a body corporate, which in law is a legal person, any breach of duty of care by Mr Read’s employer between 1 July 1963 and 30 June 1988 was a breach of a common law or statutory duty of care committed by ACTEA and for which it would be liable at common law.

ACTEWA

62. Section 12 of the Seat of Government (Administration) Act 1910 (Cth) gave a delegated legislative power to the Governor-General to make Ordinances for the peace, order and good government of the Australian Capital Territory, which then had force and effect in the ACT as the seat of government.

63. The Electricity and Water Ordinance 1988 (ACT) (the 1988 Ordinance), made by the Governor-General with the advice of the Federal Executive Council, established an authority by the name of the Australian Capital Territory Electricity and Water Authority.

64. Section 4(1) of the 1988 Ordinance provided for the establishment of an authority by the name of the Australian Capital Territory Electricity and Water Authority. By s 4(2) of the 1988 Ordinance, ACTEWA was a body corporate which could sue and be sued in its corporate name and style.

65. By s 5 of the 1988 Ordinance, the functions of ACTEWA were:

“(a)   To supply electricity and water;

(b)   To promote and manage the use of electricity and water;

(c)   To collect and treat sewage and otherwise to provide and manage sewerage services;

(d)   To produce sewage treatment by-products; and

(e)    To do such other things in relation to electricity or water or the provision of sewerage services as are conferred on the Authority by or under this Ordinance or any other law of the Territory.”

66. By s 31(1) of the 1988 Ordinance ACTEWA could appoint officers or engage employees.

67. ACTEWA was the employer of Mr Read between its commencement date of 1 July 1988 and 30 June 1995, when its functions were transferred to ACTEW Corporation Limited (later know as Icon Water).

68. Section 84 of the 1988 Ordinance dealt with the transfer of assets and liabilities and said:

“On the commencement date –

(a)   any rights, property or assets that, immediately before that date, were vested in the former Authority [i.e. ACTEA] are, by force of this section, vested in the Authority [i.e. ACTEWA];

(b)   the Authority becomes, by force of this section, liable to pay or discharge any debts, liabilities or obligations of the former Authority that existed immediately before that date…”

69. Section 90 of the 1988 Ordinance dealt with legal proceedings. Section 90(1) said:

“Where, before the commencement date, a cause of action by or against the former Authority [i.e. ACTEA] had arisen but proceedings in respect of that cause of action had not been instituted before that date, proceedings in respect of that cause of action may be instituted by or against the Authority [i.e. ACTEWA].”

70. There may or may not have been asbestos exposure when Mr Read was employed by ACTEWA. As recited above, the evidence about the last date of exposure to asbestos, and thus the last date on which an employer breached its duty of care to Mr Read, is imprecise. What can be said is that there was no exposure later than the end of 1988. Thus it is necessary to consider the liability of ACTEWA, if there was a breach of duty by ACTEWA in the second half of 1998 (but no later).

71. Any breach of duty of care by Mr Read’s employer ACTEWA between 1 July 1988 and 31 December 1988 was a breach of a common law or statutory duty of care committed by ACTEWA and for which it would be liable at common law.

ACTEW Corporation Limited/Icon Water

72. The Australian Capital Territory became self-governing on 11 May 1989.

73. The ACT Legislative Assembly passed the Electricity and Water (Corporatisation) (Consequential Provisions) Act 1995 (ACT) (the 1995 Act) to vest the rights and liabilities of ACTEWA in ACTEW Corporation Limited.

74. Section 4(1) of the 1995 Act said:

“Rights and liabilities of the Authority [ACTEWA] existing immediately before the relevant day [30 May 1995] shall, by force of this subsection, vest in the Company [ACTEW Corporation Limited] on the relevant day except to the extent that the Minister, before the relevant day, specifies under subsection (2) rights and liabilities of the Authority that vest in the Territory.”

75. Section 2(1) of the 1995 Act said that s 4 would “commence on a day on which this Act is notified in the Gazette”. Comcare submitted that the commencement date was 1 July 1995. Icon Water submitted that the commencement date was 30 May 1995, which was the date pleaded by the plaintiff. The ACT Special Gazette No.S148 dated 28 June 1995 gave notice that the 1995 Act had been passed by the ACT Legislative Assembly. I will adopt 28 June 1995 as the date of commencement of s 4. Whatever is the correct date, the outcome in this case is not affected.

76. ACTEW Corporation Limited later changed its name to Icon Water.

77. Mr Read had no asbestos exposure when he was employed by ACTEW Corporation Limited/Icon Water between 28 June 1995 and his retirement on 25 February 2011. There was thus no breach of duty of care by Mr Read’s employer ACTEW Corporation Limited/Icon Water.

Was there a common law liability of the Commonwealth or a Commonwealth authority when the claim was made?

78. As identified above a key issue for determination is whether, when Mr Read made his claim, there was at that time a liability of the Commonwealth or of a Commonwealth authority. If there was, then by force of s 5 of the ARC Act, such liability was transferred to Comcare, and it would be the proper defendant to Mr Read’s claim. If there was no such liability at that time, then there was nothing to transfer to Comcare.

79. An issue which arises upon the hearing of the separate question is whether s 23 of the 1962 Act operated to transfer the potential common law liability of the Commonwealth for any damage suffered by employees of the Commonwealth who were engaged in the business of the Canberra Electricity Supply. In other words, did the potential liability of the Commonwealth to Mr Read, for tortious exposure during the course of his employment by the Commonwealth before 1 July 1963, remain with the Commonwealth or was it transferred to ACTEA?

80. If the liability remained with the Commonwealth, then s 5 of the ARC Act will operate so that Comcare is the proper defendant to Mr Read’s claim arising from a breach of duty committed by his employer (the Commonwealth) in the period 1960 to 1963. One of the elements of the definition “asbestos-related claim” in s 3 of the ARC Act is that the asbestos-related condition is one “arising from a breach of a common law or statutory duty of care by…the Commonwealth”.

81. The same question must be asked and answered in relation both to the 1988 Ordinance and the 1995 Act. This is because one of the elements of the definition “asbestos-related claim” in s 3 of the ARC Act is that the asbestos-related condition is one “arising from a breach of a common law or statutory duty of care by…an entity that was a Commonwealth authority when the breach of duty of care occurred”. In turn that raises the question of whether ACTEA and/or ACTEWA were Commonwealth authorities within the meaning of the definition in s 3. Both entities were corporations created by legislation. Neither entity was the Commonwealth, but was either entity a Commonwealth authority when there was a breach of the duty of care owed to Mr Read?

82. Claims for damages for mesothelioma throw up unique problems. Some of those problems are caused by the time lag between tortious exposure and the development of mesothelioma. This latency period is usually around 40 years. If in the meantime liability for such tortious exposure has purportedly been transferred from one entity to another, the question arises as to which entity is liable for damages for breach of duty. Which entity should be sued by a person who has contracted mesothelioma?

Was ACTEA a Commonwealth authority if it breached its duty of care in the period 1963 to 1988?

83. The definition of “Commonwealth authority” in s 3(1) has been set out above. There are three species of body corporate, set out in pars (a), (b) and (c) of the definition, which can be a “Commonwealth authority” for the purposes of the ARC Act. There are exclusions for five kinds of Commonwealth authorities, set out in pars (d), (e), (f), (g) and (h) of the definition. None of those exclusions are relevant to the present case.

84. The question to be asked is whether ACTEA was a Commonwealth authority when the breach of duty of care occurred, if ACTEA did breach its duty of care to Mr Read and exposed him to asbestos which led to the development of mesothelioma.

85. Paragraph (a) of the definition says that “Commonwealth authority” means “a body corporate that is established for a public purpose by a law of the Commonwealth or of a Territory (other than the Australian Capital Territory, the Northern Territory or Norfolk Island) that is not a general law allowing incorporation as a company or body corporate”. The relevant elements of this definition are:

1. “a body corporate” – ACTEA was established by s 5(2) of the 1962 Act as a body corporate;

2. “that is established for a public purpose” – ACTEA was established for the obvious public purposes set out in s 17 of the 1962 Act concerning the supply of electricity in the ACT;

3. “by a law of the Commonwealth” – the 1962 Act is a law of the Commonwealth;

4. “that is not a general law allowing incorporation as a company or body corporate” – the 1962 Act is not a general law allowing incorporation of a company or a body corporate; it created one company only, and did so for a specific public purpose.

86. I conclude that ACTEA was a Commonwealth authority within the meaning of s 3 of the ARC Act, as it was a body corporate that is established for a public purpose by a law of the Commonwealth. Thus ACTEA was a Commonwealth authority when any breach of duty of care to Mr Read by ACTEA occurred.

87. That is not the end of the matter. My judgment below deals with the further issue of whether the potential or contingent liability of ACTEA was transferred elsewhere.

88. ACTEA does not fall within par (b) of the definition of “Commonwealth authority” which is “a body corporate that is incorporated under a law of the Commonwealth or of a State or Territory and is a body corporate in which the Commonwealth, or a body corporate covered by par (a), has a controlling interest (within the meaning of the Safety, Rehabilitation and Compensation Act 1988)”. While ACTEA was a body corporate incorporated under the law of the Commonwealth, it was not a body corporate in which the Commonwealth, or a body corporate covered by par (a) had a controlling interest, within the meaning of the Safety Rehabilitation and Compensation Act 1988 (Cth). Section 4 of that Act defines “controlling interest” as follows:

“‘controlling interest’ , in relation to a body corporate, means an interest in the body corporate that enables the person holding the interest to:

(a) control the composition of the board of directors of the body corporate; or

(b) cast, or control the casting of, more than one-half of the maximum number of votes that might be cast at a general meeting of the body corporate; or

(c) control more than one-half of the issued share capital of the body corporate (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital).”

89. There is no evidence that the Commonwealth had a “controlling interest” in ACTEA. Indeed the whole scheme of the 1962 Act was to enable the Commonwealth to transfer the responsibility for the supply of electricity in the ACT to the newly created authority ACTEA. There was no submission made that ACTEA was a Commonwealth authority within the meaning of par (b) of the definition.

90. ACTEA does not fall within the definition of “Commonwealth authority” in par (c). Paragraph (c) of the definition refers to a body corporate that is declared to be a Commonwealth authority for the purposes of the ARC Act, under s (4)(1) of the ARC Act. That sub-section provides that the Minister may, by written instrument, declare that a body corporate is a Commonwealth authority for the purposes of the ARC Act. There was no evidence that ACTEA had ever been declared by the Minister to be a Commonwealth authority for the purposes of the ARC Act, pursuant to s 4(1). There was no submission made that ACTEA was a Commonwealth authority within the meaning of par (c) of the definition.

91. My conclusion is that if ACTEA breached its duty of care to Mr Read during his employment between 1963 and 1988, ACTEA was a Commonwealth authority within the meaning of s 3 of the ARC Act, when the breach of duty of care occurred.

Was ACTEWA a Commonwealth authority if it breached its duty of care in the period 1 July 1988 to 31 December 1988?

92. The question to be asked is whether ACTEWA was a Commonwealth authority when the breach of duty of care occurred, if ACTEWA did breach its duty of care to Mr Read and exposed him to asbestos which led to the development of mesothelioma.

93. Paragraph (a) of the definition in s 3 of the ARC Act says that “Commonwealth authority” means “a body corporate that is established for a public purpose by a law of the Commonwealth or of a Territory (other than the Australian Capital Territory, the Northern Territory or Norfolk Island) that is not a general law allowing incorporation as a company or body corporate”. The relevant elements of this definition are:

1. “a body corporate” – ACTEWA was established by s 4(2) of the 1988 Ordinance as a body corporate;

2. “that is established for a public purpose” – ACTEWA was established for the obvious public purposes set out in s 5 of the 1988 Ordinance concerning the supply of electricity in the Australian Capital Territory;

3. “by a law of the Commonwealth – this element requires a separate discussion, which is set out below”;

4. or in the alternative to (3) above – “by a law of a Territory (other than the Australian Capital Territory, the Northern Territory or Norfolk Island)” – this element requires a separate discussion, which is set out below;

5. “that is not a general law allowing incorporation as a company or body corporate” – the 1988 Ordinance is not a general law allowing incorporation of a company or a body corporate; it created one company only and did so for a specific public purpose.

94. As discussed above, the 1988 Ordinance which established ACTEWA was not an Act of the Commonwealth Parliament, but was delegated legislation made pursuant to s 12 of the Seat of Government (Administration) Act 1910 (Cth), which gave a delegated legislative power to the Governor-General to make Ordinances for the peace, order and good government of the Australian Capital Territory.

95. Was the 1988 Ordinance a law of the Commonwealth? Section 2H of the Acts Interpretation Act 1901 (Cth) provides:

“In any Act, a reference to the law of the Commonwealth, or to a law of the Commonwealth, does not include, and is taken never to have included, a reference to a law in force in a Territory so far as the law is so in force because of an Act providing for the acceptance, administration or government of that Territory.”

96. Quite clearly the 1988 Ordinance was in force because of an Act providing for the acceptance, administration or government of the Australian Capital Territory. By s 5 of the Seat of Government Acceptance Act 1909 (Cth) the Territory was accepted by the Commonwealth and was acquired by the Commonwealth for the Seat of Government.

97. Section 2H was inserted in 2011, but has a retrospective effect – Acts Interpretation Amendment Act 2011 (Cth), Sch 3 cl 1.

98. Section 2(2) of the Acts Interpretation Act 1901 (Cth) provides:

“However, the application of this Act or a provision of this Act to an Act or a provision of an Act is subject to a contrary intention.”

99. I cannot discern any “contrary intention” in the words of the ARC Act. Any such contrary intention would have to be expressed in the ARC Act in clear terms – Comcare v Heffernan [2011] FCAFC 131; (2011) 196 FCR 494.

100. I conclude that the 1988 Ordinance was not a law of the Commonwealth, as it was in force in the ACT because of an Act providing for the acceptance, administration or government of the Australian Capital Territory.

101. Was the 1988 Ordinance a law of a Territory? Quite clearly it was not. The ACT was not self-governing in 1988. While a complex argument was put by senior counsel for Icon Water arising from self-government commencing in 1989, it must be remembered that the definition of “Commonwealth authority” under consideration refers to a body corporate that is established by a law of the Commonwealth or of a Territory. ACTEWA was established in 1988 by the 1988 Ordinance. Whatever be the status of that Ordinance after self-government in 1989, ACTEWA was established in 1988 by the 1988 Ordinance. As previously found, that Ordinance was not a law of the Commonwealth or a law of a Territory at the time of the establishment of ACTEWA.

102. My conclusion is that if ACTEWA breached its duty of care to Mr Read during his employment between 1 July 1988 and 31 December 1989, ACTEWA was not a Commonwealth authority within the meaning of s 3 of the ARC Act, when the breach of duty of care occurred.

Were any liabilities transferred by legislation?

103. Having made those findings, I turn to consider the arguments concerning whether, at the time when Mr Read filed his Statement of Claim on 20 February 2019, there was in existence any liability of the Commonwealth or a Commonwealth authority, which could be transferred to Comcare by force of s 5 of the ARC Act.

104. Comcare submitted that any liabilities had been transferred by legislation, and ultimately fell upon Icon Water. The submission for Icon Water was that such liabilities had not been transferred, and so Comcare was the proper defendant to Mr Read’s claim for damages.

The decision of the High Court in Crimmins

105. A most relevant case in the resolution of this issue is the decision of the High Court of Australia in Crimmins v Stevedoring Industry Finance Committee [1999] HCA 59; (1999) 200 CLR 1. Mr Crimmins was a waterside worker between April 1961 and November 1965 in the port of Melbourne. At that time stevedoring operations throughout Australia were regulated by the Australian Stevedoring Industry Authority (the Authority) which was established by the Stevedoring Industry Act 1956 (Cth). Pursuant to the provisions of the Stevedoring Industry Acts (Termination) Act 1977 (Cth) (the Termination Act) and the Stevedoring Industry Finance Committee Act 1977 (Cth), the Authority was abolished and was replaced by the Stevedoring Industry Finance Committee (the Committee). This occurred at the expiration of a “transitional period” fixed at 26 February 1978.

106. Section 14(b) of the Termination Act provided:

“The Committee is, by force of this section, liable to perform all the duties and to discharge all the liabilities and obligations of the Authority that existed immediately before the expiration of [the transitional] period.”

107. By the date of the expiration of the transitional period, the acts and omissions of the Authority said to constitute negligence had occurred, but no injury had been suffered and therefore no cause of action had arisen. In May 1997 Mr Crimmins was diagnosed as suffering from mesothelioma, which had been caused by the inhalation of asbestos fibres when he was employed by the Authority between 1961 and 1965.

108. The Committee argued that no “liability” had “existed” at the relevant time of transition on 26 February 1978.

109. Before embarking upon an analysis of the judgment, it is worth setting out again the provision in s 23(1)(b) of the 1962 Act for comparison with the provision in s 14(b) of the Termination Act. The provision in the 1962 Act, so far as it is relevant, is:

“… the Authority is, by force of this section, liable to pay, satisfy, observe, perform and discharge the debts, liabilities and obligations of the Commonwealth in connection with, or arising from the business of, that undertaking…”.

110. The provision in the Termination Act is:

“The Committee is, by force of this section, liable to perform all the duties and to discharge all the liabilities and obligations of the Authority that existed immediately before the expiration of [the transitional] period.”

111. While the two sections are not in the same terms, their similarities are obvious. Firstly, any liability imposed by both sections arises “by force of this section”. Secondly, both provisions make the new entity “liable” to “discharge” the “liabilities and obligations” of the Commonwealth in the case of ACTEA, and of the Authority in the case of the Committee.

112. In Crimmins Chief Justice Gleeson said at [8] that depending upon the context, the meaning of the word “liability” can include a contingent or potential liability. He noted that the Authority had been abolished and it had no further capacity itself to meet any claims upon it. His Honour held that there was “no good reason to distinguish between complete and inchoate causes of actions in cases where the Authority had committed a breach of a legal duty”. His Honour found that the evident purpose of the legislation was to preserve the just entitlements of those who had dealings with the Authority before its abolition. Chief Justice Gleeson agreed with the orders proposed by Justice McHugh.

113. Justice Gaudron held that the evident purpose of s 14(b) of the Termination Act was to ensure that persons who had a claim on the Authority in respect of unperformed duties and undischarged liabilities and obligations could, once the Authority had gone out of existence, look to the Committee for their performance and discharge – at [14]. Her Honour held that the word “existed” in s 14(b) was not synonymous with “were enforceable”. Her Honour said that there was no difficulty in speaking of the existence of a liability or obligation that is not presently enforceable – at [15].

114. Justice McHugh said that the question on the appeal was whether any liability of the statutory authority in tort to the worker was transmitted to the Authority’s successor body in circumstances where the liability could only be described as “contingent or potential” because the damage was suffered, and hence the tort was “complete”, only after the respondent had taken over the liabilities of the statutory authority. Justice McHugh said that resolution of this question turned on the construction of the statutory provisions governing the transmission of liabilities to the Committee – at [49].

115. Justice McHugh, like the other Justices in the case, held that the Committee was liable for the breach of duty committed by the Authority which resulted in the later development of mesothelioma. His Honour said at [142]:

“The context of the words ‘liabilities and obligations’ in s 14(b) suggests that they should be given the widest possible reading. That context includes the substitution of the respondent for the Authority as the controlling waterfront authority, the vesting of the Authority’s rights and property in the respondent, and the imposing of a liability on the respondent to perform the Authority’s duties. It makes it inherently likely that the words ‘liabilities and obligations… that existed immediately before’ were intended to make the respondent liable for discharging the consequences of any existing act or omission which could ground a legal action against the Authority. It would be surprising if the legislature intended that the liabilities of the respondent on the handover date were to be any less than those of the Authority if it had continued in existence. It seems mostly unlikely that the legislature could have intended to deprive people of rights that they would have had if the role of the Authority had not been taken over by the respondent.”

116. This paragraph illustrates some of the similarities, but also one of the differences, between Crimmins and the present case. In Crimmins, the Authority was going out of existence and would have had no capacity to meet a claim if sued. In the present case, the Commonwealth, which originally conducted the Canberra Electricity Supply, was not going out of existence and was still available to meet any claim made against it arising from a breach of duty to Mr Read committed in the years 1960 to 1963.

117. The similarities include:

1. The substitution of a new corporation to conduct a public activity previously being conducted by another body (supply of electricity in the ACT by the Commonwealth and stevedoring by the Authority);

2. The vesting of rights and property in the new entity;

3. The imposition of a liability on the new entity to carry out a public activity;

4. To provide for a seamless transmission to the new entity, in which all rights and property are vested in the new entity and all liabilities and obligations are transferred to the new entity.

118. Justice McHugh held that the better view was to regard s 14(b) as intended to make the Committee liable to anyone to whom the Authority would be liable if it had continued to exist. His Honour referred with approval to the judgment of Woolf J in Walters v Babergh District Council (1983) 82 LGR 235. That case involved liabilities taken over in a local government reorganisation. Justice Woolf found that the liabilities, which were taken over, extended to contingent and potential liabilities. His Lordship said:

“The whole tenor of the order is designed to ensure that the reorganisation would not affect events which would otherwise have occurred further than is absolutely necessary because of that reorganisation. That the public should be able to look to the new authority precisely in respect of those matters which it could look to the old authority; that the public’s position should be no better or no worse.”

119. Justice McHugh held that his Lordship’s comments were entirely applicable in Crimmins – at [146].

120. Justice McHugh said that given the evident object of s 14, he saw no reason for giving the words “liabilities and obligations” a narrow meaning. He said at [147]:

“The case would be different if the respondent was to be liable only for causes of action ‘that existed immediately before the expiration of that period’. But the legislature has chosen a more ambiguous term. That ambiguity should be resolved in a way that protects, rather than destroys, potential rights. It should therefore be given an interpretation which protects the rights which the plaintiff would have had against the Authority but for the legislative reorganisation of the industry.”

121. Justice Kirby was also attracted to the approach in the judgment in Walters v Babergh District Council – at [198].

122. Justice Hayne, with whom Justice Gummow agreed, expressed the view that the effect of s 14 was to provide for a seamless transmission from the Authority to the Committee in which all rights and property of the Authority were vested in the Committee and all liabilities and obligations of the Authority were transferred to the Committee – at [255]. Justice Hayne also referred to s 15 of the Termination Act which provided for substitution of the Committee for the Authority as a party to any contract or other instrument subsisting immediately before the expiration of the transitional period.

123. This is another similarity, as s 35 in the 1962 Act plays a similar role.

Consideration re transfer of Commonwealth liabilities to ACTEA

124. Senior Counsel for Icon Water drew attention to the wording of s 23(1)(b) of the 1962 Act which said that ACTEA was obliged to satisfy the liabilities and obligations of the Commonwealth, other than liabilities “in relation to assets referred to in the last preceding paragraph that are not transferred in pursuance of that paragraph”. Section 23(1)(a) of the 1962 Act said that the Minister may transfer to ACTEA such of the assets owned by the Commonwealth as the Minister thinks fit. The submission ran that the only liabilities transferred by s 23(1)(b) were any liabilities associated with assets which were transferred by the Minister.

125. Clearly the Commonwealth wanted to cease all involvement in the supply of electricity to Canberra. The entire scheme of the 1962 Act suggests that, as does the Second Reading Speech of Senator Wade, referred to above. The exclusion of liability in s 23(1)(b) in the 1962 Act can only sensibly be understood as an exclusion of liabilities associated with any assets not transferred to ACTEA. If for example a parcel of Commonwealth land had been reserved many years ago for a power station, but plans for that station had been abandoned, that parcel would not be transferred by the Minister to ACTEA. The effect of s 23(1)(b) in the 1962 Act is to make it plain that since ACTEA did not take a transfer of the land, ACTEA would not be taking on any liability associated with that land, such as an obligation to maintain or remediate the land. I reject the submission of Icon Water summarised above.

126. I conclude that the provisions of s 23(1)(b) in the 1962 Act are so similar in their structure, effect and intent to the provisions in the Termination Act considered in Crimmins that the same result should follow.

127. I find that the potential or contingent liability of the Commonwealth to Mr Read arising from any breach of duty by the Commonwealth during the employment of Mr Read in the business of the Canberra Electric Supply was a liability transferred from the Commonwealth to ACTEA on 1 July 1963 by force of the 1962 Act.

128. I further find that at the time when Mr Read made his claim in 2019 for the payment of damages in respect of mesothelioma arising from a breach of a common law or a statutory duty of care by the Commonwealth (such breach occurring in the period 1960 to 1963), any such liability had been transferred by the 1962 Act to ACTEA. There was in 2019 no liability of the Commonwealth in existence which could become a liability of Comcare pursuant to s 5 of the ARC Act.

Consideration re transfer of ACTEA liabilities to ACTEWA

129. If Mr Read was exposed to asbestos dust and fibre between 1 July 1963 and 30 June 1988, ACTEA had a potential or contingent liability to Mr Read, should he later develop mesothelioma, for the periods:

1. From 2 February 1960 to 30 June 1963, since the potential liability of the Commonwealth for breach of the Commonwealth’s duty of care to Mr Read had been transferred to ACTEA, as held above; and

2. From 1 July 1963 to 30 June 1988, since ACTEA was Mr Read’s direct employer in those 15 years.

130. As previously recited, s 84 of the 1988 Ordinance provided that ACTEWA became liable to pay or discharge any debts, liabilities or obligations of ACTEA. The terms of s 84 are almost identical to the transfer of liability provision considered in Crimmins. There was an additional similarity in that both ACTEA (in the present case) and the Australian Stevedoring Industry Authority (in Crimmins) were going out of existence, in the sense that all assets were being transferred and there would be no funds left from which any potential or contingent liability could be met, if damage was later suffered and a cause of action by a former employee became complete.

130. I conclude that the provisions of s 84 in the 1988 Ordinance are so similar in their structure, effect and intent to the provisions in the Termination Act considered in Crimmins that the same result should follow.

131. I find that the potential or contingent liability of ACTEA to Mr Read arising from any breach of duty by ACTEA during the employment of Mr Read was a liability transferred from ACTEA to ACTEWA on 1 July 1988 by force of the 1988 Ordinance.

132. The liability of ACTEA so transferred included the former liability of the Commonwealth for any 1960 to 1963 exposure, which I have already held was transferred by the 1962 Act to ACTEA.

133. I further find that at the time when Mr Read made his claim in 2019 for the payment of damages in respect of mesothelioma arising from a breach of a common law or a statutory duty of care by ACTEA (such breach occurring in the period 1963 to 1988), any such liability had already been transferred by the 1988 Ordinance to ACTEWA. There was in 2019 no liability of the Commonwealth or a Commonwealth authority in existence which could become a liability of Comcare pursuant to s 5 of the ARC Act.

Consideration re transfer of ACTEWA liabilities to Icon Water

135. By s 4(1) of the 1995 Act, liabilities of ACTEWA vested in ACTEW Corporation Limited. Thus ACTEW Corporation Limited (later renamed Icon Water) became liable in 1995 for the potential liabilities of ACTEWA to Mr Read. Such liabilities included ACTEWA’s potential liability for any breach of duty of care in the period 1 July 1988 to 31 December 1988, which pre-dated the creation of ACTEW Corporation Limited.

136. I find that the potential or contingent liability of ACTEWA to Mr Read arising from any breach of duty by ACTEWA during the employment of Mr Read between 1 July 1988 and 31 December 1988 was a liability transferred from ACTEWA to Icon Water by force of the 1995 Act.

137. The liability of ACTEWA so transferred included:

1. the former liability of the Commonwealth for any 1960 to 1963 exposure, which I have already held was transferred by the 1962 Act to ACTEA; and

2. the former liability of ACTEA for any 1963 to 1988 exposure, which I have already held was transferred by the 1988 Ordinance to ACTEWA.

138. I further find that at the time when Mr Read made his claim in 2019 for the payment of damages in respect of mesothelioma arising from a breach of a common law or a statutory duty of care there was no liability of ACTEWA in existence which could become a liability of Comcare pursuant to s 5 of the ARC Act because:

1. ACTEWA was not a Commonwealth authority as defined in the ARC Act.

2. Even if I am wrong in that regard, there was in 2019 no liability of a Commonwealth authority in existence which could become a liability of Comcare pursuant to s 5 of the ARC Act.

Conclusion

139. For the reasons set out above, there was at 20 February 2019 no liability of the Commonwealth or a Commonwealth authority in existence. While at common law the Commonwealth, ACTEA and ACTEWA all had a potential or contingent liability (if Mr Read later developed mesothelioma) for damages arising from their breaches of duty of care those liabilities were transferred to Icon Water in the manner discussed above.

140. It is not enough for a plaintiff has to merely assert or plead an asbestos-related claim against the Commonwealth after 26 October 2005. When the claim was made against Comcare in 2019, Mr Read would have had to demonstrate that the Commonwealth or a Commonwealth authority was then liable to him in damages. If the Commonwealth or a Commonwealth authority was liable at the time the claim was made, then the effect of the ARC Act would be that such liability would cease to be a liability of the Commonwealth or a Commonwealth authority and would be transferred to Comcare, giving Mr Read a right to sue Comcare. On the analysis above, there was in 2019 no liability of the Commonwealth or a Commonwealth authority to Mr Read and therefore there was no liability which could be transferred by force of s 5(2) or s 5(3) of the ARC Act to Comcare.

141. My conclusion is that the plaintiff has no claim which can be brought against Comcare. Liability for the plaintiff’s claim for damages rests with Icon Water.

142. My orders are:

1. Determine pursuant to Rule 28.2 of the Uniform Civil Procedure Rules 2005 that the second defendant Icon Water Limited is liable to the plaintiff in respect of the breaches of duty of care alleged by the plaintiff in the Second Further Amended Statement of Claim filed on 5 November 2019.

2. Order the second defendant to pay the costs of the plaintiff and the costs of the first defendant of the determination of the separate question.

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Decision last updated: 04 September 2020