| JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : SAIFEE by her next friend WASIMAH SAIFEE & ANOR -v- THE OWNERS OF KING GEORGE PLACE STRATA PLAN NO 2867 & ANOR [2003] WADC 89 CORAM : GROVES DCJ HEARD : 28 MARCH 2003 DELIVERED : Delivered Extemporaneously on 28 MARCH 2003 typed from tape and edited by Trial Judge FILE NO/S : CIV 1923 of 2000 BETWEEN : MARYAM SAIFEE by her next friend WASIMAH SAIFEE First Plaintiff
AND
WASIMAH SAIFEE
Second Plaintiff
AND
THE OWNERS OF KING GEORGE PLACE STRATA PLAN NO 2867
First Defendant
AND
DAVID ALEXANDER
Second Defendant
AND
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QBE HOLDINGS (AUSTRALIA) PTY LTD
Applicant
Catchwords: Practice - Western Australia - Practice under the Rules of the Supreme Court of Western Australia - Order 18, r 6 - Application of the insurer of the first defendant to be joined as a defendant to the action
Legislation: Nil
Result: Appeal dismissed Representation:
Counsel:
First Plaintiff : Ms R A van Heerwaarden
Second Plaintiff : Ms R A van Heerwaarden
First Defendant : No appearance
Second Defendant : No appearance
Applicant : Ms L G Rafferty
Solicitors:
First Plaintiff : Bradford & Co
Second Plaintiff : Bradford & Co
First Defendant : No appearance
Second Defendant : No appearance
Applicant : Greenland Brooksby
Case(s) referred to in judgment(s):
Nil
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Case(s) also cited:
Byrne & Anor v Brown [1889] 22 QBD 657
Dorrough & Anor v Bank of Melbourne Ltd (1995) 8 ANZ Insurance Cases 61-290
FAI General Insurance Company Ltd v Interchase Corporation Ltd & Ors (1999) 10 ANZ Insurance Cases 61-428
Forster v Jododex Australia Pty Ltd & Anor (1972) 127 CLR 421
Gurtner v Circuit & Anor [1968] 2 QB 587
Homestyle Pty Ltd v City of Belmont & Anor [1999] WASCA 59
In Re IG Farbenindustrie AG Agreement [1944] Ch 41
J N Taylor Holdings Ltd (In Liq) and J N Taylor Finance Pty Ltd (In Liq) v Alan Bond & Ors (1993) 59 SASR 432
Morrell v Mercantile Mutual Insurance (Australia) Ltd & Ors [1999] WASCA 250
News Limited & Ors v Australian Rugby Football League Limited & Ors (1996) 64 FCR 410
Pegang Mining Co Ltd v Choong Sam [1969] 2 MLJ 52
Qantas Airways Ltd v AF Little Pty Ltd [1981] 2 NSWLR 34
Robinson v The Western Australian Museum (1978) 138 CLR 283
Silktone Pty Ltd v Devreal Capital Pty Ltd and Ors (1990) 21 NSWLR 317
Trident General Insurance Co Ltd v McNiece Bros Proprietary Limited (1988) 165 CLR 107
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1 GROVES DCJ: The applicant is QBE Holdings Pty Ltd. It is not a party to the proceedings but made application by Chamber summons to be joined as third defendant to the proceedings. The application was heard by a Registrar of this Court who, on 20 December 2002 delivered brief oral reasons, indicating that he would not give leave for QBE to be joined as a defendant. He subsequently published reasons which were delivered on 31 January 2003. It is against that refusal that QBE appeals.
2 On 26 June 2000 the first plaintiff, an infant, and her mother, the second plaintiff, commenced proceedings against the first defendant, as owner and occupier of a block of units, and against the second defendant, as the agent of the first defendant and said to be responsible for the control and of management of the premises. The plaintiffs seek damages against the defendants for injuries sustained when the infant plaintiff fell from a stair landing to the ground below and sustained serious head injuries. 3 The incident is alleged to have occurred on 18 December 1998. At that time the infant plaintiff was 19 months of age. The infant is now 5 years of age. It will, given the seriousness of the injuries and the age of the infant, perhaps be many years before the child's final outcome will be known as to the consequences of those injuries and the child's prognosis for later life ascertained. 4 The claim is brought on the basis that each of the defendants breached its statutory duty under s 5 of the Occupiers Liability Act. Each of the defendants deny liability. In turn, the second defendant has raised a notice of contribution against the first defendant and pleads an agreement whereby it is said that the first defendant will indemnify the second defendant against all claims and proceedings which might be brought against the second defendant in respect of his management of the premises. 5 The second defendant also alleges negligence on the part of the first defendant and that, in turn, is denied by the first defendant just as it denies that it is liable to indemnify the second defendant. The applicant, QBE, is the insurer of the first defendant. Cover under its policy will indemnify the first defendant in the event that the first defendant is found to have been in breach of its duty under the Occupiers Liability Act. 6 However, the QBE policy excludes contractual liability. The consequence of that is that if the second defendant's claim for indemnity against the first defendant is successful, then QBE will not be called upon
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to indemnify the first defendant in respect of the contribution notice by the second defendant against the first defendant. 7 The first defendant is separately represented in these proceedings by solicitors as is the second defendant. 8 QBE, represented by other solicitors, claim to have an interest in the outcome of the proceedings by reason that there is the prospect if liability is found against the first defendant that it will be called upon to pay a substantial sum of money under the policy of insurance. 9 I have had the benefit of reading submissions which were prepared on behalf of QBE and provided to the Registrar on the hearing of the original application. Those submissions are comprehensive so far as the law and the authorities are concerned. Counsel on behalf of QBE has also assisted me in her submissions as to the effect of those authorities and the interest which QBE claims to have. 10 The interest, as I have identified, is that it may be liable to pay a large sum of money. It is a party who may be affected by the outcome of the proceedings and therefore, so it is claimed, should have the opportunity to be heard in the proceedings and participate in the proceedings so as to protect its interests insofar as moneys which it may have to pay. 11 I explored with counsel for QBE, in the course of her submissions to me, the future options, as it were, so far as the outcome of the proceedings are concerned. It seems to me that insofar as the concern which QBE has, that it has not been demonstrated, apart from reference to the authorities as to the interest, that in reality it has an interest which is not otherwise protected in the defence of the proceedings. 12 Furthermore it seemed to me that there is the potential that if QBE were joined as a defendant that it may itself have a conflict of interest, that situation arising in the context that it would be open to it to support the second defendant on the contractual indemnity argument against the first defendant, QBE's insured, which argument if successful would avoid the liability of QBE to indemnify the first defendant. 13 I indicate that that is a possibility. It is a prospect. That is not to say that in the end result that that would necessarily occur but it seems to me that therein lies a problem for QBE in that whilst protecting its interests it may act in a way which would be in conflict with and to the detriment of the interests of its insured.
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14 The further practical issue which occurred to me in the course of discussion with QBE's counsel is as to how the matter might proceed by way of pleadings and at trial if QBE were joined as a defendant. The fact is that the plaintiff has no interest in QBE and no claim against QBE and has no reason for QBE to be a party in the proceedings. As was indicated to me, the plaintiff objects to and opposes the application for joinder by QBE.
15 Developing that thought raises the question as to what issues there are, if any, in the proceedings which would be relevant so far as QBE's participation is concerned. I have not been able to discern any, as between QBE and the plaintiff and/or the first defendant and/or the second defendant which will not otherwise be protected by competent legal representation. 16 The interests of QBE so far as the first defendant is concerned - and I am told by counsel that to this stage there already has been a degree of cooperation as between their respective solicitors - will be protected by those solicitors on the record for the first defendant, both so far as defending the issue of liability and in defending the issue of quantum. 17 I am told that the extent of cover under the QBE policy is $5,000,000. Having regard to the severe injuries and age of the infant plaintiff, there is the possibility that an award of damages may well exceed that amount in which event the first defendant is uninsured for and will be liable for the amount above the level of cover. In those circumstances the first defendant has a very real interest insofar as defending the plaintiff's action is concerned. 18 Also it has a very real interest in defending the claim for indemnity which the second defendant has brought against it and in defending the claim of negligence which the second defendant has also brought against the first defendant on its pleadings. I say "a very real interest" because in the event that the second defendant succeeds on the indemnity argument, then the first defendant will be left without cover so far as that liability is concerned. The QBE policy excludes contractual liability and the first defendant would be left then to pay that amount. 19 I also raised with counsel in the course of our discussion the prospect that the matter might proceed by way of determination of the issue of liability at an early date and that at a later date, when the infant child's condition has stabilised, then quantum might be dealt with. It seems, given the nature of the proceedings, the age of the infant plaintiff and all
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matters relevant to the action, that it would be in all the parties interests that the issue of liability be brought to trial and be determined sooner rather than later. 20 In those circumstances, whilst QBE will not be required in the first instance to put its hand in its pocket if it is required to indemnify, and really its interest will be no less given the issues on liability, it nevertheless seems to me that if the matter were to proceed by way of trial on liability that the interests of QBE are adequately and sufficiently protected in that the first defendant is represented and it might be expected that its solicitors on the record and counsel will continue to cooperate and liaise with QBE so far as the defence of the action is concerned. No doubt QBE and its legal advisers could attend at trial and assist the first defendant's counsel from behind the bar table if that were deemed necessary. 21 In all of the circumstances, whilst it is within the Court's discretion in terms of O 18 of the Rules of the Supreme Court that there can be joinder of a party in these circumstances, and with respect to the authorities to which I was referred and to which comment must be made that each case will understandably be determined upon its own particular facts and circumstances, and in some respects the circumstances here are unique and distinguishable, I am not satisfied that there is any appropriate reason or need for QBE to be joined as a defendant. 22 I would say further that if it were to be joined there is the real risk that the plaintiff's action may become more complex because of matters as between the insurer and the other defendants and further expense will be incurred and perhaps delay might be involved in the plaintiff getting the matter to trial on liability and/or quantum. 23 For those reasons I will dismiss the appeal.
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