Seltsam Pty Ltd v Amaca Pty Limited
[2019] VSC 312
•14 May 2019
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
DUST DISEASES LIST
S CI 2018 01682
| JOHN RICHARD HORNE BENZIE | Plaintiff |
| v | |
| SELTSAM PTY LTD (FORMERLY WUNDERLICH LTD) | Second Defendant |
| AMACA PTY LIMITED (UNDER NSW ADMINISTERED WINDING UP) | Third Party |
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JUDGE: | John Dixon J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 27 March 2019 |
DATE OF JUDGMENT: | 14 May 2019 |
CASE MAY BE CITED AS: | Seltsam Pty Ltd v Amaca Pty Limited |
MEDIUM NEUTRAL CITATION: | [2019] VSC 312 |
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TORT – Contribution – Dust diseases – One tortfeasor compromised plaintiff’s claim including claim for pain and suffering, bodily or mental harm and loss of expectation of life – Plaintiff died – Tortfeasor who paid then sought contribution – Whether liability of tortfeasor to contribute limited by an enactment – Wrongs Act 1958 ss 23B, 24, Administration and Probate Act 1958 s 29.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | ||
| For the Second Defendant | Ms K Bradey | Colin Biggers & Paisley |
| For the Third Party | Mr J Ruskin QC with Mr R Stanley | Mills Oakley |
HIS HONOUR:
The issue I must determine is whether the second defendant (‘Seltsam’) is entitled to contribution and/or indemnity from the third party (‘Amaca’) in respect of any, and if so what amount, of $380,000 inclusive of costs and disbursements Seltsam paid to settle the claim made by the plaintiff John Benzie (‘Benzie’) against it and Seltsam’s costs of defending that claim.
In the principal proceeding Benzie alleged that he was exposed to asbestos between 1967 and 1979 when employed by Seltsam as a storeman, materials controller and manager. In particular, Benzie alleged that during his employment by Selstam he was exposed to asbestos in, and emanating from, Seltsam’s asbestos manufacturing factory in Mcintyre Road, Sunshine, and from asbestos waste at the rear of the factory.
Seltsam manufactured and supplied asbestos cement products at and from the factory until 31 July 1977 and Amaca manufactured and supplied asbestos cement products at and from the factory at relevant times on and from 1 August 1977.
On 7 May 2018, Benzie issued a generally endorsed writ naming Amaca, Seltsam, and two other parties as defendants claiming damages for personal injuries including mesothelioma suffered as a consequence of his exposure to asbestos dust, particles and fibres caused by the negligence of and breach of statutory duty by each of those defendants. Benzie never served the writ on Amaca. Having regard to his illness the proceeding was conducted with considerable haste.
Benzie’s statement of claim, when filed, named Seltsam as the only defendant and the court was informed when the matter was listed for an expedited trial that none of the other defendants named in the writ had been served.
The proceeding was mediated on 7 June 2018 and formally settled when a deed of settlement and release was executed on 8 June 2018. The settlement sum was $380,000 inclusive of costs and disbursements. The deed only releases Benzie’s claim against Seltsam.
As at 8 June 2018, Seltsam had not given notice of any claim pursuant to rr 11.15 or 11.01 against any other party for contribution. On 10 June 2018, Benzie died from mesothelioma. These are the two crucial, and uncontested, facts that have shaped the legal contentions of Seltsam and Amaca.
On 27 July 2018, Seltsam issued this proceeding pursuant to s 23B of the Wrongs Act 1958 by third party notice against Amaca seeking contribution from Amaca in respect of Seltsam’s settlement payment to Benzie, contribution to Seltsam’s costs of defending Benzie’s action, and the costs of the third party proceeding.
On 30 July 2018, Benzie’s solicitors discontinued the primary proceeding against all defendants by notice.
Amaca made a number of admissions. It admitted that it owned and operated the factory from 1 August 1977 until November 1982 and that Benzie was exposed to asbestos dust and fibres from the factory from 1 August 1977. That exposure caused and/or materially contributed to Benzie’s mesothelioma, from which he died.
Amaca admitted that such exposure was in breach of its duty of care to Benzie and that it was liable in respect of the damage suffered by Benzie as a result of the dust and fibres emanating from the factory from 1 August 1977 during the period of his exposure thereafter.
The parties agreed that of the settlement, the general damages component was $297,500 and that the extent of Amaca’s obligation to contribute to Seltsam was 5%. Seltsam contended that Amaca was obligated to contribute $19,000 (5% of the total settlement sum). Amaca conceded no more than an obligation to contribute $4,125 (5% of $82,500, the non-general damages component of the settlement sum).
Amaca submitted that s 24(2A) of the Wrongs Act 1958 restricted contribution by reference to any limit imposed by any enactment so that as the contributing tortfeasor Amaca was not exposed to any greater liability than it would have faced had Benzie brought the action. The enactment imposing the relevant restriction or limitation was s 29 of the Administration and Probate Act 1958.
Section 23B(1) of the Wrongs Act provides the person liable (Seltsam) in respect of any damage suffered by another person (Benzie) may recover contribution from any other person (Amaca) liable in respect of the same damage. Section 23B(3) provides that Amaca is liable to make contribution notwithstanding that it ceased to be liable in respect of the damage in question since it occurred, unless it ceased to be liable because a limitation period expired or by reason of a prescription that extinguished Benzie’s right to claim against Amaca in respect of the damage.
Section 24(1) provides that, subject to sub-s (2A), the amount of the contribution recoverable from any person (Amaca) shall be such as may be found to be just and equitable having regard to the extent of that person’s responsibility for the damage. Section 24(2A) provides that where the amount of the damages which have or might have been awarded in respect of the damage in question would have been subject to any limit imposed by or under any enactment, the contributing party shall not by virtue of any contribution awarded under s 23B be required to pay in respect of the damage a greater amount than the amount of those damages as so limited or reduced.
Section 29 of the Administration and Probate Act 1958 provides that on the death of any person, all causes of action subsisting against or vested in him shall survive against or (as the case may be) for the benefit of his estate. Where a cause of action survives for the benefit of the estate of a deceased person, the damages recoverable for the benefit of the estate of that person shall not, except as provided in sub-s (2A), include any damages for his pain or suffering or for any bodily or mental harm suffered by him or for the curtailment of his expectation of life. I refer to such heads of damages in these reasons as ‘general damages’.
It was agreed that the general damages component of the settlement ($297,500) met that statutory description of damages that could not be recovered by a plaintiff’s estate subject to the exception.
The exception to this limitation, found in sub-s (2A), permitted the estate of the deceased person to recover such damages where –
(a)a cause of action survives under sub section (1) for the benefit of the estate of a deceased person; and
(b)the death of that person is from a dust related condition which has been caused by the act or omission which gives rise to the cause of action; and
(c)proceedings in respect of that cause of action were commenced by that person before his or her death and were pending at his or her death.
For the reasons that follow, I find that Seltsam is entitled to contribution to the extent of 5% from Amaca in respect of the full settlement sum of $380,000 and in respect of Seltsam’s costs of defending Benzie’s proceeding.
Amaca submitted that as the contribution proceeding by third party notice was brought after Benzie’s death, Seltsam sought relief that was not permitted by reason of s 29(2)(c)(ii), which barred recovery of general damages and limited the scope of the contribution proceeding to non‑general damages. It submitted that s 29 of the Administration and Probate Act can only apply to preserve a cause of action after the death of a plaintiff if that cause of action was vested in him before he died. The exception to the limitation was inapplicable.
The short answer to Amaca’s contention is that s 29 of the Administration and Probate Act does not impose any limit on the amount of the damages which might have been awarded in respect of the damage in question in an action brought in Victoria by or on behalf of Benzie against Amaca, which may enliven s 24(2A) of the Wrongs Act.
It is settled law that Seltsam’s statutory right to contribution under s 23B of the Wrongs Act from Amaca is a distinct cause of action apart from and independent of Benzie’s cause of action against Amaca.
In Brambles Construction Pty Ltd v Helmers (‘Brambles’)[1] a plaintiff had recovered judgment against his employer, Helmers, for damages in respect of injuries caused by Helmers’ negligence. During the course of the proceeding, Helmer served a third party notice on Brambles claiming contribution, pursuant to s 5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW). The proceeding against Helmers was issued within the relevant limitation period, which had expired when Helmers served his third party notice. Brambles contended that it was not liable to contribute to the plaintiff’s damages because the plaintiff’s claim against it was statute barred and he could not have obtained judgment against it.
[1](1966) 114 CLR 213.
The High Court held that the limitation defence was not available to Brambles in the contribution proceeding stating that the tortfeasor’s claim for contribution was a cause of action apart from and independent of the cause of action that the worker had or would have had against the tortfeasor from whom contribution was sought.[2]
[2]Ibid 218 (Barwick CJ).
Barwick CJ observed:
The effect of s. 5 (1) (c), in my opinion, is that a tort-feasor who has come under an enforceable obligation to pay money for the damage caused by his tortious act may successfully recover contribution from another tort-feasor who has also come under an obligation to pay money in respect of the same damage and he may also recover contribution from any other tort-feasor who, not having been sued by the injured party, had he been sued, would have been found to have caused or contributed to the same damage by a tortious act. It seems to me that there is no need whatever to specify any point of time as at which the expression ‘if sued’ should be applied. It can be read ‘if sued at any time’ which, of course, does not import any temporal element into the section.[3]
[3]Ibid 219.
Windeyer J observed, to like effect,
The description, a tort-feasor who if sued would have been liable, denotes any person who would have been held liable in tort had he been sued in a competent court, by proper process, at a proper time and on evidence properly presented - that is anyone whose liability as a tort-feasor could have been ascertained in an action. I see no reason for limiting the denotation of the description by assuming that the words ‘if sued’ refer to some particular point of time. It is enough that there was a time, before the liability of the defendant tort-feasor was actually ascertained, at which the plaintiff (the victim of the tort) could have successfully brought an action against some other person (the third party), either independently of or jointly with the defendant.[4]
[4]Ibid 221.
The concept central to s 23B is that the contributor be ‘liable in respect of the same damage (whether jointly with the first mentioned person or otherwise)’. As in the NSW legislation considered in Brambles, the Wrongs Act does not prescribe at what precise point in time the liability of the contributor to the plaintiff is determined. The reasoning in Brambles necessarily requires that there be a time before 8 June 2018 - when Seltsam’s precise liability to Benzie was actually ascertained - when Benzie could have successfully brought an action against Amaca, either independently of or jointly with Seltsam.
Amaca did not contest that it was liable in respect of Benzie’s damage from the time he suffered the damage until the date of his death, which included the time when Seltsam compromised Benzie’s claim to damages in respect of that damage.
The construction of s 5 of the NSW Act came before the High Court again in James Hardy and Coy Pty Limited v Seltsam Pty Ltd.[5] Discussing the statutory action for contribution, Gaudron and Gummow JJ observed:
Whilst the liability ascertained as between the plaintiff and the claimant tortfeasor is a condition precedent to the assertion by that tortfeasor of its statutory right to recover contribution, the amount of that liability so ascertained is not determinative of the amount recoverable on that statutory action from other tortfeasors. Further, the connection between the liability of the claimant tortfeasor to the tort victim and the standing of the claimant to bring the statutory action for contribution does not carry the consequence that the statutory action is subjected to the same limitation or other procedural regime imposed upon an action by the tort victim against the claimant tortfeasor.[6]
[5](1998) 196 CLR 53.
[6]Ibid 66 [28] (citation omitted).
On the admitted facts, Benzie had a cause of action against Amaca for general damages when he issued the writ naming Amaca as first defendant. It was not relevant that Benzie, as he was entitled to, pursued his cause of action against Seltsam to a full settlement. At that time, Amaca was liable to Benzie in respect of the same damage and it remained so liable when Seltsam’s statutory cause of action against Amaca pursuant to s 23B crystallised on 8 June 2018 on its entry into the deed of settlement and release with Benzie.
When Seltsam’s right to pursue contribution crystallised on the settlement of Benzie’s claim on 8 June 2018, Benzie could have successfully brought a proceeding against Amaca that was not or would not have been subject to any limit imposed by or under any enactment. Section 29 of the Administration and Probate Act was inapplicable.
At that time, Amaca was liable to Benzie in respect of the same damage,[7] and on its admissions in this proceeding, Benzie could have pursued that cause of action against Amaca to judgment or settlement of his full claim had he elected to pursue Amaca rather than Seltsam. The purpose of the statutory right to contribution between tortfeasors liable for the same damage is to ensure justice and equity between tortfeasors notwithstanding the choices of the injured victim of the tort. As Brambles established, no temporal element constrains the concept of liability for the same damage.
[7]Mahony v J Kruschich (Demolitions) Pty Ltd (1985) 156 CLR 522, 527.
On 8 June 2018, Amaca had not ceased to be liable to Benzie in respect of the general damages component of Benzie’s damage. Section 23B presumes the liability to contribute notwithstanding that a tortfeasor has ceased to be liable in respect of the damage in question since the time when the damage occurred, subject to two exceptions, but that section had no work to do unless Amaca had ceased to be liable.
Amaca contended that one of those exceptions became operative when Benzie died on 10 June 2019 and s 29 came into play, but this contention obfuscated the distinction made clear in Brambles between the claim for damages against a tortfeasor and the claim for contribution against a tortfeasor.
From 8 June 2018, the continuing claim under consideration was Seltsam’s statutory claim for contribution. At no point prior to that date could Amaca cease to be liable to contribute to general damages as a consequence of the plaintiff’s later death.
Amaca did not directly address this contention. Its submissions were based on s 29 of the Administrative and Probate Act. Amaca’s contentions did not distinguish the want of a claim by a proceeding from the existence of a right or a liability. It submitted that in the plaintiff’s lifetime there was no proceeding between any of the defendants for contribution. Specifically, Seltsam brought no contribution proceeding against Amaca in Benzie’s proceeding that would have allowed by reference to that cause of action, a determination whether and to what extent Seltsam could recover contribution against Amaca with respect to the general damages component of Benzie’s claim. The subject third party proceeding brought by Seltsam against Amaca was issued on 27 July 2018 after Benzie’s death and sought contribution from Amaca in respect of the general damages component (inter alia) of the settlement notwithstanding that at that time Benzie was deceased.
Amaca submitted that the issue was confined to identification of the ‘cause of action’ on which Seltsam sought contribution by the third party notice issued after Benzie’s death. It submitted that when the third party proceeding issued there was no claim for general damages that could be made on that cause of action because, under s 29A(2), a tortfeasor was only liable for general damages on a cause of action commenced in the lifetime of the deceased.
Amaca acknowledged that this contention could not be put had Seltsam sought contribution prior to Benzie’s death, but submitted that opportunity was not taken and, on the evidence, Benzie had no inclination to pursue Amaca on his claim. Amaca submitted that the conceptual basis for this contention was identified by analogy with the reasoning in Amaca Pty Ltd v Cremer (‘Cremer’).[8]
[8](2006) 66 NSWLR 400.
In Cremer, the victim of a tort in her lifetime commenced proceedings against three defendants. After her death, her executor sought leave to join Amaca as a fourth defendant. Section 2 of the Law Reform (Miscellaneous Provisions) Act 1944 is, for present purposes, in materially similar terms to s 29(1) and (2)(c)(ii) of the Administration and Probate Act. The exception found in s 29(2A) permitting recovery of what I have described as general damages in certain circumstances is found, in materially similar terms, in s 12B of the Dust Diseases Tribunal Act 1989 (NSW).
The Court of Appeal framed the issue as follows. A plaintiff dies after commencing proceedings in the Dust Diseases Tribunal to recover damages in respect of a dust related condition from which she is alleged to be suffering. Does s 2(2)(d) of the Miscellaneous Provisions Act preclude her estate from recovering damages in respect of her pain or suffering, her bodily or mental harm or for curtailment of her expectation of life, from a defendant joined as a party to the proceedings after her death? The Dust Diseases Tribunal held that it did not because s 12B of the Dust Diseases Tribunal Act, provides that s 2(2)(d) does not apply in relation to proceedings commenced by a person before her death and pending before the Dust Diseases Tribunal at the date of her death.
By majority,[9] the Court of Appeal held s 12B did not apply to the proceedings against Amaca and, accordingly, Mrs Cremer’s estate was precluded from recovering s 2(2)(d) damages from it. Amaca submitted that had a separate action been brought against it after Mrs Cremer’s death, there would have been no question of s 12B applying. The procedural circumstance that the action against Amaca was able to be ‘”tacked” on to the actions against the other defendants should not be determinative of the parties’ substantive rights’.[10]
[9]McColl JA and Brereton J, Basten JA dissenting.
[10]Cremer (2006) 66 NSWLR 400, 405 [19] (McColl JA)
McColl JA regarded s 12B as beneficial or remedial in nature, which, if ambiguous, was to be construed so as to give the most complete remedy that was consistent with the actual language employed and to which its words were fairly open. I readily accept Amaca’s submission that s 29 is beneficial legislation designed to preserve the rights of seriously ill or dying plaintiffs so as not to deprive their estate just because they were unfortunate enough to have died prior to the completion of their case. So much is clear from the second reading speech of the amending bill introducing s 29(2A),[11] but it is a consequence of no relevance.
[11]Administration and Probate (Dust Diseases) Bill, Hansard, Legislative Assembly, 16 March 2000, 414.
Amaca invited me to note that although it was named as a defendant to the writ, it was never served and Benzie showed no realistic intention to proceed against Amaca. Accordingly, there was no reason to construe s 29 to fit a purpose (preserving Seltsam’s right to contribution) that was not intended. This submission was irrelevant to the issue raised before me and I need not pause to explain why it was misconceived.
To understand how Amaca reasons from Cremer, the exceptions to the limitations set out in s 29(A) should be recalled. They are set out above at [18]. Of the preconditions for the exception to operate only sub‑paragraph (c) was in contention. This is a requirement that proceedings in respect of that cause of action were commenced by that person before his or her death and were pending at his or her death. It is immediately apparent for reasons already stated that the cause of action contemplated by the section is Benzie’s distinct cause of action against Amaca.
In Cremer, the critical question for the Court of Appeal was ‘to what “proceedings” does s 12B speak’. McColl JA answered that s 12B applied to proceedings in relation to a cause of action for damages in respect of a dust related condition commenced against a particular defendant by the deceased and pending before the Tribunal at his or her death. That proceeding was not commenced until Amaca was added as a party, which on the facts before the court did not occur until after the victim had died.[12]
[12]See also Brereton J, Ibid 439 [183]-[184].
I gain no assistance from Cremer. The Court of Appeal was considering a materially different set of circumstances, there was no claim for contribution and the victim had not settled her claim against any tortfeasor. The court was not considering the distinct statutory cause of action for contribution. Cremer is distinguishable on its facts and is unhelpful in the present context. Amaca’s contentions, reasoned by analogy with Cremer, have not persuaded me to a different view from that I have already expressed.
I can see nothing in the policy and conceptual considerations surrounding either legislative response that bear upon the proper construction of either ss 23B and 24 of the Wrongs Act or s 29 of the Administration and Probate Act that would deprive Seltsam from its entitlement to contribution from Amaca as a person liable in respect of the same damages.
I will briefly note further submissions from the parties that I need not resolve.
Amaca accepted that it became liable for the same damage when the plaintiff was alive on and from the time when the plaintiff first suffered that damage. Its contention was that the particular prescription of s 29(2) abolished general damages, and consequently that damage did not exist anymore. Amaca benefited from Benzie’s death because it ceased to be liable for the same damage when the third party proceeding issued after Benzie’s claim for damages in respect of that damage was compromised.
Amaca contended that even if it could be argued that the proceeding on the relevant cause of action was commenced before Benzie’s death, it was not in the relevant sense ‘pending’, so as to engage s 29(2A) and thus enable recovery by Seltsam of contribution to the general damages component of the settlement payment from Amaca pursuant to the third party proceedings. Amaca contended that a proceeding would not be pending unless it was ‘underway and actively litigated’.
Seltsam’s submissions, which if pressed to determine the issue I would prefer, was that because Benzie had named Amaca as a defendant to its writ and that the proceeding had not been discontinued when the third party proceeding was issued, s 29(2A)(c) would be satisfied. There was a proceeding in respect of the relevant cause of action (Benzie’s claim against Amaca) commenced by Benzie before his death and pending at the date of his death. Were it necessary to consider the issue, I would accept Seltsam’s submission that the preconditions for the exception to the limitation on recovery of general damages set out in ss (2A) were satisfied.
I will declare that Seltsam is entitled to contribution in respect of its liability to the plaintiff to the extent of 5% of both the sum paid by it to the plaintiff ($380,000) and its costs of defending the plaintiff’s proceeding.
I invite counsel to submit a minute identifying the precise figures to be stated in the court’s judgment or otherwise giving effect to these reasons and I will hear the parties on the question of costs.
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