Switzerland Insurance Australia Ltd v Mowie Fisheries Pty Ltd

[1997] FCA 1588

JUDGMENT NQ. ........ ..... I s @ , .... ... ........

NOT FOR GENERAL DISTRIBUTION

NO ISSUE OF PRINCIPLE

IN THE FEDERAL COURT OF AUSTRALIA )

NEW SOUTH WALES DISTRICT REGISTRY ) No. NO 863 of 1996

GENERAL DIVISION )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

SWITZERLAND INSURANCE

AUSTRALIA LIMITED

Appellant

AND :

MOWIE FISHERIES PTY LIMITED

Respondent

CORAM : BEAUMONT? HILL? SACKVILLE JJ

PLACE: SYDNEY

DATE : 3 JUNE, 1997

MINUTES OF ORDER

THE COURT ORDERS THAT:

1. Order 4 ( b ) of the orders made on 10 April 1997, staying Order 2 made on that date, be discharged.

NOTE :

Settlement and entry of orders is dealt with in

Order 36 of the Federal Court Rules.

NOT FOR GENERAL DISTRIBUTION

NO ISSUE OF PRINCIPLE

IN THE FEDERAL COURT OF AUSTRALIA )

NEW SOUTH WALES DISTRICT REGISTRY ) NO. NG 863 of 1996

GENERAL DIVISION 1

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

SWITZERLAND INSURANCE

AUSTRALIA LIMITED

Appellant

AND :

MOWIE FISHERIES PTY LIMITED

Respondent

CORAM :	BEAUMONT, HILL, SACKVILLE JJ
PLACE :	SYDNEY
DATE:	3 JUNE, 1997

REASONS FOR JUDGMENT

Hill and Sackville JJ:

Judgment was delivered in this appeal on 10 April 1997. By majority (Hill and Sackville JJ, Beaumont J dissenting) the following orders were made:

1. The appeal be dismissed.

2. The appellant pay the respondent's costs of the appeal.

3. Order 2 be stayed for a period of 14 days.

4. Should either party file written submissions on costs

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within 14 days:

(a) the other party should file written submission in reply within a further 14 days from the filing of the first submissions; and

(b) Order 2 is stayed until further order.

The orders took this form in order to allow the parties, if they wished, to file submissions on costs.

The appellant filed written submissions seeking an order that each party bear its own costs of the appeal or, alternatively, that the appellant be ordered to pay only two thirds of the respondent's costs of the appeal. The respondent, for its part, contended that costs should be awarded in its favour on an indemnity basis or, alternatively, that costs simply follow the event.

The appellant supported its submissions on two grounds:

a

but for the holding that reg 402 of the Marine (Vessels) Regulations 1988 (Vic) (the "Victorian Marine Regulations") was invalid, the appellant would have succeeded on the appeal; and

S

the respondent failed on the issues raised by the notice

of contention.

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In our view, neither of these grounds warrants a departure from the usual rule that costs should follow the event. The validity of reg 402 of the Victorian Marine Regulations was raised before the primary Judge and on the appeal. While the majority judgment on the appeal did not accept the respondentls suggested construction of reg 402 (a construction adopted by the primary Judge), it was necessary to consider the correct construction of reg 402 before determining its validity. In any event, the construction question took very little time on the appeal.

Because of the conclusion reached by the majority, it was not necessary to address other arguments put on behalf of the respondent in relation to the Victorian Marine Regulations. However, it does not follow that the respondent would necessarily have failed on those issues (such as the definition of "propulsion power") or that it was unreasonable for the respondent to have raised the arguments. We do not think it was unreasonable for these issues to be raised.

The notice of contention challenged the primary Judge's rejection of the respondentls arguments on questions of waiver, breach of duty of good faith and materiality. The majority judgment did not address the issues raised by the notice of contention, because it was unnecessary to do so. It is true that Beaumont J concluded that the primary Judge had correctly rejected the respondent's arguments. However, this does not mean that the respondent failed on the issues raised

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by the notice of contention; the majority judgment simply did not deal with them. Nor can it be said that the notice of contention raised points that were not fairly arguable.

The respondent pointed out that the primary Judge ordered that the appellant pay costs from 1 July 1996 on an indemnity basis. His Honour made this order because of a "CaldebankM letter sent by the respondent to the appellant offering to compromise the proceedings. However, this does not justify an order that costs on the appeal be awarded to the respondent on an indemnity basis.

For these reasons we think that costs should follow the event. The only order that is necessary is that order 4(b) of the orders made on 10 April 1997, staying order 2 made on that date, be discharged.

I certify that this and the preceding 3

pages are a true copy of the Reasons for Judgment of the Honourable Justices Hill and Sackville.

Associate:

Dated: 3 ~ude, 1997

Heard:	24-25 February, 1997
Place:	Sydney
Decision:	3 June, 1997

Counsel for appellant:	Mr B. Rayment QC, Mr G. Nell
Solicitors for appellant:	Ebsworth & Ebsworth
Counsel for respondent:	Mr A. Street SC
Solicitors for respondent:	Allen Allen & Hemsley