Town of Port Hedland v Reece William Hodder By Next Friend Elaine Georgina Hodder - [2012] WASCA 9

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JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT : THE COURT OF APPEAL (WA)

CITATION: TOWN OF PORT HEDLAND -v- REECE WILLIAM HODDER BY NEXT FRIEND ELAINE GEORGINA HODDER [2012] WASCA 9

CORAM: PULLIN JA

HEARD: 20 DECEMBER 2011

DELIVERED : 17 JANUARY 2012

FILE NO/S: CACV 123 of 2011

BETWEEN: TOWN OF PORT HEDLAND
Appellant
AND
REECE WILLIAM HODDER BY NEXT FRIEND ELAINE GEORGINA HODDER
First Respondent
THE YOUNG MEN'S CHRISTIAN ASSOCIATION OF PERTH
Second Respondent

ON APPEAL FROM:
Jurisdiction              :  DISTRICT COURT OF WESTERN AUSTRALIA
Coram  :O'NEAL DCJ
Citation  :HODDER by his next friend ELAINE GEORGINA HODDER -v- TOWN OF PORT HEDLAND [2011] WADC 145
File No  :CIV 1316 of 2008

Catchwords:

Practice and procedure - Application for a suspension order pending the hearing of the appeal

Legislation:

Nil

Result:

Application granted

Category: B

Representation:

Counsel:

Appellant:     Mr S Walsh QC & Mr A D McDonald
First Respondent           :     Mr G Droppert
Second Respondent       :     Mr D R Clyne

Solicitors:

Appellant:     DLA Piper Australia
First Respondent           :     Donna Percy & Co
Second Respondent       :     SRB Legal

Case(s) referred to in judgment(s):

Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308
MR & RC Smith Pty Ltd t/as Ultratune (Osborne Park) v Wyatt [2011] WASCA 43
Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473

PULLIN JA: The appellant is appealing against a decision of the District Court where the appellant was found liable for personal injuries suffered by the first respondent. The District Court ordered the appellant to pay the first respondent's damages in the sum of $5.85 million. The first respondent, who had suffered from a serious disability caused by cerebral palsy before the incident, dived into a swimming pool owned by the appellant and was rendered a quadriplegic. The treatment and care is expensive and the first respondent's mother, who is also his next friend in the litigation, requires funds on an ongoing basis so that she does not have to bear the entire burden of caring for the first respondent.
The appellant sought a stay of judgment pursuant to r 44 of the Supreme Court (Court of Appeal) Rules 2005 (WA).
The general principles that apply in relation to such applications were set out in Eastland Technology Australia Pty Ltd v Whisson [2003] WASCA 307; (2003) 28 WAR 308. See also: MR & RC Smith Pty Ltd t/as Ultratune (Osborne Park) v Wyatt [2011] WASCA 43.
The applicant for a stay carries the onus of moving the court to an exercise of its discretion to grant the stay. The first issue which usually has to be confronted is whether or not a stay is necessary to preserve the subject matter or integrity of the litigation or whether refusal of a stay could create practical difficulties in respect of the relief which may be granted on appeal; that is, that without a grant of a stay, the right of appeal will be rendered nugatory.
If it can be shown that the appeal will be rendered nugatory without a stay, the next point to consider is whether the appeal has a reasonable prospect of success. That will be established if the grounds of appeal have a rational and logical prospect of succeeding; that is, that it would not be irrational, fanciful or absurd to envisage success on the appeal: Samuels v The State of Western Australia [2005] WASCA 193; (2005) 30 WAR 473 [56].
Even if it may be shown that the appeal will be rendered nugatory and that there are reasonable prospects of success, the final matter to be considered is the balance of convenience.
In some cases, if moneys are paid to the respondent before the appeal is determined, there may be a real risk that the money will be dissipated entirely so that it becomes impossible, if the appeal succeeds, to make orders that will see the appellant is repaid the moneys. This is not a case where there would be any prospect of a complete dissipation of the judgment sum. The $5.85 million, if paid, will be paid to the National Australia Trustees as a result of an order made by the trial judge. This order was made when approving the compromise of a settlement concerning the quantum of the claim. The sum will be invested in a tax free environment. The next friend has given an undertaking that pending the appeal, she will not seek any payment which is due to her for past gratuitous services and not take the first respondent on holidays away from Perth which might also result in the expenditure of substantial moneys.
The first respondent has also obtained undertakings from the Disability Services Commission, the Quadriplegic Centre and Health Corporate Network WA Health undertaking not to seek recovery from the first respondent of moneys due to them pending the hearing of the appeal.
However, the appellant does make it clear that some of the moneys will be spent by the trustee paying for ongoing expenses relating to the care and maintenance of the first respondent pending the outcome of the appeal.
This money will not be recoverable if the appellant's appeal succeeds. To that extent, the appellant will not be able to be restored to its original position if it succeeds on the appeal. On the other hand, if a limit of $300,000 is put on what may be expended pending the hearing of the appeal then well over 95% of the judgment sum will be recoverable from the trustee if the appeal does succeed. The fact that most will be recoverable but some will not, is a matter to be weighed in the balance when considering the balance of convenience.
As to the appellant's prospects of success, I am satisfied that there are reasonable prospects of success. The appellant's first ground of appeal asserts that the trial judge erred in holding that reasonable care on the part of the appellant for the safety of the first respondent, as one of the class of entrants to the aquatic centre, required the removal of the shallow end starting blocks from which the first respondent dived. There is also a particular of the ground that the trial judge erred in holding that there was no merit in the appointment of the second respondent as manager of the swimming pool as a reasonable response to the risk posed. The second ground contends that the trial judge erred in law in holding that the second respondent was not required to indemnify the appellant and erred in the proper construction of an agreement relevant to that issue of indemnity. The other grounds allege that the trial judge erred in law in determining that the second respondent's breach of duty was not causative of the first respondent's injury and loss, erred in failing to order contribution from the second respondent and erred in his assessment of the first respondent's contributory negligence in that it was manifestly inadequate.
Finally, it is necessary to consider the balance of convenience. In a case where some of the judgment sum is reasonably and necessarily to be spent pending the hearing of the appeal, then although to that extent the appellant will lose an amount even if the appeal succeeds, that has to be weighed against the fact that the appellant has won the case at trial, is entitled to the judgment sum and will be disadvantaged if some of the judgment sum is not made available pending the hearing of the appeal. This is a very clear case where the appellant does have the need for moneys pending the hearing of the appeal.
The three factors which are normally considered, namely, whether the appeal will be rendered nugatory, entirely or to some extent, the question about whether the appeal has reasonable prospects of success and general discretionary factors concerning the balance of convenience, are all factors to be weighed in making the decision about whether a stay should be granted. What the court must do is try and balance the interests of both parties as best it can.
Applications of this kind do not have to always be an all or nothing outcome. This is one such case. In this case, undertakings on the part of the next friend, first not to draw on some of the moneys that the next friend would be entitled to and secondly not to draw on moneys to take the first respondent on holidays, and an order limiting the amount which can be spent on care and maintenance pending the hearing of the appeal led me to accept the undertakings and make the following orders on 20 December 2011:
Subject to the first respondent's undertaking, there be orders that:
(a)The application be dismissed.
(b)The National Australia Trustees be directed not to expend a total sum of more than $300,000 of the judgment sum and any interest that has accrued thereon on the maintenance welfare and advancement or otherwise for the benefit of the First Respondent without further order of the Court.
(c)The First Respondent do serve a copy of this order on the National Australia Trustees within 7 days of the date of this order.
(d)There be liberty to apply.
(e)Costs of the application be in the appeal.