Travis McEwen Group Pty Limited v Cameron Skene

[1999] NSWCA 265

CITATION:	Travis McEwen Group Pty Limited v Cameron Skene [1999] NSWCA 265
FILE NUMBER(S):	CA 40491/98
HEARING DATE(S):	16 June 1999
JUDGMENT DATE:	23 July 1999
PARTIES :	Travis McEwen Group Pty Limited v Cameron Skene & Ors
JUDGMENT OF:	Meagher JA at 1; Sheller JA at 17; Cole AJA at 18

LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S) :	2652/97
LOWER COURT JUDICIAL OFFICER:	Phegan DCJ

COUNSEL:	Claimant: C.Gee QC/J. Simpkins Opponent: J.Coombes QC, M.J. Claridge, R. Freeman, T.Meakes, J.Stewart, M. Herschderfer
SOLICITORS:	Claimant: Colin Biggers & Paisley Opponents:1 - Mark Kennedy & Co, 2-15, 17-18, 20,22,34,43 Murphys Lawyers, 18 Teakle Ormsby, 21,26 Peter O'Neill,28 Atkinson & Binden, 29 L J Parker & Co, 30 Caro Marasco & Co, 31, 36, 39, 40 Fosters, 32, 37 Gary Stewart & Assoc., 33 O'Brien Connors & Kennett, 35 Wood Marshall Williams, 38 Frances Mary Doyle & Assoc. 41 Edgington & Alfonso, 42 McClellands, 44 Phillips Fox. Opponents 19,23,24,25,27,28 No appearance.
CATCHWORDS:	Practice and Procedure - amendment of pleadings - amendment of statement of claim on 29th day of 31 days of hearing - amendment to join third party as defendant - third party already settled against fourth party - discretionary interlocutory judgment below - order below manifestly unreasonable - discretion miscarried - prejudice to claimant considerations of actual injustice and possibility of injustice.
CASES CITED:	State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146.
DECISION:	leave to appeal granted; appeal allowed.

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA: 40491/98

CORAM: MEAGHER JA
SHELLER JA
COLE JA

Friday 23 July 1999

TRAVIS McEWEN GROUP PTY LIMITED v Cameron SKENE and ORS

JUDGMENT

1   MEAGHER JA: On 2 February 1993 a balustrade on a building apparently occupied and administered by the Manly Municipal Council collapsed when it was being used by schoolchildren attending a rock concert on the premises. A large number of the children fell and were injured. 2   Forty two of those children sued the Council, alleging in effect two heads of negligence: (a) negligent construction of the balustrade, and (b) negligent control of the crowds of children who were there. The Council joined the claimant, which is an architectural company, as a Third Party. It was apparently the entity which designed the balustrade in question. 3   The litigation seems to have proceeded from about November 1997 before Phegan DCJ, and eventually, on the 29th day of the hearing, on 9 June 1998, when the litigation was nearing completion, an application was made by the “plaintiff” (i.e Mr Skene) to amend his Statement of Claim. 4   I might add that the litigation seems to have been conducted on the basis that all forty two matters were heard together, the evidence in one to be evidence in the others. No formal order for consolidation was made. 5   The new, amended Statement of Claim alleged negligence of the Claimant in construction of the balustrade. It also alleged a breach of the “retainer” given to it by the Council, although there must be problems in a plaintiff seeking damages arising out of a contract to which he was not a party. However, this matter need not be pursued, because his Honour made it clear that the leave to amend did not extend to the “retainer” allegation. 6   Mr Skene’s application was in the following terms:

“1. The motion be returnable instanter”
“2. The Plaintiff be given leave to join the third party, Travis McEwen Group Pty Limited, as a Second Defendant to these proceedings.”
“3. The Plaintiff be given leave to file and serve a Further Amended Statement of Claim in accordance with the document which is annexed hereto and marked with the letter “A”.
“4. The costs of this motion be costs in the cause.”

7   The orders made by his Honour on 11 June 1998 were as follows:

“1. Leave granted to the Plaintiff to join the third Party, Travis McEwen Group Pty Ltd, as a Second Defendant.
2. Leave granted to file and serve a Further Amended Statement of Claim provided that the particulars of the Plaintiff’s claim against the Third Party (Second Defendant) but not including those particulars which rely on a breach of retainer.
3. Leave granted on this application shall extend to all other Plaintiffs before me in the proceedings against Manly Municipal Council. As to those Plaintiffs whose Further Amended Statement of Claim would be barred by Statute of Limitations, 1969, leave to proceed is hereby granted.
4. Costs of all other parties on this application be paid by the plaintiffs.
5. The matter be stood over generally”

8   It is against His Honour’s orders that the claimant seeks leave to appeal. 9   His Honour’s decision was discretionary, and the difficulties of appealing against a discretionary interlocutory judgment, particularly if it deals with a matter of practice and procedure are well known; yet, with some uncertainty, I have come to the conclusion that the application should succeed, because the orders made seem to me so manifestly unreasonable that the discretion must have miscarried. 10   The plaintiff’s application to amend his statement of claim was made very late in the day, it would seem during final addresses. His Honour was conscious of the delay. We know a conscious election was made by the plaintiffs earlier in the case not to join the present appellant as the second defendant, his Honour during early directions hearings having brought the matter to their attention. 11   What is more important, his Honour did not seem to give any weight to the prejudicial effect of the orders he made on the claimant. He did not, for example, allude to the fact that the claimant had settled its case against a fourth party (viz. the builder), presumably on the basis of the existing pleadings. 12   Moreover, the way the case should have been conducted by the claimant was seriously affected by the amendments. I have mentioned that the plaintiff’s case against the Council was twofold: negligent construction and negligent crowd control. Until the amendment was granted the claimant had confined its litigious interest to the latter of these complaints: tactical reasons required it to withhold its hand from the former. Now, after the amendments were granted, the claimant would be in serious peril in maintaining this attitude. More generally, as a mere Third Party it would have been in the claimant’s interest that the Defendant win. It would then be free of liability. If it were a Defendant it would be in its interest to see the other defendants lose to bolster its rights to contribution. It is difficult to see how this injustice could be cured by anything short of recommencing the litigation. 13   The crux of his Honour’s error emerges, I think, from the following passage in his Honour’s reasoning:

“On the other hand, the possibility and that is the only reason that the matter arose on Tuesday and I underline the word possibility, that these proceedings might ultimately be resolved as they now stand with a verdict for the defendant against such a large number of plaintiffs in circumstances where it is at least now known that there might have been another defendant who might have been found liable is a very unsatisfactory outcome.
“My task in dealing with this application is to attempt to meet the ends of justice more than any other consideration and because of that last matter that I have just mentioned it seems to me that I could not in all good conscience reject the application because it might have as a possible outcome the outcome that I have just described, but having said that, and for reasons which again I don’t propose to repeat because I hope I have made my position very clear, the implications of allowing the application cause me grave concern in terms of the proper use of this court’s time apart from any other consideration."

14   In other words, his Honour was more interested in eliminating the mere possibility of injustice to the plaintiff than in considering the actual injustice suffered by the claimant. 15   The claimant also complains about his Honour’s conduct in making orders in favour of the plaintiffs under the Limitation Act although no such orders were sought or evidence given in respect of them. These complaints are justified. Nonetheless I would prefer to rest my judgment on the broader issues. 16   In my view the following orders should be made:

1. Appeal allowed with costs;
2. Orders below set aside
3. In lieu thereof, order that the motion in the District Court by Cameron Skene be dismissed with costs.

17   SHELLER JA: For the reasons given by Meagher JA and Cole AJA I agree with the orders proposed by Meagher JA.
18 COLE AJA: I agree with Meagher JA. 19 The High Court in State of Queensland v JL Holdings Pty Ltd (1997) 189 CLR 146 made plain that, in determining an application for amendment, whenever brought, "justice is the paramount consideration" Per Dawson, Gaudron and McHugh JJ at 154, 155. 20 There are two matters of major importance which, in my view, are determinative. First, the trial judge raised with the parties prior to the commencement of the trial the question whether the architect applicants should be joined as defendants. The plaintiffs took a considered decision not to join the architects as defendants, with a view to eliminating any risk of costs. They allowed the trial to proceed through twenty-nine days of hearing and submissions before reversing that decision, only doing so after the matter was again raised by the trial Judge. They advanced no reason for the change of approach. Having consciously decided to fight the trial on the basis that the architects were a third party, and not a defendant, they should not be permitted to reverse their position if injustice would result. Here, it would. 21 Second, the architects, as a cross-defendant, would escape any liability if the defendant Council succeeded against the plaintiffs. It is clear that the architects took tactical decisions on the conduct of the trial on that assumption. As cross-defendants, their interest was to have the Council succeed. As a defendant, one view of the architects' interest was to have the other defendant, the Council, fail against the prospect that, if the architects also failed, there would be contribution between the two unsuccessful defendants. This basic change in position, tactical approach and conduct of the litigation was raised by counsel for the architects before the trial judge. In dealing with the application to join the architects as a defendant, the trial judge did not address these issues or the difficulties, amounting to injustice, which would affect the architects were they so joined. 22 I agree with the orders proposed by Meagher JA.

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