Wallis v Downard-Pickford (North Queensland) Pty Ltd

[1993] HCATrans 7

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Brisbane No BSS of 1992

B e t w e e n -

KENNETH GEORGE WALLIS

Applicant

and

DOWNARD-PICKFORD. ( NORTH

QUEENSLAND) PTY LTD

Respondent

Application for special leave

to appeal

MASON CJ
TOOHEY J

GAUDRON J

Wallis 1 5/2/93

TRANSCRIPT OF PROCEEDINGS

FROM BRISBANE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 5 FEBRUARY 1993, AT 1.48 PM

Copyright in the High Court of Australia

RP.A. KEANE, QC:  May it please the Court, I appear with MS_

A.I. PHILIPPIDES, for the applicant. (instructed by

Murrell Stephenson)

MR J.D.M. MUIR, QC:  May it please the Court, I appear with

MR J. SULLIVAN, for the respondent. (instructed by

W.T. Purcell Chadwick & Skelly)

MR KEANE:  Your Honours, the respondent to this application

was a carrier - - -

MASON CJ:  We are familiar with the facts, so you can come

straight to the two points of inconsistency.

MR KEANE:  Yes. Your Honours, the submission is that the

learned primary judge was correct in concluding

that section 6 of the Carriage of Goods by Land Act

was not effective to limit the carrier's liability

and that His Honour was correct in holding that it

was inconsistent with sections 68 and 74 of the

Trade Practices Act.

Your Honours, the Court of Appeal concluded to

the contrary, commencing at page 25 lines 30 to 45

and in a lengthy passage of reasoning, which

concludes at page 28 lines 1 to 15, the question of

inconsistency was resolved contrary to the view
taken by the learned primary judge on the footing
that section 68 of the Trade Practices Act operates
only to avoid terms of contracts that purport to
exclude, restrict or modify any liability of a

corporation for breach of a condition or warranty

implied by the other provisions of the Act, and

that this limited operation of section 68 of the

Trade Practices Act itself suggests that the general limitation on liability prescribed by the

Carriage of Goods by Land Act is not inconsistent

with the liability created by section 74(1) of the

Trade Practices Act and, in particular, Your

Honours will see that from the record at page 26

point 8, to 27 about line 45.

Your Honours, the Court of Appeal went on to

conclude that:

Section 74 of the Act does not concern itself

with the quantum of damages which can be

recovered for breach of the implied warranty

which it introduces -

and that is said at page 27 lines 19 to 21, lines

34 to 45 and page 30 lines 1 to 15.

Your Honours, putting the matter broadly, if

we may for a moment, the submission which the

applicant would wish to agitate on appeal is that

Wallis 2 5/2/93

section 6 of the Carriage of Goods Act, by virtue

of the limitation upon a carrier's liability which

it seeks to create and the necessary limitation

upon the rights of a consumer having the benefit of
a warranty under section 74(1), is inconsistent
with the scheme of rights and duties erected by

section 74 of the Trade Practices Act.

It would be submitted on behalf of the

applicant that the point is not, as appears to have

been the essential focus of the Court of Appeal,

that the limit of the operation of section 68 of
the Trade Practices Act is to deny effect to

section 9 of the Carriage of Goods Act, but rather

whether section 6 may operate to limit or in any

way diminish the rights created pursuant to

section 74 of the Trade Practices Act and in

particular, to restrict or impair the effect of the

warranty implied by section 74.

Your Honours, it would be our submission that

Trade Practices Act which provide for the recovery of loss or damage for breach of an implied warranty, for example sections 73(1) or 74B(l).

absent some valid restriction, the vindication of the
that warranty involves payment of the sum

representing the value of the broken promise.

As an adjunct, Your Honours, to our

submission, it would be submitted that the

provision made by section 74 of the Trade Practices

Act cannot be diminished by a provision of the

State legislation.

MASON CJ:  When you say "as an adjunct to your submission",

what do you mean by that?

MR KEANE:	Your Honours, in our submission it is not correct to treat the two pieces of legislation as being
consistent simply because section 6 of the State
Act recognizes a liability in the carrier when the
effect of section 6 is to diminish or impair the effect of the warranty implied in favour of the
consumer by section 74 by limiting the amount of
recovery in respect of breach.

GAUDRON J: Which provision of the Trade Practices Act deals

with damages for a breach of section 72? Is it

section 7:3?

MR KEANE: Section 74, Your Honour. There is no express

provision which deals with this particular matter.

We referred Your Honours to section 73 which has specific provision in relation to contracts where

there has been a supply by a finance house, and in

section 73(1) there is express provision saying

Wallis 5/2/93

that the supplier of the goods and the finance

house, referred to as the linked credit provider,

are:

jointly and severally liable to the consumer

for the amount of the loss or damage, and the

consumer may recover that amount by action in

accordance with this section in a court of

competent jurisdiction.

There is no express provision to that effect in

section 74 but, in our respectful submission,

provisions such as that in section 73 reflect the

intention of the Parliament that the warranty

inserted into the contract by the section may be

vindicated by action in the ordinary way in any

court of competent jurisdiction and that to

diminish the value of that warranty, to make it

something less than the value of the promise or to

make the measure of loss something different from

that which is required to make the promise good, is

indeed to impair the effect of the Trade Practices

Act so as to create an inconsistency.

MASON CJ: But why does one not construe provisions of this

kind in the Trade Practices Act against the

background of the general law so that if there is

some alteration in the general law, then the
measure of damages is thereby affected and the

amount recoverable is thereby affected?

MR KEANE:  Your Honour, the reason one does not is because

if one does not treat the measure of damages that

is recoverable as being the value of the promise

that is implied then, under the general law, the
warranty can be frittered away, so that it has no

effect. For example, if we may say so, in

section 68A of the Trade Practices Act there is

provision for a limited set of circumstances in

which the parties may, by contract, limit that

liability, and that that basically states the

extent to which the rights created by implication

of warranties in the other provisions in this part

may be diminished; and, Your Honours, that there is

no need for the Act to have spelt out an attitude

in relation to other aspects of the general law, as

opposed to what the parties might agree to be the

law between them, because the other aspects of the

general law really mean statutes of the States, and

in relation to that there was no need to spell out

an attitude of the Act in relation to that because

of section 109.

MASON CJ: Yes.

MR KEANE:	Your Honours, the question is not limited to this particular Act.	So far as carriers are concerned
Wallis	4	5/2/93

in New South Wales, Victoria, Western Australia and

Tasmania, legislation is in force limiting the

liability of common carriers, and this question

would arise in the case of any carriage undertaken

pursuant to a contract with a consumer and, of
course, the ramifications are more general than
simply the situation of legislation of the States

dealing with carriers.

As to the prospects that the submissions we

would wish to agitate will be accepted on appeal,

the applicant relies, firstly, upon the view of the
learned trial judge and the success, at first
instance, is some indication that the argument is

not without merit, and, Your Honours, we refer the

Court to the case, the reference to which we gave

the Court, Grace Bros v Rice, (1983) 71 FLR 129, in

particular at 134. Your Honours, that is a

decision which is to the same effect as that of the

learned primary judge in this case. Your Honours,

we appreciate it is a decision of a district court

judge, but we refer it to Your Honours because it

has stood since 1983 for the law, or for a

proposition declaring the law in a way which if it

had not been the intent of the Parliament might

have been expected to attract amendment.
Your Honours, it is taken up in the text such as

Mr Miller's Annotated Trade Practices Act referred to in those texts as authority for the proposition

for which the judgment, at first instance, stands.

Your Honours, secondly, we would submit, that

the very close focus of the Court of Appeal on

section 68 in the passages to which we have
referred the Court, and section 68's evident intent

to avoid contractual attempts to deny the

application of the Act have led to too narrower a
view of the field of conflict, the true question
being whether the rights created by the Trade

Practices Act in its operation, in particular

circumstances, are altered or impaired by section 6

of The Carriage of Goods Act. And as we have	submitted there was no need for the federal
Parliament to have expressed a view in the Act
about that matter because of section 109.
Your Honours, we submit that the point is fairly
arguable and that it does raise a question of general importance.

MASON CJ: Yes, thank you, Mr Keane. Yes, Mr Muir?

MR MUIR:  If the Court pleases, the primary basis on which

the application is resisted is that the judgment of
the Full Court in which all three justices

concurred, is plainly right.

Wallis 5/2/93

The fact that the judge at first instance came

to a contrary conclusion does not detract from the

merits of this submission, Your Honours, when

regard is had to the reasoning which led to

His Honour's conclusions. The reasoning relevantly

is to be found at page 11 of the record and

Your Honours will see at that reference that

His Honour did not consider the question of whether

section 6 of the Carriage of Goods Act had any role

other than that afforded it by section 9. We

submit that that was a fundamental and obvious

error which significantly detracts from our learned

friend's contention, that the fact that there is

some judicial difference is a point which might

merit the High Court's attention.

Your Honours, there is no intention evinced by

the Commonwealth provisions to cover the field.

That may be seen from section 75(1) and (3) of the

Trade Practices Act. Your Honours will see in

subsection (1) that it is expressly provided that:

this Part is not intended to exclude or limit

the concurrent operation of any law of a State

or Territory.

And in subsection (3) that:

Except as expressly provided by this Part,

nothing in this Part shall be taken to limit,

restrict or otherwise affect any right or

remedy a person would have had if this Part

had not been enacted.

Your Honours, that being the case, as

Your Honour the Chief Justice pointed out in

R v The Credit Tribunal, (1976-77) 137 CLR 545 at

564, the remaining question then is whether there

is a direct inconsistency between the Commonwealth

and the State laws.	I do not intend to go to
Your Honour's judgment.
Your Honours, if I can then deal very briefly

with the question of whether there is a direct

inconsistency. If I could firstly refer to

section 68. That section, as is pointed out in the

judgment of the Court of Appeal at page 26 of the

record, concerns itself solely with avoiding

contractual terms of a certain character. Section

6, on the other hand, is concerned not with

contractual provisions, or not only with

contractual provisions, but it provides a general

statutory limitation on carriers liability,
irrespective of the terms of any contract and

irrespective of the existence of any contract.

Wallis 6 5/2/93

Your Honours, it is apparent, we submit, that there is no direct inconsistency between section 68

and section 6. Section 68, of course commences,

"Any term of a contract" and then goes on to make

express provision in that regard.

Turning now, Your Honours, to section 74, the

right conferred by section 74 is purely

contractual. Subsections (1) and (2) of section 74

speak in terms of implied warranty. The benefits

and disadvantages conferred and imposed by

section 6, on the other hand, are entirely extra
contractual, and, as Your Honours pointed out,

section 6 provides a general law background against

which damages are to be calculated. Section 6 says

claims on carriers unless certain prescribed conditions are met, in which case the claim can, of course, be sustained in full. It follows, we

nothing about the warranties implied by section 74.

submit, that there is no direct inconsistency

between those two provisions.

Your Honours, the applicant makes reference to

a statutory scheme, but if one is to find any such

scheme, it is necessary not just to look at section

74, nor to section 68 coupled with section 74,

although putting those two provisions does not

assist the applicant's argument. It is also

necessary to have regard to section 75, which is,
of course, to be found within the same part and

provides part of the framework of any scheme which

may be found to exist, assuming that there be a

scheme. Of course, any such scheme that does exist

in section 74 contains no express provision for

damages and section 75 makes it plain that one may

have regard to provisions outside the

Trade Practices Act in having regard to the

parties' rights and liabilities, notwithstanding

the existence of the claim under section 74.

Your Honours, there is one remaining point and

it is this: if the respondent succeeds on the

constitutional point, it nevertheless will face

another obstacle on appeal. The applicant argued at first instance and in the Court of Appeal that in the circumstances the warranty provided by

section 74(1) did not apply by virtue of the

application of section 74(3). The learned trial

judge found against the respondent on this point on

the basis that the goods were not being transported for the Commissioner's occupation, as the functions

performed by the Commissioner were incident to a

purpose of state rather than an occupation. The judgment in the Full Court expressed doubt about the correctness of that conclusion. So, if special

Wallis 7 5/2/93

leave is granted, that is another matter which

would arise.

MASON CJ:  Thank you, Mr Muir. Yes, Mr Keane. What do you

say about section 75?

MR KEANE:  Your Honours, section 75 is intended, in our

respectful submission, as an attempt to preserve

and a successful attempt to preserve the consumer

protection legislation of the States. Section 75

assumes that there is, indeed, not a clash between

the State legislation and the Federal legislation. In the event of inconsistency, section 75 does not preserve - - -

MASON CJ: That is, in the event of a direct inconsistency,

as they call it.

MR KEANE:  Yes, Your Honour. In the event of a direct

inconsistency, section 75 cannot preserve the State

Act, and it is not surprising that section 75 would

not operate to preserve this - - -

MASON CJ:  No. Well, that was acknowledged in the earlier

High Court case.

MR KEANE:  Yes, Your Honour. Your Honour, the only other

thing we would wish to say is in relation to the

point made in respect of section 74(3).

MASON CJ: Yes.

MR KEANE:  Your Honours, we do rely upon the view taken by

the learned trial judge. It is a view in respect of which the court on appeal expressed doubt, but

did not resolve against us. In any event,

Your Honour, the applicant is not the Commissioner.

The applicant, not the Commissioner, was the person

for whom the goods are transported within the

meaning of section 74(1)(3)(a), so that the

exclusion based upon the position of the

Commissioner, in our respectful submission, does

not operate, because the person for whom the goods

are transported was plainly the applicant and not

the Commissioner. But apart from that we do rely

upon the view expressed by the learned trial judge

as being correct, and that view not having been

upset on appeal.

MASON CJ: Thank you, Mr Keane. There will be a grant of

special leave to appeal in this case.

MR KEANE:  Your Honours please.

AT 2.12 PM THE MATTER WAS ADJOURNED SINE DIE

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