Willimott v JC Canberra Management t/as Cosmos Clinic Canberra and Lee

[2015] ACTMC 11

MAGISTRATES COURT OF THE AUSTRALIAN CAPITAL TERRITORY

Case Title:

Willimott v JC Canberra Management t/as Cosmos Clinic Canberra & Lee

Citation:

[2015] ACTMC 11

Hearing Date(s):

27 October 2015

DecisionDate:

10 November 2015

Before:

Magistrate Morrison

Decision:

See [17]

Category:

Interlocutory application

Catchwords:

CIVIL LAW –  medical negligence – breach of contract – breach of implied warranties – application for summary judgment – application of the Trade Practices Act 1974 (Cth)

Legislation Cited:

Australian Consumer Law (“ACL”), (schedule two of the Competition and Consumer Act 2010 (Cth)) ss 60, 236 and 275
Fair Trading (Australian Consumer Law) Act 1992 (ACT)
Limitation Act 1985 (ACT) s 16B

Trade Practices Amendment (Australian Consumer Law) Bill 2009 (Cth)
Trade Practices Amendment (Liability for Recreational Services) Act 2002 (Cth)
Trade Practices Amendment (Personal Injuries and Death) Act (No 2) 2004 (Cth)
Trade Practices Act1974 (Cth) ss 74; 82; 83

Cases Cited:

Dey v Victorian Railways Commissioners [1949] HCA 1; (1949) 78 CLR 62
Commissioner for Revenue (ACT) v Dataflex Pty Ltd (2011) 5 ACTSCLR 271

Parties:

Fiona Willimott (plaintiff/respondent)
JC Canberra Management (first defendant)
Christopher Lee (second defendant/applicant)

Representation:

Counsel
Mr D Shillington (plaintiff/respondent)
Mr W Sharwood (second defendant/applicant)

Solicitors

Snedden Hall & Gallon (plaintiff/respondent)
Minter Ellison (defendant/applicant)

File Numbers:

CS 830 of 2013

MAGISTRATE MORRISON:

1.The plaintiff’s originating claim is for damages for personal injuries she says she suffered as a consequence of surgery performed by the second defendant. The claim as amended makes allegations against both defendants of negligence, breach of contract and breach of what are described as implied warranties under the Trade Practices Act1974 (Cth) (“TPA”), the Fair Trading (Australian Consumer Law) Act 1992 (ACT) and the Australian Consumer Law (“ACL”), (schedule two of the Competition and Consumer Act 2010 (Cth)).

2.It is agreed for the purposes of the application that the relevant procedures were carried out between 17 November 2010 and 8 May 2012. 

3.The second defendant has applied for summary judgment against the plaintiff on the basis that her cause of action is not maintainable against him, on any of the alternate bases pleaded, by virtue of section 16B of the Limitation Act 1985 (ACT) (“Limitation Act”).

4.The argument before me concentrated on the pleaded causes of action under section 74 of the TPA and section 60 of the ACL. The argument proceeded on the basis that section 74 of the TPA applied at the time some of the services rendered and section 60 of the ACL applied at the time of others because of the changes in the legislation. I have accepted that position without consideration of any transitional provisions. The question at the heart of the argument is about the interaction of, in the case of the TPA – sections 74, 74(2A) and 83; and in the case of the ACL – sections 60, 236 and 275.

5.Section 16B of the Limitation Act applies a 3 year time limit on personal injury claims.

6.Both the TPA and the ACL provide for limitation periods on claims. The respondent says that the 6 year time limit in section 82 of the TPA and section 236 of the ACL apply to her claim.

7.The applicant says that both the TPA and the ACL provide in certain circumstances for certain State and Territory laws to be picked up. The relevant provisions are section 74(2A) of the TPA and section 275 of the ACL. The applicant says that they apply to the plaintiff’s claim and that the laws so picked up include section 16B of the Limitation Act, such that her cause of action is statute barred.

8.In the case of the TPA the relevant limiting provision is section 74(2A) which reads as follows:

74(2A)

If:

(a)  there is a breach of an implied warranty that exists because of this section in a contract made after the commencement of this subsection; and

(b)  the law of the State or Territory is the proper law of the contract;

the law of the state or Territory applies to limit or preclude liability, and recovery of a liability, for breach of another term of the contract.

9.In the case of the ACL the limiting provision is section 60, which reads as follows:

If:

(a)  there is a failure to comply with a guarantee that applies to a supply of services under Subdivision B of Division 1 of Part 3-2; and

(b)  the law of a State or a Territory is the proper law of the contract;

that law applies to limit or preclude liability for the failure, and recovery of that liability (if any), in the same way as it applies to limit or preclude liability, and recovery of any liability, for a breach of a term of the contract for the supply of the services.

10.The law to be applied in deciding the application is accurately set out at paragraph 10 in the written submissions prepared by Mr Sharwood of Counsel for the applicant.  That statement of the law was not challenged. 

11.Section 74A of the TPA pre-supposes the existence of some contract which is then taken to include a statutorily-implied warranty. As I understood the submissions, the second defendant denied the existence of any contractual relationship with the plaintiff, but accepted that the question was arguable such that section 74A was to be considered for the purposes of the application.

12.The applicant’s argument is that the plain meaning of the words used – that being a law which applies to limit or preclude liability for the breach (in the case of the TPA) or failure (in the case of the ACL) and recovery of that liability – covers the Territory law set out in section 16B of the Limitation Act.

13.The respondent argues that the limiting provisions do not extend to pick up the Limitation Act, but rather other liability limiting provisions such as, or perhaps limited to, that which exists to limit liability for claims arising out of recreational activities.

14.In support of that submission, counsel for the respondent, without objection, referred me to the explanatory memorandum accompanying the Trade Practices Amendment (Australian Consumer Law) Bill 2009 (Cth), that being the Bill which became the Act introducing the ACL. What was handed up to the Court was in fact a photocopy of a single page of a textbook which I was told was titled “Australian Consumer Law” and published by LexisNexis.

15.That page of the textbook includes the following:

The Explanatory Memorandum provides the following explanation of this limitation of liability:

“The States and Territories have laws that allow providers of recreational services to exclude or limit their liabilities in respect of implied conditions and warranties in consumer contracts.  It is expected that the States and Territories that currently have such laws in place will choose to have similar laws that exclude liability in respect of consumer guarantees.

The ACL provides for such laws to have effect to limit the guarantees provided for in Chapter 3, Part 32, Division 1, Subdivision B of the ACL.

Part XI of the CC Act provides for suppliers of recreational services excluding, restricting or modifying their liability to consumers for death or personal injury of an individual.”

Recreational services are defined in the CC Act as services that consist of participation in a sporting activity or similar leisuretime pursuit or any other activity that involves a significant degree of physical exertion or physical risk undertaken for purposes of recreation, enjoyment or leisure. This definition is intended to encompass activities that involve significant risk or exertion by the participant.

16.As I understand the submissions on behalf of the respondent, they are that, on the basis of the contents of the explanatory memorandum as set out in what was handed up to the Court, section 275 is to be construed as applying only to limits imposed by State or Territory laws in relation to the application of consumer guarantees to the providers of recreational services, or that type of limit and not to limitation periods as such.

17.I have decided that the application must be dismissed because I cannot conclude on the basis of the material before me that section 74(2A) of the TPA and section 275 of the ACL do pick up section 16B of the Limitation Act. That is not to say that I have decided that they do not – rather that the question of whether they do or not is a substantial and difficult question of law not appropriately determined in a summary application – see Dey v Victorian Railways Commissioners. [i]

18.The reasons for that conclusion follow.

19.The question before the Court is one of statutory interpretation. Consideration of extrinsic material is appropriate in the circumstances, consistently with the decision in Commissioner for Revenue (ACT) v Dataflex Pty Ltd,[ii] where the Court of Appeal said this at 278:

The starting point is the text itself (Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 (“Alcan”) at [47]), although a decision on the meaning of the text begins with an examination of its context (Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355 (“Project Blue Sky”) at [69]). “Context” is used in its widest sense to include such things as the existing state of the law and the mischief the statute was intended to remedy: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408. That means that it is proper to have regard at the outset to extrinsic materials and not merely if the language is ambiguous. But historical considerations and extrinsic materials cannot displace the clear meaning of the text: Alcan. These principles of the common law are also reflected in the Legislation Act 2001 (ACT) (“Legislation Act”).

20.The extrinsic material which is before me is limited to the extract from the explanatory memorandum accompanying the Trade Practices Amendment (Australian Consumer Law) Bill 2009 (Cth), that being the Bill which became the Act introducing the ACL. Section 275 of the ACL has however been carried over by the draftsman from section 74(2A) of the TPA in almost identical terms. It follows that examination of the existing law and the mischief the statute was intended to remedy calls for examination of the predecessor provisions of the TPA.

21.Important amendments were made to the TPA between 2002 and 2004 to deal with claims for personal injury or death arising from a contravention of the Act. Those amendments followed a report from a panel of experts appointed by the Commonwealth to review the law of negligence. That report is “The Review of the law of Negligence: Final Report”[iii] (known as “the Ipp Report”).

22.That Report made a range of recommendations, and the subsequent amendments to the TPA included amendments in some cases which prevented claims for personal injury based on contraventions of the TPA; and in other cases which expressly imposed certain limits on claims for personal injury, including a 3 year limitation period; but the amendments so made did not include the imposition of any such limits on claims based on contravention of section 74 of the TPA.

23.The principle source of the amendments to the TPA which took place were the Trade Practices Amendment (Liability for Recreational Services) Act 2002 (Cth); and the Trade Practices Amendment (Personal Injuries and Death) Act (No 2) 2004 (Cth).

24.The explanatory memorandum to the Bills which became those amending act refer to the IPP Report and also to interaction between the TPA and relevant State and Territory laws.

25.However neither of those amending acts inserted section 74(2A) into the TPA. That was achieved via the Treasury Legislation Amendment (Professional Standards) Act 2004 (Cth) – an Act which otherwise deals with the application of State or Territory laws which limit occupational liability to several pieces of Commonwealth legislation. Interestingly, the Bill which became that Act did not when originally presented provide for the introduction of section 74(2A) but was amended to include it before the final reading. There exists both an explanatory memorandum issued for the amendment to the Bill and a record of the speech by the then Parliamentary Secretary to the Treasurer when presenting the amendment.

26.To the extent that the extrinsic material refers (in future tense terms) to accommodating reforms contemplated in State and Territory laws it may be necessary to consider what reform took place in the Territory at that time, including any reforms by way of amendment of the Limitation Act.

27.There is a further aspect of the matter which potentially adds complexity to the construction considerations.

28.Consideration of the intended interaction between State/Territory laws and the section 74(2A) of the TPA is relevant because breaches of implied warranties under section 74 of the TPA do not create a statutory cause of action. Any remedy is pursued on the contract under State/Territory law.

29.The intended interaction between State/Territory laws and the ACL may require different consideration when looking at the construction of section 275 of the ACL because section 60 of the ACL does create a statutory cause of action, although that is not something which appears to be reflected in any drafting change between section 275 (ACL) and section 74(2A) (TPA).

30.Finally, a comment about the extract of the explanatory memorandum in evidence is called for. What is not apparent in the textbook version is that the passage reproduced there appears in the explanatory memorandum under the title “Limitation of Liability for Recreational Services”. It is clear that, at the time of the review leading to the Ipp Report there was much public debate about liability and insurance in the area of recreational services. The subject eventually gave rise to the special amendments to the TPA set out in the Trade Practices Amendment (Liability for Recreational Services) Act 2002 (Cth).  In my opinion the extract appearing in the text should have included the heading under which the comments appear. That context leaves open an inference that the author of the explanatory memorandum was intending to do no more than comment on the intended interaction between section 275 in one particular (topical) area rather than to describe the limits of its application.

31.For the reasons given, the construction question posed is a substantial and difficult question of law and not appropriate for determination by way of summary application. 

32.The application is dismissed.  I order that the costs of the application be reserved unless either party makes an application seeking some other costs order within 14 days.  

I certify that the preceding thirty-two (32) paragraphs are a true copy of the Reasons for Decision of his Honour Magistrate P J Morrison.

Associate: Anna Carlander

Date: 10 November 2015

[i] [1949] HCA 1; (1949) 78 CLR 62.

[ii] (2011) 5 ACTSCLR 271.

[iii] Australia Treasury Law of Negligence Review Panel and David Ipp, ‘Review of the Law of Negligence: Final Report’ (Commonwealth of Australia, September 2002).