Wilson v F.T. Eastment & Sons Pty Ltd (in liquidation)

[2022] NSWDDT 4

Dust Diseases Tribunal

New South Wales

Medium Neutral Citation:

Wilson v F.T. Eastment & Sons Pty Ltd (in liquidation) and Ors [2022] NSWDDT 4

Hearing dates:

03 August 2022

Date of orders:

17 August 2022

Decision date:

17 August 2022

Before:

Strathdee, J

Decision:

(1)   The restoration costs occasioned by the plaintiff in the Supreme Court proceedings are to be paid by Eastment, with no contribution from Amaca or Seltsam to those costs.

(2)   Eastment is to pay the costs of Amaca and Seltsam on this application in the Dust Diseases Tribunal.

Catchwords:

DUST DISEASES TRIBUNAL – costs of restoration to the company register – payable by whom – deregistered company v insurer

CIVIL PROCEDURE – can orders for costs be made against third parties

WORKERS COMPENSATION – deregistered company and insurer – Insurers’ Guarantee Fund – liability – Workers Compensation Act 1987 (NSW), s 227

COSTS – costs order of Supreme Court – can it be binding in a different court – by whom are the costs of the restoration of a deregistered company to the Company Register payable

Legislation Cited:

Dust Diseases Tribunal Regulation 2019

Workers Compensation Act 1987 (NSW)

Corporations Act 2001 (Cth)

Category:

Procedural rulings

Parties:

Kenneth Andrew Wilson (Plaintiff)
F.T Eastment & Sons Pty Ltd (In Liquidation) ACN 000 399 075 (First Defendant) (Cross-Claimant)
Amaca Pty Limited (Formerly known as James Hardie & Coy Pty Ltd) ACN 000 035 512 (Under NSW Administered Winding Up) (Second Defendant/First Cross Defendant)
Seltsam Pty Limited (formerly known as Wunderlich Limited) ACN 000 003 374 (Second Cross-Defendant)

Representation:

Counsel:
Ms T Moisidis appeared for the First Defendant
Mr J Sheller SC appeared for the Second Defendant
Mr D Miller appeared for the Second Cross-Defendant

Solicitors:
Mr Bruce Cussen, William Roberts Lawyers (First Defendant)
Ms Nicola Murphy, Mills Oakley Lawyers (Second Defendant)
Mr David Miller, Colin Biggers & Paisley Lawyers (Second Cross-Defendant)

File Number(s):

2020/0016195

Judgment

1. On 1 August 2022, I made orders in Chambers with regards to the plaintiff’s claim, such orders being in accordance with paragraphs 1 and 2 of the Consent Order and noting paragraphs 3, 4, 5, 6, 7 and 8.

2. On 1 August 2022, I made further orders in Chambers with regards to Clause 55 of the Dust Diseases Tribunal Regulation 2019 (‘the DDT Regulation’), such orders being in accordance with paragraph 2 of the Order and noting paragraphs 1, 3, 4, 5 and 6.

3. These orders reflected the settlement of the plaintiff’s claim and the cross-claim. The issue outstanding is the question of by whom the costs of the restoration to the Register (‘the restoration costs’) should be paid.

4. F.T. Eastment & Sons Pty Ltd (in liquidation) (‘Eastment’), the first defendant, read an Affidavit of Bruce Adrian Cussen sworn 3 August 2022 (Exhibit 1). Amaca Pty Limited (formerly known as James Hardie & Coy Pty Ltd) CAN 000 035 512 (under NSW Administered Winding Up) (‘Amaca’), the second defendant, read an Affidavit of Nicola Murphy filed 2 August 2022 (Exhibit 2) and tendered a letter from Turner Freeman (the plaintiff’s solicitor in the proceedings) to my Associate dated 3 August 2022 (Exhibit 3). Exhibit 3 provides that the plaintiff formally appears in the proceedings, but as this dispute does not affect the plaintiff, Mr Gardiman appropriately does not wish to attend and waste court time and costs. I agree with that approach.

BACKGROUND

5. By way of Statement of Claim filed 19 January 2022 in the Dust Diseases Tribunal of New South Wales (‘the DDT’), Kenneth Andrew Wilson (‘the plaintiff’) alleged that he was exposed to and inhaled silica dust and asbestos dust and fibres during the course of his employment with Eastment between about 1971 and June 1977, from asbestos products manufactured and supplied by Amaca.

6. The plaintiff’s claim was for injury, loss and damage for the indivisible disease of mesothelioma.

7. Eastment was deregistered and as such was not a legal entity at the time the Statement of Claim was filed.

8. The plaintiff took the appropriate step of making an application pursuant to s 601AH of the Corporations Act 2001 (Cth) to the Supreme Court of NSW against ASIC to have Eastment restored to the Company Register.

9. Eastment held a workers’ compensation policy with Associated General Contractors Insurance Co Limited which was deregistered as at June 1977.

10. The Insurers’ Guarantee Fund (‘IGF’), established under s 227 of the Workers Compensation Act 1987 (NSW) (‘the WC Act’), finances the payment of workers compensation claims when a licenced insurer or an authorised self-insured employer becomes insolvent. However, IGF is not an insurer.

11. The Equity Division of the Supreme Court of NSW issued the following Judgment/Order on 8 February 2022 at 2:47pm. A copy of that order is Annexure “A” to Exhibit 1. For the sake of completeness, I will repeat the orders made in case number 2022/00020900:

“ORDERS/DIRECTIONS

HE (sic) COURT ORDERS THAT:

1.   Pursuant to s 601AH (2) of the Corporations Act 2011 (Cth), the Australian Securities & Investments Commission is to re-instate the registration of F.T. Eastment & Sons Pty Ltd (ACN:000 399 075).

2.   Immediately upon reinstatement of the registration, F.T. Eastment & Sons Pty Ltd (ACN: 000 399 075) be wound up and Mr David Mansfield of Deloitte Financial Advisory Pty Ltd, Eclipse Tower, Level 19, 60 Station Street, Parramatta in the State of New South Wales, be appointed liquidator.

3.   Immediately upon reinstatement of the registration of F.T. Eastment & Sons Pty Ltd (ACN: 000 399 075), the plaintiff has leave nunc pro tunc to commence and proceed with the Dust Diseases Tribunal of New South Wales proceedings numbered 16195 of 2022 at Sydney against F.T. Eastment & Sons Pty Ltd (ACN: 000 399 075).

4.   No step to enforce any judgement or verdict obtained in the Dust Diseases Tribunal of New South Wales in proceedings numbered 16195 of 2022 at Sydney shall be taken by the plaintiff against F.T. Eastment & Sons Pty Ltd (ACN: 000 399 075), otherwise than by resort to indemnity provided by the Insurers’ Guarantee Fund established under s 227 of the Workers Compensation Act without the further leave of the Court.

5.   The costs of this application be costs in the proceedings in the Dust Diseases Tribunal of New South Wales at Sydney numbered 16195 of 2022 at Sydney. Filed 24/01/2022 15:44PM 8030114_1.

6.   These orders be entered forthwith.”

12. A Notice of Appearance was filed in the DDT by Eastment on 11 March 2022.

13. A Statement of Cross-Claim was filed by Eastment against Amaca and Seltsam Pty Limited (‘Seltsam’) on 16 March 2022 seeking indemnity or such contribution as the DDT finds just and equitable, toward any liability that Eastment may be found to have to the plaintiff.

14. In accordance with the Claims Resolution Process (‘CRP’) contained within the DDT Regulation, the matter was sent for a Contributions Assessment and the Determination of that assessment was filed in the Tribunal on 3 May 2022.

15. A mediation also required by the CRP was held. The certificate from the Mediator, Ms Anne Houlahan, pursuant to clause 40 of the DDT Regulations, dated 17 June 2022 (Annexure B to Exhibit 1) indicated that the mediation failed.

16. The plaintiff’s claim was listed for hearing before me to commence 3 August 2022 with an estimate of 3 days. On 29 July 2022, the Tribunal was notified that the matter had resolved, and the matter was placed in the Tribunal’s Directions list before me on 1 August 2022. After discussion in the Directions list, the matter was stood down in the list so as the parties could prepare the relevant Consent Orders.

17. It was noted that the Consent Orders would not deal with the issue of the restoration costs, and that issue was adjourned for argument before me on 3 August 2022. I made orders in Chambers on 1 August 2022 in accordance with the Consent Orders as referred to at paragraphs 1 and 2 of this Judgment.

DISCUSSION

18. Eastment asserts that the restoration costs are the plaintiff’s costs in the proceedings and as such are payable by all the defendants and cross defendants. It submits that the restoration costs were not an order against Eastment, and that the DDT has no jurisdiction to revoke the Supreme Court’s order as to costs.

19. Eastment submits that as Amaca and Seltsam have accepted the share apportioned to them in the Contributions Assessment Determination, and that they should not have the benefit of the reinstatement and contribution by Eastment without also being liable for their respective share of the plaintiff’s costs. Eastment also notes that the plaintiff’s condition was an indivisible disease.

20. In the Statement of Cross-Claim against Amaca filed by Eastment on 16 March 2022, paragraph 12 reads as follows:

12.   “By reason of the breaches pleaded in the preceding paragraphs, the First Cross-Claimant has suffered and will suffer loss and damage.

Particulars of loss and damage

(a) Any liability for the Plaintiff’s claim in these proceedings (including any damages, interest and costs) (which is denied).

(b) The First Cross-Claimant’s costs of these proceedings.”

21. Paragraph 29 of the Statement of Cross-Claim against Seltsam reads as follows:

29.   “The First Cross-Claimant claims from Seltsam the following:

(a) indemnity and/or contribution pursuant to section 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW);

(b) costs of the Plaintiff’s proceedings; and

(c) costs of this First Cross-Claim.”

22. Amaca denies that it is liable to contribute to the restoration costs, particularly because it was not a party to the restoration proceedings nor was it given notice that the plaintiff intended making the application.

23. Amaca submits that as a matter of course, courts do not make orders against third parties, or at least not without the opportunity of the third party being heard. On that basis and acknowledging that Amaca was not a party to the restoration proceedings in the Supreme Court, it is submitted that Order 5 of the Supreme Court orders could not apply to it. Therefore, Amaca submits that Order 5 of the Supreme Court orders can only apply to the parties that were a party to that application, of which Amaca was not. It asserts that I cannot “convert” the order in the Supreme Court between two parties into an order that affects four parties.

24. Seltsam endorses the arguments made by Amaca. Moreover, Seltsam highlights the fact that when the proceedings were before the Supreme Court, Seltsam was not a party to the DDT proceedings, as it was only joined by the cross-claim filed by Eastment on 16 March 2022. Seltsam refutes the submission by Eastment that Seltsam was given a benefit by Eastment being a party to the proceedings in that it contributed to the liability to the plaintiff. It submits that the benefit was in effect to Eastment, as it received a contribution to Eastment’s liability to the plaintiff.

25. Seltsam also directs my attention to clause 55 of the DDT Regulations, as follows:

55.   “Effect of agreement or determination as to apportionment

(1)   An agreement or determination as to apportionment among defendants for the purposes of this Division is conclusively binding on the defendants for the purposes of the settlement, or determination by the Tribunal, of the plaintiff’s claim and payment of the plaintiff’ damages.

(2)   The agreement or determination is not binding for the purposes of the subsequent determination by the Tribunal of a dispute between defendants as to apportionment in a separate proceeding.”

26. Seltsam submits that clause 55(1) contemplates costs orders being made which do not accord with the Contributions Assessment Determination, as it speaks of the determination of the apportionment among defendants being conclusively binding on the defendants, which by definition includes the cross- defendants, for the purposes of settlement of the plaintiff’s claim and payment of the plaintiff’s damages. Seltsam submits that those references militate in favour of a construction that allows the Court to make special costs order of the sort that Amaca and Seltsam seek in this application, that is that they are not responsible for any of the plaintiff’s restoration costs.

27. The parties to the Supreme Court proceedings are Kenneth Wilson, first plaintiff, F.T. Eastment & Sons Pty Ltd ACN 000399075 as first defendant and Australian Securities & Investments Commission as second defendant.

CONCLUSION

28. Accordingly, in my view:

1. I do not have the jurisdiction to revoke the Supreme Court’s costs order, nor am I entitled to amend it or expand it.

2. Order 3 of the Supreme Court Order of 8 February 2022 allows the plaintiff to commence and proceed with the proceedings in the DDT against F.T. Eastment & Sons Pty Ltd. It does not refer to Amaca or Seltsam.

3. As a matter of general principle, Courts do not make orders against third parties without hearing from those third parties

4. Order 4 of the Supreme Court Order of 8 February 2022 prohibits enforcement of any judgment or verdict against F.T. Eastment & Sons Pty Ltd, otherwise than by resort to the indemnity provided by the Insurer’s Guarantee Fund, without further leave of the Court.

5. It is apparent from the wording of Orders 3 and 4 that the Court was not contemplating that there were other parties to the DDT proceedings that would have been affected by Order 5. Amaca and Seltsam were not party to the Supreme Court proceedings

6. If I am wrong in (5) above, Seltsam was only brought into the proceedings by Eastment filing a cross-claim against them, after the restoration order was made. There could have been no contemplation that they were a party who may have become liable for the restoration costs.

7. The orders of the Supreme Court in these circumstances were not capable of translation from an order between Mr Wilson and Eastment as parties to those proceedings to some broader order that would catch both Amaca and Seltsam.

ORDERS:

29. I make the following orders:

1. The restoration costs occasioned by the plaintiff in the Supreme Court proceedings are to be paid by Eastment, with no contribution from Amaca or Seltsam to those costs.

2. Eastment is to pay the costs of Amaca and Seltsam on this application in the Dust Diseases Tribunal.

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Decision last updated: 17 August 2022