Wood v Merck Sharp & Dohme (Australia) Pty Ltd - [2000] NSWDDT 8

CITATION: Frederick W Wood v Merck Sharp & Dohme (Australia) Pty Ltd [2000] NSWDDT 8

PARTIES: Frederick W Wood

Merck Sharp & Dohme (Australia) Pty Ltd

TITLE OF COURT: Dust Diseases Tribunal of New South Wales

JURISDICTION: Original

MATTER NO/S: 49 of 1999

DELIVERED ON: 27 June 2000

DELIVERED AT: Sydney

HEARING DATES: 27 June 2000

JUDGMENT OF: O'Meally P

NUMBER OF PARAGRAPHS: 22

CATCHWORDS: Dust Diseases Proceedings - plaintiff residing abroad - application for Security for Costs - Foreign Judgments (Reciprocal Enforcement) Act 1933 (Imp) - Order in Council recognising certain Australian Courts - Dust Diseases Tribunal not named in Order in Council - Dust Diseases Tribunal Act (NSW) s 14(1)- provision for recognition of order or judgment of DDT as judgment of the Supreme Court of NSW - Supreme Court of NSW recognised by Order in Council - judgment of DDT registrable and enforceable in UK

Dust Diseases Proceedings - Plaintiff residing abroad - application for Order for Security for Costs - within discretion of court to make such order - consideration of discretionary factors - Order for Security for Costs refused

REPRESENTATION
PLAINTIFF

Mr D G Letcher, QC instructed by Turner Freeman.

DEFENDANT

Mr G M Watson instructed by Lander & Rogers.

Dust Diseases Tribunal of New South Wales

Matter No 49 of 1999

Frederick W Wood

Merck Sharp & Dohme (Australia) Pty Limited

27 June 2000

JUDGMENT
O'MEALLY P

By Notice of Motion filed 18 January 2000 the defendant, Merck Sharp & Dohme (Australia) Pty Limited, seeks, so far as now relevant, these orders:
(i)       That the plaintiff give security for the costs of the defendant of and incidental to these proceedings in the sum of $25,000.
(ii)      That these proceedings be stayed until security is given.
(iii)     That the plaintiff pay the defendant's costs of and incidental to this motion.
By Statement of Claim filed on 3 May 1999 the plaintiff, Frederick William Wood, sued the defendant alleging that in the course of his employment by the defendant he was exposed to and inhaled dust including methyldopa as a result of which he suffered injury. The plaintiff’s entitlement to damages and its negligence are disputed by the defendant.
The defendant seeks the order pursuant to Pt 53 r 2 of the Supreme Court Rules which have been adopted and apply in the Tribunal. So far as relevant Pt 53 provides:
2 (1) Where, in any proceedings, it appears to the Court on the application of a defendant—
(a) that a plaintiff is ordinarily resident outside the State;
…
the Court may order that plaintiff to give such security as the Court thinks fit for the costs of the defendant of and incidental to the proceedings and that the proceedings be stayed until the security is given.
The evidence before me discloses that the plaintiff is ordinarily resident at 45 Everton Road, Liverpool LS2EH in the United Kingdom and has been resident there since 1 April 1995. The plaintiff was resident and employed in Australia for some long number of years before his return to the United Kingdom where he was born fifty‑five years ago. Immediately before he left Australia he was, with his wife, the owner as joint tenant of a residential property in Toongabbie, a suburb of Sydney. Before he returned to the United Kingdom this house was sold and realised to the plaintiff and his wife the approximate sum of $150,000. Before returning to the United Kingdom the plaintiff also received the sum of $16,000 as a "superannuation payout" when he ceased his employment by the defendant. The plaintiff's affidavit sets forth the disposition of this money following his return to the United Kingdom. After the sale of the house the proceeds were divided equally between the plaintiff and his wife. His affidavit refers to his share being used to purchase airline tickets, paying for the quarantining in the United Kingdom of a family pet, which was taken from Australia, and for his living expenses until he was awarded social security payments in the United Kingdom in June 1995.
The plaintiff is currently in receipt of social security which rose from £70.00 per week for his wife and himself to £90.00 per week. Of the £90.00, £20.00 weekly is for the support of his wife. The evidence further discloses that the plaintiff has a bank balance presently of some £200.00 and his wife has an amount of some £1,700.00 standing to her credit in a bank account.
This case first came before the Tribunal on 10 May 1999 for the purpose of making directions for the preparation of the case. On that day I was handed draft short minutes of orders and made the orders as therein set out. Those orders provided for requests and supply of particulars, for the filing of a defence, for the administration of interrogatories, for the provision of answers, for verified general discovery, for service of medical reports, for identification material to be relied upon pursuant to s 25(3) of the Dust Diseases Tribunal Act and for the filing and service of particulars under Pt 33 r 8A. Had those orders been complied with the case would have had a date for hearing fixed on 25 October 1999. Those orders were not complied with and on 25 October 1999 further orders were entered, which, if complied with, would have brought the matter back before me on 20 March 2000 to fix a date for hearing.
An amount of preparation for the case had been completed before the defendant gave notice on 9 November 1999 of its intention to apply for security for costs. The application was, as recited, filed on 18 January 2000. The defendant submits that it is entitled to the order sought because the plaintiff is ordinarily resident outside the State, that is to say in the United Kingdom, that it has conservatively estimated its costs of defending the action at $43,500, that the plaintiff has no assets in Australia and that he and his wife left Australia with assets in excess of $166,000. Plainly on the material to which I have referred the plaintiff's assets were then considerably less than $166,000 but more than $43,5000. His assets now are considerably less.
The plaintiff says that in the circumstances no proper basis has been established for an order for security of costs. In the alternate it is said that if such an order is to be made it should be only for an amount which will cover the costs of registering such judgment or order for costs as the defendant may obtain in the event the plaintiff fails. That is about £20.00. The defendant, however, says that such a judgment may not be registered in the United Kingdom. The relevant legislation in the United Kingdom is the Foreign Judgments (Reciprocal Enforcement) Act 1933 (Imp). S 1 of that Act so far as relevant provides:
(1) If, in the case of any foreign country, Her Majesty is satisfied that, in the event of the benefits conferred by this Part of this Act being extended to, or to any particular class of, judgments given in the Courts of that country or any particular class of those courts, substantial reciprocity of treatment will be assured as regards the enforcement in that country of similar judgments given in similar courts of the United Kingdom, She may by Order in Council direct -
(a)that this Part of this Act shall extend to that country;
(b)that such courts of that country as are specified in the order shall be recognised courts of that country for the purpose of this Part of this Act; and
(c)that judgments of any such recognised court or such judgment of any class so specified, shall, if within (2) of this section, be judgments to which this Part of this Act applies.
…
By Order in Council made on 19 July 1994 various courts of Australia were declared to be recognised for the purpose of Pt 1 of the Foreign Judgments (Reciprocal Enforcement) Act 1933 (Imp). Those courts included the Supreme Courts exercising jurisdiction in respect of each Australian State or Territory. The Order in Council made no reference to the Dust Diseases Tribunal of New South Wales.
The defendant says that it is not therefore open to it, in the event that it obtains a judgment from the Tribunal, to have the judgment registered pursuant to the English statute. In this connection it is relevant to have regard to s 14 of the Dust Diseases Tribunal Act. So far as relevant s 14 provides:
14 (1) If a judgment or order of the Tribunal is for payment of an amount of money (including a sum awarded as costs) the judgment or order shall, on the filing of the prescribed documents in the registry of the Common Law Division of the Supreme Court, be taken to be a judgment of that court for the payment of the amount of money in accordance with the judgment or order of the Tribunal.
…
In my view, the effect of this section is that once a judgment, whether for damages or costs, is made in the Tribunal and filed in the Common Law division of the Supreme Court it is for all purposes a judgment of the Supreme Court. This is so notwithstanding the provisions of s 208JA of the Legal Profession Act 1987. That section provides for the giving of a certificate by a costs assessor and subs (4) provides:
(4)The certificate is, on the filing of the certificate in the office or registry of a court having jurisdiction to order the payment of that amount of money, and with no further action, taken to be a judgment of that court for the amount of unpaid costs.
Counsel for the defendant says the effect of this section is that the judgment is not taken to be a judgment of the Supreme Court but of the Tribunal. Counsel have been unable to inform me whether, in 1987, subs (4) of s 208JA of the Legal Profession Act was in the form quoted. If, contrary to my view, there were some inconsistency between that provision and s 14 of the Dust Diseases Tribunal Act then the latter Act would have prevailed over the Legal Profession Act 1987.
There is no means by which the Tribunal may enforce its judgments. The only means by which an unsatisfied judgment of the Tribunal may be enforced is by registration in the Common Law Division of the Supreme Court. Unsatisfied judgments are then enforced as judgments of the Supreme Court. It remains my view that once a judgment or order of the Tribunal is filed in the Common Law Division of the Supreme Court it is for all purposes a judgment of that court and, accordingly, upon appropriate procedural steps having been taken in the United Kingdom, it is capable of being registered and enforced in that country.
It is appropriate now to consider whether an order for security for costs should be made. The defendant, relying upon the decision of MacFarlan J in Demag-Lauchhammer Maschinenbau und Stahlbau GmbH v John Holland (Constructions) Pty Limited (1966) 85 WN 231 says that in the circumstances of this case such an order should be made. Demag-Lauchhammer was a case in the Commercial Causes list in the Supreme Court of New South Wales. The provision there under consideration was Order XV r 3, which, I am informed by counsel, was, so far as relevant, in identical terms to Pt 52 r (1)(a). Speaking of the rule as it then stood MacFarlan J said at 233:
Although there are some references in earlier authorities to the necessity for applying promptly for an order for security for costs, Order XV, r 3 provides that the application may be made after appearance has been entered and, although delay is undoubtedly a matter to be considered in the exercise of any discretion, it seems to me that it is not in itself to be treated as a waiver by a defendant of a claim otherwise good, to have an order for security.
At 234 MacFarlan J said:
In Kohn v Rinson & Stafford Ltd [1948] 1 KB 327 Denning J (as he then was) was required to consider the effect of the Administration of Justice Act 1920 (Imp) on an application for security of costs in an action in England when the plaintiff resided in Palestine. It is not material for me to refer to the nature of the matters which were involved in that consideration, except to quote what the learned judge said in the course of his judgment with respect to the general rule which was applicable where the plaintiff was a person residing outside the jurisdiction and did not have assets within it. At p 330 his Lordship said: “The law on the matter is plain, that it is in the discretion of the court to order security for costs, but it does so as a matter of course when a plaintiff is out of the jurisdiction and there are no assets of the plaintiff which can be reached within the jurisdiction, the reason being that if a judgment is thereafter obtained by the defendant against the plaintiff for costs, such an order cannot be enforced by the direct process of the English court.”
It is argued for the plaintiff that discretionary factors should operate against the making of an order. These are: the prospects are that the plaintiff will succeed; the bona fide nature of his case; his impecuniosity and his lack of funds are due to the defendant's conduct; the likelihood that a costs order in favour of the defendant will be made at the conclusion of the proceedings if the plaintiff fails; the plaintiff is not a corporation; the application was not made expeditiously; and the defendant's motivation for the application somehow should operate to prevent the order being made. In relation to this last matter I would not criticise the defendant for bringing the application, but the questions are, as they seem to me, whether there is a prospect that the plaintiff will succeed, whether the delay in bringing the application is such that the order should not be made and whether the plaintiff has deliberately put himself into a state of impecuniosity. As to the last of these I see no evidence to justify that conclusion.
It should be noted that if an order for costs is made against the plaintiff that order can “be enforced by the direct process of the English court” (per Denning J in Kohn v Rinson & Stafford Ltd [1948] 1 KB 327 by reason of the Foreign Judgments (Reciprocal Enforcement) Act 1933 (Imp) and the Order in Council of 19 July 1994.
The evidence before me includes, as an annexure to the affidavit of the plaintiff's solicitor, a report of Dr M W Burns, a thoracic physician practising in Sydney. He examined the plaintiff at his home in Liverpool in the United Kingdom on 28 September 1998. Attached to his report is an extract from the 1979 British Medical Journal. At 1461 is a report of the case of a woman who commenced work in 1973 as an analytical chemist in a factory making methyldopa tablets. Two to three months later she developed blockage of the nose and repeated sneezing at work which improved after three weeks. Her symptoms appeared intermittently with increasing frequency. She noted that they seemed to occur when methyldopa powder was present in the room. Six months before her referral to the hospital she developed exercise induced asthma. This was better when she was away from work on holiday. The clinical tests conducted were recited in the report and it was noted that similar asthmatic reactions had been described in other pharmaceutical industry workers after inhaling various other powders.
It is important to bear in mind that a case of methyldopa induced asthma was reported in the literature in 1979. It is appropriate also to note that the defendant is a manufacturer of pharmaceutical products. That the risk of methyldopa induced asthma was recorded in the medical literature at least by 1979 makes it not unreasonable to expect that knowledge of that risk should have come to the attention of the defendant. On the evidence before me prima facie the plaintiff has a reasonable case.
I am not satisfied that the impecuniosity of the plaintiff and his lack of funds are due to the defendant's conduct. That may well be the case but the evidence does not suggest to me that that has been established even on a prima facie basis.
Were I disposed to make an order it would be that the plaintiff provide security for costs, but limited to the cost of registering in the United Kingdom such order or judgment as it may obtain here. However, the failure to comply with the orders made in May and October 1999 and the amount of work done by the plaintiff's solicitors until the Notice of Motion was filed bring me to the view that it would be inappropriate to make the order sought. I should say, also, that this is the first such application to have come before the Tribunal, which has been in existence since 1989. I do not know of, nor have counsel been able to refer me to, any case in which an order for security of costs has been given in a personal injury case.
The application is refused.
The defendant applicant will pay the plaintiff's costs as agreed or assessed.
I decline to order indemnity costs.
For directions 14 August 2000.

Mr D G Letcher, QC instructed by Turner Freeman appeared for the plaintiff.

Mr G Watson instructed by Lander & Rogers appeared for the defendant.