Amaca Pty Ltd formerly known as James Hardie & Coy Pty Ltd v CSR Ltd

Supreme Court of NSW|2001-04-09|Before: Bergin J, Rolfe J

CITATION : Amaca Pty Ltd formerly known as James Hardie & Coy Pty Ltd v CSR Ltd [2001] NSWSC 263 CURRENT JURISDICTION: Equity Division Commercial List FILE NUMBER(S) : SC 50053/1999 HEARING DATE(S) : 9 April 2001 JUDGMENT DATE : 10 April 2001

PARTIES : Amaca Pty Ltd formerly known as James Hardie & Coy Pty Ltd (Plaintiff) CSR Ltd (Defendant) JUDGMENT OF : Bergin J

COUNSEL : CG Gee QC/TGR Parker (Plaintiff) PW Taylor SC/JE Fernon (Defendant) SOLICITORS : Allen Allen & Hemsley (Plaintiff) Toomey Pegg Drevikovsky (Defendant) CATCHWORDS : STATUTES - Interpretation. Extent of exclusive jurisdiction of the Dust Diseases Tribunal in respect of cross claims for contribution between joint tortfeasors under the Dust Diseases Tribunal Act 1989. LEGISLATION CITED : Dust Diseases Tribunal Act 1989 Carnuccio v Cinzano (1990) 6 NSWCCR 70 Fencott v Muller (1982-1983) 152 CLR 570 James Hardie & Coy Pty Ltd v Barry & Anor; Seltsam Pty Ltd v Barry & Anor [2000] NSWCA 353 CASES CITED : Law Society of New South Wales v Weaver (1974) 1 NSWLR 271 Mangion v James Hardie & Co Pty Limited (1990) 20 NSWLR 100 National Parks & Wildlife Service & Anor v Stables Perisher Pty Ltd (1990) 20 NSWLR 573 Seltsam Pty Ltd v Energy Australia (1999) 17 NSWCCR 720 Stack v Coast Securities (No.9) Pty Ltd (1983) 154 CLR 261 DECISION : Tribunal's jurisdiction in respect of cross claims not exclusive.

THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION COMMERCIAL LIST

50053/1999 - AMACA PTY LTD formerly known as JAMES HARDIE & COY PTY LTD v CSR LTD

1 These proceedings have been specially fixed for hearing for two weeks commencing 9 April 2001. The plaintiff, Amaca Pty Ltd, formerly known as James Hardie & Coy Pty Ltd, (James Hardie), brings proceedings against the defendant, CSR Ltd (CSR) for judgment in respect of amounts James Hardie has been ordered to pay to Joseph Welch in proceedings against James Hardie (the Welch proceedings) in the Dust Diseases Tribunal of New South Wales (the Tribunal) 2 The Welch proceedings were commenced in 1995. Mr Welch alleged that he had been exposed to asbestos dust and fibre emanating from products manufactured by James Hardie. Some of those products were manufactured by the business operated by a partnership between James Hardie and CSR between 1964 and 1974. 3 On 29 March 1996 James Hardie filed a cross claim in the Welch proceedings in which it sought contribution or indemnity from CSR. 4 On 3 September 1997 judgment was entered by consent against James Hardie in the sum of $81,250. The Terms of Settlement filed in the Tribunal on that day included a term that "Cross claims as between James Hardie & Coy Pty Ltd and CSR and Bradford Insulation Industries Pty Ltd stood over for directions on Monday 8 September 1997". On 20 February 1998 CSR filed a cross claim against James Hardie in which it claimed that any liability to Mr Welch had been caused by breaches of agreement by James Hardie and breaches of duty of care by failing to effect appropriate insurance cover. 5 The cross claims have apparently been stood over generally in the Tribunal. I understand there are approximately another ninety matters of a similar kind that have been stood over generally in the Tribunal pending the outcome of these proceedings. 6 On 16 April 1999 James Hardie commenced these proceedings against CSR in which it seeks declarations that it is entitled to contribution from CSR and that the release in a Deed of Dissolution of the Partnership between CSR and James Hardie and Bradford Insulation Industries Pty Ltd is not a bar upon the plaintiff to making claims against CSR for contribution. 7 On 25 June 1999 CSR filed a cross claim against James Hardie claiming breaches of agreement and/or duty of care by failing to effect appropriate insurance cover. 8 Rolfe J made an order on 17 November 2000 specially fixing the matter for hearing for two weeks commencing 9 April, 2001. On 9 April 2001 CSR moved on a Motion for questions to be tried separately prior to the trial. On that day I made orders that the following questions be tried separately: (a) Whether, and if so to what extent, the claims made by James Hardie and CSR in the present proceedings, have also been included in the Welch proceedings in the Tribunal (Inclusion of Proceedings); and (b) To the extent that the claims have been so included in any such proceedings, whether sections 10(1) and 11(4) of the Dust Diseases Tribunal Act 1989 (the Act) operate, in the events which have happened, to confer exclusive jurisdiction on the Tribunal in relation to any, and if so which, of James Hardie's claims and CSR's claims in these proceedings (Exclusive Jurisdiction). 9 The trial of the separate questions proceeded on 9 April 2001. Mr Gee QC, leading Mr TGR Parker of counsel, appeared for James Hardie and Mr PW Taylor SC, leading Mr J Fernon of counsel, appeared for CSR.

Inclusion of Proceedings 10 The cross claims filed in the Welch proceedings raise the same claims as are raised in the pleadings in these proceedings. There is a point raised by James Hardie that in the Welch proceedings neither the cross claim brought by it nor the cross claim brought by CSR sought declarations. That is so. 11 If I were satisfied that the Tribunal had exclusive jurisdiction in respect of the claims in the cross claims I am of the view that s10(4) would enable it to make the declarations sought having regard also to the definition of decision which "includes judgment, order and ruling"(s3(1)). 12 The question of whether the cross claims were "included" in the proceedings is a nice one. Whether a matter is "included" in the proceedings will depend upon such matters as the filing and service of a pleading. If one takes the view that such inclusion could only occur when the plaintiff's proceedings against the defendant are extant then James Hardie's cross claim was included and CSR's was not. If however the view is taken that once James Hardie's cross claim is filed and served on CSR, CSR is able to make a claim against James Hardie, whether or not the proceedings have settled as between the plaintiff and the defendant, then CSR's cross claim would also be included in the proceedings. 13 I am of the view that it is probable that James Hardie's cross claim was included in the Welch proceedings but that CSR's was not so included, however because of the view I have reached in respect of the exclusive jurisdiction question, it is not necessary to decide that matter finally. This is particularly because I have formed a view irrespective of whether the cross claims were included.

Exclusive Jurisdiction 14 The Act establishes the Tribunal as a court of record. The second reading speech in the Legislative Assembly on 3 May 1989 and in the Legislative Council on 11 May 1989 (Hansard 7398-99 3/5/89; 8094-8096 11/5/89) referred to the delays in obtaining a hearing date in the Supreme Court and District Court of claims for damages for breaches of duty causing personal injury or death attributable to dust diseases and dust-related conditions. The speech continued: Delays, of course, are particularly critical for plaintiffs with dust diseases, such as mesothelioma , which have a long latency period but, once diagnosed, result in rapid deterioration and usually lead to death within 12 to 18 months. The Government is committed to these claims being dealt with expeditiously by the creation of a separate tribunal that will provide a fast-track mechanism. and The tribunal will have jurisdiction also to deal with ancillary and related matters such as questions of insurance, and apportionment of liabilty between multiple defendants and multiple insurers. (Hansard 7398 3/5/89; 8094 11/5/89)

The speeches were silent on the topic of exclusivity.

15 The second question involving the consideration of the extent of the exclusivity of the Tribunal's jurisdiction requires an interpretation of ss 10, 11 and 12 in Part 3 of the Act which provide; PART 3 - JURISDICTION OF, AND PROCEEDINGS BEFORE, THE TRIBUNAL Jurisdiction and functions of the Tribunal 10.(1) The Tribunal has, except as provided by sections 29 and 32, exclusive jurisdiction to hear and determine proceedings referred to in sections 11 and 12. (2) The Tribunal has such other jurisdiction as may be conferred on it by or under any other Act. (3) The Tribunal has, wherever sitting, jurisdiction throughout New South Wales. (4) In any proceedings brought under section 11 or transferred under section 12, the Tribunal has the same power to make decisions as the Supreme Court would, but for this section, have had in relation to similar proceedings brought in the Supreme Court. (5) Subject to sections 13(6) and 14, a decision of the Tribunal has the same effect as, and may be enforced in the same way as, a decision of the Supreme Court. (6) In relation to proceedings within the jurisdiction of the Tribunal, the Tribunal has the functions of the Supreme Court under section 371(2) of the Companies (New South Wales) Code with respect to the stay of proceedings.

Claims for damages for dust diseases etc. to be brought under this Act 11. (1) If: (a) a person is suffering, or has suffered, from a dust-related condition or a person who has died was, immediately before death, suffering from a dust-related condition; and (b) it is alleged that the dust-related condition was attributable or partly attributable to a breach of a duty owed to the person by another person; and (c) the person who is or was suffering from the dust-related condition or a person claiming through that person would, but for this Act, have been entitled to bring an action for the recovery of damages in respect of that dust-related condition or death, proceedings for damages in respect of that dust-related condition or death may be brought before the Tribunal and may not be brought or entertained before any other court or tribunal (2) In subsection (1), a reference to a duty includes a reference to a duty imposed by statute as well as a duty imposed under the common law. (3) If the cause of action giving rise to proceedings to be brought under subsection (1) also gives rise to a claim in respect of some other matter, the claim may be included in those proceedings even though it does not relate to a dust-related condition from which a person is suffering or has suffered. (4) Any matter that is ancillary or related to a matter that is the subject of proceedings to be brought under subsection (1) may also be included in those proceedings. (5) In subsection (1) (c), the reference to a person claiming through a person who is or was suffering from a dust-related condition includes a reference to a relative for whose benefit an action may be brought under the Compensation to Relatives Act 1897. Transfer of proceedings from the Supreme Court or District Court to the Tribunal 12. (1) If: (a) on the commencement of this section, proceedings of the kind referred to in section 11 (1) are pending in the Supreme Court and the hearing of those proceedings has not begun; or (b) after that commencement, proceedings of that kind are brought or are pending in the Supreme Court, the registrar of the division of that Court in which the proceedings are pending or are brought must transfer the proceedings to the Tribunal, together with any ancillary or related matters. (2) If: (a) on the commencement of this section, proceedings of the kind referred to in section 11 (1) are pending in the District Court and the hearing of those proceedings has not begun; or (b) after that commencement, proceedings of that kind are brought or are pending in the District Court, the registrar of that Court for the place where the proceedings are pending or are brought must transfer the proceedings to the Tribunal, together with any ancillary or related matters. 16 Section 3(1) contains the following definitions: "ancillary or related matter" , in relation to any proceedings, includes any claim relating to the subject-matter of the proceedings that a defendant in the proceedings has against another person, whether that other person is a party to the proceedings or not. "decision" includes judgment, order and ruling. 17 CSR argues that the cross claims are ancillary or related matters referred to s 11(4) and as such, one having been "brought" prior to the entry of judgment for the plaintiff in the Welch proceedings and one after such entry, were "included" in the proceedings brought by the plaintiff under s 11(1). CSR submitted that by reason of s 10(1), this Court does not have any jurisdiction to hear and determine the cross claims as exclusive jurisdiction has been conferred upon the Tribunal. 18 James Hardie submitted that exclusivity attaches only to the proceedings under s 11(1), "the proceedings for damages" brought by the plaintiff. Mr Gee submitted that the deprivation of the Supreme Court's jurisdiction must be by clear and express language, a canon of interpretation he drew from Law Society of New South Wales v Weaver (1974) 1 NSWLR 271 per Reynolds JA, for the Court, at 272: It is a principle of statutory construction that a superior court of law will not be deprived of jurisdiction except by express words or necessary implication. The provision of another tribunal would not of itself ordinarily be sufficient to do so.

Mr Gee submitted that there are no clear or express words in the Act or necessary implication from the words in the Act from which a conclusion could be reached that this Court has been deprived of jurisdiction to hear ancillary or related matters brought or to be brought under s 11(4) of the Act. 19 Section 11(1) of the Act provides that "proceedings for damages" in respect of dust related conditions or death "may not be brought or entertained before any other court or tribunal". It seems to me that s11(3) permits a plaintiff in proceedings "to be brought" under s 11(1) to include a claim "in respect of some other matter", a non dust-related condition, in such s11(1) proceedings if the claim arises out of the same cause of action. 20 There are then the matters "ancillary or related" to a matter that is the subject of s11(1) proceedings. In Seltsam Pty Ltd v Energy Australia (1999) 17 NSWCCR 720 Giles JA discussed such matters as follows: 33. … The definition of "ancillary or related matter" demonstrates that a claim by a defendant in the proceedings against a third party may be included in the proceedings. Such a claim will necessarily be included in the proceedings after the proceedings have been commenced. The claimants argued that "to be brought" meant " to be heard " or "to be determined" , so that the condition cannot be fulfilled following the entry of judgment. The phrase does not have that meaning on an ordinary reading, and to give it that meaning would not be consistent with the reference to "proceedings brought" as distinct from "transferred" in s 10(4) (indeed, on the claimants' argument the transferred proceedings would also be proceedings to be brought), or with the reference to proceedings "brought" as distinct from "entertained" in s 11(1). The phrase must be read as part of the wider phrase in s 11(4), "a matter that is the subject of proceedings to be brought", with the function of identifying the matter as that which is embodied in the proceedings when brought but not of imposing the impossibility of including an ancillary or related matter in proceedings still to be commenced. The first opponent's cross-claim is a matter that is ancillary or related to a matter so identified. 21 Giles JA did not decide whether the Tribunal's jurisdiction in respect of ancillary or related matters is exclusive because in that case it was unnecessary. However Fitzgerald JA did express a view on this topic as follows: 60. It is necessary to have regard to the special position of the Dust Diseases Tribunal, and the source, nature and extent of its jurisdiction to determine a cross-claim for indemnity or contribution under subs 5(1)(c) of the LR Act. Unlike the Supreme Court, the Tribunal has no jurisdiction to adjudicate upon a claim for indemnity or contribution under s 5(1)(c) of the LR Act except as "ancillary or related" to a proceeding under s 11(1) of the Dust Diseases Tribunal Act (see s 11(4) and definition of "ancillary or related matter" in s 3), and, when it has jurisdiction in relation to such a cross-claim, the Tribunal's jurisdiction is exclusive: s 4, s 10(1) s 11. 61. In my opinion, s 11(4) of the Dust Diseases Tribunal Act only permits the institution of an "ancillary or related matter" including a cross-claim under s 5(1)(c) of the LR Act, when there is an extant proceeding under s 11(1) of the Dust Diseases Tribunal Act in the Tribunal to which the cross-claim can be "ancillary or related". Absence such proceeding under s 11(1) to which an "ancillary or related matter" may be appended, the legislature has understandably not sought to oust the jurisdiction of the Supreme Court and other Courts which can broadly be described as Courts of general jurisdiction. There was no reason to do so in order to achieve the primary statutory purpose of ensuring a prompt determination of claims the dust-related injuries by a specialist tribunal: Dust Diseases Tribunal Act, s 25(3). 22 In James Hardie & Coy Pty Ltd v Barry & Anor; Seltsam Pty Ltd v Barry & Anor [2000] NSWCA 353 Mason P, in dealing with the cross vesting legislation rejected a submission that the Tribunal could exercise jurisdiction under the Cross Vesting Scheme, went on to say: 61 The plaintiff would construe the words " related to " in s 11(4) of the DDT Act with all the scope of a grant of legislative power. He then seeks to draw down upon "related" proceedings, whether actual or potential, the scope of exclusivity conferred by s 10(1) upon claims falling within s 11(1) of that Act. Section 3(1) of the DDT Act defines " ancillary or related matter " to include any claim relating to the subject-matter of the proceedings that a defendant in the proceedings has against another person, whether that other person is a party to the proceedings or not. This would pick up claims for contribution against tortfeasors and disputes about insurance cover. 62. But it is an entirely different thing to say that such an ancillary or related matter falls within the preclusion of s 10(1) as soon as the original plaintiff and defendant are at issue on the substantive claim and even before the defendant makes any ancillary or related claim in the Tribunal. It is clear that s 10(1) was introduced to ensure that, within New South Wales at least, particulars types of dust-related claims were litigated at trial only in a specialist tribunal. But it does not follow that the pendent jurisdiction which " may " be added pursuant to s 11(4) falls within the same dispensation. Section 12 of the DDT Act reinforces this reasoning. 23 Although CSR relied upon this portion of Mason P's judgment in support of its submission that the Tribunal has exclusive jurisdiction over s11(4) matters that are included in s11(1) proceedings I am not of the view that it is supportive of such a submission. The learned President was in my view cautioning against such a conclusion when he said that it did not follow that those ancillary matters that "may" be added , or included, fell within the same "dispensation". By the use of the term "dispensation" in this context I understand the learned President to have meant that it does not follow that s11(4) matters may be litigated "only in a specialist tribunal" - the Tribunal. 24 Mason P was of the view that s11(4) matters would include claims for contribution against joint tortfeasors and disputes about insurance cover. In Carnuccio v Cinzano (1990) 6 NSWCCR 70 O'Meally J was dealing with an application by a defendant for leave to file and serve cross claims against three insurers during s 11(1) proceedings brought against the defendant by a former employee. His Honour said at 73; It seems to me that "the subject-matter of the proceedings" is sufficiently wide an expression as to include claims of the type made by the defendant in its cross claim against the insurers and accordingly the Tribunal does have jurisdiction to determine the questions and if appropriate to make the declarations sought in the cross claims. This jurisdiction, in my view, is not exclusive and questions involving the liability of insurers to indemnify policy-holders are questions which could be dealt with also in the Supreme Court. It is not difficult to image that in proceedings transferred to or initiated in this Tribunal considerations of urgency would require the hearing of a plaintiff's claim to be conducted with all possible despatch and within a time-frame which would render it impracticable if not impossible for a defendant or defendants to have other questions which might be involved brought under the umbrella of those proceedings. 25 The view expressed by O'Meally J in the first paragraph of this extract is consistent with the view expressed by the Court of Appeal of this Court in Mangion v James Hardie & Co Pty Limited (1990) 20 NSWLR 100 per Samuels AP at 105E with whom Clarke JA agreed at 113. 26 Mr Taylor made detailed submissions in respect of the term "matter" relying on the reasoning of the High Court in Fencott v Muller (1982 -1983) 152 CLR 570 (particularly per Gibbs CJ at 591-592 and Mason, Murphy, Brennan & Deane JJ at 603-608) and Stack v Coast Securities (No.9) Pty Ltd (1983) 154 CLR 261 (particularly per Gibbs CJ at 281-282; Mason, Brennan & Deane JJ at 294-295 and Wilson & Dawson JJ at 308). 27 In Stack the Court was interpreting the terms of the then s86 S 86 provided: Jurisdiction is conferred on the Court to hear and determine actions, prosecutions and other proceedings under this Part and that jurisdiction is exclusive of the jurisdiction of any other court, other than the jurisdiction of the High Court under section 75 of the Constitution. of the Trade Practices Act 1974. Mr Taylor distinguished s86 from the section I am interpreting by emphasising the word "that" before the word jurisdiction in s 86. It was submitted that none of the ways in which James Hardie has asserted its entitlement to contribution in the present proceedings is relevantly severable from the "matter" that was included in the Welch proceedings. 28 Mr Gee cautioned me against approaching the interpretative task in this case by reference to the conceptual framework of "eighty years of encrustation" on the term "matter". In support of a submission that I should put aside the approach advocated by Mr Taylor, Mr Gee relied upon Gleeson CJ's judgment (with which Meagher JA agreed) in National Parks and Wildlife Service & Anor v Stables Perisher Pty Ltd (1990) 20 NSWLR 573 in which his Honour said at 580: ..references to, and analogy with, the "pendent" or "accrued" jurisdiction of the Federal Court are apt to mislead, when the subject under consideration is the jurisdiction of the Land and Environment Court. Further, in the present context, where the issue is whether that court has a certain jurisdiction, a reference to a supposed "pendent jurisdiction" is question-begging. It does not advance the argument. It simply describes the result for which one party is contending.

29 In this case I am considering the nature of the jurisdiction of the Tribunal to hear s11(4) matters. Having regard to the above observations made by Gleeson CJ I am of the view that the High Court's consideration of the matters in Fencott v Muller and Stack do not assist me in this case. 30 Section 10(1) of the Act provides that the Tribunal has exclusive jurisdiction to hear and determine "proceedings referred to in sections 11 and 12". The only "proceedings referred to" in s11 are "proceedings for damages" in s11(1). The reference to "proceedings" in s11(3) and s11(4) are specifically references back to s11(1) proceedings. 31 "Matters" may be included in s 11(1) proceedings pursuant to ss11(3) & (4) however those matters are not labelled "proceedings" in s11. It seems to me that the legislature has carefully labelled them as a "claim in respect of some other matter" in s11(3) and a "matter that is ancillary or related" in s11(4). If it had been intended to include such "matters" in the exclusive jurisdiction of the Tribunal the legislative pen need only have inserted the word "proceedings" instead of "claim" in s11(3) and instead of "matter that" where first appearing in s11(4) of the Act. 32 The only "proceedings referred to" in s12 of the Act are "proceedings of the kind referred to in section 11(1)". The Registrar is required to transfer those "proceedings" to the Tribunal "together with any ancillary or related matters". It seems to me that the legislature was careful to separate these matters from the "proceedings" in this context. They are not referred to as "proceedings" even though it may well have been that such "matters" were already the subject of a cross claim in the Supreme Court. 33 Mr Taylor submitted that once the s11(4) matters are "included" in the s11(1) proceedings they become part of those proceedings over which the Tribunal has exclusive jurisdiction and thus the Tribunal has exclusive jurisdiction over these matters once included. Certainly Fitzgerald JA's observations in Seltsam support this view however, although it may be concluded that reasonable minds might differ in respect of this matter, his Honour was not required in that case to focus upon the language of each of ss10,11 and 12 of the Act. 34 I am of the view that the reservation of ancillary and related matters from the label "proceedings" in ss11 and 12 is indicative of an intention that the exclusive jurisdiction of the Tribunal is limited to the proceedings for damages referred to in s11(1) of the Act. I am also of the view that exclusivity is not intended to be triggered by the inclusion of ancillary and related matters. 35 The intention of the legislature seems to me to have been to provide an exclusive jurisdiction for the hearing and determining of claims for damages for injury or death attributable to dust-diseases and dust related conditions in a specialist Tribunal with the capacity to fast track those proceedings. It is clear beyond doubt that the legislature also intended the Tribunal to have jurisdiction to hear the claims the subject of the Cross claims in the Welch proceedings. 36 However it is my view that it was also intended that the Tribunal should not be burdened with the requirement to hear all cross claims once included in the s11(1) proceedings. That would be totally against the purpose of the creation of this Tribunal to be free to hear the claims for damages urgently if necessary and as promptly as possible in any event. 37 The exclusion of the ancillary or related matters from the exclusive jurisdiction in my view was intended to create the flexibility for the Tribunal to hear the cross claims if it deems it "appropriate", or allow other Courts to take the "burden" away so that the Tribunal can get on with the hearing of the proceedings for damages the essential purpose for which it was created. 38 I am satisfied that this Court has jurisdiction to hear these proceedings. The trial will therefore proceed.

Last Modified: 04/11/2001 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.

(2001) 21 NSWCCR 637

(1999) 17 NSWCCR 720

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