BI (CONTRACTING) PTY LTD v P H R PTY LTD

Civil Liability Act 1936 (SA) LEGISLATION CITED: Dust Diseases Tribunal Act 1989 Law Reform (Miscellaneous Provisions) Act 1946 (NSW) s5

BI (Contracting) Pty Ltd v Strikwerda [2005] NSWCA 288 CASES CITED: BI (Contracting) Pty Ltd v Myer Emporium Limited [2005] NSWCA 305 Williams v BI (Contracting) Pty Ltd & Anor [2004] NSWDDT 19

BI (CONTRACTING) PTY LTD PARTIES: PHR PTY LTD

Appellant: J J E Fernon SC COUNSEL: Respondent: M Neil QC/ G Rundle

Appellant: Makinson & d'Apice SOLICITORS: Respondent: Thompson Cooper

LOWER COURT JURISDICTION: Dust Diseases Tribunal

DDT 7/04 LOWER COURT FILE NUMBER(S): DDT 118/04

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA40935/2004 CA40936/2004 DDT 7/2004 DDT 118/2004

MASON P HANDLEY JA WINDEYER J

BI (CONTRACTING) PTY LIMITED v PHR PTY LIMITED JUDGMENT 1 MASON P: This appeal from the Dust Diseases Tribunal is restricted to points of law or questions as to the admission or rejection of evidence (Dust Diseases Tribunal Act 1989, s32). 2 The late Mr Hans Strikwerda was employed by the respondent (PHR) between 1964 and 1968 as a pipe fitter welder. In that employment he was exposed to asbestos dust and fibre during the time when PHR was a sub-contractor engaged to do plumbing and air-conditioning work on the construction of the Royal Adelaide Hospital. 3 The appellant (BI) was also a sub-contractor, engaged to spray asbestos material on beams and girders. 4 The deceased was exposed to crocidolite asbestos that came from material being sprayed by BI. As a consequence he contracted mesothelioma that led to his death on 5 April 2004. 5 The claims brought by the deceased (subsequently his estate) alleged negligence in the failure to warn or protect the deceased against the risks stemming from inhaling asbestos dust. The claims against the defendants were settled except for one portion of the damages. The judgment on that matter has been the subject of a separate appeal (see BI (Contracting) Pty Ltd v Strikwerda [2005] NSWCA 288). 6 The cross-claims for contribution were litigated in Adelaide. Since the place of the tort was South Australia the governing statute was s25 of the Wrongs Act 1936 (SA), subsequently renamed the Civil Liability Act 1936 (SA). The provision is not materially different from s5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).

Challenge to admission of evidence 7 Section 25(3) of the Dust Diseases Tribunal Act provides: Historical evidence and general medical evidence concerning dust exposure and dust diseases which has been admitted in any proceedings before the Tribunal may, with the leave of the Tribunal, be received as evidence in any other proceedings before the Tribunal, whether or not the proceedings are between the same parties.

8 One issue relevant to the apportionment exercise was ascertaining what it was that the appellant knew or ought to have known between 1964 and 1968 relevant to the dangers of asbestos. 9 There had been proceedings in the Tribunal, heard by O'Meally P called Williams v BI (Contracting) Pty Ltd & Anor [2004] NSWDDT 19 (DDT 262/2002). Mr P J Snelling was called in those proceedings as a witness for the plaintiff. He had been a manager of BI Spraying Pty Ltd prior to 1962. The company operated from premises in Adelaide that were shared by the appellant company. 10 Mr Snelling's oral evidence showed that he was familiar with the work of the appellant during the time he worked for the related BI company. He said that he had responsibility for spraying work (CB 91). Mr Snelling gave evidence about the mixing and bagging of blue asbestos cement as well as the work practices in the early 1960s when asbestos was sprayed under his supervision. 11 Mr Snelling said that it was his job to insist that the BI workers always wore a face mask in the form of a white cloth over their nose. He said that "unfortunately that would only last about 5 minutes before it became fairly intolerable and as soon as I left the site I knew that they used to take the masks off" (CB 94). The following evidence was given: Q. Were you told why they should wear such a mask. A. Yes, I can remember when I first started there John Kurnow gave me a - I think it was either a book or a pamphlet which was by Johns Mansville and it was pointing out the dangers of the asbestos and that they should wear these masks, and John Kurnow said, well, it's up to me to make sure that they continually wear them but he knew and I knew that that was impossible. Q. What did you believe might occur to a man who was inhaling asbestos. A. Well, at that stage I believed that mesothelioma, as I know it today, I believed then that it was caused by the long asbestos fibres. I had no idea it was the dust that caused the problem. So I didn't really appreciate the real dangers and I certainly wasn't told that death was inevitable, as I now believe. 12 One would have thought that this amply demonstrated relevant actual knowledge of the risks stemming from unprotected exposure to the air-borne asbestos being sprayed. A fortiori in light of earlier evidence from Mr Snelling that it was, "very polluted" around the sprayers, with about 25% of what was being sprayed ending up ultimately on the ground or on the sprayer (CB 93). 13 This evidence was tendered and admitted in the instant proceedings. Its admission is not in dispute in this appeal. 14 Mr Snelling was an available witness if additional oral testimony was required. 15 Also admitted in the tribunal below was an affidavit of Mr Snelling sworn 19 June 2002 and prepared for filing in the Williams proceedings (CB 78-82). It is difficult to see what the affidavit added to Mr Snelling's oral evidence in the Williams proceedings, and this may explain why it may possibly not have been read in those Williams proceedings (see below). 16 Portion of the Snelling affidavit lists a number of other jobs involving the spraying of asbestos by one of the Bradford companies (CB 80B-K). It would appear that this paragraph may be the reason for the appellant pressing in this Court the strange ground of appeal that I am about to explain. 17 At trial in the present proceedings it was counsel for PHR, Mr Rundle, who sought to tender the Snelling affidavit. It was Mr Rundle's understanding at the time that that affidavit had been read in the Williams proceedings. O'Meally P was so informed (CB 67) and this was never disputed by Mr O'Dowd, BI's trial counsel. 18 The affidavit was objected to by Mr O'Dowd on the basis that prior intention to use it had not been notified in accordance with what we were told is the practice in the Tribunal. Since s25(3) requires that the Tribunal give leave for evidence admitted in other proceedings to be received as evidence in the instant proceedings, Mr O'Dowd was entitled to ask his Honour to refuse leave in the exercise of this statutory discretion. Be that as it may, the question of prior notification and/or leave under s25(3) is not the issue raised in the current appeal. 19 The affidavit was admitted (CB 70), followed shortly by the admission of the transcript of Mr Snelling's evidence in the Williams case. 20 The point now taken is that the Snelling affidavit should not have been received into evidence in the instant trial by O'Meally P because, unknown to all concerned at the time, it had not been read or otherwise admitted into evidence in the Williams proceedings. 21 As indicated, it was conceded before O'Meally P that the Snelling affidavit had been admitted into evidence in the Williams proceedings. There was therefore a proper basis for the decision to allow the affidavit to be received into evidence in the instant proceedings, in accordance with s25(3). 22 In this Court the appellant has filed recently sworn affidavits to the effect that recent searches indicate that the Snelling affidavit prepared for use in the Williams proceedings was not in fact read or tendered in those proceedings. In support of a favourable exercise of this Court's discretion to receive those affidavits the appellant argues, with force, that the very fact that the Snelling affidavit was sprung on it without warning means that it ought to be allowed the opportunity to correct later-discovered wrong assumptions about it. It is not suggested that Mr O'Dowd had appeared for the appellant in the Williams proceedings. Even if he had, he might be excused for having no instantaneous recollection as to whether Mr Snelling's oral evidence had been supplemented by the reading of the affifdavit. 23 I would nevertheless refuse leave to rely on this material and would dismiss this ground, for the following reasons:

(1) Senior counsel for the appellant pointed out at the start of his submissions that nothing in the Snelling affidavit has any significance for the instant appeal (CA Tr p13);

(2) If there is anything in the Snelling affidavit that would impact materially upon BI's interest in some future case before the Tribunal, then that case is the proper venue to present the argument that the appellant wishes to press in the instant appeal. That argument can take place in a context where both sides have had the opportunity to explore whether or not the Snelling affidavit was actually read in the Williams proceedings. They may discover that it was read in some other proceedings (cf CB 67R). They may also find that Mr Snelling is available to give evidence in person. 24 This point should not have been pressed. Whatever its merit, it is entirely academic in the present appeal. 25 If, on further investigation, it turns out that the Snelling affidavit was not properly admitted in the Strikwerda proceedings at first instance, then I see no basis on which such admission would bind the Tribunal in later proceedings if it were the only basis upon which the Snelling affidavit was pressed for admission pursuant to s25(3) in those other proceedings.

Challenge to apportionment 26 O'Meally P approached the apportionment exercise by posing the issue as being that of determining the "relative culpability" of the respective defendants. 27 His Honour proceeded to find that BI had actual knowledge of the dangers of asbestos whereas PHR did not know, but should have known, of those dangers. His Honour continued: In determining the relative culpability of each of BI and PHR it is relevant to consider not only the fact that BI had actual knowledge of the dangers of asbestos and that PHR ought to have known of them, but also the size; and nature of the operations of each. BI's business consisted in spraying asbestos mixed with cement and water in buildings during the course of their construction to act as a fire retardant in the event that a fire occurred. PHR began its operations as a "sewerage plumber", but later it specialised in the installation of pipes which would carry hot water, steam and medical gases. During the course of the construction of the Royal Adelaide Hospital PHR had something in the order of 30 or more employees present at the site, though the number fluctuated depending upon the nature of the work being carried out at any particular time. It had a total of 70 employees. It was thus not a small enterprise and the evidence demonstrates that it professed some expertise in the tasks upon which it was engaged. Considering that BI had actual knowledge and its sole enterprise, unlike that of PHR, was working with asbestos it is my view that BI ought to bear the large proportion of the liability to the plaintiff. Mr O'Dowd has suggested that its liability should be something in the order of 50 per cent and in that respect he has reminded me of the decision in BHP Billiton Ltd v Amaca Pty Ltd [2003] NSWDDT 18. In that case liability was apportioned between an employer and a supplier of asbestos products as to 50 per cent each. It is important however, to remark that the employer there was one of the largest, if not the largest corporation in Australia, and there was why its liability to contribute to the damages awarded to the plaintiff was assessed at 50 per cent. Doing the best I can to do justice between the parties it is my view that BI should bear 80 percent of the liability to satisfy the plaintiff's damages and PHR should bear 20 per cent. 28 The appellant's primary written submission was to the effect that it was irrelevant to give any weight to the difference between the state of knowledge of the two defendants. This point was abandoned in circumstances referred to in the judgment in BI (Contracting) Pty Ltd v Myer Emporium Limited [2005] NSWCA 305. 29 What was left proved on analysis to be no more than an endeavour to persuade this Court to exercise the discretion afresh. 30 It was faintly put that there had been no consideration of the degree of "causal potency" as regards the separate tortfeasors. But liability stemmed in each case from a complete failure to warn or protect the deceased. No submissions appear to have been advanced at trial under the "potency" rubric. The arguments were focused on what was described as the issue of "relative culpability". It is not suggested that the matters actually taken into account in the portion of the judgment set out above were irrelevant to the apportionment exercise. 31 There was reference in the written submission to the non-delegable nature of the employer's duty. The point is also addressed in this Court's reasons in the companion appeal. 32 This appeal should be dismissed with costs. 33 HANDLEY JA: I agree with Mason P. 34 WINDEYER J: I agree with Mason P. **********

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