BLACKBURN v ALLIANZ AUSTRALIA INSURANCE LTD

LOWER COURT District Court JURISDICTION : LOWER COURT 154/00 (Wollongong) FILE NUMBER(S) : LOWER COURT Goldring DCJ JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40121/04 DC 154/04 (Wollongong)

MASON P SHELLER JA HODGSON JA

BLACKBURN v ALLIANZ AUSTRALIA INSURANCE LTD On 26 December 1997, the claimant suffered serious injuries in a motor vehicle accident as a passenger in a motor vehicle driven by her mother. She was seven years old at the time of the accident.

The claimant's mother commenced proceedings to recover damages for herself within the time period stipulated by s52(4) of the Motor Accidents Act 1988 ('the Act'). Those proceedings were heard and judgment was given in favour of the mother in early 2002. However, proceedings were not commenced by the claimant within the time specified by the Act, because the solicitor acting for the plaintiff, Ms Walsh, was under a serious misapprehension as to the limitation period applicable to infants in motor vehicle accident claims.

An application was made to commence proceedings out of time on 3 September 2003. This application was refused by Judge Goldring on the grounds that the want of forensic diligence was so great that it would be unreasonable for the Court to exercise its discretion in the claimant's favour.

The claimant applied to this Court for leave to appeal the decision of Goldring DCJ. The claimant submitted that the trial Judge erred in failing to take account of the lack of prejudice to the respondent, the fact that the proceedings would not have finalised in any event if commenced in time and the significance of the opponent's willingness to negotiate. It was contended that these factors outweighed the impact of the lack of forensic diligence. The opponent, by way of a notice of contention, supported the correctness of the decision of Judge Goldring and submitted that the claimant failed to provide a full and satisfactory explanation to the Court for the delay by her solicitor as required by s54(4B) of the Act. Held in relation to forensic diligence:

Per Sheller JA, Mason P and Hodgson agreeing:

1. When Gleeson CJ in Salido v Nominal Defendant (1993) 32 NSWLR 524, spoke of 'forensic diligence' his Honour was speaking of diligence in the sense given to that word in the Macquarie Dictionary namely, "constant and earnest effort to accomplish what is undertaken", accompanied by reasonable care.

Riverstone Meat Co Pty Ltd v Lancashire Shipping Co Ltd (1960) 1 All ER 193 applied.

2. Ms Walsh attended in general terms to the steps necessary for the preparation of the case. The problem was not so much any want of forensic diligence by Ms Walsh but her ignorance of the impact upon her client of the limitation provisions in the Act. Held in relation to the meaning of a "full" explanation within s40(2) of the Act:

Per Sheller JA, Mason P and Hodgson agreeing: 3. The meaning of a "full and satisfactory explanation" as described in s40(2) of the Act and required by ss42(4), 43A(2), (4), (6a) and (7) as well as s52(4B) is not clear and has been understood differently in several cases.

Russo v Aiello (2003) 77 ALJR 1775 considered; Mancini v Thompson [2002] NSWCA 38 considered; Diaz v Truong (2002) 37 MVR 158 applied; Manderson v Ellis (2002) 37 MVR 214 considered; Guest v Southern (unreported) NSWSC Studdert J 22 September 1995 considered; Buller v Black (2003) 56 NSWLR 425 considered.

4. In order to satisfy the requirements of s52(4B)(a) of the Act, the explanation the claimant provides to the Court for the delay must be full and complete so that the Court can evaluate all the reasons for the delay.

5. Ms Walsh gave oral evidence and she was vigorously cross-examined as to her explanation for the delay. While the cross-examination was directed to Ms Walsh's conduct as a solicitor, none of it detracted from the completeness of the explanation. The difficult question was whether that explanation was a satisfactory explanation.

Held in relation to the meaning of a "satisfactory" explanation within s40(2) of the Act: Per Sheller JA, Mason P and Hodgson JA agreeing: 6. In Diaz v Truong, Hodgson JA and Foster AJA agreed as to the result of the appeal but had some disagreement as to the construction of s40(2) of the Act, particularly in relation to whether the question of the satisfactoriness of the explanation was confined to the requirements of the second sentence of s40(2).

7. It was not necessary to resolve this issue in this case. Neither the claimant nor her mother were in any way responsible for the failure to institute proceedings within time. Whether the expression 'in the position of' in s40(2) embraces only the claimant herself or embraces also her mother, the posited 'reasonable person' would have been justified in experiencing the same delay since neither knew anything about the limitation period or the need to make the application until 1 September 2003, two days before the application was filed.

8. Therefore, applying the test in Diaz v Truong as articulated by Hodgson JA or Foster AJA, the explanation was, within the meaning of s40(2) satisfactory.

Per Hodgson JA, Mason P agreeing: 9. The second sentence of s40(2) does not in terms make its fulfilment sufficient to make a full explanation a satisfactory one. However, if the delay experienced by the claimant is one which a reasonable person in the position of the claimant would have been justified in experiencing, and if a full explanation is given by the claimant and her advisers, it is difficult to envisage any circumstance in which the explanation would not be considered full and satisfactory.

10. Therefore in Diaz v Truong, while as a matter of language Foster AJA was correct, there was no practical difference between our positions on the matter.

11. It was not necessary in this case to resolve whether "reasonable person in the position of the claimant" as stipulated by s40(2) leaves out of account a claimant's tender year or perhaps brain damage. However, it is unlikely that the legislature intended s40(2) to promote legal proceedings by a child against its uninsured parents. Per Mason P:
12. Differing views have been expressed as to the juristic nature of a primary decision as to whether or not a claimant gave a full and satisfactory explanation. Russo v Aiello (2003) 77 ALJR 1775 considered; Buller v Black (2003) 56 NSWLR 425 at 433 affirmed.

Buller v Black (2003) 56 NSWLR 425 Diaz v Truong (2002) 37 MVR 158 Guest v Southern (unreported) NSWSC Studdert J, 22 September 1995 House v The King (1936) 55 CLR 499 James v Commissioner for Railways (1963) 63 SR (NSW) 373 Laidlaw v Touma [2002] 36 MVR 388 Mancini v Thompson [2002] NSWCA 38 Manderson v Ellis (2002) 37 MVR 214 Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 Moran v McMahon (1985) 3 NSWLR 700 O'Brien v O'Brien (1995) 35 NSWLR 664 Repco Corp Ltd v Scardamaglia (1996) 1 VR 7 Riverstone Meat Co Pty Ltd v Lancashire Shipping Co Ltd (1960) 1 All ER 193 Russo v Aiello (2003) 77 ALJR 1775 Salido v Nominal Defendant (1993) 32 NSWLR 524

ORDERS 1. Grant leave to appeal; 2. Appeal allowed; 3. Set aside the order of Judge Goldring; 4. Grant leave to the claimant by her tutor to commence proceedings in respect of this claim within twenty-eight days of the making of this order; 5. The opponent to pay the claimant's costs of the hearing before Judge Goldring and of this application and appeal but in respect of the application and the appeal to have a certificate under the Suitors' Fund Act 1951 if so entitled.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40121/04 DC 154/03 (Wollongong)

MASON P SHELLER JA HODGSON JA

Monday, 22 November 2004 BLACKBURN v ALLIANZ AUSTRALIA INSURANCE LTD Judgment 1 MASON P: I agree with Sheller JA and the additional remarks of Hodgson JA. 2 Differing views have been expressed as to the juristic nature of a primary decision as to whether or not a claimant gave a full and satisfactory explanation. The issue may assume importance as regards the standard for appellate review, although I hasten to add that it does not do so in the present matter. 3 In Russo v Aiello (2003) 77 ALJR 1775 there are, on my reading, different views as to the issue, none of them forming part of the ratio decidendi. McHugh J at [27] states that the decision is discretionary such that appellate review must satisfy the principles of House v The King (1936) 55 CLR 499. Kirby J (in dissent) appears to be a like view (see at [111]. Gummow and Hayne JJ appear to speak in different terms (at [61]). Gleeson CJ does not appear to advert to the particular issue. 4 I remain most respectfully in disagreement with McHugh J, my view being as stated in Buller v Black (2003) 56 NSWLR 425 by myself at 433-434[37]-[38] (the correct citation for Wu Shan Liang's Case being 185 CLR 259 at 275-6); and by Giles JA (with whom Ipp JA agreed) at 442[96]. 5 SHELLER JA:

Kate Blackburn, by her tutor, who is her mother Felicity Blackburn, applies for leave to appeal from a decision of Goldring DCJ refusing leave, pursuant to s52(4) of the Motor Accidents Act 1988 (the Act), to the claimant to commence proceedings out of time. The claimant suffered serious injuries in a motor vehicle accident, which occurred on 26 December 1997, when she was a passenger in a motor vehicle driven by her mother. At the time of the accident the claimant was seven years old. The opponent, Allianz Australia Insurance Limited, was the proposed defendant in the proceedings. 6 Section 52(4) is in Part 5 of the Act. Part 5 is concerned with claims and court proceedings to enforce claims. A claim is defined in s40(1) as a claim for damages in respect of injury to a person caused by the fault of the driver of a motor vehicle in the use or operation of the vehicle. Section 52(4) provides, so far as presently relevant: "(4) A claimant is not entitled to commence proceedings in respect of a claim more than three years after: (a) the date of the motor accident to which the claim relates … except with the leave of the court in which the proceedings are to be taken." 7 Subsections 52(4B), (4C) and (5) of the Act provide: (4B) The leave of the court must not be granted unless: (a) the claimant provides a full and satisfactory explanation to the court for the delay, and

(b) the total damages of all kinds likely to be awarded to the claimant if the claim succeeds are not less than 25 per cent of the maximum amount that may be awarded for non-economic loss under s79 or 79A as at the date of the relevant motor accident. (4C) Section (4B)(b) does not apply to a claimant who is legally incapacitated because of the claimant's age or mental capacity. (5) The Limitation Act 1969 does not apply to or in respect of proceedings in respect of a claim." 8 Section 40(2) of the Act provides that in Pt 5 a reference to a full and satisfactory explanation by a claimant for non-compliance with a duty or for delay is a reference to a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant would have failed to have complied with the duty or would have been justified in experiencing the same delay. The word "claimant" in Pt 5 is defined in s40(1) as meaning "a person who makes or is entitled to make a claim". In the present case, the claimant did not commence proceedings within the prescribed three-year period. She applied by her tutor for leave to do so on 3 September 2003.

Judge Goldring's reasons for judgment 9 In his reasons for judgment, Judge Goldring found that a claim was completed on behalf of the plaintiff by her next friend on 27 January 1998, well within the six-month period allowed by s43 of the Act, and that the insurer entered into correspondence with the solicitors acting for the plaintiff, which had continued to the date of hearing. The plaintiff had continued to receive treatment. His Honour accepted that her condition was not yet stable so that she was not in a position to contemplate a settlement, nor was her mother and next friend. Her mother began proceedings to recover damages for herself within the time limit allowed by s52(4). Those proceedings were heard and judgment was given in the mother's favour at the beginning of 2002. 10 Judge Goldring said that the application for leave to commence proceedings out of time was brought because Ms Walsh, a solicitor, who at all relevant times acted for the plaintiff, while employed at two firms of solicitors, Kell Heard McEwan until May 2000 and Turner Freeman thereafter, did not become aware until early in 2002 that she was under a serious misapprehension as to the limitation period applicable to infants in motor vehicle claims. She had been under the impression that the limitation period in such cases did not expire until the plaintiff turned eighteen; compare ss52 and 11(3) of the Limitation Act 1969. His Honour found that Ms Walsh, as soon as she realised that she was mistaken, set about to do what in her mind was the best thing to remedy the situation. She did not immediately notify the next friend or her husband, but as his Honour said, although this was unfortunate, it was not the real issue in the case. 11 Judge Goldring referred to Salido v Nominal Defendant (1993) 32 NSWLR 524, where this Court (Gleeson CJ, Kirby P and Powell JA) considered various provisions of the Motor Accidents Act including s52(4). At 531-3 Gleeson CJ said: "With all respect to the argument that was put to McLachlan DCJ and accepted by him, the proposition that leave under s52(4) should not be given lightly is one that provides little assistance. It cannot be intended to be taken literally; what kind of judicial discretion would be exercised lightly? Presumably its forensic purpose is cautionary, and one can hardly take exception to that. Even so, proceeding with all proper caution, the court must exercise the statutory discretion in a judicial manner. The proposition that an applicant 'must show something truly special or extraordinary' adds a gloss to the statute which alters its meaning and effect. It is true that, in Hall v Nominal Defendant (1966) 117 CLR 423 at 445, Windeyer J, in a similar context, approved of a statement that said that a discretion could only be exercised where there are special circumstances which create a real reason why the statutory limitation should not take effect. However, his Honour referred to that proposition in the course of pointing out that time limits are prescribed for a purpose and, to set them aside, there must be something more than a belief that no harm might come of doing so. I see no reason to characterise the circumstances that might, in a given case, justify leave under s52(4) as necessarily extraordinary, or truly special. The question is what is fair and just. To take a simple example, delay in the outset of symptoms is a circumstance that might make it equitable to grant leave to commence proceedings out of time. Such delay happens from time to time, and in many cases it would be inappropriate to describe it as extraordinary, or truly special. It is true that the exercise of the discretion is to be approached on the basis that the onus is on the applicant to show why it is fair and just that in his or her case there should be a dispensation from a general rule established by the statute. Nevertheless, the statute recognises that there may be cases where it is fair and just to grant such a dispensation, and the applicant should not be required to bear some additional forensic burden of indeterminate nature and unquantified weight. To take up the words of Glass JA in McGee v Yeomans (1977) 1 NSWLR 273, it is not possible by judicial decision to establish in advance categories of case in which it would be fair and just to grant leave to commence proceedings out of time under s52(4). However the following guidelines may be of assistance in obtaining consistency of decision-making: 1. Section 52(4) confers a discretion which is to be exercised judicially, in a manner that furthers the purposes of the statutory context in which it appears. The immediate purpose, as with any limitation period, is to protect defendants against the injustice of stale claims; the statute is also aimed at promoting forensic diligence. 2. Bearing in mind those statutory purposes, the question is whether, in the circumstances of each individual case, the applicant for leave has demonstrated that it is fair and just that leave should be granted. 3. The diligence, or lack of diligence, shown by a plaintiff or a plaintiff's representatives, in ascertaining and asserting his or her rights will ordinarily be a material factor, as will the extent of the relevant delay, and the reason for it. 4. The nature and extent of any forensic disadvantage to a defendant resulting from a plaintiff's delay will also be material. The effect, if any, of the delay upon the defendant's ability to defend an action is a matter to be taken into account, and may in some cases be of decisive importance. 5. Leave under s52(4) may be refused if it would be plainly futile to grant it, and in that connection an applicant's willingness and ability to give a full and satisfactory explanation of any delays in reporting to police, notifying claims and commencing proceedings will be material."

In that case the Court regarded it as fair and just that the appellant should have leave to commence proceedings out of time. In 1995, after that decision, subsections 4B and 4C were added to s52 of the Act and s40(2) inserted. The new subsections came into force on 1 January 1996. 12 Judge Goldring referred to O'Brien v O'Brien by his tutor V L O'Brien (1995) 35 NSWLR 664 where this Court held, following James v Commissioner for Railways (1963) 63 SR (NSW) 373 at 378, that infants did not have a general charter of immunity from limitation provisions. In the absence of an express statutory provision the claimant is not immune from the limitations imposed by the Act. 13 Judge Goldring said it was clear from subsequent cases in this Court, such as Manderson v Ellis (2002) 37 MVR 214 and Diaz v Truong (2002) 37 MVR 158, that disability was a highly relevant factor in the exercise of the Court's discretion. However, in his Honour's view this was not so in a case where the want of forensic diligence was as clear as it was. His Honour said: "The existence and the nature of limitation periods are fundamentally important in legal practice and where a solicitor, through inexperience or misapprehension, and in this case Ms Walsh was both inexperienced, this being her first motor vehicle accident case, and she was inadequately supervised at all relevant times. She made an error which is fundamental."

His Honour said that he appreciated that the insurer was certainly in possession of a lot of relevant information because of the claim brought by the mother so that the prejudice was not as great as otherwise it would be but the want of forensic diligence was so great that it would be unreasonable for the Court to exercise its discretion in the plaintiff's favour. On that basis, the application was dismissed.

Discussion 14 It is notable that in his reasons for judgment, Judge Goldring referred to Manderson v Ellis and Diaz v Truong but made no mention of subs (4B) of s52 of the Act. Decisive in his Honour's opinion was the want of forensic diligence. When Gleeson CJ in Salido as quoted above, spoke of "forensic diligence" and the diligence or lack of diligence shown by a plaintiff or a plaintiff's representatives in ascertaining or asserting the plaintiff's rights, his Honour was speaking of diligence in the sense given to that word in the Macquarie Dictionary namely, "constant and earnest effort to accomplish what is undertaken", accompanied by the exercise of reasonable care: Riverstone Meat Co Pty Ltd v Lancashire Shipping Co Ltd (1960) 1 All ER 193 at 219. Ms Walsh attended in general terms to the preparation of the case by giving the necessary notice of intended claim, keeping in periodical contact with the claimant's mother, obtaining medical evidence and corresponding with the insurer and the insurer's solicitor. That correspondence extended past the expiry of the limitation period. The question of settlement was discussed. The problem was not so much any want of diligence by Ms Walsh but her ignorance of the impact upon her client of the limitation provisions in the Act. 15 The opponent seeks, if leave to appeal be granted, to support the correctness of Judge Goldring's decision on grounds set out in a draft notice of contention. The opponent submits that the claimant failed to provide a full and satisfactory explanation to the Court for the delay as required by s54(4B) of the Act. The opponent accepted that the account of the conduct of the claimant and her tutor was sufficiently full. However, Ms Walsh did not set out in any of her affidavits the fact that she consulted her supervising partner in relation to the expiry of the limitation period or the nature of the advice she received from her supervising partner. The opponent submitted that no explanation had been given as to why proceedings were not commenced at the latest on 30 July 2003 when Ms Walsh spoke to her supervising partner. She said that she did not begin proceedings immediately after that date because she considered that before she could do so she needed to provide particulars pursuant to s50A of the Act and then wait ninety days. 16 Section 50A provides that subject to s52(1A) a claimant is not entitled to commence court proceedings against another person in respect of a claim until the claimant has given the other person's insurer full details of the injuries sustained by the claimant, all disabilities and impairments arising from those injuries, if those injuries, or any of them, have not stabilised, the prognosis for future recovery and any economic losses and other losses that are being claimed as damages "sufficient to enable, the insurer, as far as practicable, to make a proper assessment of the claimant's full entitlement to damages." Relevantly, s52(1A) provides: "A claimant is not entitled to commence court proceedings against another person in respect of a claim until: … (b) 90 days have elapsed since the details required by s50A were given to the other person's insurer. …"

A full and satisfactory explanation 17 The meaning of "a full and satisfactory explanation" as described in s40(2) of the Act and required by ss42(4), 43A(2), (4), (6)(a) and (7) as well as s52(4B) is not clear and has been understood differently in several cases. An important distinction in language is found in s43A(7) which requires that proceedings be dismissed if the Court is satisfied "that the claimant does not have a full and satisfactory explanation for the delay in making the claim" (emphasis added). The other subsections including s52(4B) stipulate that the person commencing the proceedings or the claimant provide a full and satisfactory explanation for non-compliance or delay. In Russo v Aiello (2003) 77 ALJR 1775 the High Court, on appeal from this Court, considered the case of a late claim under the Act, namely a claim made by the appellant more than six months after the date of the motor accident to which the claim related; s43(2) of the Act. Section 43A(2) enables a claim to be made more than six months after the relevant date "if the claimant provides a full and satisfactory explanation for the delay in making the claim". The respondent sought to have the appellant's statement of claim dismissed under s43A(7). 18 In their joint judgment at 1784-5, Gummow and Hayne JJ said: "[58] The use in subs (7) of the phraseology 'does not have a full and satisfactory explanation for the delay' indicates that, in determining whether it has attained the requisite satisfaction, the court is not restricted to a consideration of the explanation which the claimant was obliged by subs (2) to provide 'in the first instance' to the insurer. The question the statute presents is whether the court is satisfied, on all the material before it, that the claimant does not 'have' a full and satisfactory explanation for delay. The proceedings must be dismissed if the court is satisfied that either or both (i) it does not have before it a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation, or (ii) that a reasonable person in the position of the claimant would not have been justified in experiencing the same delay. [59] Evidence tending to establish the 'full account' referred to in (i) above is peculiarly likely to be within the control of the claimant. It follows that, ordinarily, a conclusion that the court does not have before it a 'full account' of the claimant's conduct at the relevant times may more readily be reached where the claimant has failed to provide, by the close of submissions, such an account. However, the onus remains on the applicant to satisfy the court that the claimant does not have a full and satisfactory explanation for the delay. The discharge of this onus ordinarily would involve specifying the respects in which the claimant's account is said not to be 'full' in the relevant sense, and identifying why it is that a reasonable person in the claimant's position would not have been justified in experiencing the same delay. [60] However, the applicant under par (c) of s43A(6) and s43A(7) is not required to speculate upon or to seek to challenge an unarticulated, or secret, reason for delay; a reason for delay which the claimant does not articulate cannot be described as an 'explanation' for delay. It follows that the requisite satisfaction that a claimant does not have a full and satisfactory explanation for delay may readily be attained where a claimant fails to disclose any explanation at all. So much is consistent with the objects of s43A, which are identified in subs (1) thereof as being: '(a) to ensure that the issue of the lateness of a claim is dealt with as soon as possible after receipt of the claim, and (b) to ensure that any delay caused to the consideration of the substantive claim by the lateness issue is kept to a minimum, and (c) to ensure that the lateness issue is either resolved or made a mutually apparent substantive issue at an early date.' [61] Contrary to a submission put by the appellants in this Court, the imperative language of s43A(7) leaves no room for a consideration of any 'prejudice' that may be caused to the parties by a decision to dismiss or to decline to dismiss the proceedings. The provision imposes a duty to dismiss upon the attainment of the relevant satisfaction; it does not confer a discretion to extend time of the type commonly found in statutes of limitation, the exercise of which may require evaluation of any prejudice to the defendant." 19 At 1786-8 their Honours said: "[72] The District Court therefore had before it an account of the conduct, including the actions, knowledge and belief of the claimant from 6 December 1997 to 6 October 1998. However, the conclusion was open that this was not a 'full' account within the meaning of s40(2) of the Act. Even when regard is had to the additional material not referred to by the primary judge, it was still correct to observe, as his Honour did, that: '[t]here is no attempt to identify when it was that the plaintiff realised that his disabilities had not improved, thus leading to the decision to seek further legal advice, and there is no attempt to identify when that decision was made.' [73] Moreover, even if it were accepted that the account was relevantly 'full', the conclusion would be open that the claimant's explanation in respect of the period 6 December 1997 to 6 October 1998 was not 'satisfactory' because a reasonable person in the position of the claimant would not have been justified in persisting in such a delay. [74] Whether a 'reasonable person' would have been so 'justified' requires an evaluation by reference to a hypothetical objective standard and in light of the objects of the Act. Part 5 of the Act evinces a legislative intention 'to promote prompt settlement of claims and to encourage forensic diligence'. The statutory scheme, emphasised repeatedly in the provisions to which reference has earlier been made, is to encourage the early investigation, assessment and resolution of claims. The statute in terms indicates that this scheme is intended to advance the interests of claimants in rehabilitation, prompt treatment and prompt payment of lost earnings and the interests of insurers in more accurately predicting claim frequency and formulating premiums. Those objects are sought to be achieved by the imposition of time limits and obligations to act expeditiously on both claimants and insurers. [75] The claimant here had been informed of the time limit with which he was required to comply. The relevant delay extended for some 10 months, at a time when the initial six month limit itself had elapsed six months prior to the commencement of the period of delay now in issue. The delay was not referable to any delay in the onset of symptoms, the consideration to which the Act refers in s43A(3). It is not to be assumed that this is the only consideration which may be relevant to whether a reasonable person in the position of the claimant would have been justified in experiencing the same delay. Nonetheless, in the relevant period, the claimant experienced recurrent symptoms, the severity of which became gradually more apparent to him, and yet he failed to make a claim which he knew should have been made on or before 11 July 1997. The conclusion was open that a reasonable person in the position of the claimant would not have been justified in a delay of this degree."

Their Honours concluded that the majority in the Court of Appeal had not been shown to have erred in upholding the conclusion of the primary judge that the claimant did not have a full and satisfactory explanation for the delay in making the claim. 20 In his judgment, Gleeson CJ said at 1776: "[5] Part 5 is replete with legislative declarations of its objects. This is not an exercise in apologetics. Rather, it gives practical content to terms such as 'reasonable', 'justification' and 'satisfactory'. What would constitute justifiable delay on the part of a reasonable person in making a claim is to be considered in the light of the legislative purposes explained in the Act." … [6] The concept of 'a reasonable person in the position of the claimant' could give rise to difficulties that do not exist in the present case. The first appellant consulted a solicitor some 10 days after the motor vehicle accident in which he was injured. He was informed of the time limits imposed by the Act, and was handed a claim form. There is no basis in the evidence for concluding that he did not receive prompt and competent legal advice. We are not concerned with the possible significance of incompetent or inadequate legal advice, or lack of awareness of the time limits on making a claim. [7] Leaving to one side problems of the kind just mentioned, what would justify a reasonable person in the position of the claimant 'experiencing' a delay? It is impossible to give an exhaustive list of possible justifications. Delay in onset of symptoms is one example; and it is an example of some relevance to this case. It is to be noted that what the Act requires is justification for delay; not demonstration that the delay caused no harm. …"

His Honour agreed with the orders proposed by Gummow and Hayne JJ. 21 At 1780 McHugh J said: "[27] … But although it is a factual and not a legal issue, the criterion of a 'full and satisfactory explanation' for delay does not involve any perception by the senses of some matter, event or entity in the external world. It does not depend on sight, hearing, feeling or touch. A 'full and satisfactory explanation' for delay is an intellectual construct involving a value judgment, a judgment on which reasonable persons may have widely differing views. It is therefore properly described as a discretionary judgment. Because that is so, the Court of Appeal could set aside the primary judge's decision on the issue only on the basis of the well-known principles concerning an appeal against a discretionary judgment."

As to this last matter see generally Moran v McMahon (1985) 3 NSWLR 700 at 714 and following, particularly 723. Kirby J dissented and would have allowed the appeal. 22 In Mancini v Thompson [2002] NSWCA 38 Rolfe AJA, with whom both Beazley and Stein JJA agreed, said at [46], when considering s43A(7) of the Act: "[46] … What was required was a full explanation for delay and, in order for the explanation to be full, it had to include 'the actions, knowledge and belief of the claimant from the date of the accident until the date of providing the explanation'. In other words, the requirement that the explanation be full focussed upon the period from the date of the accident until the date of providing it, and the necessity to set out fully 'the conduct, including the actions, knowledge and belief of the claimant'. The purpose of this is so that the Court can evaluate all of the reasons for the delay and decide whether they are full and satisfactory. The applicant, therefore, cannot 'pick and choose' the information to be given relevant to the delay and which the Court has to decide is 'satisfactory'." 23 These remarks were endorsed by this Court (Handley and Stein JJA and Davies AJA) in Laidlaw v Touma [2002] 36 MVR 388. Stein JA said at 391 [19]: "The word 'full' must be given some meaning and content. In its context in the Act, I think that it means complete - that is, that a complete explanation is required. This full explanation is of course necessary before one turns to consider whether it is a satisfactory explanation." 24 Diaz v Truong was a majority decision (Hodgson JA and Foster AJA, Giles JA dissenting) dismissing an appeal from a District Court judge's decision to grant leave to commence proceedings. At 165 [40-42] Giles JA said: "[40] When asking whether the full account of the conduct is a satisfactory explanation, satisfactoriness is not confined to whether a reasonable person et cetera. That a reasonable person et cetera is a necessary condition, but it is not stated as a sufficient condition. [41] The purpose of 'unless a reasonable person in the position of the claimant would have failed to comply with the duty or would have been notified in experiencing the same delay' in the second sentence is tolerably clear. It is intended to set an objective standard of conduct which the full account of the conduct to which the first sentence refers must achieve. That does not necessarily make the explanation satisfactory, although it is not easy to see why a full account of conduct meeting the objective standard would not generally be a satisfactory explanation. [42] The standard of a reasonable person in the position of the claimant failing to comply with a duty is understandable. The standard of a reasonable person in the position of the claimant being 'justified in experiencing' a delay is more obscure. Experiencing something normally means being subjected to it, the object of acts or omissions by another or others. What is meant by being justified in experiencing a delay? It must mean that the reasonable person in the position of the claimant would have been subjected to the delay and the subjection to the delay would have been justified. The hypothetical experiencing of delay must have the quality of a justified experiencing of delay." 25 At 177 [92] Hodgson JA referring to s52(4B) said that it seemed clear that the explanation must be provided by persons acting on the claimant's behalf. "[92] … Turning to s40(2), it would be curious if, where the claimant is a very young child and/or brain damaged, all that had to be addressed pursuant to the first sentence of that subsection was the conduct of the claimant himself or herself. In my opinion, what is necessary is a full account of acts and omissions of the claimant and of persons acting on behalf of the claimant, in so far as those acts and omissions are relevant to the explanation for the delay. When one comes to the second sentence of s40(2), the specific reference to 'a reasonable person in the position of the claimant' means, in my opinion, that the focus there is directed solely at the acts and omissions of the claimant himself or herself, and must be judged as against what would have been the actions and omissions of a reasonable person in the position of the claimant, that is having the relevant characteristics of the claimant, in this case a 9 year old girl suffering brain damage." 26 Hodgson JA continued: "[94] Turning to the question whether there has, in this case, been a full explanation given, there is force in Mr Shore's submission that there is a deficiency in the explanation of how Mr Reetov [a solicitor] in particular could have remained of the belief that the 3 years did not run until the opponent turned 18, in the face of the correspondence and telephone conversation. There is also force in the submission that there is not a full explanation of why ss48 and 50A particulars had not been given, and in the consideration, referred to by Giles JA, that there is no explanation of why, even given the misapprehension, proceedings were not commenced earlier. However, it could be considered that the true explanation of why proceedings were not commenced within time, but only sought to be commenced 4 months later, was just the misapprehension; and if, as I believe to be the case, the primary judge has both accepted the existence of the misapprehension and that this was the true explanation of the delay, I do not think this court should interfere with that finding. If other matters had contributed to the delay in some significant sense, then an explanation would have been required of those other matters; but there is no finding by the primary judge to that effect, and the tenor of the primary judge's judgment is to the contrary. [95] Turning to the question of whether the explanation is satisfactory , in my opinion there can be no shortcoming attributed to the acts or omissions of the opponent herself, and in those circumstances I do not think there is any error in the finding of the primary judge that the explanation was satisfactory. [96] The complaint may be made that, on the approach I have taken, there will rarely be cases where a claimant under the Act who is a young child and/or is brain damaged will fail to pass the first threshold for obtaining an extension of time. Even if the explanation is one of total neglect by persons acting on his or her behalf, if that is the full explanation, then normally there will be no deficiency in the conduct of the claimant that would prevent the explanation being both full and satisfactory. I do not see that result as contrary to the purposes of the Act. Even in such a case, the court will then have a discretion, and will grant the extension only if the interests of justice require it. Such an approach is not an unreasonable balance between the desirability of an early resolution of such matters, on the one hand, and the philosophy of the Limitation Act, postponing the running of time during minority, on the other hand. It also avoids the unsatisfactory prospect of subsequent claims brought by injured minors against their (uninsured) parents, in those cases where the parents caused the delay and have no satisfactory explanation for it, a prospect unlikely to have been intended by the legislature." 27 Foster AJA agreed with the orders proposed by Hodgson JA. At 181-2 Foster AJA referred to cases involving applications for extension of time to bring action against the Nominal Defendant including Hall v Nominal Defendant where Barwick CJ, whose views did not prevail, said of a section in the Tasmanian legislation which enabled the court to extend the time for instituting proceedings: "But the ends which the section seeks to serve require that the time limitation shall not stand in the path of justice. A very short time is set by the statute within which an action against the nominal defendant may be brought, and therefore a power to extend that time is given to a court of law so that justice may be done according to the circumstances. No doubt this extension of time is not as of course. Some acceptable explanation for the failure of the appellant to sue in time must be given before the court is required to consider the substantial question whether it would be just to grant the extension. The door, as it were, must first be opened. No hard and fast rule can be stated defining what may be an acceptable explanation. But at least, in my opinion, it should be held that it is the litigant's failure to sue in time which must be satisfactorily explained. However much in some fields the client must suffer for his solicitor's acts done on his behalf, in this field the litigant is not necessarily, in my opinion, to be saddled with responsibility for all that his solicitor does or does not do. It seems to me to be implicit in the views of the Court in Sophron's case [(1957) 96 CLR at 474], where it says that the blamelessness of the client and the responsibility of the solicitor are material considerations, that the client's reasonable acceptance of a solicitor's advice, the solicitor having been properly apprised by the client of all the materials, relevant facts and circumstances within his knowledge, may be a sufficient explanation of the failure to take action within time." 28 Foster AJA said at 182 [116] that it had frequently been said that it might be unfair to relegate the client to a far less satisfactory claim against his solicitor, when, through no fault of his own, he would lose a superior right to sue the actual tortfeasor. Even less satisfactory, as Hodgson JA has remarked, is it for a child to be relegated to a claim against a parent or guardian. 29 Foster AJA said that he took a somewhat different approach to the construction of s40(2) and its effect upon the operation of s52(4) and (4B)(a) to that taken by Hodgson JA. At 183 his Honour said: "[122] The first sentence of the subsection appears to equate a 'full and satisfactory explanation' with 'a full account of the conduct, including the actions, knowledge and belief of the claimant' which is to be provided 'from the date of the accident until the date of providing the explanation'. Assuming for the moment that the 'conduct' referred to is conduct not only of the claimant personally but also of those acting for him, those words could be construed as requiring a point by point account of all steps taken in relation to the claim by all those involved in it from its very outset until the provision of the explanation contemplated in s51(4B)(a). If this were its correct interpretation, it could lead to explanations of considerable and unnecessary prolixity, unreasonably burdensome to both the author and the reader. I do not think that that is the legislative intention. The 'full account' required is one focussed on 'the delay', a phrase, which, in my view, can refer only to the time which has relevantly elapsed since the expiry of the limitation period. What is required is a full account of the conduct which has resulted in the action being out of time, that is, one which is complete and not simply a selection of facts likely to assist the application for extension. Facts which relate only to ordinary preparatory steps taken well within the limitation period need not, in my view, be the subject of detailed exposition, although the section would seem to require some reference to them, because of the time-frame it prescribes. [123] In terms of the 'fullness' of the account, I regard this case as fairly borderline. I am, however, in respectful disagreement with Giles JA. I consider that the admittedly exiguous and compendious references to the activities undertaken by the solicitors handling the case are, in the circumstances where the primary judge has found the cause of the delay to be their misapprehension of the time limit, sufficiently 'full' to comply with the section. [124] I do not agree, with respect, with Hodgson JA, that the section confines the question of the satisfactoriness of the explanation to its second sentence. In my opinion, the 'account of the conduct' referred to in the first sentence must also be 'satisfactory', in the sense referred to by Studdert J, whose view I respectfully adopt. It must form part of the satisfactory explanation, if s54(4B)(a) is to be engaged in favour of an applicant. " 30 Foster AJA was there referring back to para [118] at 182 of his judgment which was as follows: "[118] The legislative provisions in question in these proceedings, namely s52(4) and (4B) were inserted in the Act in 1995, as was s40(2). Earlier provisions had required 'a full and satisfactory explanation for … the delay', a concept which was undefined and unelucidated by second reading speech or parliamentary debate. It is possible that s40(2), which now offers a definition or exposition of this phrase, may have been enacted in response to decisions such as Nicholas v Webb [No 2] (1993) 19 MVR 65, in which it had been held that the words 'full and satisfactory' were conjunctive and related to the quality of the explanation offered for the delay, but not to the conduct responsible for the delay. This interpretation had been rejected by Studdert J in Guest v Southern (unreported, SC (NSW), Studdert J, No 19154 of 1993, 22 September 1995, BC9505406) where his Honour had held that 'full' meant 'complete' and 'satisfactory' meant the claimant was required to persuade the court that the delay should, in all the circumstances, be excused. This decision preceded the amendments. However, the explanatory note to the Motor Accidents Amendment Act 1995, the second reading speech and the parliamentary debate cast no light." 31 In his judgment in Guest v Southern of 22 September 1995 Studdert J quoted from the reasons for judgment of Master Malpass from whose decision the appeal, which Studdert J was dealing with, came. The Master had said, as quoted by Studdert J,: "Because there has been a breach of a time limitation, the claimant is required to explain the delay. In many cases (if not most), the delay will have been occasioned by some lack of diligence on the part of the claimant and/or his advisers. The function of the provision is to require the claimant to explain that conduct in the course of the providing of a full and satisfactory explanation for the delay. It is not to provide a weapon which may enable an insurer to defeat the claim because of such conduct. It may be defeated if the Court decides that the claimant has failed to provide a full and satisfactory explanation for the delay. Since the coming into force of the Act, the Court has dealt with a veritable landslide of applications pursuant to s52(3). During those years, a consistent approach has been adopted in dealing with these applications. The applicable law has become settled and the provision has failed to generate much excitement for some years. The defendant wishes now to disturb such torpor. The Court has consistently adopted the approach that the words 'full' and 'satisfactory' relate to the explanation offered for the delay and not to the conduct which has been responsible for the delay. This has been the approach followed by the Court since the Act came into operation. It was foreshadowed as early as Flower v Fitzgerald and Anor (6 November 1990)." 32 Studdert J said at 16: "Earlier in this judgment I referred to the part of the master's judgment which disclosed his approach to the meaning of the expression 'full and satisfactory explanation for the delay'. He considered it relevant address the adjectives 'full' and 'satisfactory' to the 'explanation' but, as I understand it, he did not consider it relevant to make an assessment of the conduct accounting for the delay. Hence even though he regarded the conduct of the plaintiff's solicitors to display 'incompetence and neglect of the highest order', this did not bear on his decision, satisfied as he was that the evidence placed before him accounted for the delay. If that construction of the subsection is correct then the subsection has but dubious utility, achieving no more than to call upon the claimant to give an account for the delay. Provided he does so, then no matter how dilatory he has been and no matter how indifferent he has been towards the pursuit of his claim, once the claimant has placed before the court what the court is satisfied is a full account of what he has done or failed to do and his reasons for the default, the requirements of the subsection have been met, however unsatisfactory those reasons may be. The subsection has to be looked at in the framework of Pt5. One of the aims of Pt5 is to have claims processed as quickly as possible. S52 itself excludes the operation of the Limitation Act of 1969 and sets its own time constraints. If s52(3) is to be construed so as to have the possible effect of tolerating a delay for which there has been no exculpatory cause shown, then the subjection would not address this objective. It is to be observed that the subsection not only requires that the claimant give a 'full' (or complete) 'explanation', but also an 'explanation' that is 'satisfactory'. It seems to me in the context that before an explanation can be 'satisfactory', it must persuade the court that the delay ought to be excused in all the circumstances. It is to be noted that s43(3) expressly provides that delay in the onset of symptoms relating to an injury may be given as an explanation for delay in giving notice of a claim within six months. One can readily understand the inclusion of such a subsection notwithstanding Parliament's aim to have the claim brought to finality as expeditiously as possible. That subsection does not, of course, exclusively define circumstances in which a 'satisfactory' explanation for delay may exist, and a comprehensive list of such circumstances cannot be exhaustively defined; however, what s43(3) does is to instance a circumstance affording a satisfactory explanation which is consistent with the meaning of a 'satisfactory explanation' as I perceive the subsection to bear."

This was the view of Studdert J which Foster AJA adopted in para [124]. 33 Foster AJA continued: [125] I find the second sentence difficult. I agree with Hodgson JA that it appears to focus attention on the claimant, at least to the extent that his particular 'position' in the whole of the factual situation is to be taken into account. Does 'position' involve particular personal characteristics, such as, in the present case, childhood and incapacitating brain damage? If the introduction of the 'reasonable person' is a legislative attempt to import an objective standard, is one to assess the satisfactoriness of the explanation by the application of what, in this case, would seem to be an absurdly artificial yardstick, namely the standard of a reasonable brain-damaged infant. Or, is it the legislative intention that these personal characteristics be ignored and that the claimant's 'justification' for 'experiencing' the delay be assessed on the basis that he is the hypothetical 'reasonable person', well known to the law. The latter approach would attribute very little work to the words 'in the position of'. [126] Doing the best I can, I have come to the conclusion that the second sentence relates back to the words in the first sentence 'the actions, knowledge and belief of the claimant' and requires that these be scrutinized according to a standard of 'reasonableness'. Where the claimant is out of time because his lawyer has allowed this to happen, then the claimant's activities, knowledge and belief must also be examined, to see if he has contributed to this situation. Has he, for instance, failed to answer his solicitor's letters, or changed his address without notifying his solicitor? Has he, having been advised by his solicitor as to the existence of the limitation period, ignored the advice? Conversely, if he has been wrongly advised as to the extent of this period, are there circumstances which would have led a reasonable person to query the advice? Other examples can be envisaged. If the answers to such inquiries point to a failure on the part of the claimant to measure up to the standard of the 'reasonable person', then that failure could require a finding that he was not 'justified' in 'experiencing' the delay, with the result that the delay cannot be satisfactorily explained. [127] In this situation the words 'in the position of the claimant' have work to do. Although in an unclear manner, they provide an indication of legislative intention that, in the application of the 'reasonable person' standard, regard must be paid to the particular position of the claimant. If the claimant, because of his position, could not be expected to meet the measure of 'a reasonable person', then this objective standard does not apply to him and the disqualification imposed by the second sentence upon his explanation does not arise. [128] In my opinion, the opponent, who could never be regarded as 'a reasonable person' does not encounter the particular disqualification provided for in the second sentence. Her explanation must still be assessed as to whether it is 'satisfactory' in accordance with the first sentence, read with s52(4B)(a). Having regard to the reasonable reliance of the family upon the solicitor's advice and the total incapacity of the opponent herself, I am satisfied that the explanation is satisfactory. [129] I am also satisfied that, in accordance with authority, little weight should be given to any right of action the claimant may have against the solicitors. This right should not stand in the way of an order extending time, if it is otherwise available." 34 In Manderson v Ellis this Court, differently constituted, (Santow JA, Davies, AJA and McClellan J) allowed an appeal from a decision of a District Court judge who declined to dismiss an action despite a late claim. In the course of his judgment, Santow JA at 219 para 17, quoted from the judgment of Studdert J in Guest v Southern. Unfortunately, the part quoted by Santow JA was that taken from the judgment of Master Malpass with which Studdert J disagreed. 35 Santow JA at [18] referred to Diaz v Truong and observed that Foster AJA agreed with Hodgson JA "that the second sentence in s40(2) ('a reasonable person in the position of the claimant would have failed to comply with the duty') focuses attention on the claimant, at least to the extent that his particular position in the whole of the factual situation is to be taken into account. …But he would require, as would Giles JA, that the explanation also satisfy an objective standard of reasonableness applied to the claimant circumstanced as he was; … I would apply that double-barrelled test here, and focus on the explanation the claimant has, not his solicitor, but including under 'claimant' the person in charge of his affairs …" 36 In that case, a decisive factor was that referred to by Davies AJA at 226 (57): "The most probable explanation of the events is that Ms Morgan [an employee solicitor] was grossly negligent in looking after the respondent's affairs and that she failed to ensure that the respondent's claim was prosecuted in accordance with his instructions. No affidavit mentions or suggests that a lack of funds contributed to the events. The explanation given fails to meet the requirements of a full and satisfactory explanation." 37 In Buller v Black (2003) 56 NSWLR 425 this Court again visited s43A(7) of the Act in an appeal from the dismissal of proceedings pursuant to that section. Giles and Ipp JJA were of opinion that the appeal should be dismissed. Mason P would have upheld the appeal. At 435 Mason P observed that issues about the extent to which the plaintiff was affected by the inappropriate dilatoriness of appointed agents did not arise. At 437 his Honour said: "[61] Section 43A proceeds on the supposition that a reasonable person can be in default yet have a satisfactory explanation for that default. The standard is reasonableness, not perfection, and the reasonableness of a person placed in the actual position of the particular claimant. The ultimate questions are whether a reasonable person in that position would have failed to have complied with the duty (to file the claim within six months) or would have been justified in experiencing the same delay." 38 The President approached the appeal on the basis that appellate review is not restricted by the principles in cases like Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259, namely that the decision is not to be scrutinised upon over-zealous judicial review by seeking to discern whether some inadequacy may be gleaned from the way in which the reasons are expressed or as a reconsideration of the merits of the decision (272). Nor was the appeal governed by the principles in House v The King (1936) 55 CLR 499; see McHugh J in Russo v Aiello at 1780 para [27]. 39 At 441-2 Giles JA, with whom Ipp JA agreed, said: "[94] The question was whether the explanation for the delay, being the delay in that the claim was not made until 3 April 2000, had been satisfactorily explained. The judge had to be satisfied that it had not been, with the persuasive burden on the opponent. The necessary requirement for a satisfactory explanation was that 'a reasonable person in the position of the claimant … would have been justified in experiencing the same delay'. This, as I observed in Diaz v Truong (2002) 37 MVR 158 at 165 [41]-[42], is intended to set an objective standard of conduct and meaning that the reasonable person in the position of the claimant would have been subjected to the delay and the subjection to the delay would have been justified. The language of experiencing the delay must have been intended to take account of other persons' conduct affecting the making of a claim. [95] The requirement must be understood for its function in the wider scheme in the Act. Section 43 states as its object, that is, the reason for the six month time limit, promotion of the early making of claims to enable the insurer to commence investigation while evidence is available, to identify injuries and facilitate access to injury management and rehabilitation services, and to more accurately predict claim frequency and hence formulate premiums. Late claims will still be recognised provided a full and satisfactory explanation for the delay in making the claim is provided, but only if the claimant's explanation is (relevantly) satisfactory, and satisfactoriness is given a minimum content. A person with knowledge of the six month time limit, in particular, can not tarry." 40 His Honour concluded: [96] … Satisfaction that a claimant does not have a satisfactory explanation for the delay in making the claim involves a normative judgment. It is not the exercise of a discretion, but where minds may reasonably differ in the making of the normative judgment it must be asked whether the judge's determination was open to him. If it was, error is not shown simply because another mind might have come to a different determination."

Contrast the judgment of McHugh J in Russo v Aiello at 780 para [27].

Conclusion 41 In order to satisfy the requirement of s52(4B)(a), the explanation the claimant provides to the Court for the delay must be full and complete so that, in the words of Rolfe AJA, the Court can evaluate all of the reasons for the delay. The claimant cannot "pick and choose" the information to be given. At one level, the explanation was that until 11 April 2003 Ms Walsh, the solicitor responsible for the care, conduct and control of the matter did not know that the three year limitation period from the date of the motor accident imposed by s52(4) applied to infants, apparently assuming that the running of the limitation period was suspended for the duration of the disability; see s52 of the Limitation Act. Thereafter she failed to institute proceedings because of her view about the operation of s50A and 52(1A) of the Act. Ms Walsh gave oral evidence and was vigorously cross-examined. She agreed that she was supervised but said that close supervision ended when she left Kell Heard McEwan and accepted that she was left to her own devices from the time that she went to Turner Freeman. Questions were put to her about the text-books she had consulted. She said: "A. I, I have read the books but it just was not apparent to me that that was the time limit. I know it seems really dumb, but I'm afraid that that is what happened. Q. Which text did you look at? A. Well we have in our office Goodcamp and Morrison and I know we had that when I was at Kell Heard McEwan and if I needed to find out something I would read it or I would ask my supervising partner. But I really had no clue that I had it wrong, so I didn't think to read it or ask because I just believed that that's what the time limit was. Q. How did you become aware of the time limit in respect of the action for the mother? A. Because she's an adult, up until the time that I took up over this claim all I had done was civil liability, public liability matters and the time limit at that time for infants was, expired when they turned twenty-one. I just naturally thought that it was the same under the Motor Accidents Act and of course for her mother, well she's an adult, she's over eighteen, the time limit expires after three years and that's just the mistake that I made." 42 She discovered her mistake on reading an article in the Law Society Journal on 11 April 2003. She said that she realised after reading this article that as a result of her misunderstanding of the law, the plaintiff's claim was in breach of s52 of the Act and that leave to commence court proceedings would need to be obtained. She said she was just horrified when she read the article and thought "My God, I've made a terrible mistake" and tried to rectify it. She did not inform the claimant's mother or father until September 2003. She said in evidence: "I didn't just want to ring her [the mother], I thought I'd like to get her and her husband in and explain what I'd done and they are both busy people, they both work and I thought it would take too long to get a consultation and I just wanted to get moving on the file and then I explained it to them before I filed the application. I don't think the fact that I delayed in telling them has had any material delay in this matter." 43 Previously she said in evidence she had spoken to a barrister and to her supervising partner. While the cross-examination was directed to Ms Walsh's conduct as a solicitor, none of it detracted from the completeness of the explanation. To some extent, it filled gaps in her affidavit. This interchange took place: "RENSHAW: Q. Well you have no explanation again as to why you didn't notify them within the two weeks, do you? A. I do and the reason is that I was afraid to tell them and that I wanted to put the section 50A particulars on first and then I thought I would do everything that I believed I needed to do and then I would notify them. I felt that notifying them first was not the most important thing to do in getting the matter on, in getting the matter listed. Q. You thought that they had no inherent right to know, is that what you're saying? A. No it's not what I'm saying but I just felt that there were other more important things that I had to attend to to try to rectify my error. Q. For which you never received any advice? A. No. Q. Had no knowledge of whether they were important or not in prioritising an application for postponing a bar? A. No, well this has never happened to me before but I thought you could not commence proceedings unless you had provided those particulars." 44 Otherwise as to delay, Ms Walsh said in her affidavit of 11 September 2003: "48 Due to my misapprehension about the time limit and the fact that the plaintiff's injuries had not stabilised that [sic] I considered that there was no urgency in pursuing the matter. This meant that there were extended periods of months where no work would have been done on the matter." 45 The difficult question is whether this explanation was a satisfactory explanation. Section 40(2) speaks about an explanation "by a claimant" and to a full account of "the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation." As already mentioned, "Claimant" is defined in s40(1) as "a person who makes or is entitled to make a claim". As Gleeson CJ pointed out (1776-7 para [6]), the High Court in Russo v Aiello was not concerned with the possible significance of incompetent or inadequate legal advice, or lack of awareness of the time limits in making a claim. However, as Gummow and Hayne JJ said, whether a reasonable person would have been justified in experiencing the same delay requires an evaluation by reference to a hypothetical objective standard and the object of s52(1)(a) "to encourage and facilitate the investigation, assessment and negotiation of a claim for damages without the commencement of court proceedings". As a matter of fact this object seems to have been achieved if not as expeditiously as would have been the case if the time limitation had been adhered to. 46 This Court in Diaz v Truong was concerned with incompetent solicitors acting on the claim of a child aged five who had suffered serious injuries and was permanently disabled as the result of a motor vehicle accident. Giles JA and Hodgson JA differed about whether in the second sentence of s40(2) the focus was directed solely at the acts and omissions of the claimant himself or herself so that whether the explanation was satisfactory was judged against what would have been the acts and omissions of a reasonable person in the position of the claimant. 47 The limitations imposed by Pt 5 of the Act if they result in a child's proceedings being barred can detrimentally affect the whole life of that child. A baby is badly injured in a motor vehicle accident as a result of the driver's negligence. A parent or a solicitor due to indolence or incompetence takes no steps within time to make a claim or commence proceedings. That is the explanation for the delay. But in considering whether that explanation is satisfactory the Court must consider whether a reasonable person in the position of the claimant would have failed to comply with the duty or would have been justified in experiencing the same delay. An explanation that the parent or solicitor was lazy or incompetent could scarcely be a satisfactory explanation. So it is said that for that reason the child's claim fails. As already mentioned, there may be a claim against the dilatory parent or the incompetent solicitor but there are marked disadvantages to this which were described by Smith J in the Supreme Court of Victoria, Appeal Division, in Repco Corp Ltd v Scardamaglia (1996) 1 VR 7 at 15: "While it might be said that on the evidence before the court the rights against the legal representatives appear to be strong, there is no admission of negligence by the legal representatives and the issues that may arise in any such action have not been investigated or pursued fully in these proceedings. In any event, confining Mr Scardamaglia to an action against the legal representatives would carry with it its own prejudice. He would be able to seek compensation not in respect of his injuries, but for his loss of his right to sue Repco. He would find himself having to prove two cases - the original case against Repco and a further case, the case against the legal representatives. The proceeding would, therefore, be more time consuming and more costly. There would also be a real risk, that, if successful, any sum recovered would be less than any sum that he would have recovered in the original proceeding: for any damages awarded would be for the lost chance to recover damages in the proceeding against Repco: Johnson v Perez (1988) 166 CLR 351; Nikolaouv v Papasavas Philips & Co (1989) 166 CLR 394." 48 In Diaz v Truong, Foster AJA was of opinion that the explanation must be satisfactory in the sense referred to by Studdert J. But Studdert J was not concerned with s40(2) which came into force later and introduced the idea of "a reasonable person in the position of the claimant" failing to have complied with the duty or being justified in experiencing the same delay. Foster AJA was concerned with what he described as the absurdly artificial yardstick, namely the standard of a reasonable brain damaged infant. He accepted however that to ignore the personal characteristics and look only at the reasonable person attributed very little work to the words "in the position of". Foster AJA concluded that the second sentence related back to the words in the first sentence "the actions, knowledge and belief of the claimant" and required that these be scrutinised according to a standard of reasonableness. In this situation, the words "in the position of the claimant" had work to do. In an unclear manner they provided an indication of legislative intention that, in the application of the "reasonable person" standard, regard must be paid to the particular position of the claimant. But, if the claimant, because of his position, could not be expected to meet the measure of "a reasonable person" the objective standard did not apply to him and the disqualification imposed by the second sentence upon his explanation did not arise. In Foster AJA's opinion, in that case, the opponent child, who could never be regarded as "a reasonable person" did not encounter the particular disqualification provided for in the second sentence. The explanation must then be assessed as to whether it was "satisfactory" in accordance with the first sentence read with s52(4B)(a). 49 In this case, neither the claimant nor her mother were in any way responsible for the failure to institute proceedings within time. The claimant was incapable of giving any explanation. The mother's explanation of the delay was satisfactory. She learnt of Ms Walshs' mistake and the need to obtain leave to commence proceedings on 1 September 2003, two days before the application was filed. Whether the expression "in the position of" in s40(2) embraces only the claimant herself or embraces also her mother, the posited "reasonable person" would have been justified in experiencing the same delay since neither knew anything about the limitation period or the need to make the application until 1 September 2003. Ms Walsh fully explained her further delay after 11 April 2003 in the cross-examination I have quoted in paras 38 and 39. Applying either the test in Diaz v Truong as articulated by Hodgson JA or as articulated by Foster AJA the explanation was, within the meaning of s40(2) of the Act, satisfactory. In this case those considerations, to which Judge Goldring did not refer, subsume what his Honour regarded as Ms Walsh's want of forensic diligence. On that basis, the conclusion his Honour reached was not open to him and leave to appeal should be granted and the appeal upheld.

Orders 50 In my opinion, the following orders should be made: 1. Grant leave to appeal; 2. Appeal allowed; 3. Set aside the order of Judge Goldring; 4. Grant leave to the claimant by her tutor to commence proceedings in respect of this claim within twenty-eight days of the making of this order; 5. The opponent to pay the claimant's costs of the hearing before Judge Goldring and of this application and appeal but in respect of the application and the appeal to have a certificate under the Suitors' Fund Act 1951 if so entitled. 51 HODGSON JA: I agree with Sheller JA, and would add the following on the interpretation of s40(2) of the Motor Accidents Act 1988, which is in the following terms: 40(2) In this Part, a reference to a full and satisfactory explanation by a claimant for non-compliance with a duty or for delay is a reference to a full account of the conduct, including the actions, knowledge and belief of the claimant, from the date of the accident until the date of providing the explanation. The explanation is not a satisfactory explanation unless a reasonable person in the position of the claimant would have failed to have complied with the duty or would have been justified in experiencing the same delay. Note. The requirement for "a full and satisfactory explanation" is made in sections 42 (4), 43A (2), (4), (6) (a) and (7) and 52 (4B). 52 In Diaz v Truong (2002) 37 MVR 158, Foster AJA and I agreed in the result, but had some disagreement as to the construction of this provision. 53 Foster AJA expressed disagreement with my view that s40(2) confines the question of satisfactoriness of the explanation to its second sentence. In other words, whereas I considered that fulfilment of the requirements of the second sentence was both necessary and sufficient to make a full explanation a satisfactory one, Foster AJA considered it necessary but not sufficient. He also considered that "a reasonable person in the position of the claimant" meant a hypothetical reasonable person in the position of the claimant, dealing as did the claimant with lawyers or perhaps other people on whom the claimant relied, but leaving out of account characteristics of the claimant such as tender years or brain damage. 54 On the first matter, I accept that the second sentence does not in terms make its fulfilment sufficient to make a full explanation a satisfactory one. However, if the delay experienced by the claimant is one which a reasonable person in the position of the claimant would have been justified in experiencing, and if a full explanation for the delay is given by the claimant and the claimant's advisers, I find it difficult to envisage any circumstance in which the explanation would not be considered full and satisfactory. In particular, I do not think unsatisfactory conduct by the legal advisers would have this effect, although of course it could be relevant to whether it is just to grant the extension. 55 So while as a matter of language Foster AJA was correct, I do not think there is any practical difference between our positions on this matter. 56 On the question whether "reasonable person in the position of the claimant" leaves out of account a claimant's tender years, or perhaps brain damage, this is a matter that could make a significant difference in some cases. For example, if the delay is caused by a very young claimant's parent in failing to answer the solicitor's letters or changing address without informing the solicitor, would this prevent the explanation being satisfactory, because a reasonable person in the claimant's position would not have permitted this to happen? It is not necessary to resolve this issue in this case; but I am still of the view that it is unlikely that the legislature intended to promote legal proceedings by a child against its uninsured parents.

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