CONCLUSION
108 For those reasons, the following orders should be made:
1. Leave to appeal granted.
2. Appeal dismissed.
3. Claimants to pay opponent's costs of the application for leave and appeal, and to have a Suitors Fund certificate if otherwise entitled.
109 FOSTER AJA: I have had the advantage of reading, in draft, the judgments of Hodgson and Giles JJA.
110 I agree with the orders proposed by Hodgson JA and with his Honour's reasons, except that I have a somewhat different approach to the construction of s.40(2) of the Motor Accidents Act 1988 ("the Act") and its effect upon the operation of ss.52(4) and 52(4B)(a). I shall first refer to some matters by way of background.
111 The learned primary judge, quite obviously, could have been in no doubt that, in relation to the delay in commencement of proceedings, the opponent was, herself, blameless. Moreover, the facts indicated that the opponent's mother and father also could bear no responsibility for failing to observe the limitation period. There was no dispute that they could not communicate in English and required the assistance, in this regard, of their sixteen year old daughter. It is clear that either they had no knowledge of the existence of a limitation period or if, as the evidence at least suggested, they had been advised of its existence, the advice was to the effect that action could be brought at any time up to three years after the opponent's eighteenth birthday. There is no suggestion that they were unco-operative or dilatory in relation to the opponent's claim. Moreover, the insurer was, on a without prejudice basis, meeting the opponent's considerable medical expenses.
112 His Honour, having seen and heard the solicitors, Mr Reetov and Ms Palazzolo in the witness box, accepted that each had held the mistaken view that the opponent had the benefit of the limitation period provided by the Limitation Act 1969. In the case of Mr Reetov he came to that view, notwithstanding the evidence of the letters and telephone conversations referred to in the judgments of Hodgson and Giles JJA. His Honour accepted Mr Reetov's evidence that, in effect, he had no significant recollection of those matters. Whilst there are some grounds for scepticism in relation to this evidence, I agree with Hodgson JA that it would not be appropriate to interfere with the finding of the primary judge that both the solicitors laboured under this misapprehension and that this was the real cause of the delay in commencing proceedings.
113 It was, of course, negligent of Mr Reetov, not to have made himself aware of the correct limitation period, which expired only a few days before he left his employment with Doherty & Partners and transferred the relevant file to Ms Palazzolo. Had he been warned by Mr Nevill, as seems likely, of its imminent expiry, that would have made his negligence the worse, but the result would have been the same. The proceedings were allowed to become statute barred.
114 The juxtaposition of the blamelessness of a client and the negligence of the solicitor has not infrequently produced difficulty in decision-making in applications for extension of time to sue. In cases involving applications for extension of time to bring action against the Nominal Defendant this problem has regularly arisen and continues to arise (see for example Nominal Defendant v Manning 50 NSWLR 139). In Sophron v The Nominal Defendant (1957) 96 CLR 469 at 474, the Court said:
No one of course doubts that such a consideration as the blamelessness of the claimant and the responsibility of his solicitors is very material. But every case must be determined on its own facts.
115 In Hall v The Nominal Defendant (1966) 117 CLR 423 at 435) Barwick CJ said, in respect of the limitation period in which suit could be brought against the Nominal Defendant:
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.
116 Examples may be multiplied, it being frequently said that it may 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. Thus in Morrison & Anor v Judd (CA 40504/95, 10 October, 1995 at p 11) Kirby P, after an extensive review of authority said:-
The availability of an action against a negligent legal representative is relevant because common sense says that it is so. It means that the litigant, who may be wholly or mainly innocent, is not put out of court without some chance of redress, however difficult that chance may be to enforce. To that extent an injustice, which might otherwise occur to the litigant, may be capable of being avoided. However, precisely because of the kind of difficulties which Smith J listed in Scardamaglia , it is a consideration which "cannot carry much weight.
117 It is clear that considerations of this kind necessarily play a part in the construction and application of various statutes imposing limitation periods. Salido v The Nominal Defendant (1993) 32 NSWLR 52), decided in respect of an earlier version of s.52(4) of the Motor Accidents Act 1988, is an illustration.
118 The legislative provisions in question in these proceedings, namely s.52(4) and s.52(4B) were inserted in the Act in 1995, as was s.40(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 s.40(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 & Anor (22 September 1994 NSWSC) 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.
119 I come, then, to the section as presently framed. Section 52(1) speaks only of "the claimant". Thus, by s.52(1)(b)(i), the three year limitation period can be extended only if "the claimant can explain the reasons for the delay in not commencing the proceedings within the three year period". By s.52(4) "a claimant is not entitled to commence proceedings" after the three year period "except with the leave of the Court in which the proceedings are to be taken", which leave must not be granted unless "the claimant provides a full and satisfactory explanation to the Court for the delay." Section 40(2) provides as follows:-
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.
120 I agree that, as a matter of reasonable construction, the explanation called for cannot be restricted to an explanation personal to the claimant. Despite the absence of reference to those acting on his behalf, their acts or omissions in that regard must fall for consideration. To hold otherwise would be to ignore the background history to which I have made reference. Thus, when the conduct of his solicitor has contributed to or wholly caused the relevant delay, that conduct must be explained as part of the claimant's obligation to provide "a full and satisfactory explanation", pursuant to s.51(4B)(a).
121 As the judgment of Hodgson JA shows, difficulty arises when consideration is given to the obligations of a "claimant" as provided in the two sentences of s.49(2). The subsection, also, has other difficulties relating to its exposition of the phrase "full and satisfactory explanation". I shall turn to these, in the first place.
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 s.51(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 s.54(4B)(a) is to be engaged in favour of an applicant.
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 enquiries 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 s.52(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.
130 I agree with Hodgson JA's decision in relation to the effect of s.52(1B) and (2)(a) upon s 50A in these proceedings. I accept the submission on behalf of the opponent that the question of compliance or non-compliance with s.48(2) does not arise until the time of commencement of proceedings. I note that it is asserted on behalf of the opponent that compliance has already occurred, but this is not accepted by the claimant. Resolution of this dispute is not called for in these proceedings, but clearly compliance with the section must be ensured.
131 I agree with Hodgson JA that it has been demonstrated that it would not be unfairly prejudicial to the claimant if time were extended. I consider that it is just and fair in the circumstances that the extension be granted.
132 As previously indicated, I agree with the orders proposed by Hodgson JA.
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