Dymocks v Capral [2010] NSWSC 195 | Case summary

1 HIS HONOUR: In these proceedings, the plaintiff claims damages from the defendants in respect of damage said to have been caused by water penetration through a metal roof of a building owned by the plaintiff. The first defendant (Capral) at least supplied the roofing material. The second defendant (the architect) is said among other things to have given advice in relation to the roof, including, in particular, as to the way that the metal roof should be affixed to the underlying steel rafters. 2 The architect filed a cross-claim in which it sought relief against a number of parties, for contribution or indemnity under s 5 of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) in respect of any amount that it might be ordered to pay to the plaintiff. Of particular relevance is the claim alleged against the second cross-defendant (the engineer). The architect wishes to assert that the engineer gave advice that certain "Buildex" roofing screws would be suitable for affixing the roof to the rafters. It is, as I understand it, the plaintiff's case that those screws were not suitable, that the use resulted in corrosion to the roof and that water penetration occurred through the corroded fixing points. 3 The engineer took the point that the plaintiff's claim against the architect was an "apportionable claim" for the purposes of Part 4 of the Civil Liability Act 2002 (NSW). Thus, the engineer said, the claim could not be maintained against it and the cross-claim should be summarily dismissed. 4 It is to be noted that the architect, in its response to the plaintiff's list statement, asserted that the plaintiff's claim was an apportionable claim and nominated, as parties having responsibility for any loss or damage that the plaintiff might have suffered, those who were the cross-defendants in its cross-claim. However, the plaintiff did not join any of those cross-defendants as defendants in the proceedings. 5 In support of its application to strike out, the engineer asserted that the claim against it must fail because of the operation of s 36 of the Civil Liability Act. That section provides that a defendant against whom judgment is given as a concurrent wrongdoer in relation to an apportionable claim cannot be required to contribute to any damages recovered from another wrongdoer in respect of the same apportionable claim, or to indemnify any such wrongdoer. 6 Mr JC Giles of counsel, who appeared for the engineer, submitted that the engineer was a "defendant" for the purposes of Part 4 of the Civil Liability Act because of the operation of s 35(5). By that subsection, a reference to a defendant in proceedings "includes any person joined as a defendant or other party in the proceedings (except as a plaintiff) whether joined under this part, under rules of court or otherwise". Thus, he submitted, his client, as a cross-defendant, was a "defendant" within that extended definition and no judgment could be given against it under s 36, for contribution to or indemnity against any liability that the architect might have for the plaintiff's apportionable claims. 7 I do not think that the submission, in that form, is correct. Section 36 protects a defendant against whom judgment is given under Part 4 as a concurrent wrongdoer in relation to an apportionable claim. Absent the cross-claim, and since the engineer is not a defendant in the proceedings brought by the plaintiff, there could be no judgment given against the engineer, as a concurrent wrongdoer or otherwise, in relation to the plaintiff's apportionable claim. I accept that if the engineer remained a cross-defendant, and judgment were given against it for contribution or indemnity for the purposes of the cross-claim, that could be a "judgment" against a "defendant" on a literal reading of s 36. However, that is precisely what s 36 forbids. 8 In my view, when s 36 talks of a defendant against whom judgment is given under Part 4 as a concurrent wrongdoer, it is referring to a judgment given against the defendant by the plaintiff or other person claiming relief. The purpose of s 36 is to bar cross-claims. It cannot be the case that s 36 comprehends within its field of operation judgments under the very cross-claims that it seeks to bar. 9 But that does not mean that the architect's cross-claim, as originally propounded, was maintainable. The purpose of contribution under s 5 is to adjust rights and liabilities between, on the one hand, defendants to suits who are adjudged to be liable, and, on the other, those who are joined as cross-defendants and are adjudged also to have been liable for the loss in respect of which the defendant is adjudged liable. By contrast, the purpose of Part 4 of the Civil Liability Act is to enable that apportionment of liability to occur in the action brought by the plaintiff, whether or not those responsible for any damage suffered by the plaintiff have been joined as concurrent wrongdoers. Thus, as Part 4 of the Civil Liability Act works its way out, the judgment given against a concurrent wrongdoer who is a defendant will represent only that concurrent wrongdoer's proportion of responsibility. It will not reflect any proportion of responsibility that the court attributes to any other concurrent wrongdoer. It follows, in my view necessarily, that when a judgment is given against a concurrent wrongdoer in respect of an apportionable claim, that judgment is not one in respect of which the concurrent wrongdoer is entitled to contribution or indemnity from any other concurrent wrongdoer. That is because, on the hypothesis that Part 4 requires to be considered, no other concurrent wrongdoer has contributed to the particular loss which is the particular or apportioned responsibility of the concurrent wrongdoer who is sued and against whom a judgment is given. 10 For those reasons, the cross-claim as it was originally propounded was not maintainable and the relief sought by the engineer, that it should be summarily dismissed, would have been granted. 11 The architect sought to meet this problem by propounding (through a Notice of Motion filed on 2 February 2010) an amended version of its cross-claim and seeking leave to amend. That amended cross-claim suffered from the same essential defect, although it introduced claims under the Trade Practices Act 1974 (Cth) and the Fair Trading Act 1987 (NSW). At least insofar as it repeated the claim for contribution in respect of the apportionable claim, it was doomed to fail. 12 The architect's position was that the plaintiff had not conceded that the claim brought by it was an apportionable claim for the purposes of part 4 of the Civil Liability Act. The plaintiff has now effectively, although in a conditional way, conceded that point. It follows, as Mr I G B Roberts of counsel for the architect accepted, that the claim for contribution in respect of the apportionable claim could no longer proceed. 13 However, matters did not stop there. The plaintiff sought and was granted leave to amend so as to introduce its own claims under the Trade Practices Act. The architect has now propounded yet another version of its cross-claim, in which it seeks contribution or indemnity in respect of that aspect of the plaintiff's claim only. It was common ground, at least for the purposes of the hearing before me today, that the plaintiff's claim under the Trade Practices Act was not an apportionable claim, because it was based on a cause of action which arose prior to the commencement of Part VIA of the Trade Practices Act. The decisions that establish that point include St George Bank Limited v Quinerts Pty Ltd [2009] VSCA 245. On that basis, it appeared to be common ground, the limited cross-claim that was propounded should be permitted to proceed. 14 I have gone into that lengthy detail, not to justify the orders that were made, which were essentially either by consent or not opposed, but because there is an outstanding issue as to costs. The engineer seeks the costs of its Notice of Motion. It says that it has succeeded, in the sense at least that the architect has recognised that the cross-claim as originally propounded was doomed to fail and has propounded a substantially different and narrower cross-claim. The architect submits that the engineer's costs should be borne not by it but by the plaintiff. That should follow, it says, because of what it characterises as the plaintiff's delay in making the concession now made, although on a conditional basis, that its claim against the architect (apart from the claim under the Trade Practices Act) is an apportionable claim. 15 Dealing first with the position between the architect and the engineer: it is in my view clear that the engineer should have its costs. For the reasons I have given, the cross-claim as originally propounded was defective and was one that warranted summary dismissal. The first version of the revised cross-claim, in respect of which the debate proceeded before me on the last occasion, was likewise, at least in part, defective. Once the architect propounded its limited cross-claim, in respect of which I have granted leave to amend, the engineer withdrew its opposition. In those circumstances, I think, the engineer has succeeded in substance on the notice of motion that it brought and it should have the costs of that notice of motion. 16 The position as between the architect and the plaintiff is perhaps a little more obscure. The architect says that it filed the cross-claim in the form that it did because the plaintiff had not admitted that its claim (excluding the claim under the Trade Practices Act) was an apportionable claim. The plaintiff submits in reply that it was never called upon to make that admission until the last occasion, when I directed it to file a reply setting out its position. It submits, correctly, that it complied with that direction and made the appropriate admission, as a responsible party, properly advised, should do taking into account its obligations under s 56 of the Civil Procedure Act 2005 (NSW). 17 The salient point appears to me to be that the architect maintained, on the one hand, that the claim against it was an apportionable claim, but, on the other, an entirely inconsistent position. Its stance under the cross-claim could not be reconciled with its stance under the list response. It may be that if the plaintiff had been called upon to state its position, and had refused to do so, or had obfuscated, there might be have been some justification for the position taken by the architect. But even in those circumstances, I think, a proper analysis of the facts must have led the architect to conclude that the claim against it was an apportionable claim (as it said) and that this was so regardless of whether the plaintiff conceded it or not. 18 In those circumstances, I do not think that there is any ground shown for ordering the plaintiff to pay the engineer's costs. 19 Accordingly, in addition to the orders that I have made granting leave to amend, I make the following further orders:

Dymocks v Capral

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