The plaintiff, GC Group Company Pty Ltd, was a subcontractor in a large residential development project at Albion Park. GC Group purchased "recycled aggregate" from the defendants, to whom I will refer collectively as "Bingo".
GC Group alleges that the aggregate supplied by Bingo was contaminated and that, as a result, GC Group was obliged to effect substantial reconstruction works at its own cost and has thereby suffered loss and damage.
By its Technology and Construction List Statement, GC Group alleges that Bingo is liable to it in damages for breach of contract and for breaches of alleged representations and consumer warranties under the Australian Consumer Law. [1]
On 20 May 2020 I ordered that the paragraphs in Bingo's then Technology and Construction List Response that sought to establish that GC Group's claim against Bingo was an "apportionable claim" for the purpose of s 34 of the Civil Liability Act 2002 (NSW) ("the Act)" be struck out. [2]
Now, by notice of motion filed on 31 July 2020, Bingo seeks leave to amend its Response to re-plead an apportionable liability defence.
In its proposed Response, Bingo seeks to plead that any contamination in the aggregate came from materials supplied to it by one or other of 710 "Customers" who delivered waste generated from building and demolition activities to Bingo's recycling facilities.
Thus, in the proposed Response Bingo asserts:
"[Bingo says] that between 1 May 2017 and 1 July 2017 each of the persons identified in Annexure A to the affidavit of Dorian Kratsas sworn on 17 July 2020 (the Customers) was the person responsible for delivering waste to [Bingo's waste transfer and processing facility at Kembla Grange] generated from building and demolition activities … by way of a motor vehicle bearing the registration number listed in Annexure A". [3]
Mr Kratsas is the solicitor for Bingo. The annexure to Mr Kratsas's affidavit lists 710 motor vehicle registration numbers and the name of the person or company recorded at Transport for New South Wales as the registered owner of those vehicles.
In his affidavit, Mr Kratsas states that the named parties are "Customers who, in the period 1 May 2017 to 1 July 2017 delivered waste to [Bingo's facility] generated from building and demolition activities". However, the list is in fact no more than a list of the registration numbers of vehicles "from information held by [Bingo] in respect of the Customers" being "the registration number of at least one vehicle associated with that Customer" to which has been added "information provided by Transport New South Wales … in response to a subpoena issued at [Bingo's] request". [4]
Bingo then seeks to allege that:
1. "portions of" the waste delivered by "the Customers" to Bingo's facility were "crushed, screened and processed … to generate recovered aggregate that was supplied to GC Group" [5] ;
2. Bingo did not itself "generate any waste from which the recovered aggregate supplied to GC Group was created" [6] ;
3. Bingo was "unaware of the buildings and structures, and the composition of the buildings and structures" from which its Customers generated waste [7] and had "no opportunity to inspect or know" whether such waste contained contaminated material [8] ;
4. "each Customer" knew or should have known whether waste delivered to Bingo was likely to contain contaminated material [9] ;
5. "each Customer" knew that waste delivered to Bingo was likely to be recycled into aggregate "that would be supplied to third parties" [10] ;
6. it was "reasonably foreseeable" that if Bingo supplied waste supplied by Customers that was contaminated to third parties, such third parties would be likely to suffer loss and damage [11] ;
7. "each Customer" therefore owed a duty of care to third parties who would be supplied by Bingo with recovered aggregate generated from waste supplied by the Customers not to deliver contaminated material to Bingo and not to transport waste in breach of s 143 of the Protection of the Environment Operations Act 1997 (NSW) [12] ;
8. "to the extent that" the contaminated aggregate supplied by Bingo to GC Group came from waste supplied to Bingo "by a Customer" that Customer was in breach of specified contractual and statutory obligations [13] ;
9. to the extent that Bingo is found liable to GC Group, Bingo and "each of the Customers" was therefore a "concurrent wrongdoer for the purposes of section 35A [sic]" of the Act and that Bingo's liability to GC Group ought be limited under s 35(1) of the Act [14] .
Alternatively, Bingo seeks to plead that some of the contaminated aggregate supplied to GC Group was supplied while its predecessor, Wollongong Recycling and Building Supplies Pty Ltd ("WRBS") had responsibility for the waste processing facility and that WRBS is also a concurrent wrongdoer.
The parties' submissions were not directed to the manner in which Bingo seeks to plead its case concerning WRBS. These reasons are not concerned with that aspect of Bingo's proposed response.
[3]
Part 4 of the Act
Section 34(1) of the Act defines an "apportionable claim" as follows:
34 Application of Part
(a) a claim for economic loss or damage to property in an action for damages (whether in contract, tort or otherwise) arising from a failure to take reasonable care, but not including any claim arising out of personal injury,
(b) a claim for economic loss or damage to property in an action for damages under the Fair Trading Act 1987 for a contravention of section 42 of that Act (as in force before its repeal by the Fair Trading Amendment (Australian Consumer Law) Act 2010) or under the Australian Consumer Law (NSW) for a contravention of section 18 of that Law.
Section 34(2) of the Act defines "concurrent wrongdoer" as:
… a person who is one of two or more persons whose acts or omissions (or act or omission) caused, independently of each other or jointly, the damage or loss that is the subject of the claim.
Section 35(1) of the Act provides:
35 Proportionate liability for apportionable claims
(1) In any proceedings involving an apportionable claim -
(a) the liability of a defendant who is a concurrent wrongdoer in relation to that claim is limited to an amount reflecting that proportion of the damage or loss claimed that the court considers just having regard to the extent of the defendant's responsibility for the damage or loss, and
(b) the court may give judgment against the defendant for not more than that amount.
Section 35A of the Act provides:
35A Duty of defendant to inform plaintiff about concurrent wrongdoers
(1) If -
(a) a defendant in proceedings involving an apportionable claim has reasonable grounds to believe that a particular person (the other person) may be a concurrent wrongdoer in relation to the claim, and
(b) the defendant fails to give the plaintiff, as soon as practicable, written notice of the information that the defendant has about -
(i) the identity of the other person, and
(ii) the circumstances that may make the other person a concurrent wrongdoer in relation to the claim, and
(c) the plaintiff unnecessarily incurs costs in the proceedings because the plaintiff was not aware that the other person may be a concurrent wrongdoer in relation to the claim,
the court hearing the proceedings may order that the defendant pay all or any of those costs of the plaintiff.
(2) The court may order that the costs to be paid by the defendant be assessed on an indemnity basis or otherwise.
[4]
Leave should be refused
GC Group contends that Bingo should not be given leave to make the proposed amendments for a number of reasons. I find it only necessary to deal with one as, in my opinion, it is decisive and itself a reason to refuse Bingo the leave it seeks.
The difficulty is that the parties identified by Bingo as purported "concurrent wrongdoers" are no more than the registered owners of vehicles that attended its facility during the relevant period.
It does not follow from the fact that a vehicle owned by an identified person or company presented as Bingo's facility that such a person or company:
1. was the driver of the vehicle or was driving the vehicle on behalf of the company;
2. delivered any building waste [15] ;
3. was the owner of any delivered building waste;
4. was the party that generated any delivered building waste;
5. was the party that transported any delivered building waste; or
6. a party otherwise responsible for the delivery to Bingo of any building waste.
Bingo knows no more than the registration number of the vehicles that attended its facility during the period in question, and by reason of the material obtained on subpoena from Transport New South Wales, the names of the registered owners of those vehicles.
Mr Larkin SC, who appeared with Ms Ross for Bingo, accepted that Mr Kratsas's affidavit "merely refers to the registered proprietors of the vehicles" [16] and that "we can't point to a customer whom we know" caused loss to GC Group [17] .
It may be, as Mr Larkin submitted, that a defendant to an apportionable claim need only show that it is "one of two or more" persons whose acts or omissions have caused the plaintiff's loss and, at a pleading stage, may not be required to identify precisely the "other" causative parties; that is concurrent wrongdoers.
But, here, Bingo must show that it "is" [18] a concurrent wrongdoer; and that involves showing that there at least one other person who also "is" a concurrent wrongdoer.
But Bingo is one stage further removed. It does not identify customers who delivered building waste to its facility and assert that it is a concurrent wrongdoer with one or more of those customers. It does no more than identify 710 customers whose vehicles attended its facility.
In those circumstances, I cannot see how Bingo can allege that any one of the those 710 customers - let alone "each" of them [19] - "is" a person whose acts or omissions caused the loss the subject of GC Group's claim and thus a "concurrent wrongdoer" for the purpose of s 34(2) of the Act.
Bingo does not and cannot know this. And without knowing this, Bingo cannot establish, and in my opinion should not be permitted to assert, that any of the 710 named parties is a concurrent wrongdoer.
It would in those circumstances be an abuse of the Court's process for Bingo to make this allegation.
In Tomlinson v Ramsey Food Processing Pty Ltd [20] the High Court stated:
"Although insusceptible of a formulation which comprises closed categories, abuse of process is capable of application in any circumstances in which the use of a court's procedures would be unjustifiably oppressive to a party or would bring the administration of justice into disrepute." [21]
It would in my opinion be unjustifiably oppressive to GC Group to require it to respond to the concurrent wrongdoer defence that Bingo seeks to make out in its proposed Response. It would also bring the administration of justice into disrepute in that it would permit Bingo to articulate a defence that it cannot make out and which would be amenable to summary disposal.
Accordingly, I refuse to grant Bingo leave to amend its Response in the manner proposed.
It is not in these circumstances necessary for me to deal with the other bases on which GC Group sought to resist Bingo's application for leave to amend.
One matter that was debated before me was whether a defendant to an apportionable claim must show that the plaintiff has a cause of action against the parties named by the defendants as concurrent wrongdoers.
There is very recent Court of Appeal authority that this is necessary. [22]
Mr Larkin submitted that this authority was obiter, "made with insufficient attention to the clear words of the statute and without sufficient analysis" and contrary to High Court authority. [23]
Nonetheless, as I have set out above, Bingo did seek to plead in its proposed Response that its customers owed third parties, such as GC Group [24] , a duty of care, albeit without alleging that GC Group was relevantly vulnerable. That omission was said by GC Group also to be fatal to Bingo's amendment application, with reference being made to authority to the effect that such an allegation is essential in a claim for damages for economic loss. [25]
There was also debate as whether GC Group's contract claim was an "apportionable claim" with reference made to authority for the proposition that in order to be an apportionable claim an element of the cause of action must be an absence of reasonable care. [26] However, as there no dispute that GC Group's claim under the Australian Consumer Law was apportionable, [27] this factor would not have been decisive.
[5]
Conclusion
The defendants' notice of motion of 31 July 2020 is dismissed.
On the face of it, costs should follow the event. If either party contends for a different result, that party should let my Associate have brief written submissions by 5.00 pm on 9 October 2020. I will deal with any dispute on the papers.
The matter will be listed for further directions in the Technology and Construction List on 9 October 2020.
GC Group Company Pty Ltd v Bingo Holdings Pty Ltd [2020] NSWSC 598.
At C45.
Kratsas at [3] and [4].
C48.
C49.
C50.1.
C50.5.
C50.4.
C51.
C52.
C53 & 54 - s 143 creates an offence for the unlawful transport of waste.
C66.
C69.
As opposed to, say, timber or green waste: The Gardenmakers Pty Limited, Unanderra Timber & Joinery Pty Limited and Albion Park Landscaping Supplies Pty Limited are named in Mr Krastas's list.
T30.30.
T10.32.
This is the requirement of s 34(2) - cf s 35A which obliges a defendant to proceedings involving an apportionable claim to notify the plaintiff of persons it has reasonable grounds to believe "may" be a concurrent wrongdoer.
Trajkovski v Simpson [2019] NSWCA 52 at [195] (Brereton JA; Basten JA and Sackville AJA agreeing that the relevant party was not a concurrent wrongdoer); followed in Liprini v Hale [2020] NSWCA 130 at [105] (Macfarlan JA albeit in dissent); cf Woodhouse v Fitzgerald and McCoy (No 2) [2020] NSWSC 450 at [348] (Schmidt AJ whose attention was evidently not drawn to Trajkovski which was decided several weeks earlier).
Hunt & Hunt v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10 at [47] (French CJ, Hayne and Kiefel JJ; cf Bell and Gageler JJ at [91]).
Eg Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515; [2004] HCA 16 at [80] (McHugh J); Darling Downs Foods Pty Ltd v Bovis Lend Lease Pty Ltd [2010] QSC 409 at [28] (Martin J); CJD Equipment Pty Ltd v A&C Constructions Pty Ltd [2009] NSWSC 1362 at [245] (McDougall J); Chan v Acres [2015] NSWSC 1885 at [100]-[141] (McDougall J).
Rahme v Benjamin & Khoury Pty Ltd (2019) 100 NSWLR 550; [2019] NSWCA 211 at [135]-[136] (Macfarlan JA; Bathurst CJ and McCallum JA agreeing).
See s 34(1)(b) of the Act.
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Decision last updated: 06 October 2020