Ge v River Island Clothing Pty Ltd [2001] NSWSC 935 | Case summary

JUDGMENT 1 HIS HONOUR: Proceedings were commenced in the District Court by Yu Ge (an infant) by her tutor Tao Ge against River Island Clothing Pty Limited and Hydraulic Contracting and Supply Limited. The plaintiff alleged negligence by the defendants and claimed damages for serious personal injuries. 2 There are presently before this Court concerning that action proceedings by way of appeal from an order of Master Malpass and by way of notice of motion to set aside an order of Registrar Howe. It is convenient for present purposes if I refer to the defendants in the District Court action as the appellants and to the plaintiff in that action as the respondent. 3 Before considering the appeal and the motion brought by the appellants, it is necessary to refer to the events that have occurred since those proceedings were first instituted by the respondent in the District Court. 4 The respondent's claim in the District Court was expressed to be in the sum of $750,000. That amount corresponds with the limit set by s 44(1)(a)(ii) of the District Court Act. The respondent's claim progressed through the District Court until eventually it was allocated a time for hearing in the week commencing 24 September 2001. After that hearing time had been fixed, the solicitors for the respondent wrote to the appellants' solicitors seeking consent to an extension of the District Court's jurisdiction pursuant to s 51(2) of the District Court Act. The appellants, or at least the first appellant, declined to give consent and to sign the necessary memorandum under that sub-section. The respondent's solicitors then applied to the District Court to vacate the hearing date that had been set but that application was refused. 5 What next occurred was that the solicitors for the respondent made application to this court on summons seeking an order that the proceedings then pending in the District Court should be transferred to the Common Law Division of the Supreme Court. Registrar Howe made the order sought on 6 August 2001. After that order was made, but on the same day, the respondent, through her counsel, applied for an order transferring the proceedings back to the District Court. That application was opposed and the registrar declined to entertain it, apparently upon the basis that the appellants had been given no prior notice that such an application was going to be made. 6 The application to remit the matter to the District Court did, however, come before Master Malpass on 12 September 2001. On that date the Master acceded to the respondent's application, remitting the proceedings to the District Court. 7 It is common ground on the present appeal and on the present motion that the effect of the order made by Master Malpass remitting the matter to the District Court was to return the action to the District Court with unlimited jurisdiction. This was because of the effect of s 44 of the District Court Act to which I shall presently return. The matter now awaits hearing in the District Court, although, on the application of the appellants, his Honour Acting Judge Nash made an order staying proceedings until the matters presently before me have been determined. 8 On the notice of motion concerning the order made by Registrar Howe on 6 August last, the appellants seek an order that the registrar's order be set aside. By the notice of appeal from the order made by Master Malpass, the appellants seek that the order of the master be set aside. A further order is sought, on the appeal from the order of the master, presumably in the alternative, that the proceedings transferred to the District Court by the master should stay in the District Court but with a monetary jurisdictional limit of $750,000. 9 At the hearing before me I have had the benefit of thorough submissions by counsel from both ends of the Bar table. I do not propose to address the various submissions made in an exhaustive fashion but to deal with the principal submissions upon which I consider the outcome of both the appeal and the motion are to be determined. 10 Mr Graves of Senior Counsel submitted firstly that the procedures adopted by the respondent in seeking the transfer from the District Court and then back to it constituted an abuse of the process of this court, achieving an objective that could not otherwise have been achieved of vesting the District Court with unlimited jurisdiction in this case, in the absence of the consent of both the appellants. 11 Whilst there is no direct evidence to this effect, it was submitted that the inference to be drawn from the respondent's conduct is that the only purpose in coming to this court in the first place was to avoid the appellant's opposition to unlimited jurisdiction in the District Court, but still proceed to trial in that court, and it was further submitted that the provisions of the District Court Act were used for a purpose for which they were not intended and in a way which was outside the scope of that statute. 12 Consideration of the above submission requires consideration of certain of the provisions of the District Court Act. 13 I referred earlier to s 44 of that statute and to the limit set by s 44(1)(a)(ii). I also referred earlier to the consent jurisdiction provision contained in s 51 of that Act. 14 The effect of those two provisions is that a plaintiff cannot commence proceedings in the District Court (other than concerning a motor accident claim) for an amount in excess of $750,000 unless a Memorandum of Consent is filed in court duly signed pursuant to s 51(2). There are, however, circumstances in which the District Court can award damages in excess of $750,000. The court has such jurisdiction where proceedings are transferred to it by the Supreme Court. Section 44 of the District Court Act relevantly provides: "44. (1) Subject to this Act, the Court has jurisdiction to hear and dispose of the following actions - …….. (e) any proceedings transferred to the Court under section 143(1), irrespective of the amount (if any) claimed in those proceedings." 15 Part III Div 9 provides for the transfer of proceedings from or to the Supreme Court. Section 143 deals with transfers from the Supreme Court to the District Court and s 145 deals with transfers from the District Court to the Supreme Court. In their present form, following the amending Act No. 58 of 1997, these two sections provide as follows: "143. (1) Where the Supreme Court is of opinion that any proceedings that are pending in the Supreme Court could properly have been commenced as an action in the Court, the Supreme Court may, if it thinks fit, on the application of any party or of its own motion, order that those proceedings be transferred to the Court sitting at such proclaimed place as the Supreme Court thinks fit. (2) Where the Supreme Court is of opinion that any proceedings that are pending in the Supreme Court could properly have been commenced as proceedings under Subdivision 2 of Division 8 in the Court, the Supreme Court may, if it thinks fit, on the application of any party or of its own motion, order that those proceedings be transferred to the Court sitting at such proclaimed place as the Supreme Court thinks fit. (3) In considering any limitation on the jurisdiction of the District Court for the purposes of determining whether proceedings can be transferred under this section, the Supreme Court is to have regard to the limitation as in force when the determination is made (as though that limitation had been in force at the time the proceedings were commenced in the Supreme Court). (4) If the plaintiff in the proceedings applies for a transfer of the proceedings under this section, the defendant is not permitted to oppose the application. The Supreme Court, however, for any reason appearing to it sufficient (but having due regard to the provisions of section 145), may decline to make the order sought. (5) Without limiting any power of the Supreme Court under this section, the Supreme Court may, at any time after the commencement and before the hearing of the action, consider any action for damages in respect of personal injury or death, in order to determine whether an order under this section transferring the proceedings ought to be made. Having considered the action, the Supreme Court is to make such an order unless: (a) in the case of a motor accident claim, the Supreme Court is satisfied that the amount to be awarded to the plaintiff in the case, if successful, would be likely to exceed $1,000,000 and that the case involves complex legal issues or issues of general public importance, or (b) in any other case, the Supreme Court is satisfied that the amount to be awarded to the plaintiff in the case, if successful, would be likely to exceed $750,000 or that there is other sufficient reason for trying the action in the Supreme Court. "145. (1) Proceedings may, upon the application of a party, be removed into the Supreme Court by order of the Supreme Court upon such terms as to payment of costs, giving security for the amount claimed or costs, or otherwise, as the Supreme Court thinks fit. (2) An action for damages in respect of personal injury or death (other than a motor accident claim) may be so removed only if the Supreme Court is satisfied that the amount to be awarded to the plaintiff in the case, if successful, would be likely to exceed $750,000 or that there is other sufficient reason for trying the action in the Supreme Court. (3) A motor accident claim may be so removed only if the Supreme Court is satisfied that the amount to be awarded to the plaintiff in the case, if successful, would be likely to exceed $1,000,000 and that the case involves complex legal issues or issues of general public importance." 16 It is to be observed, considering firstly s 145, that an action may be transferred to the Supreme Court only if the Supreme Court is satisfied that the amount to be awarded to the plaintiff, if successful, "would be likely to exceed $750,000", or if there be present some other sufficient reason. So it is that on the application which the respondent made to this court before the registrar made the order it was necessary that he be satisfied, as presumably he was, that the plaintiff's damages were likely to exceed $750,000. 17 It is submitted that once the order here had been made in the Supreme Court under s 145, it was not appropriate to use s 143 in the manner in which it was used in this case and that such use was an abuse. It was further submitted that s 143 did not in its language make provision for the transfer to the District Court of proceedings which had first been transferred to the Supreme Court under s 145. 18 Mr Cleary submitted that there has been no abuse of the processes of the court. The respondent had a claim which, if it was to be pursued for its full value, could only be pursued in the District Court after the intervention of the Supreme Court. The claim had some urgency to it, as supported by psychiatric opinion evidenced on affidavit, and the best way of addressing the element of urgency was in having the cause heard in the District Court where there was a hearing date allocated. He submitted that what was done was done by appropriate use of court processes. 19 As was observed by Mason CJ in Rogers v The Queen (1994) 181 CLR 251: "The circumstances in which abuse of process may arise are extremely varied, and it would be unwise to limit those circumstances to fixed categories." 20 It does seem to me that the present case however does constitute such an abuse. Notwithstanding Mr Cleary's earnest submissions to the contrary, the submissions advanced by Mr Graves ought, in my opinion, to prevail. It seems to me that what was done involved the use of the transfer processes provided for in Pt III Div 9 of the District Court Act in a manner that was never intended, and in a manner which deprived the appellants of their legitimate expectation that absent consent to the unlimited jurisdiction of the District Court, that court's jurisdiction would be limited to $750,000. 21 However there is another basis upon which, in my opinion, the appellants are entitled to relief. It was submitted that the master erred in law in remitting the matter to the District Court, and I consider this submission has been established. 22 The transcript recording what happened before the master on 12 September 2001 is before me. It is brief and the parties have informed me that it is not supplemented by any separate statement of reasons from the master as to why he took the course that he did. One thing seems to be clear and that is that the master did not have the benefit of competing submissions as I have done concerning the construction of s 143 and in particular the significance of the language employed in s 143(1). 23 However, the transcript records that when the master made the order he also gave the parties liberty to approach the list clerk for the purposes of seeing if there was a judge available to entertain an application for a declaration as to the limit of the District Court's jurisdiction once the matter had been remitted to it pursuant to the master's order. 24 Whilst it is common ground before this Court now that the effect of s 44(1)(e) was to cloak the District Court with unlimited jurisdiction by reason of the master's order, this was not a matter that the master decided before determining whether the order for transfer should be made. It seems to me that even if s 143(1) was to be regarded as permitting of the making of the order made by the master in the circumstances in which it was made, s 143(4) required the master to consider before making such order whether, in all the circumstances, it was proper to remit the matter. One matter to be considered in this context was the extent of the jurisdiction of the District Court once the matter was remitted, and it seems clear that the master did not address this, because he gave the parties liberty to go to the list clerk to seek out a hearing before a judge on this very issue. 25 In my opinion, it was not appropriate to remit the matter to the District Court. 26 The operation of s 143(1) is enlivened where the Supreme Court is of the opinion that any proceedings pending in this court "could properly have been commenced as an action in the [District] Court." One of the matters to be addressed in determining whether the proceeding could properly have been commenced in the District Court is the amount claimed. This is self-evident and, in any event, this construction is in sympathy with s 143(3). 27 Could these proceedings "properly have been commenced as an action in the [District] Court"? Absent the filing of a Memorandum of Consent under s 51, that question must, in my opinion, be answered in the negative. That is so because it was established on the transfer application under s 145 that the claim was one in which, in the event that the plaintiff succeeded, she would be likely to recover damages in excess of $750,000. This was not a case to be transferred to the District Court. 28 Mr Cleary submitted there is tension between s 143(1) and s 44(1)(e) of the District Court Act. I do not think that this is so because, although the effect of the making of an order under s 143(1) gives the District Court unlimited jurisdiction by reason of s 44(1)(e), before any order for transfer is made under s 143(1), the Supreme Court has to consider under that section whether such jurisdiction should be conferred. No doubt there would be cases in which at the time of the making of the order under s 143, the size of the claim was not fully appreciated. In such a case where ultimately damages were assessed in excess of $750,000, s 44(1)(e) had the effect of ensuring those damages were recoverable to their full extent. 29 For the reasons stated, I am of the opinion that the appeal from the master should succeed and the orders that he made should be set aside. 30 I now address the motion concerning the order made by the registrar. The application to the registrar was, viewed by itself, a proper application, and the registrar satisfied himself that the case was one in which damages were likely to exceed $750,000. It was proper that the matter be transferred to this court, and in my opinion it is only the later transfer back to the District Court which ought to be disturbed. 31 Consequently, I decline to set aside the order made by the registrar. 32 In the result, I make the following orders:

Ge v River Island Clothing Pty Ltd

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