Hodgson v Dimbola Pty Ltd t/as Towers Removals and Workers Compensation Nominal Insurer

Court of Appeal (ACT)|2010-08-31|Before: Gray P, Marshall JJ, Refshauge J, Keane JA, Holmes JA, Wilson J

The applicant, Glenn Joseph Hodgson, applied for leave to appeal from a decision of Refshauge J refusing to extend the time to commence proceedings in respect of an accident which occurred on 6 or 7 August 2003. In accordance with a direction by Gray P, the application was to be heard together with the appeal.

At the hearing Mr Ryan, counsel for the applicant, submitted in reliance on the case of Castillon v P & O Ports Ltd (No. 2) [2007] QCA 364; [2008] 2 Qd R 219 that leave was not in fact required for this appeal. That case involved a defendant's appeal against an order extending a limitation period. The argument concerned, among other things, whether a second application for an extension of a limitation period might be barred by issue estoppel, but it did not consider whether leave to appeal from a decision extending or refusing to extend a limitation period was necessary. On the contrary, Keane JA, with whom Holmes JA and Wilson J agreed, simply noted at [2]:

The defendant seeks leave to appeal against this decision pursuant to s. 118(3) of the District Court of Queensland Act 1967, leave being necessary because the decision of the learned primary judge was not a final judgment.

The accident occurred when the applicant fell off a truck that he was unloading in Queensland on or about 7 August 2003.
Proceedings were commenced in the ACT Supreme Court on 27 October 2006.
It is common ground that s 11 of the Limitation of Actions Act 1974 (Qld) (the Limitation Act), which applies to the applicant's cause of action, limits the period within which proceedings may be instituted in respect of the applicant's cause of action for personal injury to a period of three years from the date of the accident.
Section 31 of the Limitation Act provides for an extension of that limitation:

31 Ordinary actions

(1) This section applies to actions for damages for negligence, trespass, nuisance or breach of duty (whether the duty exists by virtue of a contract or a provision made by or under a statute or independently of a contract or such provision) where the damages claimed by the plaintiff for the negligence, trespass, nuisance or breach of duty consist of or include damages in respect of personal injury to any person or damages in respect of injury resulting from the death of any person.

(2) Where on application to a court by a person claiming to have a right of action to which this section applies, it appears to the court -

(a) that a material fact of a decisive character relating to the right of action was not within the means of knowledge of the applicant until a date after the commencement of the year last preceding the expiration of the period of limitation for the action; and

(b) that there is evidence to establish the right of action apart from a defence founded on the expiration of a period of limitation;

the court may order that the period of limitation for the action be extended so that it expires at the end of 1 year after that date and thereupon, for the purposes of the action brought by the applicant in that court, the period of limitation is extended accordingly.

(3) This section applies to an action whether or not the period of limitation for the action has expired -

(a) before the commencement of this Act; or

(b) before an application is made under this section in respect of the right of action.

Section 30 of the Limitation Act defines what amounts to a material fact relating to a right of action:

30 Interpretation

(1) For the purposes of this section and sections 31, 32, 33 and 34 -

(a) the material facts relating to a right of action include the following -

(i) the fact of the occurrence of negligence, trespass, nuisance or breach of duty on which the right of action is founded;

(ii) the identity of the person against whom the right of action lies;

(iii) the fact that the negligence, trespass, nuisance or breach of duty causes personal injury;

(iv) the nature and extent of the personal injury so caused;

(v) the extent to which the personal injury is caused by the negligence, trespass, nuisance or breach of duty;

(b) material facts relating to a right of action are of a decisive character if but only if a reasonable person knowing those facts and having taken the appropriate advice on those facts, would regard those facts as showing -

(i) that an action on the right of action would (apart from the effect of the expiration of a period of limitation) have a reasonable prospect of success and of resulting in an award of damages sufficient to justify the bringing of an action on the right of action; and

(ii) that the person whose means of knowledge is in question ought in the person's own interests and taking the person's circumstances into account to bring an action on the right of action;

(c) a fact is not within the means of knowledge of a person at a particular time if, but only if -

(i) the person does not know the fact at that time; and

(ii) as far as the fact is able to be found out by the person - the person has taken all reasonable steps to find out the fact before that time.

(2) In this section -

appropriate advice, in relation to facts, means the advice of competent persons qualified in their respective fields to advise on the medical, legal and other aspects of the facts.

It was common ground before Refshauge J that the effect of the Limitation Act was that the Court could only extend the limitation period for one year after the material fact of a decisive character came within the applicant's knowledge. Since the applicant commenced his current application on 27 October 2006, the "material fact of a decisive character" had to have come within the means of knowledge of the applicant after 27 October 2005.

During the course of the applicant's submissions, it became clear that Mr Ryan was contending that the only material fact of a decisive character in the present matter was the applicant's receipt of what was said to be competent legal advice. Mr Ryan contended that material facts only become facts of a decisive character once appropriate advice has been provided to a proposed plaintiff.
Mr Ryan noted the presence in s 30(1)(b) of the words "having taken the appropriate advice on those facts", and the definition of "appropriate advice" as meaning the advice of a "competent person". Mr Ryan contended that Mr Hodgson did not receive competent advice on his claim until after 27 October 2005.
Section 30(1)(b) focuses initially on the existence of "material facts relating to a right of action" but adds that those facts will only be decisive if a reasonable person knowing those facts and having taken advice about them would regard them as justifying the bringing of an action. There first must be "material facts relating to a right of action", such as those identified in s 30(1)(a). The receipt of legal advice, in itself, is not a material fact relating to a right of action. The High Court has said as much in Do Carmo v Ford Excavations Pty Ltd [1984] HCA 17; (1984) 154 CLR 234 (Do Carmo); see especially at 245-246 per Wilson J, 249-252 per Deane J, 253-254 per Dawson J (with whom Brennan J agreed).
In Do Carmo the High Court authoritatively interpreted the New South Wales provision equivalent to s 30(a)(ii) of the Limitation Act as referring only to the acts or omissions alleged to constitute a tort and to legal concepts or causes of action. The equivalent provisions to the Limitation Act are ss 57 and 58 of the Limitation Act 1969 (NSW).
Wilson J gave detailed consideration to broadly comparable legislation in other jurisdictions and to the submissions put to the court. He said (at 243-245):

(a) Ignorance of a cause of action.

The first of these questions is of fundamental importance to the operation of Pt III of the Act. It is one which has been thoroughly agitated, in relation to broadly comparable legislation, in a number of jurisdictions over the past decade and the Court is fortunate to have the benefit of such extensive consideration. In Smith v. Central Asbestos Co. an appeal from the Court of Appeal, a majority of their Lordships (Lord Pearson, Lord Simon of Glaisdale and Lord Salmon) construed the Limitation Act 1963 (U.K.) so as to exclude the legal consequences of a fact or facts from the category of material facts. The strength of the views of their Lordships in this regard is not affected by the fact that Lord Pearson took a view of the facts which led him to join Lord Reid and Lord Morris of Borth-y-Gest in the decision of the case. Lord Pearson said:

"It seems to me the Parliament has drawn the line between ignorance of facts (material and decisive facts) and failing to draw the conclusions which a reasonable man, with the aid of expert advice, would have drawn from those facts as to the prospect of success in an action. If the plaintiff did not know one or more of the material and decisive facts, his lateness in bringing the action is excused. If he knew all the material and decisive facts, but failed to appreciate his prospects of success in an action because he did not take expert advice or obtained wrong expert advice, his lateness in bringing the action is not excused."

In McIntyre v. Armitage Shanks Ltd. the House of Lords held unanimously that the Prescription and Limitation (Scotland) Act 1973 did not assist a plaintiff to bring an action where he learned too late that the facts already known to him gave rise to a good cause of action. Their Lordships were emphatic that in speaking of material facts that Act was concerned with knowledge or ignorance of facts in the ordinary sense, not with the legal consequences of those facts. Lord Russell of Killowen expressed the point succinctly in these words:

"The primary question in this appeal is whether the existence in law of the right of action can be a relevant material fact. I cannot, my Lords, see how the existence in law of the right of action in question in [sic] capable of being described as a 'material fact relating to that right of action'. That phrase presupposes the existence in law of the right of action, and the reference to material facts relating to that which is assumed to exist can only be a reference to matters other than that existence."

In the course of their speeches, several of their Lordships referred with approval to the reasoning of the "interpretative majority" (as it was described) of the House of Lords in Smith v. Central Asbestos Co.

A similar view was taken of the Victorian legislation by the Full Court of the Supreme Court of Victoria in Harris v. Gas and Fuel Corporation (Vict.), overruling the decision of Gowans J. in Evans v. Repco Transmission Co. Pty. Ltd.. Likewise, in Queensland, W. B. Campbell J. (as he then was) in Ex parte Bolewski held that the failure of solicitors, possessed of full knowledge of all relevant circumstances, to advise a client that he has a right of action is not "a material fact of a decisive character relating to the right of action" within the meaning of s. 31(2) of the Limitation of Actions Act 1974 (Q.).

...

The concept of a "cause of action" would seem to be clear. It is simply the fact or combination of facts which gives rise to a right to sue. In an action for negligence, it consists of the wrongful act or omission and the consequent damage: cf. Cooke v. Gill; Read v. Brown; Trower and Sons Ltd. v. Ripstein; Board of Trade v. Cayzer, Irvine & Co. Ltd.; Shtitz v. C.N.R.; Williams v. Milotin. Knowledge of the legal implications of the known facts is not an additional fact which forms part of a cause of action. Indeed, a person may be well appraised of all of the facts which need to be proved to establish a cause of action but for want of taking legal advice may not know that those facts give rise to a right to relief. [references omitted]

The issues involved in this appeal and the relevant facts and legislative provisions are set out in the judgment of Wilson J. I agree, for the reasons which he gives, with Wilson J.'s conclusion that ignorance of the existence of a cause of action is not, in itself, ignorance of a material fact for the purposes of ss. 57 and 58 of the Limitation Act 1969 (N.S.W.) ("the Act"). The ignorance of a material fact to which those sections refer is, in my view, ignorance of factual matter in the ordinary sense and not ignorance either of the law itself or of the legal consequences of the material facts.

Dawson J, with whom Brennan J agreed, said (at 253-254):

Despite the inherent ambiguity in s. 57(1)(b)(i), I think that the reference to "the fact of the occurrence of negligence", when read in context, is clearly enough a reference to facts rather than to a cause of action which arises as a matter of law upon those facts.

In the first place, s. 57(1)(b) initially speaks of "material facts relating to a cause of action". If the reference to negligence as a material fact in par. (i), which follows, was a reference to the cause of action, the initial words would have to be construed as embracing a cause of action relating to a cause of action - a construction which is clearly inapt. Moreover, par. (i) itself refers to "the fact of the occurrence of negligence ... on which the cause of action is founded". It is no less inapt to speak of a cause of action on which a cause of action is founded. And the use of the word "facts" rather than some wider word such as "matters" or "circumstances" is itself an indication of the construction which the language to my mind suggests.

If the reference to negligence in par. (i) were a reference to the cause of action, then the inclusion of par. (iii) as a material fact would be inappropriate. Paragraph (iii) refers to "the fact that the negligence ... causes personal injury" but in a case of negligence in which personal injury constitutes the damage, that damage is a part of the cause of action. It may be added that each of pars. (ii) to (v) which, together with par. (i), describe what may constitute material facts, deals with facts as that word is ordinarily understood and not with legal concepts, thus suggesting that the proper construction to be placed upon par. (i) is that it similarly deals with facts in the form of acts or omissions which may found a cause of action rather than with the cause of action itself.

If the alternative construction of par. (i) were adopted, the result would necessitate a highly artificial construction of s. 57(1)(c), which provides that material facts as defined are of a decisive character if, amongst other things, they show that an action on the cause of action would have a reasonable prospect of success. If the existence of a cause of action in negligence were itself a material fact, s. 57(1)(c) would have to be construed as contemplating a cause of action showing that an action on the cause of action would have a reasonable prospect of success - a construction which can hardly have been intended.

For all of these reasons it seems to me that the reference to material facts in par. (i) of s. 57(1)(b) does not include a reference to a cause of action in negligence but is rather a reference to the facts which constitute the acts or omissions, including those facts which are necessary to show the negligent character of those acts or omissions, upon which such a cause of action might be founded. In reaching this conclusion I have derived both assistance and comfort from Smith v. Central Asbestos Co. which deals with the Limitation Act 1963 (U.K.) and from the other decisions which deal with legislation which, together with the New South Wales Act, derives, to a greater or lesser extent, from the United Kingdom legislation (McIntyre v. Armitage Shanks Ltd.; Harris v. Gas and Fuel Corporation (Vict.); Ex parte Bolewski). Because the particular wording of the Acts in question varies it is sufficient to say that similar considerations have led me to a conclusion similar to that reached in each of these cases. [references omitted]

Murphy ACJ dissented.
Mr Ryan's argument as to why this Court should not follow and apply the carefully reasoned decision of the majority of the High Court was encapsulated in the following submission:

the applicant is seeking to persuade the court that the various High Court authorities which I've referred to in my arguments in recent times, in recent years subsequent to Do Carmo require that with a beneficial interpretation of a provision which is designed to provide relief, given other factors of course such as prejudice, the relief of the raising of the bar, the provision of the practicalities of justice, which of course ultimately embraces concepts such as prejudice, require that traditionally the view, the opinion that stated law such that proper advice is assumed by the court in considering - the provision of proper advice is assumed by the court in considering this particular compendium of sections ought apply only - well, ought not apply because it denies the applicant the benefit of a beneficial facultative provision.

It has been necessary to set out in detail the reasoning of the High Court in Do Carmo because the confusing and unsound submissions put by Mr Ryan did not attempt to analyse that reasoning. Rather Mr Ryan, as best we understand his submissions, invited us to ignore not just the High Court's views but also the plain words of the legislation in order to give effect to the legislation's "remedial" or "beneficial facultative" nature. He rejected an interpretation proposed by the court in reliance on the words of the legislation on the grounds that it was "not an interpretation that accommodates a beneficial interpretation of the sections ... [but was] an analysis that ... obviously has an appeal to certain legal minds".
Apart from noting Mr Ryan's reliance on question-begging and ad hominem argument, the Court rejects his substantive argument by making two points. First, a close reading of the decision in Do Carmo and the cases upon which the majority relied indicates that the High Court does not reject a "beneficial" approach to interpreting the legislation, but rather accepts it as appropriate. Secondly, it is for the High Court alone to determine whether one of its previous decisions is to be departed from or overruled: Garcia v National Australia Bank Ltd [1998] HCA 48; (1998) 194 CLR 395 at [17] per Gaudron, McHugh, Gummow and Hayne JJ. For our part, this Court proposes to follow the decision of the majority in Do Carmo and interpret the equivalent Queensland legislation accordingly.
Under the legislative scheme, facts are assessed to be material ones of a decisive character by examining situations in which it is assumed that appropriate advice has been provided. It is not the giving of the advice itself that is a material fact of a decisive character but the facts constituting the cause of action; the discovery of the identity of the proposed defendant; the existence of a compensable personal injury caused by the facts giving rise to that cause of action; the extent of such an injury; and matters of that type going to the heart of the existence of a cause of action, the decisiveness of which must be assessed on the assumption of the receipt of appropriate advice about such facts.
It is beside the point whether the applicant received appropriate advice. The issue is whether, on the facts as the applicant knew them to be, a reasonable hypothetical person knowing those facts, and having taken appropriate advice on those facts, would regard them as material facts of a decisive character. The test is completely objective and not related subjectively to what the applicant received by way of legal advice. It is assumed for the purposes of the relevant definition that competent advice was given.
During the course of his submissions, Mr Ryan accepted, after questioning from the bench, that Do Carmo stood in the way of acceptance of his submissions that the provision of advice is itself a material fact of a decisive character. Mr Ryan then submitted that the material fact of a decisive character on which he relied was "the quality of the advice". That is a distinction without a difference. The quality of something that is not a material fact of a decisive character cannot transform that something into a material fact of a decisive character.
Mr Ryan sought finally to rely on the judgment of the NSW Court of Appeal in Royal North Shore Hospital v Henderson (1986) 7 NSWLR 283. However that judgment concerned the provision of medical advice about the causal link between the negligence of the defendant and the injury suffered by the plaintiff (itself a material fact under s 30(1)(a)(iii)), not legal advice about the prospects of an action brought in respect of injury suffered, and is accordingly of no assistance to the applicant.
We are satisfied, for the above reasons, that the primary judge correctly refused the application before him. The only remaining issue on the appeal was the contention that his Honour asserted wrongly that the second respondent's claim of prejudice was a strong one.
This is not a matter which should concern this Court of Appeal as his Honour expressly said at [80] of his reasons for judgment that it was an issue which he did not need to consider.

For the foregoing reasons, we are satisfied that this appeal has no prospects of success and accordingly leave to appeal is refused. The appellant is to pay the respondent's costs.

I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Court.

Court of Queensland Act 1967

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