1 PRIESTLEY JA:
Background to appeal .
By notice of motion dated 20 March 1998 filed in the District Court, Miss K.M. Holt applied for leave to commence proceedings against Mr D. Wynter for damages for injuries she had suffered in a car accident on 8 February 1992.
2 On 20 July 1998 Acting Judge Cantrill dismissed the application with costs.
3 On 22 March 1999 Powell and Giles JJA of this court granted Miss Holt leave to appeal. Powell JA gave short reasons in which he said that it was at least arguable on the face of Acting Judge Cantrill's judgment that he failed to apply the correct test in determining whether or not leave to commence proceedings should be granted to Miss Holt. He added that there was apparently some question abroad as to whether or not the approach suggested by this court in Salido v Nominal Defendant (1993) 32 NSWLR 524 was different from the approach suggested by the High Court in Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 and that adopted by this court more recently in Sydney City Council v Zegarac (1998) 43 NSWLR 195. These observations by Powell JA led to this appeal being heard by a court of five, immediately followed by the same court hearing a somewhat similar appeal in Seib v Morton in which judgment is to be delivered immediately after judgment in this case.
4 Summary of facts.
Miss Holt was sixteen when she was injured. She was a passenger in a car which collided with another car. The police traffic collision report was in evidence before Acting Judge Cantrill.
5 Miss Holt was taken to the Campbelltown Hospital by ambulance. The ambulance report and the hospital notes were in evidence before Acting Judge Cantrill.
6 On 20 May 1992 Miss Holt saw a solicitor at Campbelltown who undertook her claim for damages. With a letter dated 12 June 1992 he lodged a claim form with the NRMA in accordance with s 43(1) of the Motor Accidents Act 1988 (the Act). The NRMA returned the form to him saying it did not comply with the requirements for such forms. After some argument, the solicitor lodged an amended claim form on 24 August 1992.
7 In September he made an application for Legal Aid.
8 The amended claim form was lodged outside the six month period allowed by s 43 for giving notice of a claim. However, after some further argument, the NRMA by letter dated 8 December 1992 accepted that a full and satisfactory explanation for the delay had been provided pursuant to the then s 43(2). Thus the first delay in the matter, which seems to have been the fault of the solicitor, was overcome.
9 In its same letter dated 8 December 1992 the NRMA also said that their investigations had revealed that the vehicle at fault in the accident was insured by the GIO but that because of the sharing arrangement between the NRMA and GIO the NRMA would continue to manage the claim. The letter ended by asking for various particulars of Miss Holt's "present medical status" so that "we will be in a position to consider settlement of your client's claim".
10 To this point the case had gone ahead without undue problem. The NRMA had indicated it would make an offer of settlement after receiving further information. There was thus a reasonable prospect that Miss Holt could receive compensation for her injuries without the need for court proceedings.
11 However, in about November 1992 Miss Holt moved to Woy Woy and changed her solicitor. She left her case in this second solicitor's hands. There was delay in his getting the file from the first solicitor. From Miss Holt's point of view, nothing happened. In March or April 1993 she moved to St Helens Park. Then in January of 1994 she moved to Leeton. Each time she left forwarding addresses with Australia Post.
12 Miss Holt received a letter dated 10 May 1994 from the second solicitor asking her to sign an authority directing the first solicitor to transfer the files to the second solicitor. (This was addressed to the Woy Woy address.) Miss Holt annexed this letter to her affidavit filed in support of her application for extension of time. In another affidavit, by Mr Geddes, who later became her fifth solicitor, also filed in support of her application, the full contents of the second solicitor's file were annexed. This file contained a copy of a letter dated 17 May 1994, again to the Woy Woy address, enclosing a copy of a letter from the GIO of 12 May 1994. (The circumstances in which the GIO took over the conduct of the matter from the NRMA do not appear in the appeal papers. Although formally the party to the proceedings at all times remains Mr Wynter, for convenience I will from here on refer to Miss Holt's opponent as the GIO.) This letter offered $3,000 inclusive of costs in settlement of Miss Holt's claim. Miss Holt does not mention in her affidavit having received this letter.
13 In her affidavit Miss Holt also said that she rang the second solicitor's office from time to time but did not get past his office staff to speak to him personally until August 1995. At that time the second solicitor still did not have the file from the first solicitor. In a letter dated 24 August 1995 addressed to Miss Holt at her Leeton address, the second solicitor referred to his telephone conversation with Miss Holt and told her of the letter dated 12 May 1994 in which the GIO had made its offer in settlement. The solicitor advised her not to accept any offer until he had properly assessed her claim. (In this letter the solicitor asserted that Miss Holt had said to him that she had "not spoken to anyone from this office since 1992" and in one or two of his letters much later said she had not been in touch with him at all. This is different from her evidence which Acting Judge Cantrill accepted.)
14 The second solicitor did not refer in his letter of 24 August 1995 to the fact that s 52 of the Act (a) required a person commencing proceedings more than twelve months after the date on which the claim had to be made in accordance with s 43 to provide a full and satisfactory explanation to the court for the delay, and (b) further provided that the person was not entitled to commence proceedings in respect of a claim more than three years after the date on which the claim had to be made in accordance with s 43, except with the leave of the court.
15 The second solicitor wrote again to Miss Holt by letter dated 15 November 1995 enclosing a copy of a letter from the GIO dated 10 November 1995 in which the GIO proposed an informal settlement conference in December. At this time Miss Holt had become dissatisfied with the second solicitor and was in the course of retaining a third solicitor, which she did at the end of November 1995.
16 This third solicitor then set about obtaining the file from the second solicitor. By letter dated 17 July 1996 from the third solicitor to Miss Holt he told her that he had received part of the file from the second solicitor and had discovered that the remainder of it was with the first solicitor. He enclosed an authority for her to sign as a matter of urgency to get the remainder of the file from the first solicitor. The part of the file obtained from the second solicitor by the third solicitor had only been obtained after complaint by the third solicitor to the Law Society. It appears that the third solicitor obtained the balance of the file from the first solicitor in or about August 1996.
17 The office records of the third solicitor show that Miss Holt phoned his office twice in October 1996, speaking to a member of his staff, but not to him, inquiring about the progress of the case.
18 Nothing seems then to have happened until by letter dated 5 December 1996, apparently based on a standard form, the GIO wrote to the third solicitor saying that a medical examination had been arranged for Miss Holt. The last paragraph of this letter said:
" Please also note that pursuant to s 49 of the Act court proceedings in respect of your client's claim cannot be commenced or continued should your client fail to attend the above examination without reasonable excuse. "
19 The third solicitor received this letter on 9 December 1996 and by letter of the same date wrote to his client telling her of the medical examination.
20 The doctor nominated by the GIO examined Miss Holt on 4 March 1997. The GIO paid $481 to her to cover her costs of travelling to Sydney from Leeton and return, for the examination.
21 The third solicitor then arranged for Miss Holt to be examined by Professor Ryan for the purpose of a medico-legal report. Miss Holt was examined by Professor Ryan on 30 April 1997. She paid the expenses of this trip from Leeton herself. By letter dated 14 May 1997 the third solicitor sent a copy of Professor Ryan's report to the GIO.
22 A further medical appointment was made by the GIO for Miss Holt to attend Dr Roff on 4 June 1997. Her travelling expenses for this appointment were paid. Although, so far as I can see, what happened about this appointment does not appear in the appeal papers, both counsel in the appeal addressed this court on the basis it had taken place.
23 The next thing appearing in the appeal papers is that by letter dated 9 October 1997 the third solicitor wrote to Miss Holt telling her that "because the three year period [had] expired since her accident it [was] necessary for the leave of the court to be obtained before proceedings [could] be commenced". He also explained that because some of the delay in prosecuting her claim had occurred while the file had been with him it would be prejudicial to her chances of success if he were to continue acting. He said he had sent the file to a fourth solicitor who was expecting a telephone call from her. He also said that it was essential that matters should now move quickly.
24 Miss Holt then received a letter from the fourth solicitor dated 14 October 1997. She spoke to this solicitor by telephone. Following that conversation she asked Mr Geddes, a solicitor at Griffith, to act for her. He, her fifth solicitor, appears to have acted from then on with all due care and despatch. However, he did not receive the file from the fourth solicitor until 4 January 1998.
25 The GIO wrote to the fifth solicitor by letter dated 9 February 1998 saying that breach of duty of care was admitted but that leave to commence proceedings was opposed. (The court was told this without objection, although the letter is not in the appeal papers; it is mentioned in a chronology prepared by the fifth solicitor (Combined AB 206) for the hearing of the application for extension.) A month later, as mentioned at the outset of these reasons, the notice of motion for leave to commence proceedings was filed, which Acting Judge Cantrill later dismissed.
26 The trial judge's reasons.
In his reasons Acting Judge Cantrill accepted what Miss Holt said on a number of matters. He said he had no reason to doubt her evidence that over the period since the accident she had suffered pain and discomfort particularly in the knee and the sternum as a result of the accident. He also accepted that she had at all times maintained contact at least with the solicitors who acted for her, saying that although correspondence from the solicitors seemed to suggest that they did not accept that that was so, he accepted her version in that regard. Also, without making firm findings, he noted that on her evidence, " It may well be that if her damage were properly established she would have a substantial claim ". He said that, had the matter been litigated when it should have been, liability would not have been substantially in issue, and the issue at a trial would have been principally the degree of injury and disability and the amount of compensation.
27 He next noted that no evidence had been presented by the GIO, which had relied upon "the general prejudice" and also upon the assumption that because of "the lack of any apparent attempt by the plaintiff's various legal representatives to press the matter" the claim was either very small or at the least not one "justifying a substantial expenditure in medical treatment and examinations".
28 Next he mentioned that the GIO had relied upon Salido and Brisbane South as well as an unreported decision of the Court of Appeal (23 October 1997) Henricks v Agnew. The judge then went on to say that those cases could
" be summed up on the basis that a plaintiff seeking exercise of a discretion in waiving the time limit prescribed by the Motor Accidents Act in relation to the commencement of proceedings arising out of motor vehicles accidents bears some degree of onus to establish that there is such little prejudice against the defendant that I should in the exercise of my discretion grant an application to extend the period of time to commence proceedings. "
29 He next said that the evidence before him explained and excused Miss Holt personally from any responsibility for the lack of action in commencing the proceedings. He was of the view that the solicitors had some responsibility but was not prepared to find against them that they had been acting to the GIO's prejudice. Nevertheless,
" ... objectively insufficient had been done for a defendant to be able to say, 'Well, it does not really matter very much to me that the time is now some two years beyond the limitation period'. "
30 He went on:
" ... it seems to me that there is such prejudice or potential prejudice to the defendant if I were to grant this application that it ought not to be granted. "
31 Then, a little later, he concluded:
" Every legal professional is aware these days, who has anything to do with the Motor Accident Act, that the Act requires claims to be brought within a limited period and requires notice to be given of those claims. It must be a corollary to that, that if notice is given and then nothing much done a defendant is entitled to say at some stage, 'Obviously the plaintiff is not pressing this matter and I can disregard it'.
The defendant in my view has been prejudiced by the fact that until 1996 it had not been sufficiently apprised of the nature of the claim to arrange a medical examination on its part.
In those circumstances it seems to me appropriate that I should refuse the application. "
32 Argument in the appeal.
In the appeal Miss Holt's counsel accepted that for her to succeed a miscarriage of discretion had to be shown in accordance with the principles in House v The King (1936) 55 CLR 499. The principal point made in this respect was that the trial judge had shown in saying at one point that Miss Holt had " some degree of onus to establish that there is such little prejudice against the defendant that I should grant her application " that he was not applying the right test in exercising his discretion. Counsel submitted that the proper approach was that " It must be seen as fair and just that an extension of time be granted. That means it must appear there can be a fair trial ". Counsel also submitted that the trial judge had been influenced by a misunderstanding of the availability of medical evidence concerning Miss Holt's medical condition following the accident.
33 On the question of possible differences between Salido, Brisbane South and Zegarac, counsel said that he did not seek to contest the proposition, referred to by this court in Kinnas v Petricca, unreported, 1 December 1998, that this court has regularly regarded the High Court's decision in Brisbane South as applicable to the Motor Accidents Act. Counsel's submission was that
" Whilst there is no uniformity in the judgment in [Brisbane South] what they will come to by different routes is it must be seen as fair and just that an extension of time be granted. That means it must appear there can be a fair trial. "
34 Counsel also referred to the fact that in Brisbane South Dawson J had agreed, in a qualified way, with the reasons of McHugh J, Toohey and Gummow JJ had written joint reasons, upholding the appeal, McHugh J had written separately, upholding the appeal, his reasons in some respects varying from those of Toohey and Gummow JJ and the fifth judge, Kirby J, had been of the view that the Queensland Court of Appeal had been correct. Counsel then submitted that no part of McHugh J's reasons could be said to be the ratio in the case. He submitted that McHugh J's reasons, taken alone, were not binding on any first instance judge. If counsel was correct in this, it would follow that the same comment would apply to the reasons of the other judges. There was no single majority judgment.
35 Counsel for Miss Holt also pointed out that before the trial judge the GIO had not relied on prejudice because of the delay in itself in the commencement of proceedings. He referred the court to the transcript of argument before the trial judge in which the GIO's counsel is recorded as having said:
" There's some force in the proposition that we have notice of the claim from early days and we could have taken some steps during the running of the limitation period to have the plaintiff examined. I can't put any prejudice arising from the fact that we only had her examined after the period expired. "
36 What counsel at first instance is next recorded as saying relates to the point upon which he did rely before the trial judge and upon which the GIO again relied in the appeal:
" What I do say though is that the plaintiff bears the onus in this application and can't demonstrate that the initial records of the treating doctors are still around. "
37 This was a reference to the fact that although it appeared from Miss Holt's evidence that she had seen a number of doctors between 1992 and 1998, not all the reports from all the doctors had been put into evidence before Acting Judge Cantrill. Miss Holt had been asked in cross-examination if she knew whether the records of the various doctors were still in existence and had replied that she did not.
38 In regard to this her counsel submitted in the appeal that the fact that Miss Holt did not know whether or not the records existed did not supply any evidence at all to support the proposition either that they did exist or that they did not.
39 The argument for the GIO took up this last point. The argument was that there had been nothing communicated to the GIO prior to 1997 at any rate to indicate that Miss Holt's claim was anything other than a minor claim. Although the GIO had had Miss Holt examined by two orthopaedic specialists in 1997 there had been no medical reports served on the GIO on Miss Holt's behalf until 1998. The GIO had been hampered, it was submitted, in giving instructions for the 1997 examinations because it had not been able to instruct their nominated examining specialists properly.
40 When asked whether Miss Holt's evidence that she had no knowledge one way or the other of the continuing existence of the relevant records could furnish any evidence that they did not exist, counsel replied, in my opinion quite accurately, that the questions put to Miss Holt on that matter made it plain that there was an issue being raised by the GIO about the existence of the records. However, he made the further submission, with which I do not agree, that her answers furnished some evidence.
41 In my opinion, once the issue was raised by the GIO, the question became whether there was any evidence before the trial judge upon which he could be satisfied, as a matter of probability, that the records, or a significantly large proportion of them were still in existence. I will return to this question later.
42 On the questions which have been raised concerning in particular Salido and Brisbane South, the GIO's counsel submitted that
" there is no tension between the application of Brisbane South and Taylor and any of the judgments in Salido. It fits nicely into [Gleeson CJ's] guideline 4. "
43 The GIO's counsel did not make any submission about the difference asserted on behalf of Miss Holt between the reasons of Toohey and Gummow JJ on the one hand and McHugh J on the other.
44 Consideration of counsel's arguments.
One thing that became clear in the course of argument was that in deciding this case it is necessary to examine the relationship between Salido and Brisbane South in some detail. I will first turn to Salido and state my understanding of what that case decided.
45 Salido v Nominal Defendant (1993) 32 NSWLR 524. It could be argued that of the three cases mentioned by Powell JA when leave to appeal was granted, the only logically binding authority is Salido, the only one decided on the Motor Accidents Act itself. Salido dealt directly with s 52(4) of the Act. Brisbane South was decided upon provisions in the Queensland Limitation of Actions Act 1974. Zegarac was decided on a set of provisions inserted in 1990 in the New South Wales Limitation Act 1969 which did not appear in the Queensland Limitation of Actions Act 1974 dealt with in Brisbane South. The Limitation Act 1969 does not apply to claims under the Motor Accidents Act (s 52(5)), and the limitation and extension provisions in the Motor Accidents Act are not in the same terms as the Limitation Act provisions which were the subject of South Brisbane and Zegarac.
46 In Salido the court reversed the decision of a trial judge refusing leave to an applicant to commence proceedings more than three years after the date on which the claim had to be made in accordance with s 43. Each of the three judges gave separate reasons for the court's conclusion and stated the matters for consideration in exercise of discretion under s 52(4) in somewhat varying language. Gleeson CJ listed five guidelines which he said might be of assistance in obtaining consistency of decision making (at 532-533); Kirby P formulated "a non-exclusive check list of considerations" which he thought might be useful, and then listed ten such considerations (at 537-539) and Powell JA said that in substance there were but two questions for determination by the court (at 541).
47 Despite the differences of expression by the three judges, I think there can be derived from the lists of Gleeson CJ and Kirby P five propositions in common. In setting these out I will indicate after each proposition its number in the lists of the two judges, using their initials to identify them. The propositions are:
1. Section 52(4) confers a discretion which is to be exercised for the purposes of the Act; these purposes include forensic diligence; a corollary of the forensic diligence purpose is what Gleeson CJ called protection of defendants against the injustice of stale claims (G1, K2, K6).
2. The eventual question to be decided, in light of the purposes of the Act, is whether it is fair and just to grant leave (G2, K8).
3. The onus is on the applicant to show that it is fair and just to grant leave (G2, K4).
4. In considering whether the applicant has shown that it is fair and just to grant leave it is material for the court to take into account the delay and the applicant's explanation for it (G1, G3, K7 and K8).
5. In considering whether it is fair and just to grant leave, the disadvantage to the defendant which would result from the granting of leave is a material but not a conclusive consideration (G4, K5, 7 and 8).
48 The two matters which Powell JA thought were the material questions for determination are, in the order in which he stated them, contained in propositions 4 and 2 above.
49 Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541. This court's acceptance of the general proposition that Brisbane South is a governing authority in regard to applications for leave to commence proceedings under s 52(4) of the Motor Accidents Act requires elucidation. The submissions of Miss Holt's counsel merit careful consideration. This is because of the difference in the relevant provisions of the Queensland Limitation of Actions Act 1974 and the New South Wales Motor Accidents Act 1988, but also because of the difficulty in being able to state what was authoritatively decided (by which I mean decided by way of binding precedent) in Brisbane South on the question of the exercise of discretion in granting extensions of time under various statutes. To state this difficulty is not to criticise the decision of the High Court in Brisbane South. The reasons for that court's reversal of the decision of the Queensland Court of Appeal are quite plain and were agreed on by all four judges in the majority. All four thought the Queensland Court of Appeal was wrong on two points which for convenience I will call the construction point and the comparison point.
50 Before coming to these points, I note that the case concerned Ms Taylor, who wanted to bring an action against the Brisbane South Regional Health Authority (the Hospital) for negligence of one of its surgeons. Her application for an extension of time was refused at first instance, then was allowed by the Queensland Court of Appeal whose decision was in turn reversed by the High Court.
51 In their joint reasons Toohey and Gummow JJ set out the provision of the Queensland Act which gave rise to what I have called the construction point. This was s 31(2) which read:
" 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. "
52 It was conceded both in the Queensland Court of Appeal and in the High Court that Ms Taylor had established each of the requirements in pars (a) and (b) of s 31(2); however, in the High Court she in turn conceded that fulfilment of the two requirements did not necessarily result in her being entitled to an extension. Toohey and Gummow JJ thought this concession was correct, saying that
" The words 'may order' in subs (2) logically import an element of discretion on the part of the court. " (at 546)
53 They then noted (at 547) that Davies JA and Ambrose J had said:
" The scheme of the section, in our view, is that, upon compliance with paras (a) and (b), the applicant is entitled to an extension of time unless there is some matter justifying the exercise of a discretion against the granting of an extension. Once that is accepted, the evidentiary onus on this question is plainly on the respondent [that is, the present appellant] and, for the reasons we have given, was not discharged here. "
54 In the opinion of Toohey and Gummow JJ this construction was mistaken. They said the discretion conferred by the subsection was a discretion to grant an extension of the limitation period not a discretion to refuse so that an applicant had to satisfy the court that grounds existed for an exercise of discretion in favour of the applicant (at 547). They continued:
" There is an evidentiary onus on the prospective defendant to raise any consideration telling against the exercise of the discretion. But the ultimate onus of satisfying the court that time should be extended remains on the applicant. Where prejudice is alleged by reason of the effluxion of time, the position is as stated by Gowans J in Cowie v State Electricity Commission (Vict) [1964] VR 788 at 793 in a passage which was endorsed by Gibbs J in Campbell v United Pacific Transport Pty Ltd [1966] Qd R 465 at 474:
'It is for the respondent to place in evidence sufficient facts to lead the Court to the view that prejudice would be occasioned and it is then for the applicant to show that these facts do not amount to material prejudice. '" (at 547)
55 Toohey and Gummow JJ then referred to the way the trial judge had dealt with the matter. The trial judge had recognised that the Hospital was placed in a position of serious prejudice having regard to the lapse of time. This was apparently the basis on which he had refused the extension. Significantly for present purposes, because in this respect their reasons appear to differ from those of McHugh J yet to be discussed, they said that it had been open to the trial judge to take a different view on the facts but there could be no quarrel with the general approach he took (at 548).
56 Toohey and Gummow JJ then went on to consider further the reasons of Davies JA and Ambrose J. Here, they considered the comparison point. They said that not only did Davies JA and Ambrose J not approach the question of onus in accordance with established principles but they approached the question of prejudice by comparing the position the Hospital would have been in in an action instituted towards the end of the period of limitation and in an action instituted at the time of the application for extension. Toohey and Gummow JJ were of opinion that s 31(2) neither spoke of nor warranted such a comparison. They said:
" Once an applicant satisfies pars (a) and (b) the court has a discretion to extend the time for the bringing of an action. The material consideration (the most important consideration in many cases) is whether, by reason of the time that has elapsed, a fair trial is possible. Whether prejudice to the prospective defendant is likely to thwart a fair trial is to be answered by reference to the situation at the time of the application. It is no sufficient answer to a claim of prejudice to say that, in any event, the defendant might have suffered some prejudice if the applicant had not begun proceedings until just before the limitation period had expired. " (at 548-9, reference omitted)
57 The final step in the reasons of Toohey and Gummow JJ was to recognise that because the Queensland Court of Appeal had erred in its approach to s 31(2) the appeal had to be allowed and the High Court had to decide what orders should be made in place of those made by the Court of Appeal. The choice for the High Court would be between reinstating the trial judge's decision or, if he also had fallen into error for reasons other than those relied on by the Queensland Court of Appeal, the High Court itself exercising the discretion. Their conclusion was that because in their view the exercise of discretion by the trial judge had not miscarried in any material respect, and, again significantly, for the reason already mentioned, "even though it was open to him to reach a different conclusion" (at 550), the High Court should not substitute its own exercise of discretion for that of the trial judge and the trial judge's discretion should be reinstated.
58 In reaching this conclusion Toohey and Gummow JJ considered an argument that had been put on behalf of Ms Taylor that the trial judge's exercise of discretion had miscarried because he had failed to balance the prejudice to the Hospital against the prejudice to her. They were of the view that even after Ms Taylor had satisfied par (b) of subs 2 "a weighing process" (of prejudice against prejudice) was not called for. They said:
" The real question is whether the delay has made the chances of a fair trial unlikely. If it has not there is no reason why the discretion should not be exercised in favour of the respondent. " (at 550)
59 They again indicated that although there had to be some prejudice to the Hospital by reason of the delay, it would have been open to the trial judge to reach a different conclusion; but because he had not made any error of principle in regard to s 31(2) or in the way he considered how his discretion should be exercised, there was no basis upon which it should not be restored.
60 In McHugh J's reasons he dealt first with the construction point. His opinion on this was the same as that of Toohey and Gummow JJ. He said:
" With great respect to their Honours, s 31 should not be read as giving an applicant a presumptive right to an order once he or she satisfies the two conditions laid down in s 31(2) of the Act. An applicant for an extension of time who satisfies those conditions is entitled to ask the court to exercise its discretion in his or her favour. But the applicant still bears the onus of showing that the justice of the case requires the exercise of the discretion in his or her favour. " (at 551)
61 McHugh J then went on to explain his understanding of the "context of the rationales for the existence of limitation periods" in the light of which the discretion to extend time must be exercised. In the course of this discussion he dealt also with the comparison point, where again his opinion was the same as that of Toohey and Gummow JJ.
62 Also in the course of this discussion he made a number of observations relevant to the way discretion should be exercised in dealing with Limitation Act applications for extension. It is in these observations that there appears a distinct difference of emphasis from that shown in the reasons of Toohey and Gummow JJ.
63 McHugh J stated the general proposition that courts and commentators have perceived four broad rationales for enacting limitation periods (at 552). He said these were: (i), relevant evidence is likely to be lost (at 552), (ii), it is oppressive to allow an action to be brought against a defendant long after the circumstances which gave rise to it (at 552), (iii), people (the examples given were insurers, public institutions and businesses, particularly limited liability companies) should be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them (at 552) and (iv), the public interest requires that disputes be settled as quickly as possible (at 553).
64 McHugh J put particular emphasis on the deterioration in the quality of evidence with the passing of time. Sometimes, he said,
" ... the deterioration in quality is not recognisable even by the parties. Prejudice may exist without the parties or anybody else realising that it exists ." (at 551)