Latteria Holdings Pty Ltd v Corcoran Parker Pty Ltd

Solicitor for the Respondents: Moray & Agnew Lawyers Solicitor for the Prospective Respondent: Mr C Gillespie of Colin S Gillespie

IN THE FEDERAL COURT OF AUSTRALIA MELBOURNE DISTRICT REGISTRY GENERAL DIVISION VID 97 of 2014

JUDGE: MORTIMER J DATE OF ORDER: 22 august 2014 WHERE MADE: MELBOURNE

1. The application for joinder is refused.
2. The respondents pay the applicant's costs of and incidental to the application. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA MELBOURNE DISTRICT REGISTRY GENERAL DIVISION VID 97 of 2014

JUDGE: MORTIMER J DATE: 22 august 2014 PLACE: MELBOURNE

INTRODUCTION AND SUMMARY 1 By an application dated 28 May 2014, the respondents in this proceeding, Corcoran Parker Pty Ltd and Mr Darren Askew, applied pursuant to s 24AL of the Wrongs Act 1958 (Vic) and r 9.05 of the Federal Court Rules 2011 (Cth) for Mr Lucas James O'Brien to be joined as a respondent to this proceeding. 2 On 9 May 2014, in anticipation of that application being filed, orders were made requiring the respondents to serve a copy of any such application on Mr O'Brien, and directing the parties and Mr O'Brien to file and serve any written submissions they wished to make concerning the application by 6 June 2014, so that the matter could be determined on the papers. Both the applicant, Latteria Holdings Pty Ltd, and Mr O'Brien filed written submissions opposing the application. 3 For the reasons which follow, the respondents' application is refused.

THE SUBSTANTIVE PROCEEDING 4 The substantive proceeding in which this application is made concerns the provision of services as a livestock agent to Latteria by Corcoran Parker and its employee Mr Askew, including livestock trading services. The provision of services is alleged to have occurred in Victoria and New South Wales, in November and December 2011. The livestock in question were dairy cows purchased by Latteria. It is the applicant's contention that some of the dairy cows purchased carried disease, which not only infected those cows but spread to the rest of the applicant's herd, causing failure to thrive and death across the herd. The following description of the factual circumstances said to arise in the substantive proceeding is taken from the pleadings and set out here only as a summary of the way the case is put by the parties. 5 In late 2011, Latteria acquired a dairy farm in Tawonga, Victoria. Latteria claims that, around November 2011, Mr Tony Iaria, as representative of Latteria, met with Mr Trevor Parker (a principal of Corcoran Parker) and Mr Askew about the possible provision of livestock agency services by Corcoran Parker to Latteria. Following that meeting, Latteria retained Corcoran Parker to act as its livestock agent to purchase dairy cattle for the dairy farm. Latteria alleges that the respondents knew or ought to have known that Mr Iaria was inexperienced in the conduct of a dairy farm and in the specification and acquisition of dairy cattle. It alleges the respondents knew or ought to have known Mr Iaria would be relying on the respondents' expertise. 6 There is no dispute that, during November and December 2011, Mr Askew acted as Latteria's livestock agent on behalf of Corcoran Parker. Latteria alleges he provided advice on the specifications to be met to ensure that cattle purchased were of sufficient quality, and that he accompanied Mr Iaria on a trip to Sale, Victoria, where Mr Askew identified and recommended the purchase of approximately 191 head of cattle for the dairy farm at a cost of $1,750 per head plus GST. 7 Following delivery of the cattle from Sale, around 12 December 2011 Mr Iaria informed Mr Askew that Latteria was seeking to purchase another 20 head of cattle for the dairy farm. Again, it is not disputed that Mr Askew advised Latteria on or about 13 December 2011 that he had identified a further 20 head of cattle for the dairy farm in Gloucester and Taree, New South Wales, at a price of $1,400 plus GST per head of cattle, and Latteria instructed Mr Askew to purchase the Gloucester cattle on its behalf. 8 Latteria alleges that the cattle were delivered on 14 or 15 December 2011 and, the morning after delivery, Mr Iaria inspected the cattle and found some of the cattle to be infested with ticks. He arranged for those cattle to be treated accordingly. During the period mid-January to mid-February 2012, Latteria alleges that the herd began to sicken, weaken and die, and in March 2012 the disease theileria was diagnosed as being present in the herd. By October 2013, Latteria alleges, 52 head of cattle had died, and 92 cows had failed to thrive and had to be sold for an average price of $565 per head of cattle. 9 Latteria claims that Corcoran Parker and Mr Askew have breached the terms of their contract with Latteria in a variety of ways, including failing to warn or advise it of the presence of theileria in cattle in New South Wales generally and in the Gloucester cattle in particular, failing to inspect the cattle and take reasonable steps to ensure they were free from the disease, failing to arrange testing of the cattle for theileria prior to purchase and/or delivery, advising Latteria as to the quality of the cattle, advising Latteria to buy the cattle, and failing to arrange or to advise Latteria to arrange quarantine of the cattle on delivery from New South Wales. Latteria also claims Corcoran Parker and Mr Askew breached their duty of care to Latteria, and claims the respondents engaged in misleading and deceptive conduct pursuant to s 18 of Sch 2 to the Competition and Consumer Act 2010 (Cth) (the Australian Consumer Law) and s 9 of the Fair Trading Act 1999 (Vic). Latteria seeks declarations of the respondents' contraventions and damages for economic loss. 10 The respondents deny wholly the breaches alleged by Latteria. Further, in their defence, the respondents allege that Latteria had retained Mr O'Brien to perform advice and management services in relation to the operation of the dairy farm, and that he owed a duty of care to Latteria, which he breached. They allege that, if the matters pleaded in the applicant's statement of claim are established, the claim is apportionable pursuant to Part IVAA of the Wrongs Act and s 87CB of the Competition and Consumer Act 2010 (Cth), because Mr O'Brien is a "concurrent wrongdoer" within the meaning of those statutory provisions. The respondents allege the Court should apportion any liability for damages accordingly. 11 In its statement of claim, Latteria refers to Mr O'Brien as "a local farmer with some 20 years experience with dairy herds and who had been engaged as a sharefarmer by [Latteria] to assist with the operation of the Dairy Herd". 12 Corcoran Parker sought leave to file a cross-claim against Latteria in relation to what it alleges is the outstanding balance of costs and expenses incurred and payments made by Corcoran Parker in its ongoing provision of livestock services to Latteria. The cross-claim is for the amount of $176,999.34. Latteria consented to the filing of the cross-claim and leave was granted on 4 August 2014.

THE RELEVANT STATE AND FEDERAL PROPORTIONATE LIABILITY PROVISIONS 13 Part IVAA was introduced into the Wrongs Act in 2003 by the Wrongs and Limitation of Actions Acts (Insurance Reform) Act 2003 (Vic). Similar provisions were introduced in all other states and territories. In the following year, the Trade Practices Act 1974 (Cth) was also amended to introduce a scheme of proportionate liability. In effect, a national scheme of proportionate liability was introduced. The various provisions, and in particular the key definition of "concurrent wrongdoer" are in common form throughout, and are based on the draft model provisions, published in 1996 as part of a coordinated response to the recommendations of Professor JLR Davis, of the Australian National University, in his report following an inquiry into the law of joint and several liability: see Davis, JLR, Inquiry into the Law of Joint and Several Liability: Report of Stage Two (Attorney-General's Department, Canberra, 1995). When the Competition and Consumer Act and the Australian Consumer Law were enacted to replace the Trade Practices Act, the proportionate liability provisions were retained. 14 The national scheme was intended to remove perceived inequities and undesirable consequences flowing from the imposition on multiple defendants of liability on a joint and several basis. The development of the common law principles on joint and several liability, and their modification by statute, is traced by Bell and Gageler JJ in Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10 at [80]-[84]. 15 The federal and state schemes enact a legislative policy that, in respect of claims for economic loss or property damage at least, a defendant should be liable only to the extent of his, her or its responsibility: see Hunt & Hunt 247 CLR 613; [2013] HCA 10 at [16] per French CJ, Hayne and Kiefel JJ; St George Bank Pty Ltd v Quinerts Pty Ltd (2009) 25 VR 666; [2009] VSCA 245 at [57]-[59] per Nettle JA. 16 The argument that the provisions were intended to go further than that, and to focus only on a causation analysis, so as to reduce the damages available to a plaintiff or applicant, irrespective of whether those who caused some of the loss or damage were liable to the plaintiff or applicant, has been rejected: see, eg, Shrimp v Landmark Operations Ltd (2007) 163 FCR 510; [2007] FCA 1468 at [59] per Besanko J; Quinerts 25 VR 666; [2009] VSCA 245 at [59] per Nettle JA. The setting of this limit was endorsed by Bell and Gageler JJ in Hunt & Hunt 247 CLR 613; [2013] HCA 10 at [91], where their Honours said: To answer the description of "a person … whose acts or omissions (or act or omission) caused" that damage or loss or harm, C (in common with B) must be (or have been) legally liable to A for the damage or loss that is the subject of the claim. The reference in the definition to "acts or omissions (or act or omission)" is to one or more legally actionable acts or omissions. The reference in the definition to acts or omissions having "caused … the damage or loss that is the subject of the claim" is not, as has correctly been held, merely to causation in fact. "Questions of causation are not answered in a legal vacuum" but "are answered in the legal framework in which they arise". The reference here is to causation that results, or would result, in legal liability. 17 The rejection of this extended argument about the effect of the proportionate liability provisions, and the requirement that the person identified as a "concurrent wrongdoer" have a legal liability to the plaintiff or applicant, assumes some significance in the consideration of this interlocutory application. 18 Section 87CB of the Competition and Consumer Act provides: (1) This Part applies to a claim (an apportionable claim) if the claim is a claim for damages made under section 236 of the Australian Consumer Law for: (a) economic loss; or (b) damage to property; caused by conduct that was done in a contravention of section 18 of the Australian Consumer Law. (2) For the purposes of this Part, there is a single apportionable claim in proceedings in respect of the same loss or damage even if the claim for the loss or damage is based on more than one cause of action (whether or not of the same or a different kind). (3) In this Part, a concurrent wrongdoer, in relation to a claim, is a person who is one of 2 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. (4) For the purposes of this Part, apportionable claims are limited to those claims specified in subsection (1). (5) For the purposes of this Part, it does not matter that a concurrent wrongdoer is insolvent, is being wound up or has ceased to exist or died. 19 The definition of "concurrent wrongdoer" in s 24AH of the Wrongs Act is materially identical. Sections 24AE-24AF of the Wrongs Act set out the circumstances in which a claim may be an "apportionable claim" under Part IVAA of that Act. Like the federal scheme, the Wrongs Act applies to claims for economic loss or damage to property, although the statute adds the requirement that the loss or damage must arise "from a failure to take reasonable care". The operative obligation in each scheme is contained in s 87CD and s 24AI(1). They are in materially identical terms. Sections 87CD(1)-(3) provide: (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. (2) If the proceedings involve both an apportionable claim and a claim that is not an apportionable claim: (a) liability for the apportionable claim is to be determined in accordance with the provisions of this Part; and (b) liability for the other claim is to be determined in accordance with the legal rules, if any, that (apart from this Part) are relevant. (3) In apportioning responsibility between defendants in the proceedings: (a) the court is to exclude that proportion of the damage or loss in relation to which the plaintiff is contributorily negligent under any relevant law; and (b) the court may have regard to the comparative responsibility of any concurrent wrongdoer who is not a party to the proceedings. 20 Section 24AI(3) is a provision peculiar to the Victorian legislation. It prohibits the Court, in apportioning responsibility amongst the respondents, from taking into consideration the comparative responsibility of any person who is not a party to the proceeding: In apportioning responsibility between defendants in the proceeding the court must not have regard to the comparative responsibility of any person who is not a party to the proceeding unless the person is not a party to the proceeding because the person is dead or, if the person is a corporation, the corporation has been wound-up. 21 There is no such constraint in Part VIA of the Competition and Consumer Act: see s 87CG. Section 87CH does allow for a concurrent wrongdoer to be joined to a proceeding, in an exercise of the Court's discretion. Section 87CD(4) makes it clear however that need not occur, by providing: This section applies in proceedings involving an apportionable claim whether or not all concurrent wrongdoers are parties to the proceedings. 22 In these provisions, the term "damage" is a reference to the harm or loss suffered by the applicant or plaintiff, rather than the amount of damages, or the loss as quantified: see Hunt & Hunt 247 CLR 613; [2013] HCA 10 at [23]-[24] per French CJ, Hayne and Kiefel JJ, at [90] per Bell and Gageler JJ. This reflects the fact-based causation analysis exercise which must be carried out. 23 Minds may differ on the application of the causation analysis required by the proportionate liability provisions, as the departures in characterisation between the majority and minority in Hunt & Hunt demonstrate. The essential nature of the causation inquiry is one of fact (see Hunt & Hunt 247 CLR 613; [2013] HCA 10 at [47] per French CJ, Hayne and Kiefel JJ), and this emphasises the need for careful examination of the evidence in order to reach a conclusion about whether a person is or is not a "concurrent wrongdoer" for the purposes of the proportionate liability provisions.

THE RESPONDENTS' ARGUMENTS 24 The respondents submit that they seek to join Mr O'Brien in order to rely on the provisions in Part IVAA of the Wrongs Act relating to proportionate liability. Their submissions do not refer to or rely upon the equivalent provisions in Part VIA of the Competition and Consumer Act, despite the applicant's reliance on s 18 of the Australian Consumer Law in its claim, the respondents' reliance on s 87CB in their defence, and indeed that provision being the foundation of the Court's jurisdiction in this proceeding. The absence of reference to the federal scheme in the respondents' submissions is unexplained. 25 The respondents have pleaded that Mr O'Brien is a "concurrent wrongdoer" in relation to the claims made by Latteria. They allege in their defence that Mr O'Brien was retained by Latteria to provide "advice and management services in relation to the operation of the dairy farm". They allege that Mr O'Brien owed Latteria a duty of care, and that both that duty of care and the retainer were breached by Mr O'Brien after the Gloucester cattle arrived at the dairy farm by failing either to advise Latteria to take a number of steps or by failing himself to take those steps as part of his retainer. The steps relied on are the same steps pleaded against Latteria itself as either contributing to, or failing to mitigate, its loss and damage or as severing any causal link between the respondents' alleged conduct and Latteria's loss and damage. Those steps include failing to inspect the Gloucester cattle upon arrival, quarantine the cattle, treat the cattle for pests upon arrival or prior to integration with other cattle, regularly inspect the cattle for signs of injury or illness, provide appropriate care to sick cattle and avoid mustering or yarding any cattle that exhibited signs of illness. 26 The respondents' joinder application was supported by an affidavit sworn by one of the solicitors acting on behalf of the respondents. That affidavit does no more than summarise the allegations in the statement of claim and defence, state the deponent's belief that the applicant's claim was an "apportionable claim" and that Mr O'Brien is a "concurrent wrongdoer" for the purposes of the Wrongs Act, and paraphrase the terms of s 24AI of the Wrongs Act. 27 The applicant makes no allegations against Mr O'Brien, and has adduced no evidence on the respondent's application. Accordingly, there is no admissible evidence before the Court concerning Mr O'Brien's role in the events said to give rise to the causes of action pleaded by the applicant, nor the events said to give rise to his liability as pleaded by the respondents. 28 The questions involved in determining whether a person is or is not a concurrent wrongdoer being principally ones of fact, the approach taken in summary judgment applications (see, eg, Andrews v Australia and New Zealand Banking Group Ltd (2011) 281 ALR 113; [2011] FCA 388 at [23]) of assuming allegations of material facts in pleadings can be proven is inappropriate. 29 The respondents submit that they have established a "tenable" proportionate liability defence, as required by the decision of the Victorian Court of Appeal in Utility Services Corporation Ltd v SPI Electricity Pty Ltd (2012) 35 VR 628; [2012] VSCA 158 at [24]-[25] per Dixon AJA. Further, they claim that there will be real prejudice to the respondents if Mr O'Brien is not joined to the proceedings, as the respondents will have been denied the right for their liability to be limited under Part IVAA of the Wrongs Act.

THE APPLICANT'S AND MR O'BRIEN'S ARGUMENTS 30 The applicant opposes the respondents' application to have Mr O'Brien joined as a respondent. It has made no claim itself against Mr O'Brien in this proceeding. It submits no evidence is adduced by the respondents in support of the application that would enable the Court to determine whether the orders sought by the respondents to join Mr O'Brien should be made. The applicant submits that it is incumbent on the respondents to present sufficient evidence to the Court to enable it to determine whether or not they have a "reasonably arguable case" to support the joinder. 31 The Court directed the respondents to serve a copy of the application and their submissions on Mr O'Brien. As a matter of procedural fairness, where an individual is alleged by a respondent to be a concurrent wrongdoer, and for that reason said to be a necessary party to the proceeding, such a person is a clearly identified party with a substantial interest in the proceeding if those allegations are pressed, because the Court's determination may include a determination of the proportion of liability for the applicant's damage that should be ascribed to that third party. In circumstances such as those, on general princples it may be appropriate to give such a person an opportunity to be heard: see BP Australia Ltd v Brown (2003) 58 NSWLR 322; [2003] NSWCA 216 at [133]-[136] per Spigelman CJ, with whom Mason P and Handley JA agreed. In Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher (2014) 308 ALR 166; [2014] NSWCA 148, Brown was held to have been correctly decided, although Spigelman CJ's observations concerning procedural fairness were not in issue. 32 Mr O'Brien responded in writing to the application. He opposes the application to have him joined as a respondent. He submits that the respondents have failed to identify any causal link between any action of his and the applicant's alleged loss. He submits the respondents only make one real factual allegation against him in their defence. That is an allegation that Mr O'Brien inspected the diseased Gloucester Cattle "by description provided by Allan Edwards of M. Webb Bros Pty Ltd". Mr O'Brien submits it is not clear how he is said to have inspected the cattle "by description". Further, he submits, he did not know of the purchase of the Gloucester cattle until some time after they were delivered to the dairy farm. 33 In response to the allegations made by the respondents in their defence (and which I set out at [26] above) about activities they say Mr O'Brien failed to undertake following the arrival of the cattle, Mr O'Brien submits that the cattle did not exhibit any symptoms of the disease upon delivery, and that they generally do not exhibit such symptoms until under stress, and therefore there is no basis for joining him to the proceeding. 34 All those submissions involve contentions of fact which are not supported by any admissible evidence from Mr O'Brien or anyone else.

CONSIDERATION 35 The joinder application should be refused, for several reasons, which I explain in more detail below. First, s 24AI(3) of the Wrongs Act does not apply in the exercise of this Court's jurisdiction to require Mr O'Brien to be joined. That is because of the operation of ss 79 and 80 of the Judiciary Act 1903 (Cth). Second, in circumstances where there is no admissible evidence about Mr O'Brien's conduct and the applicant makes no allegations against him, I am not satisfied he is a "concurrent wrongdoer", which is the asserted basis of his joinder. Third, as a matter of discretion I am not persuaded his joinder is appropriate pursuant to r 9.05 because the only person whose interests might conceivably be prejudiced if he is not a party is Mr O'Brien himself, and he does not wish to be made a party. 36 In City of Swan v McGraw Hill (2014) 99 ACSR 280; [2014] FCA 442 at [48], in the context of the proportionate liability provisions in Subdiv GA of Div 2 of Part 2 of the Australian Securities and Investments Commission Act 2001 (Cth), Rares J stated (at [48], [51]-[52]): I am of opinion that a court needs evidence, based on an identifiable and intelligible issue, as to why an apportionable claim between concurrent wrongdoers can be made good, in order to determine, for the purposes of s 35(1)(a) or s 12GR(1)(a), the extent of a defendant's responsibility for the damage or loss suffered by a plaintiff. Importantly, s 12GR(1)(b) provides that the court can give judgment against a defendant whose liability it has found to be limited under s 12GR(1)(a) for not more than an amount fixed by reference to the proportionate share of damage or loss for which it found that defendant liable. A defendant must show on the evidence (whether or not that evidence had been tendered or led by that defendant) that he, she or it is a concurrent wrongdoer before the court can undertake any apportionment: cf: Hunt & Hunt 247 CLR at 626 [16]. That is why, where the plaintiff does not sue all potential concurrent wrongdoers, s 12GS(1) enables a defendant to raise the matter by giving notice of the information it has about the identity of, and the circumstances that may make the person, a concurrent wrongdoer. If a defendant wishes to establish that someone else has a concurrent liability for the damage or loss claimed by a plaintiff, ordinarily the defendant will have to persuade the court of the amount by which the defendant's responsibility for that damage or loss is less than 100% for the purposes of s 12GR(1)(a). … A plaintiff may sue more than one defendant so as to create an immediately apparent apportionable claim. Alternatively, the plaintiff may sue only one defendant who then pleads a defence raising an apparent apportionable claim. In each case, a defendant has an interest in defeating or minimising the proportion of liability that the court will find it just to attribute to it. A plaintiff may also seek to target one or more defendants as the person or persons to whom the court should apportion all or a larger share of liability. However, none of these scenarios, involving forensic tactical considerations, should be allowed to obscure the evident purpose of the proportionate liability legislation. That purpose is to create a defence that protects a defendant from having to bear more than a just share of liability as determined in proceedings brought against that defendant. The essential criterion that there be "proceedings involving an apportionable claim" exists throughout Subdiv GA. Moreover, a defendant whose liability has been found to be that of a concurrent wrongdoer gains the following statutory protections: first, regardless of the financial position of any co-defendant or other concurrent wrongdoer (s 12GP(5)), that defendant's proportionate responsibility to pay damages is both limited and fixed by a decision under s 12GR(1)(b), and, secondly, that defendant cannot subsequently be sued by any other person who is a concurrent wrongdoer for contribution or indemnity in respect of the apportionable claim by force of s 12GT. In contrast, the proportionate liability legislation does not, in terms, give a concurrent wrongdoer who is not a defendant in "proceedings involving an apportionable claim" any protection from being sued by a plaintiff or by a defendant found to be liable provided that in the subsequent proceedings, by force of s 12GU(2), the plaintiff cannot receive an amount more than the amount of damage or loss actually sustained. 37 While his Honour was speaking there of what was necessary for a defendant ultimately to take successful advantage of the proportionate liability provisions, and what the intended effect of those provisions is, his Honour's observations about the operation of the proportionate liability scheme emphasise the fact-intensive exercise involved. The present application seeks to have the Court join Mr O'Brien on the basis of the proportionate liability provisions without any evidence concerning his alleged liability being adduced. 38 Although this is a joinder application, neither party made any submissions about the applicable principles in relation to joinder pursuant to r 9.05 of the Federal Court Rules. 39 Mr O'Brien is not a person whose cooperation is necessary to enforce a judgment in favour of the applicant (r 9.05(b)(i)). Given the structure and content of the proportionate liability provisions under Part VIA of the Competition and Consumer Act, it cannot be said that Mr O'Brien's joinder is necessary so that each issue in dispute in the proceeding can be heard and finally determined (see r 9.05(b)(ii)). If Mr O'Brien is a necessary witness he can be subpoenaed. If the applicant is successful in its claim then, having relied on the state and federal proportionate liability provisions in their defence and provided the respondents adduce, and the Court accepts, the necessary evidence, the operation of the provisions will ensure that the respondents are not ordered to pay more by way of damages than a sum representing the Court's judgment of what is just for them to pay, having regard to the extent of their responsibility for the damage or loss. The proportionate liability provisions expressly contemplate that an applicant or plaintiff may bring subsequent proceedings against another concurrent wrongdoer. In his judgment in City of Swan 99 ACSR 280; [2014] FCA 442, Rares J set out some of the forensic reasons why an applicant or plaintiff may wish to "wait and see" before taking proceedings against a person a defendant or respondent asserts is a concurrent wrongdoer. 40 Similarly, the proposition that Mr O'Brien "ought" to have been joined as a party (see r 9.05(1)(a)) cannot be sustained when the applicant presses no claim against him, nor makes any allegations against him, and the proportionate liability provisions are given their proper operation. It has been said that, since an applicant is free to choose respondents to a proceeding, an applicant will not normally be compelled to add a respondent: see Atid Navigation Co Ltd v Fairplay Towage & Shipping Co Ltd [1955] 1 All ER 698; Acehill Investments Pty Ltd v Incitec Ltd (No 2) (2002) 85 SASR 452; [2002] SASC 406 at [25] per Debelle J. 41 In City of Swan 99 ACSR 280; [2014] FCA 442, Rares J identifies in the ASIC Act some costs consequences for respondents who do not notify an applicant of the existence of a concurrent wrongdoer, and similar consequences are imposed by s 87CE of the Competition and Consumer Act. Aside from those consequences, his Honour observes (at [64]-[65] and [73]-[74], and I respectfully agree with the analysis which precedes these conclusions) that: The evident intent of s 12GU is that the plaintiff can sue to recover the outstanding balance from anyone who is another concurrent wrongdoer. Considerable inconvenience, expense and injustice could be caused to a plaintiff if the proportionate liability legislation operated in the once for all way propounded by S & P That is because, as Swan and Moree argued was the case in the Wingecarribee proceedings, the bare identification of a concurrent wrongdoer and circumstances that "may make" it a concurrent wrongdoer may be insufficient, within the meaning of s 12GS(1)(b), to justify the plaintiff pursuing that person. The defendant may not have an interest in highlighting or developing why the potential concurrent wrongdoer is also liable, because to do so might make the defendant's forensic position worse. The construction of the proportionate liability legislation advanced by S & P also could lead to serious injustice if a defendant gave notice of a potential other concurrent wrongdoer pursuant to s 12GS(1) and pleaded, but did not prove, a defence based on that person's alleged responsibility. The proportionate liability legislation does not require the plaintiff to join such a person or undertake the risk, and expense, of suing him, her or it in the proceedings. The legislation does not extinguish or affect a plaintiff's cause of action against any third person merely because a defendant alleges or relies on a defence that the person was a concurrent wrongdoer based upon allegations that the defendant failed to establish in the proceedings. A plaintiff may consider that the case against the person notified by the defendant as a potential concurrent wrongdoer is weak. If the plaintiff fails to join that person and the defendant proves that the person is a concurrent wrongdoer so that the defendant's liability is apportioned below 100%, the defendant will have limited its own liability and to that extent established a partial defence. … For these reasons, I am of opinion that the proportionate liability legislation creates an effective defence for a defendant who can persuade a court that his, her or its responsibility for a claim should be limited, as French CJ, Hayne and Kiefel JJ said, by "apportioning that responsibility where the defendant can show that he or she is a 'concurrent wrongdoer'" (Hunt & Hunt 247 CLR at 626 [16]). A defendant who can show - ie prove - that, gets the benefit of a limitation, once for all, of his, her or its liability. And, if there is more than one concurrent wrongdoer joined as a party in the action, all of them will seek to have their respective liabilities to the plaintiff apportioned to as little as possible so as to thrust the balance onto each other defendant. The consequence of the court's determination, once made, will be that that apportioned share(s) cannot later be altered (subject to the principles affecting judgments obtained by fraud or other irregularities, none of which need be considered here) and, by force of ss 12GT and 12GV(2), those concurrent wrongdoer defendants cannot be called upon to make contribution or indemnity to a person who is later sued in a separate proceeding to which s 12GU applies. Thus, the effect of a defendant succeeding in having his, her or its responsibility for a claim apportioned is only to limit the liability to the plaintiff of that defendant. That result does not limit a plaintiff's available remedies against other concurrent wrongdoers who are not defendants in the proceedings to recover any damage or loss actually sustained that is not recovered from that defendant. 42 The submission of the respondents that without joinder of Mr O'Brien they will be denied their proportionate liability defence is plainly wrong at federal level, as the authorities to which I have referred demonstrate. The proportionate liability provisions of the Competition and Consumer Act will operate to the benefit of the respondents, provided they prove the facts necessary to come within those provisions, whether or not Mr O'Brien is joined as a respondent. The federal scheme in the Competition and Consumer Act is expressly premised on the assumption that a concurrent wrongdoer may not be a party to a proceeding. As the decision of Rares J demonstrates, these kinds of provisions also contemplate subsequent and separate proceedings by an injured party against a person identified as a concurrent wrongdoer. 43 For it to be relevant in this proceeding, Part IVAA of the Wrongs Act must be "picked up" and applied as a federal law by s 79(1) of the Judiciary Act: Solomons v District Court (NSW) (2002) 211 CLR 119; [2002] HCA 47 at [21] per Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ. Section 79(1) provides: The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable. 44 In Northern Territory v GPAO (1999) 196 CLR 553; [1999] HCA 8 at [80], Gleeson CJ and Gummow J said: The objective of s 79 is to facilitate the particular exercise of federal jurisdiction by the application of a coherent body of law, elements in which may comprise the laws of the State or Territory in which the jurisdiction is being exercised, together with the laws of the Commonwealth, but subject always to the overriding effect of the Constitution itself. 45 In the present proceeding, there are proportionate liability provisions in both the Competition and Consumer Act, and the Wrongs Act. As I have explained above, the only substantive difference between them is that s 24AI(3) of the Wrongs Act, uniquely, requires a concurrent wrongdoer to be joined as a party to a proceeding before liability can be apportioned by a court. The issue is whether this provision should be seen as "picked up" by reason of s 79 of the Judiciary Act so as to require the joinder of Mr O'Brien, notwithstanding the quite different operation of Part VIA of the Competition and Consumer Act. 46 The case of Austral Pacific Group Ltd (in liq) v AirServices Australia (2000) 203 CLR 136; [2000] HCA 39 concerned a suit by a Commonwealth employee in a state court against the manufacturer of equipment he alleged had caused him injury. He did not elect to sue under the federal Safety Rehabilitation and Compensation Act 1988 (Cth), although he was entitled to do so. The manufacturer sought contribution from the Commonwealth pursuant to state legislation providing for contribution between tortfeasors. The question was whether the state law operated, by reason of s 79 of the Judiciary Act, as a "surrogate federal law" to adjust the respective rights and liabilities as between the tortfeasors. 47 At [17] of Austral Pacific, Gleeson CJ, Gummow and Hayne JJ stated that, in determining whether a federal law "otherwise provides" for the purposes of s 79, a court is to ask whether the federal law would so reduce the ambit of the state law that the provisions of the federal law are irreconcilable with the provisions of the state law. The "covering the field" approach, drawn from decisions concerning s 109 of the Constitution, is not to be taken: GPAO 196 CLR 553; [1999] HCA 8 at [78]-[83] per Gleeson CJ and Gummow J, at [135] per Gaudron J, at [254] per Hayne J. In Austral Pacific, the plurality held that the federal law was silent on the legal question to which the state law applied, evincing a legislative intention to "leave such matters for the operation of State or Territorial legislation 'picked up' by s 79" and therefore the federal law did not "otherwise provide" for the purposes of s 79 of the Judiciary Act. To frame the question another way, as Gleeson CJ and Gummow J put it in GPAO 196 CLR 553; [1999] HCA 8 at [84], does the federal law "leave room" for the state law, or a provision of it, to operate? As the authorities demonstrate, what is "picked up" as surrogate federal law may be an entire legislative scheme, a portion of a scheme, or a particular provision within a scheme. 48 Section 24AI(3) requires that a Court "must not have regard to the comparative responsibility of any person who is not a party to the proceeding". By contrast, s 87CD(4) applies "whether or not all concurrent wrongdoers are parties". In my opinion, it is clear that, on its terms, the proportionate liability provisions in Part VIA of the Competition and Consumer Act are irreconcilable with the corresponding provisions in Part IVAA of the Wrongs Act. It is an express aspect of the federal scheme that the concurrent wrongdoer need not be a party to a proceeding in which a court makes apportionment orders. 49 Therefore, the Court is not required by s 24AI(3) to join Mr O'Brien. 50 That conclusion is not the end of the issue. Common law claims of breach of contract and breach of duty of care are made by Latteria against Corcoran Parker in this proceeding. Section 80 of the Judiciary Act provides the circumstances in which courts exercising federal jurisdiction are "governed" by the common law. It provides: So far as the laws of the Commonwealth are not applicable or so far as their provisions are insufficient to carry them into effect, or to provide adequate remedies or punishment, the common law in Australia as modified by the Constitution and by the statute law in force in the State or Territory in which the Court in which the jurisdiction is exercised is held shall, so far as it is applicable and not inconsistent with the Constitution and the laws of the Commonwealth, govern all Courts exercising federal jurisdiction in the exercise of their jurisdiction in civil and criminal matters. 51 Part IVAA of the Wrongs Act operates to "modify" the common law with respect to proportionate liability, for claims for economic loss or damage to property. In Blunden v Commonwealth (2003) 218 CLR 330; [2003] HCA 73 at [18], Gleeson CJ, Gummow, Hayne and Heydon JJ held that s 80 operates to apply the common law as modified by the statute law in force in the relevant state. Relevantly, s 80 requires that the common law as modified by Part IVAA of the Wrongs Act can only apply in this proceeding to the extent that it is "not inconsistent with the Constitution and the laws of the Commonwealth". For the reasons I have given above, s 24AI of the Wrongs Act is inconsistent with the provisions of Part VIA of the Competition and Consumer Act, and Part IVAA is not applied by either ss 79 or 80 of the Judiciary Act in this proceeding. Whether or not the term "inconsistent" might be seen to have a different meaning from "irreconcilable" as that term had been used in respect of s 79 (see Hill, G, and Beech, A, "'Picking Up' State and Territory Laws under s 79 of the Judiciary Act - Three Questions" (2005) 27 Aust Bar Rev 25), in the present circumstances the term "inconsistent" is equally applicable to the operation of s 24AI(3), compared to Part IVA of the Competition and Consumer Act. The former requires joinder of a current wrongdoer, the latter expressly contemplates that may, but need not, occur. Applying the former will produce an outcome the latter does not require and will remove or render nugatory the discretion given to the Court by s 87CH. That is an inconsistent operation. 52 Therefore the proposition that s 24AI(3) of the Wrongs Act makes Mr O'Brien a "necessary" party for the purposes of r 9.05 of the Federal Court Rules need not be further considered. 53 Even if I am wrong about the inapplicability of the Wrongs Act and s 24AI(3) applies in this proceeding, for the joinder application to succeed the respondents need to make good the submission that Mr O'Brien is indeed a "concurrent wrongdoer". The question raised by the submissions of the applicant and of Mr O'Brien is to what standard the respondents must satisfy the Court at the stage of joinder. 54 Although the respondents submit that the Court, on this application, need only be satisfied that the application of the proportionate liability provisions to Mr O'Brien is "tenable", the authority relied on for that proposition is the decision of the Victorian Court of Appeal in Utility Services 35 VR 628; [2012] VSCA 158 at [24], relevantly given in the context of the presence of s 24AI(3) in the Wrongs Act, and in the context of an application to amend a defence to counterclaim to include a claim under Part VIA of the Wrongs Act. The reference to "tenable" by Dixon AJA in Utility Services 35 VR 628; [2012] VSCA 158 at [24] is accompanied by a footnote reference to s 63 of the Civil Procedure Act 2010 (Vic). Section 63 is a provision dealing with the power of the Court to give summary judgment where a claim, defence or counterclaim has "no real prospect of success". Dixon AJA's reference to s 63 and to the concept of "tenable" thus appears to pick up the standard of satisfaction necessary for an amendment to a pleading to be allowed, as well as picking up the terms used by the trial judge in that case, who described the proportionate liability claim as "untenable" and used this as the basis for rejecting the proposed amendment. 55 For reasons related to the interpretation of the Wrongs Act provisions which need not be elaborated here, the Court of Appeal disagreed with the trial judge's construction of those provisions as they related to liability in circumstances where one actor had been substituted in law for another actor. 56 I do not read Dixon AJA's use of the term "tenable" in the context of Utility Services 35 VR 628; [2012] VSCA 158 as setting out the standard for a decision as to joinder of a party, under the rules of the Supreme Court, and certainly not under r 9.05 as to joinder. 57 In circumstances where the applicant makes no allegations against Mr O'Brien, the respondents should in my opinion provide some evidentiary basis for the contention at the core of the application that the person sought to be joined is a "concurrent wrongdoer". As Bell and Gageler JJ pointed out in Hunt v Hunt, the terms of the proportionate liability provisions go beyond posing simply a causation question. They require causation that would result in legal liability to an applicant by the alleged concurrent wrongdoer. 58 Where the applicant makes no allegations against that person and opposes the joinder, there is no concession by the party to whom the wrongdoer is said to be liable that the third party is seen by that party as a concurrent wrongdoer. Although some joinder applications may be dealt with on the pleadings, in my opinion, even if s 24AI(3) applies in this Court in this proceeding, the respondents must provide some evidentiary basis for their assertions and they have not done so. This is especially so when the causation aspect of the proportionate liability provisions are so factually based. However there should also be at least some probative evidence (direct or indirect) of the legal relationships alleged to exist which gives rise to Mr O'Brien's liability to the applicant, as well as the causal link between his conduct and the applicant's loss and damage. In a given case, admissions made on the pleadings may or may not assist. The Court is, however, not entitled to speculate as to the factual basis for the application of these provisions: see Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262; [2000] NSWSC 29 at [80] per Spigelman CJ. 59 If s 24AI(3) does not apply, and the application is considered as a matter of discretion under r 9.05, again in the exercise of my discretion I consider that there is an insufficient basis made out by the respondents for the joinder. 60 There is merit in Mr O'Brien's submissions that he should not be put to the considerable cost, in terms of time, money and resources, of being a party to a proceeding such as this where the applicant makes no claim against him. I consider that submission is strengthened by the clear operation of Part VIA of the Competition and Consumer Act in preserving the entitlement of the respondents to orders which reflect only their proportion of liability for any damage the applicant proves it has suffered, provided the respondents succeed at trial in establishing the necessary factual matters to rely on those provisions. 61 The interlocutory application should be refused. The respondents should pay the applicant's costs in responding to the application. Although the Court has a discretion to award costs in favour of a non-party, I do not consider that Mr O'Brien's circumstances are sufficiently exceptional, nor that the costs incurred by him in making short submissions on a discrete issue are of such a magnitude, that the confined circumstances in which it is appropriate for the Court to order costs in favour of a non-party arise: see generally Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 203 per Dawson J; O'Keefe v Hayes Knight GTO Pty Ltd [2005] FCA 1559 at [24] per Nicholson J; Re Pan Pharmaceuticals Ltd; Selim v McGrath (2004) 48 ACSR 681; [2004] NSWSC 129 at [20] per Barrett J. 62 Two concluding observations should be made. 63 First, the refusal of this joinder application does not not preclude the respondents, at a later stage and on appropriate evidence, making a submission that there are changed circumstances which have emerged in the conduct of the matter that mean the joinder of Mr O'Brien (in the exercise of the Court's discretion) should be revisited. 64 Second, in refusing this application, the only finding I have made about the applicability of Part VIAA of the Wrongs Act to this proceeding is that s 24AI(3) of the Wrongs Act is not "picked up" by s 79 of the Judiciary Act, nor made applicable by s 80 of the Judiciary Act, so as to require the Court to join Mr O'Brien. The manner in which the whole of the proportionate liability provisions in Part VIAA of the Wrongs Act apply, to the contractual and tortious claims of Latteria and to the liability of the respondents, is factually and legally complicated. Whether for example they involve the Court taking a different approach to the determination of liability than that required by Part VIA of the Competition and Consumer Act, so that the whole of Part VIAA of the Wrongs Act should not be considered to be "picked up", will be a question for trial: cf Dartberg Pty Ltd v Wealthcare Financial Planning Pty Ltd (2007) 164 FCR 450; [2007] FCA 1216 at [16]-[37] per Middleton J. It is not a matter which needs be decided on this application but it will have to be addressed in detail by the parties at trial. I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Mortimer.