Laws v GWS Machinery Pty Ltd & Anor; Laws v GWS Machinery Pty Ltd & Anor

HEARING DATE(S) : 29 April 2008 (plus written submissions concluding 7 May 2008), 8 May 2008

A. On the Notice of Motion filed by CGU Insurance Australia Limited of 22 April 2008: (i) Motion be dismissed; DECISION : (ii) The applicant on the Motion pay the Respondents' costs of and incidental to the Motion, as agreed or assessed.

B. In 20084/02, Thomas John Laws (Laws Senior): (i) Vary the judgment of the Court dated 2 November 2007 by deleting from order (iv) thereof the dates "4 June 2006" and "5 June 2006" and insert in lieu thereof the dates "12 May 2006" and "13 May 2006" respectively; (ii) Each party shall bear his or its costs of or incidental to this motion.

CATCHWORDS : PRACTICE - leave to reopen to amend orders to limit liability otherwise ordered - requirement to amend pleadings and adduce evidence - operation of 'slip rule' - leave refused - PRACTICE - amendment of costs order - typographical error by party - consent order - fresh assessment of appropriateness of order - order varied.

Corporations Act 2001 LEGISLATION CITED : Law Reform (Miscellaneous Provisions) Act 1946 Trade Practices Act 1974 (Cth) Uniform Civil Procedure Act 2005

Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; (1988) 164 CLR 502 Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394 Dunstan v Rickwood (No. 2) [2007] NSWCA 266 Ghunaim v Bart (No. 2) [2006] NSWCA 82 CASES CITED : Hall Chadwick v Doyle [2006] NSWSC 1195 L. Shaddock and Associates Pty. Ltd. v. Parramatta City Council (No. 2) [1982] HCA 59; (1982) 151 CLR 590 Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor [2007] NSWSC 316 Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor (No 2) [2007] NSWSC 1249 Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528 Logwon Pty Ltd v Warringah Shire Council (1993) 33 NSWLR 13

20076/2002 - John Rodney LAWS (Plaintiff) GWS Machinery Pty Ltd (First Defendant) Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited (Second Defendant) PARTIES : 20084/2002 - Thomas John LAWS (Plaintiff) GWS Machinery Pty Ltd (First Defendant) Motokov Australia Pty Limited (in liquidation) / CGU Insurance Australia Limited (Second Defendant)

20076/2002 - No appearance (Plaintiff) S G Campbell SC / P L Perry / T A Berberian (First Defendant) P Greenwood SC / S Gray (Second Defendant) COUNSEL : 20084/2002 - P J Doherty SC / D Morgan (Plaintiff) S G Campbell SC / P L Perry / T A Berberian (First Defendant) P Greenwood SC / S Gray (Second Defendant)

20076/2002 - Lamrocks Solicitors (Plaintiff) Moray & Agnew Solicitors (First Defendant) Curwoods Lawyers (Second Defendant) SOLICITORS : 20084/2002 - Somerville & Co (Plaintiff) Moray & Agnew Solicitors (First Defendant) Curwoods Lawyers (Second Defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20076/2002 John Rodney LAWS by his tutor Catherine Anne LAWS v GWS MACHINERY PTY LIMITED & Anor

20084/2002 Thomas John LAWS v GWS MACHINERY PTY LIMITED & Anor

JUDGMENT 1 HIS HONOUR: This judgment deals with two issues raised respectively by CGU Insurance Australia Limited ("CGU") and by Thomas John Laws ("Laws Senior"), consequential on the orders made in these proceedings. 2 The CGU motion seeks orders the effect of which is to vary the orders made on 2 November 2007 and 13 November 2007 such that the liability of CGU, which was substituted for Motokov Australia Limited ("Motokov") (see judgment Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor [2007] NSWSC 316 ("the first judgment") at [3]) to both Laws Senior and John Rodney Laws ("Laws Junior") is no greater (including costs) than $5 M, which is said to be the limit of the liability under the relevant insurance policy between Motokov and CGU. 3 The Notice of Motion filed by Laws Senior seeks an alteration of the orders made on 2 November 2007 in Laws v GWS Machinery Pty Ltd & 2 Ors; Laws v GWS Machinery Pty Ltd & Anor (No 2) [2007] NSWSC 1249 ("the second judgment") by altering the date, upon which indemnity costs are payable, from the date specified in the order, namely, 5 June 2006, to the date of an offer, being, 5 May 2006. Short History of the Proceedings 4 The proceedings arose out of an injury to each of Laws Senior and Laws Junior when Laws Senior was fitting a tyre to the tyre rim of a tractor. The tyre was manufactured, for relevant purposes, by Motokov and sold by GWS Machinery Pty Limited ("GWS"). Laws Senior was not a trained or qualified tyre fitter and no warning as to the dangers of fitting a tyre was given. 5 The injuries to Laws Junior were substantial. The injuries to Laws Senior were less problematic and did not significantly alter his life circumstances. 6 There were a number of interrelated cross-claims and the matters came before the Court over 21 hearing days together with written submissions. 7 On 4 June 2007, I delivered the reasons for judgment in the first judgment and proposed orders the effect of which included a verdict for the plaintiff in each of the matters. In relation to Laws Senior I calculated an amount of $272,433.79 and indicated that GWS and CGU contribute 50 percent of the judgment sum. I also ordered costs. 8 In relation to Laws Junior, I proposed a judgment for him of $9,146,462.05. I again indicated that GWS and CGU would contribute 50 percent of the judgment sum and that they would pay the costs of the plaintiff. Each of the proposed orders, it was indicated, would come into effect on 1 June 2007. 9 The orders actually made (as distinct from proposed) on 4 June 2007 were that each of the matters stand over, there be leave given to each of the plaintiffs to elect as to damages in negligence or under the Trade Practices Act 1974 (Cth), allow the parties to deal with any alleged miscalculation in the assessment of damage and any other consequential matter. 10 Essentially the substantive proceedings dealt predominantly with the principles and determination of liability and the principles (or basis) of the assessment of damage, but less attention (understandably) was paid to the assessment of damage and the calculation thereof. In accordance with the leave granted and the directions made, the matter came before the Court on 13 July 2007 and further directions were given as to the filing of written submissions. The issues raised, relevantly, in the proceedings leading to the second judgment were the proportionate liability as between GWS and CGU, and in particular whether CGU owed GWS an indemnity under the Trade Practices Act; and whether Laws Junior was entitled to an amount to compensate for funds management. It also included the issue of whether the liability of CGU and GWS would be for the entirety of the verdicts. There was also an issue as to a slip made in the calculation relating to vicissitudes that were omitted from the calculation in relation to Laws Senior. 11 As a consequence of those proceedings orders were made the effect of which was that each of GWS and CGU were liable for the verdicts to both Laws Senior and Laws Junior in the amount of $272,433.79 and $9,282,810.20 with an indication that each of the defendants would have a liability that would be borne equally between them. In the case of Laws Senior, costs were ordered to be paid on a party-party basis up to and including 4 June 2006 and thereafter on an indemnity basis. On the issue of indemnity costs and the date from which they related, the order made was a consent order and the Court was informed that it related to an offer to settle the proceedings that was not accepted by the defendants. Leave was given to Laws Junior to seek an increase in the verdict to compensate the costs of funds management, once ascertained. Alteration of Liability of CGU 12 I was informed during the course of these, the fourth set of proceedings, that the orders made arising from the second judgment have been appealed to the Court of Appeal and are to be heard by the Court of Appeal commencing on 12 May 2008. It was necessary, it was submitted, for the Court to resolve this issue before the matter came before the Court of Appeal. The matter was listed for an hour before Court on 29 April 2008 (the Notice of Motion having been filed on 22 April 2008). Thereafter the matter proceeded by written submissions. 13 The orders sought be CGU in its Notice of Motion are: " in proceedings no 20076/02 , that:

1. pursuant to rule 36.15 or alternatively rule 36.17 of the Uniform Civil Procedure Rules 2005, Order 2 of the Judgment of Rothman J dated 8 February 2008 be corrected to state that the judgment against the Second Defendant, in combination with the judgment in proceedings no. 20084/02, is limited to the Second Defendant's liability under section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 and/or section 601 of the Corporations Act 2001, being a total liability of $5million.

2. Further and in the alternative, pursuant to section 135 of the Civil Procedure Act 2005, the enforcement of the judgment as against the Second Defendant in the proceedings is limited, in combination with the judgment in proceedings no. 20084/02, to its liability under section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 and/or section 601 of the Corporations Act 2001, being a total liability of $5million.

3. pursuant to rule 36.15 or alternatively rule 36.17 of the Uniform Civil Procedure Rules 2005, Order 1 of the judgment of Rothman J dated 2 November 2007 be corrected to state that the judgment against the Second Defendant, in combination with the judgment in proceedings no. 20076/02, is limited to the Second Defendant's liability under section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 and/or section 601 of the Corporations Act 2001, being a total liability of $5million.

4. Further and in the alternative, pursuant to section 135 of the Civil Procedure Act 2005, the enforcement of the judgment as against the Second Defendant in the proceedings is limited, in combination with the judgment in proceedings no. 20076/02, to its liability under section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 and/or section 601 of the Corporations Act 2001, being a total liability of $5million." 14 CGU read and rely upon two Affidavits, one of Michael Francis Peter Todd, sworn 8 April 2008 and one of Scott David Kennedy, sworn 17 April 2008. 15 Mr Todd is a "team leader for CGU" and swears that CGU issued a policy of insurance to Motokov for the period 1 November 1998 to 1 November 1999 (the relevant period), which was current as at the date of the accident on 10 March 1999. He says he has reviewed the underwriting files including the policy wording to confirm "that the limit of CGU Insurance Australia's cover to Motokov Australia Pty Limited under the policy is $5,000,000 (five million dollars)". Mr Todd then attaches and marks "A" "a copy of policy printed out on 7 April 2008 showing the policy wording and schedule". 16 There are two significant matters in and relating to this Affidavit. First, it is the only Affidavit from an officer or employee of CGU. It does not assert that the policy of insurance to which reference is made is the only policy of insurance issued for the relevant period. It confines the limit of liability (in the understanding of the deponent) to the limit of liability under that policy. It prints out as at 7 April 2008 the policy wording and schedule without any assertion that the policy wording as at 7 April 2008 is the same as it was as at 10 March 1999. 17 It may be that the use of the definite article in the term "the policy", when referring to the wording in the annexure, was intended to be evidence that the printout on 7 April 2008 was a printout of the policy that existed on 10 March 1999. If so, the reference to 7 April 2008 is, at best, confusing and irrelevant. The absence of an express statement to the effect that the copy produced is a copy of the policy that existed on 10 March 1999 is, in my view, significant. Moreover the absence, were this the only evidence, of an express statement that no other policy of insurance was issued to Motokov is most significant. 18 Mr Kennedy, the other deponent, is a solicitor. He is the solicitor on the record for CGU in the proceedings. Mr Kennedy asserts, which is no doubt within his own knowledge and is otherwise not contested, that there is a dispute as to the operation of the judgment in these proceedings and, in particular, whether CGU has a liability greater than $5 M which, it is asserted, is the limit of liability under the contract of insurance as previously described. 19 Mr Kennedy asserts that a copy of the contract of insurance issued to Motokov by CGU is attached. Attached is an insurance policy written in "plain English". The terms of the policy are not wholly unambiguous in terms of the effect on these proceedings and liability occasioned by the judgment or judgments in these matters. The schedule purports to cover Motokov for public liability and products liability each for a limit of indemnity of $5 M. "Public liability" is defined as Motokov's "legal liability to pay damages for an Occurrence (and for consequential loss caused by the Occurrence) in the course of [Motokov's] Business, but excludes Products Liability." 20 "Products liability", under the wording provided by the solicitor for CGU, is defined as: [Motokov's] legal liability to pay damages for an Occurrence (and for consequential loss caused by the Occurrence), caused by an Unknown Defect in [Motokov's] Products, but excludes Public Liability." 21 The circularity of these definitions is manifest. 22 An "Occurrence" is defined to mean: "Personal Injury or Damage to Property that:

1. is neither intended nor expected by a reasonable person in [Motokov's] position; 2. is caused by an Event; and 3. occurs: (a) within the Geographical Limits; and (b) during the Period of Insurance." 23 Nothing turns on the provisions of paragraph (3) of the above definition. 24 In turn, "Event" is defined to mean: "1. a single incident; 2. a series or number of incidents either having the same original cause or attributable to the one source; or 3. continuous or repeated exposure to the substantially the same general conditions." 25 The maximum amount that CGU will pay pursuant to the limitations in the policy (assuming it is the policy in effect at 10 March 1999) for public liability for one Occurrence "shall be the Limit of Indemnity shown in the Schedule" (being $5 M [or $10 M, if liability arises under both products and public liability] on the above assumptions). The maximum amount for products liability that CGU will pay for products liability "for one Occurrence, shall by the Limit of Indemnity shown in the Schedule, less the sum of the indemnities that [CGU] have already paid for Products Liability that arose during the Period of Insurance." 26 There is no evidence as to what is the amount, if any, paid to or on behalf of Motokov for products liability arising during the period of insurance that included 10 March 1999, other than the liability arising from the orders in these matters. 27 That part of the policy provided, headed by the words "Additional Benefits", provides that legal costs in the case of public liability or products liability of, relevantly, Motokov would be paid by CGU and legal costs are defined to mean Motokov's costs and expenses and legal costs and expenses of any claimant against Motokov that Motokov is liable to pay. 28 The document which is behind tab 1 of the Affidavit of Mr Kennedy and is said to be the Policy and the schedule to which I have referred is a document which is undated except for the date of a facsimile by which the Policy was transmitted. The date on the facsimile, which is a facsimile that, on its face, discloses that CGU Liability Claims faxed the document to Curwoods Lawyers, the solicitors on the record for CGU, is 12 April 2006. There is no evidence as to why it has taken over 18 months for this matter to be raised. (The facsimile marking bears the notation 12 April 2006 at 5.38pm from CGU Liability Claims to a fax number which is the fax number disclosed in the coversheet of the Affidavit of Mr Kennedy as the fax number of Curwoods Lawyers.) 29 The Notice of Motion is, in its terms, deficient. As was pointed out during the course of the proceedings on 29 April 2008, leave is necessary to re-open the proceedings and treat the material adduced in the two Affidavits as evidence in the proceedings. Further, it would be necessary to amend the pleadings. If leave to re-open the proceedings and adduce further evidence be granted by the Court, the evidence filed on the Notice of Motion (and otherwise not the subject of cross-examination) shall be treated as evidence in the proceedings. 30 CGU move under the provisions of Part 36 Rule 15 of the Uniform Civil Procedure Rules, which Rule is in the following terms: "(1) A judgment or order of the court in any proceedings may, on sufficient cause being shown, be set aside by order of the court if the judgment was given or entered, or the order was made, irregularly, illegally or against good faith. (2) A judgment or order of the court in any proceedings may be set aside by order of the court if the parties to the proceedings consent." 31 Further CGU rely upon UCPR Part 36 Rule 17 which provides: "If there is a clerical mistake, or an error mistake arising from an accidental slip or omission, in a judgment or order, or in a certificate of the Court, on the application of any party or of its own motion, may, at any time correct the mistake or error." 32 The principles associated with the correction of a judgment once entered were adumbrated by me, in a different context, in the judgment in Hall Chadwick v Doyle [2006] NSWSC 1195. The context in which the matter was discussed in Hall Chadwick was in relation to a submission that no appeal was permissible against the judgment of a costs assessor, or costs review panel, once it had, pursuant to the provisions of the statutory regime, been entered and treated as a judgment of the Court. In Hall Chadwick, I said: "[35] In Bailey v Marinoff , Barwick CJ said:

'Once an order disposing of a proceeding has been perfected by being drawn up as a record of the Court, that proceeding apart from any specific and relevant statutory provision is at an end in that Court and is in substance, in my opinion, beyond recall by that Court. It would, in my opinion, not promote the due administration of the law or the promotion of justice for a Court to have a power to reinstate a proceeding of which it has finally disposed.' (per Barwick CJ at 530).

[36] Chief Justice Barwick was agreeing with the other members of the Court, with the exception of Gibbs J, as he then was. One of the members of the High Court in Bailey v Marinoff , Menzies J, said:

'This appeal is not concerned with the power of a Court to alter orders in pending litigation. It is concerned with the power of a Court to make an order in litigation which, without any error or lack of jurisdiction, has been regularly concluded and is no longer before the Court, To recognise the problem is, I think, to solve it. However wide the inherent jurisdiction of a Court may be to vary orders which have been made, it cannot, in my opinion, extend to the making the orders in litigation that has been brought regularly to an end.' (per Menzies J 125 CLR at 531-532).

[37] Bailey v Marinoff was a case in which the Court of Appeal had made self- executing orders the effect of which was that proceedings were dismissed because appeal books, although served, had not been filed. The judgment which contained the self-executing orders had been entered by the Court and, in every respect, perfected. The Court of Appeal then purported to reinstate the matter into the list for reasons which are now irrelevant. This seems a very different factual situation than the one with which the Court is now dealing.

[38] In Bailey v Marinoff , Barwick CJ speaks of the absence of any 'inherent power or jurisdiction' and Menzies J speaks of 'the inherent jurisdiction', in reference to the Court of Appeal of the Supreme Court of New South Wales.

[48] The issue is discussed also by the High Court in DJL v Central Authority (2000) 201 CLR 226. The majority judgment (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ) discusses the issues of the relief sought to be obtained and the capacity of a court, in the proceedings then before the High Court it was the Family Court of Australia, without inherent jurisdiction to reopen its own judgment. In so doing it cited with approval the judgment of the Chancery Division in C.H. Giles and Co v Morris [1972] 1 All ER 960. There, Megarry J said:

'A convenient starting point is the head note to Ainsworth v Wilding [1896] 1 Ch 673. This reads as follows:

"After a judgment has been passed and entered - even where it has been taken by consent and under a mistake - the Court cannot set it aside otherwise than in a fresh action brought for the purpose unless (i) there has been a clerical mistake or an error arising from an accidental slip or omission within the meaning of the Rules; or (ii) the judgment as drawn up does not correctly state what the Court actually decided and intended to decide - and either of which cases the application may be made by motion in the action. Semble, that different considerations apply to interlocutory orders; but even if a judgment has not been passed and entered the Court will not always interfere on motion, eg. where from the nature of the ground relied on conflicting evidence is essential."

This decision has been repeatedly applied and approved; and on the face of it the decision appears to require that a fresh action should be brought in a case like this. However, motions to discharge or vary an order have long been known, and so the question is what part is left for them to play.

Counsel for the defendants contended that the distinction was not between interlocutory and final orders (although Ainsworth v Wilding recognises that there may be a distinction of this kind), nor between orders made by the master and orders made by a judge, but between orders made in chambers, whether by a master or a judge, and orders made in Court. He submitted that, though perfected, an order made in chambers is open to review on motion, whereas an order made in court, at all events if a final order, can be discharged or varied only by means of a new action…That may indeed have been the distinction; the question is not easy and requires further consideration.' (at 964-965)

[49] The High Court in DJL v Central Authority summarised the situation in the following way:

'The common law courts, as superior courts of record, had "full power to rehear or review a case until judgment [was] drawn up, passed, and entered". That statement, with citation of supporting authority, was made by Starke J in Texas Co (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 at 457. Even after entry of judgment, an error arising from an accidental slip or omission might be corrected at any time by further order in the action and even without an enabling rule of court (Shaddock v Parramatta City Council [No2] (1982) 151 CLR 590 at 594-595). An order might also be made in the action for the correction of the records of the court to make certain that they truly represented what the court had pronounced or had intended to pronounce ( Ainsworth v Wilding [1896] 1 Ch 673 at 678-679; Ivanhoe Gold Corporation Ltd v Symonds (1906) 4 CLR (Part 1) 642 at 669). It also appears that a judgment might be set aside after entry if the parties to the judgment consented, although in deciding whether to make such an order the Court would have regard to the interests of third parties ( Permanent Trustee Co (Canberra) Ltd v Stocks & Holdings (Canberra) Pty Ltd (1976) 26 FLR 195). Finally, where the business of the Court was so organised that some orders were made in chambers, those orders may have been open to review by motion in the action, even if they were final orders ( Giles (CH) and Co Ltd v Morris [1972] 1 WLR 307 at 313; [1972] 1 All ER 960 at 965).

The Court of Chancery had power to reopen and rehear cases which had been tried before it, even after the decree had been entered. The right of rehearing in the Court of Chancery had involved the exercise of appellate rather than original jurisdiction…However, that peculiar state of affairs in Chancery did not continue with respect to the exercise of equitable jurisdiction by the Supreme Court of Judicature established by the Judicature Act 1873 (UK). The structure it provided included the Court of Appeal.' ( DJL v Central Authority , supra , at 244, [34] - [35]).

[51] From the foregoing we can derive the following principles:

(a) The Supreme Court of New South Wales is a superior court of record with inherent jurisdiction and all of the jurisdiction and the powers necessary for the administration of justice in New South Wales;

(b) The New South Wales Supreme Court has all of the powers of the Courts of Westminster, untrammelled by any restriction in power that may have been a consequence of the Judicature Act 1873 (UK);

(c) The limitations on the Supreme Court of New South Wales in recalling and reopening a judgment once passed and entered are limitations imposed by the common law and have exceptions which include:

(b) The power to amend [an order] where the intention of the Court has not manifested in the judgment;

(c) The capacity to allow the opening of orders made in chambers." 33 Further to the above, and irrelevant for the purposes of the judgment cited, there is a further capacity to set aside, which capacity is peculiar to particular kinds of orders e.g. default judgment and consent orders. As to the orders that are now sought to be varied, it could not be said that they were made by default or consent. Nor can it be said that the orders made were a result of "mere inadvertence" of the legal representative of CGU: see L. Shaddock and Associates Pty. Ltd. v. Parramatta City Council (No. 2) [1982] HCA 59; (1982) 151 CLR 590 at 594. There is no evidence to suggest that the failure to adduce evidence that the limit of the liability of CGU was $5 M was inadvertent. None of the defences filed as amended or further amended, to any of the Statements of Claim or the Cross-Claim from GWS, make any reference to a limit of liability that is relevant to the current proceedings. There is no attempt to amend the pleadings. 34 For the purposes of the exercise of discretion on this motion, I accept, without deciding, that the Court has power to amend in accordance with the Notice. This Motion seeks an order that must be based upon evidence that was not adduced at the trial. It is not an order that is the result of a clerical error or slip. Nor is it an order that inserts that which is said to be omitted and which would necessarily flow, if the matter had been put to the Court or drawn to the Court's attention. If at the end of the proceedings a submission had been made that any order would be limited, in aggregate for both Laws Senior and Laws Junior, to $5 M, such an order could not have been made without leave being granted to adduce evidence (after the evidence had closed) as to the nature of the insurance policy, its wording and its limits. No such evidence was before the Court. The orders that are now sought, could not be made as a result of the evidence that had been adduced in the trial. 35 The above issue of discretion is of even greater moment when it is recalled that the orders were issued only after proposed orders were notified to the party and the reasons for judgment given and the parties addressed the Court on the appropriate relative liability as between GWS and CGU. CGU has had more than sufficient opportunity to adduce whatever evidence it has sought to adduce in these proceedings. It has chosen not to adduce that evidence and to resist a greater liability than 50 percent (the submission of GWS in the second proceedings) solely on the basis of the exercise of jurisdiction and power and not on the basis of the limits of any insurance policy known to them. 36 While the issues at trial level are different than on appeal, there are some significant similarities in this case. In Alramadan v Director Of Public Prosecutions (NSW) (No. 2) [2008] NSWCCA 69, the Court of Criminal Appeal was required to deal with an application to reopen. With some possible qualification based on the difference between criminal and civil appeal, the Court (Basten JA, Latham J and I) adumbrated the principles: "[6] Where judgment has been given but the order has not been entered, the power to reconsider an appeal is not precluded. Nevertheless, the circumstances in which the Court will be persuaded to entertain further argument (and possibly further evidence) are quite limited. In Elliott and Blessington at [31]-[32], the High Court held that the criteria by which this Court should determine an application to re-open a proceeding, prior to judgment being entered, were those stated by Mason CJ in Autodesk Inc v Dyason (No. 2) [1993] HCA 6; 176 CLR 300 at 303:

'What must emerge, in order to enliven the exercise of the jurisdiction, is that the Court has apparently proceeded according to some misapprehension of the facts or the relevant law and that this misapprehension cannot be attributed solely to the neglect or default of the party seeking the rehearing. The purpose of the jurisdiction is not to provide a backdoor method by which unsuccessful litigants can seek to reargue their cases.'

[7] Applying those principles in the present case, it is necessary to identify some misapprehension of fact or law, not solely attributable to the applicant, which materially affected this Court's judgment in the appeal.

[14] As indicated above, this is a clear case of a reopening being proposed in order to enable the applicant to reargue the appeal. If the Court acted under some misapprehension as to the relevant facts at the hearing of the appeal, that was solely due to the manner in which the appellant ran his case. There was no suggestion, it should be added, that experienced counsel who ran the appeal did so otherwise than competently. Nor was it suggested that the Court in some way obstructed the presentation of the appeal." 37 Likewise, this application is not based on any clerical error, nor any misapprehension of fact or law other than an alleged misapprehension based upon evidence not called when the hearing was in progress. CGU, with this Motion, is seeking "a backdoor method by which [it as an] unsuccessful litigant can seek to reargue its case". 38 Notwithstanding the initial submission of CGU, its later written submission no longer asserts that the limit of $5 M, which it suggests is the result of the policies in existence, is a liability that includes the costs order or the costs incurred by CGU in the proceedings. Nevertheless it continues to assert that its liability is limited, in relation to the verdicts for both Laws Senior and Laws Junior, to $5 M as, it says, the limit of the liability in the insurance policy. 39 CGU submit that the provisions of the Law Reform (Miscellaneous Provisions) Act 1946 and in particular s 6(7) limits the liability of CGU to an amount no greater the sum fixed by the contract of insurance between the insurer and the insured. It further relies on the provisions of s 601AG of the Corporations Act 2001 which defines the limit of recovery as the "amount that was payable to the company under the insurance contract". 40 It is unclear whether the provisions of the Law Reform (Miscellaneous Provisions) Act operates precisely in the way envisaged by CGU. For example, is it suggested that the limit is $5 M per claim or $5 M for the whole of the year? While the liability in the insurance policy (if it be in the same terms) is for $5 M for the entirety of the year, does that mean that the provisions of the Law Reform (Miscellaneous Provisions) Act operate in a way which would allow CGU to escape any liability because other claims have been paid? There is no evidence of any other claims, but the issue is raised solely as to whether the provisions of the Act have an effect in a manner that is slightly different from the strict application of the provisions of the insurance policy. 41 Further, CGU submit that at the point in time that the orders are enforced, CGU can rely upon the provisions of the Law Reform (Miscellaneous Provisions) Act to limit its liability to the $5 M suggested. Such a submission is not necessarily accurate. The limitation imposed by the provisions of the Law Reform (Miscellaneous Provisions) Act is a limitation that depends upon evidence. It is insufficient for Counsel at the bar table to assert the limit that is not otherwise in evidence in order for a liability, otherwise ordered, to be reduced. Thus, in the circumstances of these proceedings, it is not simply inadvertence of Counsel that has prevented orders being made in the manner suggested by CGU. The limit of the liability and the precise terms of the order made were matters upon which CGU (and the other parties) were invited to make submissions. CGU chose not to adduce evidence or make submissions as to the limit of its liability. There must be finality to litigation. CGU had ample opportunity (of which it took advantage) to amend its pleadings and to adduce evidence to seek to limit its liability to the amount submitted. It did not. If CGU had acted reasonably and sought to assert its right to limit the damages awarded against it to $5 M, it could have done so either in the substantive proceedings leading up to the first judgment, or in the consequential proceedings leading up to the second judgment. Indeed, it could have been heard on such issues prior to the judgment of 13 November 2007, at least as to liability to Laws Junior. If the Court, as I accept, were to have the jurisdiction to alter its judgment, already entered, on the basis submitted, it ought not do so as a matter of discretion. I so hold. 42 To the extent that CGU relies upon s 135 of the Uniform Civil Procedure Act 2005, that is a provision dealing with the machinery of the enforcement of judgments otherwise made. It ought, in the circumstances of this case, not be used to alter a judgment already entered. If it were capable of being so used, the discretionary exercise in relation to the alteration of a judgment would, on the same basis, result in an exercise of discretion against such an order. 43 Lastly, CGU submit that it can take separate proceedings, or ancillary proceedings, enforcing its right to limit the damages in accordance with the Act. This may be so. On the other hand, it may not be: see Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; (1988) 164 CLR 502; Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394. It is inappropriate for me to discuss the matter further. 44 The Notice of Motion filed on 22 April 2008 is dismissed. Whether or not it had been dismissed, given that the conduct of CGU in leaving to this stage the agitation of these issues is or has been wholly unreasonable, I would order that CGU pay the costs of the other parties of and incidental to the Notice of Motion. The Relevant Date for the Application of Indemnity Costs 45 I have dealt already with the necessity for finality in proceedings. I have also dealt with the applicable principles in the amendment of a judgment once entered. The Notice of Motion filed by or on behalf of Thomas Laws is in a slightly different category. It refers to an aspect of the orders made in the second judgment that were made by consent. 46 The Affidavit material upon which Thomas Laws relies asserts that the reference to June was a typographical error. No party contests that fact. Nevertheless the defendants submit that no alteration to the orders should be made. The Court order, in relevant respects, in relation to these costs, was made by consent. As a matter of fact, given the typographical error, there was no consent. In those circumstances the basis for the order is undermined. These consent orders suffer from a material mistake and it is, in those circumstances, permissible for the Court to set aside the orders: Logwon Pty Ltd v Warringah Shire Council (1993) 33 NSWLR 13; Lewis v Combell Constructions Pty Ltd (1989) 18 NSWLR 528. The Court raised with the defendants whether they asserted that there was no jurisdiction to make the alterations sought. Each defendant accepted that the Court had jurisdiction and power to do that which was requested of it. 47 Nevertheless the defendants submit that the circumstances of the Calderbank offer made were not such that they would be ordered to pay indemnity costs prior to June 2005 (the date to which they consented). 48 The circumstances of the offer and its non-acceptance is affected by the troubled history of these proceedings. 49 On Friday 5 May 2006, an offer was made by Laws Senior that the matter be resolved by the payment of a total sum of $150,000 plus costs. The offer purports to be "in accordance with the well-known Calderbank provisions". The Letter of Offer to each of the defendants asserts, correctly, that it is being made on day 5 of the hearing and seeks an answer by 10am Monday 8 May 2006, which, leaving aside the weekend and given the time of service, meant that the offer was open for a very short period of time. However the Letter of Offer made clear that if either of the defendants thought that the period of time was unreasonably short they should advise accordingly. Neither advised that the time was short. On Monday 8 May 2006, just prior to 10am, a further letter was sent by Thomas Laws confirming their offer and its expiry at 10am and requesting advice if either of the defendants required more time to obtain instructions. It requested: "Please do not ignore our offer and later submit that you did not have enough time to consider and get instructions." 50 It should be noted that neither party suggests that it did not have enough time to consider the offer and get instructions, although the submissions do assert that the Calderbank principles will not apply in circumstances where the offer was open only for a few hours: see Ghunaim v Bart (No. 2) [2006] NSWCA 82 at [28]. 51 In each case the reasonableness of the offer and the reasonableness of the time it is left open is an adjudication, which is dependent upon the particular facts of the matter before the Court. In this case, the offer was made on the last day of the first week of proceedings. It was clear at that stage that the proceedings would continue for some period of time over many weeks (and not continuously). At the time it was made, there had been a conclave of experts who had come to a view as to the likely cause of the accident. Differences of opinion by the experts on the question of the cause of the accident had been virtually eliminated. Liability was a much clearer issue and depended far more predominantly on the duty of care, rather than causation (to the extent that the two can be differentiated). Further, the entirety of the evidence of Laws Senior had concluded. 52 The principles in relation to indemnity costs were adumbrated in the judgment of the Court of Appeal in Dunstan v Rickwood (No. 2) [2007] NSWCA 266. At [43] and following, McColl JA, with whom Beazley and Ipp JJA agreed, said: "[43] The general rule is that costs payable to a person under an order of the court or the rules are to be assessed on the 'ordinary basis': UCPR 42.2.

[44] A court should only depart from the general rule and award indemnity costs where the conduct of the party against whom the order is sought is 'plainly unreasonable': Sydney City Council v Geftlick and Ors [2006] NSWCA 280 at [90] per Tobias JA, Mason P and Hodgson JA agreeing. Indemnity costs orders should be reserved for the most unreasonable actions by unsuccessful plaintiffs: Leichhardt Municipal Council v Green [2004] NSWCA 341 per Santow JA (at [57]).

[46] I will deal with the latter first. There are two well-recognised routes by which a litigant may establish a prima facie entitlement to indemnity costs. The first is by equalling or bettering an offer of compromise made in accordance with Rules of Court. The second is by writing a letter in the form approved by Cairns LJ in Calderbank v Calderbank [1976] Fam 93 (at 106) as sufficient to attract costs awarded on the same basis as if formal offer of compromise procedures had been invoked. Such a letter is conventionally headed 'without prejudice save as to costs' and the recipient is warned that at an appropriate stage the letter may be tendered to attract an indemnity costs order: see Williamson v Mig Aero Pty Ltd (McLelland J, 15 March 1991, unreported); but also now s 131(2), Evidence Act 1995; Bruinsma v Menczer (1995) 40 NSWLR 716; Jones v Bradley (No 2) [2003] NSWCA 258 (at [5]); Leichhardt Municipal Council v Green per Santow JA (at [19]).

[50] The Court's jurisdiction to award costs on an indemnity basis is not, however, confined by the making of an offer of compromise conforming with the Rules or a Calderbank offer. Such an order may also be made where a party has refused a reasonable offer of settlement. Whether or not it was reasonable for a party to reject an offer of settlement will rarely however be determined by a bald comparison between the offers made and the outcome. Rather, the question whether a party's attitude to settlement offers have been so unreasonable as to warrant an indemnity costs order requires careful analysis of the issues in the proceedings and the state of the evidence at the time the various offers were made: Rolls Royce Industrial Power (Pacific) Ltd (Formerly John Thompson (Australia) Pty Limited) v James Hardie & Co Pty Ltd (Pacific) Limited [2001] NSWCA 461; (2001) 53 NSWLR 626. That is why, prima facie, the trial judge is in the best position to make an initial assessment of this issue, a matter to which I shall return." 53 Given the indication by Laws Senior that it was prepared to extend the time during which the offer was open, and the stage that the proceedings had reached, together with the other circumstances of the proceedings, it was at least unreasonable for the defendants not to take advantage of the offer of an extension of time by which to answer. The offer was for just over half of the damages awarded. The costs of the remainder of the proceedings were likely to have been more than the total of the damages which Laws Senior was prepared to accept. That analysis must be qualified by the fact that the proceedings in relation to Laws Junior would, it seems, nevertheless have continued. 54 It seems to me that the period of a weekend and some hours was, in the circumstances of this case, not wholly unreasonable. Nevertheless it would be inappropriate to order costs on an indemnity basis solely on account of that offer. However, the attitude of the defendants not to utilise the extension of time offered was wholly unreasonable. If (of which there is no evidence) instructions were unable to be obtained in the short time available, an extension of time for a further 48 hours would have been more than a reasonable time in which to address the issue. The conduct of the defendants in not seeking further time by which to respond to the offer and thereupon accepting the offer is, in the circumstances of these proceedings, "plainly unreasonable". However, given that it was both unreasonable and inappropriate for the defendants not to have sought and obtained an extension of time (which extension was on offer), indemnity costs should run from the time to which such extension was appropriate. I would make orders varying the orders made on 2 November 2007 by deleting the dates 4 June 2006 and 5 June 2006 in order (iv) and inserting 12 May 2006 and 13 May 2006 respectively. Conclusion 55 The Court makes the following orders:

A. On the Notice of Motion filed by CGU Insurance Australia Limited of 22 April 2008: (i) Motion be dismissed; (ii) The applicant on the Motion pay the Respondents' costs of and incidental to the Motion, as agreed or assessed.

B. In 20084/02, Thomas John Laws (Laws Senior): (i) Vary the judgment of the Court dated 2 November 2007 by deleting from order (iv) thereof the dates "4 June 2006" and "5 June 2006" and insert in lieu thereof the dates "12 May 2006" and "13 May 2006" respectively. (ii) Each party shall bear his or its costs of or incidental to this motion.

12/05/2008 - The words "on an indemnity basis" have been removed. - Paragraph(s) Coversheet, Decision A(ii); 55A(ii). 16/05/2008 - [25] - "[" removed before "public liability]"; [42] - "," added after "circumstances of this case"; [54] - penultimate sentence amended to "... it was both unreasonable and inappropriate for the defendants not to have..." - Paragraph(s) [25], [42], [54]

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