Did the claimant place before the Court solid and substantial evidence which provided a sensible explanation for the making of the relevant admission?
92 As I have indicated, this was an issue that her Honour did not address. It therefore becomes necessary for this Court to do so. In so doing, it needs to be remembered that the claimant is not seeking to withdraw the admission made by AMMI in the s 81 notice but only to amend his defence by withdrawing the admission that he was negligent. In some future case in which it is sought to withdraw an admission of liability made under s 81, it may be necessary to consider whether the decisions in Hannaford and Ness concerning such admissions, are entirely compatible with those in Frog and Celestino.
93 I have already noted that in her statement of claim and in particular in [4] thereof, the opponent has pleaded that the claimant's insurer admitted, pursuant to s 81 of the Act, that the claimant breached his duty of care to the opponent. In the amended Notice of Grounds of Defence which the claimant seeks the Court's leave to file, [4] as well as [1], [2] and [3] of the ordinary statement of claim are still admitted and therefore available for tendering against the claimant at the trial.
94 The critical amendment sought by the claimant is leave to deny [9] of the statement of claim which alleges that the opponent's injuries were caused by the claimant's negligence.
95 In these circumstances, the evidence must establish an adequate reason based on evidence or a sensible explanation of a solid and substantial character explaining the admission of a breach of duty of care in the Notice of Grounds of Defence filed on 11 May 2004. In my opinion, the evidence establishes quite clearly an explanation as to why that admission was made at that point of time. There is no doubt that the evidence of Ms Charleston in her affidavit was evidence of a solid and substantial character and that it provided a sensible explanation as to how that defence came to be filed.
96 In essence, from the time Ms Charleston was instructed in July 2003 shortly after the opponent's solicitors instituted proceedings by way of ordinary statement of claim, she and AAMI took a number of steps between then and May 2004 (when the defence was filed) to ascertain the whereabouts of the claimant and Mr Vikilani for the purposes of interviewing them and otherwise obtaining a statement as to their evidence. It was obvious from the police report that the insurer was placed in a difficult position in terms of defending the proceedings without being able to call evidence from the claimant and his witness, Mr Vikilani.
97 It is true that it might have been appropriate for Ms Charleston to have informed her opposition that those enquiries were proceeding, but that notwithstanding, it is apparent that significant efforts were made to ascertain the whereabouts of the claimant and, when they were unsuccessful, on 10 May 2004 there was a change in investigator in order ultimately to achieve a result. A statement of the claimant was received from the investigator by the claimant's solicitor on or about 21 July 2004 and shortly thereafter the opponent's solicitor was put on notice that it was proposed to put breach of duty of care in issue when an application for a rehearing on the issue of liability only was filed on 2 August 2004.
98 As I have observed, it was not until on or about 21 July 2004 that AAMI received the report from Cox dated 20 July 2004 which revealed that they had located and interviewed the claimant. In the meantime, a judge of the Court had on 11 May 2004 ordered that Notice of Grounds of Defence be filed by 4pm on 12 May 2004. In these circumstances, as the investigator's efforts had not at that point in time produced a result, it is understandable that the grounds of defence filed in accordance with the Court's order at that point admitted breach of duty of care.
99 The same comment applies to the arbitration which was set down by the Court for hearing on 24 June 2004. It proceeded upon the issue of quantum only given that at that time the insurer had not received Cox's report. As I have already observed, on 2 August 2004 Ms Charleston caused to be filed an application for a rehearing on the issue of liability notwithstanding that at that point of time she had not received the further report from Cox relating to the locating and interview of Mr Vikilani which did not occur, and which was not the subject of a report received by the insurer, until on or about 16 August 2004.
100 Accordingly, the opponent's solicitor was put on notice of the proposed denial of breach of duty before AAMI obtained corroboration from Mr Vikilani of the description of the accident obtained from the claimant.
101 Had it been relevant, I would not have endorsed the withdrawal by the insurer of its admission of breach of duty on behalf of the claimant contained in the s 81 notice. As I have already observed, no explanation was forthcoming as to why that admission was made and, in particular, there was no evidence that the author of the letter constituting that notice, Ms Hibberd, was not available to provide that explanation. Notwithstanding that, as far as the evidence goes, the admission was made in circumstances where the opponent admitted that she had no relevant memory of the accident whereas the claimant did, and given that the only attempt to contact the claimant was by the letters from Ms Hibberd to him of 14 September 2006 and November 2000 in respect of which there was no evidence that they were returned unclaimed but merely not responded to, it is difficult to understand why in light of that material Ms Hibberd considered it appropriate or necessary to admit breach of duty of care.
102 An available explanation for the admission may have been that Ms Hibberd was influenced by the fact, which could be proved by Constable Clyne who attended the accident, that the collision clearly occurred in the lane in which the opponent was driving in circumstances where it could also be proved through Constable Clyne that the claimant's vehicle was turning across that lane in front of her. Prima facie, therefore, notwithstanding that the opponent had no memory of the collision, she may have been able to say that as far as she was aware she had not run a red light given that she had told the Constable that she did not feel drowsy at the time. In the absence of the claimant to prove that he only turned right on the green arrow, the opponent's evidence may, without evidence of contradiction, have been sufficient to obtain her a verdict. However, in the absence of evidence from Ms Hibberd, I am only speculating.
103 Notwithstanding the foregoing, it was clearly open to the insurer to deny liability: it was under no compulsion to admit liability in the circumstances. Further, had it denied liability, it was still open to it to later admit liability (see s 81(4)) if, for instance, efforts to locate and interview the claimant and Mr Vikilani ultimately proved unsuccessful. In those circumstances, like Master Harper in Wyer, there is no reason why this Court should not take at face value, difficult though it is to do so, the statement of Ms Hibberd in the s 81 notice that the insured had
"completed looking into the circumstances surrounding your client's motor vehicle accident."
104 There was no explanation to suggest that the admission of fault and breach of duty contained in that notice was other than made with deliberateness and formality. On the other hand, given the opponent's lack of memory of the collision and the evidence which would be elicited from the claimant and Mr Vikilani in accordance with their records of interview, any admission of breach of duty made by AAMI prior to locating the whereabouts of the claimant and Mr Vikilani and a statement of their version of events would, to adopt what Santow J said in Drabsch, be contrary to the actual facts. In this regard, there was nothing in the material to suggest that the claimant and Mr Vikilani would not make honest and reliable witnesses and, in fact, the investigator reported that they would.
105 It follows from the foregoing that in my opinion the primary judge's discretion miscarried and that, in the circumstances, the amendment to the Notice of Grounds of Defence sought by the claimant should have been granted.
106 Although her Honour did not deal with the matter, that amendment should extend to the allegation of contributory negligence. It was not suggested that, if the Court was of the view that the claimant was entitled to amend his defence to deny the allegation of negligence in [9] of the statement of claim, he ought not to be permitted to plead contributory negligence.
107 The position may have been different had that amendment not been allowed so that the withdrawal of the admission of breach of duty of care made in the Notice of Grounds of Defence filed on 11 May 2004 was refused. In this respect, Master Harper in Wyer (at [36]) expressed the view that the admission of breach of duty of care was not inconsistent with an assertion by the defendant that the plaintiff was guilty of contributory negligence. This was to be contrasted with an admission of liability generally which, in the Master's view, would have been inconsistent with a subsequent assertion of contributory negligence. However, in the present case, there was no admission or denial of liability (although that is what s 81(1) calls for), but only an admission both in the s 81 notice and the filed Notice of Grounds of Defence of an admission that the claimant had breached his duty of care to the opponent.
108 At the hearing of the appeal the claimant submitted that if the Court refused leave to amend the Notice of Grounds of Defence to withdraw the admission of breach of duty of care, nonetheless it should permit an amendment to plead contributory negligence. At the time the Court did not consider that it was necessary to hear the opponent on that issue. However, having further considered [36] of Master Harper's judgment in Wyer (which was not drawn specifically to our attention during the oral argument), we called upon the opponent's counsel to provide supplementary written submissions on the issue, which he has done. However, in the circumstances, it is unnecessary to consider the force of those submissions or otherwise to rule upon the correctness and applicability to the present case of the point made by Master Harper in [36] of his judgment in Wyer that an admission of breach of duty of care only was not inconsistent with an assertion of contributory negligence. The point becomes academic if otherwise the Court grants leave to amend the Notice of Grounds of Defence to deny negligence.
109 So far as the question of costs is concerned, the claimant should, of course, have his costs of the summons for leave to appeal and of the appeal. So far as the costs of the hearing of the Notice of Motion before the primary judge is concerned, in my view the claimant was seeking an indulgence and ought to bear the costs of that motion. I would therefore not disturb her Honour's order to that effect. It is unnecessary to deal with the costs of the arbitration as both parties have sought a rehearing, the claimant on the issue of liability and the opponent on the issue of quantum. Accordingly, the costs of the arbitration will abide the result of the ultimate trial of those issues and it is unnecessary to make any special costs order with respect thereto.