Matton Developments Pty Ltd v CGU Insurance Limited

SUPREME COURT OF QUEENSLAND

CITATION: Matton Developments Pty Ltd v CGU Insurance Limited (No 2) [2016] QCA 285

PARTIES: MATTON DEVELOPMENTS PTY LTD ACN 100 028 340 (applicant) v CGU INSURANCE LIMITED ACN 004 478 371 (respondent)

FILE NO/S: Appeal No 4741 of 2015 / SC No 1704 of 2011

DIVISION: Court of Appeal

PROCEEDING: Miscellaneous Application – Civil

ORIGINATING COURT: Supreme Court at Brisbane – [2015] QSC 72

DELIVERED ON: 8 November 2016

DELIVERED AT: Brisbane

HEARING DATE: 1 September 2016

JUDGES: Margaret McMurdo P and Fraser and Morrison JJA / Joint reasons for judgment of Margaret McMurdo P and Morrison JA; separate reasons of Fraser JA, dissenting in part

ORDERS: “$123,750 being the agreed sum for loss of revenue.” / “$788,524.14 for interest pursuant to s 57 Insurance Contracts Act 1984 (Cth) for the period 1 April 2009 until 23 August 2016 and $291.83 per day thereafter until payment of the judgment sum.”

CATCHWORDS: APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – POWERS OF COURT – AMENDMENT OF ORDERS – where the Court of Appeal published its reasons and orders on the appeal – where the respondent applied, pursuant to r 667(1) of the Uniform Civil Procedure Rules 1999 (Qld), for an order to set aside three subparagraphs of the orders made – where the orders were made on the assumption that the sums referenced in the three subparagraphs were based on an “agreed sum” – where the basis of the application to set aside the orders was that the sums were not actually agreed upon by the parties – whether the orders should be set aside / Uniform Civil Procedure Rules 1999 (Qld), r 667(1), r 766(6)(b)

COUNSEL: R N Traves QC, with A F Messina, for the applicant / G A Thompson QC, with K F Holyoak, for the respondent

SOLICITORS: Redchip Lawyers for the applicant / BarryNilsson for the respondent

MARGARET McMURDO P AND MORRISON JA: On 23 August 2016 this Court published its decision on the appeal.¹ The orders proposed by the President and agreed by Morrison JA (Fraser JA dissenting) were as follows:

“1. The appeal is allowed with costs.

The judgment below is set aside.

Instead, the respondent is to pay the appellant:

$1,397,934 being the agreed quantum for the total loss of the crane;

$530,000 being the agreed sum for the loss of revenue for the period 1 February 2009 to 30 November 2012;

$326,970 being the agreed sum for loss of revenue for the period 1 December 2012 to 15 April 2015;

$378.00 per day being the agreed daily rate for loss of revenue from 15 April 2015 to the date of this order;

interest under s 57 Insurance Contracts Act 1984 (Cth) from 1 April 2009 to the date of this order;

costs as agreed or assessed on the standard basis.”

On 25 August 2016 the respondent (CGU) applied, pursuant to r 667(1) of the Uniform Civil Procedure Rules 1999 (Qld),² for an order that paragraphs 3(b), (c) and (d) of those orders be not made, or set aside.

The basis for that application was that the sums were not actually agreed. In essence, it was said that:

the sums reflected a calculation based on two assumptions, namely that the insurance policy between the appellant (Matton) and CGU had been repudiated by CGU’s failure to pay under it, and that repudiation had been accepted by Matton;

the learned trial judge found that there was no repudiation by CGU, and even if there was, there was no acceptance of that repudiation by Matton;³

the notice of appeal contained a ground challenging that finding (ground 24);

however, that ground was not dealt with on the appeal;

consequently the orders should be set aside or not made so that the issue could be agitated; and

the correct figures should have been those payable under the policy, namely $123,750 for loss of revenue and interest under s 57 of the Insurance Contracts Act 1984 (Cth),⁴ but nothing for consequential losses as they could only be claimed if the policy was terminated.

Some further explanation is required as to how this issue came about after the appeal was heard and judgment delivered.

The notice of appeal included ground 24, which was:⁵

“24.The learned primary judge erred in finding that the plaintiff did not terminate the policy of insurance, because of the defendant’s repudiation of it by failing to indemnify the plaintiff in respect of the damage to the crane.”

The notice of appeal then sought orders relevantly as follows:⁶

“3.Judgment for the appellant as follows:

a)$1,397,934.00 being the agreed quantum for the total loss of the crane;

b)$530,000.00 being the agreed sum for loss of revenue for the period 1 February 2009 to 30 November 2012;

c)$326,970.00 being the agreed sum for loss of revenue for the period 1 December 2012 to 15 April 2015 (865 days at the agreed daily rate of $378.00);

d)$378.00 per day being the agreed daily rate for loss of revenue from 15 April 2015 to the date of this order;”

In each case the orders sought were for sums described as an “agreed sum” or an “agreed daily rate”. Nothing was said by CGU to indicate that the sums were not, in fact, agreed.

On the hearing of the appeal senior counsel for Matton orally abandoned various grounds of the notice of appeal. Ground 24 was not one of them. However, the Court was told that there was effectively only one ground being pursued, namely whether the overload on the crane was accidental or not:⁷

“In essence, there’s the one ground we’re pursuing, and it’s the meaning and effect of the accidental overload clause when applied to the facts, effectively as found by the trial judge.”

That is expressly noted in the reasons of Fraser JA,⁸ in a paragraph which we adopted.⁹

The oral submissions to this Court on appeal, by both Matton and CGU, did not deal with ground 24, and nothing was said to counter the assertion in the notice of appeal that the sums were agreed sums.

The result of that state of affairs, particularly the fact that the appeal was apparently conducted on the basis that there was only one issue to resolve, was that we proposed orders reciting what the Court had been told were agreed figures not in issue.

On the application under r 667 UCPR, to vary this Court’s orders of 23 August 2016, heard by this Court on 15 September 2016, senior counsel for Matton said that ground 24 was not pressed, but sought an opportunity to argue that, even if the policy had not been terminated there was, nonetheless, an ability on an insured to claim damages by way of consequential losses for late payment. He placed reliance upon r 766(6)(b) UCPR, and a passage in Sutton’s Insurance Law in Australia.¹⁰ Further he pointed to part of Matton’s outline below, and the submissions below, in support of an argument that the learned trial judge’s reasons wrongly attributed a concession to Matton, as to the scope of damages that could be, and were, claimed if there was no repudiation.

In those circumstances the Court reserved its decision on the application by CGU, and gave leave to both parties to file further submissions as to whether orders 3(b), (c) and (d) should be changed. Senior counsel for Matton gave his client’s undertaking not to seek to enforce paragraphs 3(b), (c), (d) and (e) of the orders made on 23 August 2016.¹¹

The parties filed outlines of submissions in accordance with the orders made on 1 September 2016.

Matton’s outline reveals that:

CGU has filed an application in the High Court for a grant of special leave to appeal against the orders of this Court on the appeal; and

notwithstanding the President’s request that the order made on 23 August 2016 not be taken out, on an unknown date the Deputy Registrar did file the order.

In those circumstances Matton consents to orders 3(b), (c), (d) and (e) being set aside, and in their place the following orders being made:

“(b)$123,750 being the agreed sum for loss of revenue;

(c)$788,524.14 for interest pursuant to s 57 Insurance Contracts Act 1984 (Cth) for the period 1 April 2009 until 23 August 2016 and $291.83 per day thereafter until payment of the judgment sum.”

Matton proposes that upon CGU giving an undertaking to proceed expeditiously with the special leave application, and any resultant appeal, all orders of this Court (as varied) be stayed until the later of either the determination of the special leave application or the determination of any resultant appeal. Matton also propose that each party’s costs of the application be borne by that party.

CGU neither consents to, nor opposes, the orders outlined in paragraph [17] above, and the proposed order as to the costs of the application. However it makes it plain that Matton’s proposed orders are not the result of any “agreement or contract” between it and Matton, and are not “by consent”.¹² CGU goes on to say that the proposed orders “are not intended to, and do not, abrogate or prejudice [CGU’s] rights in respect of the special leave application of [CGU] pending in the High Court …”.

CGU consents to Matton’s proposed stay and gives the undertaking sought.

Rule 667, UCPR relevantly provides:

“(1)The court may vary or set aside an order before the earlier of the following—

the filing of the order;

the end of 7 days after the making of the order.

The court may set aside an order at any time if—

….

the party who has the benefit of the order consents;…”

The application by CGU was filed and heard before the relevant orders were filed, and therefore the power under r 667(1)(a) is applicable.¹³ The application was filed before the end of seven days after the orders were made, and therefore r 667(1)(b) is applicable. In any event, Matton is the party with the benefit of the orders proposed to be set aside, it consents to them being set aside, and there is no suggestion the proposed variation to the orders will affect the interests of third parties.¹⁴ Therefore r 667(2)(e) is applicable. It gives power to set aside an order even if it has been filed. We also note that, in any case, the order may not have been properly filed as it was filed contrary to the President’s direction to Registry staff.

On any view, the orders proposed by Matton should be made to enable CGU to proceed with its application in the High Court, and any consequent appeal. Neither party now seeks that the application be determined, at least pending CGU’s application for special leave. Whilst the order as to costs is not by consent, it is a pragmatic reflection of the fact that there has been no determination of the application, and may never be.

We propose the following further orders:

In respect of the orders made by the Court of Appeal on 23 August 2016, pursuant to r 667(1) of the Uniform Civil Procedure Rules 1999 (Qld):

paragraphs 3(b), 3(c), 3(d) and 3(e) are set aside;

in place of paragraph 3(b), an order is made in the following terms:

“$123,750 being the agreed sum for loss of revenue.”

in place of paragraph 3(e), an order is made in the following terms:

“$788,524.14 for interest pursuant to s 57 Insurance Contracts Act 1984 (Cth) for the period 1 April 2009 until 23 August 2016 and $291.83 per day thereafter until payment of the judgment sum.”

By consent, upon CGU Insurance Limited undertaking to proceed expeditiously with the application for special leave and any resultant appeal, all of the orders of the Court of Appeal made on 23 August 2016 (as varied by paragraph 1 above) are stayed until the later of either the determination of the application for special leave in the High Court, or if special leave is granted, the determination of the appeal.

Each party bear its own costs of and incidental to this application.

FRASER JA: I have had the advantage of reading in draft the judgment of the President and Morrison JA. I do not join in making proposed Order 1 because it is inconsistent with my dissenting judgment in the appeal. I agree with the proposed consent order for a stay of the Court’s orders in the appeal and the proposed order that each party bear its own costs of this application.

Footnotes

1. Matton Developments Pty Ltd v CGU Insurance Limited [2016] QCA 208. ↩

2. Hereafter “UCPR”. ↩

3. [2015] QSC 72 at [221]-[222]. ↩

4. As found by the learned trial judge, and not disputed on appeal, if the policy was on foot: [2015] QSC 72 at [228]-[229]. ↩

5. AB 777. ↩

6. AB 777. ↩

7. Appeal transcript, T1-3 line 40. ↩

8. [2016] QCA 208 at [20]. ↩

9. [2016] QCA 208 at [2] and [76]. ↩

10. Insurance Law in Australia, Sutton, 4th ed., page 189. ↩

11. The undertaking actually referred to the orders being made on 27 October 2015, but that was clearly an erroneous reference to the date the appeal was heard. ↩

12. CGU’s outline 12 October 2016, paragraph 2. ↩

13. Hayes v Westpac Banking Corporation & Anor [2015] QCA 260 at [34]-[35] per Mullins J, Holmes CJ and Philippides JA concurring.