McGarva v Boyd & 2 Ors

Amanda Mae McGarva (Plaintiff)

Mark Charles Boyd (First Defendant) PARTIES : Ian Drinkwater (Second Defendant)

Marine Ministerial Holding Corporation (Third Defendant) JUDGMENT OF : Master Harrison

Mr D Conti (Plaintiff) COUNSEL : Mr R Sheldon (Third Defendant) White Barnes (Plaintiff) SOLICITORS : Cutler Hughes & Harris (Third Defendant) CATCHWORDS : Extension of limitation perid - third defendant; Section 60C and s 60E ACTS CITED : Limitation Act 1969 (NSW) Brisbane South Regional Health Authority v Taylor (1996) 186 CLR; 139 ALR 1 CASES CITED : Council of the City of Sydney v Zegarac (NSWCA, unreported 26 February 1998) Morton v Jools (1992) Aust Tort Reports 81-164 McAndrew v Wyoming Nursing Home (NSWCA, unreported 5 December 1997) DECISION : See para 22

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

20123/97 - AMANDA MAE McGARVA v MARK CHARLES BOYD & 2 ORS

JUDGMENT (Extension of limitation period against) third defendant - s 60C and s 60E) 1 MASTER: By notice of motion filed 5 August 1999 the plaintiff seeks firstly, an order that the time for commencement of proceedings by the plaintiff against the Marine Ministerial Holding Corporation be extended; and secondly, that the plaintiff be given leave to amend her statement of claim so as to join the Marine Ministerial Holding Corporation as third defendant. The plaintiff relied on her affidavit sworn 27 July 1999 and four affidavits of her solicitor, Stephen O'Halloran sworn 9 August, 1999, two of 3 September 1999 and one of 15 November 1999. The defendant relied on the affidavit of Sharon Finch sworn 20 September 1999. Both of the plaintiff's deponents were cross examined. 2 The alleged facts are as follows. On the 14 January 1995 the plaintiff sustained personal injuries while travelling as a passenger in a motor vessel that collided with a moored motor vessel named "Mayhem". The first named defendant Mark Charles Boyd was the owner and driver of the motor vessel in which the plaintiff was travelling and the second named defendant Ian Drinkwater was the owner of the moored motor vessel. The proposed third defendant is the Marine Ministerial Holding Corporation. The Waterways Authority has undergone complicated legislative change stemming from around the time the plaintiff has her accident. For the purposes of this application only, it is not disputed that the third defendant is correctly named. 3 It is alleged that the Marine Ministerial Holding Corporation is the successor to the liabilities to the Maritime Services Board and its subsidiary authorities. In paragraph 8 of the proposed amended statement of claim it is alleged that as at 14 January 1995 the MSB Waterways Authority had the care, control and management of the subject waterways. Paragraph 9 asserts that the Marine Ministerial Holding Corporation became the successor to the liabilities of the former Maritime Services Board and the MSB Waterways Authority. Paragraph 10 sets out the particulars of negligence alleged against the Marine Ministerial Holding Corporation including allegations that it failed to ensure that the vessel "Mayhem" was properly moored in an area where it did not pose a significant risk to other vessels using the waterway in conditions of darkness. It is also alleged that the corporation failed to ensure that the subject vessel was properly lit or illuminated so that it could be identified in conditions of darkness. 4 For the purposes of this application I find the following facts. In so doing, I carefully observed the plaintiff both giving evidence and being cross examined and I formed the view that she was a truthful witness.

(1) On 14 January 1995 the plaintiff was in a motor vessel travelling as a passenger when it collided with a wooden motor vessel named "Mayhem".

(2) As a result of the collision the plaintiff sustained severe personal injuries namely, comminuted fracture of the pelvis on the left side, multiple fracture of the left arm, severe injury to both knees involving the ligaments of both knees, a head injury with a right front lobal contusion, internal injuries and severe bodily scarring. The plaintiff was in hospital for four months.

(3) At the time of injury the plaintiff was 32 years of age and was self employed as the proprietor of a florist shop in Mosman. As a result of her injuries the plaintiff was unable to work at all until October 1996. Since that time she has only been able to work on a part time basis.

(4) In June 1995 the plaintiff consulted solicitors, Messrs White Barnes in relation to her legal rights arising out of the accident. She placed the entire matter in the hands of her solicitors and was guided by their advice.

(5) In 1995 the plaintiff informed her solicitors of the progress of the criminal charges against Mr Boyd.

(6) On 4 July 1995 the plaintiff wrote to the Waterways Authority and the Police department seeking information by way of statements, documents and other written material that might be held in connection with the accident. Also on 4 July 1995 the plaintiff's solicitor received documents from the police service pursuant to an application under the Freedom of Information Act .

(7) Mr O'Halloran told the plaintiff that he was in contact with McClellands solicitors who acted for the other passenger in the accident Brian Smith, and that McClellands had requested documentation from the Waterways Authority in relation to the accident. Once that documentation was received there would be a sharing of facts and information. The plaintiff was content with this arrangement in view of her concern about her potential liability to pay costs.

(8) On 18 July 1995 the plaintiff wrote again to the Waterways Authority concerning the identity of the owner of one of the vessels. The Waterways Authority replied by letter dated 26 July 1995.

(9) In December 1996 and February 1997 the plaintiff consulted Mr O'Halloran at White Barnes. She authorised him to commence proceedings on her behalf against the defendants Boyd and Drinkwater and accepted advice that at that stage there was insufficient evidence to justify the institution of legal proceedings against either the Waterways Authority or the Maritime Services Board being the legal entities she understood responsible for the maritime safety on Sydney Harbour. During these discussions the plaintiff indicated to her solicitor that she was very anxious about being placed in a position where a large amount of legal work had been undertaken on her behalf without ultimately damages being recoverable. In addition she was concerned about the prospect of an order for costs being made against her in favour of either the Maritime Services Board or the Waterways Authority if these entities became a party to the proceedings which were ultimately unsuccessful. It was agreed that legal costs incurred would be kept to a minimum.

(10) On 20 February 1997 proceedings were commenced by way of statement of claim against the first and second defendants.

(11) On 17 March 1997 the plaintiff's solicitor received statements concerning the accident from the New South Wales police department. After reading those documents the plaintiff's solicitor formed the view that they were neutral in relation to whether or not there was a claim against the Waterways Authority There was no evidence that the Waterways Authority had inspected the vessel or that it knew that the Mayhem had been moored dangerously. The solicitor had considerable doubts that a lay person saying it was dangerous, gave rise to a cause of action against the third defendant. The solicitor was also aware that at that time the plaintiff may have been unsuccessful in recovering a verdict against the two defendants named in the statement of claim. There had been a refusal to indemnify Mr Boyd under his insurance policy.

(12) On 18 March 1997 the criminal charges against the first defendant were dealt with by the court.

(13) On 19 August 1997 McClellands issued a subpoena addressed the Waterways Authority returnable in court. No documents were produced.

(14) On 8 October 1997, 2 March 1998 and 29 March 1998 the plaintiff's solicitor wrote to McClellands concerning the production of documents from the Waterways Authority

(15) On 14 January 1998 the limitation period expired.

(16) On 15 July 1998 the plaintiff's solicitor received copies of statements and other material which had been obtained from the Waterways Authority pursuant to the Freedom of Information application by McClellands. The plaintiff's solicitor having perused that material was of the view that the plaintiff had a sustainable cause of action against the Waterways Authority. In particular there were statements from Mr Nugent a boating services officer in the employment of the defendant. The report of the accident dated 14 January 1995 by Mr Nugent said that it appeared that the motor cruiser (Mayhem) was in contravention of "Coll Regs" in that it did not display an anchor light at night. Additionally, the vessel was anchored in a channel or fairway but from traffic usage point of view it was not considered to be a markedly serious contravention of the rules there being minimal, if any through traffic using this course at night. He suggested that local waterway maps and signs be placed at ramps to assist boaters to become aware of the area which they were about to embark. With particular emphasis to speed zones, no wash zones and any traffic schemes that were in operation. He concluded that a master of the motor cruiser JF111M had anchored in a fairway or channel and failed to display an anchor light at night. In his memorandum dated 21 July 1995 Mr Nugent said that the vessel (Mayhem) had come to his notice a few weeks prior to the accident but he did not sight any person on or near the vessel during the intervening period and he was not sufficiently concerned about the vessel's position to endeavour to chase up the owner. However, if someone had been sighted on board he probably would have made himself known and perhaps if they had planned to stopover for a lengthy break suggest that they anchor a bit further west and closer to the shore line on the south shore. The vessel was only sighted by him in the daylight hours.

(17) On 30 July 1998 the plaintiff filed a summons seeking an order for an extension of time in which to commence proceedings against the Waterways Authority. This was eventually listed for hearing on 30 March 1999. On that day the plaintiff's legal representatives became aware that the correct defendant was not the Waterways Authority, as they had named in their proposed statement of claim and notice of motion, but Marine Ministerial Holding Corporation. The summons was dismissed.

(18) On 5 August 1999 the plaintiff filed a further notice of motion seeking the extension of the limited period as against the Maritime Ministerial Holding Corporation.

(19) The plaintiff has an ongoing disability as a result of her head, arm, pelvic and knee injuries. Medical evidence indicates that the plaintiff has a 30% permanent loss of the efficient use of each leg and will require knee replacements for both knees in the future. The plaintiff also has a 10% loss of the efficient use of her left arm. She suffers ongoing symptoms of depression and post traumatic stress disorder. She will suffer both past and future economic loss. She has recently had to sell her business. 5 I turn now to the Limitation Act 1969 (NSW) (the Act). Section 60C and E fall within subdivision 2 of the Act which is defined as the secondary limitation period. Subdivision 2 applies only to causes of action that accrue on or after 1 September 1990 ( - see s 60B). Section 60C provides: "Ordinary action (including surviving action) 60C(1)This section applies to a cause of action, founded on negligence, nuisance or breach of duty, for damages for personal injury, but does not apply to a cause of action arising under the Compensation to Relatives Act 1897. (2) If an application is made to a court by a person claiming to have a cause of action to which this section applies, the court, after hearing such of the persons likely to be affected by the application as it sees fit, may, if it decides that it is just and reasonable to do so, order that the limitation period for the cause of action be extended for such period, not exceeding 5 years, as it determines." 6 Section 60E provides: "Matters to be considered by the court 60E(1)In exercising the powers conferred on it by section 60C or 60D, a court is to have regard to all the circumstances of the case, and (without affecting the generality of the foregoing), the court is, to the extent that they are relevant to the circumstances of the case, to have regard to the following: (a) the length of and reasons for the delay;

(b) the extent to which, having regard to the delay, there is or may be prejudice to the defendant by reason that evidence that would have been available if the proceedings had been commenced within the limitation period is no longer available;

(c) the time at which the injury became known to the plaintiff;

(d) the time at which the nature and extent of the injury became known to the plaintiff;

(e) the time at which the plaintiff became aware of a connection between the injury and the defendant's act or omission;

(f) any conduct of the defendant which induced the plaintiff to delay bringing the action;

(g) the steps (if any) taken by the plaintiff to obtain medical, legal or other expert advice and the nature of any such advice the plaintiff may have received;

(h) the extent of the plaintiff's injury or loss." 7 In relation to ss 60C and 60E of the Limitation Act Mason P in Council of the City of Sydney v Zegarac (NSWCA, unreported 26 February 1998) referred to propositions which were uncontroversial. They are: (1) Section 60C confers a judicial discretion.

(2) The discretion is a discretion to grant, not a discretion to refuse, an extension of the primary limitation period. The court must be satisfied that it is "just and reasonable" to make the order for extension.

(3) In exercising the discretion, the court is required "to have regard to all the circumstances of the case" (s 60E(1)). It is also required to have regard to the 8 factors listed in s 60E(1) "to the extent that they are relevant to the circumstances of the case".

(4) Among those circumstances to which a court must have regard are the rationales for the existence of limitation periods which were identified in those passages from the Attorney General's second reading speech that are set out in the order judgments, and which McHugh J discusses in Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; 139 ALR 1. 8 I turn to consider the matters listed in s 60E(1). In relation to s 60E(1)(a) the length of delay between the expiration of the limitation period and the commencing of this action is a period of just over six months until the first application was made to the court, namely 30 July 1998. The defendant did not suffer actual prejudice by the bringing of the further application on 5 September 1999. The third defendant submitted that the plaintiff's solicitor had all the knowledge he required to commence an action against the third defendant prior to the expiration of the limitation period. The third defendant submitted that the particulars of negligence could have been drafted without recourse to Mr Nugent's reports. The plaintiff's solicitor formed a view that prior to reading Mr Nugent's reports he did not have the evidence to mount a successful case against the third defendant. On 15 July 1998 or shortly after the plaintiff's solicitor became aware that Mr Nugent, one of the third defendants boating service officers, had inspected the moored "Mayhem" prior to the accident. This changed his view. He was of the opinion after having read the police documents which he received prior to the expiry of the limitation period that the position was neutral in relation to the claim against the third defendant. Mr O'Halloran gave evidence that pleadings often cover a wider net than the case ultimately borne out by evidence at trial. At the time of the expiration of the limitation period the solicitor was aware that he was to incur only minimal costs, that he may have two defendants from whom a verdict may not be satisfied and not enough evidence to support a case against the third defendant. It is my view the solicitor's actions were correct. Even if it could be established that he acted too cautiously, the plaintiff relied on the advice of her solicitor and cannot be blamed for delays - see Morton v Jools (1992) Aust Tort Reports 81-164 and McAndrew v Wyoming Nursing Home (NWSCA, unreported 5 December 1997, Sperling J. 9 Section 60E(1)(b) refers to the prejudice that arises by reason that evidence which would have been available within the limitation period is no longer available. The proposed defendant did not put on any evidence in this regard. 10 In relation of s 60E(1)(c) and (d) the plaintiff became aware of her injuries and the nature and extent of her injuries within a few months after they occurred. She became aware that she had sustained psychological injuries as a result of the accident in October 1995. In relation to s 60E(1)(f) there is no conduct by the defendant which induced the plaintiff to delay the bringing of the action. The reasons for the non-production of documents subpoenaed by McClellands from the defendant in August 1997 are not known. 11 In relation to s 60E(1)(e) the plaintiff submitted that she only became aware that she had a sustainable case against the third defendant when she received her solicitor's advice to this effect in July 1997. From her evidence I am not persuaded that even now she is familiar with the acts and omissions of the third defendant as pleaded in the proposed statement of claim. 12 In relation to s 60E(1)(g) the plaintiff has served medical reports from her initial hospitalisation to date on the third defendant. She had acted on the advice of her solicitor and has diligently prosecuted her claim. 13 In relation to s 60E(1)(h) the extent of the plaintiff's injury or loss, the plaintiff spent four months in hospital after the accident. She was only 31 years of age when the accident occurred. She was self employed as a florist, running her own business at Mosman which she has now sold. She has ongoing disabilities and if successful, her claim will be substantial. Her working capacity has diminished and she will have to undergo future surgery. 14 It was not disputed that the plaintiff has a real case to advance against the third defendant. 15 I turn to consider delay generally. In Zegarac Mason P analysed the views of the Judges of the High Court in Taylor. The President quoted from the following passage by McHugh J. "Legislatures enact limitation periods because they make a judgment, inter alia, that the chance of an unfair trial occurring after the limitation period has expired is sufficiently great to require the termination of the plaintiff's right of action at the end of that period. When a defendant is able to prove that he or she will not now be able to fairly defend him or herself or that there is a significant chance that this is so, the case is no longer one of presumptive prejudice. The defendant has then proved what the legislature merely presumed would be the case. Even on the hypothesis of presumptive prejudice, the legislature perceives that society is best served by barring the plaintiff's action. When actual prejudice of a significant kind is shown, it is hard to conclude that the legislature intended that the extension provision should trump the limitation period.

In such a situation, actual injustice to one party must occur. It seems more in accord with the legislative policy underlying limitation periods that the plaintiff's lost right should not be revived that that the defendant should have a spent liability reimposed upon it." 16 Mason P was of the view that Dawson J agreed with McHugh J in Taylor. Mason P concluded that it could therefore be seen that Dawson and McHugh JJ appeared to indicate that it is mandatory that the applicant negate "significant prejudice" before the discretion could be exercised in his or her favour. 17 Toohey and Gummow JJ (in their joint judgment) expressed themselves in the following terms. "The real question is whether the delay has made the chances of a fair trial unlikely. If it has not there is no reason why the discretion should not be exercised in favour of the respondent." 18 Mason P perceived that there may be a distinction between the notion of "significant prejudice" and the notion that delay makes "the chances of a fair trial unlikely" but concluded that the views of the judges in Taylor represented a clear indication that mere proof of actual prejudice will not dictate a rejection of an application to extend time. Mason P then expressed respectful approval and agreement with the following statement of Kirby J in Taylor: "Although attempts have been made to spell out the criteria to be taken into account in judging whether or not an order extending time should be made, care must be taken in the use of such criteria because of the different expression of the relevant provisions of limitation statutes. Furthermore, the factual circumstances of cases are infinitely various. The discretion conferred by s 31(2) of the [Queensland] Act is controlled only by the terms of the Act and the achievement of its purposes, as elaborated above." 19 Applying this approach to s 60E(1), Mason P held: "that proof of actual prejudice, even "significant" prejudice, does not dictate the rejection of an application for extension of time. All of the circumstances of the case must be taken into account, including each factor mentioned in s 60E(1) to the extent that it is relevant to the circumstances of the case. If this is "individualised justice", it was what parliament intended. Evidence of actual or significant prejudice may lead to refusal of the application, depending on the particular circumstances of the case. In weighing prejudice, its impact upon a fair trial is the primary focus, as Toohey J and Gummow J emphasise in Brisbane South." 20 In determining whether it is just and reasonable to extend the limitation period in this application I will examine whether the plaintiff has a real case to advance and whether the delay has made "the chances of a fair trial unlikely" or whether the defendants would suffer "significant prejudice" but I will take into account that actual prejudice, even "significant prejudice" does not dictate the rejection of an application for extension of time. The third defendant did not establish that it has suffered actual prejudice. It has contemporaneous records of the accident by its own employees and statements of witnesses. It has been served with medical reports concerning the plaintiff's injuries and disabilities. However, I accept that with the passing of time the third defendant will suffer presumptive prejudice. 21 I have taken into account the eight factors listed in s 60E(1) as discussed earlier in this judgment, I am not satisfied that these matters establish that the proposed third defendant's chances of a fair trial are unlikely or that it will suffer significant prejudice. It is my view that plaintiff has discharged her onus and I am satisfied that it is just and reasonable that an order be made that she be granted an extension of the limitation period. The appropriate order for costs are that costs be costs in the cause. 22 The orders I make are:

(1) Leave is granted to join the Marine Ministerial Holding Corporation as third defendant.

(2) The plaintiff is granted an extension of time within which to commence proceedings in this court for damages in respect of injuries allegedly received by her on 14 January 1995 up to and including 13 December 1999.

(3) Leave is granted to file an proposed amended statement of claim by 13 December 1999.

(4) Costs be costs in the cause. Leave is granted to the first and second defendants to be heard if they make submissions in relation to this order. **********

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