Mead v Hukins

Bringing the Legal System into Disrepute

1. When the property damage proceedings went to the Court of Appeal, Justice Sackville said at [18]: "…It is unfortunate that two separate proceedings have been on foot arising out of the same accident. The Personal Injury Proceedings have not yet been heard in the District Court. Neither Mr Mead nor Mr Hukins (or their insurers) is a party to the Property Proceedings, presumably they will not be bound by any findings made in the Property Proceedings. It is therefore open to Mr Mead and Mr Hukins, through their insurers, to re-litigate all factual issues that are determined in the Property Proceedings."
2. Justice Ward and Justice Hall, the other members of the Court of Appeal, agreed with the reasons of Justice Sackville. However, the passage at para [18] referred to above is not part of the ratio of the case. His Honour's remarks were obiter dicta, but any judge of the District Court would pay heed to an intuitive view expressed by a judge of the Court of Appeal.
3. Further, Justice Sackville said at [19]: "Quite apart from questions of costs and duplication of judicial resources, there is a possibility that the two sets of proceedings will produce inconsistent decisions. While the parties to the two proceedings are different, the decisions may be inconsistent in the sense that the same events may give rise to inconsistent factual findings and inconsistent findings on liability. This is an outcome calculated to bring the legal system into disrepute and should be avoided if possible. It is the need to avoid contradictory judgments which lies at the heart of the so-called Anshun estoppel. The Anshun principle prevents a party from bringing an action which, if it succeeds, will result in a judgment conflicting with an earlier judgment, where it was unreasonable for the party not to put its case in the earlier proceedings."
4. Once again, the remarks of Justice Sackville in para [19] were obiter dicta. The defendant in the present case portrayed its motivation to bind the plaintiff and the defendant in these proceedings to the 60/40 result in the property damage proceedings, as altruistic. It was submitted that to allow a trial of the same issues in the personal injury proceedings might result in inconsistent verdicts which would bring the legal system into disrepute. The fact that the defendant wishes to retain that result and the plaintiff opposes being bound to that result could possible arise in part from a view of the defendant that the 60/40 split was a good result from his point of view, whereas the present plaintiff may think that he can do better than 60/40.

The Defendant's Motion

1. At the commencement of the hearing of the motion I raised concern about the form of the orders sought. Orders 1 and 2 effectively sought a judgment on liability in accordance with the decision of Judge Hatzistergos. However, the rule relied upon in each case was a rule concerning determination of a separate question, and no separate question had been formulated by the defendant, the applicant on the motion.
2. Orders 3 and 4 sought to strike out the proceedings or the pleadings in total. Order 5 sought a permanent stay of the proceedings. Order 6 sought the striking out of paragraphs 6 and 7 of the Amended Statement of Claim. Senior Counsel for the defendant conceded that it was not appropriate to consider or make such orders. He made it plain that he was pursuing the motion so as to achieve the aim of binding the parties to the 60/40 liability result achieved in the property proceedings.
3. Upon the raising of these concerns, Senior Counsel drafted a separate question for determination as follows: "With reference to the findings of the District Court, Doble Express Transport P/L v John L. Pierce P/L [2015] NSWDC 285 that: 1. The plaintiff was guilty of contributory negligence and 2. The contributory negligence was 40% ("the findings"): A. Do the findings give rise to an issue estoppel that is binding on the parties in the current proceedings. B. Alternatively, do the findings give rise to an Anshun estoppel that is binding on the parties in the current proceedings C. Alternatively does the plaintiff's contention that the findings are not binding in the current proceedings amount to an abuse of process in the current proceedings."
4. Counsel for the plaintiff pointed out that the court must first make a determination pursuant to r 28.2 of the Uniform Civil Procedure Rules 2005 (NSW), that an order should be made for the decision of any question, before the trial. It is only after the court has determined that there should be the determination of a separate question, that the court can exercise its power under r 28.4 to dismiss the proceedings or the whole or any part of any claim for relief in the proceedings, or give any judgment, or make any other order.
5. I find that it is appropriate to make an order for the determination of the separate question identified by the defendant. Sooner or later a judge will have to determine that matter. If I were to decline to entertain the defendant's application now, it would no doubt be made before the trial judge, which could delay the finalisation of the proceedings. Further, I have had the benefit of detailed evidence and well-argued submissions by experienced counsel on both sides.
6. I therefore order that the separate question identified in Exhibit DX3 is to be determined by me on the defendant's application.

Evidence on the Motion

1. The defendant's solicitor Ms Bulluss affirmed an affidavit dated 29 June 2016. Her client, the CTP insurer of the present defendant, was unaware of the property damage proceedings until after judgment was delivered. Correspondence then took place between the solicitors for the plaintiff and the solicitors for the defendant, in relation to whether the plaintiff would agree to the 60/40 split. The affidavit annexed an excerpt from the transcript of the property damage proceedings, demonstrating that the plaintiff's solicitors had been aware of the existence of the property damage proceedings "for a considerable time".
2. The defendant also relied upon an affidavit of Ms Singer, solicitor, sworn on 8 September 2017. This affidavit annexed all of the pleadings from the property damage proceedings and set out the chronology of the course of those proceedings through the District Court, the Court of Appeal, and the High Court of Australia.
3. The defendant also tendered some documents from the file of the plaintiff's solicitor. A file note dated 4 June 2013 demonstrates that the plaintiff's solicitor was discussing with the plaintiff "the recovery of personal items that were damaged in the truck". A subsequent letter dated 28 October 2014 from the plaintiff's solicitor to the plaintiff, advised the plaintiff not to consent to being joined as a plaintiff in the property damage proceedings, but to attempt to negotiate a settlement for the value of the personal items of the plaintiff destroyed in the crash.
4. A file note of the plaintiff's solicitor shows that on 12 May 2015 he discussed the problem of possible issue estoppel with the plaintiff himself, and with counsel for the plaintiff.
5. Finally, an email of 12 May 2015 sent by the plaintiff's solicitors to the solicitors for the solicitors for the property damage insurer of Doble, referred to the possibility of an issue estoppel arising and requested consent to vacation of the hearing date in the property damage proceedings, and the joinder of both actions for determination at a later time.
6. The plaintiff's solicitor swore an affidavit on 1 December 2017. He was of the initial view that no issue estoppel or Anshun estoppel could arise, because he believed that Mr Mead was not a party to the property damage proceedings. On the day prior to commencement of that hearing, his counsel advised him that the High Court of Australia had reserved its decision in Tomlinson v Ramsey Food Processing Pty Limited, and that the outcome of that case could raise the risk of an issue estoppel arising in Mr Mead's personal injury case.
7. The plaintiff's solicitor set out the steps he would have taken to run the liability issue in the personal injury case, over and above the evidence called by the property damage insurer. The affidavit also pointed out that the injuries of the plaintiff had not stabilised, and that further surgery was then contemplated.
8. Mr Mead swore an affidavit on 30 November 2017. He said that he never entered into a retainer or costs agreement with the solicitors who acted for the property damage insurer of his employer. At no time did he believe or understand that he was a client of those solicitors. At the request of his employer, Mr Mead provided details of the personal items which he had lost in the accident. He did not realise that he was to be part of the case in relation to those items. He was not aware that he had even been made a party to the proceedings until the morning of the hearing, when he was informed of that matter by his current solicitors in the personal injury action. It was then that he was informed of the possible issue estoppel that could arise. He said that at no stage were instructions sought from him in relation to the pleadings or the running of the property damage action, by the solicitors or counsel acting for the property damage insurer. His understanding at all times was that he was merely to be a witness in the property damage proceedings.
9. Mr Mead was required to attend court for cross-examination, but in the end no questions were asked of him. His evidence thus stood unchallenged.

Issue Estoppel

1. In Tomlinson v Ramsey Food Processing Pty Limited [2015] HCA 28; (2015) 256 CLR 507, the High Court, speaking of the doctrine of issue estoppel, said at [22]: "Estoppel in that form operates to preclude the raising in a subsequent proceeding of an ultimate issue of fact or law which was necessarily resolved as a step in reaching the determination made in the judgment. The classic expression of the primary consequence of its operation is that a 'judicial determination directly involving an issue or fact or of law disposes once for all of the issue, so that it cannot afterwards be raised between the same parties or their privies' - Blair v Curran (1939) 62 CLR 464 at 510, 531-533."
2. In the present case neither Mr Mead nor Mr Hukins were parties to the decision of Judge Hatzistergos. Can it be said that Mr Mead was a privy of his employer Doble?
3. In Stewart v Government Insurance Office of NSW (1996) 39 NSWLR 531, President Mahoney said [at 533G-534B]: "The determination of who is a privy and in what circumstances is not easy to determine. It has been said that authorities of assistance in this regard are not extensive: see Carl Zeiss Stiftung v Rayner & Keeler Limited (No. 2) [1967] 1 AC 853 at 936, per Lord Gust; see generally G Spencer Bower & A Turner on The Doctrine of Res Judicata, 2nd Edition at 209. There is no golden thread which one may follow through the decisions; in so far as there are categories or descriptions of the classes of cases in which there is or is not privity, the verbal formulae employed in relation to them are, at the least, indeterminate and, no doubt necessarily so. In Ramsay v Pigram (1967) 118 CLR 271, Barwick CJ (at 279) saw privies as of three classes: blood, title and interest."
4. In Tomlinson, the High Court said at [35]: "Subsequent applications of the principle in Ramsay v Pigram have for the most part correctly emphasized that the interest of the privy must in each case be a legal interest: an economic or other interest on the part of A in the outcome of the earlier proceedings is insufficient. Those applications have also correctly emphasized that, absent a legal interest, such influence as A might have had over the conduct of the earlier proceeding is irrelevant even if that influence amounted to control."
5. The High Court also said at [39]: "The justice of binding to an estoppel a person who was a party to an earlier proceeding is readily apparent: the person has already had an opportunity to present evidence and arguments. The justice of binding to an estoppel a person whose legal interests stood to benefit from the making or defending of a claim by someone in an earlier proceeding will often also be apparent. With the benefit of the claim or defence also comes the detriment of the estoppel. That, at least, is the underlying theory. But it is a theory which has limitations. It would be quite unjust for such a person to be precluded from asserting what the person claims to be the truth if the person did not have an opportunity to exercise control over the presentation of evidence and the making of arguments in the earlier proceeding and if the potential detriment to the person from creating such an estoppel was not fairly taken into account in the decision to make or defend the claim in the earlier proceeding or in the conduct of the earlier proceeding."
6. Mr Mead certainly was not a privy in blood or title in relation to the earlier proceedings. Can it be said that he was a privy in interest?
7. The case before Judge Hatzistergos concerned property damage to a truck owned by Doble and a truck owned by Pierce. Once the claim for damage to personal property owned by Mr Mead, which was in the Doble truck, was removed, Judge Hatzistergos was not deciding a case which involved any right or interest of Mr Mead.
8. Further, Mr Mead had no opportunity to present evidence or arguments. He did not stand to benefit from the making or defending of the property damage claim. It would be unjust for Mr Mead to be now precluded from asserting what he claims to be the appropriate result, based upon evidence which he has control over calling, since he did not have those opportunities in the earlier proceedings.
9. I find that there is no issue estoppel arising from the earlier property damage proceedings, which binds Mr Mead in his own personal injury claim. That result was also reached by the Court of Appeal in a similar case to the present. In Spratt v Perilya Broken Hill Ltd [2016] NSWCA 192 at [4], the court said: "…There was no issue estoppel. Mr Spratt's motor accident claim is against the driver of the vehicle. His District Court action joins both the driver and the employer, but the liability of the latter is purely vicarious. When this was raised by the court, Mr Spratt conceded, properly, that the driver could not be regarded as privy of his employer. As such he could not be bound by any issue estoppel."
10. My answer to the separate question raised in section A of DX3, being "Do the findings give rise to an issue estoppel that is binding on the parties in the current proceedings" is "no".

Anshun Estoppel

1. In Tomlinson the High Court recognised that another form of estoppel was Anshun estoppel, named after the decision of the High Court in Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 587. In Tomlinson, the High Court said that Anshun estoppel was sometimes referred to as the "extended principle" in Henderson v Henderson (1843) 67 ER 313. In Henderson, Sir James Wigram V.C. said: "Where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case."
2. In Anshun itself, the two defendants were the hirer of a crane and the owner of a crane. Both were sued by a workman who suffered injury arising out of the hirer's use of the crane. The defendants sought contribution from each other. Damages were awarded against both defendants and the owner was found to be liable for 90% of the damages and the hirer liable for 10% of the damages. The owner then brought a separate action against the hirer claiming a contractual indemnity in respect of all the amounts it had paid to the workmen as damages and costs. The trial judge ordered that the action should be stayed on the grounds that the claim under the agreement should have been raised in the original action and hence the owner was estopped from raising it.
3. The High Court held that the order of the trial judge was correct. It had been unreasonable of the owner to refrain from raising the indemnity point in the first action, since the indemnity agreement was a defence to the hirer's claim for contribution, and was so closely connected with the subject matter of that action that it was to be expected that the owner would raise it as a defence. Further, the High Court said that a judgment on the indemnity action would conflict with the judgment entered on the contribution proceedings.
4. It is to be noted that the Anshun estoppel in that case operated to prevent a party raising, in subsequent proceedings, a defence or claim which should have been raised in the first action. By contrast, Mr Mead was not a party to the property damage proceedings and thus could not have raised his claim for personal injury in those proceedings. Further, it is to be noted that the lawyers acting for Mr Mead in respect of his personal injury appeared at the property damage proceedings and asked for it to be adjourned, so that the two actions could be heard together at a later time. That was refused on a discretionary basis by Judge Hatzistergos, who proceeded with the trial of the property damage action alone.
5. The defendant submitted that the Anshun principle has a wider application and can apply even where the parties in the subsequent proceedings are not the parties in the earlier proceedings. The authority cited for that proposition was the decision of the Court of Appeal Habib v Radio 2UE Sydney Pty Limited [2009] NSWCA 231 per McColl J at [83].
6. In Habib a person who claimed to have been defamed by a newspaper article sued the newspaper publisher in the Supreme Court. The pleadings also alleged that the publisher defendant "caused to be published" three radio broadcasts referring to the article. The plaintiff commenced separate proceedings for defamation in the District Court in respect of the radio broadcasts. It was argued that the Anshun principle meant that he should have brought those proceedings in the Supreme Court, when he sued the newspaper publisher. Thus Habib concerned a party who was asserting similar rights, but against different defendants, in different courts. It is to be noted that in the present case Mr Mead had no interest in the property damage proceedings, was not a party and was not asserting any right. Nor did he stand to benefit from the property damage litigation.
7. The conclusion of the Court of Appeal in Habib was that it was not unreasonable, in the Anshun sense, for the appellant not to have joined the radio defendants, as defendants in the Supreme Court proceedings against the newspaper publisher. He had distinct defamation claims against the publisher and the radio broadcasters in respect of different publications. The Court of Appeal set aside an order made in the District Court proceedings, staying the action against the radio broadcasters as an abuse of process.
8. My conclusion is that Anshun estoppel does not apply. If Mr Mead had been a party to the property damage proceedings, and if he had an interest in the outcome of those proceedings, then an Anshun estoppel might well run against him. However, as a non-party to those proceedings, there was absolutely nothing he could do to bring forward his personal injury claim in those property damage proceedings, which were litigated between others. He was at law a stranger to the action heard by Judge Hatzistergos.
9. The application of Anshun where the parties are not the same, is not as broad as put in submissions by the defendant. As previously recited, Habib involved a case where a citizen sued a newspaper for defamation, and in a different forum sued radio broadcasters for defamation. It is understandable that Anshun was argued, as Mr Habib had the opportunity, should he have so chosen, to bring his radio defamation proceedings in the Supreme Court at the same time as suing the newspaper publisher. Mr Mead had no such opportunity.
10. My answer to section B of the separate question, being "Do the findings give rise to an Anshun estoppel that is binding on the parties in the current proceedings" is "no".

Abuse of Process

1. The defendant relied upon the explanation by the High Court in Tomlinson of the relationship between the doctrine of estoppel and the doctrine of abuse of process. At [24]-[26] the High Court said: "24 To explain contemporary adherence to the comparatively narrow principle in Ramsay v Pigram, it is appropriate also to explain the relationship between the doctrine of estoppel and the doctrine of abuse of process as it has since come to be recognised and applied in Australia. The doctrine of abuse of process is informed in part by similar considerations of finality and fairness. Applied to the assertion of rights or obligations, or to the raising of issues in successive proceedings, it overlaps with the doctrine of estoppel. Thus, the assertion of a right or obligation, or the raising of an issue of fact or law, in a subsequent proceeding can be simultaneously: (1) the subject of an estoppel which has resulted from a final judgment in an earlier proceeding; and (2) conduct which constitutes an abuse of process in the subsequent proceeding. 25 Abuse of process, which may be invoked in areas in which estoppels also apply, is inherently broader and more flexible than estoppel. Although insusceptible of a formulation which comprises closed categories, abuse of process is capable of application in any circumstances in which the use of a court's procedures would be unjustifiably oppressive to a party or would bring the administration of justice into disrepute . It can for that reason be available to relieve against injustice to a party or impairment to the system of administration of justice which might otherwise be occasioned in circumstances where a party to a subsequent proceeding is not bound by an estoppel. 26 Accordingly, it has been recognised that making a claim or raising an issue which was made or raised and determined in an earlier proceeding, or which ought reasonably to have been made or raised for determination in that earlier proceeding, can constitute an abuse of process even where the earlier proceeding might not have given rise to an estoppel . Similarly, it has been recognised that making such a claim or raising such an issue can constitute an abuse of process where the party seeking to make the claim or to raise the issue in the later proceeding was neither a party to that earlier proceeding, nor the privy of a party to that earlier proceeding, and therefore could not be precluded by an estoppel." (Emphasis added)
2. The defendant submitted that the re-litigation of the issue of liability already determined in the property damage proceedings constitutes an abuse of process, where the use of the court's procedures would bring the administration of justice into disrepute. Such disrepute could arise if there were inconsistent verdicts.
3. For the plaintiff it was submitted that Mr Mead and Mr Hukins had no control over the property damage proceedings themselves. Nor did the plaintiff or the defendant or the CTP insurer of the defendant play any part in the earlier litigation. Further, they were not entitled to play any part in that action as they were not parties.
4. It could not be said that allowing the personal injury proceedings brought by Mr Mead to continue would be "unjustifiably oppressive to a party". Mr Hukins, and indeed his third party insurer, were not parties to the property damage proceedings. They are not in the position of a person who was a party to those proceedings, who had a full opportunity to conduct the case as they saw fit, and who was then bound by the result.
5. Can it be said that allowing the personal injury case to proceed would "bring the administration of justice into disrepute"? The power to stay proceedings permanently on the ground that they are an abuse of process must be exercised with caution and only in the most exceptional or extreme case - Walton v Gardiner [1993] HCA 77; (1993) 177 CLR 378 at 392. The onus of satisfying the court that there is an abuse of process lies upon the party alleging it and the onus is "a heavy one" - Williams v Spautz [1992] HCA 34; (1992) 174 CLR 509 at 529.
6. If Mr Mead was seeking, in his personal injury action, to re-litigate a point which he had lost in some earlier proceedings, that would be an abuse of process. That would be so even if he was not a party, providing that he was involved in those earlier proceedings in some fashion. For example, even though not a party he might have obtained a benefit from the proceedings. In the alternative, even though not a party he might have controlled how those earlier proceedings were run. Mr Mead did not fall into any category of litigants who are abusing the process of the court by seeking to re-litigate a point which has been determined in earlier proceedings. Justice Sackville in the appeal from Judge Hatzistergos recognised that there could be inconsistent verdicts in the present case, and that this could arguably bring the legal system into disrepute.
7. However, what would bring the legal system into greater disrepute, would be to say to a person who suffered personal injuries in an accident, that they could not litigate their claim at all, because of earlier litigation to which they were not a party, and from which they took no benefit, and over which they exercised no control. What would bring the legal system into disrepute in those circumstances would be denying a person a legal remedy, where other parties, acting entirely in their own interests and without regard to the interests of Mr Mead, had litigated their own claim. Finally, the legal system would be brought into disrepute if Mr Mead was denied the opportunity to seek damages for his personal injury, where he had actually made an application to halt the property damage proceedings, to avoid the risk of the present argument being raised by the defendant. While Judge Hatzistergos refused his application, for sound discretionary reasons, it would be harsh indeed if Mr Mead was held to the result in that case, when his representatives had appeared and attempted to protect his interests, which clearly did not align with those of the parties to the property damage proceedings.
8. For those reasons, I do not think that this case falls into the category of cases which constitute an abuse of process. My answer to section C of the separate question, being "Does the plaintiff's contention that the findings are not binding in the current proceedings amount to an abuse of process in the current proceedings" is "no".

Orders

1. I make the following orders: 1. Order that the separate question set out in Exhibit DX3 be determined. 2. Answer the separate question as follows: With reference to the findings of the District Court in Doble Express Transport Pty Limited v John L Pierce Pty Limited [2015] NSWDC 285 that the plaintiff was guilty of contributory negligence; and the contributory negligence was 40% (the findings): Question A Do the findings give rise to an issue estoppel that is binding on the parties in the current proceedings? Answer: No. Question B Alternatively, do the findings give rise to an Anshun estoppel that is binding on the parties in the current proceedings? Answer: No. Question C Alternatively, does the plaintiff's contention that the findings are not binding in the current proceedings amount to an abuse of process in the current proceedings? Answer: No. 1. Dismiss the defendant's Notice of Motion filed on 30 June 2016. 2. Order the defendant to pay the plaintiff's costs of the motion.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 08 March 2019