It appears that his Honour may have concluded that the valuation was not a fact material to the appellant's case because the valuation was 'speculative' and 'could hardly be called decisive' because it was based upon the appellant's description of her goods. While the respondents might use that circumstance to mount a challenge to the reliability of the valuation, in my opinion it was inappropriate to dismiss the materiality of the valuation on that basis. A list of the goods sold at auction had been provided by the auctioneers. The description given by the appellant to Mr Kearns might be accepted by a trial judge as accurate and as a reasonable basis for the valuation by Mr Kearns."

On 3 March 2000 the Full Court remitted the plaintiff's application to the trial judge. He had to determine whether she had satisfied the court that in all the circumstances of her case, the grant of an extension of time was just.

The trial judge conducted a hearing of the remitted application. Further submissions were made. No further evidence was called. The trial judge refused to exercise his discretion to grant an extension of time.[6] It is from that decision the that plaintiff now appeals.

In his reasons for declining to grant an extension of time, the trial judge said:

"I think it is apparent from the nature of the proceedings that the plaintiff has never accepted that advice, which advice I believe is accurate. A significant proportion of the Kearns valuation was based on quotations obtained by the plaintiff early in 1992. I accept that the valuation may amount to a material fact for the purposes of section 48 and in my view has been prepared or manufactured for the purpose of the issue of the proceedings but in reality adds nothing new to the plaintiff's actual knowledge of her loss. This is a matter which must be born in mind in exercise of discretion."

I consider that clear error has been demonstrated. The trial judge either misunderstood or misapplied the Full Court ruling.

The Full Court found that the valuation provided two new facts material to the issue of damages. It provided information in regard to the amount of market value. Further, the existence and contents of the valuation itself were material to the plaintiff's case "in the sense that the valuation represented available evidence that could be called in support of her case."

In concluding that the valuation "in reality adds nothing new to the plaintiff's actual knowledge", the trial judge erred. He failed to recognise that the plaintiff had learned for the first time of the market value of her goods through the valuation.

The trial judge erred in failing to consider or give any weight to the fact of the existence and contents of the valuation as available evidence to be called in support of the plaintiff's case.

The trial judge had no basis for concluding that the valuation was "prepared or manufactured for the purpose of the issue of the proceedings." The reference to manufacture carries the pejorative meaning "to invent fictitiously; concoct; devise"[7] and "the fabrication of false statements."[8] This conclusion was not substantiated by the evidence available.

The trial judge failed to give any weight to the fact that the defendants were facing tribunal proceedings until late 1997. Their awareness of that ongoing claim is a material matter in the exercise of discretion to extend time.[9] The trial judge's failure to have regard to this matter was an error vitiating the exercise of his discretion.

For these reasons the decision of the trial judge must be set aside. The plaintiff's application must be reconsidered.

Counsel for the plaintiff submitted that the trial judge erred in concluding that the plaintiff had received a letter in July 1997 from Mr Baldock which put her on notice of the limitation period applicable to her case. The trial judge found that the letter had been sent but he did not make any express finding as to whether it had been received by the plaintiff. The evidence supported the trial judge's finding that the letter had been sent. There was a specific note on the solicitor's copy that it had been "posted".

The plaintiff gave evidence that she had no memory of receiving the letter. However she did not deny that it was received. The appropriate conclusion is that the letter was received by the plaintiff. However her evidence that she could no longer recall receiving the document and her lack of awareness of its contents can be accepted. The judge found the plaintiff to be generally reliable. The evidence does not justify a finding to the contrary.

The letter was sent. It was received, but for reasons that are unexplained, the plaintiff has no memory of its receipt or its contents. The issue of fact has been resolved. Given the history of this matter it is desirable and appropriate that this court determine the application for an extension of time.

The High Court considered the interpretation of the Limitation of Actions Act 1974 (Qld) in Brisbane South Regional Health Authority v Taylor.[10] The terms of the Queensland legislation were as follows:

"s 31(2) Where on application to a court by a person claiming to have a right of action to which this section applies, it appears to the court -

(a) that a material fact of a decisive character relating to the right of action was not within the means of knowledge of the applicant until a date after the commencement of the year last preceding the expiration of the period of limitation for the action; and

(b) that there is evidence to establish the right of action apart from a defence founded on the expiration of a period of limitation;

the court may order that the period of limitation for the action be extended so that it expires at the end of 1 year after that date and thereupon, for the purposes of the action brought by the applicant in that court, the period of limitation is extended accordingly."

It is to be observed that the Queensland legislation requires an applicant to establish specific criteria. Once established, the court's discretion is enlivened. This is to be contrasted to the scheme of the South Australian legislation. Section 48 of the Limitation of Actions Act provides the court with an unfettered discretion to extend time. However this power is then limited to circumstances where the court is satisfied that specific criteria have been established. The discretion is subjected to the overriding requirement that:

"in all the circumstances of the case it is just to grant an extension of time."

In Brisbane South Regional Health Authority different views were expressed as to the proper approach that should be taken when dealing with applications to extend time.

Toohey and Gummow JJ enunciated the following test at (547-550):

"The discretion conferred by the sub-section is to order an extension of the limitation period. It is a discretion to grant, not a discretion to refuse, and on well established principles an applicant must satisfy the court that grounds exist for exercising the discretion in his or her favour. There is an evidentiary onus on the prospective defendant to raise any consideration telling against the exercise of the discretion. But the ultimate onus of satisfying the court that time should be extended remains on the applicant. Where prejudice is alleged by reason of the effluxion of time, the position is as stated by Gowans J in Cowie v State Electricity Commission (Vict) in a passage which was endorsed by Gibbs J in Campbell v United Pacific Transport Pty Ltd:

'It is for the respondent to place in evidence sufficient facts to lead the Court to the view that prejudice would be occasioned and it is then for the applicant to show that these facts do not amount to material prejudice.'

Once an applicant satisfies pars (a) and (b), the Court has a discretion to extend the time for the bringing of an action. A material consideration (the most important consideration in many cases) is whether, by reason of the time that has elapsed, a fair trial is possible. Whether prejudice to the prospective defendant is likely to thwart a fair trial is to be answered by reference to the situation at the time of the application. It is no sufficient answer to a claim of prejudice to say that, in any event, the defendant might have suffered some prejudice if the applicant had not begun proceedings until just before the limitation period had expired.

In this regard we have difficulty with the notion of weighing prejudice to an applicant against prejudice to the respondent. In one obvious sense the prejudice to the present respondent is absolute if her application is refused. She can never litigate her claim. But that cannot be enough of itself to warrant an extension of time; in truth there would be no discretion to be exercised. For that reason we do not accept the respondent's argument that the District Court fell into error in failing to balance the prejudice to the appellant against the prejudice against the respondent. It may be appropriate to temper that approach and to say that because the respondent has satisfied par (b) of sub-s (2), there is therefore evidence to establish her right of action. Even then, a weighing process is not called for. 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."

"Courts and commentators have perceived four broad rationales for the enactment of limitation periods. First, as time goes by, relevant evidence is likely to be lost. Second, it is oppressive, even 'cruel', to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed. Third, people should be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them. Insurers, public institutions and businesses, particularly limited liability companies, have a significant interest in knowing that they have no liabilities beyond a definite period. As the New South Wales Law Reform Commission has pointed out:

'The potential defendant is thus able to make the most productive use of his or her resources and the disruptive effect of unsettled claims on commercial intercourse is thereby avoided. To that extent the public interest is also served.'

Even where the cause of action relates to personal injuries, it will be often just as unfair to make the shareholders, ratepayers or taxpayers of today ultimately liable for a wrong of the distant past, as it is to refuse a plaintiff the right to reinstate a spent action arising from that wrong. The final rationale for limitation periods is that the public interest requires that disputes be settled as quickly as possible.

In enacting limitation periods, legislatures have regard to all these rationales. A limitation period should not be seen therefore as an arbitrary cut off point unrelated to the demands of justice or the general welfare of society. It represents the legislature's judgment that the welfare of society is best served by causes of action being litigated within the limitation period, notwithstanding that the enactment of that period may often result in a good cause of action being defeated. Against this background, I do not see any warrant for treating provisions that provide for an extension of time for commencing an action as having a standing equal to or greater than those provisions that enact limitation periods. A limitation provision is the general rule; an extension provision is the exception to it. The extension provision is a legislative recognition that general conceptions of what justice requires in particular categories of cases may sometimes be overridden by the facts of an individual case. The purpose of a provision such as s 31 is 'to eliminate the injustice a prospective plaintiff might suffer by reason of the imposition of a rigid time limit within which an action was to be commenced.' But whether injustice has occurred must be evaluated by reference to the rationales of the limitation period that has barred the action. The discretion to extend should therefore be seen as requiring the applicant to show that his or her case is a justifiable exception to the rule that the welfare of the State is best served by the limitation period in question. Accordingly, when an applicant seeks an extension of time to commence an action after a limitation period has expired, he or she has the positive burden of demonstrating that the justice of the case requires that extension."

Dawson J agreed with McHugh J but added at (544):

"The section confers a discretion upon a court to extend time and that discretion should only be exercised in favour of an applicant where, in all the circumstances, justice is best served by so doing. The onus of satisfying the court that the discretion should be exercised in favour of an applicant lies on the applicant. To discharge that onus the applicant must establish that the commencement of an action beyond the limitation period would not result in significant prejudice to the prospective defendant. I agree with McHugh J that, once the legislature has selected a limitation period, to allow the commencement of an action outside that period is prima facie prejudicial to the defendant who would otherwise have the benefit of the limitation."

Kirby J approached the matter differently saying at (565-566):

"The purposes of the particular legislation here in question are neatly encapsulated in two passages from decisions of this Court and of the House of Lords. The two passages state the competing policies which lie behind, respectively, the general rule of the limitation bar (s 11 of the Act) and the exceptions affording power to provide an extension (s 31 of the Act). In Donovan v Gwentoys Ltd, Lord Griffiths explained the general rule behind the limitation bar:

'The primary purpose of the limitation period is to protect a defendant from the injustice of having to face a stale claim, that is, a claim with which he never expected to have to deal.'

On the other hand, this Court explained the purposes of provisions such as s 31 in Sola Optical Australia Pty Ltd v Mills thus:

'[T]he broad purpose of the Act was ... to eliminate the injustice a prospective plaintiff might suffer by reason of the imposition of a rigid time limit within which an action was to be commenced.'

The residual discretion invoked in this case was therefore to be exercised in a way that gave effect to the exception but in the context of a statute designed also to uphold the general rule.

In some Australian limitation statutes, the provision for an extension has referred explicitly to criteria which must be taken into account, for example whether it is 'just' or 'just and reasonable' or 'fair and equitable' to provide the extension. In the Queensland Act no such formulae are used. Instead, the word 'may' is used as a word of perfect generality. But it cannot be doubted that similar broad notions of justice to the parties are introduced by the use of that word.

It will be rare that the passage of time does not cause at least some disadvantages to a prospective defendant (eg, the erosion of memory; the loss of documents; and the death, departure or disappearance of witnesses). But precisely what that disadvantage is in a particular case is better determined on evidence than on the basis of judicial generalities about time, the importance of finality and the usual desirability of prompt action for the fair trial of contested issues."

"... once the preconditions are made out, the positive burden on the applicant would not be one of any great severity. But if, weighing the countervailing evidence, the judge is uncertain or unconvinced that the provision of an extension would be just, it should be refused.

"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 Act is controlled only by the terms of the Act and the achievement of its purposes, as elaborated above."

The decision in Brisbane South Regional Health Authority has been the subject of considerable judicial discussion. Attention has been drawn repeatedly to the different tests formulated by the court.[11] At times, a preference for one or other test has been expressed. However the correct approach has not been settled. Most decisions since Brisbane South Regional Health Authority have reached the same conclusion on the application of either test. The remarks in Brisbane South Regional Health Authority were directed towards the Queensland legislation. It is important to address the legislation in question in any subsequent case.

On the hearing of this appeal, the Brisbane South Regional Health Authority matter was not raised and this issue was not the subject of submissions by counsel.

The application of either test leads to the same conclusion in this matter. Although this is not the occasion to express a concluded view about the correct approach, I consider that when dealing with an application to extend time the overriding enquiry should be - can there be a fair trial? The South Australian legislative scheme supports such an approach as it leaves the court with an unfettered discretion once an applicant has met the qualifying condition.[12]

The South Australian Parliament enacted a scheme that provided a qualifying condition for an applicant seeking a discretionary grant of an extension of time. Once that condition was satisfied it "left all the rest to the discretion of the court".[13]

Has the appellant in the circumstances of this case satisfied the court that it is fair and just to grant an extension ?

It would be unfair and inequitable to grant an extension if the defendants had suffered any real prejudice by the delay but as in Napolitano, the defendants have had ongoing notice of the claim.

The defendants were on notice that the plaintiff intended to pursue her claim and that she had done so since late 1991. They had constant reminders of that intention. The only period when a claim was not before the tribunal or the District Court was between October 1997 and May 1998.

The defendants were aware that the facts in issue in the proceedings may have had to be canvassed in the event that the tribunal proceeded to a hearing. They had to be prepared to meet that claim. The defendants did not identify by affidavit or evidence any specific prejudice they would suffer if an extension of time were granted. Since 1972, every defendant knows or ought to know that the lapse of the statutory period does not lead to absolute immunity from suit.

It was not suggested that the defendants had failed to take steps to obtain and preserve the evidence necessary for their defence. Apart from the presumptive prejudice that arises from delay and its insidious effect on the memory of witnesses, no other prejudice has been identified by the defendants.

The history of these proceedings demonstrates that this is not a case of anything other than presumptive prejudice. Significant prejudice or the real possibility of significant prejudice has not been established. In these circumstances, the plaintiff has discharged the onus of establishing that the commencement of the action beyond limitation period would not result in significant prejudice to the defendants.

The circumstances outlined support a finding that a fair trial can occur despite the delay. Approaching the matter in the manner outlined by Toohey and Gummow JJ in Brisbane South Regional Health Authority, the issue is primarily one of a fair trial, rather than prejudice whether presumptive or otherwise. As their Honours said at (550):

"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."

Applying this test, I am of the view that the delay has not made the chances of a fair trial unlikely.

I consider the application for an extension of time should be allowed.

LIST OF JUDGMENT CITATIONS AS THEY APPEAR IN THE JUDGMENT

1 In these reasons the appellant is referred to as the plaintiff and the respondents as the defendants

3 [1987] HCA 57; (1987) 163 CLR 628

4 Pomeroy v Thwaites Witham Pty Ltd & Anor [1999] SADC 80

5 2000 SASC 44

6 Pomeroy v Thwaites Witham Pty Ltd & Anor (No 2) [2000] SADC 78

8 (The) Shorter Oxford English Dictionary 3rd edition 1973 at (1275)

9 Napolitano v Coyle (1977) 15 SASR 559 at (569)

10 [1996] HCA 25; 1996) 186 CLR 541 at (544)

11 Henrick v Agnew (1998) 26 MVR 277; (1996-1997) 9 ANZ Insurance Cases [61-382]; Sydney City Council v Zegarac (1997-98) 43 NSWLR 195; Mason v Murray's Charter Coaches and Travel Services Pty Ltd [1998] FCA 1430; (1998) 159 ALR 45; Paramasivam v Flynn [1998] FCA 1711; (1999) 160 ALR 203; Kinnas v Petricca (1999) 28 MVR 539; Holt v Wynter [2000] NSWCA 143; (1999-2000) 49 NSWLR 128

12 Napolitano v Coyle (1977) 15 SASR 559 at (569)

13 Napolitano v Coyle (1977) 15 SASR 559 at 569; Lovett v Le Gall (1975) 10 SASR 479 at (486), (491-2.)

[1] In these reasons the appellant is referred to as the plaintiff and the respondents as the defendants

[2] Limitation of Actions Act 1936 (SA) s 35

[3] [1987] HCA 57; (1987) 163 CLR 628

[4] Pomeroy v Thwaites Witham Pty Ltd & Anor [1999] SADC 80

[5] [2000] SASC 44

[6] Pomeroy v Thwaites Witham Pty Ltd & Anor (No 2) [2000] SADC 78

[7] The Macquarie Dictionary 1997 3rd edition at (1313)

[8] The Shorter Oxford English Dictionary 1973 3rd edition at (1275)

[9] Napolitano v Coyle (1977) 15 SASR 559 at (569)

[10] [1996] HCA 25; (1996) 186 CLR 541 at (544)

[11] Henrick v Agnew (1998) 26 MVR 277; (1996-1997) 9 ANZ Insurance Cases [61-382]; Sydney City

Council v Zegarac (1997-98) 43 NSWLR 195; Mason v Murray's Charter Coaches and Travel

Services Pty Ltd [1998] FCA 1430; (1998) 159 ALR 45; Paramasivam v Flynn [1998] FCA 1711; (1999) 160 ALR 203; Kinnas v Petricca

(1999) 28 MVR 539; Holt v Wynter [2000] NSWCA 143; (1999-2000) 49 NSWLR 128

[12] Napolitano v Coyle (1977) 15 SASR 559 at (569)

[13] Napolitano v Coyle (1977) 15 SASR 559 at (569); Lovett v Le Gall (1975) 10 SASR 479 at (486), (491-2.)