Pukeroa v Berkely Challenge P/L & Ors [2005] QCA 49

PROCEDURE - INFERIOR COURTS - QUEENSLAND - DISTRICT COURTS - CIVIL JURISDICTION - PRACTICE - PROCEDURE BEFORE TRIAL - OTHER MATTERS - joinder of defendants - where proceedings commenced against first defendant - where first defendant joins third parties - whether joinder of third parties as second and third defendants without compliance with pre-court procedures - meaning of 'proceeding' - Personal Injuries Proceedings Act 2002 (Qld)

PROCEDURE - INFERIOR COURTS - QUEENSLAND - DISTRICT COURTS - CIVIL JURISDICTION - PRACTICE - PROCEDURE BEFORE TRIAL - OTHER MATTERS - joinder of defendants - where proceedings commenced against first defendant - where first defendant joins third parties - whether joinder of third parties as second and third defendants without compliance with pre-court procedures - whether no obligation to comply where potential practical difficulties associated with expeditious compliance - Personal Injuries Proceedings Act 2002 (Qld)

PROCEDURE - COSTS - GENERAL RULE - COSTS FOLLOW THE EVENT - COSTS OUT OF A FUND - WHEN COSTS ALLOWED OUT OF A FUND - where no basis upon which order under appeal could properly have been made - part played by unsuccessful respondent - whether respondent's contentions fairly arguable - Appeals Costs Funds Act 1973 (Qld)

Acts Interpretation Act 1954 (Qld), s 36

District Court of Queensland Act 1967 (Qld), s 118

Law Reform Act 1995 (Qld), s 6(c)

Motor Accident Insurance Act 1994 (Qld)

Personal Injuries Proceeding Act 2002 (Qld), s 4, s 6(2), s 9, s 10, s 16, s 17, s 29, s 35, s 36, s 38(6), s 41

Supreme Court of Queensland Act 1991 (Qld), Schedule 2

Uniform Civil Procedure Rules 1999 (Qld), r 5, r 8, r 69,

Workers' Compensation and Rehabilitation Act 2003 (Qld),

s 10(1), s 32, s 275

Bonser v Melnacis [1999] QCA 280; [2002] 1 Qd R 1, followed

Devlin v South Molle Island Resort [2003] QSC 20; [2003] 2 Qd R 347, cited

Hordern-Richmond Limited v Duncan [1947] KB 545, followed

Inglis v Connell & Suncorp Metway Insurance Ltd [2003] QDC 29, cited

Lauchlan v Hartley [1980] Qd R 149, applied

Legnoverde v Lenard's - Kenmore (2004) 24 Qld Lawyer 324, cited

Red Ru Pipeline Construction Company Pty Ltd v State of Queensland [1990] 1 Qd R 389, cited

[1] WILLIAMS JA: The circumstances in which this court is now asked to consider certain provisions of the Personal Injuries Proceedings Act 2002 ("PIPA") are fully set out in the reasons for judgment of White J which I have had the advantage of reading. I agree with her Honour's analysis and with the conclusions reached, but it is desirable that I add some observations of my own with respect to the relevant operation of PIPA.

[2] The critical provision is s 9 which relevantly provides:

"(1) Before starting a proceeding in a court based on a claim, a claimant must give written notice of the claim, in the approved form, to the person against whom the proceeding is proposed to be started."

[3] Properly construed that must mean that every person against whom a proceeding is started must have been given notice of the claim in accordance with the requirements of PIPA. Rule 8 of the UCPR provides that a "proceeding starts when the originating process is issued by the court". Rule 74(4) deals with the situation where an additional defendant is added; the "proceeding against the new defendant . . . starts on the filing of the amended copy of the originating process". It follows, in my view, that unless some other provision of PIPA provides to the contrary, s 9 thereof must apply to the present applicants; in other words the giving of the required notice is a condition precedent to starting proceedings against the applicants.

[4] That leads to a consideration of s 6 which is relevantly set out in the reasons for judgment of White J. Subsection (1) thereof makes it clear that the general proposition is that PIPA applies to "all personal injury"; when that is read with

s 9(1) it follows that PIPA applies to all persons against whom proceedings with respect to such an injury are to be started unless otherwise provided by the Act. That follows from the definition of "claim" which means "a claim . . . for damages based on liability for personal injury". The only exceptions to the application of PIPA are set out in s 6(2). Given the wording of those sub-paragraphs it is clear that the exceptions only apply when the claimant is required to comply with the

pre-court procedures laid down in the Motor Accident Insurance Act 1994 or the Workers' Compensation and Rehabilitation Act 2003. Thus it is not sufficient for the exemption to apply that the injury is caught by the definition of "injury" in the Workers' Compensation and Rehabilitation Act 2003; the exemption only applies to such an injury where damages with respect thereto are sought pursuant to chapter 5 of that Act.

[5] That was also the conclusion reached by Philippides J in Devlin v South Molle Island Resort [2003] 2 Qd R 346.

[6] Mr Grant-Taylor SC for the respondent submitted that there were good reasons for construing the legislation in such a way as not to impose an obligation upon the respondent to comply with the requirements of PIPA with respect to the applicants. It was submitted that as proceedings had already started there would be a necessary delay in now requiring the respondent to take those steps. Further, it was submitted that there would be unnecessary expense incurred in subjecting the respondent to further medical examination at the request of the applicants, and there would have to be another, unnecessary, compulsory conference. Such considerations do not, in my view, call for a construction to be placed on the legislative provisions in question contrary to their ordinary, natural meaning as indicated above. Counsel for the applicants stated to the court that the present applicants would facilitate compliance with the requirements of PIPA and all necessary steps should be completed within the limitation period.

[7] If in any case disputation between defendants in a personal injury action to which PIPA applied was likely to result in unnecessary delay or increased costs, the court has ample powers to deal with the situation and to ensure that a plaintiff is not prejudiced thereby.

[9] WHITE J: The applicants seek leave pursuant to s 118 of the District Court of Queensland Act 1967 to appeal from an interlocutory judgment in the District Court in which Robertson DCJ gave leave to the plaintiff to join the applicants, who were the first and second third parties in the proceedings, as defendants to the claim brought by the plaintiff and made other consequential orders.

[10] The applicants contend that leave ought to be given because a point of law of general importance is involved in that the appeal concerns the scope and application of the Personal Injuries Proceedings Act 2002 ("the PIPA") and, in particular, the proper construction of s 6(2)(b) and its relationship to the Workers' Compensation and Rehabilitation Act 2003 ("the WCRA").

[11] The respondent does not oppose leave being given.

[12] Since the appeals concern the construction of an important provision of the PIPA which does not appear to have been considered at appellate level and is of general application it is appropriate that leave be given.

[13] It is convenient to refer to the respondent as "the plaintiff", her employer who is not a party to this appeal as "the employer", and the appellants as "the first and second third parties".

[14] The plaintiff who was employed by the defendant as a cleaner sustained personal injury on the evening of 6 August 2002 at her place of employment in a shopping centre at Maroochydore. The plaintiff alleged that as she walked through dock 7 in the direction of the centre management office past industrial bins she slipped on a liquid substance and fell to the ground. This fall she alleged was brought about by the negligence of her employer. In her statement of claim filed in the District Court at Maroochydore on 28 April 2004 she alleged that, inter alia, the fall was caused by the failure of the employer to provide safe plant and equipment in that the industrial bins which she walked past had a hole or holes in the bottom which without bungs or some other plug allowed liquid or other substances to leak out and thereby caused a slipping hazard; and that the employer ought to have provided non-hazardous flooring.

[15] By its notice of intention to defend and defence filed 12 May 2004 the employer alleged, inter alia, that it was not responsible for the industrial bins and any liquids therein were not placed by the employer or with its authority or approval; and that the surface of the ground where the plaintiff slipped was not under its care, custody or control.

[16] On the day it filed its defence the employer joined Lend Lease Property Management (Australia) Pty Ltd, the managing agent of the shopping centre, as first third party and Brambles Australia Limited, the provider of the industrial bins at the shopping centre, as second third party alleging negligence and/or contribution from them both.

[17] The plaintiff applied to the District Court at Maroochydore to join the first and second third parties as defendants to her claim. In her amended statement of claim exhibited to her application the plaintiff alleged against the first third party as occupier of the non-leased area, relevantly, dock 7 of the shopping centre premises, negligence by failing to provide adequate lighting and permitting tenants to place liquid waste or substances into the industrial bins and failing to ensure that the bins did not leak liquid onto the floor of dock 7. The plaintiff alleged negligence against the second third party in failing to ensure the bins did not leak liquid onto the floor or by failing to ensure that the drainage holes in the bins were properly sealed.

[18] There is no limitation period issue immediately involved although it will expire on

6 August this year. The first and second third parties do not contend that they are not appropriate parties to the plaintiff's proceedings. Rather, they contend that the plaintiff must first satisfy the pre-court procedures of the PIPA in relation to the claims against them before joinder and in that contention they were unsuccessful below. The plaintiff has carried out all of the pre-court procedures required by the WCRA.

[19] Section 6 of the PIPA provides, relevantly,

"(1) This Act applies in relation to all personal injury arising out of an incident ...

(2) However, this Act does not apply to -

(a) personal injury as defined under the Motor Accident Insurance Act 1994 and in relation to which that Act applies; or

(b) injury as defined under the Workers' Compensation and Rehabilitation Act 2003, but only to the extent that an entitlement to seek damages, as defined under that Act, for the injury is regulated by chapter 5 of that Act."

If the injury sustained by the plaintiff falls within s 6(2)(b) then the provisions of the PIPA do not apply. The learned judge below concluded that the injury did fall within the WCRA. His Honour concluded that the plaintiff would not have sustained an injury had she not been engaged in her employment and accordingly her injury occurred in the course of the employment and therefore the provisions of the PIPA did not apply. Mr M Grant-Taylor SC who appeared on behalf of the plaintiff does not seek to uphold his Honour's reasons for granting the plaintiff leave to join the first and second third parties as defendants, accepting that the entitlement to seek damages against the third parties was not regulated by chapter 5 of the WCRA but does seek to uphold the orders made on different grounds.

Mr Grant-Taylor contends here, as he did in supplementary submissions below, that on its proper construction, s 9 of the PIPA does not prohibit the joinder of the third parties and therefore the order was properly made.

[20] It is necessary, briefly, to dispose of the basis of the orders made below. Section 32 of the WCRA defines "injury" relevantly as

"(1) ... [a] personal injury arising out of, or in the course of employment if the employment is a significant contributing factor to the injury."

Chapter 5 regulates a worker's entitlement to damages. "Damages" are defined in

"(1) ... damages for injury sustained by a worker in circumstances creating, independently of this Act a legal liability in the worker's employer to pay damages to -

The plaintiff's claim against the third parties is not based on a liability for injury arising out of or in the course of her employment with either of them. It is not, accordingly, a claim for damages for injury as defined in the WCRA, regulated by chapter 5 of that Act and exempted from the ambit of the PIPA by s 6(2)(b).

[21] Turning then to the submission that ss 9 and 36 of the PIPA do not prohibit the orders for joinder being made, those sections provide respectively:

"(1) Before starting a proceeding in a court based on a claim, a claimant must give written notice of the claim, in the approved form, to the person against whom the proceeding is proposed to be started."

"(1) Before starting a proceeding in a court based on a claim, there must be a conference of the parties (the "compulsory conference")."

[22] The plaintiff's principal contention is that there is only one "proceeding" for the purposes of ss 9 and 36, that is, her claim against the employer commenced in the District Court pursuant to the provisions of the WCRA. Section 275 of the WCRA provides, similarly to s 9 of the PIPA, that "[b]efore starting a proceeding in a court for damages, a claimant must give notice under this section ... in the approved form ...". Having done so, Mr Grant-Taylor contended, there is no prohibition on adding a party to that proceeding in conformity with the Uniform Civil Procedure Rules.

[23] "Proceeding" is not defined in either the PIPA or the WCRA. The definition in the Acts Interpretation Act 1954 s 36, "a legal or other action or proceeding", does not advance the argument. Mr Grant-Taylor submitted that its meaning could most appropriately be derived by analogy with "cause" as used in the former Rules of the Supreme Court O 90 r 9 "when no proceeding has been taken in a cause ...". In Red Ru Pipeline Construction Company Pty Ltd v State of Queensland [1990] 1 Qd R 389 Derrington J, with whom Thomas and Ambrose JJ agreed, was aided by the definition of "cause" in the Judicature Act 1876 in deciding whether taking a step against the first defendant in that case within the 3 years stipulated in the rule permitted a step to be taken without leave in respect of the second defendant after 3 years. "Cause" in the Judicature Act included "any suit, action or other original proceeding between a plaintiff and a defendant". His Honour concluded at 391 that this was a reference to the "matter as a whole rather than to any feature constituted by a relationship between one party and another only". That conclusion does not assist the plaintiff.

[24] The plaintiff's application to join the third parties was made pursuant to UCPR r 69. Although r 8(1) provides that a proceeding starts when the originating process is issued by the court, the proper characterisation of a proceeding after a person has been included as a party, so far as it concerns that party, is set out in r 74(4).

It provides that if an order is made including a person as a defendant "the proceeding against the new defendant ... starts on the filing of the amended copy of the originating process". That is also consistent with the definition of "proceeding" in Schedule 2 of the Supreme Court of Queensland Act 1991 which includes "an incidental proceeding in the course of, or in connection with, a proceeding."

Until joined as defendants the third parties were not parties to the plaintiff's proceedings against the employer. So much is plain from the provisions in the UCPR relating to third party proceedings. The third party procedure is anomalous in as much as the entitlement of a defendant to bring a third party before the court is the third party's liability to make contribution or to pay an indemnity to the defendant. That entitlement does not arise until the liability of the defendant has been ascertained, Hordern-Richmond Limited v Duncan [1947] KB 545 at 552, although it is convenient to have all matters decided at the same time as provided for in the rules. These considerations militate against a construction of ss 9 and 36 of the PIPA contended for by the plaintiff.

[25] A perusal of the PIPA suggests an intention on the part of the legislature that no claim for damages is to be excluded from the regime set out in the Act unless it is covered by an analogous regime in either the WCRA or the Motor Accident Insurance Act 1994. The long title confirms this. It is "An Act to regulate particular claims for and awards of damages based on a liability for personal injuries...". The main purpose of the Act is to assist the ongoing affordability of insurance through appropriate and sustainable awards of damages for personal injury, s 4. This is to be achieved generally by providing a procedure for the speedy resolution of claims for damages for personal injury to which the Act applies, by promoting the settlement of claims at an early stage and by

"(c) ensuring that a person may not start a proceeding in a court based on a claim without being fully prepared for resolution of the claim by settlement or trial."

[26] Mr Grant-Taylor, however, contended that requiring the third parties to be given a written notice of the claim and for compliance with the processes in chapter 2 of the PIPA before being joined as defendants in the proceedings goes against the philosophy of the PIPA of speedy resolution of claims and of the UCPR enshrined in r 5 "to facilitate the just and expeditious resolution of the real issues in civil proceedings at a minimum of expense". This overlooks an important purpose of the legislation that no proceeding in a court is to be commenced without fully exploring settlement which is facilitated by the chapter 2 procedures. If the third parties are dilatory, s 35 permits an aggrieved party to seek the assistance of the court.

[27] Mr Grant-Taylor suggested that since the compulsory conference with the employer had already taken place it would be unlikely to want to be involved in another with the third parties and thus the purpose of the PIPA to bring about early resolution would be avoided. It is clear, however, that the employer can be compelled to participate. The third parties may join the employer as a "contributor" claiming indemnity or contribution pursuant to s 6(c) of the Law Reform Act 1995 (Qld). Such a claim is not for damages and is not excluded by s 6(2)(b), Bonser v Melnacis [2002] 1 Qd R 1. Neither would it be for damages within the meaning of s 10(1) of the WCRA.

[28] Section 16 of the PIPA provides for a respondent (third parties) who receives a complying part 1 notice of claim to add someone else (the employer) as a contributor by giving the person a written notice claiming indemnity from or contribution towards the respondent's liability. Such a contributor is required by

s 17 to respond to the contribution notice in much the same way as a respondent is required to respond to an original notice of claim pursuant to s 10 and is obliged by s 29 to give the respondent joining it copies of reports and other documentary material about the incident.

[29] Section 36 requires a conference of the parties before starting a proceeding in a court based on a claim. "Party" is defined in the dictionary as "claimant, respondent or contributor". Section 38(6) provides that each party must attend a compulsory conference and actively participate in an attempt to settle a claim. An offer to contribute may be taken into account on the question of costs even though not a respondent to a claim for contribution, s 41.

[30] Mr Grant-Taylor referred to difficulties that might arise for the plaintiff should the third parties proceed without all due expedition to pass through the processes provided for in the PIPA. These were adverted by their Honours Judge Boyce QC and Judge McGill SC in Legnoverde v Lenard's - Kenmore (2004) 24 Qld Lawyer 324 and Inglis v Connell and Suncorp Metway Insurance Limited [2003] QDC 29 respectively. The limitation period expires in early August 2004. Should any difficulty arise, the court, on application by the plaintiff, can give leave to join the third parties as defendants pursuant to s 43 of the PIPA, which provides for such an order where there is an urgent need to start a proceeding. Otherwise s 35, as mentioned above, provides for the court to make orders to remedy any default.

[31] The clear tenor of the PIPA is to make all persons in respect of whom damages for personal injury or contribution or indemnity are sought, not otherwise subject to the Motor Accident Insurance Act 1994 or the WCRA, amenable to its regime.

The contrary conclusion would lead to an unsatisfactory and fragmented result.

[32] In the event that the appeal is upheld Mr Grant-Taylor seeks an order pursuant to

s 15(1) of the Appeals Costs Funds Act 1973. In Lauchlan v Hartley [1980] Qd R 149 per Connolly J at 151, with whom Wanstall CJ and Lucas SPJ agreed, gave some guidance as to the type of situation in which a certificate may be granted. Subject to any particular circumstances, a certificate may be granted where the authorities are or appear to be in conflict; where the proper construction of a particular instrument calls for a nice balancing of competing considerations; or where the exercise of the judicial discretion turns upon the weight to be given to one or more of the relevant considerations.

[33] His Honour also identified a quite different category of case where the appellate court is of the view that there was no basis upon which the order under appeal could properly have been made. His Honour observed at 151 that in such a case it is material to consider the part played by the unsuccessful respondent in leading the tribunal to the decision. Where the respondent's lawyer invites a decision for which there is no legal warrant or which is inconsistent in some respect with settled legal principle, the question arises whether those contentions were fairly arguable.

If in the opinion of the appellate court the legal warrant was arguably available or the settled principle was arguably distinguishable the respondent may still succeed in obtaining a certificate. If not, then ordinarily, no certificate will be granted.

[34] The plaintiff's written submissions below contended that the PIPA did not apply to the plaintiff's injury because the plaintiff had sustained an injury as defined under the then WorkCover Queensland Act 1996 (Qld). Reliance was placed on the decision and observations of McGill DCJ in Inglis.

[35] After his Honour reserved his decision the parties were invited to make further written submissions regarding three issues, namely, whether the definition of "injury" in s 32 of the WCRA and in particular the words "a significant contributing factor to the injury" required the court to make a preliminary estimate of a contribution of each of the alleged tortfeasors to the plaintiff's injury; if "yes" what was meant by "significant" in the definition; and if the answer to the first question was "yes", could a court take a different view as to the applicability of the PIPA as a result of its determination of the facts after a trial. The plaintiff responded to his Honour's questions negatively for the first question but developed the arguments which were advanced on appeal, that the plaintiff was not seeking to start a proceeding in a court in terms of s 9 but was joining the third parties to an existing proceeding.

[36] In my view, counsel for the plaintiff did not ultimately lead the learned judge below to a decision for which there was no legal warrant. After all, he had the observations of a highly respected District Court Judge on matters of practice.

The position which the plaintiff took below and on appeal was fairly arguable.

I would grant a certificate pursuant to s 15(1) of the Appeal Costs Fund Act 1973 (Qld).

[37] The orders which I would make in each matter are

1. Grant leave to appeal pursuant to s 118 of the District Court of Queensland Act 1967 (Qld).

3. Set aside the orders made below and in lieu dismiss the application for leave to join the first and second third parties as defendants to the claim.

4. The respondent to the application and appeal to pay the applicant/appellant's costs of and incidental to the application and the appeal.

5. Grant the respondent an indemnity certificate in respect of the appeal pursuant to s 15(1) of the Appeal Costs Fund Act 1973 (Qld).

[38] DOUGLAS J: I have had the advantage of reading the draft reasons for judgment prepared by Williams JA and White J. I agree with each of their Honour's reasons and with the orders proposed by White J.