I will deal with these matters in turn.
19 A. The judgment of Gummow J in Street's case already referred to is ample authority that the two co-ordinate liabilities need not flow from the one cause of action. It is also clear that there is no problem if the situation be that one liability arises from statute and the other from contract; see the BP Petroleum case supra and Armstrong v Commissioner of Stamp Duties (1967) 69 SR (NSW) 38; Spika Trading Pty Ltd v Harrison (1990) 10 NSWLR 211; Hanave Pty Ltd v Lfot Pty Ltd (1999) 168 ALR 318.
20 Why, it might be asked, are liabilities in tort excluded from the general principles of contribution? First it might be noted that in Street's case Gummow J seemed deliberately to decline to enter into the matter merely saying that the question was confused.
21 I have referred to Merryweather v Nixan. The reasoning of Lord Kenyon LCJ in that case is sparse, but as I indicated earlier, it is thought that the reasoning stemmed from the view that one cannot have an action for contribution arising out of one's own wrong. It is clear that by 1926, the rule in Merryweather v Nixan had solidified into a rule that if a person was found liable for a tort that person could not sue for contribution; see Dall v The Blue Wren Taxi Co Pty Ltd [1926] VLR 365.
22 However, 19th century cases tended to take the rationale of Merryweather v Nixan at face value. In Adamson v Jarvis (1827) 4 Bing 66; 130 ER 693, the plaintiff, an auctioneer, had been found guilty of conversion because the defendant had deceived him as to the ownership of the goods. The Court of Common Pleas held that the rule in Merryweather v Nixan only applied where "The person seeking redress must be presumed to have known that he was doing an unlawful act" (Bing 73; ER 696).
23 This case was applied by the Full Court of the Supreme Court of NSW in Davenport v Commissioner for Railways (1953) 53 SR 552, see especially per Owen J at page 555. The Court considered (of course after the 1946 Act) that the rule in Merryweather v Nixan was confined to cases where there was fraud or other wilful wrongdoing, but in any event was excluded from a case where a master was sued in tort vicariously for the acts of the servant. The interesting thing is that the master was liable in tort and the servant was liable to contribute by virtue of a contract. However, it would seem that as the Full Court was dealing with a District Court appeal, it was granting the master indemnity under a contract rather than under the equitable doctrine of contribution.
24 The Merryweather v Nixan principle was also reviewed in The Englishman and The Australia [1895] P 212. At 217 Bruce J came to the view that situations such as that which existed in Adamson v Jarvis were cases where a person who had committed a tort but without doing anything illegal was entitled to recover on an implied indemnity. The principle was not one of contribution but rather of contract. He held at 218 that the rationale of Merryweather v Nixan was that there was no implied indemnity between joint tortfeasors.
25 Thus we have the situation where, despite the rule in Merryweather v Nixan it was possible for a tortfeasor at common law to sue on an implied contract for indemnity either against a servant for whose act he was vicariously liable, or for a person who really caused the loss.
26 It should be noted that many cases of the class where A, who is liable in tort wishes to sue B, who is liable in contract for the same damage, have been able to be dealt with under the Law Reform (Miscellaneous Provisions) Act 1946 because the courts have assumed that even if the person from whom contribution is sought was sued in contract, if that person could have been sued in tort then that person is a joint tortfeasor within the meaning of the statute; see eg McConnell v Lynch-Robinson [1957] NI 70 and Jones v Mortgage Acceptance Nominees Ltd (1996) 63 FCR 418, 420. It is to be noted that Davies J said at 422 that if this were not so "…there is no cogent reason why equity should not aid the identification of the tortfeasors who ought to contribute and the ascertainment of what would be a just contribution. That is precisely what equity did when, because of problems arising from procedural rules and the non-joinder of parties in common law actions, an appropriate order as to contribution could not be made by a common law court…". His Honour referred to Spence, Equitable Jurisdiction of the Court of Chancery (Stevens, London, 1846) Vol 1 page 663.
27 Before turning to the position in equity I should note that in Palmer v Wick & Pulteneytown Steam Shipping Co Ltd [1894] AC 318, Lord Hershell LC in the Scots Appeal at page 324 held that the rule in Merryweather v Nixan did not apply in Scotland and accordingly had no reason to refuse contribution between tortfeasors under the general law. It is only a short step to argue from such reasoning that now Merryweather v Nixan has virtually been suppressed by the Law Reform (Miscellaneous Provisions) Act 1946, the same result should apply in NSW. I say "NSW" because both in Victoria and in England legislation has been adopted which very much simplifies the whole problem of contribution.
28 The history of contribution in equity is well set out in Spence op cit, Vol 1, pages 661 and following and see Dering v Winchelsea (Earl) (1787) 1 Cox Eq 318; 29 ER 1184 and Wolmerhausen v Gullick [1893] 2 Ch 514 at 519 and following. There is a digest of the early cases in 1 Equity Cases Abridgment 113; 21 ER 921. None of the cases in that list concern a situation where one of the persons claiming contribution was guilty of a tort.
29 The only case that appears in that category is Philips v Biggs (1659) Hardres 164; 145 ER 433, where the Court of Exchequer seemed to consider that a case of contribution between two sheriffs who had been jointly responsible for an escape was like a case between joint obligors. However, as the reporter says, he is not too sure what actually was the result of the case.
30 All this adds up in my mind to the proposition that after the Law Reform (Miscellaneous Provisions) Act 1946, there is no reason why there cannot be co-ordinate liabilities between people if one person's liability lies in tort and the other person's lies in contract, any more than it matters that the liabilities may have come from two separate and distinct contracts or one from a statute and one from a contract. Indeed, the only reason for not adopting the proposition is that there is no precedent for it and the only case resembling a precedent, the Tennessee decision to which I have already referred, goes the other way.
31 However, it seems to me that after 1946 and in the light of the comments that Davies J made in Jones v Mortgage Acceptance Nominees (supra) the proposition should be adopted.
32 Accordingly, I hold that it does not affect the situation as to whether there are co-ordinate liabilities that one such liability arose from a cause of action in tort and the other from a cause of action in contract.
33 Thus the appeal should be dismissed as the learned Master was correct to find that the respondent was entitled to succeed on the traditional principles of contribution set out in the Albion Insurance case. I have also indicated that if these were insufficient, equity in the year 2000 should go further and extend the principles to cover this case.
34 B. If the proposition in A is right, then there is no real need to consider question B, however I will shortly do so in deference to counsel.
35 There is no support in other decided cases for the approach taken by Lee J in Trade Practices Commission v Manfal (supra). However, the fact that a cause of action merges in a judgment and that that fact may have some relevance to the law of contribution has been a proposition accepted for centuries; see eg Blois v Blois (1680) 2 Vent 347, 348; 86 ER 478, 479.
36 In my view I should follow what Lee J held in Manfal's case so that even if I were wrong under section A, there would be co-ordinate liabilities under the judgment of the Court of Appeal.
37 Once it is clear that one can ignore the fact that the judgments originated respectively in tort and contract, the judgments in this case must be co-ordinate liabilities. What was said by Kitto J in the Albion Insurance case and by Gummow J in Street's case all point in that direction.
38 A complication that was raised in argument is that the plaintiff's statement of claim says that after judgment it entered into an agreement with Fightvision and paid Fightvision a smaller sum in full discharge of the judgment. The statement of claim says:
"10. On 13 December 1999 Sky Channel paid to Fightvision the sum of $7,750,000.00 to [sic] in full satisfaction of Sky Channel's liability to Fightvision pursuant to the Court of Appeal judgment.
11. The payment made by Sky Channel to Fightvision has partially discharged the Defendant's liability to Fightvision pursuant to the Court of Appeal judgment.
12. The Defendant remains liable to Fightvision for the sum of $767,269.20."
39 The defendant's answer to paragraph 10 was that he had no knowledge of any payment and any such payment was made without his knowledge or consent but he admitted paragraphs 11 and 12.
40 This state of affairs makes it virtually impossible to work out whether the judgment against the plaintiff has "drowned" in an accord and satisfaction. If there had been an accord and satisfaction of the judgment debt then it may well be that the liability of the defendant under the judgment has been released, but, if so, the fact posited in paragraph 12 of the statement of claim and admitted in the statement of defence could not be correct. On the other hand the word "satisfaction" is used in paragraph 10 whereas if the remaining facts in the statement of claim are true, the agreement between the plaintiff and Fightvision could have been no more than an agreement not to enforce the judgment (see in general Re EWA (A Debtor) [1901] 2 KB 642 and Dorgal Holdings Pty Ltd v Buckley (1996) 22 ACSR 164).
41 I just do not have enough material to find that the plaintiff's obligation under the judgment has been discharged by an accord and satisfaction.
42 The point is also relevant as to whether the amount of the judgment to which the plaintiff is entitled in this case is as the Master held $3,875,000 being half the amount actually paid by the plaintiff, or whether it should be some lesser amount to take into account the admitted fact that the defendant remains liable to Fightvision for $767,269.20, so that one should take half this latter amount away from the former. The position is complicated by the facts that (a) there is no appeal from the Master on the question of quantum; and (b) it would appear that in bankruptcy proceedings between the defendant and Fightvision, the defendant has, despite his admission in this case, argued that there is no debt at all now owed by him to Fightvision.
43 It seems to me that the lack of information I have in the case and the non-inclusion of any ground going to quantum means that I should do nothing other than order that the orders I make on this appeal not be taken out for 14 days after delivery of judgment.
44 C. Mr Aldridge SC argued that it was only a coincidence that the amount of damages awarded against the plaintiff and the defendant in Fightvision's proceedings was identical. Mr Wood says that whilst that may be the case in some actions, it was not in this particular action and it was inevitable that the amount of damages were the same. I agree with Mr Wood's submissions.
45 However, even if Mr Aldridge SC's submissions were correct on this matter, it would not affect the question of contribution except as to quantum; see Ellesmere Brewery Co v Cooper [1896] 1 QB 75; Windsor SC v Enoggera Divisional Board [1902] St R Qd 23.
46 D. As I have indicated above, Mr Wood also put his case on unjust enrichment. I have held that the appeal must be dismissed on principles of contribution. This means there is no need to deal with the arguments on unjust enrichment. However, I should briefly consider the submissions.
47 Mr Wood is correct in his submission that the leading books on restitution do include contribution as an instance of unjust enrichment and deal with it in their writings accordingly. However, in England the matter is really now a question of statutory rights. In Australia apart from Victoria which has adopted a statute, there has not been any support as yet for moving contribution from the category of equitable remedies where it has laid for the last 200 years into some new category. Moreover, the equitable defences that can be mounted to the claim (see eg Staples v Baker [1999] 1 Qd R 317, 327-8) mean that it belongs there. Apart from taking into account unjust enrichment as a factor as to why an order should be made, it does not seem to me that there is much to be gained by exploring restitution in this area as some sort of separate right.
48 E. Mr Aldridge SC said that this application for summary judgment was made prematurely. He says that at the final trial more facts would come to light which could have a bearing on the outcome.
49 Mr Wood submits that on the pleadings the questions are quite clear and that with the material facts that have been admitted, the case is a perfect one for summary judgment.
50 Apart from the issue of quantum to which I have referred and which is not the subject of any appeal, I cannot see any way in which the facts proved at the hearing could advance the parties' position one way or another. Accordingly, I find that it was proper for the Court to dispose of the application by summary judgment.
51 The upshot is that the appeal must be dismissed with costs. However, for the reasons I have given earlier I direct that this order not be formally entered for 14 days.
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