Talifero v Asbestos Injuries Compensation Fund Limited as Trustee for the Asbestos Injuries Compensation Fund

Court of Appeal (NSW)|2018-08-06|Before: Beazley P, Sackar J

Introduction

These proceedings are concerned with the true construction, in the context of the James Hardie Former Subsidiaries (Winding Up and Administration) Act 2005 (NSW) (the Act), of two separate instruments, as amended and restated, relating to the Asbestos Injuries Compensation Fund (the Fund). The two instruments are described as the Asbestos Injuries Compensation Fund Trust Deed (the Trust Deed), by which the Fund was established, and the Final Funding Agreement (the Agreement). The question in the proceedings arises in an application for the advice and direction of the Supreme Court under s 55 of the Act made by the Asbestos Injuries Compensation Fund Limited (the Trustee) in its capacity as trustee of the Fund.
A principal object of the Act is to ensure that liabilities of certain companies that were formerly within the James Hardie corporate group, in respect of personal injury or death of persons arising from exposure to any asbestos or asbestos products that were sold or used by those companies, will be dealt with in accordance with the Agreement. The intention is that preference will be given to those claims over other claims in a manner that recognises that exposure to such asbestos or asbestos products, or personal injury or death arising from such exposure, may occur for an extended period into the future.
The Trustee's application under s 55 of the Act related to a judgment obtained in the Dust Diseases Tribunal (the Tribunal) in proceedings brought by Mr Francis Talifero (Mr Talifero) against Amaca Pty Ltd (Amaca) seeking damages for injury suffered by Mr Talifero as a consequence of his exposure to asbestos products supplied by Amaca. Amaca is one of the companies formerly within the James Hardie corporate group to which the Act is intended to apply. The question is whether the Trustee would be justified in not paying so much of the damages awarded in favour of Mr Talifero in the proceedings in the Tribunal as reflects the extent to which Mr Talifero's exposure to asbestos or asbestos products occurred outside Australia. Before addressing the question raised in the appeal, it is necessary to say something about the Act, the Trust Deed and the Agreement.

The Act

Part 4 of the Act, which consists of ss 20 to 60 inclusive, relates to the winding up of liable entities. It is common ground that Amaca is a liable entity for the purposes of the Act, the Trust Deed and the Agreement. Section 21(1) of the Act relevantly provides that, during the winding up period for a liable entity, no proceedings may be brought or continued in a court or other tribunal for the winding up of the entity otherwise than in accordance with Pt 4. Under s 20, the winding up period is the period commencing on the day on which s 20 of the Act commenced and ending at the end of the day appointed by the Governor, or on which the liable entity is deregistered under the Corporations Act 2001 (Cth), whichever first occurs.
Under s 23(1) of the Act, the powers of a liable entity must be exercised during the winding up period so as to:

carry on the business of the liable entity so far as is necessary or convenient for the management of claims made against the liable entity to ensure that only payable liabilities of the liable entity are paid in accordance with the provisions of Pt 4;
pay such payable liabilities in accordance with the provisions of Pt 4; and
apply any funds provided from the Fund only in accordance with the conditions on which that funding is provided.

Section 32(1) relevantly provides that, during the winding up period for a liable entity, only payable liabilities of the liable entity may be paid. It is relevant that s 32 does not impose any obligation or liability on a liable entity. Rather, s 32 restricts the liabilities of a liable entity that may be paid.
The term payable liability is defined in the Act, relevantly, as a liability of the liable entity to pay a proven personal asbestos claim made against the liable entity in an Australian court or other Australian tribunal, but only to the extent that the exposure to asbestos or asbestos products to which the claim relates occurred wholly within the territorial limits of Australia. A personal asbestos claim is defined as including a claim for damages, in respect of personal injury or death arising from exposure to any asbestos or asbestos products that were sold by or on behalf of a liable entity, by the person who sustains the personal injury. A proven personal asbestos claim is defined as a personal asbestos claim against a liable entity in respect of which a final judgment has been entered by a court or other tribunal against the liable entity, or a binding settlement has been entered into by the liable entity, but only to the extent that the judgment or settlement gives rise to a liability of the liable entity.

The Trust Deed

Clause 5.10 of the Trust Deed relevantly provides that the Trustee must at all times comply fully with the obligations imposed on it by the Agreement. Further, cl 5.8(a) relevantly provides that the Trustee was to have no power to, and must not pay or discharge or purport to pay or discharge, any liability of a liable entity that the liable entity was not authorised to pay or discharge by the Agreement or the Act.
Clause 3 of Trust Deed relevantly provides that the charitable fund established under it is to exist and be maintained by the Trustee, and that the charitable fund property is to be maintained and applied by the Trustee for the principal purpose of receiving and providing funding for the payment and paying of Payable Liabilities and providing services with respect to the management and resolution of Payable Liabilities. The term Payable Liability is defined in the Trust Deed, relevantly, as a Proven Claim as defined in the Agreement.

The Agreement

Clause 4.2 of the Agreement relevantly provides that the Trustee's role is, subject to the provisions of the Act, to pay Proven Claims in respect of liable entities. However, a liable entity has no right to direct the Trustee as to the payment or manner of timing of any payment of such amounts, nor to have any rights to itself receive such amounts.
Under the Agreement, Proven Claim means any Personal Asbestos Claim in respect of which final judgment has been given against, or a binding settlement has been entered into by, a liable entity, to the extent to which that entity incurs liability under that judgment or settlement. Personal Asbestos Claim is defined, relevantly, as any present or future personal injury or death claim by an individual or the legal personal representative of an individual, for damages under common law or under other law that: (i) arises from exposure to asbestos occurring in Australia, provided that: (A) the individual's exposure to asbestos occurred wholly within Australia; or (B) where the individual has been exposed to asbestos both within and outside Australia, damages included in the Personal Asbestos Claim shall be limited to the amount attributable to the proportion of the exposure which caused or contributed to the loss or damage giving rise to the Personal Asbestos Claim which occurred in Australia; (ii) is made in proceedings in an Australian Court or Tribunal; and is made against any of the liable entities.

Mr Talifero's Claim

Mr Talifero was born in the United Kingdom in 1931 and had some exposure to asbestos during his employment in the United Kingdom first with the British Navy and then with a roofing company and a brick company. He came to Australia in 1971 where he worked for 25 years as a house painter. During that time, he had to replace broken asbestos cement sheets from time to time in order to complete house painting jobs. Mr Talifero was exposed to asbestos by way of new fibro sheets manufactured by Amaca and supplied to Kingsford Timber, where Mr Talifero bought the sheets. He subsequently contracted mesothelioma, a disease from which he subsequently died.
On 18 April 2017, Mr Talifero commenced proceedings against Amaca in the Tribunal. Mr Talifero's statement of claim alleged that, from 1971 to 1996, while working as a self-employed house painter, he handled asbestos cement building materials manufactured and supplied by Amaca, as a consequence of which, he was exposed to and inhaled asbestos dust and fibre and contracted mesothelioma. He claimed damages for the injury, loss and damage suffered by reason of his contracting mesothelioma. Following Mr Talifero's death, the proceedings in the Tribunal were continued by Mr Anthony Talifero (the Executor), who is the son and legal personal representative of Mr Talifero.
On 16 June 2017, Amaca's solicitors wrote to Mr Talifero's solicitors saying that the Trustee could not make a payment to Mr Talifero from the Fund for any exposure to asbestos outside Australia. The letter stated that, if Mr Talifero obtained judgment in the Tribunal, the Trustee would deduct a portion of the judgment attributable to the overseas exposure. On 19 June 2017, Mr Talifero's solicitors wrote to Amaca's solicitors asking whether Amaca and the Trustee had made an application under s 55 of the Act and, if not, whether it intended to make such an application. Amaca's solicitors told Mr Talifero's solicitors that the Trustee had not made an application because it did not consider such an application to be required.
The Trustee subsequently obtained a report by Professor Richard Fox dated 29 July 2017 (the Fox Report). The Fox Report described a model for the incidence of mesothelioma related to the fibre type, size, mix of asbestos, the intensity of exposure, the time since first exposure, and the year of exposure (the Peto Model). The Fox Report explained that the Peto Model predicts that risk of mesothelioma is increased after each increment of exposure to asbestos by an amount proportional to the level of exposure and the cube of time after that, and that incidence is much more dependent on early or low levels of exposure and increases less rapidly as exposure continues to increase, depending mainly on the time since first exposed.
The Fox Report was based on certain assumptions that do not appear to be in dispute. The assumptions were that Mr Talifero: * served in the British Navy in 1949 and 1950; * worked in the United Kingdom between 1951 and 1959 with a roofing company and from 1960 to 1961 with a brick company; and * after migrating to Australia, worked between 1971 and 1996 with a painting firm. The Fox Report noted that Mr Talifero estimated that his period with the British Navy represented 10% of his total exposure to asbestos dust and fibres, his period with the roofing company and the brick company were less than 1% of his exposure, and his Australian exposure represented 90% of his total exposure. The Fox Report assumed that Mr Talifero's estimates were based on total dust exposure on a concentration basis rather than being based on time.
For the purposes of the Fox Report, Mr Talifero's 1% exposure with the roofing and brick companies in the United Kingdom was ignored and exposure with the British Navy was taken to be the midpoint of the period, being 64.5 years prior to the development of his mesothelioma. That, when cubed, produced the numerical value of 268,336. By contrast, the Australian employment was over a period of 25 years during which, the Fox Report said, the asbestos exposure was "relatively light". The exposure in Australia was taken to be the midpoint of the period being 32 years prior to the development of mesothelioma. When cubed, that gave a numeric value of 32,768. The concentration of 10% with the British Navy gave a figure of 26,834 and the concentration of 90% in Australia gave a figure of 29,949. That, the Fox Report concluded, gave a non-Australian contribution of 48% and an Australian contribution of 52%.
On 22 November 2017, the Trustee's solicitors wrote to the Executor's solicitors saying that the Trustee was under a statutory duty to pay a claim only to the extent of asbestos exposure within Australia, even if an award of damages is made by a court or tribunal on the basis of a single indivisible injury. They said that, where a claimant has experienced overseas exposure to asbestos, the Trustee is prohibited from making a payment for the proportion resulting from overseas exposure. The letter confirmed that no payment would be made by the Trustee for any damages award with respect "to the relevant determined proportion of overseas asbestos exposure" and that if any damages award included both domestic and overseas exposure, the Trustee would make an appropriate adjustment to deduct the proportion relating to overseas exposure. The letter said that the Trustee would make an application under s 55 of the Act for judicial advice in that regard.
On 11 December 2017, for reasons published on that day, a judge of the Tribunal directed the entry of judgment for the Executor against Amaca in the sum of $560,482. The Tribunal found that Mr Talifero's exposure to the products manufactured and supplied by Amaca was sufficient to cause his mesothelioma and that he was therefore entitled to judgment against Amaca.
On 8 January 2018, Amaca's solicitors wrote to the Executor's solicitors saying that the Trustee had directed that a 48% deduction be applied to the award made by the Tribunal. By letter of 15 January 2018 to the Trustee's solicitors, the Executor's solicitors asserted that the Executor was entitled to the whole of the judgment sum awarded by the Tribunal. The Trustee's solicitors replied on 19 January 2018 saying, relevantly, that the Trustee had determined that, in giving effect to s 32 of the Act and the relevant provisions of the Agreement, only 52% of the award in the Tribunal was a "payable liability" of Amaca capable of being properly paid by the Trustee in accordance with the Act. That assertion was apparently based on the Fox Report. The Trustee's solicitors referred to their letter of 22 November 2017 as setting out the approach adopted by the Trustee.
On 23 January 2018, the Trustee's solicitors gave notice to the Attorney General under s 57 of the Act that the Trustee proposed to make an application under s 55 of the Act. Accordingly, by summons filed in the Equity Division on 23 January 2018, the Trustee sought an order pursuant to s 55 of the Act that it would be justified in not paying so much of the damages award made in proceedings brought in the Tribunal by Mr Talifero as reflects the extent to which Mr Talifero's exposure to asbestos or asbestos products occurred outside Australia.
On 4 May 2018, for reasons published on that day, a judge of the Equity Division (the primary judge) concluded that the Act, the Agreement and the Trust Deed obliged the Trustee only to pay those personal asbestos claims as limited to the amount attributable to the proportion of the exposure that caused or contributed to the loss or damage which occurred in Australia. The primary judge made an order in accordance with prayer 1 of the Trustee's summons of 29 January 2018. Although the proceedings before the primary judge were for advice and direction under s 55 of the Act, the Executor was given leave to intervene, as was the Attorney General. The primary judge ordered that the Trustee's costs of the proceedings on an indemnity basis and the Executor's costs on an indemnity basis be paid out of the Fund.
By Notice of Appeal filed on 1 June 2018, the Executor appeals from the orders made by the primary judge. Before addressing the question raised in the appeal, it is desirable to say something about the procedure involved in the Trustee's application.

The Procedure

Under s 55(1) of the Act, the Trustee may apply for advice or direction by the Supreme Court on any matter relating to:

the scope of the Trustee's functions under Pt 4 of the Act;
the exercise of any function by the Trustee under Pt 4 of the Act; or
any other matter relating to the operation of Pt 4 of the Act. Under s 55(10), no proceedings lie, or civil or other liability arises, against an applicant for or on account of any act, matter or thing done or omitted to be done by the applicant in good faith and in accordance with any approval, advice or direction given under this section.

On one view, the application under s 55 of the Act could be misconceived. Section 55 is concerned with advice or direction in relation to Pt 4 of the Act. The real question raised by the proceedings, however, concerns the true construction of the Agreement and the Trust Deed. It may be that the application could have been framed as an application under s 63 of the Trustee Act 1925 (NSW). Under s 63, a trustee may apply to the Supreme Court for an opinion advice or direction on any question respecting the management or administration of the trust property, or respecting the interpretation of the trust instrument. If the trustee acts in accordance with the opinion advice or direction, the trustee will be deemed, so far as regards the trustee's own responsibility, to have discharged the trustee's duty as trustee in the subject matter of the application, provided that the trustee has not been guilty of any fraud or wilful concealment or misrepresentation in obtaining the opinion advice or direction.
Since the Executor was not a party to the Trustee's summons, he may need leave to appeal. Clearly, he should have leave to the extent that it is necessary.

The Appeal

The ground specified in the Notice of Appeal is that the primary judge erred in failing to find that the whole of the claim made and upheld in Mr Talifero's proceedings in the Tribunal was a Proven Claim that the Trustee is obliged to pay under the Agreement. That question turns upon the language of the proviso contained in par (a)(i)(B) of the definition of Personal Asbestos Claim in the Agreement and the Trust Deed. The proviso calls for a factual inquiry on the part of the Trustee as to whether:

Mr Talifero's exposure to asbestos occurred wholly within Australia; or
Mr Talifero had been exposed to asbestos both within and outside Australia. If the latter is found to be the case, the damages that are to be included in Mr Talifero's claim must be limited to the amount attributable to the proportion of the exposure that occurred in Australia and that caused or contributed to Mr Talifero's mesothelioma.

The material before the Trustee demonstrates that Mr Talifero was exposed to asbestos or asbestos dust both within and outside Australia. It appears that the state of the science in relation to the contracting of mesothelioma is that mesothelioma can be caused by the inhalation of a single fibre of asbestos and that the onset of the disease might not occur until as many as 40 years after the inhalation. It is not presently possible to identify the precise time when the fibre that causes mesothelioma might have been inhaled. Thus, it is not possible to say whether the fibre inhaled by Mr Talifero that caused his mesothelioma was inhaled while working in Australia with products manufactured and supplied by Amaca, or was inhaled while, for example, on service with the British Navy outside Australia. Nevertheless, it is clear that Mr Talifero was exposed to asbestos both within and outside Australia.
It is possible that, while working with the British Navy, Mr Talifero inhaled a fibre of asbestos and that, while working on products manufactured or supplied by Amaca in Australia, he also inhaled a fibre of asbestos. That raises a significant question of causation. Each fibre may, on its own, have been causative of Mr Talifero's mesothelioma, quite independently of the other. That will now never be known.
The possibility that there may have been two independent causes of the disease does not appear to be reflected in the language of par (a)(i)(B) in so far as that provision calls for an inquiry as to the amount of damages included in the claim made by Mr Talifero that is "attributable to the proportion of the exposure" that caused or contributed to his loss and damage that occurred in Australia. That language is quite inapt to refer to the circumstances of a victim of mesothelioma.
It appears likely that the exposure to asbestos that actually caused Mr Talifero's mesothelioma occurred either wholly within Australia or wholly outside Australia, although it is not possible to say which. The provisions of the Trust Deed and the Agreement call for an inquiry by the Trustee as to whether Mr Talifero inhaled the fibre that actually caused his mesothelioma in Australia or outside Australia. It may be that Mr Talifero inhaled fibres both outside Australia and inside Australia. Nevertheless, the Trustee must make a decision as to whether it is more likely than not that Mr Talifero inhaled the fibre that caused his mesothelioma while in Australia. It may be that, before coming to Australia, Mr Talifero had inhaled a fibre that, ultimately would have caused mesothelioma and that, after he arrived in Australia, he inhaled another fibre that may, of itself alone, have caused his mesothelioma.
If Mr Talifero inhaled the fibre that caused his mesothelioma in Australia, he is entitled to the full amount of the award made by the Tribunal. On the other hand, if Mr Talifero inhaled the fibre that caused his mesothelioma before he came to Australia, he would not be entitled to any part of the award made by the Tribunal. That question, however, is not presently before this Court. However, the Fox Report appears to be a singularly inappropriate basis for determining whether it is more likely than not that the fibre that caused Mr Talifero's mesothelioma was inhaled inside or outside Australia.
It is interesting that considerations of policy similar to those raised in proceedings such as these led, as long ago as the 2nd Century, to a departure from what the law would usually require by way of proof of causation. In a situation such as the present, the Romans would have held both wrongdoers liable under the Lex Aquilia, which imposed liability on a person who caused the death of a slave iniuria, that is to say, without justification or wrongfully. Under Roman law, a slave was property and the owner was entitled to recover damages from a wrongdoer who wrongfully caused the death of a slave. Where a slave was mortally injured wrongfully by one wrongdoer and, subsequently, before death occurred, was killed wrongfully by another wrongdoer, the Roman solution, as explained by Julian, the greatest jurist of the reign of Hadrian in the first half of the 2nd Century, was to permit full recovery from both wrongdoers, [53] although the quantum of damages recoverable could differ because the value of the slave was significantly reduced by the first act. [54] That view was confirmed by Ulpian at the beginning of the 3rd Century on the basis that the Lex Aquilia was penal in its nature. [55] Of course, as Lord Rodger observed in 2002, Justinian's compilations in the Digest published AD 533 may not furnish much guidance on the formulation of an equivalent rule today. [56] On the other hand, the apportionment contemplated by the Act is not all that different from the solution of the Roman jurists.
As indicated above, the primary judge concluded that the Trustee would be justified in not paying so much of the damages award made by the Tribunal as reflects the extent to which Mr Talifero's exposure to asbestos or asbestos products occurred outside Australia. In so far as it appears to authorise paying a proportion between nil and 100% of the award of the Tribunal, that conclusion, is erroneous.
I would allow the appeal and set aside the orders made by the primary judge. Clearly, it would be desirable that the matters that have been fully argued should be resolved and should not be thwarted by procedural difficulties. However, I am not persuaded that this Court is in a position to decide the question. The Trustee should be advised that it would not be justified in paying the amount of damages specified in the summons.
After the proceedings in the Equity Division have been properly constituted, along the lines suggested by Sackville AJA, the Trustee should be given the opportunity of making a decision as to the amount that is to be paid to the Executor in respect of the award made by the Tribunal, in the light of the conclusions reached above. If the Executor were to be dissatisfied with any decision made by the Trustee, it would be open to him to take proceedings against the Trustee in respect of that decision.
Since that result was not contended for by any party, it would be appropriate to afford the parties the opportunity to make any further submissions they wish as to the costs at first instance and of the appeal.

Endnotes

Section 55 of the Winding Up Act is reproduced, so far as relevant, at [51] below.
Talifero v Amaca Pty Ltd [2017] NSWDDT 14 (Tribunal Judgment).
Tribunal Judgment at [9]. See [76]-[79] below for an explanation of the terms "indivisible" and "divisible".
Asbestos Injuries Compensation Fund Ltd as Trustee for the Asbestos Injuries Compensation Fund [2018] NSWSC 589 (Primary Judgment).
The date appears to be a mistake as the Amended and Restated Final Funding Agreement is dated 21 November 2006.
Section 55(2) permits an application for advice or direction to be made by the Minister but no such application has been made. Section 55 of the Winding Up Act is reproduced at [51] below.
Sections 23, 32 and 34 of the Winding Up Act are reproduced at [43], [46] and [47] below.
Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher & Barnet (as liquidators of Octaviar Administration Pty Ltd (In Liq) & Ors (2015) 89 NSWLR 110; [2015] NSWCA 85 (Fortress Credit) at [75] (Bathurst CJ, Beazley P, Macfarlan, Meagher and Barrett JJA agreeing).
Witness v Marsden (2000) 49 NSWLR 429; [2000] NSWCA 52 at [81]-[82] (Heydon JA, Mason P and Priestley JA agreeing); Fortress Credit at [77]-[82].
Primary Judgment at [3]-[10].
The Dust Diseases Tribunal Regulation 2013 (NSW), cl 24(1) provides that the plaintiff in proceedings in the Tribunal must file and serve a Statement of Particulars in the prescribed form. The form specifies that the plaintiff must include a detailed history of his or her exposure to asbestos, including all interstate and overseas exposure.
Tribunal Judgment at [21]; [64]; Primary Judgment at [13]-[17].
Primary Judgment at [18].
Primary Judgment at [18].
Professor Fox said that the "Peto hypothesis" was derived from the work of a prominent English epidemiologist. According to Professor Fox, Peto: "postulated a model for the incidence of mesothelioma where the incidence was related to the fibre, type, size, mix of asbestos, the intensity of exposure in fibre mix, the time in years since first exposure and the year of exposure". The Supreme Court of the United Kingdom referred to the work of Peto and Rake, published in 2009 by the Health and Safety Executive, on Occupational, Domestic and Environmental Risks in Britain as the "first representative study to quantify the relationship between mesothelioma and lifetime occupational and residential history": Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229; [2011] UKSC 10 at [18] (Lord Phillips PSC).
Jackson Report at [1.23], [1.38].
Jackson Report at [1.38].
NSW Legislative Assembly, Parliamentary Debates (Hansard), 1 December 2005 at 20549 (The Hon Bob Debus).
Ibid at 20551.
Ibid at 20552.
Winding Up Act, s 2(1); New South Wales, Government Gazette, No 30, 3 March 2006 (Proclamation under the James Hardie Former Subsidiaries (Winding up and Administration) Act 2005 (NSW)).
Winding Up Act, s 2(2).
Winding Up Act, s 2(1); New South Wales, Government Gazette, No 30, 8 February 2007 (Proclamation under the James Hardie Former Subsidiaries (Winding up and Administration) Act 2005 (NSW)).
See at [29] above.
See at [57] above.
[2011] NSWSC 97 at [76].
Primary Judgment at [72].
Primary Judgment at [134].
Primary Judgment at [129].
Primary Judgment at [130].
Primary Judgment at [131].
Primary Judgment at [132].
Primary Judgment at [141].
Primary Judgment at [145].
Primary Judgment at [148]-[152].
Primary Judgment at [141].
(2003) 59 NSWLR 14; [2003] NSWCA 331 at [196] quoting Stevenson v James Hardie & Co Pty Ltd (1997) 15 NSWCCR 568 at 575 (Judge O'Meally). In Alcan Gove Pty Ltd v Zabic (2015) 257 CLR 1; [2015] HCA 33, the High Court departed from the factual findings in Orica in view of different evidence, but cast no doubt on the explanation of "indivisible injury".
[2011] 2 AC 229; [2011] UKSC 10 at [14].
[2008] NSWDDT 8 at [17].
[2011] 2 AC 229; [2011] UKSC 10 at [19]. The "Annex" to Lord Phillips' judgment sets out extracts from the judgment of Longmore LJ in Bolton Metropolitan Borough Council v Municipal Mutual Insurance Ltd [2006] 1 WLR 1492 at [7]-[12] explaining in more detail the state of medical knowledge concerning the causes of mesothelioma.
As the Attorney-General's submissions suggest, it may be that cl 4.2(d) confers a power coupled with a duty: see Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379; [2012] HCA 36 at [116]; M Aronson, M Groves and G Weeks, Judicial Review of Administrative Action and Government Liability (6th ed 2017, Lawbook Co) at [13.110].
Primary Judgment at [136].
Primary Judgment at [150].
Primary Judgment at [138].
Winding Up Act, s 3(1)(b)(i).
Winding Up Act, s 3(1)(a).
(2004) 218 CLR 216; [2004] HCA 12 at [103].
It was suggested in argument that the words in the definition would have work to do where a claimant suffers from a divisible disease such as asbestosis. However, in the case of asbestosis each defendant responsible for a claimant's exposure to asbestos commits a separate tort and is liable only for the appropriate proportion of the claimant's loss or damage: Ross v Meggitt Overseas Ltd (1999) 18 NSWCCR 324 at [62].
Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; [1988] HCA 21 at 510 (Deane, Toohey and Gaudron JJ); Tomlinson v Ramsay Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28 at [20] (French CJ, Bell, Gageler and Keane JJ).
Primary Judgment at [136].
See at [18] above.
Section 63 of the Trustee Act relevantly provides as follows:

"(1) A trustee may apply to the Court for an opinion advice or direction on any question respecting the management or administration of the trust property, or respecting the interpretation of the trust instrument. … (10) Any person who claims that the person's rights as beneficiary will be prejudiced by the conveyance or distribution may within such time as may be prescribed by rules of court, or as may be fixed by the Court, apply to the Court for such order or directions as the circumstances may require, and during such time and while the application is pending, the trustee shall abstain from making the conveyance or distribution." 53. See Digest 9.2.51.pr. 54. See Digest 9.2.2.pr 55. See Digest 9.2.11.2. 56. See Fairchild v Glenhaven Funeral Services Ltd [2002] 3 All ER 305 at [160].

Amendments 11 October 2018 - [151] "invisible" amended to read "indivisible" 25 October 2018 - Typographical amendments to: Headnote, holding (i), [73], [79], [90], [107], [124] 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: 25 October 2018

Dust Diseases Tribunal Regulation 2013(NSW)

257 CLR 1; [2015] HCA 33 Asbestos Injuries Compensation Fund Ltd [2011] NSWSC 97 Asbestos Injuries Compensation Fund Limited as Trustee for the Asbestos Injuries Compensation Fund [2018] NSWSC 589 Bolton Metropolitan Borough Council v Municipal Mutual Insurance Ltd [2006] 1 WLR 1492 Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; [1988] HCA 21 Fairchild v Glenhaven Funeral Services Ltd [2002] 3 All ER 305 Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher & Barnet (as liquidators of Octaviar Administration Pty Ltd (In Liq) & Ors (2015) 89 NSWLR 110; [2015] NSWCA 85 Harradine v Cockatoo Dockyard [2008] NSWDDT 8 Kelly v The Queen (2004) 218 CLR 216; [2004] HCA 12 Orica Ltd v CGU Insurance Ltd (2003) 59 NSWLR 14; [2003] NSWCA 331 Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379; [2012] HCA 36 Ross v Meggitt Overseas Ltd (1999) 18 NSWCCR 324 Sienkiewicz v Greif (UK) Ltd [2011] 2 AC 229; [2011] UKSC 10 Stevenson v James Hardie & Co Pty Ltd (1997) 15 NSWCCR 568 Talifero v Amaca Pty Ltd [2017] NSWDDT 14 Tomlinson v Ramsay Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28 Witness v Marsden (2000) 49 NSWLR 429; [2000] NSWCA 52 Texts Cited: Health and Safety Executive, Occupational, Domestic and Environmental Mesothelioma Risks in Britain (2009) M Aronson, M Groves and G Weeks, Judicial Review of Administrative Action and Government Liability (6th ed 2017, Lawbook Co) Report of the Special Commission of Inquiry into the Medical Research and Compensation Foundation (September 2004) Category: Principal judgment Parties: Anthony David Talifero (Appellant) Asbestos Injuries Compensation Fund Limited as Trustee for the Asbestos Injuries Compensation Fund (Respondent) Attorney-General for the State of New South Wales (Intervening) Representation: Counsel: Mr B Walker SC / Mr S Robertson (Appellant) Mr IM Jackman SC / Ms BA Ng (Respondent) Mr MG Sexton SC SG / Ms ES Jones (Attorney-General, NSW)

Solicitors: Segelov Taylor Lawyers (Appellant) Baker McKenzie (Respondent) NSW Crown Solicitor's Office (Attorney-General, NSW) File Number(s): 2018/172078 Decision under appeal Court or tribunal: Supreme Court of New South Wales Jurisdiction: Equity Citation: [2018] NSWSC 589 Date of Decision: 04 May 2018 Before: Sackar J File Number(s): 2018/30145

[This headnote is not to be read as part of the judgment] Mr Francis John Talifero brought proceedings against Amaca Pty Ltd (Amaca) in the Dust Diseases Tribunal of New South Wales (Tribunal) for damages in negligence as a result of contracting mesothelioma through exposure to James Hardie asbestos cement products (Talifero Proceeding). Mr Talifero died of mesothelioma on 16 October 2017. On 11 December 2017, his Estate was awarded damages to the sum of $560,482. Although Mr Talifero was also exposed to asbestos during his employment in the United Kingdom, including through his employment as a stoker in the British Navy, the Tribunal held that this exposure was irrelevant as mesothelioma is an "indivisible" disease. On 29 January 2018, the respondent, Asbestos Injuries Compensation Fund Limited, made an application for judicial advice pursuant to s 55(1) of the James Hardie Former Subsidiaries (Winding up and Administration) Act 2005 (NSW) (Winding Up Act). The respondent sought an order that it would be "justified in not paying so much of the damages award made in the Talifero Proceedings as reflects the extent to which Mr Talifero's exposure to asbestos or asbestos products occurred outside Australia". On 4 May 2018, the primary judge made the order in the terms sought. The respondent's application for judicial advice did not join any other party, however, on 8 March 2018, the primary judge granted leave to Amaca and Allianz Australia Insurance Ltd to make submissions. The Attorney-General for New South Wales intervened in the proceedings pursuant to s 58 of the Winding Up Act. The appellant, the Executor of Mr Talifero's Estate, was not joined as a party to the application for judicial advice. The primary judge's decision depended on the construction of three inter-related instruments that comprised a scheme to compensate victims of asbestos-related diseases: the Winding Up Act, the Asbestos Injuries Compensation Fund Amended and Restated Deed dated 14 December 2006 (Trust Deed) and the Amended and Restated Final Funding Agreement dated 21 November 2006 (Final Funding Agreement). The issue on appeal was whether the primary judge erred in failing to find that the whole of the claim made in the Talifero Proceeding was a "Proven Claim" that the respondent was obliged to pay under the Final Funding Agreement and thus erred in giving the judicial advice proposed by the respondent. Leave to appeal was granted and the appeal was allowed. Sackville AJA (Beazley P agreeing) held: (i) A non-party requires leave to appeal from a judgment or order under s 101(1)(a) of the Supreme Court Act 1970 (NSW) and will have standing to seek leave if he or she is "aggrieved" or is "sufficiently interested" in the judgment or order: [19]. Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher & Barnet (as liquidators of Octaviar Administration Pty Ltd (In Liq) & Ors [2015] NSWCA 85, Witness v Marsden [2000] NSWCA 52, referred to. Sackville AJA (Beazley P and Emmett AJA agreeing) held: (ii) The appellant was "aggrieved" by the orders made by the primary judge and, in any event, clearly had a sufficient interest in challenging them. It was therefore appropriate to permit the appellant to apply for leave to appeal: [20], [159]. Sackville AJA (Beazley P agreeing) held: (iii) A claim falls within the definition of "payable liability" in the Winding Up Act in so far as it is a claim founded on exposure to asbestos in Australia. Mr Talifero's "claim" was that propounded in the Talifero Proceeding, which was wholly founded on his exposure to asbestos in Australia. The provisions of the Winding Up Act therefore authorised the respondent to pay the whole of the judgment debt to the appellant: [105] - [113]. Ross v Meggitt Overseas Ltd (1999) 18 NSWCCR 324, referred to. (iv) Proviso (B) to the definition of "Personal Asbestos Claim" in the Final Funding Agreement (to which the definition of "Proven Claim" refers) is not to be construed as a direction to the court or Tribunal which determines the claim for damages. Such a claim must be determined in accordance with the common law and any legislation modifying the common law: [123]. Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502; [1988] HCA 21; Tomlinson v Ramsay Food Processing Pty Ltd (2015) 256 CLR 507; [2015] HCA 28, referred to. (v) The better construction of the proviso to the definition of "Personal Asbestos Claim", as applied to cl 4.2(d) of the Final Funding Agreement, is that each element refers to the claimant's exposure to asbestos alleged in his or her claim for personal injury damages and not to the claimant's actual exposure to asbestos: [124]. (vi) Accordingly, as Mr Talifero's claim in the Tribunal was a claim for damages arising solely from exposure to asbestos in Australia, it satisfied the definition of "Proven Claim" as set out in the Final Funding Agreement, notwithstanding his actual exposure to asbestos in the United Kingdom. The respondent was therefore obligated to pay the entire judgment debt pursuant to cl 4.2(d): [121] - [127]. Emmett AJA held: (vii) The provisions of the Trust Deed and Final Funding Agreement call for an inquiry by the respondent as to whether Mr Talifero inhaled the fibre that caused his mesothelioma in Australia or outside Australia. If Mr Talifero inhaled the fibre that caused his mesothelioma in Australia, he is entitled to the full amount of the award made by the Tribunal. On the other hand, if Mr Talifero inhaled the fibre that caused his mesothelioma before he came to Australia, he would not be entitled to any part of the award made by the Tribunal: [164] - [165]. (viii) The primary judge erred in concluding that the respondent would be justified in not paying so much of the damages award made by the Tribunal as reflects the extent to which Mr Talifero's exposure to asbestos or asbestos products occurred outside Australia, in so far as it would involve paying a proportion between nil and 100% of the Tribunal's award: [167].

(1999) 18 NSWCCR 324

(1997) 15 NSWCCR 568

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