Tatterson v. Wirtanen (as Executrix of the estate of Desmond Barry Wirtanen) [1998] VSC 88 (29 September 1998)

Supreme Court of Victoria|1998-09-30|Before: Gillard, J.

Judith Irene Tatterson and Anor v. Valry Mavis Wirtanen (as Executrix of the estate of Desmond Barry Wirtanen).

Declaratory relief - Future possible cause of action - Jurisdiction to grant - Joinder of defendant - Rule 9.06(b)(ii)

For the proposed added Defendant, Rural and General Insurance Limited

The return of two summons in two separate proceedings which I heard together, seeking an order in each proceeding joining an insurance company as an additional defendant pursuant to Rule 9.06(b) of the Rules of Court.

The plaintiff in the first proceeding, Judith Irene Tatterson, is the widow of Ian James Tatterson and the mother of three children.

The plaintiff in the second proceeding, Janice Dorothy Saddington, is the widow of Kenneth Graham Saddington and the mother of three children.

The defendant in each proceeding is Valry Mavis Wirtanen who is sued as executrix of the estate of Desmond Barry Wirtanen deceased. The deceased died on 12 June 1992.

The proposed added defendant is Rural and General Insurance Limited, a company that carries on the business of insurance ("the insurance company").

The basic facts which led to the writs being issued in each proceeding and the present applications being made, can be briefly stated.

On 12 June 1992 an aircraft piloted by the deceased crashed near Moormbool in the State of Victoria ("the incident"). There were four passengers in the aircraft. The pilot and the passengers died.

Two of the passengers were Ian James Tatterson and Kenneth Graham Saddington.

On 23 August 1996 their widows each instituted in this court a proceeding by writ.

The cause of action is a statutory negligence claim brought by the plaintiffs as widows of the two passengers pursuant to the Wrongs Act 1958 and the proceedings are brought for the benefit of the dependants of each of the deceased passengers.

A firm of solicitors, Messrs Puglisi Heffey and Pavlidis, filed an appearance on behalf of the defendant in each case and delivered the same defence in each case.

Each defence could be described as a "bare bones" defence, namely, that the only matters put in issue were formal ones a denial of negligence and damages. No other defence has been taken.

Another passenger in the aircraft was married to Susan Jane Grostate and she instituted proceedings in this court against the same defendant in proceeding No . 6794 of 1996.

The proposed defendant insurance company consented to being joined as a second defendant in those proceedings on 17 December 1997 on the basis that it may be liable to the plaintiff pursuant to s.51 of the Insurance Contracts Act 1984 ("the Act"). The added defendant will no doubt exercise its right as a party in that proceeding to appear at the trial.

The plaintiff in each of the two proceedings has issued a summons seeking an order pursuant to Rule 9.06(b) of the General Rules of Procedure in Civil Proceedings 1986, that Rural and General Insurance Limited be joined "as a defendant to the proceeding out of time".

The reference to being "out of time" comes about by reason of the fact that the six year limitation period for contract and tort claims under the Limitation of Actions Act 1958 in this State expired on 12 June 1998 in respect of the incident. Whether the Act applies is a moot point.

However, because of the way the matter was argued before the court, it is unnecessary to consider the application of the Limitation of Actions Act.

A proposed amended statement of claim in each proceeding was filed with the court and in anticipation of the joinder seeks damages against the proposed second defendant. The pleaded basis for the claim is that the insurance company issued a policy indemnifying the owner and the pilot of the plane that crashed and the bald assertion that the estate as first defendant is indemnified by the policy. The proposed amended statement of claim is inadequate and does not disclose a cause of action. After some discussion, Mr Curtain, Q.C. who appeared for the plaintiff in each application, stated that the plaintiff would be proceeding against the proposed added defendant pursuant to s.51 of the Act and would be seeking a declaration.

The proposed declaratory relief was expressed as follows -

"A declaration that the plaintiff is entitled to recover pursuant to s.51 of the Insurance Contracts Act 1984 from Rural and General Insurance Limited an amount equal to the defendant's liability in damages to the plaintiff."

It was agreed between counsel for the plaintiff and the insurance company that the application to join the proposed defendant was to proceed on the assumption that relief was sought against the insurance company pursuant to s.51 of the Act and that the form of relief sought at this stage was declaratory.

In addition to the facts already stated, three further facts are established. First, that the estate of Desmond Barry Wirtanen does not have any assets to meet any judgment that may be entered and the only assets available to the plaintiff in each proceeding would be the fruits of the insurance policy issued by the insurance company assuming it indemnifies the deceased pilot.

Secondly, that it is a near certainty the estate would not contest the issues at the trial of each proceeding.

It is most likely that the two proceedings together with the Grostate proceeding will be heard by the same judge either together or following one another. The mode of trial is by judge along.

Finally, the insurance company is not at this stage defending the proceeding on behalf of the estate. Indeed, the evidence is that no demand has been made to do so. Be that as it may, it has had notice of the three proceedings now for periods in excess of 15 months, it has consented to be joined in the Grostate proceeding and has not sought to take over the case on behalf of the defendant estate in that proceeding.

"9.06 Addition, removal, substitution of party

At any stage of a proceeding the Court may order that -

(a) any person who is not a proper or necessary party, whether or not he was one originally, cease to be a party;

(b) any of the following persons be added as a party, namely

(i) a person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all questions in the proceeding are effectually and completely determined and adjudicated upon; or

(ii) a person between whom and any party to the proceeding there may exist a question arising out of or relating to or connected with any claim in the proceeding which it is just and convenient to determine as between that person and that party as well as between the parties to the proceeding;

Mr. Curtain Q.C. said that the plaintiffs relied upon paragraph (b)(ii).

There is a substantial difference between paragraph (b)(i) and sub-paragraph (ii). The first part of the paragraph is limited in its application. An applicant has to establish the additional party ought to have been joined as a party or whose presence is necessary to ensure that all questions are effectually and completely determined and adjudicated upon. The limitations on its application were discussed and recognised by the House of Lords in Vandevell's Trustees Ltd. v. White [1971] A.C. 912.

To overcome these limitations rule 9.06(b)(ii) was introduced into this State in 1986. It followed a similar rule in England which was introduced after Vandevell's case. See order 15 r.6(2)(b)(ii) of the English Rules.

In my opinion the scope of the rule has been substantially broadened by the addition of paragraph (b)(ii).

An applicant who seeks to invoke the Court's jurisdiction pursuant to rule 9.06(b)(ii) has to establish the following:

(i) that there are two entities namely the person to be added as a party and a party to the proceedings;

(ii) between the two entities there may exist a question arising out of or relating to or connected with any claim in the proceeding;

(iii) it is just and convenient to determine that question between the proposed party and the other party as well as between the parties to the proceeding.

Even if the applicant establishes those matters the Court still has a discretion whether or not to make the order.

In each proceeding it is the plaintiff who desires to join the insurance company as a defendant.

The first question which has to be considered is what cause of action, if any, does the plaintiff have against the proposed defendant. As a general rule it would be an abuse of process of the Court to permit a plaintiff to bring a proceeding against a defendant where there was no cause of action.

The plaintiff in each proceeding asserts that she has a right to recover damages against the insurance company by reason of s.51 of the Act.

Section 51 of the Act provides -

"Right of third party to recover against insurer

(a) the insured under a contract of liability insurance is liable in damages to a person (in this section called the 'third party');

(b) the insured has died or cannot, after reasonable enquiry, be found; and

the third party may recover from the insurer an amount equal to the insurer's liability under the contract in respect of the insured's liability in damages.

(2) A payment under sub-section (1) is a discharge, to the extent of the payment, in respect of -

(a) the insurer's liability under the contract; and

(b) the liability of the insured or of his legal personal representative to the third party.

(3) This section does not affect any right that the third party has in respect of the insured's liability, being a right under some other law of the Commonwealth or under a law of a State or Territory."

The question that arises is at what point in time does the cause of action accrue to the third party i.e. the plaintiff in each of the present proceedings within the meaning of s.51 of the Act?

Counsel for the plaintiff and the proposed defendant both submitted that the cause of action did not accrue until liability was established in the insured. This liability would arise either by reason of a judgment or a compromise.

For the purposes of the two applications before the Court I am prepared to assume that the submissions are correct. However, it should not be taken that I accept that the submissions are correct.

It follows that neither plaintiff has a present cause of action against the insurance company and in accordance with the general rule it would be an abuse of process to permit the joinder where there is no cause of action.

In order to avoid the operation of the prima facie rule, Mr. Curtain Q.C. submitted that a plaintiff can claim declaratory relief even though there is no cause of action between the plaintiff and the defendant.

He referred me to the Full Court decision in South Australia of J.N. Taylor Holdings Ltd. (In Liquidation) & Anor. v. Alan Bond & Ors. (1993) 61 S.A.S.R. 432.

In that case the plaintiff companies sued three of their former directors alleging breaches of duty as directors. Each director had a policy of insurance indemnifying him. One of the directors was bankrupt and the other two had left the country. In the case of the bankrupt defendant the trustee assigned to the plaintiff companies the defendant's right to indemnity under the policy subject to the consent of the insurer.

The liquidator of the plaintiff companies wrote to the insurer enquiring whether the insurer accepted liability to indemnify the directors in respect of the claims. The insurer replied denying any liability.

The plaintiffs sought leave to join the insurer as an additional defendant seeking a declaration that the insurer was obliged to indemnify the directors in respect of any judgment in favour of the plaintiffs. The judge at first instance refused the application.

The plaintiffs conceded that they did not have a cause of action against the insurance company.

On appeal the Full Court held that the Court had jurisdiction to grant declaratory relief, even though the plaintiff did not have a cause of action against the defendant.

The basis of the right of the plaintiff to seek a remedy arose by way of declaration under s.117 of the Bankruptcy Act 1966. This provided that the right of a bankrupt to indemnity under a policy, vested in the trustee and any amount received by the trustee from the insurer shall, if the liability had not already been satisfied, be paid in full to a third party to whom liability had been incurred.

The declaration sought by the plaintiffs was in the following terms -

"A declaration that AHA (the insurer) is obliged to indemnify the second and third defendants and Ramsay for any loss within the meaning of definition clause 5 of the policy sustained by the directors in consequence of judgment being entered against the directors in these proceedings."

Under s.117 of the Bankruptcy Act 1966, the plaintiff who recovers judgment against the bankrupt never has a cause of action against the insurance company under that provision. This is to be contrasted with s.51 of the Insurance Contracts Act 1974 which at some point in time provides a cause of action for a successful plaintiff against an insurer who has insured the unsuccessful defendant.

The Full Court discussed the principles concerning jurisdiction to grant declaratory relief even though there is no cause of action pleaded between the plaintiff and the defendant against whom declaratory relief is sought.

Having determined that the court's jurisdiction is unlimited with respect to the granting of declaratory relief which is only subject to a discretionary based refusal, the court went on to hold that the plaintiff's prospects of having a judgment satisfied against the defendants were "slight" and their only prospect of obtaining satisfaction rested on s.117 of the Bankruptcy Act. The court held that the plaintiffs could obtain satisfaction pursuant to the section even though there may be a number of obstacles to surmount, the first being whether the insurer was obliged to indemnify the defendant directors. That very question was raised by the declaration sought and it followed that the plaintiffs had the necessary interest in a claim for declaratory relief. The Full Court went on to hold that under the Rules of Court it was an appropriate case for the joinder of the insurer in the proceeding as a defendant.

The Court of Appeal in this State also discussed the principles in a similar type of case in C.E. Heath v. Pyramid Building Society (1997) 2 V.R. 256. The court distinguished the J.N. Taylor Holdings case.

In that case a building society commenced proceedings against its former auditors for breaches of retainer and duty of care. The trial was expected to be lengthy and expensive. The auditors' insurers were conducting the defence. An insurance question arose as to whether the insurer's liability was fixed in respect of any one claim. The building society sought confirmation from the insurers that they would indemnify the auditors and that the various claims should be treated as separate claims in respect of the limits in the policies. The insurers neither admitted nor denied liability to indemnify and declined to commit themselves on the interpretation of the policies. The building society applied for leave to join the insurers as defendants to the action and sought to amend its statement of claim to seek declarations against the insurers as to the operation of the policies of insurance. The basis for the declaratory relief was also under s.117 of the Bankruptcy Act. The judge at first instance granted leave for the joinder and amendment of the statement of claim.

The Court of Appeal allowed the appeal on the basis that it was not just and convenient within Rules 9.06(b)(ii) to join the insurers. A very important factor in that case was that the insurers were already conducting the case on behalf of the named defendants and if they were joined separately it deprived them of the right to conduct the defence. The court also held that the questions sought to be answered by the declaration were, in the circumstances, hypothetical and did not raise a real controversy between the parties. It followed that the claim for declaratory relief should be refused.

The court considered the limits to the court's jurisdiction to grant declarations in additions to the limits imposed by statute.

The court referred to what the High Court said in Ainsworth v. Criminal Justice Commission [1992] HCA 10; (1992) 175 C.L.R. 564 at 581-2 per Mason, CJ, Dawson, Toohey and Gaudron, JJ -

"It is now accepted that superior courts have inherent power to grant declaratory relief. It is a discretionary power which '[i]t is neither possible nor desirable to fetter ... by laying down rules as to the manner of its exercise'. [Forster v. Jododex at 437]. However, it is confined by the considerations which mark out the boundaries of judicial power. Hence, declaratory relief must be directed to the determination of legal controversies and not to answering abstract or hypothetical questions [In Re Judiciary and Navigation Acts [1921] HCA 20; (1921) 29 C.L.R. 257]. The person seeking relief must have 'a real interest' [Forster v. Jododex at 437; Russian Commercial and Industrial Bank v. British Bank for Foreign Trade, Ltd. [1921] 2 A.C. 438 at 448] and relief will not be granted if the question 'is purely hypothetical', if relief is 'claimed in relation to circumstances that [have] not occurred and might never happen' [University of New South Wales v. Moorhouse [1975] HCA 26; (1975) 133 C.L.R. 1 at 10] or if 'the Court's declaration will produce no foreseeable consequences for the parties' [Gardner v. Dairy Industry Authority (N.S.W.) (1977) 52 A.L.J.R. 180 at 188, 189]. (Emphasis added.)"

In the same case Brennan, J made similar observations and quoted two Privy Council cases at p.596 -

"The making of a declaration and the terms in which, if made, it should be framed are in the court's discretion. As the Privy Council said in Ibeneweka v. Egbuna :

'After all, it is doubtful if there is more of principle involved than

the undoubted truth that the power to grant a declaration

should be exercised with a proper sense of responsibility and a

full realization that judicial pronouncements ought not to be

issued unless there are circumstances that call for their making.

Beyond that there is no legal restriction on the award of a

declaration.' The circumstances that call for the making of a declaration are not present if there be no real controversy to be determined_)._ The characteristics of a controversy fit for determination by judicial declaration were stated by Viscount Dunedin in Russian Commercial and Industrial Bank v. British Bankfor Foreign Trade Ltd.:

'The question must be a real and not a theoretical question; the

person raising it must have a real interest to raise it; he must be

able to secure a proper contradictor, that is to say, some one

presently existing who has a true interest to oppose the

declaration sought.'"

In C.E. Heath v. Pyramid Building Society supra, at p.262, Ormiston, JA did not accept the view expressed by King, CJ in the J.N. Taylor Holdings case supra, that the jurisdiction was unlimited. His Honour went on to say -

"The 'boundaries of judicial power' do place a sensible limit on what the courts may be asked to declare. It is perhaps of no great consequence whether certain aspects of the tests as to what is theoretical or hypothetical may lead to a denial of jurisdiction or whether they go only to a discretionary ground to refuse relief. If there is no real 'legal controversy' then the courts will not embark upon a hearing which will certainly lead to a refusal of declaratory relief or any other relief. If it is a controversy which is not 'fit for determination by judicial declaration' then I see no reason why the litigation should not be immediately resolved."

"But there must be a true legal controversy defining the rights of two or more parties, and there must be an appropriate plaintiff and appropriate defendant to enable a justiciable issue to be resolved."

In my opinion, the elements necessary to establish a claim for declaratory relief are present here. The case does not involve a mere hypothetical question. There is a controversy between the parties which will define the rights of the two parties to the present proceeding and the insurance company. In my opinion, the plaintiff is an appropriate party having a clear interest in the outcome and the insurance company is an appropriate defendant having an interest in the issue to be resolved.

The uncontradicted evidence is that the estate has no assets. Hence, each plaintiff will be looking to the insurance company pursuant to s.51 of the Act. Once liability is established then the plaintiff is entitled to bring the proceeding pursuant to s.51.

Whether or not each plaintiff will succeed in her claim against the insurance company depends, inter alia, upon proof of the contract of insurance providing cover in respect of the pilot's liability arising out of the incident and that the insurance does in fact cover the liability established against the deceased pilot.

The declaratory relief sought addresses those questions and in my opinion the court should exercise its jurisdiction to hear the claim. No reason was advanced why the discretionary relief should not be granted upon proof by each plaintiff of the facts which establish the liability to indemnify the estate in the insurance company.

Accordingly, in my opinion each plaintiff is entitled to bring a proceeding against the insurance company at this stage seeking declaratory relief and the court has and should exercise its jurisdiction.

The South Australian decision of J.N. Taylor Holdings Ltd supra, supports my conclusion.

The Court of Appeal decision of C.E. Heath v. Pyramid Building Society supra, was dealing with a different set of facts. In that case, the court was of the opinion that there was no real legal controversy between the parties on the facts.

One other matter should be disposed of at this point.

It is asserted by a director of the insurance company that he understood that the flight which resulted in the incident was operating as a commercial operation and by reason of s.9(3) of the Act, the Act did not apply to the contract of aviation insurance.

Section 9(3) was repealed by the Financial Laws Amendment Act 1997, s.3, which came into operation on 30 June 1997 - see Schedule 8 of the amending Act. The Act substituted a new sub-section. It is irrelevant to the present issues.

Given that the Court should exercise its jurisdiction to hear the claim for the declaratory relief in the form sought by each plaintiff, the questions next arising are whether each plaintiff has satisfied the requirements of rule 9.06(b)(ii) and whether the court should exercise its discretion and order the joinder of the insurance company as a defendant.

The first element of the sub-paragraph of the rule is satisfied, namely, that there is a party in the proceeding, the plaintiff and a party to be added, the insurance company.

The next element necessitates a consideration of the issues in the proceeding.

As the proceeding is presently constituted the plaintiff has to prove that the deceased pilot owed a duty of care to the deceased passenger, that he was negligent, that the negligence caused the death of the passenger which in turn caused loss to the latter's dependants.

According to the evidence before the court, the insurance company has not yet been asked by the defendant estate, to indemnify it. However, the insurance company is a party in the Grostate proceeding. Further, the company has retained solicitors in the Grostate matter and has retained another firm to act in the two present proceedings. In addition, the latter firm has now taken over the Grostate matter.

The contract of insurances gives the right to the insurance company to take over the conduct of the three proceedings. It has not done so to date. The reality is that the defendant estate will not contest the claims brought by the three widows. The latter will have to prove their claims which should result in a relatively short trial. Once liability is established and quantum is determined the plaintiffs will each turn their sights on the insurance company.

The reality is that the plaintiffs will not obtain any satisfaction against the defendant estate.

If separate proceedings were brought against the insurance company pursuant to s.51, it would be necessary for each plaintiff to prove her case under the Wrongs Act, again, and the insurer could take any defence which had not been taken by the defendant in the proceeding.

The result in the later proceeding could be different to the judgment in the first trial. In addition, the insurance company could plead insurance matters by way of defence to the alleged liability under the contract of insurance.

The end result would be that each plaintiff would be facing another trial in which two causes of action would have to be established, namely, the Wrongs Act cause of action and the obligation on the insurance company to provide cover in respect of the liability of the deceased pilot.

In my opinion, there are a number of questions between the plaintiff in each case and the insurance company, which arise out of, relate to and are connected with the claim brought by the plaintiff against the defendant estate. These questions concern the elements of proof by the plaintiff under the Wrongs Act claim which are also essential elements of proof in any cause of action pursuant to s.51 of the Act. This follows because in my opinion the plaintiffs would have to prove the same matters against the insurance company to establish the liability.

It follows that the second element of proof, namely, the necessary similarity of questions between the parties and the proposed added party is established.

This brings me to the third element, namely, whether it is "just and convenient" to determine the questions between all parties to the proceeding? In other words, is it just and convenient to determine all the issues in the one proceeding even though there are discrete causes of action by the plaintiff against the first defendant and the proposed added defendant? This was the main area of dispute between the parties in the application before me.

The element involves consideration of two questions. The first is convenience.

In my opinion, it would be convenient to have both causes of action heard together. The cause of action against the defendant estate will not take long to prove. If the insurance company as an additional defendant seeks to test the plaintiff's case against the defendant it no doubt will be given permission to do so and if it wishes to raise any defence not taken by the estate in the claim brought against it, it would be appropriate that it do so.

In my opinion, the course proposed is practical, accords with common sense and will avoid costs. It is a convenient course to adopt.

One of the objects of Rule 9.06(b) is to prevent multiplicity of actions and to enable a court to determine disputes between all parties in one proceeding. This avoids the same or substantially the same questions or issues being tried twice, with possible different results.

There is a real risk in the present proceeding that if the proceeding against the insurance company was heard separately, the results could be inconsistent which invariably reflects upon the administration of justice. It is easier to understand and more palatable to the public if a judge presiding over all proceedings gives reasons why the results are different and inconsistent.

As a matter of logic, the plaintiff may succeed against the defendant estate because the latter does not take a particular defence and fail against the insurance company because it does take the particular defence. One judgment explaining the inconsistency is preferable to two different judgments from two different judges in respect of different proceedings.

It is convenient to have both causes of action heard together. Indeed, Mr Simpson of counsel did not contend otherwise.

This brings me to whether it is "just" that the insurance company should be joined as a defendant?

Mr Simpson, on behalf of the insurance company, submitted that it was not just to the insurance company to have the case against it heard at the same time as the case against the estate. The reasons advanced were financial and tactical.

He submitted that the findings made in the claim between the plaintiff and the estate did not bind the insurance company. I agree. There would be no issue estoppel or res judicata which would bind the insurance company as between the plaintiff and it.

He submitted that the insurance company should be permitted to observe the trial between the present parties and then have the opportunity to make a decision as to how it should contest the proceeding against it. In this context he submitted that the insurance company may plead different defences. Also it is entitled to have the benefit of observing the way the case was presented so that it would be forewarned when the case proceeded against it and hence be able to plan its defence with that knowledge.

With respect to the first point, the insurance company can plead the defences in the joint proceeding.

I agree that the insurance company would be deprived of observing what happened in the first trial and thereafter employing what tactics it could to gain some advantage. But that will be the position in most joinder applications and flies in the face of the object of the rule which is to avoid multiplicity of proceeding. Further, the question is one of justice to both the additional defendant and the parties to the proceeding.

In my opinion, justice to all demands the proceedings be heard together. It means one trial on the liability of the estate and hence, less legal cost.

Each plaintiff should not be pressured in their endeavour to obtain justice by the spectre of two trials, the risk of inconsistent results and extra costs.

Justice requires that the issues be decided by the one forum at the one trial.

The force of this point is underlined when it is noted that the insurance company is already a party in the Grostate matter. No doubt it will appear in that case and gain what benefit it can and then seek to re-litigate the issues again in the other two proceedings. Mr Curtain, Q.C. makes the point. The insurance company wants to have three bites of the cherry before facing up to its responsibilities. In my opinion, it should not be permitted to follow that course.

Mr Simpson also raised the question of additional costs, but the practical reality would be less costs if the two claims are heard together. Further, as Mr Curtain, Q.C. pointed out, there is some doubt whether the damages recoverable under s.51 of the Act includes the successful plaintiff's costs so that the plaintiffs may be faced with paying their own costs.

On the other side of the coin is justice to the plaintiffs. Each should be able to prosecute their claims expeditiously and inexpensively.

In my opinion, justice and convenience requires that the insurance company be joined as a defendant to enable all issues to be tried in the one proceeding.

The joinder of the insurance company will require it to deliver a defence which sets out whether it does have any defences to the claim under the Wrongs Act or any defences to the right of indemnity of the defendant's estate. The proceeding was issued some two years ago and the incident occurred some six years ago. The insurance company has had more than sufficient time to make a decision as to its attitude to the obligation to indemnify the deceased estate. In the light of all the circumstances and in particular the fact that the insurance company has consented to being joined in the Grostate matter, the point taken by the insurance company that the defendant's estate has not yet requested indemnity, has little substance. If the insurance company has a good insurance point then the sooner it sees the light of day and is resolved, the better it will be, and the fairer it will be to all interested parties.

In C.E. Heath's case supra, the Court of Appeal held that the joinder of an insurance company as an additional defendant to the proceeding was not appropriate in the circumstances.

The reasoning was summarised by Phillips, JA at p.295 when he said -

"In view of the uncertain relevance of the questions underlying the declarations, the arguable interest 'of the plaintiff in having the questions determined and determined in this proceeding and the 'improbable need' to have the appellants bound formally (by their being joined as defendants) to any findings made in the course of adjudication upon the main issue of the auditor's liability to the plaintiff, I do not consider that the respondents made out a case for the joinder of the appellants below. Certainly the respondents did not establish that the joinder was necessary in order 'to avoid a multiplicity of proceedings'."

As already noted, in that case, the insurer had already taken over and was conducting the proceeding on behalf of the named defendants. Further there was the fact that considerable additional expense would be incurred if the insurers were joined.

None of those factors exist here and in my opinion the case is plainly distinguishable from the present applications.

A number of procedural matters had to be attended to during the hearing. The application should have been made to a Master of the Court but because of the difficult questions of law to be decided, leave was given to the plaintiffs to bring the application before a judge.

It appears that the insurance company mistakenly believed that it had been joined as a party to each of the present proceedings and filed an appearance as a result. Counsel for the plaintiff in each case did not oppose an order that permission be given to remove the appearance from the court file.

The third matter was that an affidavit sworn by David Thomas Newey on 9 September 1998 on behalf of the insurance company contained a number of errors and again, Mr Curtain, Q.C. did not oppose an order permitting the removal of the affidavit from the file and its substitution by another affidavit.

Subject to submissions from counsel I propose to make the following orders in each proceeding

(i) Leave is given to each plaintiff to bring the application before a judge.

(ii) That Messrs MacPherson and Kelley be given leave to remove from the court file the appearance filed by them on behalf of Rural and General Insurance Limited dated 30 July 1998.

(iii) That the said Messrs McPherson and Kelley be permitted to remove the affidavit of David Thomas Newey sworn 9 September 1998 from the court file and substitute an affidavit by the same deponent sworn 15 September 1998.

(iv) That Rural and General Insurance Limited be joined as a defendant to the proceeding.

(v) That the plaintiff have leave to file and serve an amended statement of claim on or before 16 October 1998.

(vi) That the first defendant be permitted to rely upon her defence already filed and served.

(vii) That the added defendant file and serve its defence on or before the 6 November 1998.

(viii) That the plaintiff's costs of the application joinder and amended statement of claim be her costs in the cause.

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CERTIFICATE

I certify that this and the 18 preceding pages are a true copy of the reasons for judgment of Gillard, J. of the Supreme Court of Victoria delivered on .30 September 1998.

DATED: this 30th day of September 1998.

Associate

Insurance Contracts Act 1974

Laws Amendment Act 1997

At a glance

Court

Decision date

Before

Source

Judgment (139 paragraphs)

Legislation Cited (4)