Victrawl Pty Ltd v Telstra Corp Ltd - [1995] HCA 51 - HCA 1995 case summary — Zoe

CTHHCA

Victrawl Pty Ltd v Telstra Corp Ltd

[1995] HCA 51

High Court of Australia|1995-10-03|Before: Gaudron JJ, Brennan J, Karminski J, As Lloyd J

View original source

At a glance

Source facts

Court

High Court of Australia

Decision date

1995-10-03

Before

Gaudron JJ, Brennan J, Karminski J, As Lloyd J

Source

Original judgment source is linked above.

Judgment (112 paragraphs)

[1]

High Court of Australia Brennan, Deane, Dawson, Toohey and Gaudron JJ Victrawl Pty Ltd v Telstra Corp Ltd [1995] HCA 51

[2]

Appeal allowed to the extent that the answer given by the Full Court of the Federal Court to Question 2 in the stated case should be altered to read: "No."

[3]

This appeal is brought from judgments of the Federal Court in proceedings in which a party seeks to limit its liability in accordance with the provisions of the Convention on Limitation of Liability for Maritime Claims 1976 (the 1976 Convention). Subject to some immaterial exceptions, s 6 of the Limitation of Liability for Maritime Claims Act 1989 Cth (the 1989 Act) provides that the 1976 Convention provisions "have the force of law in Australia". The 1989 Act commenced on 1 June 1991. Prior to 1 June 1991, Div 1 of Pt VIII of the Navigation Act 1912 Cth was in force. Subject to some immaterial exceptions, s 333 (a section in that Division) provided that the provisions of an earlier Convention - the International Convention relating to the limitation of the liability of owners of sea-going ships 1957 (the Brussels Convention) - "have the force of law as part of the law of the Commonwealth". Division 1 of Pt VIII of the Navigation Act was inserted by an amending Act and came into operation on 31 January 1981 [1] . It was repealed by s 13 of the 1989 Act after Australia had denounced the Brussels Convention. The denunciation became effective on 31 May 1991. On the following day, the 1976 Convention entered into force for Australia. Thus the Brussels Convention bound Australia and had "the force of law as part of the law of the Commonwealth" prior to 1 June 1991 and the 1976 Convention binds Australia and has "the force of law in Australia" on and after that date.

[20]

A shipowner's liability is not limited by the Brussels Convention or by s 333 of the Navigation Act. Nor is a shipowner's liability limited by the 1976 Convention or by s 6 of the 1989 Act. The protection given to shipowners by the 1976 Convention, like the protection given by the Brussels Convention, is given only on the making of a decree limiting liability or, in the case of protection against claims in rem, on the constitution of a limitation fund. Thus Art 13 of the 1976 Convention bars claims only "[w]here a limitation fund has been constituted" and requires a State Party bound by the Convention to release arrested ships only "[a]fter a limitation fund has been constituted". Bearing in mind that a leading purpose of the Convention is the protection of shipowners and their ships against claims in rem [25] , obligations of the States Parties to apply the agreed rules are clearly intended to be mutual and contemporaneous. Yet those obligations would be radically incongruous if the application by each State Party of the rules relating to immunity from arrest and release from arrest of ships depended on whether the casualty occurred before or after the respective dates on which the Convention came into force for the respective States Parties. Article 15, par 1 provides that the 1976 Convention shall apply to proceedings for the release of a ship or the discharge of a security. If proceedings for release are governed by the 1976 Convention, the same Convention must have been intended to apply to the constitution of a limitation fund which precludes the arrest of a ship or the need to provide other security. It is impossible to suppose that the obligation of one State Party to release an arrested ship should arise when a limitation fund is constituted with a court of that State under the 1976 Convention while another State Party bound by the same Convention would be bound to release the ship if a limitation fund were constituted with its court under the Brussels Convention. Such a disparity of obligation would be anomalous.

[22]

A provision similar to Art 15, par 1 was to be found in Art 7 of the Brussels Convention, but when, on 1 June 1991, Div 1 of Pt VIII of the Navigation Act was repealed, the jurisdiction of the municipal courts to apply the rules prescribed by the Brussels Convention ceased. Although s 8(c) of the Acts Interpretation Act 1901 Cth provides that the repeal of part of an Act does not "affect any right privilege obligation or liability acquired accrued or incurred" under the repealed part unless a contrary intention appears, the repeal of s 333 of the Navigation Act created no work for s 8(c) to do. No claimant whose claim was subject to limitation under the Brussels Convention had acquired his cause of action under s 333 of the Navigation Act. No shipowner who had not already had its liability limited under the Brussels Convention had any accrued right under s 333 of the Navigation Act. No right had accrued to a shipowner under s 333 though that section entitled a shipowner to apply for a decree limiting liability and to constitute a limitation fund in accordance with the Brussels Convention [26] . A right to apply for a decree carrying a right to constitute a limitation fund pursuant to the decree cannot be classified as an accrued right for the purposes of s 8(c) [27] . Although the right to make an application under some statutes might be held to be an accrued right [28] , the right arising under the Brussels Convention as incorporated into municipal law by s 333 of the Navigation Act cannot be so classified. To classify a right to apply for a limitation decree under the Brussels Convention as an accrued right would be to disrupt the regime established by the Brussels Convention and by the 1976 Convention which calls for uniform and concurrent application of rules relating to limitation of liability, constitution of limitation funds and release of ships. That regime, to which s 333 of the Navigation Act and the 1989 Act gave effect in municipal law cannot be disrupted by attributing to the Conventions an operation derived from a municipal law of interpretation prima facie applicable to the operation of municipal statutes. No decree could be made nor could a limitation fund be constituted under the Brussels Convention on or after 1 June 1991.

[78]

The rule at common law is that a statute ought not be given a retrospective operation where to do so would affect an existing right or obligation unless the language of the statute expressly or by necessary implication requires such construction. It is said that statutes dealing with procedure are an exception to the rule and that they should be given a retrospective operation. It would, we think, be more accurate to say that there is no presumption against retrospectivity in the case of statutes which affect mere matters of procedure. Indeed, strictly speaking, where procedure alone is involved, a statute will invariably operate prospectively and there is no room for the application of such a presumption. It will operate prospectively because it will prescribe the manner in which something may or must be done in the future, even if what is to be done relates to, or is based upon, past events. A statute which prescribes the manner in which the trial of a past offence is to be conducted is one instance. But the difference between substantive law and procedure is often difficult to draw and statutes which are commonly classified as procedural - statutes of limitation, for example - may operate in such a way as to affect existing rights or obligations. When they operate in that way they are not merely procedural and they fall within the presumption against retrospective operation. Accordingly, the question arises whether the conferral by s 6 of the 1989 Act of the force of domestic law on the 1976 Convention would, if given unconfined operation, affect pre-existing substantive rights or liabilities. For the reasons which follow, that question should be answered in the affirmative. As will be seen, the 1976 Convention, in its domestic operation pursuant to the 1989 Act, constitutes a significant part of the local substantive law defining the rights and liabilities of claimants and shipowners [47] in respect of the claims which are subjected to its provisions. 1. See Stevens v Head (1993) 176 CLR 433 at 457 2. (1990) 169 CLR 515 at 518, per Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ. 3. Under the 1976 Convention, "shipowner" or "salvor".

[80]

Each Convention provides for the establishment by the shipowner of a limitation fund pursuant to the national laws of the State Party in which the fund is constituted and, once such a fund is established, for the confinement of relevant claimants to the exercise of rights against that fund. That confinement of claims has been held, when adopted in domestic law, to entitle the protected shipowner to the entry of a caveat against the issue in Admiralty of a warrant of arrest of any of his ships at the suit of an affected claimant [49] . Each Convention substantially defines the claims to which it applies by identifying designated categories of occurrence in respect of which a claim or claims might be brought. The limits of liability prescribed by each Convention are limits of total liability in respect of all relevant claims arising on a "distinct occasion" [50] . In short, and subject to particular exceptions or exclusions, each Convention, when properly invoked by a shipowner who establishes the appropriate limitation fund, effectively transforms the rights of affected claimants to recover full compensation from the shipowner (or the shipowner's property) into rights to payment of a proportionate amount of a limited fund. To adopt the phraseology of some of the United States cases [51] , the overriding limitation imposed by each Convention "attaches to", and limits and confines, the rights of affected claimants to recover compensation throughout the international regime which the Convention establishes. Conversely, each Convention confers upon the protected shipowner the right to limit total liability throughout that regime. Neither Convention can properly be seen as confined either to the procedure of the courts of a particular country or to matters of mere procedure. Each operates to require all of the State Parties to it to participate in and observe an international regime controlling and limiting substantive rights and liabilities in respect of the claims which are subjected to its provisions.

[84]

Let it be assumed, solely for the purpose of illustration, that the occurrence in the present case involved a ship owned by S and a submarine cable owned by C, that the occurrence resulted from S's actual fault or privity falling short of an intentional or reckless infliction of loss by personal act or omission, that C had a good claim at common law against S for all the damage sustained by reason of the occurrence and that the quantum of those damages would, if assessed, be $20m. Let it also be assumed that the requisite funds under the respective Conventions corresponded with those which the Court was informed were the actual figures in the present case, namely $2.7m if the Brussels Convention were applicable and $7.6m if the 1976 Convention were applicable. Under that hypothetical example, C had, at the time of commencement of the 1989 Act, a right of action for unliquidated damages of a value of $20m against S which, by reason of S's actual fault or privity, was removed from the reach of the Brussels Convention. That position would be completely altered if s 6 of the 1989 Act retrospectively conferred the force of domestic law upon the 1976 Convention with the result that that Convention applied to C's claim against S. S's actual fault or privity would not prevent it from invoking limitation of liability under the 1976 Convention in respect of the occurrence. The result would be that S, upon the commencement of the 1989 Act, would acquire a new right to limit its total liability pursuant to the 1976 Convention in respect of an occurrence which had occurred both before the commencement of that Act and before that Convention came into force for Australia. C's common law right to recover damages equivalent to $20m which had previously been unqualified would be made subject to S's right to limit liability and would be effectively reduced to a right to recover damages of a maximum (depending upon other claims) amount of $7.6m. From being a claim for $20m which, after judgment, could be enforced against S or its assets, C's claim would be converted into a claim which could, after limitation of liability and establishment of an appropriate fund, be enforced only against a fund of $7.6m which was also liable to meet, ratably, any other claims [55] arising from the same occurrence.

[97]

There is no transitional clause in the 1976 Convention. Nor is there any special clause expressly providing whether the Convention binds a State Party thereto with respect to facts or events which had occurred before that State Party was bound thereby. The three provisions which might arguably be seen as favouring or militating against a retrospective operation of the Convention are Art 15.1, Art 17.3 and Art 17.4. All three are, upon examination, at best equivocal. Article 15.1 provides that "[t]his Convention shall apply whenever any person referred to in Article 1 seeks to limit his liability". The persons referred to in Art 1 are, however, described by the heading to that Article as "Persons entitled to limit liability" and are shipowners who "may limit their liability in accordance with the rules of this Convention for claims set out in Article 2". In that context, Art 15.1 is controlled by the operative provisions of Arts 1 and 2 and the use of the word "whenever" in Art 15.1 does not suffice to indicate an intention that the ordinary presumption against the retrospectivity of those operative provisions should be overridden. Article 17.3 provides that, for a State such as Australia which became a party to the Convention after it commenced operation, "the Convention shall enter into force on the first day of the month following the expiration of ninety days after the date when such State deposited its instrument" of ratification, acceptance, approval or accession. That provision does not suffice to indicate a positive intention that the Convention should not, once it enters into force for a particular State Party, apply to events occurring before that time. Article 17.4 provides that, as between State parties to it, the 1976 Convention replaces and abrogates the Brussels Convention. That provision does not indicate a positive intent that the 1976 Convention should replace the Brussels Convention with respect to occurrences which occurred while the Brussels Convention was in force and the 1976 Convention was not in force for the affected State Party.