Wythes v McCaffery & 1 Ors

JUDGMENT OF : Beazley JA at 1; Santow JA at 2; Ipp JA at 24 DECISION : Appeal dismissed. Appellant to pay the costs of the Second Respondent.

CATCHWORDS : PROCEDURE - Motor vehicle accident involving teenaged boys on a rural property owned by the appellant - unregistered vehicle - Whether error in not ordering joinder of Nominal Defendant - whether Motor Accidents Act 1988 (NSW) or Motor Accidents Compensation Act 1999 (NSW) applied - whether appellant in a position to obtain necessary notice to comply with the mandatory requirement of s36(3) of Motor Accidents Compensation Act 1999 (NSW). Law Reform (Miscellaneous Provisions) Act 1946 s5(1)(c) LEGISLATION CITED : Motor Accidents Act 1988 (NSW) s20B; s28B; s43 Motor Accidents Compensation Act 1999 (NSW) Pt 2.4; s3; s31; s33; s36; s67; s72; s74 Road Transport (Vehicle Registration) Act 1997 Michael David WYTHES (Appellant) PARTIES : Paul John McCAFFERY (First Respondent) NOMINAL DEFENDANT (Second Respondent) FILE NUMBER(S) : CA 40777/03 P BLACKETT, SC/ D WILKINS (Appellant) COUNSEL : D CAMPBELL, SC (First Respondent) A S MORRISON, SC (Second Respondent) Hunt & Hunt - Sydney (Appellant) SOLICITORS : Messenger & Messenger - Orange (First Respondent) I V Knight, Crown Solicitors (Second Respondent)

LOWER COURT District Court JURISDICTION : LOWER COURT DC 172/01 FILE NUMBER(S) : LOWER COURT O'Reilly DCJ JUDICIAL OFFICER :

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40777/03 CL 172/01

BEAZLEY JA SANTOW JA IPP JA

8 OCTOBER 2004 Michael David WYTHES v Paul John McCAFFERY & 1 Ors Judgment 1 BEAZLEY JA: I agree with Santow JA. 2 SANTOW JA: INTRODUCTION The sole issue left in this appeal, following compromise and settlement of part thereof, concerns whether the trial judge O'Reilly DCJ was in error in not ordering the joinder of the Nominal Defendant on the appellant's application. The trial judge instead dismissed the appellant's Notice of Motion seeking that joinder pursuant to s36 of the Motor Accidents Compensation Act 1999 (NSW) ("MACA"), being the successor provision to s20B of the Motor Accidents Act 1988 (NSW) ("MAA"). 3 The trial judge, O'Reilly DCJ, had refused the application on the basis that the appellant had not framed his action brought by way of second cross-claim so as to qualify as "a claim or proceeding under this Act" as required by s36(1) of MACA; Judgment Red, 37U-V. 4 The appeal arises in circumstances which began with a motor vehicle accident involving four teenaged boys on 24 September 1995 on a rural property owned by the appellant, a Mr Michael Wythes. 5 The original claim was brought by one of the teenaged passengers who was injured, a Mr Paul McCaffery, then fourteen years old. He suffered injuries when the car, driven by another teenager, collided with a tree. The four teenagers in the car were at the property at the time for a camping weekend. A set of keys had been left in the ignition. One of the boys, Andrew Wythes, had his father's permission to drive the car, but no-one else was authorised to do so. Mr McCaffery's claim was not a statutory one but a common law claim. It was brought against Mr Michael Wythes, principally for failure to secure a dangerous chattel and exercise supervision and control over the activities of children who were invitees to his property. Mr Wythes cross-claimed at the time against Mr Danny Sharpe, the driver of the motor vehicle, for indemnity and contribution, the cross-claim remaining to be heard pending this appeal. However, since the appeal was heard, the Court has been advised that all matters in dispute between the appellant and Mr McCaffery, the first respondent have been settled. 6 The appellant never had given to him notice of Mr McCaffery's claim pursuant to the then applicable s43(4) of MAA. It appears in s43 in the following terms: "43 Time for and notice of making of claims (1) The object of this section is to promote the early making of claims to enable the insurer:

(a) to commence investigations while evidence relating to a claim is available, and (b) to identify injuries and facilitate the access of claimants to appropriate injury management and rehabilitation services and thus to expedite the claimant's recovery, and (c) to allow the insurer to more accurately predict claim frequency and hence formulate premiums.

(2) A claim must be made within 6 months after the relevant date for the claim. The relevant date is the date of the motor accident to which the claim relates unless the claim is made in respect of the death of a person, in which case the relevant date is the date of the person's death. (3) (Repealed) (4) A claim is made by giving notice of the claim to the person against whom the claim is made and, if that person's insurer is a third-party insurer, to the insurer. (5) The requirement under subsection (4) (only in so far as it is a requirement to give notice of a claim to the person against whom the claim is made and without affecting the requirement to give notice to the insurer) does not apply if:

(a) that person is dead, or (b) that person cannot be given notice." 7 In the absence of the notice under s43(4), it therefore appears that the claim made by Mr McCaffery against the appellant may have failed to comply at all with the MAA insofar as s43 is concerned. It does not appear that any point as to the competence of such claim was ever taken by the appellant or that the appellant sought that the claim be rendered in conformity with s43 of MAA. 8 As it becomes relevant in the disposition of this appeal, I should point out that the counterpart provision for claims made after the coming into force of MACA in 1999 "relating to a motor accident occurring after the commencement of [MACA] Act", is to be found in s72 of MACA. It is in the following terms: "72 Time for and notice of making of claims

(1) A claim must be made within 6 months after the relevant date for the claim. The relevant date is the date of the motor accident to which the claim relates unless the claim is made in respect of the death of a person, in which case the relevant date is the date of the person's death. (2) A claim is made by giving notice of the claim as follows: (a) in the case of a claim against a person whose insurer is a third-party insurer, to the person's insurer, (b) in any other case, to the person against whom the claim is made. (3) The requirement under subsection (2) (only in so far as it is a requirement to give notice of a claim to the person against whom the claim is made and without affecting the requirement to give notice to the insurer) does not apply if: (a) that person is dead, or (b) that person cannot be given notice." 9 In the events that happened, the claim brought by Mr McCaffery against the appellant, whether competent or not, was as I have said, compromised and settled. That left the appellant's cross-claim against the driver Mr Danny Sharpe for indemnity and contribution as well as the second cross-claim sought to be pursued on this appeal against the Nominal Defendant. This pursuit is on the basis that s36 MACA was complied with. That section is in the following terms: 36 Nominal Defendant as tortfeasor (1) The Nominal Defendant may join another person, or may be joined, for contribution or indemnity in respect of a claim or proceedings under this Act as if the Nominal Defendant were a tortfeasor. (2) Joinder of the Nominal Defendant is required to be effected in accordance with this section. (3) A person seeking to join the Nominal Defendant in respect of a claim or proceedings must give the Nominal Defendant notice of the person's intention to do so. The notice must include a copy of the notice of claim under section 72 given to the person. (4) The notice must be given within 3 months after the claim is made against the person under section 72, or within 3 months after the person becomes a party to proceedings in respect of the claim, whichever occurs first. (5) The court may extend the period for giving notice to the Nominal Defendant if the person seeking to join the Nominal Defendant gives a full and satisfactory explanation for not having given notice within the 3-month period. (6) Within 2 months after notice is given, the person giving notice must provide the Nominal Defendant with full details of the allegations made against the Nominal Defendant (or against the person to whom the Nominal Defendant is taken to have issued a third-party policy). (7) An application may not be made to join the Nominal Defendant as a party to proceedings before the court after 3 years from the date on which the claim under section 72 in respect of which contribution or indemnity is sought must be made, except with the leave of the court. (8) If the Nominal Defendant is sought to be joined because the identity of another motor vehicle is not known, joinder may not be effected unless due inquiry or search to identify the vehicle has been made. The inquiry or search may be proved orally or by affidavit of the person who made the inquiry or search. (9) Except as provided by this section, nothing in this section affects any rules of court relating to the joinder of parties."

In particular it is claimed that s36(3) was not complied with. 10 The appellant's case is essentially that s72 of MACA is not applicable at all in the circumstances. This is because s72 applies by virtue of s67 only "in respect of a claim relating to a motor accident occurring after the commencement of this Act" [emphasis added]. Then it is submitted that the present claim related to a motor accident occurring before that commencement. Thus, it is contended that the last sentence of s36(3) was in the circumstances otiose. This was because there was in fact no requirement for a Notice of Claim under s72 to have been given to the appellant, as the person seeking to join the Nominal Defendant. The appellant had in fact never received such a notice but so the argument goes, nor was he entitled to so far as the MACA legislation is concerned. 11 The Nominal Defendant's submission relies upon its Notice of Contention. It is to the effect that the trial judge should have held that the Nominal Defendant could not be joined pursuant to s36 MACA due to non-compliance with s36(3). Moreover, in relation to the original proceedings brought by Mr McCaffery against the appellant, it was for the appellant to require that the relevant notice be given by Mr McCaffery pursuant to the originally applicable s43 MAA. Hence in failing so to do, when that Notice is identical with the Notice under s72 MACA, the appellant placed himself in a position where he could not comply with s36(3).

DISPOSITION OF APPEAL 12 It is convenient to commence with Pt 2.4 of MACA, which applies "to and in respect of the motor accident occurring before or after the commencement of this Act"; see s31. Thus the relevant provisions of Pt 2.4 which include s36, apply though the relevant motor accident, as in this case, occurred before the commencement of MACA. 13 Claims against the Nominal Defendant arise where, as here, the vehicle is not insured, being an unregistered vehicle. Thus s33(1) of MACA is in the following terms: "(1) An action for the recovery of damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle that is not an insured motor vehicle in the use or operation of the vehicle on a road in New South Wales may be brought against the Nominal Defendant." 14 It is not presently in dispute that the unsealed road on the property where the accident occurred was a "road" within the meaning of MACA. Thus, assuming MACA applies "'road' means a road within the meaning of the Road Transport (Vehicle Registration) Act 1997 other than an excluded area". 15 The Road Transport (Vehicle Registration) Act 1997 in turn defines "road" as "… an area that is open to or used by the public and is developed for, or has as one of its main uses, the driving or riding of motor vehicles". In the Nominal Defendant's submissions, it is recorded that "the Nominal Defendant makes no submission as to the issue of whether or not the accident occurred on a 'road or road related area' within the meaning of the relevant legislation". Essentially the Nominal Defendant agrees that the statutory provisions which are applicable to the joinder of the Nominal Defendant in this case are those found in Pt 2.4 of MACA, so far as the current application is concerned, though noting that at the date of the accident s28B of the MAA applied, the provisions of which were relevantly the same as s36 within Pt 2.4 of MACA. The Nominal Defendant states in its written submissions that "[T]here has been no submission made in this Court or below that s36 ought not apply". 16 The kernel of the Nominal Defendant's case is that the mandatory provisions in s36(3) cannot be avoided, as the subsection contains no element of discretion. 17 There is no dispute between appellant and Nominal Defendant that the only apparent foundation for the claim against the Nominal Defendant is s5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946 which provides for contribution between joint tortfeasors. It is accepted that such a claim would fall within the ambit of the words in s36(1) of MACA which is set out again below for convenience: "(1) The Nominal Defendant may join another person, or may be joined, for contribution or indemnity in respect of a claim or proceedings under this Act as if the Nominal Defendant were a tortfeasor." 18 Thus it is not disputed that the claim against the Nominal Defendant is a "claim" within the meaning of s3 of MACA as "a claim for damages in respect of the … injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of a vehicle". 19 This is subject to the qualification that the point was never taken that, so far as the common law claim brought against the owner (the appellant), it was not framed in terms of "the use or operation of a vehicle". Nor was any point taken that the bodily injury suffered was not an "injury" insofar as the owner was concerned, because the particularised claim against the owner related not to the driving of the vehicle but in negligently allowing access to it in the case of the under-aged drivers. However, I do not need to consider the particular consequences that would flow from this proposition, if correct, beyond recognising that this appears to explain the absence of any notice given pursuant to s43(4) of MAA to the appellant and the insurer. It should be noted that the MAA is similarly predicated on there being a "claim". "Claim" under s40 means "a claim for damages in respect of the … injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle" [emphasis added]; there is, however, a different and arguably wider definition of "road" in s3 of that Act. 20 The Nominal Defendant then submits that the appellant was in a position to insist upon the giving of notice pursuant to s43 MAA and, had the appellant done so, the form of Notice of Claim provided pursuant to s43 would have been identical with that required by ss72 and 74 of MACA, so enabling compliance with the mandatory provisions of s36(3) of MACA. In addition clause 7 of Schedule 5 of MACA should be noted. It provides in the fifth schedule, clause 7, that "anything that was done under or had effect under a provision of Division 5 of Part 3 of the 1988 Act in relation to the Nominal Defendant is, after the commencement of this Act, also taken to have been done under or to have effect under the corresponding provision of this Act". 21 Thus had notice been given pursuant to s43(4) of MAA, that notice would have had effect equivalently under MACA. 22 I conclude that the Nominal Defendant is essentially correct in its submissions. Section 36 is clearly predicated upon the Notice of Claim being provided to the Nominal Defendant by the person seeking its joinder, and must do so, within the time period specified in s36(4). This is subject to the powers of the court to extend that period if satisfied that a full and satisfactory explanation for not giving notice within the required three month period has been given. The fact that no notice of the claim was ever sought under the MAA legislation, being the legislation applicable to the claim brought by Mr McCaffery against the appellant, may leave the status of that claim open to challenge. That, however, is not a matter before us. But, whether open to challenge or not, either the claim is incompetent, in which case there is no occasion for joining the Nominal Defendant, as the claim for proceeding may then fall outside Pt 2.4 or, as the Nominal Defendant primarily contends, the appellant was in the position to obtain the necessary notice and should have done so in order to comply with the mandatory requirement of s36(3). Either way, the appellant must fail.

OVERALL CONCLUSION AND ORDERS 23 I conclude that the appellant fails in its appeal against the judgment by the trial judge denying the application by the appellant to join the Nominal Defendant. I would propose the following orders: 1. Appeal dismissed. 2. Appellant to pay the costs of the second respondent. 24 IPP JA: I agree with Santow JA. **********

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