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  • {solid} Appeal Determined (QCA)

Spencer v Nominal Defendant

 

[2007] QCA 254

Reported at [2008] 2 Qd R 64

 

SUPREME COURT OF QUEENSLAND 

 

PARTIES:

GRANT ROYSTON DAVID SPENCER
(applicant)
v
NOMINAL DEFENDANT
(respondent)

FILE NO/S:

DC No 504 of 2007

Court of Appeal

PROCEEDING:

Application for Leave s 118 DCA (Civil)

ORIGINATING COURT:

DELIVERED ON:

8 August 2007

DELIVERED AT:

Brisbane

HEARING DATE:

24 July 2007

JUDGES:

de Jersey CJ, Keane JA and Mullins J

Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDER:

1. Application for leave to appeal refused

2. Applicant to pay respondent's costs to be assessed

CATCHWORDS:

LIMITATIONS OF ACTIONS – CONTRACTS, TORTS AND PERSONAL ACTIONS – APPLICATION OF THE STATUTES TO PARTICULAR CAUSES OF ACTION – MOTOR VEHICLE INSURANCE – where applicant sought extension of time under s 57(2)(b) of the Motor Accident Insurance Act 1994 (Qld) within which to commence proceedings for damages for personal injuries – where consent order dispensed with need to comply with certain requirements of Act and specified date by which action must be commenced – where applicant did not commence action by that date – whether learned primary judge correctly exercised discretion under s 57(2)(b) regarding relevance of reason for delay – whether learned primary judge correctly identified reason for delay

District Court of Queensland Act 1967 (Qld), s 118(3)

Limitation of Actions Act 1974 (Qld), Pt 3

Motor Accident Insurance Act 1994 (Qld), s 51D, s 57(2)(a), s 57(2)(b)

Bazley v Nominal Defendant [2006] QDC 379 ; BD 1567 of 2006, 10 November 2006, discussed

Dempsey v Hack [2005] QCA 34 ; Appeal No 8721 of 2004, 18 February 2005, applied

Harvey v Phillips (1956) 95 CLR 235, cited

House v The King (1936) 55 CLR 499 , applied

Rockett & Anor v The Proprietors of "The Sands" BUP 82 [2001] QCA 99 ; Appeal No 4355 of 2000, 20 March 2001, cited

Winters v Doyle & Anor [2006] QCA 110 ; Appeal No 8286 of 2005, 13 April 2006, applied

COUNSEL:

G W O'Grady for the applicant

P Ambrose SC, with R B Dickson, for the respondent

SOLICITORS:

Taylors Solicitors for the applicant

WHD Lawyers for the respondent

[1]  de JERSEY CJ:  I have had the advantage of reading the reasons for judgment of Keane JA.  I agree with the orders proposed by His Honour and with his reasons.

[2]  KEANE JA:  The applicant was involved in a motor vehicle accident on 15 July 2003.  In March 2004, solicitors engaged by the applicant to pursue a claim for damages for personal injury suffered by him in the accident gave the respondent a notice of accident claim form pursuant to s 37 of the Motor Accident Insurance Act 1994 (Qld) ("the Act").  On 16 April 2004, the respondent advised the applicant's then solicitors that the respondent accepted that the notice was a compliant notice for the purposes of the Act.  The respondent informed the applicant's then solicitors of its denial of liability in November 2004. 

[3] On 14 July 2006, a consent order was made which dispensed with a compulsory conference and the exchange of final written offers of settlement.  This order also provided for an action for damages to be started by the applicant in respect of the claim no later than 14 July 2006, with that action, if started, to be stayed until the holding of a compulsory conference and the exchange of final offers of settlement.  The respondent had signed the consent order on 6 July 2006. 

[4] There was further correspondence between the parties, but, in the upshot, the applicant did not commence proceedings in respect of his claim until 5 October 2006. 

[5] On 24 October 2006, the applicant's then solicitors sought the respondent's waiver of the defence which had accrued in favour of the respondent by reason of the effluxion of time pursuant to the Limitation of Actions Act 1974 (Qld).  The respondent did not accede to this request; and, on 21 February 2007, the applicant sought an extension of time within which to commence his action pursuant to s 57(2)(b) of the Act.  That application was refused.

[6] The applicant now seeks leave to appeal against that refusal pursuant to s 118(3) of the District Court of Queensland Act 1967 (Qld).  Leave is necessary because of the interlocutory nature of the order sought to be challenged.  The practical effect of the order made below is to dispose of the applicant's claim for damages against the respondent.  It is, therefore, appropriate to move to a consideration of the prospects of success of the proposed appeal[1] on the basis that, if there is no real prospect that the proposed appeal will succeed, the application for leave should be refused.[2]

The prospects of success of the proposed appeal

[7] The proposed appeal is against the exercise of a discretion conferred on the learned primary judge by s 57(2)(b) of the Act.  That discretion allows a judge to relieve a claimant from the consequences of the expiry of the relevant period of limitation by allowing a longer period for the commencement of the proceeding than the period of six months after the giving of a notice of claim provided by s 57(2)(a) of the Act. 

[8] Because of the discretionary nature of the decision sought to be challenged, it is incumbent on the applicant to demonstrate error on the part of the learned primary judge in accordance with the statement of principle in House v The King.[3]  To that end, the applicant advances a number of arguments which may be grouped together under two broad headings.  First, it is contended that the learned primary judge erred in fettering the exercise of his discretion by holding that an explanation for delay related to the exigencies of compliance with the Act was a "condition precedent" to the exercise of the discretion and by ignoring other considerations relevant to the proper exercise of the discretion which had arisen.  Secondly, it is contended that the learned primary judge erred by mistaking the facts as to the reasons for the expiration of the limitation period applicable to the applicant's cause of action.  I will discuss these contentions in turn.

The importance of an explanation for delay

[9] As to the first of the applicant's contentions, it is, I think, clear that the learned primary judge did not treat an explanation of delay in terms of attempted compliance with the exigencies of the Act as a "condition precedent" to the exercise of the power to extend time under s 57(2)(b) of the Act as distinct from a consideration bearing upon the exercise of that power.  His Honour said:

"The provision in that paragraph allows the Court to fix a longer period within which a proceeding may be brought after the end of the period otherwise determined as the period of limitation under the Limitation of Actions Act, provided that one of the requirements of subsection (1) of that section is satisfied.  That was the case here because a notice of motor vehicle accident claim was given before the end of the period of limitation.

 Whether under that section an order can be made has been considered or supported by the decision of the Court of Appeal in Morris and Gardner v. Car Choice Proprietary Limited [2004] QCA 480 and the more recent decision of Winters v. Doyle is another [2006] QCA 110.  In that case the Court of Appeal emphasised that the important consideration when determining whether to exercise the power was to look at the question of whether the failure to commence proceeding within the limitation period was caused by the attempts, and possibly inadequate or misguided attempts, by the claimant or the claimant's solicitors to comply with the requirements of the Motor Accident Insurance Act.

That it was, in effect, an ameliorative provision which was intended to deal with a situation which might otherwise arise when somebody might have commenced a proceeding within time but for the requirements of that legislation.

Subsequently in the matter of Bazley v. Nominal Defendant [2006] QDC 379 I analysed the decision in Winters v. Doyle and drew from that certain conclusions as to the appropriate approach to an application of this nature, which I will not repeat in detail, but in the penultimate paragraph of the reasons in that matter I said that the crucial question is whether the delay which occurred was related to compliance with the Act, and that in turn depends on how it came about that the delay occurred.  That there was no personal fault on the part of the application is of assistance in such an application but it is not sufficient.

If the solicitor's delay was caused by attempts, possibly even misguided or inefficient attempts, to comply with the requirements of the Act then an exercise of the power under section 57 may well be appropriate, but where the delay was simply due to administrative inefficiency on the part of the solicitor, or indeed a persistent failure to make any reasonable effort to comply with the requirements of the Act, it seems to me to follow that from the approach in Winters that the applicant has not shown good grounds for an order under section 57, even in the absence of prejudice to the respondent."

[10]  There are three observations which should be made in relation to this passage.  First, his Honour's reasons must be understood in the light of his Honour's earlier decision in Bazley v Nominal Defendant.[4]  In Bazley v Nominal Defendant,[5] his Honour acknowledged that "whether the delay which occurred was related to compliance with the Act" was "the crucial issue, or at least a very important issue" relevant to the proper exercise of the discretion conferred by s 57(2)(b) of the Act.  Reference to that earlier decision shows that his Honour, in speaking of "the crucial question, [as] whether the delay which occurred was related to compliance with the Act", was concerned with the larger question, namely whether good reason had been shown by the applicant to exercise the discretion in the applicant's favour so as to defeat the limitation defence which had accrued in the respondent's favour. 

[11]  This Court's decision in Winters v Doyle & Anor[6] confirmed the view in Morrison-Gardiner v Car Choice Pty Ltd & Anor[7] that the discretion conferred by s 57(2)(b) was created to ameliorate the position for claimants who experience difficulty in complying with the technical requirements of the Act within the limitation period prescribed by the Limitation of Actions Act so that claims can be determined fairly on their merits.  Section 57(2)(b) of the Act cannot be regarded as standing free of the considerations which explain its presence in the Act.  These considerations serve to inform the proper exercise of the discretion.  If a person who seeks the exercise of the discretion conferred by s 57(2)(b) of the Act were not required to show good reason why that should occur in terms of the exigencies of the Act, the limitations upon the grant of an extension of the limitation period contained in Pt 3 of the Limitation of Actions Act would be written out of the law in any case of a motor vehicle claim where a notice of claim was given under the Act.  That is not an intention which can sensibly be attributed to the legislature. 

[12]  The second point to be made in respect of the passage from his Honour's reasons set out above is that the issue of prejudice to the defendant's prospects of a fair trial by reason of the delay is also a consideration relevant to whether there is good reason to exercise the discretion in favour of a claimant.  I do not understand his Honour to have suggested otherwise.  The learned primary judge's reference to Bazley v Nominal Defendant (which referred to matters of prejudice to the party opposing the application)[8] shows that his Honour did not proceed on the basis that the question of prejudice to the defendant was irrelevant to the exercise of his discretion. 

[13]  In this case, there appears to be no suggestion by the respondent that the prospects of a fair trial have been diminished by the delay which has occurred.  Nevertheless, quite apart from the consideration that the respondent would be prejudiced by the making of an order of the kind sought by the applicant in that the making of an order would deprive the respondent of a complete defence to the applicant's claim, the making of the order sought by the applicant would defeat the respondent's rights under the consent order of 14 July 2006.  In this regard, the respondent agreed to facilitate the commencement of the action by dispensing with requirements of the Act on the basis that the claim was to be started no later than 14 July 2006.  A consent order operates both as a contract and an order of the court.[9]  Whether the contract embodied in a consent order can be set aside depends on "the existence of a ground which would suffice to render a simple contract void or voidable or to entitle the party to equitable relief against it".[10]  No such ground is said to exist in this case.  To accede to the application under s 57(2)(b) of the Act would be to deprive the respondent of the benefit of the contract which underlay the consent order of 14 July 2006 where there is no other basis for setting aside that bargain.  It is unnecessary to decide whether s 57(2)(b) authorises such a course.  Even if the power conferred on the court by s 57(2)(b) extends to the destruction of contractual rights, it is a power which should be exercised only for the most compelling reasons because of the prejudice which it will inflict on the other party.

[14]  On the applicant's behalf, it was argued that s 51D of the Act operates on the consent order so as expressly to override a contract of the kind made here.  But s 51D(3) applies only to orders not agreements, a distinction which is important in a context which includes express reference in s 51D(2)(ii) to "agreement or order …".  Further, s 51D(2) has no application to the agreement contained in the consent order.  In any event, the applicant does not suggest that it can avail itself of s 51D in this case as an alternative to s 57(2)(b) of the Act.

[15]  The final observation to be made here is that, with all respect to the learned primary judge, it is undesirable to attempt to put a gloss upon the decisions of this Court in Morrison-Gardiner v Car Choice Pty Ltd or Winters v Doyle & Anor by elevating the discretionary consideration whether "the delay which occurred was related to compliance with the Act" to a consideration which is regarded as "crucial" or as "necessary" for the favourable exercise of the discretion conferred by s 57(2)(b) of the Act. 

[16]  As the decisions of this Court confirm, the reason for delay is one, albeit an important one, of the considerations bearing upon the determination of whether good reason has been shown to exercise the discretion conferred by s 57(2)(b) in favour of the grant of an extension of time.  That discretion is conferred to ensure that the need to comply with the Act does not prevent a claimant with a good case from having that case fairly tried.  In the light of this appreciation of the purpose of s 57(2)(b), the considerations which bear upon the proper exercise of the discretion can be fairly readily discerned.  Considerations other than the need to comply with the Act which will usually be relevant in this regard are the length of delay, whether there has been a general lack of diligence in the prosecution of the claim, whether the prospects of a fair trial of the claim have been diminished, and the circumstance that the exercise of the discretion is apt to deny the respondent a complete defence to the claim.  The weight to be accorded to these considerations in any particular case is a matter for discretionary assessment.

The facts in relation to the expiration of the limitation period

[17]  As to the second aspect of the challenge to the decision below, his Honour said:

"There was, thereafter, a good deal done on the part of the applicant's solicitors, particularly in terms of gathering evidence.  They appear to have been casting their nets very widely in that regard and a good deal was done there particularly, it seems from the chronology, in November 2005.  What is less clear is that there was any sort of systematic progression towards compliance with the processes required under the Act.

Ultimately, it appears that it occurred to the applicant's solicitors that they were not going to be able to comply with the processes within time, and on 27 June 2006 they filed an application to cope with this seeking an order that the compulsory conference be dispensed with, that the obligation to exchange mandatory final offers be dispensed with, and that an action for damages be started by the applicant in respect of the claim by no later than 14 July 2006."

[18]  The applicant directs particular criticism at the learned primary judge's view that it was not clear that "there was any sort of systematic progression towards compliance with the processes required under the Act".  The applicant points to the considerable work which was done, and which was necessary to enable a compulsory conference to be held as required by the Act. 

[19]  In my respectful opinion, this criticism of his Honour's reasons misses the point made by his Honour, which was not that the applicant's former solicitors had been idle: his Honour acknowledged that "a good deal was done".  His Honour's point was that this work was not informed and organised by a conscious plan aimed towards holding a compulsory conference at any given time.  There is no evidence of correspondence or memoranda which reflect such an ambition.  Accordingly, the learned primary judge's observation simply reflects the absence of evidence that a conscious appreciation of the requirements of the Act framed the preparation of the case by the applicant's former lawyers.

[20]  It is also argued that the learned primary judge found that the applicant himself had not been personally responsible for the delay which occurred.  Further, it is said that it is relevant that the consent order of 14 July appears to have departed from instructions given by the applicant.  This latter consideration may be a matter of legitimate complaint between the applicant and his former solicitors, but that does not affect the respondent's right to rely upon the consent order; and, more importantly for the purposes of this aspect of the applicant's argument, these considerations do not demonstrate that the learned primary judge's discretion miscarried.

[21]  Before the learned primary judge, the thrust of the applicant's case was that the need to invoke s 57(2)(b) of the Act had been occasioned by diligent attempts to comply with the requirements of the Act.  In other words, before the learned primary judge, the applicant's contention was that the applicant's former lawyers had been diligent in their attempts to observe the requirements of the Act.  The learned primary judge had no reason to consider the extent of the applicant's own diligence as affording good reason to extend time under s 57(2)(b).  The applicant's reliance in this Court on the decision in Perdis v Nominal Defendant[11] was thus beside the point. It is hardly surprising that the learned primary judge's disposition of the case was focussed upon the contention that diligent preparation attuned to the requirements of the Act occasioned the delay, rather than the lack of personal diligence on the applicant's part.  Nor is it surprising that the argument which was advanced was rejected by his Honour. 

[22]  It was open to his Honour to dispose of the application on the basis that the requirements of the Act had nothing to do with the applicant's need to invoke s 57(2)(b) of the Act to avoid the consequences of the expiration of the relevant period of limitation.  The consent order of 14 July 2006 obviated the need for compliance with the Act before an action was commenced.  The action was not commenced.  The only explanation for that failure was that it was due to "an oversight by [the applicant's then] lawyers".  That statement may be an admission of negligence, but it is not an explanation.  How and why this "oversight" occurred is not explained.  Nor is the delay which occurred between July and October when the action was commenced. 

[23]  What is abundantly clear, however, is that the occasion for the applicant to seek to invoke s 57(2)(b) of the Act did not arise because of the need to comply with the Act.  The relevant requirements of the Act had been dispensed with by the agreement of the respondent and the consent order made pursuant to that agreement.  There was no obstacle to the commencement of the applicant's action within the limitation period save the unexplained "oversight" of the applicant's then solicitors.  There is not a scintilla of evidence to suggest that this "oversight" had anything at all to do with the Act.

[24]  In these circumstances, it is hardly surprising that his Honour concluded that good reason had not been shown to exercise the discretion conferred by s 57(2)(b) of the Act in favour of the applicant.

Conclusion and orders

[25]  The applicant's need to invoke s 57(2)(b) was not shown to have been occasioned by the requirements of the Act.  No good reason was shown to deprive the respondent of a defence under the Limitation of Actions Act contrary to the terms of the consent order of 14 July 2006.

[26]  The proposed appeal enjoys no prospect of success.  Accordingly, in my respectful opinion, leave to appeal should be refused.

[27]  The applicant should pay the respondent's costs to be assessed.

[28]  MULLINS J:  I agree with Keane JA.

Footnotes

[1] Cf Winters v Doyle & Anor [2006] QCA 110.

[2] Dempsey v Hack [2005] QCA 34.

[3] (1936) 55 CLR 499 at 504 – 505.

[4] [2006] QDC 379.

[5] [2006] QDC 379 at [11] – [19].

[6] [2006] QCA 110 at [24] – [26], [32] – [39].

[7] [2004] QCA 480.

[8] [2006] QDC 379 at [11].

[9] Harvey v Phillips (1956) 95 CLR 235.

[10] Harvey v Phillips (1956) 95 CLR 235 at 243 – 244; Rockett & Anor v The Proprietors of "The Sands" BUP 82 [2001] QCA 99 at [18]. See also General Credits Limited v Ebsworth [1986] 2 Qd R 162 at 165.

[11] [2003] QCA 555.

Close

Editorial Notes

  • Published Case Name:

    Spencer v Nominal Defendant

  • Shortened Case Name:

    Spencer v Nominal Defendant

  • Reported Citation:

    [2008] 2 Qd R 64

  • MNC:

    [2007] QCA 254

  • Court:

    QCA

  • Judge(s):

    de Jersey CJ, Keane JA, Mullins J

  • Date:

    08 Aug 2007

Litigation History

Event Citation or File Date Notes
Primary Judgment DC504/07 (No Citation) 21 Feb 2007 Application for leave to extend time to commence claim for damages for personal injury arising from motor vehicle accident; explanation for delay insufficient; that there was no personal fault on the part of the application is of assistance in such an application but it is not sufficient; application dismissed.
Appeal Determined (QCA) [2007] QCA 254 [2008] 2 Qd R 64; (2007) 48 MVR 389 08 Aug 2007 Application for leave to appeal against decision of District Court to refuse extension of time to commence proceeding for damages for personal injury arising from motor vehicle accident pursuant to section 57 Motor Accident Insurance Act; the reason for delay is an important consideration bearing upon whether good reason has been shown to exercise the discretion conferred by s 57(2)(b); leave to appeal refused with costs: de Jersey CJ, Keane JA and Mullins J.

Appeal Status

{solid} Appeal Determined (QCA)