Mackay v Cusack[1998] QDC 320

CHAMBERS

JUDGE ROBIN QC

and

and

BRISBANE

DATE 19/10/98

JUDGMENT

HIS HONOUR: As Mr Davis said at the callover, although on the face of it a simple matter this was a complex one in which his client faced multiple problems. The crux of them is the failure to institute a claim for damages for personal injuries which Mr Mackay suffered in a motor vehicle accident on 27 October 1994 within the three year limitation period.

The plaintiff and his legal advisers were aware of the coming into operation of the Motor Accident Insurance Act 1994 on 1 September 1994 and the proper notice was given to FAI General Insurance Company Limited which was the insurer pursuant to the compulsory third party scheme of the vehicle which Mrs Cusack was driving at the time of the collision. Mr Mackay was riding a motorcycle of his own. He commenced proceedings in the Magistrates Court at Cleveland on 6 December 1994 in respect of property damage to his motorcycle.

The present application is for transfer of those proceedings to this Court under Section 79 of the District Court Act. The plaintiff intends far more than a simple transfer. It is desired to use the action as a vehicle for a personal injuries claim.

Mr Davis concedes that steps taken to amend in the Magistrates Court to add the personal injuries claim were ineffective. A personal injuries claim instituted in the Supreme Court on 16 January 1998 has apparently been disposed of in such a way as to ensure the plaintiff does not come under criticism for pursuing the same cause of action in different Courts simultaneously.

It is ironic perhaps that it was probably concern with the changes brought about by the 1994 Act that led the plaintiff, Mr Mackay, and/or his solicitors to overlook instituting proceedings in respect of his personal injuries. A number of decisions have established that the new legislation imposes effective penalties against plaintiffs who come to Court too quickly and deprive insurers of their entitlement to notice in advance of action of claims and the opportunity to investigate those claims, make offers in respect of them and so forth.

I would assume that there would have been a personal injuries proceeding on foot but for that peculiarity of the legislation. The other peculiarity of it, at least compared with the former regime, is that it became compulsory to join the insurer as a defendant. Mr Mackay needs in this application to add a defendant out of time from the limitations stand point and to add a cause of action out of time from the limitations stand point.

The Rules of Court in particular Rules 23 to 25 as explained in authorities indicate that it can be done. In respect of additional parties in particular their joinder is typically back dated to some date before expiration of the limitation period, if not to the original commencement date. This is not a case in which the respondent which has mounted arguments in opposition to the application, namely FAI, represented by Mr Wilson, can argue prejudice.

It has known from an early date of the accident and the applicant's claim and proceeded as if litigation against it was, or would be, on foot.

After the expiry of the limitation period the plaintiff was examined by Dr Toft at the behest of FAI, although the request was made and agreed to before the limitation period expired. The accident led to Mr Cusack being injured and proceedings in which Mr Mackay or his compulsory third party insurer was, or might have become, a defendant. Apparently, in the course of working out Mr Cusack's claim, FAI offered to accept 60 per cent liability for the accident. On 21 January 1998 an offer to settle Mr Mackay's claim on the basis of a like apportionment was apparently made, but rejected. Offers went to and fro, including as late as March or even April 1998, by which time FAI's solicitors became aware that there were no proceedings on foot by Mr Mackay for damages for personal injuries and FAI withdrew any offers it had made.

Given that a plaintiff ordinarily has a year to serve proceedings, FAI might still not have been served with originating process claiming damages for personal injuries arising from the accident for Mr Mackay. The question ultimately is whether it makes a difference whether or not there has been an originating proceeding in the registry of a Court awaiting service. It could not be contended there's any prejudice to FAI. Lack of prejudice to a defendant is a relevant circumstance as the Chief Justice, then de Jersey J, noted in Grotherr [1991] 2 QdR 128. However, as Lee J noted in his judgment in the same case, the lack of prejudice to the defendant or prospective defendant is not a reason for depriving it of the protection of the Statute of Limitations.

The case has been ably argued and I have been reminded of authorities that are helpful such as Adam v. Shiavon [1985] 1 QdR 1, which may be seen as authorising the basic tactic of engrafting a personal injuries claim on a property damage claim arising out of the same accident.

I don't think it is necessary in the circumstances for me to go in any detail into Mr Wilson's argument that this is a case in which section 79 does not assist the plaintiff, particularly having regard to section 81.

Mr Wilson suggested Mr Mackay suffers embarrassment because his personal injuries claim is quantified, for present purposes, at about $53,000 and so, and could not properly be pursued in the Magistrates Court - a fortiori where it must share an award within the jurisdictional limit with the property damage claim.

In the unusual circumstances, I think it would not be an abuse for the plaintiff to use a “foot in the door” procedure of adopting the Adam v. Shiavon procedure with a view to getting a transfer to a Court of appropriate monetary jurisdiction somewhere down the line.

I do not wish to reject Mr Wilson's arguments under the District Court Act out of hand because, if the provisions are construed literally, they do pose some difficulty for the plaintiff if he has not presently a claim in respect of personal injuries in the Magistrates Court.

I was referred to Archie [1980] QdR 546 in which the Full Court considered that a plaintiff ought to be relieved of the consequences of an oversight in joining the third party in her action as a defendant as she clearly intended to do.

In this case FAI has not been a party in the litigation. I do not think that the active role it has taken in investigating the claim, making offers, requesting the plaintiff to be medically examined and so forth, comes near to putting it in the same position.

Mr Davis has also referred me to Bluewater Cover Pty Ltd v. Sykes, BC9703138, Court of appeal 4138 of 1997, 16 June 1997. That was a similar case in which a plaintiff injured in multiple accidents, but while working for an employer whose legal identify changed from time to time, omitted to sue those who employed him at the date of the first work accident in time. Partly on the basis that “behind the defendants stands WorkCover” the District Court Judge granted leave for the joinder of Messrs Barker and Kleinschmidt.

In Morris v. FAI General Insurance Company Limited [1996] 1 QdR 395, McMurdo DCJ, as her Honour then was, held that where the insurer had “accepted” liability (meaning 100 per cent liability) the principles of estoppel prevented its taking advantage of the plaintiff's failure to institute proceedings within the limitation period. The Court of Appeal rejected an appeal, but perhaps with some refinement of the legal basis for her Honour's decision.

It's common ground that exceptional or special circumstances, perhaps peculiar circumstances, have to be shown and that a convenient repository of the principles is Lee J's judgment already referred to.

In the end, I think Mr Wilson is right that the key to resolution of the present occupation is to be found in Lee J's judgment at 152. I'll set out in these reasons what his Honour said at page 152, lines 27 to 45:

Mr Davis assured me that no suggestion was made on behalf of his client that there had been any sharp practice or trickery or lulling into a false sense of security of the kind his Honour referred to earlier at page 152 in this case. It does appear to me this is a simple case of requirements of the Limitations legislation being overlooked. There is no prejudice to FAI. But that is not the basis on which the application has to be decided. It is most unfortunate that such care was taken at the outset to comply with the requirements of the 1994 legislation, but that they were overlooked when it really mattered.

It is common ground that it would be inappropriate, if FAI is not going to be brought into the proceedings as a defendant, to leave Mrs Cusack there facing a claim for damages for personal injuries when she might be at some risk of having no indemnity from an insurer or of having to fund the proceedings personally. I have been told from the Bar table that an insurer is looking after her interest in the property damage claim. The application is dismissed with costs, to be taxed.