Grigg v Rolfe Investments Pty Ltd
[1999] QDC 278
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- Grigg v Rolfe Investments Pty Ltd[1999] QDC 278
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Grigg v Rolfe Investments Pty Ltd[1999] QDC 278
Grigg v Rolfe Investments Pty Ltd[1999] QDC 278
DISTRICT COURT | Appeal No 3405 of 1999 |
APPELLATE JURISDICTION
JUDGE McGILL SC
CYNTHIA FAY GRIGG | Appellant |
and
ROLFE INVESTMENTS PTY LTD | First Respondent |
and
FAI GENERAL INSURANCE COMPANY LIMITED | Second Respondent |
Appeal No 3406 of 1999
Jason Ashley Crone | Appellant |
and
FAI GENERAL INSURANCE COMPANY LIMITED | Respondent |
BRISBANE
DATE 12/10/99
JUDGMENT
HIS HONOUR: In each of these matters the appeal is dismissed with costs.
I publish my reasons.
HIS HONOUR: I will make the costs including reserved costs.
So the orders will be that the appeals are dismissed with costs. That will mean costs to be assessed on the standard basis.
DISTRICT COURT | No 3405 of 1999 |
CIVIL JURISDICTION
JUDGE O'BRIEN
CYNTHIA FAY GRIGG | Applicant |
and
ROLFE INVESTMENTS PROPRIETARY LIMITED | First Respondent |
and
FAI GENERAL INSURANCE COMPANY LIMITED | Second Respondent |
No 3406 of 1999
JASON ASHLEY CROWE | Applicant |
and
FAI GENERAL INSURANCE COMPANY LIMITED | Respondent |
BRISBANE
DATE 23/09/99
JUDGMENT
HIS HONOUR: In this matter I had previously indicated thar I would grant leave to appeal subject to my ruling on the submission of counsel for the respondent that the applications are incompetent because no notice of appeal has been filed within the prescribed time of 28 days.
Counsel relied on cases such as Beggs v. Mellor (1969) Q.W.N. 44 and Re Bear (1996) 17 Queensland Law Reports 58. It should be noted that the decisions of the Stipendiary Magistrate in these matters were delivered on 17 and 18 August 1999 respectively, whilst the applications for leave to appeal were filed in this Court on 31 August 1999.
Pursuant to section 45(3) of the Magistrates Court Act the appellant must, within the time and in the way prescribed by the rules, give to the other party or the other party's solicitor notice of the appeal briefly stating the grounds of the appeal.
The decision in Re Bear was based upon the provisions of Rule 292 of the Magistrates Court Rules. Pursuant to that rule, the time prescribed for the filing of a notice of appeal with the Registrar of the Magistrates Court was 21 clear days of the date on which the judgment appealed from was delivered.
In that case leave to appeal was not sought until after the expiration of the 21 days, such that no notice of appeal was filed in accordance with the rule. The question which fell to be decided was whether the District Court had power to grant an extension of time to enable compliance with Rule 292.
The difficulty which confronted the applicant in that case was that Rule 309 of the Magistrates Court Rules expressly conferred the power to enlarge or abridge time upon a Stipendiary Magistrate. Consequently, through an application of the decision in Beggs v. Mellor, I held that this Court had no power to grant an extension of time for the filing of a notice of appeal.
Since that time the uniform Civil Procedure Rules have come into force. Appellant proceedings are now governed by Chapter 18 of the Rules, and Part 3 of Chapter 18 in particular applies to appeals to a Court other than the Court of Appeal.
Pursuant to Rule 785, the provisions of Part 1 of the chapter, other than Rules 753, 758, 766(3), 767, 776 and 777, apply with necessary adaptations to appeals under Part 3. The content of a notice of appeal, previously governed by Rule 292(1) of the Magistrates Court Rules, is now regulated by the combined provisions of Rules 747 (1) and 786(1).
Similarly, the requirements of Magistrates Court Rule 292(2) have been replaced by the combined requirements of Rules 746(2) and 748. The effect of these rules, read in conjunction with Rule 785, is that the notice of appeal must, unless the Court otherwise orders, be filed in the Magistrates Court Registry within 28 days after the date of the decision appealed from and be served as soon as practicable on all other parties to the appeal.
The rule makes it clear, in my view, that this Court now has the power to extend the time within which the notice of appeal must be filed. As indicated above, this was not the case under the old Magistrates Court Rules where the power to extend time lay exclusively with the Magistrates Court.
Moreover, under the uniform Civil Procedure Rules, it is no longer required, as it was under Rule 292(3) of the Magistrates Court Rules, that the notice of appeal be served upon the respondent within the same time frame as that which applied to the filing of the notice. Under the uniform Civil Procedure Rules, the notice must simply be served “as soon as practicable” on all other parties to the appeal.
For these reasons I consider that decisions such as Re Bear and Beggs v. Mellor are to be distinguished in their application to the circumstances of the present case. The Court has power to extend the time for the filing of the notice of appeal and it is not necessarily fatal to the appeal if leave is not obtained within the 28 days prescribed.
In this case, the applications for leave were filed in the District Court Registry, well within 28 days of the Magistrate's decision. In circumstances where the applicants have not been shown to be dilatory in prosecuting their applications, it is appropriate to grant any extension necessary to permit filing of the appeal.
In each case my orders are these. In each case I grant leave to appeal. In each case I extend the time for the filing of a notice of appeal by a period of seven days from today's date.
I make an order giving liberty to apply.
DISTRICT COURT OF QUEENSLAND |
REGISTRY: BRISBANE
APPEAL: 3405 OF 1999
CYNTHIA FAY GRIGG | Appellant: |
AND
ROLFE INVESTMENTS PTY LTD | First Respondent: |
AND
FAI GENERAL INSURANCE COMPANY LIMITED | Second Respondent: |
AND
REGISTRY: BRISBANE
APPEAL: 3406 OF 1999
JASON ASHLEY CROWE | Appellant: |
AND
FAI GENERAL INSURANCE COMPANY LIMITED | Respondent: |
JUDGMENT - McGILL D.C.J.
Judgment Delivered: 12 October 1999
Catchwords: | MOTOR VEHICLES – compulsory insurance – legislation – notice before action – leave to commence proceeding early not appropriate – Motor Accident Insurance Act 1994 s. 39(5)(c). Young v. Keong [1999] 2 Qd.R. 335 – applied Re: Tonks (No. 4695/98, White J, 24.6.98, unreported) – followed Carroll v. Ives (Plaint 1976/98, Wylie DCJ, 15.9.95, unreported) – distinguished |
Counsel for the Appellants: | R.J. Anderson |
Counsel for the Defendant: | K.F. Holyoak |
Solicitors for the Appellants: | Kenyons Lawyers |
Solicitors for the Defendant: | McInnes Wilson |
Hearing Dates: | 4 October 1999 |
DISTRICT COURT OF QUEENSLAND |
REGISTRY: BRISBANE
APPEAL: 3405 OF 1999
CYNTHIA FAY GRIGG | Appellant: |
AND
ROLFE INVESTMENTS PTY LTD | First Respondent: |
AND
FAI GENERAL INSURANCE COMPANY LIMITED | Second Respondent: |
AND
REGISTRY: BRISBANE
APPEAL: 3406 OF 1999
JASON ASHLEY CROWE | Appellant: |
AND
FAI GENERAL INSURANCE COMPANY LIMITED | Respondent: |
REASONS FOR JUDGMENT - McGILL, D.C.J.
Delivered the 12th day of October 1999
These two appeals were heard together and raise the same point. On consecutive days in August this year a Magistrate refused applications by the respective appellants under s. 39(5)(c) of the Motor Accident Insurance Act 1994 (“the Act”) for leave to bring a proceeding in a court for damages based on a motor vehicle accident claim. The appeals raise some general questions as to the issues which are relevant to the determination of an application for leave under that provision, and no doubt for that reason leave to appeal in each matter was given by His Honour Judge O'Brien on 30 September 1999. Before dealing with the relevant facts, I will say something about the scheme of the Act.
Scheme of the Act
The objects of the Act which commenced on 1 September 1994 include: “To encourage the speedy resolution of personal injury claims resulting from motor vehicle accidents”: s. 3(c). Part 4 of the Act deals with claims, and Division 3 deals with claims procedures. Division 4 deals with co-operation between claimant and insurer, Division 5 with rehabilitation, and Division 6 with proceedings in court. Most of the provisions relevant to this matter appear in Division 3.
By s. 37, a claimant who wishes to bring an action in a court for damages for personal injury arising out of a motor vehicle accident must first give written notice of the claim to the insurer setting out details of the claim, and including an offer of settlement (or sworn reasons why an offer of settlement cannot yet be made). The notice must be given within nine months after the accident or the first appearance of symptoms of the injury; if it is not given within this time, the obligation to give the notice remains, but the notice when given must contain an explanation for the delay. There are more stringent provisions dealing with the situation where the motor vehicle concerned cannot be identified, so that the claim is made against the Nominal Defendant: see Brannigan v. The Nominal Defendant (Appeal 5764/99, Court of Appeal, 24.8.99). There are also provisions relevant where there are two or more motor vehicles involved and two or more insurers, but it is not necessary to consider those.
Within one month after receiving notice of a claim, an insurer must give a notice stating whether the insurer is satisfied that notice has been given as required under the division, or if the insurer is not so satisfied, identifying the non-compliance and either waiving compliance or allowing the claimant a reasonable period specified in the notice to show that the requirements have been complied with or take reasonable action to remedy the non-compliance: s. 39(1). There is a mechanism for further steps to be taken which may ultimately lead to an application by a claimant to a court seeking a declaration that notice has been given as required, or that the claimant is taken to have remedied non-compliance: s. 39(5)(b). Again, those provisions do not arise for consideration at present.
Within six months after an insurer receives notice of a motor vehicle accident claim under the division, the insurer must investigate the circumstances of the accident and give written notice stating whether or not liability is admitted, and if admitted, whether admitted in full or part, and where the claimant has made an offer of settlement, either accepting or rejecting the offer: s. 41(1). As well, as soon as practicable after the insurer receives notice of a claim under the division, the insurer must make a fair and reasonable estimate of the damages to which the claimant would be entitled and make a written offer (or counter-offer) of settlement, or settle the claim by accepting an offer made by the claimant. There are further requirements as to what is to be contained in or accompany an offer or counter offer made by an insurer. There is also an obligation by an insurer and a claimant to whom a written offer or counter offer of settlement is made to respond in writing accepting or rejecting the offer within three months after receipt.
Section 39(5) provides as follows:
“A claimant may bring a proceeding in a court for damages based on a motor vehicle accident claim only if -
- (a)the claimant has given notice to an insurer who may be liable on the claim under the statutory insurance scheme as required under this division or the insurer has waived compliance with the requirement and
- (i)at least six months have elapsed since the notice or the waiver was given; or
- (ii)the insurer has denied liability on the claim; or
- (iii)the insurer has admitted liability but only in part and the claimant has given the insurer written notice that the extent of liability is disputed; or
- (b)the court, on application by a claimant dissatisfied with the insurer's response to a notice of a claim under this division, declares that -
- (i)notice of claim has been given as required under this division; or
- (ii)the claimant is taken to have remedied noncompliance with this division; or
- (c)the court gives lead to bring the proceeding despite noncompliance with requirements of this division.”
For reasons given earlier, paragraph (b) of the subsection is not relevant; the applications were made under paragraph (c). Once the action is commenced it is brought against the insured person and the insurer as joint defendants, unless the insured person cannot be identified or is dead or it is impracticable to serve that person: s. 52(1), (2).
Section 57 contains a provision altering a period of limitation: if a notice is given under s. 37, or an application for leave under s. 39(5)(c) is made before the end of the limitation period, which may be a period extended under Part 3 of the Limitations of Actions Act 1974, a proceeding in court based on the claim may be brought although the limitation period has ended, provided that it is brought within six months after the day on which the notice is given or leave to bring the proceeding is granted. Where an application for leave is brought in time, therefore, so long as leave is granted, there is an automatic extension of the limitation period until six months after the day on which leave to bring the proceedings is granted. If, however, the notice of the claim is given within the last six months of the limitation period, although the limitation period is extended until six months after the day on which the notice is given, unless leave is given under s. 39(5)(c), it is necessary for the claimant to wait until “at least six months have elapsed since the notice was given” before commencing proceedings under s. 39(5)(a), so this extension is of little or no use. It seems to follow from s. 38 of the Acts Interpretation Act 1954 that the first day upon which a claim could be brought in compliance with s. 39(5)(a)(i) is the day after the last day upon which a claim could be brought within s. 57(2), unless that day was a day when the relevant court registry were closed, in which case the limit under s. 57(2) would be extended until the next day on which the registry were open. This inconsistency appears anomalous, and I suspect it is a mistake. It follows that, if time is about to expire, it is important to ensure that the application for leave under s. 39(5)(c) is filed before the end of the limitation period: see Cowling v. Nelson [1999] 2 Qd.R. 231.
Mrs. Grigg
Mrs. Grigg was injured in a motor vehicle accident on 21 January 1999. On 16 April 1999, a notice under s. 37 was given by her solicitors. I have not seen a copy of the notice, but assume that it was in compliance with s. 37. The covering letter contained an offer to settle for $23,597.20, together with costs and outlays. Copies of medical reports were forwarded with the letter. By letter dated 25 May 1999, FAI General Insurance Co Ltd (“FAI”) advised that it had informed itself of the circumstances of the accident, and admitted liability in full. This, I think, complied with s. 41(1)(b) of the Act. By a letter dated 15 July 1999, FAI made a counter offer of settlement in the sum of $2,000 plus all statutory refunds, reasonable costs and outlays. That was arguably in compliance with s. 41(2) of the Act, although the offer scarcely set out in detail the basis on which it was made, and it was not accompanied by any material which would help the applicant to make a proper assessment of the offer. In any case, it was promptly rejected by letter dated 19 July 1999, which sought a “sensible response within seven days”. The following day FAI advised that it considered the offer “...commensurate with her injuries. We would invite you to give us a counter offer which you would consider commensurable.” The next step was the filing on 9 August 1999 of an originating application in the Magistrates Court seeking leave pursuant to s. 39(5)(c) of the Act to commence and prosecute proceeding for injuries suffered by the plaintiff. The application refers to leave “nunc pro punc” [sic], although I was told that no proceedings have yet been commenced. That application came on for hearing on 17 August 1999 when it was refused with costs.
Mr. Crowe
Mr. Crowe was injured in a motor vehicle accident on 8 March 1999. Notice under s. 37 was forwarded under cover of a letter from his solicitors dated 28 May 1999, which letter included an offer to settle in the sum of $12,500 plus costs and outlays. By a letter dated 25 June 1999, FAI advised that it had considered the circumstances of the accident and admitted liability in full. By a further letter of 28 June 1999, FAI offered to settle the claim for $2,412, including party and party costs, plus outlays. Some explanation for the quantification of the offer is contained in the letter. By a letter dated 30 June 1999, the solicitors for the plaintiff rejected this offer and sought “a satisfactory counter offer”. On 1 July 1999, FAI expressed the opinion that based on the medical evidence at hand, the offer was reasonable, expressing surprise that no counter offer was included in the letter, and asking whether the claimant's solicitors were serious about continuing meaningful negotiations. A reply merely threatened to commence proceedings, and without further notice. An originating application seeking the same relief was filed in the Magistrates Court on 28 July 1999, and came on for hearing on 18 August 1999 before the same Magistrate, where it suffered the same fate.
Reasons for The Decision
Reasons for the decisions are recorded by the Magistrate on the court file. In relation to Mrs. Grigg, the Magistrate noted that the parties “are poles apart in their negotiations on quantum” but said that he personally felt that “there is further room for negotiation”, and referred to the objects of the section and the fact that a relatively simple matter should not be allowed to degenerate into a costs generating exercise when further negotiations may prove of some benefit. It was submitted on behalf of the respondent that this was a finding that the parties had not exhausted negotiations in relation to the claim, but I think that it would be more appropriate to read the reasons as a conclusion that it would be better for the parties to negotiate further about the claim before commencing proceedings, even though the negotiations to date had been unsuccessful, possibly because either or both of the parties were not approaching the matter seriously enough. In my opinion, such approach is one which is plainly open on the evidence.
In the matter of Crowe the following day, the Magistrate noted that it was a simple soft tissue injury and made some comments about the contents of a report from Dr. Pentis, and said that he was of the view that FAI had not completely shut the door on further negotiations. He accepted the claimant was not required to make a counter offer but was mindful of s. 3(c) of the Act. He went onto distinguish the decision of His Honour Judge Wylie in Carroll v. Ives (Plaint 1976/95, 15 September 1995, unreported) on the ground that in that matter proceedings had already been commenced. He said that no special circumstances had been demonstrated by the claimant and he was of the view that there was still further room for negotiation, and dismissed the application. It may be that on this occasion the finding was that the parties were not necessarily implacably divided on the issue of quantum, although I suspect that there is still an element of acknowledgement of the desirability of continued negotiations in the hope that they may be fruitful.
The Arguments On Appeal
It was common ground before me that the matter fell within s. 39(5)(a)(i), so that a proceeding could be commenced once at least six months had elapsed since the s. 37 notice was given. The question was whether the court should give leave to bring the proceeding despite noncompliance with the division, where if leave were granted and the proceeding were brought within the six month period, the only aspect of noncompliance would be with the requirement for six months to elapse after the notice was given. It was submitted on behalf of the appellant that the purposes of giving the notice had been fulfilled, in that FAI had had the opportunity of considering the circumstances of the accident and had admitted liability, and indeed had made the offer contemplated by s. 41(2), so that there was nothing further to be done which was required by the Act. In these circumstances, preventing the claimant from issuing a proceeding at once was simply imposing an unnecessary delay on the claimant which would serve no useful purpose, something which was actually contrary to the objective in s. 3(c) of encouraging a speedy resolution of these claims.
It was argued on behalf of the appellants that the complexity of the matters to be resolved between the parties, the parties' capacity to reach a negotiated settlement, costs implications, and dispute resolution procedures not required by law were extraneous or irrelevant considerations the Magistrate had taken into account but should not have. In my opinion, all of these matters are matters properly to be taken into account, although I would prefer to express the fourth as the fulfilment of the objective of having the matter resolved by negotiation if possible, even though this might involve the parties in taking more steps than are actually compelled by statute. A court is entitled to take the view that it is desirable that there be further negotiations even if that is not actually required by the statute.
It was also argued that the purpose of the six month delay was simply to enable the steps contemplated by s. 41 to be carried out, and that once that occurred there was no good purpose in delaying the commencement of proceedings further. In my opinion, that is too narrow an interpretation of the objective of s. 37, and I prefer the broader approach expressed in Young v. Keong [1999] 2 Qd.R. 335. In that case, McPherson JA noted at p. 337 that:
“The underlying policy of provisions like s. 37 of the Act is, broadly stated, to force the claimant toward negotiating a settlement of the claim before bringing an action “in a court” for those damages. One of the objects of the Act expressed in s. 3(c) is to encourage the speedy resolution of such claims.”
I do not think it is appropriate to approach s. 37 on the basis that the six month period serves no useful purpose once the steps actually required by s. 41 have been taken without resolving the claim. This argument does not in any case sit well with the assertion that the insurer had not in these matters made a reasonable attempt to settle by offering reasonable amounts, a proposition which is tantamount to saying that the requirements of s. 41 had not been complied with because the insurer had not made a fair and reasonable estimate of the damages to which the claimant would be entitled; but this is not a step the insurer is actually required to take during the six month period, merely “as soon as practicable”.
It was also argued that the fact that the insurer's offers were unreasonably low was another circumstances tending to support the grant of leave. The respondent probably thought that the appellants' offers were unreasonably high, and I suspect that a reasonable amount for settling each claim lies somewhere between the two, but I have no intention of commenting on which party I think is being more unreasonable. In my opinion, a court should not attempt an instant assessment of quantum of a claim for the purpose of dealing with an application of this nature. The material available is necessarily very limited, and any sort of assessment which could be made could well have a large margin of error. I think it would be undesirable for an application for leave under para. (c) to turn into a mini quantum trial, just in order to determine whether one party is being unreasonable in the negotiations. In my opinion, it is undesirable and inappropriate for the court to form any views as to a reasonable figure for which the claim should be settled, or the reasonableness of either party's offer.
The Authorities And Precedents
Reliance was placed on the decision of the Court of Appeal in New South Wales in Taylor v. Franciof (1990) 19 NSWLR 444. The court considered a similar but somewhat different provision of the Motor Accidents Act 1988 in that State, where the question was whether the insurer had denied all liability in respect of the claim. Where that occurred under the NSW Act, a proceeding could be commenced without waiting for six months from the notice of the claim. In that case, the claimant had been paid an amount in respect of a “transcover” claim, and when a claim for damages under the Motor Accidents Act 1988 was lodged, the insurer advised that payment of compensation under that Act would not be made because the compensation paid in respect of the transcover claim exceeded the entitlement to damages under the Act. The issue before the Court of Appeal was whether that amounted to a denial of all liability in respect of the claim, the plaintiff having commenced his action without waiting for the six month period to expire.
Handley JA, with whom the Chief Justice and the President agreed, said at p. 447 that the letter from the insurer denied all liability under the new Act, although for reasons going to the quantum of damages recoverable rather than for reasons going to legal responsibility for the claimant's injuries, and continued:
“The evident purpose of s. 52 is to delay the commencement of legal proceedings to require and enable the parties, if possible, to negotiate an overall settlement. The section thus compliments s. 45(1) which imposes a duty on insurers to endeavour to resolve claims, by settlement or otherwise, as expeditiously as possible. ... The exception in s. 52(2)(a) reflects the view that no good purpose is to be achieved by delaying the commencement of legal proceedings once it is clear, as the Chief Justice put it during argument, that the claimant has a fight on his hands, if he wants to recover anything in respect of his claim. The GIO's letter put an end to all negotiations. It informed the plaintiff's solicitors in the clearest terms that he had a fight on his hands. ... Of course, a dispute as to quantum alone will not ordinarily satisfy the requirement of s. 52(2)(a) but in this case it does. This claimant was informed by the GIO that in its view, based on its assessment of the quantum issue, the claimant should recover nothing under the new Act. In my judgment therefore, the letter satisfied the provisions of s. 52(2)(a) of the new Act... .”
It followed that the action had not been commenced prematurely.
If a situation arose in Queensland where an insurer, although admitting liability on a claim, denied any obligation to make any payment in respect of the claim on the basis that the plaintiff had suffered no damages, or on the basis that the plaintiff had already received compensation for those damages in a way which would reduce the damages payable at common law if the claim were litigated, Taylor would be authority in support of the view that s. 39(5)(a)(ii) applied. But that is not the situation here.
Carroll v. Ives was decided in September 1995, about one year after the Act commenced. In that case the plaintiff had commenced an action on 4 August 1995, in respect of a collision which occurred on 3 November 1994. The plaintiff had given a notice in purported compliance of s. 37(1) of the Act on 18 April 1995, and liability was admitted, but negotiations were unsuccessful and the plaint was presented before the expiration of the six month period. The plaintiff then sought to remedy the noncompliance by applying for leave under s. 39(5)(c). Leave was given, and reference was made to four considerations:
- (i)the insurer had made in July what his Honour regarded as “its final offer”;
- (ii)the claimant had not sought to take negotiations further but had commenced proceedings promptly;
- (iii)“in such circumstances, nothing will be achieved by compelling the plaintiff to commence fresh proceedings and again serve the defendant and so incur additional expense.
- (iv)the insurer could protect itself by making offers to settle under the District Court Rules, or indeed by making a Calderbank offer.
His Honour referred to Taylor (supra) but noted that in the end it was no assistance to him since the problem in that case, like the problem in this, was that there was a dispute as to quantum alone. His Honour was satisfied there that the plaintiff and the insurer now had a fight on their hands and that no purpose would be achieved by delaying a commencement of the litigation, and gave leave nunc pro tunc.
The proposition that leave nunc pro tunc can be given is supported by the decision of Wilson J in McKelvie v. Page [1999] 2 Qd.R. 259. Unless leave is given, an action commenced contrary to s. 39(5) ought to be struck out: Young v. Keong (supra).
There have been a number of other decisions which I have been able to locate of the Supreme or District Court dealing with applications under s. 39(5)(c), but none of them deal with a situation where it would be open to the claimant to wait until the six month period has expired, and the only purpose of the application is to avoid the necessity to have to wait. In the case of all of the applications where leave has been granted, the consequence of a refusal of leave would have been that the mandatory provision of the Act would have operated so as to prevent the plaintiff from litigating the claim at all. Obviously in such a situation the approach to the grant of leave raises different considerations. Leave has been granted where a notice was not given under s. 37 prior to the commencement of a claim for damages for loss of consortium in circumstances where the claimant's legal advisors did not think that it was necessary to give a notice in respect of such a claim: Hardacre v. Johnson (Plaint 5102/97, Forde DCJ, 23.1.98) and where the notice had been given after the nine month period, liability had been denied, the claimant had so far as possible remedied any default but could not remedy the failure to give the notice within the time required, and it was not suggested that the insurer had suffered any prejudice as a result of the delay: McAuley v. Tradelink Plumbing Supplies (Plaint 2666/98, Brabazon DCJ, 5.2.99).
Analysis
In my opinion, the arguments advanced on behalf of the appellant, if adopted, could well frustrate the legislative policy embodied in the imposition of the six month period in s. 39(5)(a)(i). It would still be necessary to wait until the insurer had admitted liability under s. 41, and to wait until the insurer had rejected the offer of settlement accompanying the claim, but so long as that point had been reached, a claimant could simply say that, because that offer had been rejected and it was what the claimant really wanted in order to settle the claim, the claimant and the insurer had a fight on their hands, and there was no point in delaying for the period of six months. If the insurer had made a counter offer which was also rejected, that would strengthen the argument, but in principle it could be advanced so long as the initial offer had been rejected.
The issue in this case is rather how soon can a claimant become a plaintiff. If the legislature had regarded the failure of some attempt at settlement as being sufficient, it could easily have provided to that effect, but it has not done so. It has imposed a six month waiting period, although giving the court power to dispense with that period. Plainly however the statute contemplates that in the ordinary case a six month waiting period should be complied with, and in my opinion it is necessary for a claimant seeking leave to commence proceedings to show some good reason why that claimant's proceedings should be exempted from the general restriction imposed by s. 39(5)(a). In this I respectfully agree with and follow the analysis of White J in Re: Tonks (No. 4695/98, 24.6.98, unreported). In circumstances where the only consequence of allowing the statute to take its course is that the claimant is made to wait until six months from the time when the notice is given before commencing proceedings, it is difficult to see how the claimant will suffer much or any prejudice as a result of this delay, at least in the ordinary case.
If the effect of the delay were to take the plaintiff beyond the end of the limitation period of course the position would be different, but that is not this case. Some other form of prejudice may arise in a particular case which would have to be considered on its merits. Even the delay in receiving the final amount of the judgment is not much prejudice, because interest is commonly awarded in respect of the period between the date when the loss is suffered and the date when judgment is given, and that would compensate the plaintiff for any delay at this point. Overall, it is very difficult to see how in the ordinary case a plaintiff is disadvantaged in any practical sense. There is the theoretical disadvantage of course that a plaintiff who has a cause of action is prevented from pursuing that cause of action in a court of law, but I do not think that too much weight should be attributed to this factor in circumstances where it is a mere temporary obstacle, in the absence of some practical consequence. This is different from a legislative provision which destroys rights, considered in Winsor v. Boaden (1953) 90 CLR 345 at 347. In any case, so far as the plaintiff's right to litigate has been interfered with, that was done by the legislature, and I think it would be a wrong approach for a court when considering an application for leave under para. (c) to seek to use that power to interfere with the general operation of para. (a), even if that paragraph does interfere with the ordinary right to litigate a cause of action.
In the present case the applicant's solicitors swore to an opinion that there were reasonable prospects that the plaintiff would be entitled to an award greater than what had been offered by FAI. In my opinion, that is quite inadequate as a justification for a grant of leave under para. (c). Mrs. Grigg is in her early seventies, but it was not suggested that there is any particular reason arising out of her health or medical condition which would cause any significant prejudice to her as a result of having to wait until the six month period has expired. If she were dying of cancer, for example, the situation would be quite different. By the time the application was heard, she had only about two months to wait before proceedings could be issued anyway.
It also seems to me that it is coming to be recognised that it is in the public interest for parties to a dispute to attempt to resolve that dispute by negotiation before resorting to a court to resolve it through litigation, and that the public interest is served by encouraging parties to make serious attempts to resolve disputes by negotiation rather than rushing into court. It seems to me that this public interest is reflected in the objective of these provisions identified by McPherson JA in Young (supra) at p. 337, and the similar purpose of the NSW provisions identified by Handley JA in Taylor (supra) at p. 447. Insofar as the Magistrate in the present case was telling the parties to make further attempts to negotiate the matter before commencing proceedings, that in my opinion is an approach entirely consistent with that objective and the public interest.
It must also be remembered that the Uniform Civil Procedure Rules are framed on the basis that a plaintiff is expected prior to commencing the action, and a defendant is expected prior to filing a defence, to be much better prepared, particularly in terms of the detail of the claim and response than was ordinarily expected under the previous rules. This is shown by the greater detail which is now required to be set out in a Statement of Claim and Defence. This, in my opinion, is consistent with the general approach that parties are not encouraged to rush into court; certainly plaintiffs are not encouraged to rush into court unless they have carefully thought through just what they are claiming and how it can be justified.
It also seems to me that in Carroll (supra) his Honour proceeded on the basis that there was no prospect of the matter being resolved by negotiations if the parties were given more time. That is plainly a relevant consideration, and may well in an appropriate case justify a grant of leave, although obviously different views can be taken about the desirability of encouraging further negotiations even if the parties appear to be intransigent. The court cannot force parties to negotiate, but by forcing a plaintiff to wait until the six month period expires, the parties are certainly given every opportunity to negotiate.
It may be that in an appropriate case it would be possible to show that there had already been a serious attempt at negotiating a settlement which has been unsuccessful, so that a court could be satisfied that it really would be a waste of time allowing more time for negotiations, but I think that this would not usually provide any justification for giving leave, unless perhaps there was some particular reason to think that negotiations would not be successful in a particular case, for example where an insurer was determined to rely on a particular point which if successful provided a complete defence, and was therefore necessarily unwilling to make any offer of settlement (assuming that such a case would not fall within the principle in Taylor (supra).) There may be an analogous situation in relation to quantum, for example where there is a dispute as to whether particular serious consequences were caused by the accident, and hence compensable, where the parties might be necessarily implacably divided. In my opinion, a court should be reluctant to accept the conclusion that further attempts to negotiate a settlement will be a waste of time, but if it is clear that that is the case, and the operation of para. (a) would produce significant delay in pursuit of the plaintiff's claim grant of leave may be justified under para. (c). In my opinion, that is clearly not either of these cases.
I think there is some force in the argument on behalf of the respondent that, if applications for leave were to be granted routinely so long as the minimum requirements of s. 41 had been complied with, or there had been an exchange of offers without settling the matter, this would reduce the scheme of the Act to a mindless ritual which would not encourage meaningful negotiation. One may add that if insurers were concerned about applications of this nature being allowed too readily just to enable proceedings to be commenced within the six month period, they may seek to avoid such a consequence by delaying responding as required by s. 41 (1) until the six month period had almost expired. It seems to me desirable that insurers respond as soon as they conveniently can, and it would be undesirable to adopt an approach to applications of this nature which might give rise to what could be seen by insurers as a detriment from such expedition.
There is also, I think, a public interest in minimising the cost of litigation, and one way of doing that is by avoiding unnecessary applications. One practical consequence of a successful application in the present case would have been to increase the cost of the proceeding by the cost of that application. It would have led to the incurring of additional legal costs which could have been avoided had the claimant simply waited until the six month period had expired; this, I think, stands in marked contrast to the position in Carroll (supra) where a desire to minimise legal costs supported the granting of leave. That consideration is made more significant by the application of the ordinary approach that a party seeking an indulgence from the court, in this case under para. (c), should pay the costs of the application; this occurred in Leashon v. Sekulla (Plaint 193/98, Boulton DCJ, 4.9.98, unreported).
In my opinion, it is necessary for a plaintiff applying for leave under para. (c) to show that there is some good reason why the ordinary course contemplated by the statute, that proceedings not be commenced until six months after the notice has been given, should not be followed in the particular circumstances of the case. The justification in my opinion should concentrate on the practical consequences of the delay. In my opinion, the mere fact that offers have been exchanged and the parties are a long way apart is not sufficient justification, even in combination with a desire on the part of the claimant to proceed to litigation without first negotiating further. Such an attitude is, in my opinion, inconsistent with the objective of this part of the Act, and far from justifying a grant of leave, it is the sort of approach which the statute was intended to overcome.
One other undesirable feature of this application is that the offer and counter offer made in each case have now been disclosed in documents which form part of the record of the Magistrates Court and the District Court. That was inevitable given the basis upon which the application was made, but it does mean that now there is one Magistrate who would have to disqualify himself from hearing either of these trials because he was aware of the amounts offered by the respective parties. The fact that documents remain on the District Court file would not, I think, be a particular problem since the proceedings will presumably be tried in the Magistrates Court, and even if the matter came before the District Court there is no reason why the appeal files should be shown to the judge. I would expect that when proceedings issue in the Magistrates Court they will do so in a separate file, and would hope that the files relating to the originating applications which produced the orders subject to appeal are not shown to any Magistrate who has to deal with the actions, but I do not think that I have jurisdiction to make any order about how a Magistrates Court file should be dealt with. I think it clear that any Magistrate who became aware of the content of the offers which had been exchanged in relation to one of these matters could not hear the trial of that matter and would have to disqualify himself or herself. Apart from saying that, however, I do not think there is anything I can or should be doing about the state of the files. I will omit reference to the actual amounts in these reasons, apart from the copies provided to the parties and placed in the file.
In my opinion, the Magistrate in the present case was justified in taking the view that the parties should negotiate further rather than proceed to litigation. Far from differing from the approach adopted by the Magistrate, I would entirely endorse it. In each case the appeal is dismissed with costs. The same solicitors appeared for both appellants, and I assume that in fact the costs of the appeal will be borne by the solicitors rather than by the individual claimants.
Counsel for the appellant: | R.J. Anderson |
Counsel for the respondent: | K.F. Holyoak |
Solicitors for the appellant: | Kenyons Lawyers |
Solicitors for the respondents | McInnes Wilson |
Date of Hearing: | 4 October 1999 |