Pauline Emily Martin v Molluso Enterprises Pty Limited [1994] ACTSC 107 (13 October 1994)

SUPREME COURT OF THE ACT

PAULINE EMILY MARTIN v. MOLLUSO ENTERPRISES PTY LIMITED
No. SC408 of 1994
Number of pages - 6
Limitation of Actions

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
HIGGINS J

CATCHWORDS

Limitation of Actions - motor accidents - occurring in New South Wales - whether action barred by New South Wales legislation - consideration of limitation law to be applied whether a New South Wales court would grant leave to commence proceedings out of time.

Motor Accidents Act 1988 (NSW), ss.42, 43, 50, 52
Limitation Act 1985 (ACT), ss.36, 56, 57

Breavington v Godleman [1988] HCA 40; (1989) 169 CLR 41
McKain v R W Miller and Company (South Australia) Pty Limited [1991] HCA 56; (1991) 174 CLR

1

Stevens v Head [1993] HCA 19; (1993) 176 CLR 433
Goryl v Greyhound Australia Pty Ltd [1994] HCA 18; (1994) 179 CLR 463
Rose v Kwow (unreported, Supreme Court, ACT, Higgins J, 2 September 1994)
Salido v Nominal Defendant (NSW) (1993) 32 NSWLR 524

HEARING

CANBERRA, 16 September 1994
13:10:1994

Counsel for the Plaintiff: Mr G Parker

Instructing solicitors: Gary Robb and Associates

Counsel for the Defendant/
Third Party Insurer: Mr R Mildren

Instructing solicitors: Hunt and Hunt

ORDER

THE COURT ORDERS THAT: Leave be granted to the plaintiff to commence proceedings in this matter.

DECISION

HIGGINS J On 6 July 1994, the plaintiff lodged a writ of summons with this Court. It sued upon a cause of action arising on or about 10 October 1989. The plaintiff alleged that she was a passenger in a taxi which negligently drove into the rear of another motor vehicle, on the Pacific Highway, Artarmon in the State of New South Wales. This accident is alleged to have caused, inter alia, whiplash injury to the plaintiff. The effects of that injury are set out in the statement of claim annexed to the writ.

2. She was, at the time of the accident, travelling in the course of a work related journey. She applied for and was granted workers compensation. She became concerned when the workers compensation insurer, QBE Insurance Ltd, declined to pay for further treatment expenses and so consulted her present solicitors. Her first consultation with these solicitors was on 21 February 1994.

3. She had, in November 1990, sought legal advice as to her prospects for succeeding in a common law claim. The advice given to her was that she would be unlikely to succeed. As a result she did not further pursue such a claim until that recent consultation when further and different advice was given to her.

4. The original advice was given in writing. In essence, that advice was to the effect that her claim was barred by virtue of s.42 of the Motor Accidents Act 1988 (NSW) (the MA Act).

5. It is true that s.42(1) of the MA Act imposed a duty on a person in the position of the plaintiff:

... to ensure that a report of the motor accident concerned is made to
a member of the Police Force ... within 28 days after the date of the
accident.

6. The plaintiff, then an ACT resident, was not aware of that obligation. The circumstances of the accident were such, however, that it was very likely that the accident would have been reported to police by one or both of the drivers concerned. No check was made by the solicitors, it seems, as to whether a report had been made.

7. In any event, the advice seemed to overlook the following sub-sections of s.42:

(4) If a person commences proceedings in respect of a claim without
having complied with the duty under this section, the person must
provide a full and satisfactory explanation to the court for the
non-compliance.
(5) If the court is satisfied that sufficient cause existed to justify
the delay in making the report and that a report of the accident was
made within such period as the court considers reasonable, having
regard to the duty under this section, the court may allow the
proceedings to continue.

8. The purpose of the section is to avoid possible prejudice to insurers arising from a lack of contemporary corroboration of the circumstances of any accident giving rise to a claim. It would also provide a means for ensuring that the alleged accident was a genuine event.

9. A report emanating from the taxi driver or the other driver would satisfy those objectives. Section 50(2) of the MA Act had, in any event, imposed a duty on the taxi driver to notify the taxi's insurer.

10. Granted her understandable ignorance of New South Wales' law, it is unlikely that a full explanation of the plaintiff's failure herself to report the accident to police within the 28 day period would have been rejected as unsatisfactory.

11. There was another non-compliance as at November 1990. Pursuant to s.43(1)(a), the plaintiff was obliged to give notice of her proposed claim to the proposed defendant and the third party insurer of the proposed defendant within six months from the date of the accident.

12. However, a late notification is permitted by s.43A(1) of the MA Act, subject to a requirement that a "full and satisfactory explanation of the delay be given to the third party insurer".

13. Pursuant to s.43(4), a court may strike out proceedings in relation to a claim if satisfied that there is no such explanation.

14. The solicitor correctly advised the plaintiff that an acceptable explanation did seem to be available but he pointed out that the failure to comply with s.42 made it "unlikely that the claim would be accepted at this stage".

15. He also expressed doubt as to whether the damages threshold of $15,000.00 would be significantly exceeded.

16. The advice given was unduly negative. It also gave the incorrect impression that s.42 of the Act provided an insuperable barrier to the plaintiff's claim. No consideration seems to have been given, in any event, as to whether the notice requirements would have bound a court of this Territory in an action brought in the Territory as is the present action. However, no criticism can be levelled at the plaintiff for accepting the advice then given to her.

17. There has, of course, been some delay in commencing proceedings after 21 February 1994. That delay has been due to difficulty experienced by the plaintiff's solicitors in obtaining details of the ownership of the allegedly negligently driven taxi.

18. Following service of the writ of summons herein, a letter was received from solicitors for the defendant, dated 1 August 1994 raising the possibility that the defendant would contend that these proceedings were "a nullity". On 16 August 1994, they wrote as follows:

We have now had the benefit of counsel's advice in this matter.
We are satisfied that the current proceedings are invalid under

Section

52(4) of the Motor Accidents Act as applied by Section 57 of the ACT
Limitations Act. In the circumstances, we are instructed to invite
your client to discontinue these proceedings and we are further
instructed to seek no order as to costs incurred by the defendant to
date.
If it is the case that proceedings are not discontinued within 7 days
of the date of this letter, we are instructed to proceed with an
application to strike out the writ and in that event, we shall be
seeking an order for costs.

19. Undeterred by this, the plaintiff applies to this Court for leave to "commence proceedings pursuant to s.42(4) of the Motor Accidents Act (NSW)".

20. By reason of the fact that this accident occurred in the state of New South Wales, the substantive law to be applied is the law of that State: Breavington v Godleman [1988] HCA 40; (1989) 169 CLR 41.

21. The limitation laws of the place of the tort are, however, to be regarded as procedural. It follows that, apart from legislation, the provisions of the MA Act as to notice and as to the time within which an action may be commenced, do not apply to an action validly commenced in this Territory: McKain v R W Miller and Company (South Australia) Pty Limited [1991] HCA 56; (1991) 174 CLR 1.

22. Although it would not have been known in 1990, it is now to be accepted that the limitation on the assessment of damages imposed pursuant to the MA Act is also to be regarded as procedural: Stevens v Head [1993] HCA 19; (1993) 176 CLR 433; Goryl v Greyhound Australia Pty Ltd [1994] HCA 18; (1994) 179 CLR 463.

23. Under the Limitation Act 1985, as it existed before 30 November 1993, it would have followed that the limitation period applicable to the plaintiff's action was six years. It would, therefore, not have expired until 10 October 1995.

24. Had the action commenced in New South Wales, however, the MA Act would have provided a special period of limitation in respect of claims made under the MA Act:

52. (1) A claimant is not entitled to commence court proceedings
against another person in respect of a claim until 6 months have
elapsed since notice of the claim was given to the other person and

(if

required by section 43(4)) to the other person's insurer.
(2) If notice is given to the other person's third-party insurer then
despite subsection (1) the claimant is entitled to commence court
proceedings if any of the following occurs:
(a) the insurer denies all liability in respect of the claim;
(b) the insurer admits partial liability in respect of the claim but
the claimant is dissatisfied with the extent to which liability is
admitted;
(c) in the case of a late claim within the meaning of section 43A, the
insurer rejects the claimant's explanation for delay in making the
claim.
(3) If a claimant commences proceedings in respect of a claim more

than

12 months after the date on which the claim is made, the claimant must
provide a full and satisfactory explanation to the court for the

delay.

(4) A claimant is not entitled to commence proceedings in respect of a
claim more than 3 years after the date on which the claim must be made
in accordance with section 43 except with the leave of the court in
which the proceedings are to be taken.
(5) The Limitation Act 1969 does not apply to or in respect of
proceedings in respect of a claim.

25. The period of limitation prescribed by s.52(4) expired on 10 April 1993.

26. However, the bar raised by s.52(4) is not absolute. It may be waived if the court grants leave to do so.

27. A consideration of the effect of s.52(4) is made necessary by reason of s.56 of the Limitation Act 1985 (ACT). The effect of that section is that, as from 30 November 1993, the limitation law to be applied to the entitlement of a party to commence a proceeding in this Court is that of the jurisdiction, being a State or Territory of Australia or New Zealand, the substantive law of which applies to the cause of action sued on: Rose v Kwow ( unreported, Supreme Court, ACT, Higgins J, 2 September 1994).

28. Section 57 of the Limitation Act empowers the Court to exercise any discretion under that extra-Territorial limitation law enabling extension or waiver of any such time bar in the same manner as that discretion would be exercised by the courts of that other place.

29. I have, therefore, to decide whether a court of the State of New South Wales would grant leave for this plaintiff to commence proceedings notwithstanding the expiry of the time limited by s.52(4) of the MA Act.

30. The New South Wales Court of Appeal considered that question recently in the case of Salido v Nominal Defendant (NSW) (1993) 32 NSWLR 524. Gleeson CJ, at 532-533, approved the following guidelines for courts in New South Wales exercising the discretion conferred by s.52(4):

1. Section 52(4) confers a discretion which is to be exercised
judicially, in a manner that furthers the purposes of the statutory
context in which it appears. The immediate purpose, as with any
limitation period, is to protect defendants against the injustice of
stale claims; the statute is also aimed at promoting forensic
diligence.
2. Bearing in mind those statutory purposes, the question is whether,
in the circumstances of each individual case, the applicant for leave
has demonstrated that it is fair and just that leave should be

granted.

3. The diligence, or lack of diligence, shown by a plaintiff or a
plaintiff's representatives, in ascertaining and asserting his or her
rights will ordinarily be a material factor, as will the extent of the
relevant delay, and the reason for it.
4. The nature and extent of any forensic disadvantage to a defendant
resulting from a plaintiff's delay will also be material. The effect,
if any, of the delay upon the defendant's ability to defend an action
is a matter to be taken into account, and may in some cases be of
decisive importance.
5. Leave under s.52(4) may be refused if it would be plainly futile to
grant it, and in that connection an applicant's willingness and

ability

to give a full and satisfactory explanation of any delays in reporting
to police, notifying claims and commencing proceedings will be
material.

31. Kirby P expounded a similar series of "guiding principles". Powell JA summarised those more extensive guidelines in the following terms at 541:

1. whether a sufficient explanation has been given for the failure to
commence proceedings in time; and
2. if so, whether, having regard to all the circumstances of the case,
it is fair and just to grant, or to refuse, the application.

32. I can see no substantive difference between the approach to the exercise of the discretion conferred by s.52(4) of the MA Act and that conferred by s.36 of the Limitation Act 1985 (ACT).

33. The plaintiff's explanation for delay has already been noted. It is not unsatisfactory. The delay itself is not so gross that it should disentitle the plaintiff from having an extension of the time prescribed. There is no prejudice to the defendant save that it will be denied the defence otherwise available. In my view it is fair and just to grant the application.

34. Accordingly, it is ordered that leave be granted to the plaintiff to commence proceedings in this matter.

35. I will hear the parties as to costs.