Pulido v Rs Distributions Pty Ltd & Ors [2003] ACTSC 61 (1 August 2003)

Last Updated: 15 August 2003

PATRICK PULIDO v R S DISTRIBUTIONS PTY LTD and VISTA LASER EYE CLINICS PTY LTD; JANICE PARKER and RONALD BINETTER

[2003] ACTSC 61 (1 August 2003)

EXTENSION OF TIME TO COMMENCE PROCEEDINGS - limitation period not expired under ACT law - conflicts of laws - place of tort and causes of action - proper law of contract - application of NSW limitation period to ACT proceedings - criteria to determine exercise of discretion to extend time period.

ALLEGED NEGLIGENCE - personal injury - failure to warn - misrepresentation as to possible effects of laser eye surgery - alleged breach of Trade Practices Act 1974 (Cth), Fair Trading Act 1987 (NSW), Fair Trading Act 1992 (ACT) and breach of contract.

Trade Practices Act 1974 (Cth), s 52, s 82(2)

Fair Trading Act 1987 (NSW), s 11(1), s 36, s 56, s 57

Limitation Act 1985 (ACT)

Fair Trading Act 1992 (ACT), s 18A, s 60C(2), s 60E(1)(a)-(h)

Limitation Act 1969 (NSW)

John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; (2000) 203 CLR 503

Breavington v Godleman [1988] HCA 40; (1988) 169 CLR 41

Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458

Jacobs v Australian Abrasives Pty Ltd [1971] Tas SR 92

Buttigeig v Universal Terminal & Stevedoring Corporation [1972] VR 626

Macgregor v Application des Gaz [1976] Qd R 175

Sydbank v Soenderjulland A/S Bannerton Holdings (1996) 68 FCR 539

Mendelson - Zeller Co Inc v T & C Providores Pty Ltd [1981] 1 NSWLR 366

Pederson v Young [1964] HCA 28; (1964) 110 CLR 162, 166-7

McKain v R W Miller & Co (SA) Pty Ltd [1991] HCA 56; (1991) 174 CLR 1, 42-4

Gardner v Wallace [1995] HCA 61; (1995) 184 CLR 95

Mason v Murray's Charter Coaches and Travel Services Pty Ltd [1998] FCA 1430 (2 November 1998); [1998] FCA 1430; 88 FCR 308; 159 ALR 45

Salido v Nominal Defendant (1993) 32 NSWLR 524 (CA)

No. SC 246 of 2002

Judge: Higgins CJ

Supreme Court of the ACT

Date: 1 August 2003

IN THE SUPREME COURT OF THE )

) No. SC 246 of 2002

AUSTRALIAN CAPITAL TERRITORY )

BETWEEN: PATRICK PULIDO

Plaintiff

AND: R S DISTRIBUTIONS PTY LIMITED ACN 078 936 740

And

VISTA LASER EYE CLINICS PTY LIMITED ACN 071 536 966

First Defendants

AND: JANICE PARKER

Second Defendant

AND: RONALD BINETTER

Third Defendant

ORDER

Judge: Higgins CJ

Date: 1 August 2003

Place: Canberra

THE COURT ORDERS THAT:

1. The extension of time sought be granted, and time period extended to the extent necessary to pursue the causes of action arising under the law of New South Wales in respect of the third defendant.

1. This is an application by the plaintiff, (though the Notice of Motion incorrectly blames the defendant for it), seeking an extension of the time within which to commence proceedings against the third defendant. No extension of time is sought in relation to the first or second defendants.

2. The facts which the plaintiff will seek to prove at trial are that, in late 1997, he responded to an advertisement in the Canberra Chronicle for "Vista Laser Eye Clinics". This is alleged to be the business name of the first defendants. As its business name suggests, it offers vision correction by means of laser eye surgery.

3. On or about 10 November 1997, the plaintiff, then and now a Canberra resident, attended the Vista Laser Eye Clinic in Canberra in the Australian Capital Territory (the Territory). The plaintiff was given information concerning laser eye treatment and, as alleged in greater detail in paragraphs 15 and 17 of the Statement of Claim, had it represented to him that the proposed laser eye treatment would successfully correct his imperfect sight without adverse effects.

4. The plaintiff returned to the Canberra Clinic on 13 November 1997 and consulted the second defendant, an optometrist employed by the first defendants. One or two days later he had a consultation with the third defendant, (a surgeon employed by the first defendants), allegedly at the Canberra Clinic, in which the second defendant was jointly involved. The plaintiff alleges that they each confirmed the representations referred to in paragraphs 15 and 17 of the Statement of Claim. There were no warnings as to potential adverse side effects by or on behalf of any of the defendants.

5. The plaintiff, ultimately on 10 January 1998, attended the third defendant's rooms in Sydney, New South Wales for the administration of the laser eye surgery. It was administered. No warning as to potential adverse events was delivered on that occasion prior to surgery.

6. It is the plaintiff's claim that, far from being as successful as he had been led to believe that it would be, the result was significantly and seriously worse than before.

7. It is unnecessary to detail the claimed disabilities. Suffice to say that, if proved and liability found, they would warrant a very substantial claim for damages for personal injury.

8. Between 10 January 1998 and 8 March 2001 the plaintiff engaged in follow-up consultations with a view to seeking remedial treatment, including "enhancement" operations. One such operation was performed by the third defendant in Sydney in June 1998. A second such operation was scheduled but cancelled. There was no significant improvement in the condition of the plaintiff's eyes or sight.

9. Between August 1998 and November 1999, there were further consultations between the plaintiff and the second and third defendants.

10. After that, it seems, the plaintiff made numerous attempts to gain information from the first defendant, until around early March 2001. He believed, and this is not challenged in this proceeding, that the second and third defendants were considering his case and contemplating means to assist him with the disabilities that had appeared following the surgery on 10 January 1998.

11. In any event, however it came about, the plaintiff, on 8 March 2001, sought a second opinion. He consulted an independent optometrist who advised that, in his opinion, the damage to the plaintiff's eyes was permanent and that he should consult a solicitor.

12. In consequence of that advice, on 2 April 2001, the plaintiff consulted Mr Michael Goodwin of Alliance Legal, Solicitors.

13. Mr Goodwin conducted inquiries and obtained reports, including a medico-legal assessment of the plaintiff's disabilities, and then sought counsel's opinion.

14. The plaintiff consulted Mr Goodwin again on 2 May 2002 following the conclusion of this investigation. The substantive proceedings in this matter were commenced on 6 May 2002.

15. It is relevant to note that in April 2001, the second defendant advised the plaintiff, in writing, that it was the third defendant's recommendation to "wait at least one year" before attempting further treatments.

16. The medico-legal report obtained by the plaintiff's solicitors does not appear to have been received, having been three and a half months in preparation, until 9 April 2002.

17. The plaintiff, in his Statement of Claim, alleges causes of action in contract, breach of the Trade Practices Act 1974 (Cth), the Fair Trading Act 1992 (ACT) and the Fair Trading Act 1987 (NSW) and negligence. It is not alleged that the operative procedures performed by the third defendant were negligently carried out. It is, rather, a case of misrepresentation as to the outcome and of failure to warn of possible adverse results.

18. Some of the evidence the plaintiff will seek to rely upon suggests he was, and hence should have been warned that he was, in a high risk group in relation to laser eye surgery.

19. On the plaintiff's case, it is apparent that, whether dating from breach or from the onset of damage, the causes of action pleaded allegedly accrued to the plaintiff on 10 January 1998. The representations, though first made in November 1997, were repeated and continued without correction up until the surgery was undergone. The omission to warn likewise continued up until that event.

20. There are a number of limitation periods which are relevant.

21. Under the Trade Practices Act 1974 (Cth) (TP Act), s 82, the time for bringing an action in respect of an alleged contravention of s 52 claiming damages must be brought within three years "after the date on which the cause of action accrued" (s 82(2) TP Act). That limitation period is incapable of extension. However, it was, on 26 July 2001, changed to six years - see Trade Practices (Amendment) Act (No. 1) 2001.

22. The Limitation Act 1985 (ACT) (ACT Limitation Act) applies a general limitation period of six years "running from the date when the cause of action first accrues to the plaintiff" (s 11(1)). There is no special limitation period otherwise provided for causes of action in tort, contract, or breach of the Fair Trading Act 1992 (ACT) (ACT Fair Trading Act).

23. The general limitation period of six years has not been exceeded.

24. However, the ACT Limitation Act does provide a special limitation period in a case to which s 56 applies. That section provides:

"If the substantive law of another place being a State, another Territory or New Zealand, is to govern a claim before a court of the Territory, a limitation law of that place is to be regarded as part of that substantive law and applied accordingly by the court."

25. The question as to which "substantive law" will govern a claim may attract a different answer depending on the nature of the cause of action relied upon.

26. Since the High Court decision in John Pfeiffer Pty Ltd v Rogerson [2000] HCA 36; (2000) 203 CLR 503, it has been made clear that the law of the place where the relevant tort was committed will govern both liability and the assessment of damages, at least in the sense that the rules of private international law, being part of the law of the Territory, do so.

27. Usually, as in Breavington v Godleman [1988] HCA 40; (1988) 169 CLR 41 and John Pfeiffer v Rogerson (supra), the commission of the negligent act and the suffering of damage are virtually contemporaneous, and the place where the tort has been committed is not in doubt.

28. It is at least arguable that, in this case, the negligent advice given and the failure to warn occurred in the Territory in respect of all defendants. It is also arguable, particularly in respect of the case against the third defendant, that failure to warn also occurred in New South Wales.

29. In John Pfeiffer v Rogerson (supra) the joint judgment of Gleeson CJ, Gaudron, McHugh, Gumnow and Hayne JJ noted, delphically, that (at 538 [81]):

"... it is necessary to recognise that the place of the tort may be ambiguous or diverse."

30. The fact that the tort was not complete until the relevant laser eye operation occurred is not decisive in fixing the location of the tort.

31. In Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458 there was a failure by the appellant to warn the respondent, a purchaser and then consumer of the drug Distaval (Thalidomide), that it could be harmful to a foetus. And so it was in respect of the plaintiff. The drug was manufactured in the United Kingdom but sold and consumed in New South Wales where the damage was suffered. Where did the cause of action arise? It was only if it arose in New South Wales that service of New South Wales process could have been validly effected. The Privy Council (Lord Pearson delivering the advice of the Council on behalf of Lords Reid, Morris of Borth-y-Gest, Upjohn and Donovan) answered "New South Wales". That was, however, not on the basis that New South Wales was where the consumption of the drug took place, but because (467-8):

"In a negligence case the happening of damage to the plaintiff is a necessary ingredient in the cause of action, and it is the last event completing the cause of action. But the place where it happens may be quite fortuitous and should not by itself be the sole determinant of jurisdiction ..."

(469):

"In the present case on the assumptions made for the purpose of testing jurisdiction there was negligence by the English company in New South Wales causing injury to the plaintiff in New South Wales. So far as appears, the goods were not defective or incorrectly manufactured. The negligence was in failure to give a warning that the goods would be dangerous if taken by an expectant mother in the first three months of pregnancy. That warning might have been given by putting a warning notice on each package as it was made up in England. It could also have been given by communication to persons in New South Wales - the medical practitioners, the wholesale and retail chemists, patients and purchasers. The plaintiff is entitled to complain of the lack of such communication in New South Wales as negligence by the defendant in New South Wales causing injury to the plaintiff there. That is the act (which must include omission) on the part of the English company which has given the plaintiff a cause of complaint in law. The cause of action arose within the jurisdiction."

32. Their Lordships further pointed out that if, for example, the plaintiff had consumed the medication whilst on holidays in a foreign country, it would be bizarre to suggest that because the damage was sustained there, the cause of action arose there (468).

33. That decision was followed in Jacobs v Australian Abrasives Pty Ltd [1971] Tas SR 92. In that case a grinding wheel manufactured in New South Wales shattered after use in Tasmania, causing injury. The negligence was failing to take reasonable care in manufacturing the article, or failing to give adequate instructions or warnings as to its use. Burbury CJ considered that (at 97):

" ... the tort of negligence is committed when and where the breach of duty is complete, and that is in Tasmania."

34. In Buttigeig v Universal Terminal & Stevedoring Corporation [1972] VR 626, Crockett J considered the case of a worker injured whilst working on a ship in the Port of Melbourne, when he fell through an allegedly defective sheet of masonite. The negligence alleged was that of a foreign stevedoring company in incorrectly and unsafely stowing the cargo in New York. The stevedoring company objected that no tort had been committed in Victoria. The only ground available to support service on the stevedoring company in New York was that the tort had been committed in Victoria.

35. Crockett J observed that the real act of negligence alleged was the defective storing of the cargo. It was "unreal" to characterise the negligence as failure to warn of the insufficiency of the masonite covering sheet to bear a man's weight. The act of negligence thus occurred in New York not Victoria.

36. In Macgregor v Application des Gaz [1976] Qd R 175, Matthews J concluded that where a gas lantern manufactured in France caused damage to a Queensland purchaser, the nexus with Queensland was "unreal and artificial". The real place where the cause of action arose was France where the defective article was manufactured. Again, failure to warn was a relevant particular of negligence, but not regarded as the real act of negligence insofar as it continued in Queensland.

37. In the latter two cases the act of negligence was a discrete and completed event, albeit that there was a continuing failure to warn. All that remained, after the masonite sheet was put in place or the gas lantern was manufactured, was for damage to be sustained. True, the damage was avoidable by some remedial step being taken before it was sustained, but the substantive act of negligence had already occurred in the foreign law jurisdiction.

38. The distinction between Jacobs and the latter two cases is, to my mind, obscured within the confines of that delphic rubric I referred to in [29] above.

39. Sydbank v Soenderjulland A/S Bannerton Holdings (1996) 68 FCR 539 involved a claim for damages under the TP Act. The respondent, in Australia, conversed with the appellant in Sweden. The appellant represented that it would deal with the respondent's Eurobonds in a certain way. Without informing the respondent, the appellant decided, it was alleged, not to accept the respondent's instructions and so dealt with them differently. The respondent claimed to have suffered damage in Australia as a result of this decision.

40. The alleged misleading conduct was not the original acceptance of instructions, but rather the undisclosed formation of an intention not to deal with the proceeds of the sale of Eurobonds as instructed. The representation so constituted was held by Beaumont, Drummond and Sundberg JJ to have "occurred in Australia".

41. That conclusion relied upon the principle that a representation is made where it is received. The alleged misleading representations were the essential feature of the pleaded cause of action.

42. In the present case, the alleged representations and failure to warn, both express and implied, were imparted to the plaintiff both in the Territory and in New South Wales.

43. The omission of each of the defendants (the first defendants vicariously) to warn the plaintiff of the potential risks of laser eye surgery occurred both in the Territory and New South Wales. Each of the representations and omissions is the essence of the pleaded causes of action. The place where the damage occurred is entirely fortuitous. Thus, in my opinion, the place of the tort and of the causes of action other than contract is the Australian Capital Territory.

44. It follows that no extension of time is required on the assumed facts.

45. Nevertheless, as the third defendant, it appears, may deny that any act or omission was committed by him in the Territory, it is possible that the causes of action pleaded against him could have arisen in New South Wales. Thus, it is necessary to consider whether an extension of time, if required, should be approved.

THE PROPER LAW OF THE CONTRACT

46. Choice of law in contract is less controversial. It may be agreed between the contracting parties. Otherwise it is the law of the place with which the contract has the closest connection - see Mendelson - Zeller Co Inc v T & C Providores Pty Ltd [1981] 1 NSWLR 366.

47. In the present matter, the agreement with the first defendant was made in the Territory. Payment was to be made here. The terms of the agreement were concluded here. Insofar as that included the representations as to the safety, efficacy and lack of deleterious consequences, those terms or representations made to induce the agreement were made in the Territory. The only connection with New South Wales was the carrying out of the promised treatment by an employee of the first defendants in New South Wales. The closest and most real connection of the contract is with the Territory not New South Wales. Thus the law of the Territory is the law governing the contract and its performance not that of New South Wales. Indeed, it was not contended that any extension of time was required to prosecute the contract claim against the first defendants.

THE ROLE OF NEW SOUTH WALES LAW

48. The only role the law of New South Wales will play is if it rests with the Fair Trading Act 1987 (NSW) (NSW Fair Trading Act) or the tort law of that State to found liability in the third defendant.

49. To that extent, s 56 of the ACT Limitation Act is engaged to provide the limitation period for such cause or causes of action.

50. Nevertheless, even if the effect of the ACT Limitation Act is, by reference to New South Wales law, to bar the action against the third defendant, he is and remains potentially liable to be called upon to contribute to any verdict entered against the other defendants.

51. Before the enactment of s 56 and 57 of the ACT Limitation Act, limitation laws of another jurisdiction imposing only a procedural bar to the proceeding as opposed to extinguishing the cause of action, would be regarded as but part of the procedural law of that jurisdiction and thus not applicable to causes of action arising there but litigated in this court - see Pederson v Young [1964] HCA 28; (1964) 110 CLR 162, 166-7; McKain v R W Miller & Co (SA) Pty Ltd [1991] HCA 56; (1991) 174 CLR 1, 42-4; Gardner v Wallace [1995] HCA 61; (1995) 184 CLR 95.

52. As I noted in Mason v Murray's Charter Coaches and Travel Services Pty Ltd [1998] FCA 1430 (2 November 1998); [1998] FCA 1430; 88 FCR 308; 159 ALR 45, the effect of s 56 is to apply the limitation laws of New South Wales to such a claim, not by force of New South Wales law, but by force of Territory law. Drummond and Sackville JJ expressed a similar view in that case.

53. Whilst it may not be strictly accurate to refer to New South Wales law as "governing" the claims in this Court, the intent is clear. By force of s 56 (ACT Limitation Act), this Court is directed to apply, as if it were a limitation law under the ACT Limitation Act, the relevant limitation law of New South Wales.

54. In the present case that is a reference to s 18A of the Limitation Act 1969 (NSW) (the NSW Limitation Act):

"18A Personal injury

(1) This section applies to a cause of action, founded on negligence, nuisance or breach of duty, for damages for personal injury, but does not apply to:

(a)  a cause of action arising under the Compensation to Relatives Act 1897, or

(b)  a cause of action that accrued before 1 September 1990, or

(c)  a cause of action to which Division 6 applies.

Note. Division 6 provides for the limitation period for non-motor accident actions for death or personal injury resulting from an incident that occurs on or after the commencement of that Division.

(2) An action on a cause of action to which this section applies is not maintainable if brought after the expiration of a limitation period of 3 years running from the date on which the cause of action first accrues to the plaintiff or to a person through whom the plaintiff claims."

55. Section 57 of the ACT Limitation Act authorises an extension of that time bar insofar as, and in the same manner as, it would be done under the law of New South Wales.

56. That is a reference to the operation of s 60C(2) of the NSW Limitation Act. This court may, therefore:

"... if it decides that it is just and reasonable to do so, order that the limitation period for the cause of action be extended for such period, not exceeding 5 years, as it determines."

57. The limitation period dates from 10 January 1998. The period set by s 18A expired on 10 January 2001. Proceedings were commenced on 6 May 2002. The causes of action in relation to the third defendant are prima facie barred insofar as they arose in New South Wales but are capable of extension under s 60C(2) (supra).

SHOULD THE TIME BAR BE EXTENDED?

58. There is no doubt that, by reference to s 60C(2) (supra) as required by s 57 of the ACT Limitation Act, this court has a discretion to extend the time bar.

59. The manner in which that discretion is to be exercised is materially no different from that required pursuant to s 36 of the ACT Limitation Act, as has been authoritatively determined by the New South Wales Court of Appeal (see Salido v Nominal Defendant (1993) 32 NSWLR 524 (CA); Mason v Murray's Charter Coaches and Travel Services) (supra). The relevant factors, for present purposes, are set out in s 60E(1)(a)-(h) of the NSW Limitation Act.

60. It is convenient to consider those factors:

(a) The length of and reasons for delay

These factors have been already referred to. It is the whole period from the accrual of the relevant cause of action which is relevant - not merely the excess beyond the expiry date.

It was, in my view, reasonable for the plaintiff to have submitted to attempts by the defendants to ameliorate his plight. The enquiries and investigations made to ensure that he had a good case before commencing proceedings were also reasonable. Indeed, to do otherwise would have been irresponsible. The total delay of about four years and three months from the accrual of the cause of action is not extreme, particularly having regard to the continued contact between the plaintiff and the defendants for most of that time.

(b) Prejudice arising to the defendant by reason of delay

No particular prejudice is claimed. Indeed, the defendants have had the opportunity to monitor the plaintiff's condition closely for nearly three years. It must be borne in mind that the third defendant is prejudiced by the loss of a defence which could answer the separate claims against him, albeit only insofar as a New South Wales cause of action is concerned, he not being in a contractual relationship with the plaintiff.

Conversely, of course, there is a real chance that he would be liable for the acts of negligence committed in this Territory, and for breach of the ACT Fair Trading Act. In any event, it is open to the other defendants, if found liable, to seek contribution in respect of any damages they might have to pay whether in tort, contract or under the ACT Fair Trading Act.

(c)&(d)The time at which the injury itself, and the nature and extent of the injury,

became known to the plaintiff.

The failure of the laser eye operation did not take long to manifest itself, but the plaintiff did not know until about March 2001 that further improvement could not be expected.

(e) The time at which the plaintiff became aware of the connection between the injury and an act or omission of the defendant.

The plaintiff may well have suspected such a connection when he sought legal advice on 2 April 2001. However, he did not know that he had an arguable case until the expert medico-legal report confirmed that, in that expert's opinion, he should have been warned of certain risks posed by the laser eye surgery he had undergone.

(f) Conduct of the defendant inducing delay

The continued treatment, including advice in April 2001 to "wait a year", could reasonably have been taken to divert the plaintiff's attention from seeking other advice which might earlier have led to proceedings being commenced. It did not, however, have that effect. The plaintiff had by then sought advice. Nevertheless, the continuing treatments and consultations up to March 2001 would have had the effect of delaying the taking of legal and other advice.

(g) Steps taken by the plaintiff to obtain relevant advice

These have been outlined. They were reasonable steps.

(h) The extent of the plaintiff's injury or loss

As detailed the injuries and losses are substantial.

GENERALLY

61. It is, of course, for the plaintiff to persuade the Court that the extension of time sought should be granted. The circumstances of this case persuade me strongly that the extension of time sought should be granted, and the time period extended accordingly in respect of the third defendant, insofar as that may be necessary to pursue a cause of action arising in, and hence governed by, the law of New South Wales.

62. I will hear the parties as to costs.

I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Chief Justice Higgins.

Associate:

Date: 1 August 2003

Counsel for the plaintiff: Mr White

Solicitor for the plaintiff: Alliance Legal

Counsel for the third defendant: Ms Card

Solicitor for the third defendant: Mallesons Stephen Jaques

Date of hearing: 2 May 2003

Date of judgment: 1 August 2003