Ginos & Associates v NBD Bank NA & Anor A17/1998 [1999] HCATrans 184 (18 June 1999)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No A17 of 1998

B e t w e e n -

GINOS & ASSOCIATES PTY LTD

Applicant

and

NBD BANK NA (FORMERLY KNOWN AS NATIONAL BANK OF DETROIT)

First Respondent

SOUTH ITALY TILING (SA) PTY LTD trading as BRIANNI CONSTRUCTION

Second Respondent

Application for special leave to appeal

GLEESON CJ

CALLINAN J

TRANSCRIPT OF PROCEEDINGS

FROM ADELAIDE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 18 JUNE 1999, AT 12.31 PM

Copyright in the High Court of Australia

MR D.A. TRIM, QC: May it please the Court, I appear with my learned friend, MR J.E. LUNN, for the applicant. (instructed by Rowell Forrest & Co)

MR R.J. WHITINGTON, QC: If the Court pleases, I appear with my learned friend, MR M.N. RICE, for the first respondent. (instructed by Fisher Jeffries)

MR J.A. DAENKE: If the Court pleases, I appear for the second respondent. (instructed by Daenke O'Donovan)

GLEESON CJ: Mr Trim, I want you to clear up a matter that may be the subject of some misunderstanding on my part. Am I right in thinking that the issues that you say are the special leave issues in this case relate to the operation of some provisions of the Development Act of South Australia and the Builders Licensing Act of South Australia?

MR TRIM: Yes, your Honour.

GLEESON CJ: Am I also right in thinking that the Full Court of the Supreme Court of South Australia took the view that those issues did not arise for that court's determination because of the view the court took of the case on the facts?

MR TRIM: No, in that respect we would say that the court - Justice Cox at page 99 of the application book assumed for the purpose of his judgment that section 72 applied and went on to determine the section 72 issue, if I may use that shorthand expression, on the basis that he had applied the findings of fact that were made in respect of the determination of tortious liability so as to exclude - - -

GLEESON CJ: But was the assumption that Justice Cox made an assumption made an assumption in your favour?

MR TRIM: Yes.

GLEESON CJ: So the Full Court in South Australia was prepared to assume in your favour the issues you want to agitate on this appeal?

MR TRIM: It was but, having made that assumption as to the principal leave point that we say arises, his Honour, in our respectful submission, applied the wrong test in determining the issue of proportionate liability that arises under section 72 of the Development Act. This is the first case of which we are aware in which the Supreme Court of South Australia has had to address the concept of proportionate liability. The error in his Honour's reasons that we point to appears at page 99 commencing at line 28. It is the paragraph commencing "The result must be the same". That is the paragraph in which, as I have said a moment ago, his Honour plainly assumed for the purpose of the argument that section 72 applied.

GLEESON CJ: But one of the arguments that is advanced against you by the respondent is that, because of the approach that was taken to the facts in the courts below, this case does not really raise the issues about the legislation that you want to get into.

MR TRIM: I am very conscious of that argument, namely, that it was not a suitable vehicle, but we say that the points that we seek to agitate do not give rise to any challenge to the factual findings made in the courts below and indeed they are accepted, as they must be, but that the error that has occurred is that, given those findings, his Honour Justice Cox applied the wrong test in determining whether the judgment to be entered against the applicant should be reduced on account of the statutory liability, the statutory contractual liability, of the second respondent.

GLEESON CJ: Where do we see him applying that wrong test; what page?

MR TRIM: In the paragraph on page 99 that I just identified, starting at line 28. In the preceding paragraph, if I may go back a step, his Honour has dealt with the apportionment of liability pursuant to the contribution provisions of the Wrongs Act and found that notwithstanding, there had been a finding of statutory liability. There of course, given the Full Court's dismissal of the finding of negligence at first instance against the second respondent, there was no order to be made. The trial judge had in the exercise of his discretion ordered that the second respondent fully indemnify the applicant pursuant to the discretion found in 26 of the Wrongs Act.

But when we come to the paragraph that I have identified commencing at line 28, it is plain his Honour has made the assumption I have referred to and, as your Honour pointed out, plainly in my client's favour. His Honour halfway down that paragraph goes on to say:

On that footing it was proper for the learned Judge to hold, as he did, for the reasons applicable to his Wrongs Act ruling, that any judgment given under s72 should be against Ginos alone.

That is the applicant.

It would not be just and equitable to regard Tiling as having contributed significantly to NBD's damage or loss.

We say the error that his Honour fell into at that point is that he has applied the test for comparative liability between tortfeasors to the test that should be applied to the determination of proportionate liability under the Development Act. There being a finding of causal fault by virtue of the statutory liability that arose, being a breach of the Builders Licensing Act provisions, there being that finding, the result should have been a reduction in the judgment sum against the applicant. That is the nub of the most important ground that is advanced as justifying special leave.

We say that notwithstanding that the respondents' position is that this is not a suitable vehicle, to enable the issue to be agitated and the Court to determine the proper basis upon which proportionate liability should be determined and whether there should be a reduction in the liability of the applicant in the sense that the judgment sum entered against it must be for a lesser amount having regard to the finding of causal liability against the second respondent, the only findings that are required to make this an appropriate vehicle for an appeal are those that are dealt with on page 99 of Justice Cox's judgment, namely, a finding in liability in tort against the applicant, the finding of the breach of contractual warranty against the second defendant, together with the finding that, although the breach of statutory warranty was causally insignificant when compared with the negligence of the applicant, there was no finding that no loss was caused by that breach of warranty.

It is in respect of that latter limb that we say that "insignificant" may mean small, but plainly there was some causal loss attributable to the breach of statutory warranty that should have led, by virtue of the application of section 72, to a reduction in the judgment to be entered against the applicant. What we say in respect of the first respondent's submissions in particular is that they have confused the test to be taken into account in determining proportionate liability, the test or criteria to be taken into account in the determination of the respective degrees of responsibility that would lead to an appropriate reduction in the judgment sum against the applicant pursuant to the application of section 72.

That is the nub of what is identified as the third issue in paragraph 1.3 of the applicant's amended summary of argument. I should have said perhaps at the inception that we do seek leave to rely upon the amended documents that have been delivered and served. The second issue identified in paragraph 1.3(b) of the argument is whether the provisions of the Act apply. It is characterised by the respondents as an argument for retrospectivity. The point that the applicant would seek to agitate on appeal is that it should not be viewed as a retrospectivity issue at all but rather a matter of the interpretation of the section, the issues being whether or not the terms of section 72 prevent a court from entering a judgment after the enactment of the provision so that no issue of retrospectivity applies. It would simply be a matter of statutory interpretation.

The other issue in the alternative that the applicant would seek to agitate on appeal in respect of that ground is that, as this is remedial legislation and designed, as the applicants submit, to remedy the injustice of a party in the applicant's position wearing the total amount of responsibility, the presumption against retrospectivity should not be seen to apply. The third issue identified in the outline of argument is that, although his Honour Justice Cox has assumed it for the purpose of his judgment in the paragraph I have identified, the issue of whether there is indeed joint and several liability for the purposes of section 72 should be determined upon appeal.

It is the applicant's contention that, as the loss arose as a consequence of that carried out in concert by the applicant and the second respondent, the action in concert being of course the construction of the house, whether the wrongs are legally categorised in different compartments is not to the point. The issue that the applicant would seek to agitate on appeal is whether joint and several liability arises when the liability against the applicant has been found to rest in tort. The liability against the second respondent is found to arise pursuant to a breach of the statutory warranty, and that is the third issue that we say arises for determination on appeal if leave was granted.

They are the issues that we say give rise to the special leave application and justify the grant of special leave. We have in the outline of argument identified the remedial nature of the legislation. I do not seek to take the Court to that in detail, but there is a significant difference between the Wrongs Act that I have already identified and the approach we say that should be taken to the determination of proportionate liability. The remedial nature of the legislation which makes the issue one of importance is that the injustice to be remedied is where a plaintiff's loss will be visited upon one defendant in whole when the other defendant is unable to bear its share, hence the concept of proportionate liability evolving in the first instance. They are the matters that are sought to be put in support of the application.

GLEESON CJ: Yes, thank you, Mr Trim. We do not need to hear you, Mr Whitington or Mr Daenke.

Having regard to the findings of fact that were made in the courts below and to the basis on which the appellate court dealt with the case, the case does not, in our view, constitute an appropriate vehicle for considering the issues of statutory construction which form the basis of this application and the application is dismissed.

MR WHITINGTON: Is it appropriate for the first respondent to apply for costs?

GLEESON CJ: Can you resist an order for costs, Mr Trim?

MR TRIM: No, your Honour.

GLEESON CJ: The applicant must pay the respondents' costs of the application.

We will adjourn to reconstitute.

AT 12.45 PM THE MATTER WAS CONCLUDED